Mosaic Closes Mine As Profits Plummet 70%
The Mosaic Company said Tuesday that its third-quarter profit fell 70 percent and that it is closing one of its potash mines in Michigan.
The Plymouth-based potash and phosphate fertilizer provider announced that net earnings for the third quarter, which ended September 30, totaled $124.4 million, or $0.29 per share, down from $417.4 million, or $0.98 per share, during the same period in 2012. Earnings per share were $0.05 lower than what analysts polled by Thomson Reuters had expected.
Revenue, meanwhile, totaled $1.91 billion, down about 28 percent from $2.65 billion in the third quarter of 2012. Third-quarter revenue fell short of analysts’ projections of $1.97 billion.
Shares of Mosaic’s stock were trading down about 1.65 percent at $45.96 Tuesday afternoon, and they are down roughly 19 percent this year.
President and CEO Jim Prokopanko blamed the weak quarterly results on lower potash and phosphate prices, a late North American fall season, and cautious dealer behavior.
“We believe the current challenges in the environment in which we operate, for both phosphate and potash, are cyclical in nature and provide Mosaic opportunities to deploy capital, including shareholder distributions,” Prokopanko said in a statement. “The long-term outlook for Mosaic remains compelling.”
In addition to closing a mine in Michigan, the company said it would be exiting the “underperforming” Argentina and Chile distribution businesses, to focus more heavily on its growing business in Brazil.
Prokopanko said the company expects pricing to remain challenging going into 2014 and that international demand, especially in India and China, remains unpredictable.
Mosaic is among Minnesota’s 10 largest public companies based on revenue, which totaled $11.1 billion in its most recently completed fiscal year. The company was also recently named among the “World’s Most Ethical” companies.