CF Industries’ earnings
CF Industries (CF) reported its 1Q18 earnings on May 2, after the market closed. The company reported EPS (earnings per share) of $0.27, beating analysts’ estimate of $0.26 and its 1Q17 EPS of -$0.10.
However, the company missed analysts’ sales estimate of $1.1 billion, posting sales of $0.96 billion. The miss was likely a result of lower shipment volumes due to the season starting late.
The company’s realized prices rose in all segments, driven higher by tighter demand, supply balance, and less product coming out of China and Eastern Europe. The company also had lower natural gas costs, with its costs of sales falling YoY (year-over-year) to $3.33 per MMBtu (million British thermal units) from $3.65 per MMBtu.
The company added that exports from China fell 77% YoY due to higher freight and energy costs. China’s targeting of zero fertilizer growth has weighed on urea production and exports from China, which has helped fertilizer companies (MOO) such as Nutrien (NTR), Mosaic (MOS), and Intrepid Potash (IPI). These companies have experienced significant price decline across the board due to excess supply. We’ll publish our full analysis of the company’s 1Q18 results shortly.