The Mosaic Co. more than doubled net income for the fourth quarter ending May 31, 2010, and exceeded many analysts’ expectations. Net income attributable to Mosaic was $396.1 million ($.89 per diluted share) on sales of $1.86 billion, up from the year-ago $146.9 million ($.33 per share) on sales of $1.59 billion.
“We are pleased with our strong fourth-quarter results,” said Jim Prokopanko, Mosaic president and CEO. “Crop nutrient application rates and shipments have snapped back from last year’s levels, and a strong recovery in both the phosphate and potash markets is underway.” He said the phosphate market is robust, that North American inventories are likely to remain below average throughout this fiscal year, and that demand remains strong, particularly in India, Brazil, and North America. On the potash side, Mosaic said significantly improved sales volumes were partially offset by a decline in selling prices.
Fourth-quarter phosphate operating income was $221.1 million on sales of $1.19 billion, compared to a year-ago loss of $79.2 million on sales of $1.19 billion. The company sold 2.33 million mt of phosphate versus the year-ago 2.5 million mt. The average DAP price was up, at $438/mt from the year-ago $365/mt. Ammonia prices were higher, at $309/mt from the year-ago $296/mt, while sulfur was lower, at $131/lt from the year-ago $201/lt.
Fourth-quarter potash income was $346.9 million on sales of $696.5 million, up from the year-ago $198.6 million on sales of $386.8 million. The company sold 1.83 million mt versus the year-ago 647,000 mt. The average MOP price was $336/mt, down from the year-ago $540/mt.
Net earnings for the year ending May 31 were down from the stellar results posted in the prior year. Net earnings were $827.1 million ($1.85 per share) on sales of $6.76 billion, down from $2.35 billion ($5.27 per share) on sales of $10.3 billion.
Fiscal year phosphate income was $349.5 million on sales of $4.73 billion, down from the year-ago income of $961.7 million on sales of $7.41 billion. Phosphate tons sold moved up to 11 million mt from the year-ago 8.95 million mt. The average DAP price was $327/mt, down from $726/mt in the same period last year. The average ammonia price was $265/mt, down from last year’s $524/mt, while sulfur was $71/lt, down from $485/lt a year ago.
Fiscal year potash income was $922.8 million on sales of $2.17 billion, down from the year-ago $1.4 billion on sales of $2.82 billion. Potash tons sold moved up to 5.54 million mt from the year-ago 5.05 million mt. The average MOP price was $352/mt, down from the year-ago $521/mt.
For the first quarter of fiscal 2011, Mosaic is estimating an average DAP price of $410-$440/mt and sales volumes of 2.8-3.2 million mt. Phosphate operating rates are expected to be at 85-90 percent.
For potash, Mosaic sees prices of $300-$330/mt and volumes of 1.2-1.5 million mt. Potash operating rates are expected at 60-65 percent due to planned seasonal turnarounds.