An investor has publicly urged Archer-Daniels-Midland (ADM) Chief Executive Juan Luciano to resign due to ongoing transparency issues regarding an investigation into the company's accounting practices. Hartwig Fuchs shared his concerns in a LinkedIn post on Monday, labeling ADM's stock as the 'worst' performer in his portfolio this year, reflecting a significant year-to-date decline of 30%.
Fuchs emphasized that the company appears to be making no efforts to address or reverse this downward spiral in share price. Fuchs, who previously served as the board chairman of German commodity trading firm Alfred C. Toepfer International prior to its acquisition by Archer-Daniels-Midland in 2014, expressed frustration at ADM’s lack of communication.
He pointed out that for nearly a year, there has been a notable expansion in law enforcement scrutiny concerning ADM's internal pricing mechanisms for inter-company transactions. "We are left in the dark, as ADM has failed to provide any valuable updates or statements," Fuchs remarked. Archer-Daniels-Midland has yet to issue a comment in response to queries from MT Newswires. Earlier in January, the company placed its then-Chief Financial Officer, Vikram Luthar, on administrative leave as part of an investigation tied to the nutrition segment's accounting procedures, which involve complex inter-segment transactions.
Subsequently, the company appointed Monish Patolawala, the former CFO of 3M (MMM), as the new finance chief, effective August 1, following Luthar's resignation on September 30. Fuchs criticized the current management, stating, "If a highly paid CEO of such an important company cannot manage to provide clarity within a few months—specifically to clarify the scandal, communicate transparently about the issues at hand, restore investor confidence, and safeguard the company’s long-term integrity—there must be consequences, including a potential resignation." In November, Archer-Daniels-Midland disclosed the discovery of additional errors concerning inter-segment sales, which necessitated a restatement of financials for certain periods following interactions with the Securities and Exchange Commission.
Later that month, the company announced it achieved adjusted earnings of $1.09 per share in the third quarter, a decline from $1.63 the previous year, with revenue dropping to $19.94 billion from $21.7 billion. Current Stock Price: $50.52, Change: +0.45, Percent Change: +0.90..