Mosaic Company (the) · NYSE:MOS
Mosaic Company (the) — The Mosaic Company — Q3 2021 Earnings Presentation
18 slides from Mosaic Company (the)'s earnings presentation, Nov 2, 2021
Slide 1: Third Quarter 2021 Earnings Commentary
THIRD QUARTER 2021 EARNINGS COMMENTARY November 1, 2021 Management of The Mosaic Company provided the following commentary to accompany its third quarter 2021 earnings news release and performance data: The third quarter of 2021 delivered the highest quarterly adjusted EBITDA in more than a decade,
Slide 2: Our results are generating strong cash flow, which we’ve begun to allocate
Nutrient prices continue to rise, and based on our current book of sales, we expect the fourth quarter results to show continued positive momentum across our business. Mosaic Fertilizantes continues to outperform our initial expectations, delivering $290 million in operating earnings and more than $
Slide 3: Global agriculture market fundamentals remain attractive
Global agriculture market fundamentals remain attractive. With oil prices above $80 per barrel, increased demand for biofuels and renewable diesel are expected to push grain and oilseed demand higher. China continues to be a large contributor to global demand for grain and oilseeds, buying record am
Slide 4: Farmer economics supportive of nutrient application
With the fundamentals underpinning crop prices continuing into 2022, we expect farmer economics to remain supportive of nutrient application. Growers have seen all costs rise over the past year, so we continue to watch affordability issues and work closely with our customers to ensure strong relatio
Slide 5: Phosphate market
Strong global demand for fertilizers combined with supply disruptions and low inventories have continued to push nutrient prices higher. As a result of these trends, Mosaic expects to realize sequential price increases in the fourth quarter. PHOSPHATES The phosphate market remained tight, as buyers’
Slide 6: Potash market
POTASH The global potash market remained tight as global demand and low inventories more than offset new supply announcements. Our expectations for global shipments in 2021 are up 1.2 million tonnes over 2020. Inventories around the world remain below historical norms, especially in India and China,
Slide 7: Product portfolio initiatives
Our product portfolio initiatives reflect our determination to support soil health while providing value for our growers. Our partnerships with Anuvia, BioConsortia, Sound Agriculture, and AgBiome provide us with opportunities to supply farmers with products across a wide range of applications from
Slide 8: Liquidity and capital allocation
At the end of the quarter, Mosaic had over $3.8 billion in liquidity, including $843 million in cash, $2.5 billion of committed lines of credit, and $500 million of other available lines. We remain committed to a balanced capital allocation program that focuses on balance sheet strength, capital ret
Slide 9: Mosaic Fertilizantes results
$1.3 billion. We are evaluating further opportunities to add value through deployment of capital as we continue to generate excess free cash flow from strong markets and cost savings. Mosaic Fertilizantes delivered $290 million in operating earnings and $317 million in adjusted EBITDA in the third q
Slide 10: Phosphate segment results
over-year basis, the Brazilian Real strengthened about 2%, but over time we expect the inverse relationship between inflation and exchange rates to be maintained and provide an offset. Mining and conversion costs, which had been impacted by lower volumes during the first half of 2021, improved but s
Slide 11: Phosphate fourth quarter outlook
at the beginning of the quarter. Sales volumes in 4Q are expected to be 1.8 to1.9 million tonnes. The combined financial impact from these events during the quarter was $75 million, of which only $18 million was considered notable. The bulk of this was related to lost margin on disrupted capacity, b
Slide 12: Potash segment results
The Potash Segment generated operating earnings of $220 million in the third quarter of 2021, compared to $87 million in the year ago period as pricing more than offset costs associated with the closure of K1 and K2 and the restart of Colonsay. During the quarter, the segment delivered $272 million
Slide 13: Fourth quarter outlook
begun hauling ore. In the fourth quarter, we expect sales to return to historical levels of 2.0 to 2.1 million tonnes. We expect to continue realizing the benefits of market price improvements, particularly in phosphate, where 90 percent of our fourth quarter volumes are committed and priced. We exp
Slide 14: Transformed and optimized business generating earnings leverage
Mosaic has transformed and optimized its business, and these efforts are generating significant earnings leverage. We have shown an ability to meet customer demand and generate shareholder value by driving down production costs under our control, flexing our portfolio of assets to mitigate the impac
Slide 15: Reconciliation of non GAAP measures
Reconciliation of non GAAP measures Consolidated Earnings (Loss' ions) Q3 2021 Q3 2020 Consolidated net earnings (loss) attributable to Mosaic $372 $(6) Less: Consolidated interest expense, net (48) (43) Plus: Consolidated depreciation, depletion and amortization 186 206 Plus: Accretion expense 17 1
Slide 16: Reconciliation of non GAAP measures
Reconciliation of non GAAP measures Mosaic Fertilizantes Earnings (in millions) Q3 2021 Operating earnings $290 Plus: Depreciation, depletion and amortization 26 Plus: Accretion expense Ss Plus: Foreign exchange gain (loss) (40) Plus: Other income (expense) (2) Less: Earnings (loss) from consolidate
Slide 17: Reconciliation of non GAAP measures
Mosaic Reconciliation of non GAAP measures Phosphates Earnings (in millions) Q3 2021 Q3 2020 Operating earnings (loss) $326 $(115) Plus: Depreciation, depletion and amortization 106 108 Plus: Accretion expense 13 12 Plus: Foreign exchange gain (loss) 6 1 Plus: Other income (expense) 1 Less: Earnings
Slide 18: Forward Looking Statements & Non-GAAP Financial Measures
Forward Looking Statements & Non-GAAP Financial Measures POCO CeCe eee eee HSE E HEHEHE EEE TEESE SESESEEEESETE SEES ESE SESEEEESESESEES ‘Ths presentation contains forward ooking statements win the meaning of the Prvate Secunies Ligation Reform Act of $905. Such statements may include, But are not l