Resourceful by Nature:
ADM Executive Showcases Global Resources, Global Interests
Margaret Loebl just bought twenty railroad cars for use in Brazil. She's
monitoring infrastructure development in that country at the same time
that she's thinking about the hedge price of corn and soybeans in the
US and international markets.
business today is global, complex, and fraught with risk was made clear
during a presentation by Archer
Daniels Midland's Margaret Loebl, vice president of finance at the
Decatur-based multinational company. An agricultural processor with business
interests spanning the globe, ADM's value chain starts with grain acquisition
direct from farmers and progresses through oil and meal production to
blending and packaging.
The company, with $37 billion in annual sales last year, is working up
the value chain, she said in her January presentation to graduate students
in the MS in Finance program, noting
ADM's recent alliances with chocolate companies in Europe. ADM is the
world's largest processor of cocoa and has expanded to blending and producing
chocolate and packaging it based on the specifications of various chocolate
Overall the company's strategic focus is to maintain their market share
in key markets, to continue to be low-cost producers, to capitalize on
geographic opportunities, and to expand their value-added businesses.
Their challenges include trace-ability and food safety, world and regional
food preferences, and rebalancing global supply and demand.
From Farmer to Consumer
In its recently unveiled commercials, ADM showcases its new tagline "Resourceful
by nature." Loebl is proud of how the company demonstrates its resourcefulness
as it coordinates with farmers. "We have to be nimble with farmers
to succeed," she said. The company is always searching for efficiencies
in its operations around the globe and maximizing its expenditures in
research and technology utilization.
The company's resourcefulness also extends to evaluating new markets.
Their focus is on China, where the protein needs are expected to grow
enormously as the population consumes a more Western middle-class level
of protein. Loebl noted that ADM took into account the possibility of
future import restrictions making it harder to import processed products
into China. That was a key factor in their strategic decision to process
beans in several plants in China rather than shipping more processed products
to the world's most populous country.
Looking for a Challenge, Looking for Risk
Loebl has been with ADM for several years, coming to the company from
footwear giant NIKE and after more than a decade of experience at General
Motors. For Loebl, one of the appeals of the job at ADM was the constantly
changing environment that she calls dynamic and interesting. Each ADM
sector has risks -- such as the weather and the overseas markets -- and
that is one of the major challenges Loebl faces each day. "We have
to evolve to the footprint we have," she noted. And that is the overall
challenge that keeps her engaged and makes and keeps her job interesting.
Loebl says today's challenges are the company's ratings as determined
by rating agencies, capital planning, dividend/share repurchase, and overall
risk management. ADM's approach to ratings is to determine the rating
level that is acceptable to the company and factoring that into their
corporate decision-making. Although recently downgraded by several firms,
she is satisfied with their current ratings, noting that ADM can still
borrow funds at acceptable levels and rates. But she doesn't want their
ratings to go any lower.
Developing a long-term financial model based on current and future risks
-- more along the lines of textbook examples -- is a new project for Loebl
and her staff. Key to making progress is to understand their business
from bean to final product, targeting their free cash flow, and pushing
down into ADM to make changes to meet their targets.
About the Speaker and ADM
Group Vice President-Finance at ADM, Margaret Loebl has a BS from Wellesley
College in German and Economics and an MBA from the University of Chicago.
She speaks four languages and has lived in a like number of foreign countries.
She joined ADM in 2002 and previously served as vice president-corporate
finance of NIKE, Inc. Prior to joining NIKE, Loebl spent more than 13
years with General Motors Corporation in various finance and control positions
around the world. She serves on the Wellesley College National Business
Archer Daniels Midland Company is one of the largest agricultural processors
in the world. The company takes crops and processes them to make food
ingredients, animal feed ingredients, renewable fuels and naturally derived
alternatives to industrial chemicals. Founded in 1902 and incorporated
in 1923, ADM is headquartered in Decatur, Illinois, and operates processing
and manufacturing facilities across the United States and worldwide. ADM
has extensive global distribution facilities and capabilities.