Oklahoma City-LSB Industries Inc. reported record net income and revenues for the year and fourth quarter ending Dec. 31, 2007. Annual net income was up 202.2 percent to $46.9 million ($1.84 per diluted share) on sales of $586.4 million, compared to 2006’s $15.5 million ($.76 per share) and $491.9 million, respectively. Fourth-quarter net income was $4.5 million ($.20 per share) on sales of $134.6 million, up from the year-ago $2.7 million ($.10 per share) and $123.7 million. LSB’s chemical/nitrogen business for the year 2007 reported operating income of $35.0 million on sales of $288.9 million, versus the year-ago $9.8 million and $260.6 million. Fourth-quarter chemical/nitrogen income was $7.9 million on sales of $66.4 million, compared to the year-ago $766,000 and $59.2 million, respectively. “Both of our core businesses turned in record performance in 2007,” said Jack Golsen, LSB CEO. “We are confident that we are in the right spot because of our energy saving and green products and the country’s quest for energy independence. We continue to dominate the niche markets we serve as our market share of key products continues to grow. The products of both of our businesses are a necessity for the future of our country.” For the year and fourth quarter LSB realized insurance recoveries of $3.8 million and $2.3 million, respectively, relating to business interruption claims at the Cherokee, Ala., nitrogen facility. Also in 2007, the company recognized income of $3.3 million related to a settlement of litigation.
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Earnings up 146 percent at Hanfeng in 2007
Toronto-Hanfeng Evergreen Inc. reported a 146 percent increase in net earnings for the year ending Dec. 31, 2007. Net earnings were C$19.4 million ($.34 per diluted share) on sales of $141.3 million for 2007, up from 2006’s $7.9 million ($.15 per share) and $59.8 million, respectively. “This was a year of great achievement for Hanfeng,” said Xindou Yu, Hanfeng CEO and president. “In every facet of our business, we met or exceeded our goals. Our design capacity grew by 86 percent, production by 130 percent and our sales by 136 percent, while profitability doubled. More importantly, we saw demand continue to increase as we sold virtually everything we produced in 2007, even in the wake of price increases.” Fourth-quarter net income was $6.8 million ($.11 per share) on sales of $54.6 million, compared to the year-ago $3.5 million ($.07 per share) and $24.3 million, respectively.
Bunge corrects financial statements
White Plains, N.Y.-Bunge Ltd. said March 3 that it is correcting net sales and cost of goods sold that were overstated in its 2007 unaudited quarterly financial statements and its Feb. 7, 2008 press release containing its preliminary results for 2007 (GM Feb. 11, p. 9). These corrections represent an approximately $7 billion reduction in net sales and cost of goods sold, and have no impact on Bunge’s previously reported volumes, gross profit, segment operating profit, net income, or earnings per share, or on the company’s consolidated balance sheets or statements of cash flows. The corrected financial information is included in Bunge’s 2007 annual report on Form 10-K filed today. Bunge identified these errors during its year-end closing process. This takes net sales down to $37.8 billion. The corrections resulted from Bunge’s review of its accounting for, and financial statement presentation of, certain transactions primarily in Bunge’s agribusiness segment. As a result of changes in certain systems in 2007, certain intercompany sales were classified as third-party transactions in both net sales and cost of goods sold and were not eliminated in the consolidation process. Additionally, certain transactions related to Bunge’s trade structured finance activities were reported on a gross basis in net sales and cost of goods sold. These transactions should have been reported on a net basis. The company has also reviewed and conducted reconciliations for 2005 and 2006 of sales accounts in subsidiary general ledger systems with the company’s consolidation and financial reporting system. Additionally, the company reviewed trade structured finance transactions for 2005 and 2006 to assure appropriate accounting treatment and financial statement presentation. As a result of these reviews, management has determined that the effect in 2006 and 2005 was immaterial. Bunge is remediating the control deficiencies that led to the need for these corrections, and which the company has determined constitute material weaknesses in its internal control over financial reporting in 2007.
Helena bowing out of warehouse site
West Palm Beach, Fla.-Helena Chemical Co. definitely won’t be building a fertilizer warehouse near the main entrance to the Arthur R. Marshall Loxahatchee National Wildlife Refuge despite press reports to the contrary, according to a senior planner with the county zoning office. “They’re not going to build in that location right at the entry way,” Carrie Rechenbacher told Green Markets. “They are looking at another site further to the west. There has been a lot of adamant opposition (to the refuge location).” Rechenbacher added that the Helena request was on the March 6 zoning commission agenda for withdrawal, although the press had reported the company had requested a delay in hopes of winning approval. So instead of asking for another delay, the Helena representatives apparently backed away from the plan in advance of the vote after planning and zoning staff recommended that the application be formally withdrawn. Ed Brister, Helena’s director of regulatory compliance and engineering at the corporate office in Tennessee, wouldn’t confirm the latest developments. Helena had no comment. Opposition to storing and selling fertilizers, pesticides, and other chemicals so close to the northern reaches of the Everglades stalled the project for a year. Concerns about chemical spills and traffic near the refuge were among the objections raised about the proposal for a 14,000-square-foot storage building and 2,520-square-foot office building on five acres of land. One press report stated that the company is working on a deal to swap land with the South Florida Water Management District, which owns the refuge land and other properties.
Helena may be on hook for Texas cleanup costs
Mission, Tex.-EPA Region 6 officials won’t say if Helena Chemical Co. will be on the hook for all or even part of the $6 million spent by federal and state agencies to clean up the old Helena plant that ceased operations in 1972. “We normally pursue cost recovery,” spokesman Dave Bary told Green Markets. “But that matter is under review by the enforcement staff, and we won’t know until the cost recovery staff makes a decision.” Bary did note, however, that there are more potentially responsible parties than just Helena. Cleanup has been on and off since the early 1980s at the site, where pesticides were formulated on a city block surrounded on three sides by homes. As a result of a lawsuit filed by EPA, former owners Helena Chemical and Tex-Ag Co. entered into a consent decree to clean up the contaminated property. In 1982 a district judge ruled all cleanup activities were complete. The state dug up the most highly contaminated soils and buried them in a repository onsite covered by asphalt. But the asphalt cap deteriorated over time and caused concern among residents, reported EPA, which in 2006 removed contaminated soils to a depth of 3½ feet and brought in clean backfill. A month ago, reported Bary, a remaining mix building was removed and soils sampled to see if additional contamination remains.
Ringbolt plans to acquire Utah potash leases
Vancouver-Ringbolt Ventures Ltd. said March 10 that it has signed a letter of agreement with an American private company to acquire potash leases in the Paradox Basin in Utah. Ringbolt says the United States Geological Survey estimates that the Paradox Basin contains 2 billion tons of potash. The company is pleased with the geological location of the leases on an ancient saltwater inlet and with the nature of the potash deposits. The Vancouver, B.C.-based Ringbolt describes itself as a junior resource company whose primary focus is to acquire and develop assets in the agricultural sector. It says it recognizes the need for ag products that by all accounts will stay fundamentally robust for the foreseeable future, due to the forever increasing population of the world and the strong demand from the biofuel industry. It noted that the total U.S. potash production in 2007 only accounted for 12 percent of U.S. consumption, and the balance (88 percent) had to be imported.
Bunge opts against public offering
White Plains, N.Y.-Bunge Ltd. said March 12 that it will not proceed with its proposed public offering of senior notes at this time due to unfavorable market conditions. “We have concluded that current conditions in the debt markets are not conducive to completing our offering at this time,” said Jacqualyn Fouse, CFO. “We have sufficient capital to manage our business, and we have decided to wait for a more attractive environment before returning to the debt markets.”
Bonaparte eyes Namibia phosphate deposit
West Perth, WA, Australia-Bonaparte Diamond Mines NL said March 12 that is has submitted tenement applications for an additional 6,000 km of phosphate exploration area identified within the regionally mapped zones of increased phosphate concentration off the cost of Namibia, in southern Africa. The 3,000 km project is south of Walvis Bay and is known as the Meob Project. Another 3,000 km project is north of the Bay and is known as the Rocky Point Project. Bonaparte says mapping indicates the areas have P205 content greater than 5 percent by weight, with core zones containing over 20 percent. Bonaparte says sampling results on 1,000 km at Meob shows that phosphate concentration of the recovered seabed sediment can be significantly enriched by a simple screening process to separate the fine fraction, a process which is well within the current tried and tested marine mining and dredging operations. The new applications have been submitted by Bonaparte Tungeni Joint Venture Company, a Namibian registered company in which Bonaparte’s Namibian partners, Tungeni Investments cc, hold a 30 percent interest, while Bonaparte is the operator with 70 percent. The applications are subject to processing by the Namibian Ministry of Mines and Energy. If successful, the venture will hold a total exploration area of 7,000 km. “We are working to consolidate a set of highly prospective properties to develop together with our Namibian partners as the basis for the establishment of a viable marine phosphate mining industry in Namibia,” said Michael Woodbourne, Bonaparte managing director. Bonaparte describes itself as a company focused on diamond producing, maintaining a portfolio of highly prospective projects located in the established diamond producing provinces in southern Africa and Australia. It claims to be the only company in Australia that conducts marine diamond exploration and is one of only a few companies internationally that owns a marine diamond sampling system.
Coffeyville Resources gets nod from Chamber
Sugar Land, Texas-The Coffeyville, Kan., Chamber of Commerce has awarded CVR Energy Inc.’s subsidiary, Coffeyville Resources LLC, the 2007 Industry of the Year Award. The award is given to an area business for its overall business growth, community involvement, and corporate philanthropy. “It is our way of saluting those companies who go above and beyond for our community,” said Lisa Kuehn, Chamber executive director. “Coffeyville Resources was chosen as the Industry of the Year not only for their economic and philanthropic contributions to Coffeyville, but also for their commitment to the community as it recovers from last summer’s record flooding of the Verdigris River.”
Management Briefs
Industry veteran Kim Colvin has joined Mississippi Phosphates Corp. as director of terminal development and procurement. He will assume responsibilities in the area of raw material procurement and take a lead role in the development of the company’s terminal assets and the marketing of terminal services.
“I am pleased to announce that MPC is broadening its senior staff with the addition of Kim Colvin,” said Ed McCraw, MPC chief operating officer. “He brings to us extensive experience from both domestic and international perspectives and is a proven leader with a demonstrated track record of success in the agriculture sector.”
Prior to joining MPC, Colvin served as an industry consultant and held senior management positions at Keytrade USA Inc., Duke Energy Merchants, PCS Sales, and International Minerals & Chemicals. A native of Jackson, Miss., Colvin relocated in March to MPC’s headquarters in Madison, Miss.
Agrium Inc. said March 10 that Derek Pannell has accepted an invitation to sit on Agrium’s board of directors commencing Feb. 27, 2008. A managing partner of Brookfield Asset Management Inc., Pannell is a director of Teck Cominco Ltd., Major Drilling Group International Inc., and Brookfield Infrastructure Partners LP. He was president and CEO of Noranda/Falconbridge from 2001 to October 2006 and vice president, operations, of Compañia Minera Antamina from 1999 – 2001. He is a graduate of Imperial College in London, England, and the Royal School of Mines, London, England (ARSM), and an engineer registered in Quebec and Peru.
Pannell succeeds Neil Carragher, who is retiring and has been on the Agrium board since 1996.
Viterra shareholders re-elected ten members of the board of directors March 12 and added two more. Joining the board are Bonnie DuPont and Larry Ruud. DuPont is a group vice president with Enbridge Inc. in Calgary. She earned her Master’s Degree from the University of Calgary and holds a Bachelor’s Degree (Great Distinction) with a focus in Program Administration & Evaluation and Psychology from the University of Regina.
Ruud is a partner with Meyers Norris Penny LLP and provides farm management consulting services in Alberta and B.C. He holds Master’s of Science and Bachelor’s of Science Degrees in Agricultural Economics from the University of Alberta. He owns and operates a farm near Vermilion, Alberta.
In other news, shareholders officially adopted the name Viterra Inc. for the company.
Hanfeng Evergreen Inc. said March 7 that it has appointed Brian Hayward and Lei Li to the board of directors, effective immediately. Hayward and Li replace Graham Warren and Kim Oishi, who are leaving the board to pursue other ventures. David Thomson will assume Warren’s position as chairman of the audit committee.