CF Industries Holdings Inc. reported record earnings attributable to common shareholders for the first quarter ending March 31, 2012, at $368.4 million ($5.54 per diluted share) on net sales of $1.53 billion, compared to the year-ago $282 million ($3.91 per share) on sales of $1.17 billion. Net sales, which were up 30 percent, were also a record for the quarter, as was EBITDA, which was $701.5 million, up from $585.1 million.

Results could have been even higher except for a non-cash $55.9 million pre-tax mark-to-market loss on natural gas derivatives, which reduced after-tax earnings per diluted share by $.52. Year-ago results included a $32.5 million pre-tax gain on the sale of four dry product warehouses, $19.9 million of accelerated amortization of loan costs related to retirement of a bank term loan, $2.1 million in restructuring and integration costs, and $700,000 non-cash mark-to-market gain on natural gas derivatives.

“We are pleased with the excellent financial results our company continues to produce,” said Stephen Wilson, CF chairman and CEO. “Record first quarter sales and earnings were underpinned by the strong demand that emerged as the quarter progressed and by the continuation of a favorable cost environment. Our team took full advantage of this opportunity by executing very well.”

CF said an exceptionally mild winter and early spring weather created favorable field conditions and pre-plant nutrient applications well ahead of normal schedules. The early application contributed to an increase in demand for ammonia and urea.

Nitrogen made the difference for CF, with gross margins up 50 percent to $662.1 million on net sales of $1.27 billion, compared to the year-ago $442.5 million on sales of $925.9 million. Tons of product sold moved up to 3.2 million st from the year-ago 2.84 million st. Ammonia sales volumes were 672,000 st at an average selling price of $598/st, compared to the year-ago 410,000 st ($494/st). CF said it was an unprecedented early start to the ammonia pre-plant season and higher expected corn acres. Company average price realizations increased 21 percent, reflecting a larger-than-normal percentage of agricultural ammonia in the sales mix. CF said its ammonia plants in aggregate ran at approximately 100 percent of rated capacity during the quarter.

Granular urea volumes were 758,000 st ($461/st), versus the year-ago 604,000 st ($371/st). The 25 percent volume increase was to serve corn pre-plant and strong wheat topdress. CF said it maximized its Donaldsonville, La., and Courtright, Ont., urea production to take advantage of attractive margin opportunities.

UAN volumes were off slightly, but prices were higher – 1.4 million st ($302/st) versus the year-ago 1.45 million st ($277/st). CF said that due to higher downsteam UAN inventories. it opted to favor urea sales. It said higher prices were due to favorably priced orders booked in earlier quarters; however, prices began moving up toward the end of the quarter. This trend has continued into the second quarter, as they have moved up in reaction to higher urea prices and strong demand in preparation for UAN sidedress applications. CF expects a strong UAN application season due to large plantings and tight supplies of urea and ammonia.

Ammonium nitrate volumes were up slightly, also with prices higher – 247,000 st ($259/st) versus 244,000 st ($251/st). Other nitrogen volumes were off slightly at 123,000 st from the year-ago 129,000 st.

CF’s average natural gas price for the quarter was $3.48/mmBtu, versus the year-ago $4.32/mmBtu.

While overall phosphate sales volumes were up, gross margins were off for that product group to $49.7 million on net sales of $255.9 million, compared to the year-ago $82.5 million on sales of $248.1 million. While total phosphate sales were up 17 percent, to 516,000 st from the year-

A major deadline looms for CVR Energy Inc. as billionaire investor Carl Icahn’s tender offer to acquire all outstanding shares of CVR’s common stock for $30 per share in cash plus a contingent cash payment right (CCP) expires at 11:59 p.m. New York City time May 4. The CVR board does not recommend that shareholders tender, as it believes that the company’s potential long-term value exceeds the tender offer price. However, the board said it agreed to drop its “poison pill” so that shareholders would be able to still sell their shares in the tender should they initially not opt to sell.

On May 3, the CVR Energy board sent a letter to stockholders detailing for them what would happen if Icahn is successful. If at least 31,661,040 shares (which
represents approximately 36 percent of the outstanding shares) are tendered in time, Icahn will have won control, as he already owns 15 percent of the shares. Thereafter, Icahn is required to close the tender offer and accept all tendered shares for payment. He is then required to immediately provide all remaining stockholders not wishing to remain minority stockholders in a controlled company with an additional 10-business day period, during which they may tender any remaining outstanding shares for the same $30 in cash plus a CCP. If after these periods Icahn achieves 90 percent or more of the shares, he must cause a merger to take place in which all remaining outstanding shares will be converted into the right to receive the same consideration as in the tender offer ($30 per share in cash plus a CCP), unless such holder chooses to exercise statutory appraisal rights. If Icahn does not hold 90 percent or more of the outstanding shares at the conclusion of the subsequent offering period, those shares that have not been tendered will remain outstanding.

If Icahn does not receive the required level of stockholder support on May 4, he has agreed to terminate his tender offer and the pending proxy contest for control of the CVR board.

It is Icahn’s plan to sell CVR, with shareholders receiving additional money from that sale under the CCP. In the meantime, CVR says it has contacted possible acquirers to determine their level of interest in a potential transaction. If Icahn’s tender offer is completed, the board said it will supply him with information related to this process to assist him in the marketing process that he is required to undertake for 60 days beginning promptly after the completion of the tender offer.

In the meantime, the CVR nitrogen business – CVR Partners LP – released first-quarter results May 1 showing that net earnings nearly doubled, to $30.2 million ($.41 per basic and diluted unit) on net sales of $78.3 million, compared to the year-ago $16.7 million on sales of $57.4 million. Adjusted EBITDA was $38 million, up from the year-ago $25.9 million.

CVR said first-quarter UAN and ammonia prices were up at 51 percent and 9 percent, respectively. UAN was $313/st FOB, up from $207/st, while ammonia was $613/st, up from $564/st. UAN sales volumes were off at 158,300 st from 179,300 st, while ammonia was up slightly, to 29,900 st from 27,300 st. CVR produced 89,300 st of ammonia, of which 25,000 st was available for sale, while the rest was upgraded to 154,600 st of UAN. This compares to the year-ago ammonia production of 105,300 st, with 35,200 st available for sale and the remainder going into 170,600 st of UAN.

“We are very pleased with our financial performance during the first quarter of 2012,” said Byron Kelley, CVR Partners president and CEO. “Lower production volumes due to unscheduled down time for plant maintenance in March were more than offset by higher sales prices for our products in the first quarter of this year as compared to the first quarter of 2011. In addition, given the strong pricing environment we have seen during

Israel Chemicals Ltd. (ICL) is expanding its specialized fertilizer operations in the U.S. Everris Americas (formerly Scotts Global Professional), an ICL Specialty Fertilizers subsidiary, has acquired the manufacturing capacity of X-Calibur Plant Health Co. The purchase includes a fertilizer coating line and associated handling, processing, and packaging equipment located in Summerville, S.C. The financial details of the acquisition were not released.

“This is part of ICL’s strategy to build leadership in the specialized fertilizer market and to diversify their product mix,” said Jonathan Kreizman, chemical industry analyst at Clal Finance, a leading Tel Aviv-based investment bank. He predicted that ICL would continue to make relatively small investments in this sector as part of the company’s strategy to reduce dependence on potash.

ICL, a leading global fertilizer and industrial chemical company, said that the equipment provides Everris with additional manufacturing capabilities to more rapidly bring its new products to market, including an innovative controlled-release fertilizer technology currently under development by Everris’ Global R&D center in the Netherlands. “Purchasing the X-Calibur equipment provides us with an ideal solution for our expansion needs,” said Ariana Cohen, president of Everris Americas. The equipment is located near Everris’ Charleston production plant, where the company has its controlled-release fertilizer production facilities. Cohen added that the company needs additional manufacturing capabilities to bring its new controlled-release fertilizer technology from concept to the marketplace.