Print This PageDelivering Value to Our Shareowners
Referring back to our business philosophy, if our innovation generates more yield that meets the demands placed on farmers, we will grow. For the past several years our approach has been to take our growing earnings and turn those earnings into cash. We are fortunate to be operating from a very strong cash position with low net debt, which allows us to continue to execute our multi-pronged strategy of:
- Investing in strategic acquisitions and collaborations,
- Supporting commercial growth through capital spending, and
- Bolstering direct returns to shareowners through increased dividends and share buybacks.
When we look at our approach to dividends, for example, we are driven by the philosophy that we should give strong consideration to increasing dividends when our earnings grow, which is why in 2008 we increased our quarterly dividend payout by 37 percent. We also are close to completing our first $800 million share buyback authorization. Once we complete this program, a new $800 million, three-year buyback plan will automatically go into place. Like everything else we do, dividends and share buybacks represent our commitment to return value to our shareowners. As we expect to generate about $3 billion in operating cash for fiscal 2009, we are comfortable that we can maintain these commitments, and the rest of our multi-pronged strategy, going forward.
As we move ahead in 2009 and beyond, our management and our employees will remain constantly focused on the farmers’ success. Because when farmers succeed, we succeed. It’s as simple as that. And we can share our success with our shareowners to reward them for putting their faith and confidence in us.
Uses of Cash
In 2008, Monsanto continued to convert our
earnings into operating cash. Free cash flow
in fiscal year 2008 supported the investment
of $1 billion in acquisitions and technology
investments, a reinvestment of an additional
$918 million in capital expenditures, the
return of $419 million of cash to shareowners
through dividends, and $361 million in
share repurchases.
