Mosaic sales up 17% in nine-month of 2012

The Mosaic Company reported third quarter fiscal 2012 net earnings of $273 million, compared to $542 million a year ago.

The decline was primarily driven by lower potash volumes and higher phosphate raw material costs. Earnings per diluted share were $0.64 in the quarter compared to $1.21 in the quarter last year.

In the 2012 quarter, earnings per diluted share were negatively impacted by notable items totaling $0.08, primarily foreign currency transaction losses. Mosaic's net sales in the third quarter of fiscal 2012 were $2.2 billion, flat with the same period last year, as growth in phosphate sales was offset by declines in potash sales.

"We are continuing to make significant strategic progress for long-term success even as we work through seasonal and cyclical market factors, and we feel very good about our business momentum," said Jim Prokopanko, President and Chief Executive Officer of Mosaic.

"Our potash expansion initiative remains on track and on budget, as we bring several major projects to completion this calendar year. Our innovative premium phosphate product, MicroEssentials, continues to win an increasing share of North American sales, and we will have new capacity in fiscal 2013.

"During the third fiscal quarter, we reached two important agreements to resolve matters that created uncertainty for investors. We reached an agreement on our potash tolling dispute, which will result in 1.3 million tonnes of peaking capacity for Mosaic beginning in January 2013, and we reached a settlement agreement to allow us to return to full operation at the South Fort Meade phosphate mine. We also demonstrated both the strength of our balance sheet and our commitment to shareholders by increasing our annual dividend by 150 percent."

Mosaic's gross margin for the third quarter of fiscal 2012 was $522 million, or 24 percent of net sales, compared to $854 million, or 39 percent of net sales, a year ago. Third quarter operating earnings were $414 million, a decrease of 46 percent compared to $771 million a year ago. The decreases in gross margin and operating earnings were driven primarily by lower potash volumes and higher phosphate raw material costs.

Cash flow provided by operating activities in the third quarter of fiscal 2012 was $405 million compared to $366 million in the prior year. Capital expenditures totaled $412 million in the quarter. Mosaic's total cash and cash equivalents were $3.2 billion and long-term debt was $1.0 billion as of February 29, 2012.