To our Shareholders:
Discipline, resourcefulness, experience, strong risk management capabilities, keen market insight and an unrelenting focus on results: These core strengths enable ADM to find opportunity in volatility year after year. And our 2011 fiscal year offered no shortage of volatile, complex conditions.
Sharply fluctuating commodity prices, erratic and sometimes destructive weather, sociopolitical upheaval, restrictive trade policies and persistent economic uncertainty made an always unpredictable operating environment even more challenging. The ADM team nonetheless produced strong results: net earnings of $2 billion―up 5 percent over 2010―and record segment operating profit of $4 billion—a 24 percent increase over our 2010 total. We also extended our record of dividend payments to 319 consecutive quarters, or nearly 80 years. And, we continued to make improvements in safety, reducing our total recordable incident rate by 17 percent and our lost workday injury rate by 7 percent.
A year like 2011 highlights the benefit of our global sourcing, transportation and processing network. When civil unrest in the Middle East, drought and trade embargoes in the Black Sea, the earthquake and tsunami in Japan, and flooding in the U.S. caused disruptions—in supply, demand and the trade flows that connect them—our team sourced alternative supply, managed risk and continued delivering crops and products to serve vital needs for food and energy. Though our success at managing through complexity in 2011 was notable, it was not unprecedented. In each of the past four years, ADM’s business model has enabled us to deliver strong results amid very different— though often equally challenging—circumstances. Individual business units’ contributions to earnings have varied widely as a percentage of the company’s total, demonstrating our ability to adapt to ever-changing market conditions.
To create a platform for greater success, we are advancing a strategy for profitable global growth. By building out our integrated sourcing, storage and transportation model in regions where crop supplies are increasing, and by expanding our processing and distribution capabilities in regions where demand is increasing, we gain greater ability to serve the needs of a growing world.