Symbol: POT Listed: TSX, NYSE SASKATOON, SK, July 23
/PRNewswire-FirstCall/ -- Potash Corporation of Saskatchewan Inc.
(PotashCorp) today reported second-quarter earnings of $0.62 per
share1 ($187.1 million) compared to $2.82 per share ($905.1
million) in the same quarter last year. Fertilizer buyers continued
to be extremely cautious in the wake of the global economic
downturn, creating an unprecedented decline in potash and phosphate
sales volumes as well as phosphate and nitrogen prices. In this
environment, second-quarter gross margin fell to $170.6 million -
with approximately two-thirds of that generated by potash -
compared to $1.4 billion in the same period last year. Earnings
before interest, taxes, depreciation and amortization2 of $355.9
million and cash flow prior to working capital changes2 of $304.7
million were also down compared to the same quarter in 2008.
Offshore investments in Arab Potash Company Ltd. (APC) in Jordan,
Sociedad Quimica y Minera de Chile S.A. (SQM) in Chile, Israel
Chemicals Ltd. (ICL) in Israel and Sinofert Holdings Limited
(Sinofert) in China contributed $70.2 million to second-quarter
performance, 25 percent less than in the same period last year as
these companies faced similar challenging conditions. The market
value of our investments in these publicly traded companies was
$6.6 billion as of market close on July 22, 2009, equating to
approximately $22 per PotashCorp share. "The breadth and depth of
the global recession continued to be very difficult to predict, but
our response was not," said PotashCorp President and Chief
Executive Officer Bill Doyle. "We faced the most significant
deferral of demand our industry has ever seen, yet remained
steadfast in our commitment to operate with a long-term view. We
have been and will continue to be a patient company, preparing for
the strong demand that we expect will follow current conditions and
protecting the value of our core assets for the future." Market
Conditions Potash buyers continued to operate conservatively during
the second quarter, carefully managing cash in a tough economy and
waiting for price definition. With dealers and farmers globally
continuing to work through inventories and reducing applications
during the quarter, potash prices moved lower but avoided the
significant declines seen in phosphate and nitrogen. While contract
negotiations continued in India and China, customers in Brazil
began purchasing towards the end of the quarter to replenish
largely depleted inventories in advance of their key planting
season. In North America, estimated potash applications for the
fertilizer year (July 2008 to June 2009) declined by the largest
amount on record, down approximately 40 percent on a year-over-year
basis. Shipments from North American producers fell 73 percent
compared to the same quarter last year and 53 percent for the
fertilizer year, leaving US dealer inventories at very low levels
heading into the fall application season. In phosphate, US producer
solid fertilizer sales to US customers declined 27 percent compared
to the second quarter of 2008. For the fertilizer year, sales
declined 38 percent and application rates were down approximately
30 percent. With strong demand from India and renewed interest in
Brazil near the end of the quarter, offshore sales from US
producers rose 30 percent compared to the same quarter last year.
In nitrogen, US sales volumes and prices declined as a result of
weak industrial demand and liquidation of inventory by customers.
Low natural gas costs made US producers more competitive with their
global counterparts, resulting in reduced imports. Potash Potash
generated gross margin of $106.2 million in the second quarter
versus $886.4 million in the same period last year. This decline
reflected an 86 percent drop in sales volumes, as shipments fell to
0.4 million tonnes from 2.7 million tonnes in the second quarter of
2008. Despite limited product movement, our average realized potash
price for the quarter was 15 percent higher than second-quarter
2008 levels, but 11 percent below the previous quarter. Offshore
realized prices were below those of the trailing quarter as market
pricing recalibrated to lower levels. Prices of most product
shipped by PotashCorp to Canpotex Limited (the offshore marketing
company for Saskatchewan potash producers) in the latter half of
the quarter was adjusted to levels commensurate with those recently
established in the offshore market. Offshore realized prices for
the quarter were also affected by the allocation of transportation
and distribution fixed costs over fewer sales tonnes. As in the
first quarter of 2009, North American realized prices were affected
by the above-normal proportion of industrial volumes relative to
fertilizer. In keeping with our long-held strategy of matching
production to market demand, we took 50 shutdown weeks across our
potash operations in the second quarter, compared with two weeks
taken in the same period last year. As a result, total potash
production of 0.6 million tonnes was 73 percent less than in
second-quarter 2008. In the first half of the year, we took 89
shutdown weeks, reducing our 2009 production potential by nearly 5
million tonnes. Potash per-tonne cost of goods sold in the quarter
was significantly higher quarter over quarter, primarily due to the
allocation of fixed costs over greatly reduced volumes. Phosphate
Second-quarter phosphate gross margin of $20.5 million was 94
percent lower than the $340.9 million generated in the same quarter
last year, due mainly to considerably lower prices for fertilizer
and feed products, plus weak volumes across all product categories.
Strong margin performance from our industrial phosphate business -
where we capitalize on product diversification made possible by
high-quality, lower-cost phosphate rock from our Aurora mine -
generated $41.0 million in gross margin and partially offset
weakness in fertilizer and feed margins. Realized prices for solid,
liquid and feed phosphate products were below second-quarter 2008
levels by 69 percent, 64 percent and 32 percent, respectively. Our
prices for premium industrial products, some of which are sold to
customers under contracts containing cost-plus or market index
provisions that lag current market conditions, rose 13 percent over
the same quarter last year. The per-tonne cost of goods sold in
phosphate declined as prices for sulfur, used in the production of
phosphoric acid, were significantly lower than in second-quarter
2008. The curtailment at our White Springs facility continued
through the second quarter and was primarily responsible for a 26
percent decrease in total phosphate production. Nitrogen Lower
realized prices across all nitrogen product categories resulted in
second-quarter gross margin of $43.9 million, down 79 percent from
the $210.0 million generated in the same period last year. Our
Trinidad operation, which benefits from long-term, lower-cost
natural gas contracts, generated $22.9 million in quarterly gross
margin. Our US operations contributed the remaining $21.0 million.
Our average realized price for nitrogen products of $239 per tonne
was 46 percent lower than in the same quarter last year. Lower gas
prices along with depressed industrial demand resulted in ammonia
and urea prices falling 50 percent and 48 percent, respectively,
quarter over quarter. Nitrogen solutions prices were down 52
percent from the same quarter last year. Total nitrogen sales
volumes were 6 percent lower than in the second quarter of 2008 as
our US operations ran at reduced rates, 80-90 percent of capacity.
Our total average natural gas cost included in production,
including our hedge, was $3.77 per MMBtu, 51 percent lower than in
the same quarter last year. Financial As provided in our previous
guidance, second-quarter results reflect a $132.5 million cash
settlement related to unauthorized investments made in certain
auction-rate securities on our behalf, resulting in a $115.3
million gain from these previously impaired securities, recorded in
other income. In second-quarter 2009, we issued $500.0 million of
senior notes bearing interest of 5.25 percent due May 15, 2014 and
$500.0 million of senior notes bearing interest of 6.50 percent due
May 15, 2019. The net proceeds of this offering were used to repay
outstanding indebtedness under revolving credit facilities and for
general corporate purposes. Selling and administrative expenses
were 33 percent below the same period last year as a result of
lower incentive accruals. Provincial mining tax accruals made
earlier in the year based on higher annual sales volume estimates
were reduced during the second quarter in conjunction with lower
tonnage forecasts. In the second quarter the strengthening Canadian
dollar resulted in the recognition of a foreign-exchange loss of
$37.9 million, more than half of which was a translation loss. We
continued to invest heavily in potash debottlenecking and expansion
projects at five of our facilities, which made up the majority of
the $399.6 million spent on additions to property, plant and
equipment in the quarter. We believe the weak potash market
environment of the past 10 months is unsustainable, and temporary
in nature. With our focus on the long-term need for more potash and
our unique ability to deliver that growth, our commitment to these
projects has not changed. Outlook Given the essential role
fertilizer plays in food production, demand for potash and
phosphate cannot be deferred indefinitely, as removing essential
crop nutrients from the soil today means more must be applied
tomorrow. With rising populations, fundamental shifts in dietary
practices to more meat protein and fruits and vegetables, along
with increasingly limited land and water availability, we
anticipate long-term pressure on the global food system. We believe
that economic uncertainty has resulted in inadequate nutrient
replacement to soils in all major agricultural regions, creating a
void that must be filled. In some regions, nutrients resident in
the soil and exceptional growing conditions can temporarily
distract attention from this underlying issue, but unsustainable
fertilizer practices cannot continue if the world's need for food
is to be met. The imminent need for improved soil fertility around
the world is beginning to bring much-needed clarity to nutrient
markets. Recently announced contracts between major potash
suppliers and India's fertilizer buyers demonstrate customer
understanding of the premium value and very different long-term
supply/demand fundamentals for potash. In contrast to phosphate and
nitrogen realized prices, which have reverted near 2006 levels,
India's recent potash settlements equate to a level nearly triple
our realized offshore prices of three years ago. While these prices
are 26 percent below the record contract prices of last year,
historical and relative context is important: this is one of the
worst economic downturns we have ever seen, and we have just exited
a fertilizer year in which global potash shipments were more than
30 percent lower than the previous year. We believe a return to
normal potash demand - and demand growth - will be driven not only
by the need to replenish soil nutrients but also by renewed
customer confidence in pricing. Fertilizer dealers make money by
buying when they believe they can capture a positive margin, and
many were shaken by the economic downturn and the rapid decline in
phosphate and nitrogen pricing. We have seen India resume potash
purchasing, which we expect will be followed by significant
interest from the large Brazilian market, and we anticipate that
customers worldwide will commit with confidence to new orders and
initiate the lengthy process of refilling the potash pipeline. We
believe this situation could be similar to 2006, when extended
contract negotiations pushed significant potash sales back to the
latter half of the year and, more importantly, were the precursor
to the strong demand rebound in 2007 and 2008. The current
circumstances are even more dramatic because of the extent and
duration of destocking that has occurred. With more than 14 million
tonnes of global potash production curtailed so far this year, we
expect a strong rebound in 2010 potash sales volumes to tighten
supply/demand fundamentals. We anticipate global potash demand in
2010 to be in the range of 55-60 million tonnes, depending on the
pace of improvement in the world economy and related crop commodity
prices. If economic recovery lags and consumers, including those
buying grain and oilseeds, remain cautious, the need to replenish
soil fertility could drive a rebound to the lower end of the range.
If customer confidence and normal buying patterns return, grain
markets could reflect both rising demand and global production
shortfalls due to poor fertility practices during this recession.
Higher crop prices could once again motivate farmers to maximize
production and could drive potash sales volumes to the high end of
that range next year. At this level we believe global producers
would be near operational capacity. We expect that the potash
inventories built by producers during the downturn will supply
immediate needs, but with low inventories in the broader supply
chain, warehouses are expected to empty quickly as demand returns.
We believe meeting longer-term demand growth will present a greater
challenge. Building potash capacity requires considerable cost and
a long time to execute, so sufficiently high potash margins are
necessary to justify the investment. In our view, margins have not
reached a level that justifies the cost of a greenfield mine.
Recently settled contract prices have made this investment even
more challenging. We believe these issues further enhance the
window of opportunity for our expansion projects in Saskatchewan
and New Brunswick, which will be completed in a shorter time frame
and at a significant discount to the estimated cost of a greenfield
mine. These projects are expected to be completed on schedule,
increasing our constructed capacity to 18 million tonnes by the end
of 2012 with a steady ramp-up between now and the end of 2014. We
now expect 2009 potash sales volumes to be in the range of 4.5-5.0
million tonnes. As we have for the past two decades, we will match
our production to demand as it returns market-by-market through the
second half of the year. With our current operational capacity of
approximately 11.5 million tonnes, further production curtailments
above the 4.7 million tonnes already announced this year will be
required. We now anticipate potash gross margin for 2009 to be in
the range of $1.2-$1.5 billion. With lower forecast potash volumes,
we now anticipate our 2009 annual effective tax rate will be in the
range of 14-16 percent, with the remaining quarters at
approximately 23-25 percent. Provincial mining and other taxes are
now forecast within a range of 4-5 percent of total potash gross
margin as a result of lower volumes increasing the impact that our
deductible potash capital expenditures are expected to have on the
profit tax component of these taxes. We now anticipate other income
to be slightly above 2008 levels. PotashCorp is expecting
third-quarter net income per share to be in the range of
$0.80-1.20. For the full year, we anticipate earnings to be in the
range of $4.00-5.00 per share. Conclusion "We have often said that
the demand for our life-giving nutrients does not grow in a
straight line, but we believe the upward trend is undeniable," said
Doyle. "After almost a year of unprecedented global destocking, we
are now beginning to experience the re-emergence of demand in our
key markets. As farmers around the world respond to their noble
calling of feeding the world, we expect this will trigger a
multi-year process of nutrient replenishment, particularly potash.
We will be ready to supply their growing needs and, at the same
time, reward our shareholders." Notes ----- 1. All references to
per-share amounts pertain to diluted net income per share. 2. See
reconciliation and description of non-GAAP measures in the attached
section titled "Selected Non-GAAP Financial Measures and
Reconciliations." Potash Corporation of Saskatchewan Inc. is the
world's largest fertilizer enterprise by capacity producing the
three primary plant nutrients and a leading supplier to three
distinct market categories: agriculture, with the largest capacity
in the world in potash and third largest in phosphate and nitrogen;
animal nutrition, with the world's largest capacity in phosphate
feed ingredients; and industrial chemicals, as the largest global
producer of industrial nitrogen products and the world's largest
capacity for production of purified industrial phosphoric acid.
This release contains forward-looking statements. These statements
are based on certain factors and assumptions including foreign
exchange rates, expected growth, results of operations,
performance, business prospects and opportunities and effective
income tax rates. While the company considers these factors and
assumptions to be reasonable based on information currently
available, they may prove to be incorrect. Several factors could
cause actual results to differ materially from those in the
forward-looking statements, including, but not limited to:
fluctuations in supply and demand in fertilizer, sulfur,
transportation and petrochemical markets; changes in competitive
pressures, including pricing pressures; the current global
financial crisis and conditions and changes in credit markets; the
results of negotiations with China and India; timing and amount of
capital expenditures; risks associated with natural gas and other
hedging activities; changes in capital markets and corresponding
effects on the company's investments; changes in currency and
exchange rates; unexpected geological or environmental conditions,
including water inflow; strikes and other forms of work stoppage or
slowdowns; changes in and the effects of, government policy and
regulations; and earnings, exchange rates and the decisions of
taxing authorities, all of which could affect our effective tax
rates. Additional risks and uncertainties can be found in our Form
10-K for the fiscal year ended December 31, 2008 under captions
"Forward-Looking Statements" and "Item 1A - Risk Factors" and in
our other filings with the US Securities and Exchange Commission
and Canadian provincial securities commissions. Forward-looking
statements are given only as at the date of this release 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.
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PotashCorp will host a conference call on Thursday, July 23, 2009
at 1:00 p.m. Eastern Time. To join the call, dial (412) 317-6578 at
least 10 minutes prior to the start time. No reservation ID is
required. Alternatively, visit http://www.potashcorp.com/ for a
live webcast of the conference call. Webcast participants can
submit questions to management online from their audio player
pop-up window. This news release is also available at our website.
Potash Corporation of Saskatchewan Inc. Condensed Consolidated
Statements of Financial Position (in millions of US dollars except
share amounts) (unaudited) June 30, December 31, 2009 2008
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Assets Current assets Cash and cash equivalents $ 371.3 $ 276.8
Accounts receivable 998.9 1,189.9 Inventories 658.4 714.9 Prepaid
expenses and other current assets 191.9 79.2 Current portion of
derivative instrument assets 0.4 6.4
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2,220.9 2,267.2 Derivative instrument assets 9.9 11.5 Property,
plant and equipment 5,492.7 4,812.2 Investments 3,173.1 2,750.7
Other assets 250.4 288.7 Intangible assets 20.5 21.5 Goodwill 97.0
97.0
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$ 11,264.5 $ 10,248.8
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Liabilities Current liabilities Short-term debt and current portion
of long-term debt $ 735.7 $ 1,324.1 Accounts payable and accrued
charges 590.7 1,183.6 Current portion of derivative instrument
liabilities 84.7 108.1
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1,411.1 2,615.8 Long-term debt (Note 2) 3,082.1 1,739.5 Derivative
instrument liabilities 100.3 120.4 Future income tax liability
769.8 794.2 Accrued pension and other post-retirement benefits
266.0 253.4 Accrued environmental costs and asset retirement
obligations 133.6 133.4 Other non-current liabilities and deferred
credits 2.7 3.2
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5,765.6 5,659.9
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Shareholders' Equity Share capital 1,415.2 1,402.5 Unlimited
authorization of common shares without par value; issued and
outstanding 295,552,385 and 295,200,987 at June 30, 2009 and
December 31, 2008, respectively Contributed surplus 145.8 126.2
Accumulated other comprehensive income 1,099.4 657.9 Retained
earnings 2,838.5 2,402.3
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5,498.9 4,588.9
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$ 11,264.5 $ 10,248.8
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(See Notes to the Condensed Consolidated Financial Statements)
Potash Corporation of Saskatchewan Inc. Condensed Consolidated
Statements of Operations and Retained Earnings (in millions of US
dollars except per-share amounts) (unaudited) Three Months Ended
Six Months Ended June 30 June 30 2009 2008 2009 2008
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Sales (Note 5) $ 856.0 $ 2,621.0 $ 1,778.5 $ 4,511.6 Less: Freight
38.9 103.4 76.5 205.8 Transportation and distribution 37.7 33.3
64.7 65.6 Cost of goods sold 608.8 1,047.0 1,237.1 1,946.9
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Gross Margin 170.6 1,437.3 400.2 2,293.3
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Selling and administrative 53.4 79.7 96.8 126.9 Provincial mining
and other taxes (18.1) 163.0 14.9 262.4 Foreign exchange loss
(gain) 37.9 1.9 7.7 (25.8) Other income (Note 8) (188.4) (103.3)
(223.4) (115.2)
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(115.2) 141.3 (104.0) 248.3
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Operating Income 285.8 1,296.0 504.2 2,045.0 Interest Expense 26.5
15.7 49.7 26.9
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Income Before Income Taxes 259.3 1,280.3 454.5 2,018.1 Income Taxes
(Note 3) 72.2 375.2 (40.9) 547.0
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Net Income $ 187.1 $ 905.1 495.4 1,471.1 ----------------------
---------------------- Retained Earnings, Beginning of Period
2,402.3 2,279.6 Repurchase of Common Shares - (1,981.7) Dividends
(59.2) (62.8)
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Retained Earnings, End of Period $ 2,838.5 $ 1,706.2
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Net Income Per Share (Note 4) Basic $ 0.63 $ 2.91 $ 1.68 $ 4.70
Diluted $ 0.62 $ 2.82 $ 1.63 $ 4.54
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Dividends Per Share $ 0.10 $ 0.10 $ 0.20 $ 0.20
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(See Notes to the Condensed Consolidated Financial Statements)
Potash Corporation of Saskatchewan Inc. Condensed Consolidated
Statements of Cash Flow (in millions of US dollars) (unaudited)
Three Months Ended Six Months Ended June 30 June 30 2009 2008 2009
2008
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Operating Activities Net income $ 187.1 $ 905.1 $ 495.4 $ 1,471.1
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Adjustments to reconcile net income to cash provided by operating
activities Depreciation and amortization 70.1 83.9 144.1 163.8
Stock-based compensation 20.1 25.1 22.6 27.9 Loss (gain) on
disposal of property, plant and equipment 0.9 (6.9) 1.4 (6.8) Gain
on disposal of auction rate securities (115.3) - (115.3) -
Provision for auction rate securities - 0.7 - 43.8 Foreign exchange
on future income tax 11.7 (4.6) (2.1) (9.3) Provision for (recovery
of) future income tax 41.4 47.4 (75.1) 26.8 Undistributed earnings
of equity investees 69.1 (1.1) 31.2 (24.5) Derivative instruments
3.5 (1.9) (41.8) (19.0) Other long-term liabilities 16.1 7.7 27.2
7.1
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Subtotal of adjustments 117.6 150.3 (7.8) 209.8
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Changes in non-cash operating working capital Accounts receivable
54.5 (283.5) 191.9 (494.9) Inventories 0.5 (106.2) 61.1 (229.3)
Prepaid expenses and other current assets (26.8) 0.8 (53.6) (23.4)
Accounts payable and accrued charges (396.6) 228.1 (652.0) 403.6
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Subtotal of changes in non-cash operating working capital (368.4)
(160.8) (452.6) (344.0)
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Cash (used in) provided by operating activities (63.7) 894.6 35.0
1,336.9
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Investing Activities Additions to property, plant and equipment
(399.6) (237.9) (765.7) (434.4) Purchase of long-term investments -
(76.7) - (251.2) Proceeds from disposal of property, plant and
equipment 15.5 9.3 15.8 9.6 Proceeds from disposal of auction rate
securities 132.5 - 132.5 - Other assets and intangible assets 0.7
(17.4) (10.5) (21.4)
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Cash used in investing activities (250.9) (322.7) (627.9) (697.4)
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Cash before financing activities (314.6) 571.9 (592.9) 639.5
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Financing Activities Proceeds from long-term debt obligations
1,795.0 - 2,555.0 - Repayment and finance costs of long-term debt
obligations (1,538.8) (0.2) (2,229.2) (0.2) Proceeds from
short-term debt obligations 196.4 828.9 411.5 842.4 Dividends
(29.0) (30.7) (58.7) (62.5) Repurchase of common shares - (1,476.6)
- (1,897.1) Issuance of common shares 7.2 12.0 8.8 28.3
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Cash provided by (used in) financing activities 430.8 (666.6) 687.4
(1,089.1)
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Increase (Decrease) in Cash and Cash Equivalents 116.2 (94.7) 94.5
(449.6) Cash and Cash Equivalents, Beginning of Period 255.1 364.6
276.8 719.5
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Cash and Cash Equivalents, End of Period $ 371.3 $ 269.9 $ 371.3 $
269.9
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Cash and cash equivalents comprised of: Cash $ 56.1 $ 42.5 $ 56.1 $
42.5 Short-term investments 315.2 227.4 315.2 227.4
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$ 371.3 $ 269.9 $ 371.3 $ 269.9
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Supplemental cash flow disclosure Interest paid $ 30.5 $ 22.8 $
46.0 $ 37.1 Income taxes paid $ 589.0 $ 227.1 $ 736.2 $ 385.6
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(See Notes to the Condensed Consolidated Financial Statements)
Potash Corporation of Saskatchewan Inc. Condensed Consolidated
Statement of Comprehensive Income (in millions of US dollars)
(unaudited) Three Months Ended Six Months Ended June 30 June 30
(Net of related income taxes) 2009 2008 2009 2008
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Net income $ 187.1 $ 905.1 $ 495.4 $ 1,471.1
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Other comprehensive income Net increase in unrealized gains on
available-for- sale securities(1) 363.9 820.6 437.6 969.6 Net gains
(losses) on derivatives designated as cash flow hedges(2) 16.4
154.6 (28.8) 198.7 Reclassification to income of net losses (gains)
on cash flow hedges(3) 16.8 (8.5) 25.4 (14.2) Unrealized foreign
exchange gains on translation of self-sustaining foreign operations
7.4 3.3 7.3 4.9
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Other comprehensive income 404.5 970.0 441.5 1,159.0
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Comprehensive income $ 591.6 $ 1,875.1 $ 936.9 $ 2,630.1
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(1) Available-for-sale securities are comprised of shares in Israel
Chemicals Ltd. and Sinofert Holdings Limited and investments in
auction rate securities. The amounts are net of income taxes of
($0.3) (2008 - $155.8) for the three months ended June 30, 2009 and
$26.5 (2008 - $186.2) for the six months ended June 30, 2009. (2)
Cash flow hedges are comprised of natural gas derivative
instruments, and are net of income taxes of $10.0 (2008 - $62.3)
for the three months ended June 30, 2009 and ($17.5) (2008 - $81.2)
for the six months ended June 30, 2009. (3) Net of income taxes of
$10.1 (2008 - ($3.3)) for the three months ended June 30, 2009 and
$15.4 (2008 - ($5.8)) for the six months ended June 30, 2009.
Potash Corporation of Saskatchewan Inc. Condensed Consolidated
Statement of Accumulated Other Comprehensive Income (in millions of
US dollars) (unaudited) June 30 December 31 (Net of related income
taxes) 2009 2008
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Net unrealized gains on available-for-sale securities(1) $ 1,199.4
$ 761.8 Net unrealized losses on derivatives designated as cash
flow hedges(2) (104.0) (100.6) Unrealized foreign exchange gains
(losses) on translation of self-sustaining foreign operations 4.0
(3.3)
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Accumulated other comprehensive income $ 1,099.4 $ 657.9 Retained
Earnings 2,838.5 2,402.3
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Accumulated Other Comprehensive Income and Retained Earnings $
3,937.9 $ 3,060.2
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(1) $1,349.8 before income taxes (2008 - $885.7). (2) ($165.8)
before income taxes (2008 - $160.2). (See Notes to the Condensed
Consolidated Financial Statements) Potash Corporation of
Saskatchewan Inc. Notes to the Condensed Consolidated Financial
Statements For the Three and Six Months Ended June 30, 2009 (in
millions of US dollars except share and per-share amounts)
(unaudited) 1. Significant Accounting Policies With its
subsidiaries, Potash Corporation of Saskatchewan Inc. ("PCS") -
together known as "PotashCorp" or "the company" except to the
extent the context otherwise requires - forms an integrated
fertilizer and related industrial and feed products company. The
company's accounting policies are in accordance with accounting
principles generally accepted in Canada ("Canadian GAAP"). The
accounting policies used in preparing these unaudited interim
condensed consolidated financial statements are consistent with
those used in the preparation of the 2008 annual consolidated
financial statements, except as described below. These unaudited
interim condensed consolidated financial statements include the
accounts of PCS and its subsidiaries; however, they do not include
all disclosures normally provided in annual consolidated financial
statements and should be read in conjunction with the 2008 annual
consolidated financial statements. In management's opinion, the
unaudited interim condensed consolidated financial statements
include all adjustments (consisting solely of normal recurring
adjustments) necessary to present fairly such information. Interim
results are not necessarily indicative of the results expected for
the fiscal year. Goodwill and Intangible Assets In February 2008,
the Canadian Institute of Chartered Accountants ("CICA") issued
amended accounting standards on goodwill and intangible assets, and
research and development expenditures. The amended standards
provide more specific guidance on the recognition of internally
developed intangible assets, and require that research and
development expenditures be evaluated against the same criteria as
expenditures for intangible assets. The standards substantially
harmonize Canadian standards with International Financial Reporting
Standards ("IFRSs") and apply retrospectively to annual and interim
financial statements relating to fiscal years beginning on or after
October 1, 2008. Also in February 2008, the CICA withdrew and
amended certain standards, which the CICA concluded permitted
deferral of costs that did not meet the definition of an asset. The
amendments apply retrospectively to annual and interim financial
statements relating to fiscal years beginning on or after October
1, 2008. The implementation of these standards, which the company
adopted effective January 1, 2009, did not have a material impact
on the company's consolidated financial statements. 2. Long-Term
Debt On May 1, 2009, the company closed the issuance of $500.0 of
senior notes bearing interest of 5.25 percent due May 15, 2014 and
$500.0 of senior notes bearing interest of 6.50 percent due May 15,
2019. The debt securities were issued under the company's US shelf
registration statement filed on December 12, 2007. The company used
the net proceeds to repay outstanding indebtedness under its
revolving credit facilities and for general corporate purposes.
During the three months ended June 30, 2009, the company received
proceeds from its long-term credit facilities of $795.0, and made
repayments of $1,530.0 under these facilities. During the six
months ended June 30, 2009, the company received proceeds of
$1,555.0 and made repayments of $2,205.0 under these facilities. At
June 30, 2009 amounts outstanding under the credit facilities were
$750.0. 3. Income Taxes The company's income tax provision was
$72.2 for the three months ended June 30, 2009 as compared to
$375.2 for the same period last year. For the six months ended June
30, 2009, the company's income tax provision was a recovery of
$40.9 (2008 - an expense of $547.0). The effective tax rate for the
three and six months ended June 30, 2009 was 28 percent and
negative 9 percent respectively compared to 29 percent and 27
percent for the three and six months ended June 30, 2008. The
provision for the six months ended June 30, 2009 included: - A
future income tax recovery of $119.2 for a tax rate reduction
resulting from an internal restructuring during the first quarter.
- A current income tax recovery of $47.6 recorded in the first
quarter that related to an increase in permanent deductions in the
US from prior years. The recovery will have a positive impact on
cash. - A future income tax provision of $24.4 related to a
second-quarter functional currency election by the parent company
for Canadian income tax purposes. - The benefit of a lower
percentage of consolidated income earned in the higher-tax
jurisdictions. The provision for the six months ended June 30, 2008
included: - The benefit of a scheduled one and a half percentage
point reduction in the Canadian federal income tax rate applicable
to resource companies along with the elimination of the one percent
surtax that became effective at the beginning of the year. - A
future income tax recovery of $42.0 recorded during the first
quarter that related to an increase in permanent deductions in the
US from prior years. - No tax expense on the $25.3 gain recognized
in the first quarter that resulted from the change in fair value of
the forward purchase contract for shares in Sinofert Holdings
Limited ("Sinofert") as the gain was not taxable. 4. Net Income Per
Share Basic net income per share for the quarter is calculated on
the weighted average shares issued and outstanding for the three
months ended June 30, 2009 of 295,443,000 (2008 - 310,615,000).
Basic net income per share for the six months ended June 30, 2009
is calculated on the weighted average shares issued and outstanding
for the period of 295,338,000 (2008 - 313,138,000). Diluted net
income per share is calculated based on the weighted average number
of shares issued and outstanding during the period. The denominator
is: (1) increased by the total of the additional common shares that
would have been issued assuming exercise of all stock options with
exercise prices at or below the average market price for the
period; and (2) decreased by the number of shares that the company
could have repurchased if it had used the assumed proceeds from the
exercise of stock options to repurchase them on the open market at
the average share price for the period. The weighted average number
of shares outstanding for the diluted net income per share
calculation for the three months ended June 30, 2009 was
304,066,000 (2008 - 321,089,000) and for the six months ended June
30, 2009 was 303,736,000 (2008 - 323,716,000). 5. Segment
Information The company has three reportable business segments:
potash, phosphate and nitrogen. These business segments are
differentiated by the chemical nutrient contained in the product
that each produces. Inter-segment sales are made under terms that
approximate market value. The accounting policies of the segments
are the same as those described in Note 1. Three Months Ended June
30, 2009
-------------------------------------------------------------------------
Potash Phosphate Nitrogen All Others Consolidated
-------------------------------------------------------------------------
Sales $ 210.7 $ 324.7 $ 320.6 $ - $ 856.0 Freight 10.6 15.8 12.5 -
38.9 Transportation and distribution 11.6 12.5 13.6 - 37.7 Net
sales - third party 188.5 296.4 294.5 - Cost of goods sold 82.3
275.9 250.6 - 608.8 Gross margin 106.2 20.5 43.9 - 170.6
Depreciation and amortization 5.9 37.9 23.9 2.4 70.1 Inter-segment
sales - - 15.0 - - Three Months Ended June 30, 2008
-------------------------------------------------------------------------
Potash Phosphate Nitrogen All Others Consolidated
-------------------------------------------------------------------------
Sales $1,194.5 $ 782.0 $ 644.5 $ - $2,621.0 Freight 60.3 29.8 13.3
- 103.4 Transportation and distribution 13.9 8.4 11.0 - 33.3 Net
sales - third party 1,120.3 743.8 620.2 - Cost of goods sold 233.9
402.9 410.2 - 1,047.0 Gross margin 886.4 340.9 210.0 - 1,437.3
Depreciation and amortization 24.0 35.7 22.3 1.9 83.9 Inter-segment
sales - 10.5 40.6 - - Six Months Ended June 30, 2009
-------------------------------------------------------------------------
Potash Phosphate Nitrogen All Others Consolidated
-------------------------------------------------------------------------
Sales $ 479.9 $ 654.6 $ 644.0 $ - $1,778.5 Freight 17.3 34.0 25.2 -
76.5 Transportation and distribution 15.2 20.9 28.6 - 64.7 Net
sales - third party 447.4 599.7 590.2 - Cost of goods sold 174.6
570.4 492.1 - 1,237.1 Gross margin 272.8 29.3 98.1 - 400.2
Depreciation and amortization 13.4 76.9 49.2 4.6 144.1
Inter-segment sales - - 20.8 - - Six Months Ended June 30, 2008
-------------------------------------------------------------------------
Potash Phosphate Nitrogen All Others Consolidated
-------------------------------------------------------------------------
Sales $1,990.7 $1,295.2 $1,225.7 $ - $4,511.6 Freight 115.6 61.9
28.3 - 205.8 Transportation and distribution 25.3 16.4 23.9 - 65.6
Net sales - third party 1,849.8 1,216.9 1,173.5 - Cost of goods
sold 448.8 720.0 778.1 - 1,946.9 Gross margin 1,401.0 496.9 395.4 -
2,293.3 Depreciation and amortization 46.8 68.3 44.9 3.8 163.8
Inter-segment sales - 14.7 82.6 - - 6. Stock-Based Compensation On
May 7, 2009, the company's shareholders approved the 2009
Performance Option Plan under which the company may, after February
20, 2009 and before January 1, 2010, issue options to acquire up to
1,000,000 common shares. Under the plan, the exercise price shall
not be less than the quoted market closing price of the company's
common shares on the last trading day immediately preceding the
date of grant and an option's maximum term is 10 years. In general,
options will vest, if at all, according to a schedule based on the
three-year average excess of the company's consolidated cash flow
return on investment over weighted average cost of capital. As of
June 30, 2009, options to purchase a total of 641,400 common shares
have been granted under the plan. The weighted average fair value
of options granted was $42.42 per share, estimated as of the date
of grant using the Black-Scholes-Merton option-pricing model with
the following weighted average assumptions: Expected dividend $0.40
Expected volatility 48% Risk-free interest rate 2.53% Expected life
of options 5.9 years 7. Pension and Other Post-Retirement Expenses
Defined Benefit Pension Plans Three Months Ended Six Months Ended
June 30 June 30 2009 2008 2009 2008
-------------------------------------------------------------------------
Service cost $ 4.3 $ 3.8 $ 8.6 $ 7.6 Interest cost 11.1 10.0 22.2
20.0 Expected return on plan assets (9.6) (12.8) (19.2) (25.8) Net
amortization and change in valuation allowance 7.3 2.9 14.4 5.0
-------------------------------------------------------------------------
Net expense $ 13.1 $ 3.9 $ 26.0 $ 6.8
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Other Post-Retirement Plans Three Months Ended Six Months Ended
June 30 June 30 2009 2008 2009 2008
-------------------------------------------------------------------------
Service cost $ 1.6 $ 1.4 $ 3.1 $ 2.8 Interest cost 4.2 4.0 8.3 8.0
Net amortization 0.2 0.2 0.3 0.3
-------------------------------------------------------------------------
Net expense $ 6.0 $ 5.6 $ 11.7 $ 11.1
-------------------------------------------------------------------------
-------------------------------------------------------------------------
For the three months ended June 30, 2009, the company contributed
$8.5 to its defined benefit pension plans, $3.8 to its defined
contribution pension plans and $2.3 to its other post-retirement
plans. Contributions for the six months ended June 30, 2009 were
$14.2 to its defined benefit pension plans, $12.2 to its defined
contribution pension plans and $4.7 to its other post-retirement
plans. Total 2009 contributions to these plans are not expected to
differ significantly from the amounts previously disclosed in the
consolidated financial statements for the year ended December 31,
2008. 8. Other Income Three Months Ended Six Months Ended June 30
June 30 2009 2008 2009 2008
-------------------------------------------------------------------------
Share of earnings of equity investees $ 29.8 $ 60.3 $ 67.7 $ 83.7
Dividend income 40.4 33.7 40.4 33.7 Gain on disposal of auction
rate securities 115.3 - 115.3 - Other 2.9 10.0 - 16.3 Gain on
forward purchase contract for shares in Sinofert - - - 25.3
Provision for auction rate securities - (0.7) - (43.8)
-------------------------------------------------------------------------
$ 188.4 $ 103.3 $ 223.4 $ 115.2
-------------------------------------------------------------------------
-------------------------------------------------------------------------
In April 2009, the company recognized a gain on the disposal of
auction rate securities of $115.3 due to the settlement of a claim
the company filed in an arbitration proceeding against an
investment firm that purchased auction rate securities with a par
value of $132.5 for the company's account without the company's
authorization. The investment firm paid the company the full par
value of $132.5 in exchange for the transfer of the auction rate
securities to the investment firm. The company retained all
interest paid and accrued on these securities through the date of
the transfer of the securities to the investment firm. The company
was also reimbursed by the investment firm for $3.0 of the
company's legal costs. Prior to the settlement, the company had
recognized in net income a loss of $115.3 related to these
unauthorized securities placed in its account. 9. Comparative
Figures Certain of the prior periods' figures have been
reclassified to conform with the current period's presentation.
Potash Corporation of Saskatchewan Inc. Selected Operating and
Revenue Data (unaudited) Three Months Ended Six Months Ended June
30 June 30 2009 2008 2009 2008
-------------------------------------------------------------------------
Potash Operating Data Production (KCl Tonnes - thousands) 626 2,361
1,666 4,887 Shutdown weeks 49.7 2.0 88.6 2.0 Sales (tonnes -
thousands) Manufactured Product North America 200 1,086 333 2,053
Offshore 194 1,633 535 3,202
-------------------------------------------------------------------------
Manufactured Product 394 2,719 868 5,255
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Potash Net Sales (US $ millions) Sales $210.7 $1,194.5 $479.9
$1,990.7 Less: Freight 10.6 60.3 17.3 115.6 Transportation and
distribution 11.6 13.9 15.2 25.3
-------------------------------------------------------------------------
Net Sales $188.5 $1,120.3 $447.4 $1,849.8
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Manufactured Product North America $115.1 $437.5 $200.5 $729.1
Offshore 71.2 680.8 239.2 1,112.8 Other miscellaneous and purchased
product 2.2 2.0 7.7 7.9
-------------------------------------------------------------------------
Net Sales $188.5 $1,120.3 $447.4 $1,849.8
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Potash Average Price per MT North America $576.29 $403.03 $601.75
$355.12 Offshore $366.70 $416.93 $447.19 $347.56
-------------------------------------------------------------------------
Manufactured Product $473.05 $411.38 $506.54 $350.51
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Potash Corporation of Saskatchewan Inc. Selected Operating and
Revenue Data (unaudited) Three Months Ended Six Months Ended June
30 June 30 2009 2008 2009 2008
-------------------------------------------------------------------------
Phosphate Operating Data Production (P2O5 Tonnes - thousands) 377
507 613 1,037 P2O5 Operating Rate 70% 86% 57% 87% Sales (tonnes -
thousands) Manufactured Product Fertilizer - Liquid phosphates 177
190 273 449 Fertilizer - Solid phosphates 273 370 543 637 Feed 139
183 253 397 Industrial 134 166 250 358
-------------------------------------------------------------------------
Manufactured Product 723 909 1,319 1,841
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Phosphate Net Sales (US $ millions) Sales $324.7 $782.0 $654.6
$1,295.2 Less: Freight 15.8 29.8 34.0 61.9 Transportation and
distribution 12.5 8.4 20.9 16.4
-------------------------------------------------------------------------
Net Sales $296.4 $743.8 $599.7 $1,216.9
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Manufactured Product Fertilizer - Liquid phosphates $43.6 $128.8
$87.7 $223.7 Fertilizer - Solid phosphates 80.3 355.0 172.9 531.3
Feed 72.2 139.9 140.7 235.4 Industrial 96.2 105.2 190.8 196.4 Other
miscellaneous and purchased product 4.1 14.9 7.6 30.1
-------------------------------------------------------------------------
Net Sales $296.4 $743.8 $599.7 $1,216.9
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Phosphate Average Price per MT Fertilizer - Liquid phosphates
$246.54 $679.76 $320.94 $498.44 Fertilizer - Solid phosphates
$294.11 $960.63 $318.29 $834.31 Feed $517.47 $762.31 $556.03
$592.62 Industrial $717.46 $633.50 $763.81 $548.48
-------------------------------------------------------------------------
Manufactured Product $403.96 $802.20 $448.79 $644.67
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Potash Corporation of Saskatchewan Inc. Selected Operating and
Revenue Data (unaudited) Three Months Ended Six Months Ended June
30 June 30 2009 2008 2009 2008
-------------------------------------------------------------------------
Nitrogen Operating Data Production (N Tonnes - thousands) 632 702
1,280 1,422 Average Natural Gas Production Cost per MMBtu $3.77
$7.74 $3.70 $7.23 Sales (tonnes - thousands) Manufactured Product
Ammonia 450 432 929 906 Urea 330 330 725 627 Nitrogen
solutions/Nitric acid/Ammonium nitrate 418 512 804 1,067
-------------------------------------------------------------------------
Manufactured Product 1,198 1,274 2,458 2,600
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Fertilizer sales tonnes 474 499 1,054 938 Industrial/Feed sales
tonnes 724 775 1,404 1,662
-------------------------------------------------------------------------
Manufactured Product 1,198 1,274 2,458 2,600
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Nitrogen Net Sales (US $ millions) Sales $320.6 $644.5 $644.0
$1,225.7 Less: Freight 12.5 13.3 25.2 28.3 Transportation and
distribution 13.6 11.0 28.6 23.9
-------------------------------------------------------------------------
Net Sales $294.5 $620.2 $590.2 $1,173.5
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Manufactured Product Ammonia $123.9 $238.0 $214.8 $478.6 Urea 92.9
177.0 214.5 308.9 Nitrogen solutions/Nitric acid/Ammonium nitrate
69.2 145.6 142.2 276.3 Other miscellaneous and purchased product
8.5 59.6 18.7 109.7
-------------------------------------------------------------------------
Net Sales $294.5 $620.2 $590.2 $1,173.5
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Fertilizer net sales $122.0 $233.5 $266.2 $394.2 Industrial/Feed
net sales 164.0 327.1 305.3 669.6 Other miscellaneous and purchased
product 8.5 59.6 18.7 109.7
-------------------------------------------------------------------------
Net Sales $294.5 $620.2 $590.2 $1,173.5
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Nitrogen Average Price per MT Ammonia $275.07 $551.09 $231.10
$528.24 Urea $281.30 $536.09 $295.89 $492.88 Nitrogen
solutions/Nitric acid/Ammonium nitrate $165.64 $284.38 $177.01
$258.87
-------------------------------------------------------------------------
Manufactured Product $238.67 $440.04 $232.53 $409.15
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Fertilizer average price per MT $257.40 $468.02 $252.62 $420.44
Industrial/Feed average price per MT $226.41 $422.03 $217.45
$402.77
-------------------------------------------------------------------------
Manufactured Product $238.67 $440.04 $232.53 $409.15
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Exchange Rate (Cdn$/US$) 2009 2008
-------------------------------------------------------------------------
December 31 1.2246 June 30 1.1625 1.0186 Second-quarter average
conversion rate 1.2131 1.0051 Potash Corporation of Saskatchewan
Inc. Selected Non-GAAP Financial Measures and Reconciliations (in
millions of US dollars) (unaudited) The following information is
included for convenience only. Generally, a non-GAAP financial
measure is a numerical measure of a company's performance,
financial position or cash flows that either excludes or includes
amounts that are not normally excluded or included in the most
directly comparable measure calculated and presented in accordance
with generally accepted accounting principles ("GAAP"). EBITDA,
adjusted EBITDA, cash flow prior to working capital changes and
free cash flow are not measures of financial performance (nor do
they have standardized meanings) under either Canadian GAAP or US
GAAP. In evaluating these measures, investors should consider that
the methodology applied in calculating such measures may differ
among companies and analysts. The company uses both GAAP and
certain non-GAAP measures to assess performance. The company's
management believes these non-GAAP measures provide useful
supplemental information to investors in order that they may
evaluate PotashCorp's financial performance using the same measures
as management. PotashCorp's management believes that, as a result,
the investor is afforded greater transparency in assessing the
financial performance of the company. These non-GAAP financial
measures should not be considered as a substitute for, nor superior
to, measures of financial performance prepared in accordance with
GAAP. A. EBITDA AND ADJUSTED EBITDA -------------------------- Set
forth below is a reconciliation of "EBITDA" and "adjusted EBITDA"
to net income, the most directly comparable financial measure
calculated and presented in accordance with Canadian GAAP. Three
Months Ended Six Months Ended June 30 June 30 2009 2008 2009 2008
-------------------------------------------------------------------------
Net income $ 187.1 $ 905.1 $ 495.4 $ 1,471.1 Income taxes 72.2
375.2 (40.9) 547.0 Interest expense 26.5 15.7 49.7 26.9
Depreciation and amortization 70.1 83.9 144.1 163.8
-------------------------------------------------------------------------
EBITDA 355.9 1,379.9 648.3 2,208.8 Gain on disposal of auction rate
securities (115.3) - (115.3) - Provision for auction rate
securities - 0.7 - 43.8
-------------------------------------------------------------------------
Adjusted EBITDA $ 240.6 $ 1,380.6 $ 533.0 $ 2,252.6
-------------------------------------------------------------------------
-------------------------------------------------------------------------
EBITDA is calculated as earnings before interest, income taxes,
depreciation and amortization. Adjusted EBITDA is calculated as
earnings before interest, income taxes, depreciation and
amortization, certain gains and losses on disposal of assets, and
impairment charges. PotashCorp uses EBITDA and adjusted EBITDA as
supplemental financial measures of its operational performance.
Management believes EBITDA and adjusted EBITDA to be important
measures as they exclude the effects of items which primarily
reflect the impact of long-term investment decisions, rather than
the performance of the company's day-to-day operations. As compared
to net income according to GAAP, these measures are limited in that
they do not reflect the periodic costs of certain capitalized
tangible and intangible assets used in generating revenues in the
company's business, or the non-cash charges associated with
impairments and certain gains and losses on disposal of assets.
Management evaluates such items through other financial measures
such as capital expenditures and cash flow provided by operating
activities. The company believes that these measurements are useful
to measure a company's ability to service debt and to meet other
payment obligations or as a valuation measurement. Potash
Corporation of Saskatchewan Inc. Selected Non-GAAP Financial
Measures and Reconciliations (in millions of US dollars)
(unaudited) B. CASH FLOW --------- Set forth below is a
reconciliation of "cash flow prior to working capital changes" and
"free cash flow" to cash provided by operating activities, the most
directly comparable financial measure calculated and presented in
accordance with Canadian GAAP. Three Months Ended Six Months Ended
June 30 June 30 2009 2008 2009 2008
-------------------------------------------------------------------------
Cash flow prior to working capital changes(1) $ 304.7 $ 1,055.4 $
487.6 $ 1,680.9
-------------------------------------------------------------------------
Changes in non-cash operating working capital Accounts receivable
54.5 (283.5) 191.9 (494.9) Inventories 0.5 (106.2) 61.1 (229.3)
Prepaid expenses and other current assets (26.8) 0.8 (53.6) (23.4)
Accounts payable and accrued charges (396.6) 228.1 (652.0) 403.6
-------------------------------------------------------------------------
Changes in non-cash operating working capital (368.4) (160.8)
(452.6) (344.0)
-------------------------------------------------------------------------
Cash provided by operating activities $ (63.7) $ 894.6 $ 35.0 $
1,336.9 Additions to property, plant and equipment (399.6) (237.9)
(765.7) (434.4) Other assets and intangible assets 0.7 (17.4)
(10.5) (21.4) Changes in non-cash operating working capital 368.4
160.8 452.6 344.0
-------------------------------------------------------------------------
Free cash flow(2) $ (94.2) $ 800.1 $ (288.6) $ 1,225.1
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(1) The company uses cash flow prior to working capital changes as
a supplemental financial measure in its evaluation of liquidity.
Management believes that adjusting principally for the swings in
non-cash working capital items due to seasonality assists
management in making long-term liquidity assessments. The company
also believes that this measurement is useful as a measure of
liquidity or as a valuation measurement. (2) The company uses free
cash flow as a supplemental financial measure in its evaluation of
liquidity and financial strength. Management believes that
adjusting principally for the swings in non-cash operating working
capital items due to seasonality, additions to property, plant and
equipment, and changes to other assets assists management in the
long-term assessment of liquidity and financial strength. The
company also believes that this measurement is useful as an
indicator of the company's ability to service its debt, meet other
payment obligations and make strategic investments. Readers should
be aware that free cash flow does not represent residual cash flow
available for discretionary expenditures. Certain of the prior
periods' figures have been reclassified to conform with the current
period's presentation. DATASOURCE: Potash Corporation of
Saskatchewan Inc. CONTACT: Investors: Denita Stann, Senior
Director, Investor Relations, Phone: (847) 849-4277, Email: ;
Media: Bill Johnson, Director, Public Affairs, Phone: (306)
933-8849, Email: , Web Site: http://www.potashcorp.com/
Copyright