Canada’s PotashCorp Q1 net profit up 13% on improved demand

25 April 2013 12:08  [Source: ICIS news]

LONDON (ICIS)--Potash Corporation of Saskatchewan’s (PotashCorp’s) net profit for the first quarter of 2013 climbed 13% to $556m (€428.1m) year on year as a result of improved global demand, the Canada-based fertilizer producer said on Thursday.

Sales for the three months to the end of March 2013 were up 20% compared to the same period in 2012. Increased demand and “historically” strong first-quarter nitrogen pricing helped to push the company’s gross margin to $867m, compared to $698m in the first quarter of 2012.

“We had significant growth in our potash performance as global buyers returned to the market in earnest after taking a brief pause late in 2012. This environment enabled us to deliver earnings near the top end of our guidance and laid the foundation for what we believe will be a successful year,” said PotashCorp CEO Bill Doyle.

First-quarter domestic shipments from North American potash producers were up 56% compared to the same period last year, driven by Spring demand from farmers, with demand remaining high past the end of the quarter, the company said.

Export rates were also up at 74%, driven by China, India and Brazil, PotashCorp added.

“With China’s early settlement of potash supply contracts and strong demand in Brazil, shipments accelerated during the quarter, culminating in a monthly export record in March. Indian customers returned to the potash market, although movement was limited as new contracts with major suppliers were not settled until mid-quarter,” the company said in an earnings statement.

The company predicted that 2013 would be a “recovery year” for the potash sector, stating that the need for farmers to maximise yields is resulting in a strong focus on soil fertility and crop nutrition.

PotashCorp is predicting full-year earnings per share of $2.75-$3.25, compared to $2.36 per share for the full-year 2012.

($1 = €0.77)

By: Tom Brown
+44 208 652 3214

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