Financial Performance - In 2025, the company reported a gross margin of $2.72 billion, an increase from $2.06 billion in 2024 and $2.55 billion in 2023 [54]. - The total sales volume for 2025 was 19,057 thousand tons, generating net sales of $7,084 million, compared to 18,943 thousand tons and $5,936 million in 2024 [54]. - CHS was the largest customer in 2025, accounting for approximately 13% of consolidated net sales [78]. Production and Capacity - The production volume for ammonia in 2025 was 10,120 thousand tons, an increase from 9,800 thousand tons in 2024 and 9,496 thousand tons in 2023 [58]. - The company operates eight manufacturing facilities in North America, with a combined production capacity representing approximately 40% of North American ammonia production capacity as of December 31, 2025 [55]. - The Donaldsonville facility has an estimated production capacity of 2.4 million to 3.3 million tons of granular urea and 1.2 million to 4.3 million tons of UAN annually [6]. - The Yazoo City facility's production capacity can reach 450,000 tons of UAN by reducing AN production to 900,000 tons [8]. - The company has a joint venture with Koch Fertilizer LLC at the Point Lisas facility, which has a capacity to produce 720,000 tons of ammonia annually [69]. Strategic Initiatives - The company completed its first sales of low-carbon ammonia in 2025, achieving a premium price compared to traditional ammonia, with expectations for continued demand growth in Europe and Africa [33]. - The Blue Point joint venture, formed in April 2025, involves a 40% ownership by the company, with JERA and Mitsui holding 35% and 25%, respectively, focusing on low-carbon ammonia production [49]. - The company is engaged in discussions for long-term offtake agreements related to low-carbon ammonia, indicating a strategic focus on expanding its market presence [35]. - The company has a long-term ammonia offtake agreement to supply up to 200,000 tons of ammonia per year to IPL's Dyno Nobel, Inc. subsidiary as part of the Waggaman acquisition [48]. Environmental and Regulatory Compliance - Environmental, health, and safety capital expenditures totaled approximately $37 million in 2025, with an estimated $46 million planned for 2026 [86]. - The excess emissions fee under Canadian regulations is CAD $110 per metric ton for 2026, increasing by CAD $15 per metric ton annually, reaching CAD $170 per metric ton by 2030 [90]. - The company is subject to GHG regulations in Canada, the United States, and the United Kingdom, with increasing stringency expected in the coming years [90]. - The company anticipates that more stringent GHG regulations may materially adversely affect its business, financial condition, and results of operations [94]. Workforce and Safety - As of December 31, 2025, the company employed approximately 2,900 employees, with 80% located in the United States, 14% in Canada, and 6% in the United Kingdom [98]. - The company reported a 12-month rolling recordable incident rate (RIR) of 0.26 incidents per 200,000 work hours as of December 31, 2025, with a total recordable injury/illness count of eight for the year [99]. - The company has approximately 5% of its workforce covered by collective bargaining agreements as of December 31, 2025 [98]. - The company is dedicated to creating a workplace culture of inclusion and engagement, investing in recruitment, training, and professional development [96]. Financial Instruments and Costs - The company holds senior notes totaling $3.25 billion in principal outstanding, with maturity dates ranging from March 15, 2034, to March 15, 2044 [447]. - A $1.00 per MMBtu change in the price of natural gas would affect the cost to produce a ton of ammonia by approximately $32 [443]. - As of December 31, 2025, the company had open natural gas derivative contracts covering 13.5 million MMBtus, with a favorable change in fair value of approximately $13 million for a $1.00 per MMBtu increase in prices [445]. - In 2025, natural gas accounted for approximately 34% of the total production costs, with the facilities consuming about 350 million MMBtus of natural gas [70][71]. Facility Operations - The company acquired an ammonia production facility in Waggaman, Louisiana, on December 1, 2023, for a purchase price of $1.675 billion, with a nameplate capacity of 880,000 tons of ammonia annually [48]. - The company plans to permanently close the ammonia plant at the Billingham facility, which had previously been idled since September 2022 [68]. - The company expects production at the Yazoo City facility to resume no earlier than Q4 2026 due to an incident that required temporary idling [66]. Seasonal Business Dynamics - The fertilizer business is seasonal, with the highest demand occurring during the spring planting season and the fall harvest [84].
CF(CF) - 2025 Q4 - Annual Report