The Mosaic Company
(MOS - Free Report
) reported net loss of $431 million or $1.23 per share in the fourth quarter of 2017, against net income of $12 million or 3 cents recorded a year ago.
Earnings, barring one-time items, were 34 cents per share that topped the Zacks Consensus Estimate of 27 cents.
The Minnesota-based company’s revenues rose roughly 10.5% year over year to $2,091.9 million in the quarter. The figure also beat the Zacks Consensus Estimate of $1,886 million. The company gained from higher realized prices across its businesses.
Full-Year 2017 Results
For 2017, the company reported loss of $107 million or 31 cents per share, against a net income of $298 million or 85 cents a year ago. Adjusted earnings for 2017 were $1.09 per share, up 23.9% from 88 cents reported in 2016.
Mosaic reported revenues of $7.4 billion in 2017, up around 2.8% from $7.2 billion in 2016.
The Mosaic Company Price, Consensus and EPS Surprise
Revenues from Mosaic’s Phosphates segment were up 11.6% year over year at $1 billion in the fourth quarter owing to higher average realized sales prices. The segment’s gross margin increased to $133 million from $84 million a year ago, driven by higher realized sales prices and lower phosphate rock costs, partly neutralized by higher ammonia and sulfur costs.
Potash division’s sales rose around 21.9% year over year to $496 million in the quarter, driven by higher average realized sales prices and increased sales volumes. Gross margin in the quarter was $114 million compared with $66 million reported a year ago. The improvement was mainly driven by higher average realized sales prices, partly offset by increased production costs.
Revenues from the International Distribution segment went up around 4.2% year over year to $713 million owing to higher average realized selling prices. Gross margin was $45 million, compared with $59 million reported a year ago.
Mosaic’s cash and cash equivalents amounted to $2,153.5 million as of Dec 31, 2017, surging around 220% year over year.
Total long-term debt rose to $5,221.6 million as of Dec 31, 2017, from $3,818.1 million as of Dec 31, 2016.
Mosaic’s capital expenditures were $230 million in the reported quarter.
Operating cash flow was $411 million in the quarter, up 27.2% from $323 million in the year-ago quarter.
Mosaic expects phosphates sales volumes in the band of 1.9 million to 2.2 million tons for the first quarter of 2018. The segment gross margin is expected to be in the band of $55 to $65 per ton.
Potash sales volumes have been forecast in the range of 1.7-2 million tons for the first quarter and the gross margin is anticipated to be in the band of $50 to $60.
For 2018, the company expects adjusted earnings to be in the range of $1-$1.5 per share. Selling, general & administrative expenses are forecasted to be between $325 million and $350 million for the year. Capital expenditure is anticipated to be in the range of $900-$1,100 million in 2018.
Mosaic’s shares have moved up 28.1% in the last six months, outperforming the 16% growth of its industry
Zacks Rank & Other Stocks to Consider
Mosaic currently sports a Zacks Rank #1 (Strong Buy).
Methanex has an expected long-term earnings growth rate of 15%. Its shares have gained 8.7% over a year.
LyondellBasell has an expected long-term earnings growth rate of 9%. The company’s shares have rallied 14.9% in a year.
Cabot has an expected long-term earnings growth rate of 10%. Its shares have moved up 9.5% over a year.
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