Mosaic Company (the) · NYSE:MOS
Mosaic Company (the) — Investor Presentation (September 2016)
21 slides from Mosaic Company (the)'s investor presentation, Sep 1, 2016
Slide 1: The Mosaic Company Third Quarter 2016
The Mosaic Company Third Quarter 2016
Slide 2: Forward-looking statements
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 MWSPC) and other proposed or pending future transaction
Slide 3: Agriculture: Declining Farm Income
Agriculture: Declining Farm Income Source: USDA 3 0 20 40 60 80 100 120 140 160 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16F Bil $ U.S. Net Cash Income Source: USDA • Net Cash Income is the sum of crop and livestock receipts, direct government payments and other farm-related income (e.g
Slide 4: Crop Nutrient Affordability a Significant Tailwind for Farmers
Crop Nutrient Affordability a Significant Tailwind for Farmers Based on actual market prices Less A ffordable M ore A ffordable 4 0.40 0.60 0.80 1.00 1.20 1.40 1.60 05 06 07 08 09 10 11 12 13 14 15 16 Plant Nutrient Affordability Plant Nutrient Price Index / Crop Price Index Affordability Metric Ave
Slide 5: Agricultural Backdrop
Agricultural Backdrop 5 Corn, soybeans and wheat prices are making headlines But El Niño left its mark on several commodities Brazil especially benefits from high sugar, cotton and coffee prices 10 11 12 13 14 15 16 17 18 19 20 21 Sep-15 Dec-15 Mar-16 Jun-16 US$ CWT Source: NYMEX Sugar Prices Daily
Slide 6: Good Demand Fundamentals
Good Demand Fundamentals 6 No change in 2016 forecast ranges Bunching of demand expected in second half 2016 Shipments projected to accelerate in 2017 65‐66 66‐68 30 35 40 45 50 55 60 65 70 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16F17F Global Phosphate ShipmentsMil Tonnes DAP/MAP/NPS/TSP So
Slide 7: FX Impact on Supply
FX Impact on Supply 7 FSU exporters have benefited from a collapse of local currencies Russian ruble and Belarussian ruble are down 45% and 50% since 2014 Q1 Brazil potash price has declined 60% in dollars but is off just 5% in Belarussian rubles since January 2012 40 50 60 70 80 90 100 110 Jan-14 J
Slide 8: Multiple Actions to Reduce Costs
Multiple Actions to Reduce Costs 8 *Production costs are reflective of actual costs, excluding realized mark‐to‐market gains and losses. These costs are captured in inventory and are not necessarily reflective of costs included in costs of goods sold for the period. $67 $73 $100 $74 $36 $19 $‐ $20 $
Slide 9: North American Potash Operations: Optimized, Efficient, Strategically Located
North American Potash Operations: Optimized, Efficient, Strategically Located 46% 54% Potash Sales 2012-15 North America Offshore Corporate Headquarters Business Unit Office Deep Shaft Mine Solution Mine Export Terminal and Shipping • Our sales outside of the U.S. and Canada of Saskatchewan potash p
Slide 10: Low Cash Cost Opportunity
Low Cash Cost Opportunity 10 *Production costs are reflective of actual costs, excluding realized mark‐to‐market gains and losses. These costs are captured in inventory and are not necessarily reflective of costs included in costs of goods sold for the period. *Assumes 1.30: 1 CAD to USD. $53 $71 $6
Slide 11: Phosphate Operations: Vertically integrated, low cost
Phosphate Operations: Vertically integrated, low cost U.S. Phosphate Operations Additional Phosphate Operations Faustina, LA ammonia and concentration plant Peru: 35% equity stake in Bayovar phosphate rock mine Saudi Arabia: 25% equity stake in world‐scale Ma’aden II mine and chemical complex
Slide 12: Mosaic Phosphates: Operational Excellence
$39 $0 $5 $10 $15 $20 $25 $30 $35 $40 $45 $50 2011 2012 2013 2014 2015 D o l l a r s / T o n n e Mining Cash Costs/Tonne of Phosphate Rock Mosaic Phosphates: Operational Excellence Source: Mosaic 12
Slide 13: Mosaic: History of Innovation
Mosaic: History of Innovation Source: Mosaic 13 0% 5% 10% 15% 20% 25% ‐ 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 2011 2012 2013 2014 2015 T h o u s a n d T o n n e s MicroEssentials® sales volume MicroEssentials® % of phosphate product volumes
Slide 14: Mosaic: Effective Capital Management
Mosaic: Effective Capital Management Source: Mosaic 14 * 2013 through 2015 18% 13% 29% 40% Capital Allocation: Three Year Summary* Maintenance Organic Growth Investment Commitments Return to Shareholders (dividends & repurchases) ($ in billions) Total: $11.5 Billion A Balanced Approach to Capital Al
Slide 15: Managing Costs and Capital
Managing Costs and Capital • $500 million Expense Reduction • +$75 million from Support Functions • Asset Optimization • Lower Capital Spending 15
Slide 16: Long Term
Long Term 13
Slide 17: Yield Growth Required To Keep Up With Demand
Yield Growth Required To Keep Up With Demand And The Long-term Trend Is Up 1.75 2.00 2.25 2.50 2.75 3.00 3.25 3.50 3.75 4.00 750 775 800 825 850 875 900 925 950 975 80 85 90 95 00 05 10 15F 20F 25F 30F MT HaMil Ha Actual Area Forecast Area Actual Yield Required Yield 1980-12 Yield Trend Source: USDA
Slide 18: Mosaic's Focus
Mosaic’s Focus Build on Mosaic’s Track Record of Success: Execution Smart Investments Environmental Stewardship & Safety Prudently Manage Capital Grow Value for Mosaic’s Shareholders 18
Slide 19: Thank you
Thank you 16
Slide 20: Global Phosphate Shipment Forecasts by Region
Global Phosphate Shipment Forecasts by Region (August 2, 2016) Source: CRU and Mosaic. Numbers may not sum to total due to rounding. * NPS products included in this analysis are those with a combined N and P2O5 nutrient content of 45 units or greater. Million Tonnes DAP/MAP/NPS*/TSP 2015R Aug Low 20
Slide 21: Global Potash Shipment Forecasts by Region
Global Potash Shipment Forecasts by Region (August 2, 2016) Muriate of Potash Million Tonnes (KCl) 2015 Aug Low 2016F Aug High 2016F Aug Low 2017F Aug High 2017F Comments China 15.9 12.8 13.0 13.7 14.1 Shipments this year are projected to drop more than previously anticipated due to the delayed sett