Healthy Price Realizations in a Supply-Driven Market
Record Quarterly Sales Volume of Over 4.5 Million Product Tons
New Donaldsonville Ammonia Plant Expected to Begin Production in the
Third Quarter
New Port Neal Ammonia Plant Mechanically Complete
DEERFIELD, Ill.--(BUSINESS WIRE)--
CF Industries Holdings, Inc. (NYSE: CF), the global leader in nitrogen
fertilizer manufacturing and distribution, today announced results for
its second quarter ended June 30, 2016.
Second Quarter Highlights
-
Net earnings of $47 million, or $0.20 per diluted share; adjusted net
earnings(1) of $77 million, or $0.33 per diluted share(1)
-
EBITDA(2) of $329 million; adjusted EBITDA(2) of
$342 million
-
Accelerated depreciation on capital additions driving a tax refund of
approximately $690 million in 2017 from carrybacks of current year tax
losses to prior tax years, which is based on the timing of the
completion of certain capital projects
-
New Donaldsonville, LA, ammonia plant expected to begin production
during the third quarter of 2016
-
New Port Neal, IA, ammonia plant is mechanically complete
-
Offsites and utilities are complete and operational
-
Ammonia production is expected to begin late in the third quarter,
or beginning of the fourth quarter of 2016, with the urea plant to
follow closely thereafter
-
Record UAN production in the quarter of 1.8 million tons
-
Ammonia production was 99 percent of stated capacity
Year to Date Highlights
-
Net earnings of $73 million or $0.31 per diluted share; adjusted net
earnings(1) of $170 million or $0.72 per diluted share(1)
-
EBITDA(2) of $536 million; adjusted EBITDA(2) of
$642 million
_________________________________________________________________________
|
(1)
|
|
See reconciliations of adjusted net earnings and adjusted net
earnings per diluted share to the most directly comparable GAAP
measures in the tables accompanying this release.
|
|
(2)
| |
EBITDA is defined as net earnings attributable to common
stockholders plus interest expense (income)-net, income taxes, and
depreciation and amortization. See reconciliations of EBITDA and
adjusted EBITDA to the most directly comparable GAAP measures in the
tables accompanying this release.
|
| |
|
Overview of Results
CF Industries Holdings, Inc., today announced second quarter 2016 net
earnings attributable to common stockholders of $47 million, or $0.20
per diluted share, and EBITDA of $329 million. Adjusted net earnings was
$77 million, or $0.33 per diluted share, and adjusted EBITDAfor
the second quarter of 2016 was $342 million. These results compare to
second quarter 2015 net earnings attributable to common stockholders of
$352 million, or $1.49 per diluted share, and EBITDA of $670 million.
Adjusted net earnings was $380 million, or $1.61 per diluted share, and
adjusted EBITDA was $708 million for the second quarter of 2015. These
results include a realized loss on natural gas hedges of $61 million for
the second quarter of 2016, compared to a realized loss on natural gas
hedges of $5 million for the second quarter of 2015.
For the first six months of 2016, net earnings attributable to common
stockholders was $73 million, or $0.31 per diluted share, and EBITDA was
$536 million. Adjusted net earnings was $170 million, or $0.72 per
diluted share, and adjusted EBITDA was $642 million for the first six
months of 2016. These results compare to the first six months of 2015
net earnings attributable to common stockholders of $583 million, or
$2.44 per diluted share, and EBITDA of $1.16 billion. Adjusted net
earnings for the first six months of 2015 was $600 million, or $2.52 per
diluted share, and adjusted EBITDA was $1.18 billion. These results
include a realized loss on natural gas hedges of $117 million for the
first six months of 2016, compared to a realized loss on natural gas
hedges of $37 million for the first six months of 2015.
Included in the company's reported earnings is the $150 million payment
made to OCI N.V. in connection with the May 22, 2016 termination of the
combination agreement between the company and OCI.
As of June 30, 2016, the company has prepaid income taxes in the amount
of $855 million. This includes approximately $690 million from the
carryback of certain U.S. tax losses from the current year to prior year
periods, which is based on the timing of the completion of certain
capital projects. These U.S. tax losses are primarily related to tax
depreciation of the capital additions that have been and are expected to
be placed into service in 2016. The refund related to this tax loss
carryback is expected to be received in 2017.
Net sales decreased in the second quarter of 2016 to $1.13 billion from
$1.31 billion in the same period last year due to lower average selling
prices across all segments. The decrease was partially offset by an
increase in sales volume, including the impacts of the company's
capacity expansion projects and the inclusion of CF Fertilisers UK.
Selling prices were negatively impacted by continued oversupply of
nitrogen driven by global nitrogen capacity additions, coupled with
lower energy and ocean freight costs, and softer global ammonia demand
from industrial users, including phosphate fertilizer production.
In North America, solid demand at the beginning of April initially
supported selling prices in the second quarter of 2016, but several
weeks of wet and cool weather delayed fertilizer applications.
Additionally, a high level of imported products that arrived in late
April and into May subsequently pressured prices.
Cost of sales decreased 3 percent in the second quarter of 2016 compared
to the second quarter of 2015 due primarily to an unrealized net
mark-to-market gain on natural gas derivatives of $211 million, compared
to an unrealized net mark-to-market gain on natural gas derivatives of
$19 million in the second quarter of 2015. The decrease was partially
offset by a realized loss on natural gas hedges of $61 million compared
to a realized loss on natural gas derivatives of $5 million in the prior
year's comparable period, as well as the inclusion of CF Fertilisers UK
in the company's second quarter 2016 financial results.
The new ammonia plant at Donaldsonville, LA, is expected to begin
production during the third quarter of 2016. At Port Neal, IA, the new
ammonia plant complex is mechanically complete, and the offsites and
utilities are complete and operational. Ammonia production is expected
to begin late in the third quarter, or beginning of the fourth quarter
of 2016, with the urea plant to follow closely thereafter.
“Our plants ran well and we set all-time records for production and
sales volume while achieving healthy price realizations, despite
difficult market conditions," said Tony Will, president and chief
executive officer, CF Industries Holdings, Inc.
In the second quarter of 2016, the average cost of natural gas in cost
of sales for the company was $2.85 per MMBtu, which includes a realized
loss of $0.75 per MMBtu on natural gas hedges, totaling $61 million.
This compares to the average cost of natural gas in cost of sales of
$2.86 per MMBtu, which includes a realized loss of $0.07 per MMBtu on
natural gas hedges for the second quarter of 2015, totaling $5 million.
During the second quarter of 2016, the average price of natural gas at
Henry Hub in North America was $2.10 per MMBtu, and the average price of
natural gas at the National Balancing Point in the United Kingdom was
$4.50 per MMBtu.
The company did not enter into any additional natural gas hedges in the
second quarter of 2016.
CHS Distribution
On July 31, 2016, the Board of Managers of CF Industries Nitrogen, LLC
approved a distribution payment to CHS of approximately $75 million,
which was paid on August 1, 2016. This total is comprised of
approximately $30 million related to February and March 2016, and
approximately $45 million related to the second quarter of 2016.
Outlook
The demand outlook for the 2017 fertilizer season is positive as major
nitrogen-consuming markets are expected to see continued increases in
product applications. However, abundant nitrogen supply will continue to
pressure global pricing as new ammonia, urea and UAN production come on
line in the second half of 2016. Additional urea and UAN production
capacity in North America is scheduled to come on line in the first or
second quarter of 2017 with global capacity additions declining
significantly thereafter. As a result, the company expects a continued
challenging price environment through 2017, which will economically
pressure high-cost producers, leading to decreases in exports,
additional production curtailments, and permanent shutdowns. A lack of
meaningful new construction activity after the middle of 2017, coupled
with capacity closures, is expected to lead to price recovery in 2018
and beyond. In the near-term and longer-term, North American producers
should remain at the very low end of the cost curve due to the plentiful
supply of North American natural gas.
Capital Expenditures
The company expects to have total capital expenditures for 2016 in the
range of $2.0 billion to $2.2 billion, of which $1.6 billion to $1.7
billion will be for the capacity expansion projects and $450 million to
$500 million for sustaining, improvement, and other projects.
Increases in planned capital expenditures associated with the capacity
expansion projects resulted from delays in completion time related to
labor productivity and performance of third-party contractors.
Liquidity
On July 29, 2016, the company amended its senior unsecured revolving
credit agreement to reduce the size of the facility from $2.0 billion
back to the $1.5 billion in place prior to the announcement of the OCI
transaction, and to increase the maximum total net leverage covenant
(net debt to trailing twelve month EBITDA) from the third quarter of
2016 through the fourth quarter of 2017. As of June 30, 2016, the
covenant specified a net leverage ratio not greater than 3.75x. As of
July 29, 2016, this has been amended as follows:
-
5.25x from the third quarter of 2016 through the first quarter of 2017;
-
5.00x in the second quarter of 2017;
-
4.75x in the third quarter of 2017;
-
4.00x in the fourth quarter of 2017; and
-
3.75x in the first quarter of 2018 and beyond.
The company is in the process of seeking a similar amendment to modify
the total net leverage covenant under the note purchase agreement
governing the company’s outstanding senior notes due 2022, 2025 and
2027. As of June 30, 2016, the company was in compliance with all
covenants under the credit agreement and note purchase agreement.
“We remain firmly committed to our investment grade credit ratings.
Through this period of depressed nitrogen prices, we are keenly focused
on maximizing our liquidity and balance sheet strength. This will give
us the flexibility to retire maturing debt in 2018 if that becomes
necessary," said Will. "In addition, we believe it is prudent to suspend
share repurchases and allow the current share repurchase authorization
to expire in December 2016."
|
| |
| |
Consolidated Results |
| | | |
|
| | Three months ended
June 30, | | Six months ended
June 30, |
| | 2016 |
| 2015 | | 2016 |
| 2015 |
| | (dollars in millions, except per share and per MMBtu amounts) |
|
Net sales
| |
$
|
1,134
| | |
$
|
1,311
| | |
$
|
2,138
| | |
$
|
2,265
| |
|
Cost of sales
| |
607
|
| |
625
|
| |
1,394
|
| |
1,163
|
|
|
Gross margin
| |
$
|
527
|
| |
$
|
686
|
| |
$
|
744
|
| |
$
|
1,102
|
|
| | | | | | | |
|
|
Gross margin percentage
| |
46.5
|
%
| |
52.3
|
%
| |
34.8
|
%
| |
48.6
|
%
|
| | | | | | | |
|
|
Net earnings attributable to common stockholders
| |
$
|
47
| | |
$
|
352
| | |
$
|
73
| | |
$
|
583
| |
|
Adjusted net earnings (1) | |
$
|
77
| | |
$
|
380
| | |
$
|
170
| | |
$
|
600
| |
| | | | | | | |
|
|
Net earnings per diluted share
| |
$
|
0.20
| | |
$
|
1.49
| | |
$
|
0.31
| | |
$
|
2.44
| |
|
Adjusted net earnings per diluted share(1) | |
$
|
0.33
| | |
$
|
1.61
| | |
$
|
0.72
| | |
$
|
2.52
| |
| | | | | | | |
|
|
EBITDA(1) | |
$
|
329
| | |
$
|
670
| | |
$
|
536
| | |
$
|
1,156
| |
|
Adjusted EBITDA(1) | |
$
|
342
| | |
$
|
708
| | |
$
|
642
| | |
$
|
1,178
| |
| | | | | | | |
|
|
Tons of product sold (000s)
| |
4,557
| | |
3,611
| | |
8,608
| | |
6,523
| |
| | | | | | | |
|
|
Supplemental data (per MMBtu):
| | | | | | | | |
|
Natural gas costs in cost of sales(2) | |
$
|
2.10
| | |
$
|
2.79
| | |
$
|
2.29
| | |
$
|
3.10
| |
|
Realized derivatives loss in cost of sales(3) | |
0.75
|
| |
0.07
|
| |
0.77
|
| |
0.31
|
|
|
Cost of natural gas in cost of sales
| |
$
|
2.85
| | |
$
|
2.86
| | |
$
|
3.06
| | |
$
|
3.41
| |
| | | | | | | |
|
|
Average daily market price of natural gas (per MMBtu):
| | | | | | | | |
|
Henry Hub
| |
$
|
2.10
| | |
$
|
2.72
| | |
$
|
2.04
| | |
$
|
2.80
| |
|
National Balancing Point UK | |
$
|
4.50
| | |
$
|
6.85
| | |
$
|
4.43
| | |
$
|
7.06
| |
| | | | | | | |
|
|
Unrealized net mark-to-market (gain) loss on natural gas derivatives
| |
$
|
(211
|
)
| |
$
|
(19
|
)
| |
$
|
(190
|
)
| |
$
|
(47
|
)
|
| | | | | | | |
|
|
Capital expenditures
| |
$
|
703
| | |
$
|
587
| | |
$
|
1,379
| | |
$
|
1,032
| |
| | | | | | | |
|
|
Production volume by product tons (000s):
| | | | | | | | |
|
Ammonia(4) | |
1,991
| | |
1,843
| | |
3,994
| | |
3,660
| |
|
Granular urea
| |
808
| | |
593
| | |
1,627
| | |
1,218
| |
|
UAN (32%)
| |
1,771
| | |
1,484
| | |
3,289
| | |
2,914
| |
|
AN
| |
386
| | |
202
| | |
817
| | |
431
| |
_______________________________________________________________________________
|
(1)
|
|
See reconciliations of EBITDA, adjusted EBITDA, adjusted net
earnings and adjusted net earnings per diluted share to the most
directly comparable GAAP measures in the tables accompanying this
release.
|
|
(2)
| |
Includes the cost of natural gas that is included in cost of sales
during the period under the first-in, first-out (FIFO) inventory
cost method.
|
|
(3)
| |
Includes the realized gains and losses on natural gas derivatives
settled during the period. Excludes unrealized mark-to-market gains
and losses on natural gas derivatives.
|
|
(4)
| |
Gross ammonia production including amounts subsequently upgraded
into other products.
|
| |
|
Segment Results
Ammonia Segment
CF Industries’ ammonia segment produces anhydrous ammonia (ammonia),
which is the company’s most concentrated nitrogen fertilizer, containing
82 percent nitrogen. The results of the ammonia segment consist of sales
of ammonia to external customers. In addition, ammonia is the “basic”
nitrogen product that the company upgrades into other nitrogen
fertilizers such as urea, UAN solution, and AN.
|
| |
| |
| | Three months ended
June 30, | | Six months ended
June 30, |
| | 2016 |
| 2015 | | 2016 |
| 2015 |
| | (dollars in millions, except per ton amounts) |
|
Net sales
| |
$
|
358
| | |
$
|
599
| | |
$
|
625
| | |
$
|
887
| |
|
Cost of sales
| |
152
|
| |
260
|
| |
356
|
| |
428
|
|
|
Gross margin
| |
$
|
206
|
| |
$
|
339
|
| |
$
|
269
|
| |
$
|
459
|
|
| | | | | | | |
|
|
Gross margin percentage
| |
57.5
|
%
| |
56.6
|
%
| |
43.0
|
%
| |
51.8
|
%
|
| | | | | | | |
|
|
Sales volume by product tons (000s)
| |
870
| | |
1,060
| | |
1,607
| | |
1,591
| |
|
Sales volume by nutrient tons (000s)(1) | |
713
| | |
870
| | |
1,318
| | |
1,305
| |
| | | | | | | |
|
|
Average selling price per product ton
| |
$
|
411
| | |
$
|
565
| | |
$
|
389
| | |
$
|
557
| |
|
Average selling price per nutrient ton(1) | |
502
| | |
689
| | |
474
| | |
679
| |
| | | | | | | |
|
|
Gross margin per product ton
| |
$
|
237
| | |
$
|
320
| | |
$
|
167
| | |
$
|
288
| |
|
Gross margin per nutrient ton(1) | |
289
| | |
390
| | |
204
| | |
352
| |
| | | | | | | |
|
|
Depreciation and amortization
| |
$
|
19
| | |
$
|
21
| | |
$
|
40
| | |
$
|
43
| |
| | | | | | | |
|
|
Unrealized net mark-to-market (gain) loss on natural gas derivatives
| |
$
|
(69
|
)
| |
$
|
(4
|
)
| |
$
|
(62
|
)
| |
$
|
(11
|
)
|
_______________________________________________________________________________
(1) Nutrient tons represent the tons of nitrogen within the
product tons.
Comparison of 2016 to 2015 Second Quarter and first six months periods:
-
Ammonia sales volume increased slightly for the first six months of
2016 compared to the comparable period in 2015. An early start to
spring applications drew sales into the first quarter of 2016 from the
second quarter of 2016, however, year-to-date results were strong.
-
Ammonia average selling prices decreased due to an increase in global
nitrogen supply driven by capacity additions coupled with lower energy
and ocean freight costs.
-
Ammonia gross margin per ton decreased due to lower average selling
prices which were partially offset by an increase in unrealized net
mark-to-market gains on natural gas derivatives.
Granular Urea Segment
CF Industries’ granular urea segment produces granular urea, which
contains 46 percent nitrogen. Produced from ammonia and carbon dioxide,
it has the highest nitrogen content of any of the company’s solid
nitrogen fertilizers.
|
| |
| |
| | Three months ended
June 30, | | Six months ended
June 30, |
| | 2016 |
| 2015 | | 2016 |
| 2015 |
| | (dollars in millions, except per ton amounts) |
|
Net sales
| |
$
|
240
| | |
$
|
211
| | |
$
|
475
| | |
$
|
423
| |
|
Cost of sales
| |
118
|
| |
92
|
| |
293
|
| |
192
|
|
|
Gross margin
| |
$
|
122
|
| |
$
|
119
|
| |
$
|
182
|
| |
$
|
231
|
|
| | | | | | | |
|
|
Gross margin percentage
| |
50.8
|
%
| |
56.2
|
%
| |
38.3
|
%
| |
54.5
|
%
|
| | | | | | | |
|
|
Sales volume by product tons (000s)
| |
972
| | |
600
| | |
1,891
| | |
1,216
| |
|
Sales volume by nutrient tons (000s)(1) | |
447
| | |
276
| | |
870
| | |
559
| |
| | | | | | | |
|
|
Average selling price per product ton
| |
$
|
247
| | |
$
|
352
| | |
$
|
251
| | |
$
|
348
| |
|
Average selling price per nutrient ton(1) | |
537
| | |
764
| | |
546
| | |
757
| |
| | | | | | | |
|
|
Gross margin per product ton
| |
$
|
126
| | |
$
|
198
| | |
$
|
96
| | |
$
|
190
| |
|
Gross margin per nutrient ton(1) | |
273
| | |
430
| | |
209
| | |
413
| |
| | | | | | | |
|
|
Depreciation and amortization
| |
$
|
25
| | |
$
|
10
| | |
$
|
50
| | |
$
|
20
| |
| | | | | | | |
|
|
Unrealized net mark-to-market (gain) loss on natural gas derivatives
| |
$
|
(55
|
)
| |
$
|
(5
|
)
| |
$
|
(49
|
)
| |
$
|
(12
|
)
|
_______________________________________________________________________________
(1) Nutrient tons represent the tons of nitrogen within the
product tons.
Comparison of 2016 to 2015 Second Quarter and first six months periods:
-
Granular urea sales volume increased due to increased production as a
result of the company's new urea plant coming on line at
Donaldsonville, LA.
-
Granular urea average selling price per ton decreased due to increased
global nitrogen supply driven by capacity additions coupled with lower
energy and ocean freight costs.
-
Granular urea gross margin per ton decreased due to lower average
selling prices which were partially offset by an increase in
unrealized net mark-to-market gains on natural gas derivatives.
UAN Segment
CF Industries’ UAN segment produces urea ammonium nitrate solution
(UAN). UAN is a liquid fertilizer product with nitrogen content that
typically ranges from 28 percent to 32 percent and is produced by
combining urea and ammonium nitrate in solution.
|
| |
| |
| | Three months ended
June 30, | | Six months ended
June 30, |
| | 2016 |
| 2015 | | 2016 |
| 2015 |
| | (dollars in millions, except per ton amounts) |
|
Net sales
| |
$
|
370
| | |
$
|
407
| | |
$
|
679
| | |
$
|
763
| |
|
Cost of sales
| |
197
|
| |
205
|
| |
428
|
| |
402
|
|
|
Gross margin
| |
$
|
173
|
| |
$
|
202
|
| |
$
|
251
|
| |
$
|
361
|
|
| | | | | | | |
|
|
Gross margin percentage
| |
46.8
|
%
| |
49.7
|
%
| |
37.0
|
%
| |
47.3
|
%
|
| | | | | | | |
|
|
Sales volume by product tons (000s)
| |
1,832
| | |
1,504
| | |
3,284
| | |
2,821
| |
|
Sales volume by nutrient tons (000s)(1) | |
577
| | |
475
| | |
1,034
| | |
889
| |
| | | | | | | |
|
|
Average selling price per product ton
| |
$
|
202
| | |
$
|
271
| | |
$
|
207
| | |
$
|
271
| |
|
Average selling price per nutrient ton(1) | |
641
| | |
858
| | |
657
| | |
858
| |
| | | | | | | |
|
|
Gross margin per product ton
| |
$
|
94
| | |
$
|
135
| | |
$
|
76
| | |
$
|
128
| |
|
Gross margin per nutrient ton(1) | |
300
| | |
427
| | |
243
| | |
406
| |
| | | | | | | |
|
|
Depreciation and amortization
| |
$
|
59
| | |
$
|
46
| | |
$
|
117
| | |
$
|
97
| |
| | | | | | | |
|
|
Unrealized net mark-to-market (gain) loss on natural gas derivatives
| |
$
|
(65
|
)
| |
$
|
(8
|
)
| |
$
|
(59
|
)
| |
$
|
(20
|
)
|
_______________________________________________________________________________
(1) Nutrient tons represent the tons of nitrogen within the
product tons.
Comparison of 2016 to 2015 Second Quarter and first six months periods:
-
UAN sales volume increased due to an increase in production as a
result of the company's new UAN plant coming on line at
Donaldsonville, LA, in the first quarter of 2016, as well as increased
demand resulting from favorable application conditions late in the
second quarter 2016.
-
UAN average selling price per ton decreased due to increased global
nitrogen supply driven by capacity additions coupled with lower energy
and ocean freight costs.
-
UAN gross margin per ton decreased due to lower average selling prices
which were partially offset by an increase in unrealized net
mark-to-market gains on natural gas derivatives.
AN Segment
CF Industries' AN segment produces ammonium nitrate (AN). AN is used as
a nitrogen fertilizer with nitrogen content between 29% to 35%, and also
is used by industrial customers for commercial explosives and blasting
systems. AN is produced at the company's Yazoo City, Mississippi;
Billingham, United Kingdom; and Ince, United Kingdom, complexes.
|
| |
| |
| | Three months ended
June 30, | | Six months ended
June 30, |
| | 2016 |
| 2015 | | 2016 |
| 2015 |
| | (dollars in millions, except per ton amounts) |
|
Net sales
| |
$
|
90
| | |
$
|
48
| | |
$
|
215
| | |
$
|
99
| |
|
Cost of sales
| |
90
|
| |
39
|
| |
202
|
| |
82
|
|
|
Gross margin
| |
$
|
—
|
| |
$
|
9
|
| |
$
|
13
|
| |
$
|
17
|
|
| | | | | | | |
|
|
Gross margin percentage
| |
—
|
%
| |
18.8
|
%
| |
6.0
|
%
| |
17.2
|
%
|
| | | | | | | |
|
|
Sales volume by product tons (000s)
| |
453
| | |
224
| | |
1,011
| | |
448
| |
|
Sales volume by nutrient tons (000s)(1) | |
154
| | |
77
| | |
342
| | |
154
| |
| | | | | | | |
|
|
Average selling price per product ton
| |
$
|
199
| | |
$
|
214
| | |
$
|
213
| | |
$
|
221
| |
|
Average selling price per nutrient ton(1) | |
584
| | |
623
| | |
629
| | |
643
| |
| | | | | | | |
|
|
Gross margin per product ton
| |
$
|
—
| | |
$
|
40
| | |
$
|
13
| | |
$
|
38
| |
|
Gross margin per nutrient ton(1) | |
—
| | |
117
| | |
38
| | |
110
| |
| | | | | | | |
|
|
Depreciation and amortization
| |
$
|
28
| | |
$
|
12
| | |
$
|
50
| | |
$
|
24
| |
| | | | | | | |
|
|
Unrealized net mark-to-market (gain) loss on natural gas derivatives
| |
$
|
(9
|
)
| |
$
|
(2
|
)
| |
$
|
(8
|
)
| |
$
|
(4
|
)
|
_______________________________________________________________________________
(1) Nutrient tons represent the tons of nitrogen within the
product tons.
Comparison of 2016 to 2015 Second Quarter and first six months periods:
-
AN sales volume was higher due to the inclusion of CF Fertilisers UK
sales.
-
AN average selling price per ton decreased primarily due to declining
domestic agricultural demand.
-
AN gross margin per ton decreased primarily due to lower average
selling prices, which were partially offset by an increase in
unrealized net mark-to-market gains on natural gas derivatives. In the
second quarter of 2016, gross margin per ton was also negatively
impacted by fixed cost write-offs associated with plant downtime at
the Yazoo City, MS, plant resulting from a tower switch out as part of
the complex conversion to industrial-grade AN when compared to the
second quarter of 2015.
Other Segment
CF Industries’ Other segment includes diesel exhaust fluid (DEF), urea
liquor, nitric acid and compound fertilizer products (NPKs).
|
| |
| |
| | Three months ended
June 30, | | Six months ended
June 30, |
| | 2016 |
| 2015 | | 2016 |
| 2015 |
| | (dollars in millions, except per ton amounts) |
|
Net sales
| |
$
|
76
| | |
$
|
46
| | |
$
|
144
| | |
$
|
93
| |
|
Cost of sales
| |
50
|
| |
29
|
| |
115
|
| |
59
|
|
|
Gross margin
| |
$
|
26
|
| |
$
|
17
|
| |
$
|
29
|
| |
$
|
34
|
|
| | | | | | | |
|
|
Gross margin percentage
| |
34.2
|
%
| |
37.0
|
%
| |
20.1
|
%
| |
36.6
|
%
|
| | | | | | | |
|
|
Sales volume by product tons (000s)
| |
430
| | |
223
| | |
815
| | |
447
| |
|
Sales volume by nutrient tons (000s)(1) | |
84
| | |
45
| | |
157
| | |
88
| |
| | | | | | | |
|
|
Average selling price per product ton
| |
$
|
177
| | |
$
|
206
| | |
$
|
177
| | |
$
|
208
| |
|
Average selling price per nutrient ton(1) | |
905
| | |
1,022
| | |
917
| | |
1,057
| |
| | | | | | | |
|
|
Gross margin per product ton
| |
$
|
60
| | |
$
|
76
| | |
$
|
36
| | |
$
|
76
| |
|
Gross margin per nutrient ton(1) | |
310
| | |
378
| | |
185
| | |
386
| |
| | | | | | | |
|
|
Depreciation and amortization
| |
$
|
12
| | |
$
|
4
| | |
$
|
22
| | |
$
|
15
| |
| | | | | | | |
|
|
Unrealized net mark-to-market (gain) loss on natural gas derivatives
| |
$
|
(13
|
)
| |
$
|
—
| | |
$
|
(12
|
)
| |
$
|
—
| |
_______________________________________________________________________________
(1) Nutrient tons represent the tons of nitrogen within the
product tons.
Comparison of 2016 to 2015 Second Quarter and first six months periods:
-
Other segment volume was higher due to the inclusion of CF Fertilisers
UK sales.
-
Other segment average selling price per ton decreased due to increased
global nitrogen supply driven by capacity additions coupled with lower
energy and ocean freight costs.
-
Other segment gross margin per ton decreased primarily due to lower
average selling prices which were partially offset by an increase in
unrealized net mark-to-market gains on natural gas derivatives.
Environmental, Health & Safety Performance
As of June 30, 2016, CF Industries' 12-month rolling average recordable
incident rate was 1.06 incidents per 200,000 work-hours.
Dividend Payment
On July 21, 2016, CF Industries’ Board of Directors declared a quarterly
dividend of $0.30 per common share. The dividend will be paid on August
31, 2016 to stockholders of record as of August 15, 2016.
Conference Call
CF Industries will hold a conference call to discuss its second quarter
2016 results at 9:00 a.m. ET on Thursday, August 4, 2016. This
conference call will include discussion of CF Industries' business
environment and outlook. Investors can access the call and find dial-in
information on the Investor Relations section of the company’s website
at www.cfindustries.com.
About CF Industries Holdings, Inc.
CF Industries Holdings, Inc., headquartered in Deerfield, Illinois,
through its subsidiaries is a global leader in the manufacturing and
distribution of nitrogen products, serving both agricultural and
industrial customers. CF Industries operates world-class nitrogen
manufacturing complexes in the central United States, Canada and the
United Kingdom, and distributes plant nutrients through a system of
terminals, warehouses, and associated transportation equipment located
primarily in the Midwestern United States. The company also owns a 50
percent interest in an ammonia facility in The Republic of Trinidad and
Tobago. CF Industries routinely posts investor announcements and
additional information on the company’s website at www.cfindustries.com
and encourages those interested in the company to check there frequently.
Note Regarding Non-GAAP Financial Measures
The company reports its financial results in accordance with U.S.
generally accepted accounting principles (GAAP). Management believes
that EBITDA, adjusted EBITDA, adjusted net earnings, and adjusted net
earnings per diluted share, which are non-GAAP financial measures,
provide additional meaningful information regarding the company's
performance and financial strength. Non-GAAP financial measures should
be viewed in addition to, and not as an alternative for, the company's
reported results prepared in accordance with GAAP. In addition, because
not all companies use identical calculations, EBITDA, adjusted EBITDA,
adjusted net earnings, and adjusted net earnings per diluted share
included in this release may not be comparable to similarly titled
measures of other companies. Reconciliations of EBITDA, adjusted EBITDA,
adjusted net earnings, and adjusted net earnings per diluted share to
the most directly comparable GAAP measures are provided in the tables
accompanying this release under “CF Industries Holdings, Inc.-Selected
Financial Information-Non-GAAP Disclosure Items.”
Safe Harbor Statement
All statements in this communication by CF Industries Holdings, Inc.
(together with its subsidiaries, the “Company”), other than those
relating to historical facts, are forward-looking statements.
Forward-looking statements can generally be identified by their use of
terms such as “anticipate,” “believe,” “could,” “estimate,” “expect,”
“intend,” “may,” “plan,” “predict” or “project” and similar terms and
phrases, including references to assumptions. Forward-looking statements
are not guarantees of future performance and are subject to a number of
assumptions, risks and uncertainties, many of which are beyond the
Company’s control, which could cause actual results to differ materially
from such statements. These statements may include, but are not limited
to, statements about strategic plans and statements about future
financial and operating results.
Important factors that could cause actual results to differ materially
from those in the forward-looking statements include, among others, the
volatility of natural gas prices in North America and Europe; the
cyclical nature of the Company’s business and the agricultural sector;
the global commodity nature of the Company’s fertilizer products, the
impact of global supply and demand on the Company’s selling prices, and
the intense global competition from other fertilizer producers;
conditions in the U.S. and European agricultural industry; difficulties
in securing the supply and delivery of raw materials, increases in their
costs or delays or interruptions in their delivery; reliance on third
party providers of transportation services and equipment; the
significant risks and hazards involved in producing and handling the
Company’s products against which the Company may not be fully insured;
risks associated with cyber security; weather conditions; the Company’s
ability to complete its production capacity expansion projects on
schedule as planned, on budget or at all; risks associated with
expansions of the Company’s business, including unanticipated adverse
consequences and the significant resources that could be required;
potential liabilities and expenditures related to environmental, health
and safety laws and regulations and permitting requirements; future
regulatory restrictions and requirements related to greenhouse gas
emissions; the seasonality of the fertilizer business; the impact of
changing market conditions on the Company’s forward sales programs;
risks involving derivatives and the effectiveness of the Company’s risk
measurement and hedging activities; the Company’s reliance on a limited
number of key facilities; risks associated with the operation or
management of the strategic venture with CHS Inc. (the "CHS Strategic
Venture"); risks and uncertainties relating to the market prices of the
fertilizer products that are the subject of the supply agreement with
CHS Inc. over the life of the supply agreement and the risk that any
challenges related to the CHS Strategic Venture will harm the Company's
other business relationships; risks associated with the Company’s Point
Lisas Nitrogen Limited joint venture; acts of terrorism and regulations
to combat terrorism; risks associated with international operations;
losses on the Company’s investments in securities; deterioration of
global market and economic conditions; and the Company’s ability to
manage its indebtedness.
More detailed information about factors that may affect the Company’s
performance and could cause actual results to differ materially from
those in any forward-looking statements may be found in CF Industries
Holdings, Inc.’s filings with the Securities and Exchange Commission,
including CF Industries Holdings, Inc.’s most recent annual report on
Form 10-K, which is available in the Investor Relations section of the
Company’s web site. Forward-looking statements are given only as of the
date of this communication and the Company disclaims any obligation to
update or revise the forward-looking statements, whether as a result of
new information, future events or otherwise, except as required by law.
|
| |
| |
| CF INDUSTRIES HOLDINGS, INC. |
| SELECTED FINANCIAL INFORMATION |
| CONSOLIDATED STATEMENTS OF OPERATIONS |
| (unaudited) |
| | | |
|
| | Three months ended
June 30, | | Six months ended
June 30, |
| | 2016 |
| 2015 | | 2016 |
| 2015 |
| | (in millions, except per share amounts) |
|
Net sales
| |
$
|
1,134
| | |
$
|
1,311
| | |
$
|
2,138
| | |
$
|
2,265
| |
|
Cost of sales
| |
607
|
| |
625
|
| |
1,394
|
| |
1,163
|
|
|
Gross margin
| |
527
|
| |
686
|
| |
744
|
| |
1,102
|
|
|
Selling, general and administrative expenses
| |
52
| | |
38
| | |
97
| | |
78
| |
|
Transaction costs
| |
165
| | |
—
| | |
179
| | |
—
| |
|
Other operating—net
| |
63
|
| |
23
|
| |
124
|
| |
41
|
|
|
Total other operating costs and expenses
| |
280
| | |
61
| | |
400
| | |
119
| |
|
Equity in (losses) earnings of operating affiliates
| |
(9
|
)
| |
5
|
| |
(9
|
)
| |
14
|
|
|
Operating earnings
| |
238
| | |
630
| | |
335
| | |
997
| |
|
Interest expense
| |
61
| | |
29
| | |
99
| | |
63
| |
|
Interest income
| |
(1
|
)
| |
—
| | |
(2
|
)
| |
(1
|
)
|
|
Other non-operating—net
| |
—
|
| |
—
|
| |
(2
|
)
| |
—
|
|
|
Earnings before income taxes and equity in losses of non-operating
affiliates
| |
178
| | |
601
| | |
240
| | |
935
| |
|
Income tax provision
| |
95
| | |
200
| | |
110
| | |
313
| |
|
Equity in losses of non-operating affiliates—net of taxes
| |
—
|
| |
(36
|
)
| |
—
|
| |
(21
|
)
|
|
Net earnings
| |
83
| | |
365
| | |
130
| | |
601
| |
|
Less: Net earnings attributable to noncontrolling interests
| |
36
|
| |
13
|
| |
57
|
| |
18
|
|
|
Net earnings attributable to common stockholders
| |
$
|
47
|
| |
$
|
352
|
| |
$
|
73
|
| |
$
|
583
|
|
| | | | | | | |
|
|
Net earnings per share attributable to common stockholders:
| | | | | | | | |
|
Basic
| |
$
|
0.20
|
| |
$
|
1.50
|
| |
$
|
0.31
|
| |
$
|
2.45
|
|
|
Diluted
| |
$
|
0.20
|
| |
$
|
1.49
|
| |
$
|
0.31
|
| |
$
|
2.44
|
|
| | | | | | | |
|
|
Weighted-average common shares outstanding:
| | | | | | | | |
|
Basic
| |
233.3
|
| |
235.2
|
| |
233.2
|
| |
237.4
|
|
|
Diluted
| |
233.5
|
| |
236.1
|
| |
233.5
|
| |
238.3
|
|
|
| |
| |
| CF INDUSTRIES HOLDINGS, INC. |
| SELECTED FINANCIAL INFORMATION |
| CONDENSED CONSOLIDATED BALANCE SHEETS |
| | | |
|
| | (unaudited) | | |
| | June 30, | | December 31, |
| | 2016 | | 2015 |
| | (in millions) |
| Assets | | | | |
|
Current assets:
| | | | |
|
Cash and cash equivalents
| |
$
|
2,008
| | |
$
|
286
|
|
Restricted cash
| |
7
| | |
23
|
|
Accounts receivable—net
| |
239
| | |
267
|
|
Inventories
| |
231
| | |
321
|
|
Prepaid income taxes
| |
855
| | |
185
|
|
Other current assets
| |
34
|
| |
45
|
|
Total current assets
| |
3,374
| | |
1,127
|
|
Property, plant and equipment—net
| |
9,413
| | |
8,539
|
|
Investments in affiliates
| |
289
| | |
298
|
| Goodwill | |
2,363
| | |
2,390
|
|
Other assets
| |
323
|
| |
329
|
| Total assets | |
$
|
15,762
|
| |
$
|
12,683
|
| | | |
|
| Liabilities and Equity | | | | |
|
Current liabilities:
| | | | |
|
Accounts payable and accrued expenses
| |
$
|
742
| | |
$
|
918
|
|
Income taxes payable
| |
1
| | |
5
|
|
Customer advances
| |
13
| | |
162
|
|
Other current liabilities
| |
17
|
| |
130
|
|
Total current liabilities
| |
773
|
| |
1,215
|
|
Long-term debt
| |
5,540
| | |
5,537
|
|
Deferred income taxes
| |
1,787
| | |
916
|
|
Other liabilities
| |
497
| | |
628
|
|
Equity:
| | | | |
|
Stockholders' equity
| |
3,984
| | |
4,035
|
|
Noncontrolling interests
| |
3,181
|
| |
352
|
|
Total equity
| |
7,165
|
| |
4,387
|
| Total liabilities and equity | |
$
|
15,762
|
| |
$
|
12,683
|
|
| |
| |
| CF INDUSTRIES HOLDINGS, INC. |
| SELECTED FINANCIAL INFORMATION |
| CONSOLIDATED STATEMENTS OF CASH FLOWS |
| (unaudited) |
| | | |
|
| | Three months ended
June 30, | | Six months ended
June 30, |
| | 2016 |
| 2015 | | 2016 |
| 2015 |
| | (in millions) |
| Operating Activities: | | | | | | | | |
|
Net earnings
| |
$
|
83
| | |
$
|
365
| | |
$
|
130
| | |
$
|
601
| |
|
Adjustments to reconcile net earnings to net cash provided by (used
in) operating activities:
| | | | | | | | |
|
Depreciation and amortization
| |
181
| | |
104
| | |
327
| | |
219
| |
|
Deferred income taxes
| |
839
| | |
(6
|
)
| |
875
| | |
(6
|
)
|
|
Stock-based compensation expense
| |
5
| | |
4
| | |
9
| | |
8
| |
|
Excess tax benefit from stock-based compensation
| |
—
| | |
(1
|
)
| |
—
| | |
(2
|
)
|
|
Unrealized gain on derivatives
| |
(207
|
)
| |
(32
|
)
| |
(189
|
)
| |
(43
|
)
|
|
Loss on sale of equity method investments
| |
—
| | |
43
| | |
—
| | |
43
| |
|
Loss on disposal of property, plant and equipment
| |
1
| | |
8
| | |
4
| | |
14
| |
|
Undistributed losses (earnings) of affiliates—net of taxes
| |
5
| | |
2
| | |
1
| | |
(16
|
)
|
|
Changes in:
| | | | | | | | |
|
Accounts receivable—net
| |
20
| | |
(28
|
)
| |
24
| | |
(4
|
)
|
|
Inventories
| |
65
| | |
60
| | |
81
| | |
(8
|
)
|
|
Accrued and prepaid income taxes
| |
(650
|
)
| |
(54
|
)
| |
(673
|
)
| |
30
| |
|
Accounts payable and accrued expenses
| |
(61
|
)
| |
(22
|
)
| |
(67
|
)
| |
(33
|
)
|
|
Customer advances
| |
(214
|
)
| |
(478
|
)
| |
(149
|
)
| |
(308
|
)
|
|
Other—net
| |
33
|
| |
3
|
| |
73
|
| |
4
|
|
|
Net cash provided by (used in) operating activities
| |
100
|
| |
(32
|
)
| |
446
|
| |
499
|
|
| Investing Activities: | | | | | | | | |
|
Additions to property, plant and equipment
| |
(703
|
)
| |
(587
|
)
| |
(1,379
|
)
| |
(1,032
|
)
|
|
Proceeds from sale of property, plant and equipment
| |
—
| | |
5
| | |
2
| | |
8
| |
|
Proceeds from sale of equity method investment
| |
—
| | |
13
| | |
—
| | |
13
| |
|
Withdrawals from restricted cash funds
| |
5
| | |
9
| | |
16
| | |
32
| |
|
Other—net
| |
2
|
| |
(11
|
)
| |
3
|
| |
(22
|
)
|
|
Net cash used in investing activities
| |
(696
|
)
| |
(571
|
)
| |
(1,358
|
)
| |
(1,001
|
)
|
| Financing Activities: | | | | | | | | |
|
Proceeds from short-term borrowings
| |
—
| | |
—
| | |
150
| | |
—
| |
|
Payments of short-term borrowings
| |
—
| | |
—
| | |
(150
|
)
| |
—
| |
|
Financing fees
| |
(5
|
)
| |
—
| | |
(5
|
)
| |
(2
|
)
|
|
Dividends paid on common stock
| |
(70
|
)
| |
(71
|
)
| |
(140
|
)
| |
(143
|
)
|
|
Issuance of noncontrolling interest in CFN
| |
—
| | |
—
| | |
2,800
| | |
—
| |
|
Distributions to noncontrolling interest
| |
(7
|
)
| |
(10
|
)
| |
(20
|
)
| |
(21
|
)
|
|
Purchases of treasury stock
| |
—
| | |
(287
|
)
| |
—
| | |
(523
|
)
|
|
Issuances of common stock under employee stock plans
| |
—
| | |
1
| | |
—
| | |
7
| |
|
Excess tax benefit from stock-based compensation
| |
—
|
| |
1
|
| |
—
|
| |
2
|
|
|
Net cash (used in) provided by financing activities
| |
(82
|
)
| |
(366
|
)
| |
2,635
|
| |
(680
|
)
|
|
Effect of exchange rate changes on cash and cash equivalents
| |
(3
|
)
| |
—
|
| |
(1
|
)
| |
(5
|
)
|
|
(Decrease) increase in cash and cash equivalents
| |
(681
|
)
| |
(969
|
)
| |
1,722
| | |
(1,187
|
)
|
|
Cash and cash equivalents at beginning of period
| |
2,689
|
| |
1,779
|
| |
286
|
| |
1,997
|
|
|
Cash and cash equivalents at end of period
| |
$
|
2,008
|
| |
$
|
810
|
| |
$
|
2,008
|
| |
$
|
810
|
|
|
|
CF INDUSTRIES HOLDINGS, INC. |
SELECTED FINANCIAL INFORMATION |
NON-GAAP DISCLOSURE ITEMS |
|
|
Reconciliation of net earnings (GAAP measure) to EBITDA and
adjusted EBITDA (non-GAAP measures): |
|
|
|
EBITDA is defined as net earnings attributable to common
stockholders plus interest expense (income)-net, income taxes, and
depreciation and amortization. Other adjustments include the
elimination of loan fee amortization that is included in both
interest and amortization, and the portion of depreciation that is
included in noncontrolling interests. The company has presented
EBITDA because management uses the measure to track performance and
believes that it is frequently used by securities analysts,
investors and other interested parties in the evaluation of
companies in the industry.
|
|
|
|
Adjusted EBITDA is defined as EBITDA adjusted with the selected
items included in EBITDA as summarized in the table below. The
company has presented adjusted EBITDA because management uses
adjusted EBITDA, and believes it is useful to investors, as a
supplemental financial measure in the comparison of year-over-year
performance.
|
|
|
|
| Three months ended
June 30, |
| Six months ended
June 30, |
| | 2016 |
| 2015 | | 2016 |
| 2015 |
| | (in millions) |
|
Net earnings attributable to common stockholders
| |
$
|
47
| | |
$
|
352
| | |
$
|
73
| | |
$
|
583
| |
|
Interest expense (income)—net
| |
60
| | |
29
| | |
97
| | |
62
| |
|
Income taxes(1) | |
95
| | |
189
| | |
110
| | |
302
| |
|
Depreciation and amortization
| |
181
| | |
104
| | |
327
| | |
219
| |
|
Less: other adjustments
| |
(54
|
)
| |
(4
|
)
| |
(71
|
)
| |
(10
|
)
|
|
EBITDA
| |
329
|
| |
670
|
| |
536
|
| |
1,156
|
|
| | | | | | | |
|
|
Unrealized net mark-to-market (gain) loss on natural gas derivatives
| |
(211
|
)
| |
(19
|
)
| |
(190
|
)
| |
(47
|
)
|
|
Transaction costs(2) | |
165
| | |
—
| | |
179
| | |
—
| |
|
Expansion project expenses
| |
19
| | |
12
| | |
35
| | |
21
| |
|
Loss (gain) on foreign currency derivatives
| |
2
| | |
(4
|
)
| |
(1
|
)
| |
19
| |
|
Loss (gain) on foreign currency transactions(3) | |
38
| | |
6
| | |
83
| | |
(14
|
)
|
|
Loss on sale of equity method investments
| |
—
|
| |
43
|
| |
—
|
| |
43
|
|
|
Total adjustments
| |
13
|
| |
38
|
| |
106
|
| |
22
|
|
| | | | | | | |
|
|
Adjusted EBITDA
| |
$
|
342
|
| |
$
|
708
|
| |
$
|
642
|
| |
$
|
1,178
|
|
_______________________________________________________________________________
|
(1)
|
|
Includes the tax benefit of $11 million on loss on sale of
non-operating equity method investment for both the three and six
months ended June 30, 2015.
|
|
(2)
| |
Transaction costs include the $150 million termination fee paid by
CF Holdings to OCI in the second quarter of 2016 as a result of the
termination of the combination agreement with OCI and costs of
various consulting and legal services associated with the company's
proposed combination with certain businesses of OCI and the
company's strategic venture with CHS.
|
|
(3)
| |
Loss (gain) on foreign currency transactions primarily relates to
the unrealized foreign currency exchange rate impact on intercompany
debt that has not been permanently invested.
|
| |
|
Reconciliation of net earnings attributable to common stockholders
(GAAP measure) to adjusted net earnings and adjusted net earnings per
diluted share (non-GAAP measures):
Adjusted net earnings is defined as net earnings attributable to common
stockholders adjusted with the impacts of the selected items included in
net earnings as summarized in the table below. The company has presented
adjusted net earnings and adjusted net earnings per diluted share
because management uses these measures, and believes they are useful to
investors, as supplemental financial measures in the comparison of
year-over-year performance.
|
| |
| |
| | Three months ended
June 30, | | Six months ended
June 30, |
| | 2016 |
| 2015 | | 2016 |
| 2015 |
| | (in millions) |
|
Net earnings attributable to common stockholders
| |
$
|
47
| | |
$
|
352
| | |
$
|
73
| | |
$
|
583
| |
| | | | | | | |
|
|
Unrealized net mark-to-market (gain) loss on natural gas derivatives
| |
(211
|
)
| |
(19
|
)
| |
(190
|
)
| |
(47
|
)
|
|
Transaction costs(1) | |
165
| | |
—
| | |
179
| | |
—
| |
|
Expansion project expenses
| |
19
| | |
12
| | |
35
| | |
21
| |
|
Loss (gain) on foreign currency derivatives
| |
2
| | |
(4
|
)
| |
(1
|
)
| |
19
| |
|
Loss (gain) on foreign currency transactions(2) | |
38
| | |
6
| | |
83
| | |
(14
|
)
|
|
Financing costs related to bridge loan commitment fee(3) | |
28
| | |
—
| | |
28
| | |
—
| |
|
Loss on sale of equity method investments
| |
—
| | |
43
| | |
—
| | |
43
| |
|
Income tax adjustments(4) | |
(11
|
)
| |
(10
|
)
| |
(37
|
)
| |
(5
|
)
|
|
Total adjustments
| |
30
|
| |
28
|
| |
97
|
| |
17
|
|
| | | | | | | |
|
|
Adjusted net earnings
| |
$
|
77
|
| |
$
|
380
|
| |
$
|
170
|
| |
$
|
600
|
|
|
| |
| |
| | Three months ended
June 30, | | Six months ended
June 30, |
| | 2016 |
| 2015 | | 2016 |
| 2015 |
|
Net earnings per diluted share attributable to common stockholders
| |
$
|
0.20
| | |
$
|
1.49
| | |
$
|
0.31
| | |
$
|
2.44
| |
| | | | | | | |
|
|
Unrealized net mark-to-market (gain) loss on natural gas derivatives
| |
(0.90
|
)
| |
(0.08
|
)
| |
(0.81
|
)
| |
(0.20
|
)
|
|
Transaction costs(1) | |
0.71
| | |
—
| | |
0.76
| | |
—
| |
|
Expansion project expenses
| |
0.08
| | |
0.05
| | |
0.15
| | |
0.09
| |
|
Loss (gain) on foreign currency derivatives
| |
0.01
| | |
(0.02
|
)
| |
—
| | |
0.08
| |
|
Loss (gain) on foreign currency transactions(2) | |
0.16
| | |
0.03
| | |
0.35
| | |
(0.06
|
)
|
|
Financing costs related to bridge loan commitment fee(3) | |
0.12
| | |
—
| | |
0.12
| | |
—
| |
|
Loss on sale of equity method investments
| |
—
| | |
0.18
| | |
—
| | |
0.18
| |
|
Income tax adjustments(4) | |
(0.05
|
)
| |
(0.04
|
)
| |
(0.16
|
)
| |
(0.01
|
)
|
|
Total adjustments
| |
0.13
|
| |
0.12
|
| |
0.41
|
| |
0.08
|
|
| | | | | | | |
|
|
Adjusted net earnings per diluted share
| |
$
|
0.33
|
| |
$
|
1.61
|
| |
$
|
0.72
|
| |
$
|
2.52
|
|
_______________________________________________________________________________
(1) |
|
Transaction costs include the $150 million termination fee paid by
CF Holdings to OCI in the second quarter of 2016 as a result of the
termination of the combination agreement with OCI and costs of
various consulting and legal services associated with the company's
proposed combination with certain businesses of OCI and the
company's strategic venture with CHS.
|
(2) | |
Loss (gain) on foreign currency transactions primarily relates to
the unrealized foreign currency exchange rate impact on intercompany
debt that has not been permanently invested.
|
(3) | |
Not included in the calculation of EBITDA.
|
(4) | |
Represents the adjustment to the GAAP basis tax provision reflecting
the tax impact of the other non-GAAP adjustments. The income tax
adjustments for the three and six months ended June 30, 2016 also
include the tax impact of certain transaction costs that were
capitalized in prior tax periods and that are now deductible as a
result of the termination of the combination agreement with OCI.
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20160803006748/en/
CF Industries Holdings, Inc.
Dan Aldridge, Director of Investor
Relations
847-405-2530
daldridge@cfindustries.com
Source: CF Industries Holdings, Inc.