The Mosaic Company May 6, 2025 First Quarter 2025 Results 1 This presentation includes the presentation and discussion of non-GAAP diluted net earnings per share, or adjusted EPS, non-GAAP gross margin per tonne, or adjusted gross margin per tonne, non-GAAP adjusted EBITDA, non-GAAP cash cost of conversion or production per tonne, or non-GAAP adjusted effective tax rate, collectively referred to as non-GAAP financial measures. Generally, a non-GAAP financial measure is a supplemental numerical measure of a ...

Group 1: Earnings Performance - Mosaic reported quarterly earnings of $0.49 per share, exceeding the Zacks Consensus Estimate of $0.39 per share, but down from $0.65 per share a year ago, representing an earnings surprise of 25.64% [1] - The company posted revenues of $2.62 billion for the quarter, missing the Zacks Consensus Estimate by 1.69% and down from $2.68 billion year-over-year [2] - Over the last four quarters, Mosaic has surpassed consensus EPS estimates only once and has not beaten consensus revenue estimates during the same period [2] Group 2: Stock Performance and Outlook - Mosaic shares have increased approximately 24.5% since the beginning of the year, contrasting with a -3.9% decline in the S&P 500 [3] - The company's earnings outlook is crucial for investors, with current consensus EPS estimates at $0.68 for the coming quarter and $2.20 for the current fiscal year [7] - The Zacks Rank for Mosaic is currently 3 (Hold), indicating expected performance in line with the market in the near future [6] Group 3: Industry Context - The Fertilizers industry, to which Mosaic belongs, is currently ranked in the top 9% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8] - Nutrien, a competitor in the same industry, is expected to report quarterly earnings of $0.33 per share, reflecting a year-over-year decline of 28.3% [9]

Core Viewpoint - Analysts project that Mosaic (MOS) will report quarterly earnings of $0.39 per share, reflecting a 40% decline year over year, with revenues expected to reach $2.67 billion, a decrease of 0.5% from the same quarter last year [1] Earnings Projections - The consensus EPS estimate has been revised 1.2% higher over the last 30 days, indicating a collective reevaluation by analysts [1][2] Revenue Estimates - Analysts estimate 'Net Sales- Phosphates' at $1.15 billion, down 1.7% year over year [4] - 'Net Sales- Mosaic Fertilizantes' is projected to reach $1.02 billion, up 15.4% from the previous year [4] - 'Net Sales- Potash' is expected to be $516.70 million, reflecting a 19.6% decline year over year [4] Sales Volumes - 'Phosphates - Sales volumes - Total Finished Product' is estimated at 1,591.66 KTon, compared to 1,644 KTon a year ago [5] - 'Potash - Sales volumes - Total Finished Product' is projected to be 2,154.66 KTon, slightly down from 2,163 KTon last year [6] - 'Mosaic Fertilizantes - Sales volumes - Total Finished Product' is expected to reach 1,938.02 KTon, up from 1,715 KTon year over year [6] Cost Estimates - 'Phosphates - Realized costs - Blended rock' is projected at $79.75 per Ton, down from $81 per Ton last year [7] - 'Phosphates - Realized costs - Sulfur' is expected to be $156.99 per Ton, compared to $142 per Ton in the same quarter last year [7] - 'Mosaic Fertilizantes - Average finished product selling price (destination)' is estimated at $503.72, down from $517 year over year [8] Price Expectations - 'Phosphates - Average finished product selling price (destination)' is projected at $649.44, compared to $677 in the same quarter last year [9] Stock Performance - Over the past month, shares of Mosaic have returned +30.1%, significantly outperforming the Zacks S&P 500 composite's +0.4% change [9]

Core Viewpoint - The Mosaic Company is expected to report its first-quarter 2025 results on May 6, with anticipated impacts from weak fertilizer prices but potential gains from healthy demand and cost-management actions [1]. Group 1: Earnings Performance - Mosaic has experienced a negative earnings surprise of approximately 17.2% on average over the last four quarters, with a 15.1% negative surprise in the most recent quarter [1]. - The Earnings ESP for Mosaic is +15.82%, with the Zacks Consensus Estimate for the first quarter set at 39 cents [4]. Group 2: Revenue Estimates - The Zacks Consensus Estimate for Mosaic's first-quarter consolidated sales is $2,665.9 million, indicating a decline of 0.5% compared to the same quarter last year [5]. Group 3: Market Conditions - Favorable demand for phosphate and potash is expected to benefit Mosaic, driven by strong agricultural conditions and favorable farmer economics globally [8]. - The demand for grains and oilseeds remains high, supporting the overall fertilizer market [8]. Group 4: Cost Management - Mosaic is implementing cost-reduction strategies aimed at achieving $150 million in run-rate cost reductions by the end of 2025 [9]. - The company is focused on improving its operating cost structure amid a challenging environment [9]. Group 5: Price Trends - Softer fertilizer prices have negatively impacted Mosaic's sales and margins, with phosphate and potash prices declining since mid-2022 [10]. - The average selling price per ton for the Potash segment is estimated at $209, reflecting a year-over-year decline of 29.6%, while the Phosphate unit's average selling price is expected to be $609, indicating a 10% decline from the prior year [11].

Company Overview - Mosaic is headquartered in Tampa and operates in the Basic Materials sector, specifically in fertilizer production [3] - The company's stock has experienced a price change of 23.07% year-to-date [3] Dividend Information - Mosaic currently pays a dividend of $0.22 per share, resulting in a dividend yield of 2.91%, which is higher than the Fertilizers industry's yield of 2.46% and the S&P 500's yield of 1.64% [3] - The annualized dividend of $0.88 represents a 4.8% increase from the previous year [4] - Over the past five years, Mosaic has increased its dividend three times, achieving an average annual increase of 45.27% [4] - The current payout ratio is 42%, indicating that Mosaic pays out 42% of its trailing 12-month earnings per share as dividends [4] Earnings Growth Expectations - For the fiscal year 2025, the Zacks Consensus Estimate for Mosaic's earnings is projected at $2.20 per share, reflecting a year-over-year growth rate of 11.11% [5] Investment Considerations - Dividends are favored by investors as they enhance stock investing profits, reduce overall portfolio risk, and offer tax advantages [6] - Established firms with secure profits are typically viewed as the best dividend options, while high-growth businesses and tech startups rarely offer dividends [7] - Mosaic is considered a compelling investment opportunity due to its strong dividend profile and current Zacks Rank of 3 (Hold) [7]

Core Viewpoint - Mosaic (MOS) is anticipated to report a year-over-year decline in earnings due to lower revenues, with a consensus EPS estimate of $0.39, reflecting a 40% decrease compared to the previous year, and revenues expected to be $2.67 billion, down 0.5% from the same quarter last year [1][3]. Earnings Expectations - The upcoming earnings report is scheduled for May 6, and the stock may rise if the actual results exceed expectations, while a miss could lead to a decline [2]. - The consensus EPS estimate has been revised 1.2% higher in the last 30 days, indicating a slight bullish sentiment among analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model shows a positive Earnings ESP of +15.82% for Mosaic, suggesting a higher likelihood of beating the consensus EPS estimate [10][11]. - A positive Earnings ESP is a strong predictor of an earnings beat, especially when combined with a Zacks Rank of 1, 2, or 3 [8]. Historical Performance - In the last reported quarter, Mosaic was expected to post earnings of $0.53 per share but only achieved $0.45, resulting in a surprise of -15.09% [12]. - Over the past four quarters, Mosaic has only beaten consensus EPS estimates once [13]. Conclusion - While Mosaic is positioned as a potential earnings-beat candidate, other factors should also be considered when evaluating the stock ahead of its earnings release [16].

Core Insights - The article emphasizes the importance of value investing, highlighting the identification of undervalued companies through various valuation metrics [2][9] - The Mosaic Company (MOS) is presented as a strong value stock with a Zacks Rank of 2 (Buy) and an A grade in the Value category [4][9] - Yara International ASA (YARIY) is also noted as a strong value stock with similar metrics and a Zacks Rank of 2 (Buy) [8][9] Company Analysis: The Mosaic Company (MOS) - MOS has a Forward P/E ratio of 12.14, which is lower than the industry average of 13.82 [4] - The stock's P/B ratio is 0.74, significantly below the industry's average P/B of 2.14 [5] - MOS's P/S ratio stands at 0.79, compared to the industry's average P/S of 1.29 [6] - The P/CF ratio for MOS is 6.43, well below the industry's average P/CF of 14.49 [7] Company Analysis: Yara International ASA (YARIY) - YARIY has a P/B ratio of 1.07, which is also below the industry's average P/B of 2.14 [8] - In the past 52 weeks, YARIY's P/B has fluctuated between 0.87 and 1.18, with a median of 1.01 [8] Investment Outlook - Both MOS and YARIY are identified as likely undervalued stocks, supported by their strong earnings outlook and favorable valuation metrics [9]

Core Viewpoint - The Mosaic Company (MOS) has seen a 10.8% increase in its shares over the past three months, outperforming the Zacks Fertilizers industry's 3.9% rise, driven by healthy demand for phosphate and potash, high-return investments, and cost structure improvements [1] Group 1: Demand Factors - There is strong global demand for grains and oilseeds, which is expected to continue driving fertilizer demand due to improved farmer affordability and crop prices [2] - In North America, favorable conditions such as strong yields and the need to replenish soil nutrients are contributing to a positive demand environment for fertilizers [2] - Brazil's fertilizer demand is anticipated to be supported by healthy grower economics and low inventory levels, while India is expected to see increased demand due to pent-up purchases [2] Group 2: Cost Management - The company is implementing cost-reduction strategies aimed at improving its operating cost structure, with a target of achieving $150 million in run-rate cost reductions by the end of 2025 [3] Group 3: Investment and Capacity Expansion - MOS is focused on high-return investments with moderate capital expenditures, including the completion of an 800,000-ton MicroEssentials capacity conversion, which is expected to increase volumes by 25% in 2025 [4] - The Esterhazy Hydrofloat project will add 400,000 tons in milling capacity, expected to be completed by mid-2025, with a ramp-up by the end of the year [4] - A new blending and distribution center in Palmeirante, Brazil, is also set to be completed by mid-2025, projected to increase overall sales by one million tons [4]

Company Overview - Mosaic is headquartered in Tampa and operates in the Basic Materials sector, specifically as a fertilizer maker [3] - The stock has experienced a price change of 11.8% since the beginning of the year [3] Dividend Information - Mosaic currently pays a dividend of $0.22 per share, resulting in a dividend yield of 3.2%, which is higher than the Fertilizers industry's yield of 2.72% and the S&P 500's yield of 1.57% [3] - The annualized dividend of $0.88 has increased by 4.8% from the previous year, with an average annual increase of 47.70% over the last 5 years [4] - The company's current payout ratio is 42%, indicating that it pays out 42% of its trailing 12-month earnings per share as dividends [4] Earnings Growth - The Zacks Consensus Estimate for Mosaic's earnings in 2025 is projected at $2.13 per share, reflecting a year-over-year earnings growth rate of 7.58% [5] Investment Perspective - Mosaic is considered a compelling investment opportunity due to its strong dividend performance and current Zacks Rank of 3 (Hold) [7]

Core Insights - The Mosaic Company Foundation has re-launched as The Mosaic Company Foundation for Sustainable Food Systems, focusing on sustainable agricultural practices in the U.S., India, and Brazil [1][2] - The Foundation aims to support resilient farmers and enhance agricultural self-sufficiency to feed over 9 billion people [2] - The Foundation has invested nearly $50 million in sustainable food systems initiatives [2] U.S. Initiatives - In the U.S., the Foundation emphasizes 4R Nutrient Stewardship, which aims to improve nutrient use efficiency across ten million acres [8] - The Foundation collaborates with organizations like Ducks Unlimited to provide farmers with tools and resources for improving soil health and maximizing yields [4][8] India Initiatives - The Krishi Jyoti program in India has benefited over 760,000 people, resulting in a 35% yield increase for key crops [8] - The Foundation plans to expand its efforts in India, increasing family farm participation in its projects by 15% [3] Brazil Initiatives - In Brazil, family farms involved in The Villages Project have seen yield increases of up to 175%, with half of these farms led by women [8] - The Foundation aims to expand The Villages Project's reach to more smallholder family farmers critical for food security [5] Partnerships and Collaboration - The Foundation collaborates with various partners, including The Nature Conservancy and the S M Sehgal Foundation, to drive innovation and community-driven solutions [2][4] - The partnership with Instituto Mosaic in Brazil focuses on enhancing the impact of sustainable agricultural practices [5]