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Potash News Update: PotashCorp’s 4Q15 Results

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PotashCorp’s 4Q15 earnings

The Potash Corporation of Saskatchewan (POT), also known as PotashCorp, reported its 4Q15 earnings on January 28, with EPS (earnings per share) of $0.24. YTD (year-to-date), shares have fallen by 9.7%.

PotashCorp competitor the Mosaic Company (MOS) also fell by 16.6%. CF Industries Holdings (CF) and Agrium (AGU) have also fallen by of 25.6% and 2.1%, respectively. The broader VanEck Vectors Agribusiness ETF (MOO) has trended with these companies, returning -7.8% YTD.

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Results highlights

Below are several key takeaways from Potash’s 4Q15 results:

  • PotashCorp’s 4Q15 earnings of $0.24 per share missed analyst estimates of $0.30 per share.
  • The company’s 3Q15 EPS fell by 51%, down from $0.49 in the corresponding quarter one year ago.
  • For the full year 2015, PotashCorp’s EPS came in at $1.52, down from $1.89 one year ago in 2014.
  • During the fourth quarter, PotashCorp generated $1.2 billion in revenues, a 29% fall from nearly $1.8 billion in 4Q14. Most of this weakness continue to come from the nitrogen segment, which contributed to the decline coming from UAN, urea, and ammonia prices.
  • Gross margins for all combined segments came in at $386 million, down from $746 million in the corresponding quarter one year ago in 4Q14.

Series overview

In this series, we’ll analyze what the future holds for PotashCorp in light of its 4Q15 earnings. We’ll discuss the performance and outlook for each of the company’s three segments. We’ll also discuss prices, shipments, and volumes, which are key to PotashCorp’s revenues, and look at valuation multiples for the company.

Let’s begin with PotashCorp’s 4Q15 sales.

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