Mosaic Company (the) · NYSE:MOS
Mosaic Company (the) — The Mosaic Company — BMO Capital Markets 24th Global Metals & Mining Conference 2015
23 slides from Mosaic Company (the)'s conference presentation, February 2015
Slide 1: The Mosaic Company
The Mosaic Company Jim Prokopanko, President and Chief Executive Officer February, 2015
Slide 2: Safe Harbor Statement
Safe Harbor Statement Click to edit Master title style 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 Wa’ad Al Shamal Phosphate Company (also known as
Slide 3: Investment Thesis
Investment Thesis Click to edit Master title style • In this cyclical industry, the positive secular trends continue. • Long-term value creation is predicated on effective capital deployment. • Capital deployment near the trough of the cycle maximizes value creation: – Depressed investment values –
Slide 4: Why Now?
Why Now?
Slide 5: Near-term Grain and Oilseed Stocks
Near-term Grain and Oilseed Stocks Million Tonnes World Grain & Oilseed Stocks Stocks to Use 700 29% Source: USDA and Mosaic 650 623 27% 607 600 580 585 25% 570 551 550 540 23% 514 524 495 500 21% 470 463 450 438 19% 426 408 400 17% 350 15% 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14E 15F USDA Mosa
Slide 6: Crop Nutrient Affordability Index
Crop Nutrient Affordability Index Plant Nutrient Affordability Plant Nutrient Price Index / Crop Price Index 1.75 More Affordable 1.50 1.25 1.00 0.75 0.50 05 06 07 08 09 10 11 12 13 14 15 Source: Weekly Price Publications, Affordability Metric Average CME, USDA, AAPFCO, Mosaic 6
Slide 7: Global Phosphate Shipments Outlook
Global Phosphate Shipments Outlook MMT Product Global Phosphate Shipments DAP/ MAP/ MES/ TSP 70 Source: CRU and Mosaic 64.5-66.5 65 60 55 50 45 40 35 30 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 E15 F 7
Slide 8: Global Potash Shipments Outlook
Global Potash Shipments Outlook Mil Tonnes KCl Global Potash Shipments 65 Source: CRU and Mosaic 58-60 60 55 50 45 40 35 30 25 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 E15 F 8
Slide 9: Why Mosaic?
Why Mosaic?
Slide 10: Phosphates: Scale and Strong Cost Position
Phosphates: Scale and Strong Cost Position Top 10 Phosphate Producers in 2013 OCP US$/Tonne 2014 DAP Industry Cost Curve fob Port 600 Mosaic Source: CRU and Mosaic 550 PotashCorp 500 PhosAgro 450 Yuntianhua 400 Vale 350 Guizhou Kailin Group Finished Phosphate Production 300 GCT Phophoric Acid Sales
Slide 11: Potash: Scale and Improving Cost Position
Potash: Scale and Improving Cost Position Top 10 Potash Producers in 2013 US$/Tonne 2014 MOP Industry Cost Curve fob Port 300 Uralkali Source: CRU and Mosaic 275 Mosaic 250 PotashCorp 225 Belaruskali 200 K+ S 175 Israel Chemical 150 Qinghai Salt Lake Brine costs 125 Agrium 100 APC 75 Vale 50 0.0 2.0
Slide 12: Consistent Strategy; Consistent Execution
Consistent Strategy; Click to Consistent edit Master Execution title style + = 12
Slide 13: Pulling The Right Levers: Volume x Margin = Value
Pulling The Right Levers Volume x Margin = Value Grow through: Grow by optimizing: • Brownfield Potash Expansions • Operations • MicroEssentials® • Production Mix Expansion • Strategic investments: • Product Mix • CF Phosphates • Ma’aden • ADM 13
Slide 14: Phosphates: Investing for Growth
Phosphates: Investing for Growth Million $ Phosphate Gross Margin Impact $1,600 $1,500 $85 $1,400 $165 $1,300 $60 $1,200 $200 $1,568 $1,100 $1,000 $145 $900 $913 $800 2013 Gross Ma'aden CF Phosphate ADM distribution Raw materials MicroEssentials 2018 Gross Margin business business (CF NH3, growth Ma
Slide 15: Potash: Investing for Growth
Potash: Investing for Growth Million $ Potash Gross Margin Impact $1,800 $1,600 $1,400 $115 $295 $1,200 $65 $1,000 $800 $1,579 $600 $1,104 $400 $200 $0 2013 Gross Margin Cost Savings Optimization of assets Growing volumes 2018 Gross Margin Forecast Source: Mosaic * Assumptions in the appendix. Subje
Slide 16: Sum of the Parts
Sum of the Parts Million $ Gross Margin Impact $3,400 $3,200 $20 $3,000 $475 $2,800 $2,600 $3,167 $2,400 $655 $2,200 $2,000 $2,017 $1,800 2013 Gross Margin Phosphates Initiatives Potash Initiatives Corporate Cost Savings 2018 Gross Margin Source: Mosaic Forecast * Assumptions in the appendix. Subjec
Slide 17: Balance Sheet and Capital Update
Balance Sheet and Capital Update $3.5 Transformed Balance $3.0 Sheet: $2.5 Returned $3.2B in 2014 In Billions $2.0 $47 per ~$190 million remaining Share $2.8 under current share $1.5 repurchase authorization $1.0 as of February 6, 2015 $0.5 Committed to maintaining $0.4 targets $0.0 2008 2009
Slide 18: Future Gross Margin per Share: Volume and Rate
Future Gross Margin per Share: Volume and Rate $10 Gross Margin per Share +91% $1.5 $9 $8 $1.1 $7 $1.7 $6 $9.0 $5 $4 $3 $4.7 $2 $1 $0 2013 Phosphates Potash Share Repurchase 2018 Forecast / Corporate * Source: Mosaic 91% upside excluding any cyclical improvement 18 • Assumptions in the appendix. Bas
Slide 19: Unchanged Cash Use Priorities
Unchanged Cash Use Priorities Maintain ratings & financial strength Sustain assets and recurring dividend Investments to drive organic growth Opportunistic strategic investments Return excess cash to shareholders 19
Slide 20: The Mosaic Company Analyst Day 2015
The Mosaic Company Analyst Day 2015 – March 30 - 31 20
Slide 21: Appendix: Assumptions
Appendix: Assumptions Phosphates: Ma’aden JV contribution embedded in gross margin, actual reporting is as an equity investment under U.S. GAAP. ADM business includes an incremental, 2 million tonnes of blended product plus synergies. Raw material savings based on increased NH3 manufacturing b
Slide 22: Global Phosphate Shipment Forecasts by Region
Global Phosphate Shipment Forecasts by Region (February 2015) Oct Oct Feb Feb Source: CRU and Mosaic. Million Tonnes Low High Low High Numbers may not sum to total due to rounding. DAP/MAP/TSP 2013R 2014E 2015F 2015F 2015F 2015F Comments Large but flat shipments in 2014. Forecast for 2015 China 21.5
Slide 23: Global Potash Shipment Forecasts by Region
Global Potash Shipment Forecasts by Region (February, 2015) Oct Oct Feb Feb Source: CRU and Mosaic. Numbers may not sum to total due to rounding. Muriate of Potash Low High Low High Million Tonnes (KCl) 2013R 2014E 2015F 2015F 2015F 2015F Comments Shipments surged 2.8 mmt last year (+1.0 mmt product
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