Nutrien Ltd. reported a 71% drop in first-quarter net earnings, to $165 million on sales of $5.4 billion, compared to the year-ago $576 million and $6.12 billion, respectively. Nutrien cited primarily lower net fertilizer selling prices, partially offset by increased Retail earnings, higher fertilizer sales volumes, and lower natural gas costs. Gross margin was $1.54 billion, down from $1.91 billion, while adjusted EBITDA was off 26%, to $1.06 billion from $1.42 billion.
“We continued to see strong crop input demand, a normalization of product margins for our North American Retail business, and increased global potash shipments in the first quarter,” said President and CEO Ken Seitz. “Our results highlighted the capabilities of our flexible, low-cost production assets and downstream distribution network to efficiently supply our customers’ needs.”
Nutrien Retail guidance of $1.65-$1.85 billion in adjusted EBITDA reflects expectations for increased crop nutrient sales and margins in North America for the first half, the company said. It expects corn plantings of about 90 million acres and soybeans at 87 million, and said application rates have been strong, though wet weather has caused delays in the Cornbelt.
“We expect growth in Retail earnings and fertilizer sales volumes compared to the prior year and have maintained our 2024 guidance ranges,” Seitz said. “Our focus remains on strengthening our capability to serve growers and enhancing our core businesses to improve the quality of our earnings and free cash flow.”
In Brazil, Nutrien said safrinha corn acreage has exceeded expectations and it foresees improved soybean margins in the second half. Retail guidance assumes a full-year of earnings from retail assets in Argentina, Chile, and Uruguay, which Nutrien has up for sale (GM April 19, p. 1).
The company added that Australian conditions remain supportive for the upcoming growing season and that the Indian monsoon is projected to produce average to above-average precipitation, which supports yield potential and grower demand for inputs.
Nutrien said potash supply and demand has been relatively balanced, with strong demand in North America as channel inventories have been tight. It has maintained a 2024 full-year potash shipment forecast of 68-71 million mt.
Nutrien said the US nitrogen supply and demand balance remains relatively tight, particularly for ammonia and UAN, with net nitrogen imports down 21% on a fertilizer year basis compared to historical averages. The company said its 10.6-11.2 million mt 2024 annual sales volume guidance assumes higher operating rates at its North American and Trinidad plants, as well as growth in sales and upgraded products such as urea and UAN.
Nutrien said phosphate fertilizer prices remained firm through the first quarter due to strong demand in the Northern Hemisphere, supportive Indian DAP purchases, Chinese export restrictions, and production outages. However, it said prices have softened in the second quarter driven by lower seasonal demand.
Nutrien maintained its regular quarterly cash dividend at 54 cents per share.
| Retail (millions) | 1Q-24 | 1Q-23 |
| Adjusted EBITDA | 77 | (34) |
| Gross Margin | 747 | 615 |
| Total Sales | 3,308 | 3,422 |
| CN Sales | 1,309 | 1,335 |
| CN Margins | 254 | 141 |
| CN Volume (000 mt) | 2,382 | 2,040 |
| CN gross margin per mt | 106 | 69 |
| Potash (millions) | 1Q-24 | 1Q-23 |
| Adjusted EBITDA | 530 | 676 |
| Gross Margin | 455 | 697 |
| Total Sales | 813 | 1,002 |
| Sales Volume (000 mt) | 3,413 | 2,636 |
| Avg ($/mt) | 238 | 380 |
| Nitrogen (millions) | 1Q-24 | 1Q-23 |
| Adjusted EBITDA | 464 | 676 |
| Gross Margin | 307 | 541 |
| Total Sales | 911 | 1,312 |
| Sales Volume (000 mt) | 2,507 | 2,357 |
| Avg ($/mt) | 326 | 500 |
| Gas Costs ($/mmBtu) | 3.20 | 4.85 |
| Phosphate (millions) | 1Q-24 | 1Q-23 |
| Adjusted EBITDA | 121 | 137 |
| Gross Margin | 65 | 87 |
| Total Sales | 437 | 514 |
| Sales Volume (000 mt) | 620 | 548 |
| Avg ($/mt) | 689 | 814 |