Reports related to this article:
Project(s): View 2 related projects in PECWeb
Plant(s): View 2 related plants in PECWeb
Released July 18, 2012 | SUGAR LAND
en
Researched by Industrial Info Resources (Sugar Land, Texas)--Leading miner and fertilizer producer The Mosaic Company (NYSE:MOS) (Plymouth, Minnesota) reported mixed results for the company's fiscal 2012 fourth quarter and full year, as the quarter saw stronger potash prices but weakened phosphate prices. Lower sales volumes in the Potash segment and higher raw material costs in the Phosphate segment wore away at full-year earnings. Net earnings were reported to be $507.3 million for the quarter, a 78.14% decrease from the fourth quarter of fiscal year 2011, and $1.93 billion for the year, a 23.24% decrease from fiscal 2011.
Total net sales stood at $2.82 billion for the quarter, a 1.39% decrease from the same period last year, and $11.11 billion for the full year, an 11.77% increase from the 2011 fiscal year. In a press release, Jim Prokopanko, the president and chief executive officer of Mosaic, said that the Phosphates segment experienced "robust shipments worldwide," while farmers worldwide "applied high quantities of potash in the fiscal fourth quarter." He also noted that North America saw an extended spring season, while demand was high Central and South America.
The Potash segment saw higher realized prices, although there was a small decline in sales volumes, as well as higher brine management costs and depreciation expenses. Mosaic also reported record sales for MicroEssentials, its premium fertilizer product, of which it currently can produce as much as 2.3 million tons per year. Capital expenditures for the fourth quarter totaled $449 million.
Among the exceptional items that negatively affected Mosaic, pre-tax, in fourth-quarter 2012 were $21 million in asset retirement obligations related to closed facilities in the Phosphates segment and $18 million in unrealized losses on derivatives in the Potash segment. However, these were partly offset by $5 million in unrealized gains on derivatives in the Phosphates segment and $11 million in foreign currency transaction gains. Mosaic also began operations at the South Fort Meade in Florida and expects it to be at full production in August.
Industrial Info is tracking more than $7.3 billion in active Mosaic projects, including the $500 million, first-stage expansion of an underground potash mine and mill in Esterhazy, Saskatchewan, and the $500 million, second-stage expansion of an underground potash solution mine and mill in Belle Plaine, Saskatchewan. The Esterhazy project, which is part of a $2 billion, two-stage project to increase the 5.3 million-ton-per-year Esterhazy operation by 1.7 million tons per year, involves installing and upgrading the mine and milling equipment to increase capacity and add additional brine ponds to increase the withdrawal and injection rates. The Belle Plaine project, which is part of a three-phase expansion to increase production from 2.8 million to 4.8 million tons per year, involves expanding mine and mill to increase potash production. The projects are set to be completed in December 2012 and March 2013, respectively.
"I feel great about our strategic progress and the strength we can exert as the world's largest producer of phosphates and potash," Prokopanko said in a conference call.
Although the Phosphates segment was flat in overall sales volumes for the quarter and year, the Potash segment reported overall declines, with the biggest drop being the North American crop nutrient business:
"We project the global phosphate market will remain tight, given the prospects for record shipments in 2013 and continued nagging supply uncertainties," Prokopanko said in the conference call. "In the case of potash, the global market is stable. World shipments are projected to decline this year, as a result of a drop in demand in a few countries, particularly India, as well as a drawdown of large inventories in several of the major potash-consuming countries."
For more information, visit Industrial Info's North American Metals & Minerals Project Database.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.
Total net sales stood at $2.82 billion for the quarter, a 1.39% decrease from the same period last year, and $11.11 billion for the full year, an 11.77% increase from the 2011 fiscal year. In a press release, Jim Prokopanko, the president and chief executive officer of Mosaic, said that the Phosphates segment experienced "robust shipments worldwide," while farmers worldwide "applied high quantities of potash in the fiscal fourth quarter." He also noted that North America saw an extended spring season, while demand was high Central and South America.
The Potash segment saw higher realized prices, although there was a small decline in sales volumes, as well as higher brine management costs and depreciation expenses. Mosaic also reported record sales for MicroEssentials, its premium fertilizer product, of which it currently can produce as much as 2.3 million tons per year. Capital expenditures for the fourth quarter totaled $449 million.
Among the exceptional items that negatively affected Mosaic, pre-tax, in fourth-quarter 2012 were $21 million in asset retirement obligations related to closed facilities in the Phosphates segment and $18 million in unrealized losses on derivatives in the Potash segment. However, these were partly offset by $5 million in unrealized gains on derivatives in the Phosphates segment and $11 million in foreign currency transaction gains. Mosaic also began operations at the South Fort Meade in Florida and expects it to be at full production in August.
Industrial Info is tracking more than $7.3 billion in active Mosaic projects, including the $500 million, first-stage expansion of an underground potash mine and mill in Esterhazy, Saskatchewan, and the $500 million, second-stage expansion of an underground potash solution mine and mill in Belle Plaine, Saskatchewan. The Esterhazy project, which is part of a $2 billion, two-stage project to increase the 5.3 million-ton-per-year Esterhazy operation by 1.7 million tons per year, involves installing and upgrading the mine and milling equipment to increase capacity and add additional brine ponds to increase the withdrawal and injection rates. The Belle Plaine project, which is part of a three-phase expansion to increase production from 2.8 million to 4.8 million tons per year, involves expanding mine and mill to increase potash production. The projects are set to be completed in December 2012 and March 2013, respectively.
"I feel great about our strategic progress and the strength we can exert as the world's largest producer of phosphates and potash," Prokopanko said in a conference call.
Although the Phosphates segment was flat in overall sales volumes for the quarter and year, the Potash segment reported overall declines, with the biggest drop being the North American crop nutrient business:
- Phosphate sales volumes totaled 2.89 million tons for the quarter, a 1.72% increase from the fourth quarter of 2011. For the full year, phosphate sales volumes totaled 11.84 million tons, an 0.94% decrease from 2011. Results from the Phosphate sectors were as follows:
- North American crop nutrient sales volumes were reported to be 1.06 million tons, an 18.06% increase from the same period last year. For the full year, North American crop nutrient sales volumes totaled 3.75 million tons, an 8.86% increase from 2011.
- International crop nutrient sales volumes were reported to be 959,000 tons, a 0.31% decrease from fourth-quarter 2011. For the full year, international crop nutrient sales volumes totaled 3.81 million tons, a 7.43% decrease from 2011.
- Crop nutrient blend sales volumes were reported to be 516,000 tons, a 7.53% decrease from the same period last year. For the full year, crop nutrient blend sales volumes totaled 2.62 million tons, a 0.61% decrease from 2011.
- Feed phosphate sales volumes were reported to be 153,000 tons, a 14.18% increase from fourth-quarter 2011. For the full year, feed phosphate sales volumes totaled 621,000 tons, a 9.52% increase from 2011.
- Other phosphate-related sales volumes were reported to be 203,000 tons, a 30% decrease from the same period last year. For the full year, other phosphate-related sales volumes totaled 1.04 million tons, a 12.54% decrease from 2011.
- Potash sales volumes totaled 2.05 million tons for the quarter, a 6.01% decrease from fourth-quarter 2011. For the full year, potash sales volumes totaled 6.72 million tons, a 10.67% decrease from 2011. Results from the Potash sectors were as follows:
- North American crop nutrient sales volumes were reported to be 921,000 tons, a 0.22% increase from the same period last year. For the full year, North American crop nutrient sales volumes totaled 2.35 million tons, a 27.98% decrease from 2011.
- International crop nutrient sales volumes were reported to be 951,000 tons, a 13.15% decrease from fourth-quarter 2011. For the full year, international crop nutrient sales volumes totaled 3.67 million tons, a 1.1% increase from 2011.
- Non-agricultural potash sales volumes were reported to be 177,000 tons, a 6.63% increase from the same period last year. For the full year, non-agricultural potash sales volumes totaled 704,000 tons, an 11.04% increase from 2011.
"We project the global phosphate market will remain tight, given the prospects for record shipments in 2013 and continued nagging supply uncertainties," Prokopanko said in the conference call. "In the case of potash, the global market is stable. World shipments are projected to decline this year, as a result of a drop in demand in a few countries, particularly India, as well as a drawdown of large inventories in several of the major potash-consuming countries."
For more information, visit Industrial Info's North American Metals & Minerals Project Database.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.
