By Karl Plume and Seher Dareen
(Reuters) -Shares of Archer-Daniels-Midland plunged 24% on Monday, its biggest one-day drop since 1929, after CFO Vikram Luthar was placed on administrative leave as the company investigates accounting practices at its Nutrition segment.
The global grains merchant cut its 2023 profit forecast and said fourth-quarter results would be delayed due to the investigation related to certain inter-segment transactions, in response to a voluntary document request by the U.S. Securities and Exchange Commission (SEC).
The probe brings more uncertainty to ADM's high-margin Nutrition segment, which is under pressure due to weak demand for meat alternatives and other products as well as downtime at a large soy processing facility.
ADM's stock closed at $51.69 a share, the lowest since February 2021. Its 24% fall was the largest one-day percentage decline for the shares since Nov. 13, 1929, two weeks after the market crash of 1929, according to the Chicago-based Center for Research in Security Prices.
The SEC did not respond to a Reuters request for comment. ADM said it is cooperating with the SEC.
Luthar joined ADM nearly two decades ago, serving in various leadership roles before being appointed CFO in 2022.
The company posted a string of record earnings due to favorable crop processing margins and strong demand for food, animal feed and biofuel. The Nutrition segment, however, has not performed well in recent quarters.
The segment supplies ingredients including plant-based proteins, natural flavors and emulsifiers to food, beverage and nutritional supplements industries, among others.
Recent large investments in animal feed and pet nutrition have also not lived up to expectations, analysts said.
At
Read more on investing.com