Terra Industries income nearly triples

Sioux City-Terra Industries Inc. reported net income of $203.4 million ($1.94 per share) on sales of $843.1 million for the second quarter ending June 30, compared to the year-ago $70.6 million ($.66 per share) and $692.5 million, respectively. Ammonia, UAN, and ammonium nitrate selling prices increased 48, 48, and 25 percent, respectively. Sales volumes of ammonia and AN increased 13 and 8 percent, respectively, while volumes of UAN were off 4 percent. They were affected by delayed product movement due to cool, wet conditions and flooding throughout much of the Midwest. UAN sales volumes were also reduced due to lower corn acres, which were down about 6 percent from 2007. Six-month net income was $304.9 million ($2.91 per share) on sales of $1.4 billion, up from the year-ago $77.9 million ($.73 per share) and $1.2 billion, respectively. The company said its Donaldsonville, La., ammonia plant is expected to come up in the third quarter. It will allow Terra to replace about 400,000 tons per year of imported ammonia, thereby realizing higher margins. Terra President and CEO Michael Bennett said higher selling prices helped offset higher gas costs. “Terra realized record earnings for the second quarter, reflecting not only a very positive nitrogen industry environment, but also excellent performance in all areas of the company, including joint ventures in Trinidad and the UK.” Bennett expects strong demand to continue for the remainder of 2008 as customers fill their storage capacity in anticipation of a robust spring in 2009.

* Nitrogen in thousand tons, gas in mmBtu