Monsanto, a US-based agrochemical firm, reported its earnings results for the second quarter that ended February 29, 2016. The company reported a 25% drop in its quarterly earnings as farmers try to reduce their expenditure.

The biotechnology company posted a net income of $1.06 billion for the second quarter of 2016, down from $1.42 billion in the same period in 2015. Income from operations for the quarter declined to $1.66 billion from $2.02 billion in the previous year period. Quarterly earnings per share fell to $2.41 from $2.92 in the year-ago period.

Earnings from ongoing business totaled $2.42 per share, down from $2.90 per share in the corresponding period in 2015. Gross profit for the period decreased to $2.6 billion from $3.04 billion in the previous year period.  Monsanto's net sales decelerated to $4.5 billion from $5.2 billion in the prior year quarter.

For the year 2016, the company updated earnings per share outlook in the range of $3.72 to $4.48. On an ongoing basis, Monsanto estimates earnings between $4.40 and $5.10 per share for 2016. The company reaffirmed its 2016 cash flow guidance between $1.4 billion and $1.6 billion.

According to abcNEWS, the company's earnings missed Wall Street analysts' view. Analysts polled by Zacks Investment Research expected Monsanto to register earnings of $2.45 a share on revenues of $4.78 billion. The shares of the firm were up 29 cents at $86.39 during the morning trading session on Wednesday but has declined 26% since the past 12 months.

Sonoran Weekly Review quoted Hugh Grant, CEO of Monsanto, who said that the company will concentrate more on research and development rather than be investing in merger and acquisition deals for growth. "We believe the industry will continue to rationalize, focusing investment on the highest return options," he said. The decision by the company comes after its failure to purchase Syngenta for $46 billion.

For the six-month period, net income available to Monsanto Company amounted to $810 million, down from $1.67 billion in the same period in 2015. Net income for the period declined to $803 million from $1.66 billion in the previous year period. Income from operations decreased to $1.4 billion from $2.4 billion in the six-month period that ended February 28, 2015.

Earnings per share dropped to $1.80 from $3.41 in the prior year period. On an ongoing basis, earnings fell to $2.25 per share from $3.36 per share in the year-ago period. Net income attributable to Monsanto Company from ongoing business was $1.02 billion for the period, down from $1.64 billion in the previous year period.

Gross profit for the six-month period declined to $3.5 billion from $4.45 billion in the prior year period. Net sales totaled $6.75 billion, compared to $8.07 billion in the previous year period. The company's earnings were hurt by poor demand from farmers, trying to lower their expenses. Monsanto is attempting to recover its financial position from the global crisis.