The Mosaic Co. reported fourth-quarter net earnings attributable to the company of $365.3 million on net sales of $3.15 billion, down from the year-ago $523.2 million and $4.48 billion, respectively. Adjusted EBITDA was $646 million, down from the year-ago $1.05 billion.
Mosaic beat the average estimate of major analysts (Bloomberg Consensus) for earnings and adjusted EBITDA, which were $283.2 million and $596.4 million, respectively.
Full-year net earnings were $1.16 billion on net sales of $13.7 billion, down from the year-ago $3.6 billion and $19.1 billion, respectively. Adjusted EBITDA was $2.76 billion down from 2022’s $6.2 billion.
“Mosaic successfully navigated a highly dynamic market in 2023,” said Bruce Bodine, President and CEO. “We delivered strong free cash flow and returned significant capital to shareholders while reinvesting in the business. Looking into 2024, Mosaic expects to continue to benefit from a strong phosphates market and is well positioned to deliver solid results as we optimize our low cost potash operations. In addition, we are focused on improving our phosphates production level, expanding our portfolio of value-added products, growing our leading presence in Brazil, and enhancing the overall efficiency of our operations.”
Mosaic reported that in response to current potash market conditions, it has decided to curtail production at its Colonsay mine in Saskatchewan. Bodine told analysts that the move demonstrates the company’s commitment to flexibly manage its network to assure that low cost sites like Belle Plaine and Esterhazy operate at capacity while Colonsay is only used when market conditions dictate.
Mosaic noted that it has completed the development of the Esterhazy K3 mine, which it said is the largest and one of the most efficient and low-cost potash complexes in the world. In addition, Mosaic added that Canpotex’s port at Portland, Ore., returned to normal operations in December after being idled since April 2023 (GM May 19, 2023).
Mosaic expects first-quarter potash sales volumes in the 2-2.2 million mt range with realized mine-gate MOP prices in the $225-$250/mt range. The company expects North American demand to remain robust and that demand in Southeast Asia and Brazil will improve as the year progresses.
Mosaic explained that lower phosphate results reflect the impact of lower prices and production challenges due to weather-related events and repairs of its sulfuric acid facilities in Louisiana, partially offset by lower raw material prices. It said phosphate prices stabilized in second-quarter 2023 and rose in the second-half, and it expects this to continue in 2024, as well as low raw material prices.
Mosaic expects a tight global supply of phosphate into 2024 with China’s exports expected to be capped as the domestic market is prioritized over exports. It said firm phosphate prices and low raw materials prices suggest that stripping margins will stay elevated for the foreseeable future.
Mosaic first-quarter phosphate guidance is for 1.6-1.8 million mt with DAP prices on an FOB basis averaging $580-$605/mt.
Mosaic Fertilizantes reported much lower net sales, with the company citing lower prices, inflationary cost pressures, and high-priced inventory. It said destocking for high-priced inventories was completed in second-quarter 2023 and that fourth-quarter distribution margins per mt were above historical norms.
Due to heavy lower margin nitrogen distribution in the first quarter, Mosaic Fertilizantes expects margins below historical norms for the quarter but expects margins to be within norms for the year.
| Potash (millions) | 4Q-23 | 4Q-22 | 2023 | 2022 |
| Sales Volume (000 mt) | 2.6 | 1.9 | 8.9 | 8.1 |
| Production Volume (000 mt) | 2.5 | 2.1 | 8.2 | 9.0 |
| Gross Margin per mt | 99 | 289 | 137 | 351 |
| Operating Earnings (million $) | 222 | 497 | 1,152 | 2,768 |
| Adjusted EBITDA | 322 | 597 | 1,471 | 3,117 |
| Sales (million $) | 758 | 1,136 | 3,200 | 5,200 |
| MOP Selling Price $/mt | 243 | 581 | 308 | 632 |
| Phosphates (millions) | 4Q-23 | 4Q-22 | 2023 | 2022 |
| Sales Volume (000 mt) | 1.6 | 1.6 | 7.0 | 6.6 |
| Production (Fin.) Vol. (000 mt) | 1.5 | 1.6 | 6.6 | 6.7 |
| Gross Margin per mt | 88 | 148 | 100 | 268 |
| Operating Earnings (million $) | 21 | 145 | 375 | 1,347 |
| Adjusted EBITDA | 259 | 348 | 1,227 | 2,219 |
| Sales (million $) | 1,070 | 1,310 | 4,700 | 6,200 |
| DAP Selling Price $/mt | 552 | 722 | 573 | 804 |
| Mosaic Fertilizantes (millions) | 4Q-23 | 4Q-22 | 2023 | 2022 |
| Sales Volume (000 mt) | 2.2 | 2.5 | 9.7 | 9.4 |
| Gross Margin per mt | 44 | 11 | 22 | 111 |
| Operating Earnings (million $) | 50 | (20) | 75 | 910 |
| Adjusted EBITDA | 111 | 29 | 327 | 1,049 |
| Sales (million $) | 1,192 | 1,910 | 5,700 | 8,300 |
| Avg Finished Price (Dest.) | 552 | 773 | 587 | 878 |