US Mosaic fiscal Q4 2013 net earnings down by 4.2% at $485.9m

16 July 2013 12:51  [Source: ICIS news]

LONDON (ICIS)--Mosaic’s fiscal 2013 Q4 net earnings fell by 4.2% year on year to $485.9m (€374.1m) as sales fell on lower selling prices, the US-based fertilizer firm said on Tuesday.

For the three months ended 31 May 2013, Mosaic's sales fell to $2.69bn from $2.82bn in the same period a year before, while operating earnings during the quarter were $621m, down from $671m a year ago, “as record potash and strong phosphate sales volumes were more than offset by lower realised prices”.

Jim Prokopanko, president and CEO of Mosaic, said: “Mosaic delivered outstanding results despite difficult external factors such as the late and compressed North American spring planting season, and additional logistical challenges.”

For the year ended 31 May 2013, net income was $1.89bn, down from $1.93bn reported during the company’s fiscal 2012, while net sales were $9.97bn, down from $11.1bn a year ago.

Full-year operating earnings throughout the group’s fiscal 2013 were $2.21bn, a 15% decrease year on year.

“[Full-year] lower net sales and operating earnings for the year were primarily driven by lower realised prices for both potash and phosphate, partially offset by higher potash volumes,” Mosaic said.

Looking ahead, Prokopanko said: “We are beginning to see the benefits of the expansion projects that we started five years ago.

"We continue to forecast calendar 2013 will be a near record year for potash shipments, and that the world will need our new capacity. Our decision to defer the next phase of the expansions is primarily a reflection of the current construction cost environment, though we will continue to monitor the global supply and demand outlook for potash. We expect the delay will result in higher returns for these projects.”

He added: “Despite near-term softness, the phosphate market looks balanced over the medium term, with expected strong demand growth absorbing new supply. Longer term, we continue to project constructive fundamentals, which bodes well for our investment in the Saudi Arabian joint venture."

Mosaic in March announced plans to develop a $7bn phosphate fertilizer project in Saudi Arabia with local partners.

The company said it entered into a “Heads of Agreement” with Saudi Arabian Mining Company (Ma'aden) and Saudi Basic Industries Corporation (SABIC) under which the companies intend to enter a joint venture to develop integrated phosphate production facilities at the Wa'ad Al Shammal Minerals Industrial City in northern Saudi Arabia.

($1 = €0.77)


By: Franco Capaldo
+44 (0)20 8652 3214



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