Mosaic Company (the) · NYSE:MOS
Mosaic Company (the) — Q4 FY2013 Earnings Presentation
20 slides from Mosaic Company (the)'s earnings presentation, Jul 19, 2013
Slide 1: The Mosaic Company Earnings Conference Call – 4th Quarter and Fiscal 2013
The Mosaic Company Earnings Conference Call – 4 th Quarter and Fiscal 2013 July 16, 2013 Jim Prokopanko, President and Chief Executive Officer Larry Stranghoener, Executive Vice President and Chief Financial Officer Laura Gagnon, Vice President Investor Relations Exhibit 99.2
Slide 2: Safe Harbor Statement
Safe Harbor Statement Safe Harbor Statement This press release 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
Slide 3: Fourth Quarter Financial Highlights
Fourth Quarter Financial Highlights $445 $198 0 0 $1,670 $1,031 0 $2.7 billion $621 million $1.14 Diluted EPS Another great quarter given external challenges. Operating Earnings Net Sales Phosphates Potash
Slide 4: Fourth Quarter Overview
Fourth Quarter Overview Challenges Results Wet and late spring Mississippi river levels Cautious distributor behavior Unbalanced Indian nutrient subsidy Great execution on all fronts: Record potash shipments PhosChem India agreement Record March-May Canpotex shipments Good asset utilization
Slide 5: Lackluster Prices: Root Causes and Expectations
Lackluster Prices Root Causes Expectations Resolution of the Indian subsidy imbalance Volumes increase before prices Demand growth to absorb new supply Indian Subsidy Imbalance New P supply: China & Saudi Arabia New K supply: Russia & Canada
Slide 6: Crop Nutrient Affordability Near Record Levels
Crop Nutrient Affordability Near Record Levels Considerations • Revenue per acre matters! • Strong farm income even with lower commodity prices • Near record crop nutrient affordability Corn: Revenue per Acre $900 = 200 bpa x $4.50 = 150 bpa x $6.00 > 120 bpa x $7.25 0.50 0.75 1.00 1.25 1.50 1.75 Pl
Slide 7: Commodity Prices Likely to Remain Elevated
Commodity Prices Likely to Remain Elevated Considerations • Pent up demand with 2012/13 US Corn exports down 54% year-to-date • The likely case builds back one-half of the inventory drawdown this year • Agricultural commodity prices likely to remain elevated in 2013/14
Slide 8: 2013 – A Year of Success! Accomplishments
2013 – A Year of Success! Accomplishments New safety record Potash expansions on track on budget Benefits of tolling agreement reversion Northern Promise JV (Saudi Arabia) Continued MicroEssentials® momentum South Fort Meade productivity AEIS – a stepping stone to new permits Strategic review comple
Slide 9: Financial Results Review
Financial Results Review
Slide 10: Balance Sheet Update: Class A Shares and Debt Offering
Balance Sheet Update Class A Shares Debt Offering Cargill, Incorporated declined to amend agreements A delay. Committed to stated: Balance sheet targets Mid 2014 timeframe Can continue dialogue Can’t execute until after November th Expect debt issuance in the second half of 2013 Historically attract
Slide 11: Category Guidance – Calendar Q3 2013 Financial Guidance Summary
Category Guidance – Calendar Q3 2013 Financial Guidance Summary Potash Q3 Sales volume 1.8 – 2.1 million tonnes Q3 MOP selling price $330 - per tonne Q3 Gross margin rate in the mid to high 30 percent range Q3 Operating rate below 75 percent Turnaround days Curtailing production at the Colonsay mine
Slide 12: Category Guidance – Calendar Q3 2013 Financial Guidance Summary
Category Guidance – Calendar Q3 2013 Financial Guidance Summary Phosphates Q3 Sales volume 2.9 – 3.3 million tonnes Q3 DAP selling price $430 - $465 per tonne Q3 Operating rate in the mid 80 percent range Q3 Gross margin rate to be flat with last quarter Corporate Total SG&A – Q3CY13 $95 - 105 milli
Slide 13: Outlook
Outlook
Slide 14: Our Strategic Priorities
Our Strategic Priorities People Growth Market Access Innovation Total Shareholder Return
Slide 15: Mosaic
Mosaic
Slide 16: Mosaic Financial Performance
In millions, except per share amounts Three Months Ended May 31, 2013 May 31, 2012 Mosaic Financial Performance Net Sales $2,692.2 $2,820.5 Gross Margin $768.6 $833.8 % of net sales 28.5% 29.6% Net Earnings Attributable to Mosaic $485.9 $507.3 % of net sales 18.0% 18.0% Diluted EPS $1.14 $1.19 Effec
Slide 17: Potash Segment Highlights
Potash Segment Highlights In millions, except MOP price Q4 FY13 Q3 FY13 Q4 FY12 Net sales $1,031 $758 $1,037 Gross Margin $489 $308 $514 Percent of net sales 47% 41% 50% Operating earnings $445 $216 $464 Sales volumes 2.6 1.8 2.0 Production volume 2.5 2.0 1.9 Production operating rate 95% 78% 85% Av
Slide 18: Phosphates Segment Highlights
Phosphates Segment Highlights In millions, except DAP price Q4 FY13 Q3 FY13 Q4 FY12 Net sales $1,670 $1,502 $1,789 Gross Margin $290 $266 $322 Percent of net sales 17% 18% 18% Operating earnings $198 $197 $224 Sales volumes 2.9 2.6 2.9 NA production volume (a) 2.1 2.1 2.1 Finished product operating
Slide 19: Raw Material Cost Detail
Raw Material Cost Detail Q4 FY13 Percent Mosaic is currently implementing a new inventory valuation system. After implementation, Mosaic expects to include this information in its performance data disclosures. Ammonia ($/MT) Realized in COGS $540 Average Purchase Price $601 Sulfur ($/LT) Realized in
Slide 20: Earnings Sensitivity to Key Drivers
Earnings Sensitivity to Key Drivers (a) FY13 Q4 Actual Change FY13 Q4 Margin % Actual % Impact on Segment Margin Pre-Tax Impact EPS Impact Marketing MOP Price ($/tonne) (b) $368 $50 47.3% 11.5% $119 $0.21 Potash Volume (million tonnes) 2.6 0.5 47.3% 11.9% $122 $0.22 DAP Price ($/tonne) $483 $50 17.4