Mosaic Company (the) · NYSE:MOS
Mosaic Company (the) — The Mosaic Company — Q4 2021 Earnings Presentation
24 slides from Mosaic Company (the)'s earnings presentation, Feb 23, 2022
Slide 1: The Mosaic Company 2021 Results
The Mosaic Company 2021 Results Date: February 22, 2022
Slide 2: Forward Looking Statements & Non-GAAP Financial Measures
Forward Looking Statements & Non-GAAP Financial Measures This presentation 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 proposed or pending future transactions or stra
Slide 3: 2021 Performance
2021 Performance CONSOLIDATED OPERATING NET ADJUSTED(1) REVENUES EARNINGS EARNINGS EBITDA $12.4B $2.5B $1.6B $3.6B +42% Y/Y +498% Y/Y +145% Y/Y +129% Y/Y PHOSPHATES POTASH MOSAIC FERTILIZANTES Net Operating Adjusted Net Operating Adjusted Net Operating Adjusted Revenues Earnings EBITDA(1) Revenues E
Slide 4: Segment Highlights
Segment Highlights • Accelerated completion of K3’s second shaft in the fourth quarter; Production ramp completed by the end of 1Q22 Potash • Successfully restarted operations at Colonsay; 4Q cash production costs of $85/tonne • Exceeded $200 million target for EBITDA(1) contribution from Mosaic tra
Slide 5: Solid Agricultural Fundamentals
Solid Agricultural Fundamentals Stock-to-use ratio is at the lowest point since 2003/04 and unlikely to recover in a single season World (Less China) Grain and Oilseed Stocks 475 23% 450 22% 425 21% 400 20% 375 19% Percent of Use Stocks, MMT 350 18% 325 17% 300 16% 275 15% 250 14% 225 13% 200 12% 20
Slide 6: Nearly All Agriculture Prices Elevated
Nearly All Agriculture Prices Elevated Strong demand has driven nearly all agricultural commodity prices higher over the last two years Indexed Daily Close of Front Month Contract Indexed Daily Close of Front Month Contract 275 275 Corn Soy Wheat Palm Oil Coffee Rice Sugar Cotton 250 250 225 225 200
Slide 7: Ag Prices Drive Nutrient Demand
Ag Prices Drive Nutrient Demand… Current ag commodity prices support nutrient application, which should drive 2022 P & K shipments Global Phosphate Shipments Global MOP Shipments DAP/MAP/NPS/TSP 80 75 75 70 Mil Tonnes, KCl Mil Tonnes 70 65 65 60 60 55 55 50 50 45 10 11 12 13 14 15 16 17 18 19 20 21E
Slide 8: As P & K Supply Constrained
…As P & K Supply Constrained Fertilizer prices reflect the impact of strong demand and constrained phosphate and potash supply Global DAP/MAP Benchmark Prices Potash Prices Published Spot Prices Published Spot Prices 1,000 DAP, NOLA DAP, India 900 Brazil (c&f) 900 SE Asia (c&f) MAP, NOLA MAP, Brazil
Slide 9: 2022 Capital Allocation
2022 Capital Allocation Free Cash Flow(1) Return to Strengthen Balance Invest in the Business Shareholders Sheet Majority of 2022 Reduce Long-term High-returning, Free Cash Flow Debt by $1 Billion Quick Paybacks (up to 75%) Over Time • K3 ramp up • $400 million accelerated share repurchase (ASR) • $
Slide 10: New Product Pipeline
New Product Pipeline Spent $50 million to build a foundation for value-added grower solutions Next generation patented formulation that improves sulfur utilization Nitrogen fixing bacteria with the potential to disrupt the global nitrogen market; Exclusive rights in the Americas, China, India Phosph
Slide 11: Diversity and Inclusion (D&I)
Diversity and Inclusion (D&I) By 2030, Mosaic has committed to: 30% Women in the workplace 30% Growth in underrepresented groups in the workplace 30% Growth in leadership diversity 30% Community investments focused on D&I initiatives We believe when teams include people with different perspectives,
Slide 12: Appendix
Appendix
Slide 13: Consolidated Results Y/Y
Consolidated Results Y/Y Consolidated Net Sales rose 42% primarily driven by price increases, which, when combined with transformational savings drove significantly improved year-over-year profitability. Operating Earnings increased 498%, Net Earnings increased significantly, and Adjusted EBITDA mor
Slide 14: Balance Sheet Strength & Liquidity
Balance Sheet Strength & Liquidity Mosaic targets investment grade metrics and currently has ~$3.5 billion in available liquidity LIQUIDITY DEBT COVENANTS ~$770 million cash on the balance sheet EBITDA / Interest of > 3.0x, 4Q 2021 at 14.7x ~$2.5 billion committed line of credit available Debt / Tot
Slide 15: Outlook for 2022
Outlook for 2022 Pricing & Sensitivities FY 2021 4Q 2021 Sensitivity Average DAP fob plant ($/tonne)(1) $564 $676 $10 price = $94 mm adjusted EBITDA Average MOP fob mine ($/tonne)(2) $285 $414 $10 price = $53 mm adjusted EBITDA BRL/USD(3) 5.39 5.58 Unhedged: $0.10 = $10 mm adjusted EBITDA (1) Approx
Slide 16: Potash 2021 Performance
Potash 2021 Performance Y/Y Adjusted EBITDA(1) Bridge 2021 2020 Variance $564 Sales Volumes (mt in millions) 8.186 9.396 (1.210) $40 $(105) $839 $(95) MOP Selling Price (FOB Mine) ($/mt) $ 285 $ 181 $ 104 $(45) $(29) $(41) $1,286 MOP cash costs of production (excl Brine) ($/mt) $ 67 $ 56 $ 11 Brine
Slide 17: Phosphate 2021 Performance
Phosphate 2021 Performance Y/Y Adjusted EBITDA(1) Bridge 2021 2020 Variance Sales Volumes (mt in millions) 7.693 8.534 (0.841) DAP Selling Price (FOB Plant) ($/mt) $ 564 $ 310 $ 254 $1,193 $1,819 $(430) Production volume (mt in millions) 7.331 8.160 (0.829) FL Cash Rock Cost of production ($/mt) $ 4
Slide 18: Mosaic Fertilizantes 2021 Performance
Mosaic Fertilizantes 2021 Performance Y/Y Adjusted EBITDA(1) Bridge 2021 2020 Variance $348 Sales Volumes (mt in millions) 10.102 10.564 (0.462) Average Finished Product Selling Price ($/mt) $ 504 $ 330 $ 174 $74 $(96) $269 $(70) MAP Price (delivered price to third party) ($/mt) $ 597 $ 333 $ 264 $(
Slide 19: Reconciliation of non GAAP measures
Reconciliation of non GAAP measures Consolidated Earnings (in millions) 2021 2020 Consolidated net earnings attributable to Mosaic $1,631 $666 Less: Consolidated interest expense, net (169) (180) Plus: Consolidated depreciation, depletion and amortization 813 846 Plus: Accretion expense 72 66 Plus:
Slide 20: Reconciliation of non GAAP measures
Reconciliation of non GAAP measures Consolidated Operating Earnings (in millions) 2021 2020 Operating Earnings $2,469 $413 Notable items impact 258 321 Adjusted Operating Earnings $2,727 $734 20
Slide 21: Reconciliation of non GAAP measures
Reconciliation of non GAAP measures Potash Earnings (in millions) 2021 2020 Operating earnings $837 $402 Plus: Depreciation, depletion and amortization 268 280 Plus: Accretion expense 10 8 Plus: Foreign exchange gain (loss) 8 27 Plus: Other income (expense) - 4 Plus: Notable items 163 1 Adjusted EBI
Slide 22: Reconciliation of non GAAP measures
Reconciliation of non GAAP measures Phosphates Earnings (in millions) 2021 2020 Operating earnings (loss) $1,180 $(147) Plus: Depreciation, depletion and amortization 429 442 Plus: Accretion expense 48 48 Plus: Foreign exchange gain (loss) 9 16 Plus: Other income (expense) 8 11 Less: Earnings (loss)
Slide 23: Reconciliation of non GAAP measures
Reconciliation of non GAAP measures Mosaic Fertilizantes Earnings (in millions) 2021 2020 Operating earnings $745 $347 Plus: Depreciation, depletion and amortization 101 105 Plus: Accretion expense 14 12 Plus: Foreign exchange gain (loss) (70) (102) Plus: Other income (expense) (6) (5) Less: Earning
Slide 24: Operating Driver Targets
Operating Driver Targets 12/31/21 2023 Target Phosphates Cash cost of U.S. mined rock ($/tonne)(1) $40 $34 Cash costs of conversion ($/tonne) (1) $68 $51 Cash costs of production (excluding brine) – MOP ($/tonne) (1) $67 $49 Potash Cash brine management costs ($ in millions) $28 $0 Fertilizantes Cas