Mosaic Company (the) · NYSE:MOS
Mosaic Company (the) — Q1 FY2011 Earnings Presentation
17 slides from Mosaic Company (the)'s earnings presentation, Oct 12, 2010
Slide 1: Earnings Conference Call - 1st Quarter Fiscal 2011
The Mosaic Company Jim Prokopanko, President and Chief Executive Officer Larry Stranghoener, Executive VP and Chief Financial Officer Mike Rahm, Vice President Market and Strategic Analysis Christine Battist, Director - Investor Relations Earnings Conference Call - 1 st Quarter Fiscal 2011 Tuesday,
Slide 2: Safe Harbor Statement
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 future financial and operating results. Such statements are based upon the current beliefs and expectati
Slide 3: Leader in Potash and Phosphate
Leader in Potash and Phosphate SOURCE: IFA, COMPANY REPORTS AND MOSAIC ESTIMATE
Slide 4: Financial Results
In millions, except per share amounts Three Months Ended August 31, 2010 2009 Net Sales $2,188.3 $1,457.2 Gross Margin $504.7 $222.2 % of net sales 23% 15% Net Earnings $297.7 $100.6 % of net sales 14% 7% Diluted EPS $0.67 $0.23 Effective Tax Rate 27% 25% Cash Flow Provided by Operations $556.2 $172
Slide 5: Phosphates Segment Highlights
Phosphates Segment Highlights Q1 FY11 Q4 FY10 Q1 FY10 IN MILLIONS, EXCEPT DAP PRICE Net sales $1,581.1 $1,187.9 $1,194.5 Gross Margin $245.0 $306.6 $114.5 % of net sales 15% 26% 10% Operating earnings $178.0 $221.1 $46.5 Sales volumes 3.1 2.3 2.9 NA production volume 2.2 1.9 2.0 Ave DAP selling pric
Slide 6: Potash Segment Highlights
Potash Segment Highlights Q1 FY11 Q4 FY10 Q1 FY10 IN MILLIONS, EXCEPT MOP PRICE Net sales $621.9 $696.5 $333.3 Gross Margin $256.7 $378.1 $124.6 % of net sales 41% 54% 37% Operating earnings $218.0 $346.9 $99.3 Sales volumes 1.7 1.8 0.8 Production volume 1.4 1.9 0.8 Ave MOP selling price $331 $336 $
Slide 7: Execution of Strategic Priorities
Execution of Strategic Priorities • Investment in Miski Mayo • Closed Fosfertil sale • Grow value in Phosphates – Align distribution with production – Optimize production rates – Grow MicroEssentials® • Potash expansions continue on plan – New shaft at Esterhazy
Slide 8: Category Guidance
Category Guidance Phosphates Market Phosphates Segment Extremely tight near term Large domestic and international shipments U.S. producer inventories extremely low Q2 Sales volume 3.3 – 3.6 million tonnes Q2 DAP selling price $430 - $460 per tonne Operating rate of 85 – 90% Potash Market Potash Segm
Slide 9: South Fort Meade Update
South Fort Meade Update Litigation status: • Awaiting decision from federal district court and Eleventh Circuit on requested motions for partial stay • Granted an expedited appeal of the preliminary injunction by the Eleventh Circuit Factors mitigating operational impact: • Utilizing phosphate rock
Slide 10: Market Outlook
Market Outlook
Slide 11: Developments in Ag Commodity Markets
Developments in Ag Commodity Markets Highlights: • Severe weather events: Russia, Saskatchewan, Europe, Pakistan, China, Western Australia • U.S corn crop conditions • Other crop prices rally: cocoa, coffee, cotton, palm oil, and sugar
Slide 12: Healthy Farm Economics
Healthy Farm Economics • Nutrient cost well within historic norms • Record net farm income in U.S. • Farm profitability at or near records in key markets around the world IOWA HIGH YIELD FARM SOURCE: IOWA STATE UNIVERSITY, USDA AND MOSAIC
Slide 13: Phosphate Demand at Record Levels
Phosphate Demand at Record Levels Import demand in growth regions (million tonnes): Brazil: • 2009 2.1 • 2010F 2.5 • 2011F 2.7 – 2.9 India: • 2009 6.6 • 2010F 8.0 • 2011F 7.5 – 8.0
Slide 14: Rebounding Potash Demand
Rebounding Potash Demand Import demand in growth regions (million tonnes): Brazil: • 2009 3.4 • 2010F 5.9 • 2011F 6.2 – 6.5 China: • 2009 1.6 • 2010F 5.0 • 2011F 6.0 – 8.0 India • 2009 6.0 • 2010F 6.0 • 2011F 6.3 – 6.5
Slide 15: Supply Issues
Supply Issues • Phosphate: – How much will Ma’aden produce in 2011? – Loss of Agrifos production – Raw material availability – Chinese exports – South Fort Meade resolution • Potash – Brownfield expansions required to keep up with demand
Slide 16: Key Points
Key Points • Strong quarterly results • Balanced nutrient portfolio paying off • Positive market outlook • Executing our strategic priorities
Slide 17: The Mosaic Company
The Mosaic Company