Article

by Carey Gillam

• Sees 3.8 bu/acre yield advantage for soybean seed
• Reaffirms 2011 EPS guidance of $2.67 to $2.77

KANSAS CITY, Nov 8 (Reuters) - Monsanto Co. MON.N said on Monday its newly harvested U.S. corn and soybean products were showing good yield performance, and the company reaffirmed guidance on earnings per share, cash flow, and growth.

“Our harvest data provides confidence supporting our U.S. product strategy in 2011,” said Hugh Grant, Monsanto chairman and chief executive officer in a statement.

Monsanto said it saw “performance advantage” from its Genuity Roundup Ready 2 Yield soybeans, as well as its Genuity SmartStax corn seed. Investors and farmers have been scrutinizing both products closely.

Monsanto said its Genuity Roundup Ready 2 Yield soybeans delivered a yield advantage over competitor varieties of the first-generation Roundup Ready trait of greater than three bushels per acre. In particular, multi-year testing of Genuity Roundup Ready 2 Yield indicates the technology is delivering an average yield advantage of 3.8 bushels per acre, Monsanto said.

Monsanto said it expect Genuity Roundup Ready 2 Yield soybeans to ramp up to a range of mid-teens millions of acres in the U.S. for the 2011 season. Monsanto said it saw similar yield advantages for its new corn seed products.

The company’s Roundup Ready 2 Yield soybeans have been the subject of controversy after farmers reported poor performance last year.

Last month, the West Virginia Attorney General’s office filed a lawsuit against Monsanto seeking to prohibit it from doing business in the state. Earlier this year, the attorney general said it was investigating Monsanto for unfair or deceptive practices in marketing its new genetically altered soybean seeds.

Monsanto has discounted the allegations and said West Virginia officials have misunderstood their marketing.

Monsanto said the results helped it confirm 2011 earnings per share guidance of $2.72 to $2.82 on an ongoing basis and $2.67 to $2.77 on an as-reported basis.

The company continues to project free cash flow in the range of $800 million to $900 million, which reflects an expected investment of $600 million to $700 million in capital expenditures.

The company said it expects net cash provided by operating activities to be $1.7 billion to $1.9 billion, and net cash required by investing activities to be approximately $900 million to $1 billion for fiscal year 2011.

The company’s shares were down 23 cents at $62.04 in midday trading.

(Reporting by Carey Gillam; Editing by David Gregorio)