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PotashCorp.com
Q2 2016 Conference CallJuly 28, 2016
Forward-looking Statements
Slide #2
Performance
Second-Quarter 2016 Highlights
• Earnings of $0.14 per share1, including:
- Share of Canpotex’s Prince Rupert project exit costs of $0.02 per share
- Unfavorable discount rate adjustment to asset retirement obligations of $0.01 per share
- Impairment of investment in Sinofert Holdings Limited of $0.01 per share
• Intend to reduce quarterly dividend by 60 percent to $0.10 per share
• Market value of investments2 approximately $3.8 billion, or $4 per PotashCorp share3
• Expect global potash shipments of 61-64 million tonnes in 2017
1 All references to per-share amounts pertain to diluted net income per share2 Arab Potash Company, Israel Chemicals Ltd., Sinofert Holdings Limited, and Sociedad Quimica y Minera de Chile S.A. 3 As of market close on July 27, 2016
Source: PotashCorp
Slide #4
Lower Prices Primary Contributor to Weaker Gross Margin
Quarterly Gross Margin Comparison
Q2 2015
Potash Nitrogen Phosphate Q22016
0
150
300
450
600
750 $711
$243
-$294
-$92
-$82
Gross Margin - US$ Millions
Potash• Lower realizations due to weaker pricing environment and
Canpotex Prince Rupert port exit costs
• Lower per-tonne costs due to higher proportion of production from Saskatchewan mines, lower royalties and weaker Canadian dollar
Nitrogen• Weaker realizations due to weaker benchmark pricing
• Lower sales volumes due to weaker demand
• Lower costs due to reduced natural gas prices
Phosphate• Lower prices due to weaker demand environment
• Unfavorable discount rate adjustment to asset retirement obligations and inventory writedowns more than offset benefit of lower input costs
Source: PotashCorp
Slide #5
Outlook
Jan-1
5
Feb-1
5
Mar-1
5
Apr-15
May-1
5
Jun-1
5Ju
l-15
Aug-15
Sep-15
Oct-15
Nov-1
5
Dec-1
5
Jan-1
6
Feb-1
6
Mar-16
Apr-16
May-1
6
Jun-1
6Ju
l-16
50
75
100
125Crop Price Index* Fertilizer Price Index**
* Based on corn, soybean and wheat prices (weighted by global consumption).
** Based on urea, DAP and KCl prices (weighted by global consumption).
Price Index (January 2015 Average = 100)
Crop and Fertilizer Price IndexFertilizer Represents Strong Value for Farmers
Source: Bloomberg, Fertilizer Week
Decline in fertilizer prices relative to
crop prices provides incentive for
farmers
Slide #7
Source: Fertecon, CRU, PotashCorp
World Potash ShipmentsLate Chinese Contract Settlement Has Historically Created a Rebound in Demand
0
10
20
30
40
50
60
70
2012 20132008 2010 20112009 2017F2016F20052004 20062003 2014 20152007
+87% +5%
+5%
+15%
Denote years when China has had early potash contract settlements.
Million Tonnes KCl
July
27,
200
6
Apr
il 16
, 200
8
No
Con
trac
t
Mar
ch 2
0, 2
012
Mar
ch 3
0, 2
015
Denote years when China has had late potash contract settlements.
Note: 2016F & 2017F based on midpoint of shipment forecast range.
Slide #8
14 16F 15 17
F 14 16F 15 17
F 14 16F
0
2
4
6
8
10
12
14
16
18
Million Tonnes KCl
World Potash Shipments by Market
Source: Fertecon, CRU, Industry Publications, PotashCorp
ChinaIndia L. AmericaOther Asia N. America
Expect Demand of 61-64 Million Tonnes in 2017
Note: Shaded bars represent shipment forecast range.
Highlights (2017F)
China: 14.0 – 15.0mmt • Lower inventories, more timely contract settlements, and
strong consumption trends expected to support shipments
India: 4.7 – 5.2mmt• Lower farm retail prices expected to support consumption
growth
Other Asia: 8.8 – 9.3mmt • Supportive crop economics and the absence of lengthy
Asian contract deferrals are expected to support more normalized demand
Latin America: 11.5 – 12.0mmt• Agronomic need and increased crop acreage expected to
support demand growth
North America: 9.3 – 9.8mmt• Potash affordability and nutrient requirements anticipated
to support healthy demand
Slide #9
Global Potash S&D – 2017 Outlook
Other N. American Producers**
~66
POT2017F Operational Capability*
~68
2017F Demand
~62.5
Demand Growth
2016FDemand
~59.5
~65
2016FOperational Capability*
Other Producers
2017F Operational Capability***
Source: Fertecon, CRU, Public Filings, PotashCorp
Expect Strong Demand Growth; Rocanville Primary Source of New Supply
Global Potash S&D - Million Tonnes KCl
Slide #10
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
Global Potash S&D – 2017 Outlook
Other N. American
Producers**
OtherProducers
2017F Demand Growth
Other POT2017F Operational Capability Change
Other Asia Latin AmericaChina India
Source: Fertecon, CRU, Public Filings, PotashCorp
Expect Strong Demand Growth; Rocanville Primary Source of New Supply
2017F Yr/Yr Demand Growth – Million Tonnes KCl
2017F Yr/Yr Operational Capability* Change – Million Tonnes KCl
Slide #11
Guidance
2016 Guidance*
Third Quarter
• Earnings per share: $0.05-$0.10
Full Year
• Earnings per share: $0.40-$0.55
• Potash sales volumes: 8.3-8.8 million tonnes
• Potash gross margin: $400-$600M
• Nitrogen and phosphate gross margin: $400-$550M
• Capital expenditures1: ~$800M
*Guidance as at July 28, 20161Does not include capitalized interest
Source: PotashCorp
Slide #13
2016 Guidance*
Full Year
• Effective tax rate: 16-18 percent
• Provincial mining and other taxes1: 23-26 percent
• Selling and administrative expenses: $220-$230M
• Finance costs: $210-$220M
• Income from equity investments2: $120-$140M
• Annual FX rate assumption: CDN$1.32 per US$
• Annual EPS sensitivity to FX: US$ strengthens vs. CDN$ by $0.02 = +$0.01 to EPS
* Guidance as at July 28, 20161 As a percentage of potash gross margin, excluding New Brunswick severance costs2 Includes income from dividends and share of equity earnings
Source: PotashCorp
Slide #14
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