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Potash Corp : Earnings fell 71% to $81 million on price slump in Q3 of 2016
Nov. 18, 2016
Potash Corp's third-quarter profit and sales came in well below year-earlier levels as a continued slump in fertilizer-nutrient prices outweighed a pickup in volumes.
The big Saskatoon, Saskatchewan-based fertilizer company, which earlier this year agreed to merge with peer Agrium Inc. , said potash sales volumes were a record in the quarter, and spot prices for the key fertilizer ingredient were up about 15% from lows earlier in the year. Still, on a year-over-year basis, potash prices slumped about 40%, offsetting record potash sales volumes of 2.5 million metric tons.
Prices for nitrogen and phosphate, two other key fertilizer components produced by the company, were also well below year-earlier levels.
Overall, Potash's third-quarter earnings fell 71% to $81 million, or 10 cents a share. Analysts were expecting earnings of 9 cents. Sales fell 26% to $1.14 billion.
Slumping fertilizer nutrient prices and lower sales volumes led Potash Corp. last quarter to slash its annual earnings guidance and cut its quarterly dividend for a second time this year.
On its planned merger with Agrium, announced in mid-September, Potash said support from shareholders to date "has been very encouraging."
"We look forward to realizing the value that is unlocked through this transaction," Potash Chief Executive Jochen Tilk said in a release, noting that early vote results have been "overwhelmingly in favor" of the deal.
Subject to regulatory, court and shareholder approvals, Potash and Agrium expect the merger to close in mid-2017.
Source: Potash Corp
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