PLYMOUTH, Minn., Oct. 30, 2014 /PRNewswire/ -- The Mosaic
Company (NYSE: MOS) today reported third quarter 2014 net earnings
of $202 million, up from $124 million a year ago. Earnings per diluted
share were $0.54 in the quarter
compared to $0.29 last year. Notable
items negatively impacted third quarter 2014 net earnings by
$11 million, or $0.02 per share. Third quarter 2013 notable items
negatively impacted prior year net earnings by $95 million, or $0.22 per share. Mosaic's net sales in the third
quarter of 2014 were $2.3 billion, up
from $1.9 billion last year. Gross
margin during the quarter was $415
million, up from $387 million
a year ago, driven by higher phosphate and potash sales volumes.
Operating earnings during the quarter were $277 million, up from $144
million a year ago.
"Mosaic delivered improved year-over-year performance despite
weakness in the broader agricultural sector," said Jim Prokopanko, President and Chief Executive
Officer. "The improving demand momentum for both potash and
phosphates that started in the fourth quarter of 2013 continued. We
are on pace to deliver more tonnes this year than in any of the
last five years, and close to the records of 2008."
"We continued to effectively execute our many recent strategic
initiatives. We completed our share repurchase agreement with the
Margaret A. Cargill Trusts and continued to return capital to
shareholders. In addition, the integration of the former CF
Industries phosphate business in Central
Florida is proceeding well, we are progressing toward
completion of the acquisition of ADM's fertilizer distribution
business in Brazil, and the
Ma'aden phosphate joint venture is rapidly advancing. Our work to
generate cost savings of $500 million
over the next five years is ahead of schedule, helping ensure that
Mosaic remains a low-cost producer."
Cash flow provided by operating activities in the third quarter
of 2014 was $489 million compared to
negative $45 million in the prior
year. Third quarter 2014 cash flows reflect strong sales volumes.
Capital expenditures totaled $188
million in the quarter. Mosaic returned $469 million to shareholders during the quarter,
leaving total cash and cash equivalents at $3.0 billion. Total long-term debt was
$3.8 billion as of September 30, 2014.
Business Highlights
- Mosaic's growth projects continued to progress as planned:
- The Company expects to close the previously announced
acquisition of Archer Daniels Midland's fertilizer distribution
business in Brazil and
Paraguay by the end of 2014.
- The final potash expansion project, the Esterhazy K3 mine shafts, continues on time
and on budget, with both shafts more than 1,700 feet below
surface.
- The MicroEssentials® expansion at the New Wales facility is
progressing according to plan.
- The Ma'aden phosphate joint venture is rapidly advancing, with
engineering, procurement and construction activities well
underway.
- The CF Industries' phosphate business integration is on pace to
achieve pre-tax synergies of $40 to $50
million in 2015.
- Mosaic also made significant progress toward optimizing its
portfolio of assets and generating further efficiencies:
- Mosaic sold its Hersey,
Michigan salt mine, and signed an agreement to sell its
distribution business in Argentina. Subsequent to the quarter end, the
Company also ceased operations in Chile.
- Mosaic continued to execute and began to realize benefits of an
enterprise-wide initiative focused on achieving $500 million in annual operating cost savings
over the next five years.
- The Company is moving forward with front-end engineering and
design (FEED) to evaluate further debottlenecking of its Faustina
ammonia facility.
- The Company's recordable injury frequency rate improved by
almost 11 percent year-to-date in 2014 compared to record setting
results in the same period last year.
- As of October 27 year to date,
Mosaic repurchased 55.1 million shares, or $2.6 billion, at an average price of $46.96 per share, including 3.6 million common
shares purchased in the open market.
Phosphates
Phosphates
Results
|
3Q 2014
Actual
|
3Q 2014
Guidance
|
Average DAP Selling
Price
|
$461
|
$440 to
$470
|
Sales
Volume
|
3.3 million
tonnes
|
3.3 to 3.6 million
tonnes
|
Processed Phosphate
Production
|
85% of operational
capacity
|
Approaching 90%
range
|
"Mosaic's focus on growing operating earnings in phosphates is
evident in this quarter's results," Mr. Prokopanko said. "Despite
increasing raw material costs, logistical issues and lower grain
prices, Mosaic sold more tonnes at higher prices with a notably
improved margin per tonne. We have high expectations for our
phosphates business."
Net sales in the Phosphates segment were $1.7 billion for the third quarter, up from
$1.4 billion last year as a result of
higher sales volumes and higher finished product prices. Gross
margin was $294 million, or 18
percent of net sales, compared to $193
million, or 14 percent of net sales, for the same period a
year ago. The year-over-year change in gross margin dollars
reflects higher sales volumes and higher finished product prices,
partially offset by lower fixed cost absorption. Operating earnings
were $239 million, up from
$58 million last year.
The third quarter average DAP selling price, FOB plant, was
$461 per tonne, compared to
$436 per tonne a year ago. Total
sales volumes were 3.3 million tonnes in the phosphates segment, up
from 2.7 million tonnes last year.
Mosaic's finished phosphate production was 2.5 million tonnes,
or 85 percent of current operational capacity, up from 2.1 million
tonnes, or 88 percent of operational capacity, a year ago.
Potash
Potash
Results
|
3Q 2014
Actual
|
3Q 2014
Guidance
|
Average MOP Selling
Price
|
$291
|
$275 to
$295
|
Sales
Volume
|
1.8 million
tonnes
|
1.8 to 2.0 million
tonnes
|
Potash
Production
|
62% of operational
capacity
|
Low 70%
range
|
"Despite production issues which were primarily weather related,
Mosaic delivered similar costs per tonne in Potash compared to last
year," Mr. Prokopanko said. "Mosaic is making notable progress on
cost savings initiatives in an environment of growing demand and
lean channel and producer inventories. We are well positioned to
take advantage of improving potash fundamentals."
Net sales in the Potash segment totaled $593 million for the third quarter, up from
$523 million last year, as higher
shipment volumes were partially offset by a 15 percent decline in
average realized MOP prices. Gross margin was $131 million, or 22 percent of net sales,
compared to $184 million, or 35
percent of net sales, a year ago. The year-over-year decrease in
gross margin was driven by lower realized prices, lower fixed cost
absorption, higher Canadian resource taxes and higher depreciation
expense, partially offset by lower plant spending and higher sales
volumes.
The third quarter average MOP selling price, FOB plant, was
$291 per tonne, down from
$342 a year ago. The Potash segment's
total sales volumes for the quarter were 1.8 million tonnes, up
from 1.4 million tonnes a year ago, driven by higher demand for the
product.
Potash production was 1.7 million tonnes, or 62 percent of
operational capacity, down from 2.0 million tonnes, or 73 percent
of operational capacity a year ago, as a result of timing of
turnarounds as well as weather-related down time at the
Carlsbad, New Mexico and
Belle Plaine, Saskatchewan
mines.
Other
SG&A expenses were $84 million
for the third quarter, compared with $94
million last year. The year-over-year decrease was primarily
driven by the timing of annual equity grants related to the change
in Mosaic's fiscal year end.
The effective tax rate, excluding discrete items, increased
during the current quarter, reflecting an increase in Canadian
repatriation amounts as a result of higher profit expectations at
Mosaic's Canadian operations.
Financial Guidance
"We've invested for growth, and the investments we've made and
actions we've taken are beginning to deliver benefits," Mr.
Prokopanko said. "This is a cyclical industry in which value is
created by investing during the trough and we have done exactly
that. Going into 2015 we see continued demand momentum, and feel
Mosaic is well positioned for growth as fundamentals improve."
Total sales volumes for the Phosphates segment are expected to
range from 2.5 to 2.8 million tonnes for the fourth quarter of
2014, compared to 3.4 million tonnes last year. Mosaic's realized
DAP price, FOB plant, for the fourth quarter is estimated to range
from $430 to $450 per tonne. Mosaic's
gross margin rate in the segment is expected to be in the mid-teens
percent range during the fourth quarter. The operating rate in the
segment is expected to be in the 70 to 80 percent range reflecting
on-going production curtailment to limit high cost inventory
build-up.
Total sales volumes for the Potash segment are expected to range
from 2.0 to 2.3 million tonnes for the fourth quarter of 2014,
compared to 1.9 million tonnes last year. Mosaic's realized MOP
price, FOB plant, for the fourth quarter, is estimated to range
from $275 to $295 per tonne. Mosaic's
gross margin rate in the segment is expected to be in the mid 30
percent range during the fourth quarter. The operating rate in the
segment is expected to be in the 85 to 90 percent range.
For the 2014 full year, Mosaic estimates:
- SG&A expenses to range from $380 to
$395 million, including acquisition and integration related
increases, lowered again from the beginning of the year estimate of
$400 to $425
million reflecting progress on cost savings
initiatives.
- Canadian resource taxes and royalties to range from
$175 to $200 million, narrowed from
the prior estimate of $170 to $210
million.
- Brine management costs of approximately $200 million.
- The effective tax rate to be in the upper 20 percent range,
excluding any discrete tax items. The current year effective tax
rate, excluding discrete items, is elevated as a result of the
repatriation of cash generated by Mosaic's Canadian operations and
is expected to return to the low to mid 20 percent range in
2015.
- Capital expenditures and equity investments, including the
Ma'aden phosphate joint venture, in the range of $1.0 to $1.2 billion, down $200 million primarily due to deferral of
expenditures into 2015.
About The Mosaic Company
The Mosaic Company is one of the world's leading producers and
marketers of concentrated phosphate and potash crop nutrients.
Mosaic is a single source provider of phosphate and potash
fertilizers and feed ingredients for the global agriculture
industry. More information on the Company is available at
www.mosaicco.com.
Mosaic will conduct a conference call on Thursday, October 30, 2014 at 9:00 a.m. EDT to discuss third quarter 2014
earnings results as well as global markets and trends. Presentation
slides and a simultaneous webcast of the conference call may be
accessed through Mosaic's website at www.mosaicco.com/investors.
This webcast will be available up to one year from the time of the
earnings call.
This document contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Such statements include, but are not limited to, statements about
the Northern Promise Joint Venture, the acquisition and assumption
of certain related liabilities of the Florida phosphate assets of CF Industries,
Inc. ("CF") and Mosaic's ammonia supply agreements with CF;
repurchases of stock; other proposed or pending future transactions
or strategic plans and other statements about future financial and
operating results. Such statements are based upon the current
beliefs and expectations of The Mosaic Company's management and are
subject to significant risks and uncertainties. These risks and
uncertainties include but are not limited to risks and
uncertainties arising from the ability of the Northern Promise
Joint Venture to obtain additional planned funding in acceptable
amounts and upon acceptable terms, the future success of current
plans for the Northern Promise Joint Venture and any future changes
in those plans; difficulties with realization of the benefits of
the transactions with CF, including the risks that the acquired
assets may not be integrated successfully or that the cost or
capital savings from the transactions may not be fully realized or
may take longer to realize than expected, or the price of natural
gas or ammonia changes to a level at which the natural gas based
pricing under one of the long term ammonia supply agreements with
CF becomes disadvantageous to Mosaic; customer defaults; the
effects of Mosaic's decisions to exit business operations or
locations; the predictability and volatility of, and customer
expectations about, agriculture, fertilizer, raw material, energy
and transportation markets that are subject to competitive and
other pressures and economic and credit market conditions; the
level of inventories in the distribution channels for crop
nutrients; changes in foreign currency and exchange rates;
international trade risks and other risks associated with Mosaic's
international operations and those of joint ventures in which
Mosaic participates, including the risk that protests against
natural resource companies in Peru
extend to or impact the Miski Mayo mine; changes in government
policy; changes in environmental and other governmental regulation,
including greenhouse gas regulation, implementation of numeric
water quality standards for the discharge of nutrients into
Florida waterways or efforts to
reduce the flow of excess nutrients into the Mississippi River
basin, the Gulf of Mexico or
elsewhere; further developments in judicial or administrative
proceedings, or complaints that Mosaic's operations are adversely
impacting nearby farms, business operations or properties;
difficulties or delays in receiving, increased costs of or
challenges to necessary governmental permits or approvals or
increased financial assurance requirements; resolution of global
tax audit activity; the effectiveness of Mosaic's processes for
managing its strategic priorities; adverse weather conditions
affecting operations in Central
Florida, the Mississippi River basin, the Gulf Coast of
the United States or Canada, and including potential hurricanes,
excess heat, cold, snow, rainfall or drought; actual costs of
various items differing from management's current estimates,
including, among others, asset retirement, environmental
remediation, reclamation or other environmental regulation,
Canadian resources taxes and royalties, the liabilities Mosaic
assumed in the Florida phosphate
assets acquisition, or the costs of the Northern Promise Joint
Venture, its existing or future funding and Mosaic's commitments in
support of such funding; reduction of Mosaic's available cash and
liquidity, and increased leverage, due to its use of cash and/or
available debt capacity to fund share repurchases, financial
assurance requirements and strategic investments; brine inflows at
Mosaic's Esterhazy, Saskatchewan,
potash mine or other potash shaft mines; other accidents and
disruptions involving Mosaic's operations, including potential mine
fires, floods, explosions, seismic events or releases of hazardous
or volatile chemicals, as well as other risks and uncertainties
reported from time to time in The Mosaic Company's reports filed
with the Securities and Exchange Commission. Actual results may
differ from those set forth in the forward-looking statements.
For the three months ended September 30, 2014, the Company
reported the following notable items which, combined, negatively
impacted earnings per share by $0.02:
|
|
|
|
|
|
Amount
|
|
Tax
effect
|
|
EPS impact
|
Description
|
|
Segment
|
|
Line
item
|
|
(in millions)
|
|
(in millions)
|
|
(per share)
|
Share
repurchase
|
|
Consolidated
|
|
Interest (income)
expense
|
|
$
|
(5)
|
|
|
$
|
—
|
|
|
$
|
(0.01)
|
|
Severance
|
|
Corporate
|
|
Other operating
expense
|
|
3
|
|
|
(1)
|
|
|
0.01
|
|
Foreign currency
transaction gain
|
|
Consolidated
|
|
Foreign currency
transaction (gain) loss
|
|
(27)
|
|
|
8
|
|
|
(0.06)
|
|
Unrealized (gain)
loss on derivatives
|
|
Potash
|
|
Cost of goods
sold
|
|
23
|
|
|
(6)
|
|
|
0.04
|
|
Adjustments to
Argentine assets held for sale
|
|
Phosphates
|
|
Other operating
expense
|
|
(18)
|
|
|
5
|
|
|
(0.03)
|
|
Gain on sale of
Hersey
|
|
Potash
|
|
Other operating
expense
|
|
(14)
|
|
|
4
|
|
|
(0.03)
|
|
Carlsbad
restructuring expense
|
|
Potash
|
|
Restructuring
expense
|
|
67
|
|
|
(28)
|
|
|
0.10
|
|
Total Notable
Items
|
|
|
|
|
|
$
|
29
|
|
|
$
|
(18)
|
|
|
$
|
0.02
|
|
For the three months ended September 30, 2013, the Company
reported the following notable items which, combined, negatively
impacted earnings per share by $0.22:
|
|
|
|
|
|
Amount
|
|
Tax effect
|
|
EPS impact
|
Description
|
|
Segment
|
|
Line
item
|
|
(in millions)
|
|
(in millions)
|
|
(per
share)
|
Hersey write-down of
long lived assets
|
|
Potash
|
|
Loss on write down of
assets
|
|
$
|
48
|
|
|
$
|
(17)
|
|
|
$
|
0.07
|
|
Write-off of initial
engineering costs for ammonia plant
|
|
Phosphates
|
|
Loss on write down of
assets
|
|
25
|
|
|
(9)
|
|
|
0.04
|
|
Argentina write-down
to fair value
|
|
Phosphates
|
|
Loss on write down of
assets
|
|
50
|
|
|
—
|
|
|
0.12
|
|
Total Write
Downs
|
|
|
|
|
|
123
|
|
|
(26)
|
|
|
0.23
|
|
Discrete tax
items
|
|
Consolidated
|
|
Tax
provision
|
|
—
|
|
|
(17)
|
|
|
(0.04)
|
|
Settlement of mineral
interests
|
|
Potash
|
|
Other operating
expense
|
|
9
|
|
|
(2)
|
|
|
0.02
|
|
Fees related to
purchase of CF phosphate assets
|
|
Consolidated
|
|
Other operating
expense
|
|
4
|
|
|
(1)
|
|
|
0.01
|
|
Foreign currency
transaction loss
|
|
Consolidated
|
|
Foreign currency
transaction (gain) loss
|
|
30
|
|
|
(6)
|
|
|
0.05
|
|
Unrealized (gain)
loss on derivatives
|
|
Potash
|
|
Cost of goods
sold
|
|
(23)
|
|
|
5
|
|
|
(0.05)
|
|
Unrealized (gain)
loss on derivatives
|
|
Phosphates
|
|
Cost of goods
sold
|
|
(1)
|
|
|
—
|
|
|
—
|
|
Total Notable
Items
|
|
|
|
|
|
$
|
142
|
|
|
$
|
(47)
|
|
|
$
|
0.22
|
|
Condensed
Consolidated Statements of Earnings
|
(in millions,
except per share amounts)
|
|
|
|
|
|
The Mosaic
Company
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
Nine months ended
September 30,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Net sales
|
|
$
|
2,250.7
|
|
|
$
|
1,908.7
|
|
|
$
|
6,677.2
|
|
|
$
|
6,839.9
|
Cost of goods
sold
|
|
1,836.0
|
|
|
1,521.8
|
|
|
5,329.7
|
|
|
5,146.0
|
Gross
margin
|
|
414.7
|
|
|
386.9
|
|
|
1,347.5
|
|
|
1,693.9
|
Selling, general and
administrative expenses
|
|
83.9
|
|
|
94.4
|
|
|
291.3
|
|
|
302.3
|
(Gain) loss on assets
sold and to be sold
|
|
(31.7)
|
|
|
122.8
|
|
|
(26.1)
|
|
|
122.8
|
Carlsbad
restructuring expense
|
|
67.0
|
|
|
—
|
|
|
67.0
|
|
|
—
|
Other operating
expense
|
|
18.2
|
|
|
25.6
|
|
|
68.1
|
|
|
107.9
|
Operating
earnings
|
|
277.3
|
|
|
144.1
|
|
|
947.2
|
|
|
1,160.9
|
Gain (loss) in value
of share repurchase agreement
|
|
5.3
|
|
|
—
|
|
|
(60.2)
|
|
|
—
|
Interest (expense)
income, net
|
|
(25.2)
|
|
|
1.8
|
|
|
(76.6)
|
|
|
6.0
|
Foreign currency
transaction gain (loss)
|
|
27.1
|
|
|
(29.6)
|
|
|
31.8
|
|
|
9.6
|
Other income
(expense)
|
|
0.1
|
|
|
0.4
|
|
|
(6.1)
|
|
|
2.6
|
Earnings from
consolidated companies before income taxes
|
|
284.6
|
|
|
116.7
|
|
|
836.1
|
|
|
1,179.1
|
Provision for
(benefit from) income taxes
|
|
77.6
|
|
|
(6.6)
|
|
|
157.7
|
|
|
253.4
|
Earnings from
consolidated companies
|
|
207.0
|
|
|
123.3
|
|
|
678.4
|
|
|
925.7
|
Equity in net
earnings (loss) of nonconsolidated companies
|
|
(4.1)
|
|
|
2.5
|
|
|
(9.6)
|
|
|
10.0
|
Net earnings
including noncontrolling interests
|
|
202.9
|
|
|
125.8
|
|
|
668.8
|
|
|
935.7
|
Less: Net earnings
attributable to noncontrolling interests
|
|
1.0
|
|
|
1.4
|
|
|
0.9
|
|
|
1.7
|
Net earnings
attributable to Mosaic
|
|
$
|
201.9
|
|
|
$
|
124.4
|
|
|
$
|
667.9
|
|
|
$
|
934.0
|
Diluted net earnings
per share attributable to Mosaic
|
|
$
|
0.54
|
|
|
$
|
0.29
|
|
|
$
|
1.72
|
|
|
$
|
2.19
|
Diluted weighted
average number of shares outstanding
|
|
375.9
|
|
|
427.1
|
|
|
377.0
|
|
|
427.1
|
Condensed
Consolidated Balance Sheets
|
(in millions,
except per share amounts)
|
|
|
|
|
|
The Mosaic
Company
|
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
September 30,
2014
|
|
December 31,
2013
|
Assets
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
2,970.6
|
|
|
$
|
5,293.1
|
Receivables,
net
|
|
573.9
|
|
|
543.1
|
Inventories
|
|
1,471.5
|
|
|
1,432.9
|
Deferred income
taxes
|
|
171.8
|
|
|
129.9
|
Other current
assets
|
|
470.7
|
|
|
706.8
|
Total current
assets
|
|
5,658.5
|
|
|
8,105.8
|
Property, plant and
equipment, net
|
|
9,413.7
|
|
|
8,576.6
|
Investments in
nonconsolidated companies
|
|
840.0
|
|
|
576.4
|
Goodwill
|
|
1,741.3
|
|
|
1,794.4
|
Deferred income
taxes
|
|
187.5
|
|
|
152.2
|
Other
assets
|
|
614.5
|
|
|
348.6
|
Total
assets
|
|
$
|
18,455.5
|
|
|
$
|
19,554.0
|
Liabilities and
Equity
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Short-term
debt
|
|
$
|
0.4
|
|
|
$
|
22.6
|
Current maturities of
long-term debt
|
|
41.0
|
|
|
0.4
|
Accounts
payable
|
|
762.2
|
|
|
570.2
|
Accrued
liabilities
|
|
712.0
|
|
|
666.3
|
Contractual share
repurchase liability
|
|
—
|
|
|
1,985.9
|
Deferred income
taxes
|
|
19.5
|
|
|
20.5
|
Accrued income
taxes
|
|
14.5
|
|
|
—
|
Total current
liabilities
|
|
1,549.6
|
|
|
3,265.9
|
Long-term debt, less
current maturities
|
|
3,774.2
|
|
|
3,008.9
|
Deferred income
taxes
|
|
963.9
|
|
|
1,031.5
|
Other noncurrent
liabilities
|
|
1,205.3
|
|
|
927.1
|
Equity:
|
|
|
|
|
|
Preferred stock,
$0.01 par value, 15,000,000 shares authorized, none issued and
outstanding as of September 30, 2014 and December 31,
2013
|
|
—
|
|
|
—
|
Class A Common Stock,
$0.01 par value, 211,380,055 shares authorized, 34,352,114 shares
issued and outstanding as of September 30, 2014, 254,300,000 shares
authorized, 128,759,772 shares issued and 85,839,827 shares
outstanding as of December 31, 2013
|
|
0.3
|
|
|
1.3
|
Class B Common Stock,
$0.01 par value, 87,008,602 shares authorized, none issued and
outstanding as of September 30, 2014 and December 31,
2013
|
|
—
|
|
|
—
|
Common Stock, $0.01
par value, 1,000,000,000 shares authorized, 352,541,841 shares
issued and 338,783,128 shares outstanding as of September 30, 2014,
352,204,571 shares issued and 340,166,109 shares outstanding as of
December 31, 2013
|
|
3.4
|
|
|
3.0
|
Capital in excess of
par value
|
|
0.5
|
|
|
1.6
|
Retained
earnings
|
|
11,153.2
|
|
|
11,182.1
|
Accumulated other
comprehensive income
|
|
(212.8)
|
|
|
114.3
|
Total Mosaic
stockholders' equity
|
|
10,944.6
|
|
|
11,302.3
|
Noncontrolling
interests
|
|
17.9
|
|
|
18.3
|
Total
equity
|
|
10,962.5
|
|
|
11,320.6
|
Total liabilities and
equity
|
|
$
|
18,455.5
|
|
|
$
|
19,554.0
|
Condensed
Consolidated Statements of Cash Flows
|
(in millions,
except per share amounts)
|
|
|
|
The Mosaic
Company
|
|
(unaudited)
|
|
|
Three months ended
September
30,
|
|
Nine months ended
September 30,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Cash Flows from
Operating Activities:
|
|
|
|
|
|
Net earnings
including noncontrolling interests
|
|
$
|
202.9
|
|
|
$
|
125.8
|
|
|
$
|
668.8
|
|
|
$
|
935.7
|
Adjustments to
reconcile net earnings including noncontrolling interests to net
cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation,
depletion and amortization
|
|
189.5
|
|
|
166.1
|
|
|
558.2
|
|
|
488.8
|
Deferred income
taxes
|
|
(5.4)
|
|
|
—
|
|
|
(97.4)
|
|
|
205.3
|
Equity in net loss of
nonconsolidated companies, net of dividends
|
|
4.1
|
|
|
7.0
|
|
|
11.1
|
|
|
36.3
|
Accretion expense for
asset retirement obligations
|
|
8.6
|
|
|
9.9
|
|
|
29.8
|
|
|
26.6
|
Share-based
compensation expense
|
|
5.7
|
|
|
14.1
|
|
|
49.2
|
|
|
19.7
|
Amortization of
acquired inventory
|
|
4.2
|
|
|
—
|
|
|
39.7
|
|
|
—
|
Change in value of
share repurchase agreement
|
|
(5.3)
|
|
|
—
|
|
|
60.2
|
|
|
—
|
(Gain) loss on assets
sold and to be sold
|
|
(28.9)
|
|
|
122.8
|
|
|
(26.1)
|
|
|
122.8
|
Carlsbad
restructuring expense
|
|
67.0
|
|
|
—
|
|
|
67.0
|
|
|
—
|
Other
|
|
29.9
|
|
|
(43.8)
|
|
|
6.4
|
|
|
13.6
|
Changes in assets and
liabilities, excluding effects of acquisition:
|
|
|
|
|
|
|
|
|
|
|
|
Receivables,
net
|
|
6.1
|
|
|
131.7
|
|
|
(64.0)
|
|
|
191.6
|
Inventories
|
|
74.5
|
|
|
(2.5)
|
|
|
38.3
|
|
|
20.3
|
Other current and
noncurrent assets
|
|
50.3
|
|
|
(167.8)
|
|
|
216.7
|
|
|
(238.6)
|
Accounts
payable
|
|
6.5
|
|
|
(104.1)
|
|
|
272.3
|
|
|
(128.7)
|
Accrued liabilities
and income taxes
|
|
(104.0)
|
|
|
(221.0)
|
|
|
67.8
|
|
|
(65.1)
|
Other noncurrent
liabilities
|
|
(17.1)
|
|
|
(83.2)
|
|
|
13.9
|
|
|
(111.6)
|
Net cash provided by
(used in) operating activities
|
|
488.6
|
|
|
(45.0)
|
|
|
1,911.9
|
|
|
1,516.7
|
Cash Flows from
Investing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
(188.4)
|
|
|
(332.5)
|
|
|
(677.3)
|
|
|
(1,074.0)
|
Proceeds from sale of
business
|
|
55.0
|
|
|
—
|
|
|
55.0
|
|
|
—
|
Acquisition of
business
|
|
(22.2)
|
|
|
—
|
|
|
(1,375.8)
|
|
|
—
|
Investments in
nonconsolidated companies
|
|
(2.4)
|
|
|
(134.5)
|
|
|
(152.0)
|
|
|
(156.3)
|
Other
|
|
(0.1)
|
|
|
1.3
|
|
|
(2.6)
|
|
|
4.7
|
Net cash used in
investing activities
|
|
(158.1)
|
|
|
(465.7)
|
|
|
(2,152.7)
|
|
|
(1,225.6)
|
Cash Flows from
Financing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
Payments of
short-term debt
|
|
(95.5)
|
|
|
(42.9)
|
|
|
(219.4)
|
|
|
(219.0)
|
Proceeds from
issuance of short-term debt
|
|
83.2
|
|
|
57.2
|
|
|
186.0
|
|
|
204.8
|
Payments of long-term
debt
|
|
(0.5)
|
|
|
(0.7)
|
|
|
(1.5)
|
|
|
(1.5)
|
Proceeds from
issuance of long-term debt
|
|
803.1
|
|
|
2.7
|
|
|
807.2
|
|
|
3.4
|
Proceeds from stock
option exercises
|
|
1.0
|
|
|
0.5
|
|
|
2.3
|
|
|
4.3
|
Repurchases of
stock
|
|
(375.0)
|
|
|
—
|
|
|
(2,507.7)
|
|
|
—
|
Cash dividends
paid
|
|
(93.8)
|
|
|
(106.8)
|
|
|
(288.6)
|
|
|
(320.0)
|
Other
|
|
0.8
|
|
|
0.5
|
|
|
0.2
|
|
|
1.4
|
Net
cash provided by (used in) financing
activities
|
|
323.3
|
|
|
(89.5)
|
|
|
(2,021.5)
|
|
|
(326.6)
|
Effect of exchange
rate changes on cash
|
|
(50.2)
|
|
|
23.3
|
|
|
(60.2)
|
|
|
(31.2)
|
Net change in cash
and cash equivalents
|
|
603.6
|
|
|
(576.9)
|
|
|
(2,322.5)
|
|
|
(66.7)
|
Cash and cash
equivalents - beginning of period
|
|
2,367.0
|
|
|
3,915.5
|
|
|
5,293.1
|
|
|
3,405.3
|
Cash and cash
equivalents - end of period
|
|
$
|
2,970.6
|
|
|
$
|
3,338.6
|
|
|
$
|
2,970.6
|
|
|
$
|
3,338.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Potash Gross Margin, Excluding Resource Taxes and Royalties,
Calculation
|
|
Three months ended
September 30,
|
|
Nine months ended
September 30,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Sales
|
|
$
|
593.0
|
|
|
$
|
523.2
|
|
|
$
|
2,088.5
|
|
|
$
|
2,321.7
|
|
Gross
margin
|
|
131.3
|
|
|
184.4
|
|
|
593.9
|
|
|
970.3
|
|
Canadian resource
taxes
|
|
45.6
|
|
|
30.8
|
|
|
120.7
|
|
|
129.9
|
|
Canadian
royalties
|
|
5.5
|
|
|
10.5
|
|
|
18.6
|
|
|
39.2
|
|
Gross margin,
excluding Canadian resource taxes and royalties (CRT)
|
|
$
|
182.4
|
|
|
$
|
225.7
|
|
|
$
|
733.2
|
|
|
$
|
1,139.4
|
|
Gross margin
percentage, excluding CRT
|
|
30.8%
|
|
|
43.1%
|
|
|
35.1%
|
|
|
49.1%
|
|
The Company has presented above gross margin excluding Canadian
resource taxes and royalties ("CRT") for Potash which
is a non-GAAP financial measure. Generally, a non-GAAP
financial measure is a supplemental numerical measure of a
company's performance, financial position or cash flows that either
excludes or includes amounts that are not normally excluded or
included in the most directly comparable measure calculated and
presented in accordance with U.S. generally accepted accounting
principles ("GAAP"). Gross margin excluding CRT is not a measure of
financial performance under GAAP. Because not all companies use
identical calculations, investors should consider that Mosaic's
calculation may not be comparable to other similarly titled
measures presented by other companies.
Gross margin excluding CRT provides a measure that the Company
believes enhances the reader's ability to compare the Company's
gross margin with that of other companies which incur CRT expense
and classify it in a manner different than the Company in their
statement of earnings. Because securities analysts, investors,
lenders and others use gross margin excluding CRT, the Company's
management believes that Mosaic's presentation of gross margin
excluding CRT for Potash affords them greater transparency in
assessing Mosaic's financial performance against competitors. Gross
margin excluding CRT, should not be considered as a substitute for,
or superior to, measures of financial performance prepared in
accordance with GAAP.
Earnings Per Share Calculation
|
|
Three months ended
September 30,
|
|
Nine months ended
September 30,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Net earnings
attributed to Mosaic
|
|
$
|
201.9
|
|
|
$
|
124.4
|
|
|
$
|
667.9
|
|
|
$
|
934.0
|
|
Undistributed
earnings attributable to participating securities
|
|
(0.5)
|
|
|
—
|
|
|
(19.2)
|
|
|
—
|
|
Numerator for basic
and diluted earnings available to common stockholders
|
|
$
|
201.4
|
|
|
$
|
124.4
|
|
|
$
|
648.7
|
|
|
$
|
934.0
|
|
Basic weighted
average number of shares outstanding
|
|
375.0
|
|
|
425.9
|
|
|
386.6
|
|
|
425.8
|
|
Shares subject to
forward contract
|
|
(1.0)
|
|
|
—
|
|
|
(11.1)
|
|
|
—
|
|
Basic weighted
average number of shares outstanding attributable to common
stockholders
|
|
374.0
|
|
|
425.9
|
|
|
375.5
|
|
|
425.8
|
|
Dilutive impact of
share-based awards
|
|
1.9
|
|
|
1.2
|
|
|
1.5
|
|
|
1.3
|
|
Diluted weighted
average number of shares outstanding
|
|
375.9
|
|
|
427.1
|
|
|
377.0
|
|
|
427.1
|
|
Basic net earnings
per share
|
|
$
|
0.54
|
|
|
$
|
0.29
|
|
|
$
|
1.73
|
|
|
$
|
2.19
|
|
Diluted net earnings
per share
|
|
$
|
0.54
|
|
|
$
|
0.29
|
|
|
$
|
1.72
|
|
|
$
|
2.19
|
|
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SOURCE The Mosaic Company