US Mosaic’s Q4 net earnings fall on lower phosphate, potash prices

11 February 2014 14:48  [Source: ICIS news]

LONDON (ICIS)--Mosaic’s fourth-quarter 2013 net earnings fell steeply to $129m from $616m for the same period in the previous year, as sales fell to $2.2bn from $2.4bn year on year, the US-based phosphate and potash fertilizers producer said on Tuesday.

Mosaic’s operating earnings were $179m, down from $463m in the fourth quarter of 2012, mainly offset by lower realised prices on record phosphate and strong potash sales volumes.

“While our results for the fourth quarter reflect the low market prices for potash and phosphates, current market conditions are improving,” said Jim Prokopanko, president and CEO of Mosaic.

“Market dynamics are unfolding as we expected they would, with sales volumes increasing before prices; in fact, we shipped a record volume of phosphates during the quarter, and potash volumes increased significantly.”

Full-year net sales were $9.0bn, down from $10bn in the previous year, while operating earnings were $1.3bn, down from $2.2bn, primarily driven by low potash and phosphate prices globally and lower phosphate raw materials costs.

Phosphates net sales were $1.6bn in the fourth quarter, down 6% year on year as higher sales volumes were more than offset by lower finished product prices.

On the production side, Mosaic's Q4 North American finished phosphate production fell almost 10% to 2m tonnes from 2.2m tonnes in the same period of the year prior, while Q4 potash production slipped to 1.7m tonnes from 1.8m tonnes.

Potash net sales totalled $652m for the fourth quarter, down from $726m, as higher shipment volumes were more than offset by a 30% decline in average realized muriate of potash (MOP) prices.

The producer also said that its Board of Directors has authorised a $1bn share repurchase programme.

By: Sylvia Traganida

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