Mosaic's Q4 Earnings and Revenues Fall Short of Estimates

Core Insights - The Mosaic Company reported a significant decline in net income for Q4 2024, with net income at $169 million or 53 cents per share, down from $365.3 million or $1.06 per share in the same quarter last year [1][7] - Adjusted earnings per share were 45 cents, missing the Zacks Consensus Estimate of 53 cents [1][2] - Net sales for the quarter decreased by approximately 10.6% year over year to $2,815.9 million, also missing the Zacks Consensus Estimate of $2,929.4 million [2] Segment Performance - Potash segment net sales were $557 million, down around 26.5% from $758 million in the prior-year quarter, but exceeded the estimate of $518.5 million. Sales volumes were 2.2 million tons, down 15.4% year over year, missing the estimate of 2.3 million tons. The segment's gross margin fell to $55 per ton from $99 per ton [3] - Phosphate division net sales increased by 8.8% to $1,165 million from $1,070 million in the prior-year period, surpassing the estimate of $1,157.8 million. Sales volumes totaled 1.62 million tons, up 2.5% year over year, but lagged behind the estimate of 1.7 million tons. The gross margin decreased to $85 per ton from $88 per ton [4] - Mosaic Fertilizantes segment net sales were approximately $1,088 million, down about 8.7% year over year, but exceeded the estimate of $1,141.3 million. Sales volume rose 3.7% to 2.2 million tons, with a gross margin of $46 per ton, up from $44 per ton in the prior-year quarter [5] Financial Overview - At the end of the quarter, Mosaic had cash and cash equivalents of $273 million, down 21.8% year over year. Long-term debt increased by 3.1% to $3,332.3 million. Net cash provided by operating activities declined nearly 59.2% year over year to $219.3 million [6] - For the full year 2024, Mosaic recorded a net income of $174.9 million or 55 cents per share, down from $1,164.9 million or $3.50 per share a year ago. The company's adjusted EBITDA for the same period was $2.2 billion, with total revenues of $11.1 billion, down 18.9% year over year [7] Market Outlook - The phosphate markets are expected to remain tight due to ongoing supply limitations and rising demand for fertilizers, fuel, and industrial uses. China's phosphate export outlook is positive for the long term, driven by domestic consumption and industrial needs [8] - Potash markets are anticipated to improve in the short to medium term, influenced by output cuts from major producers in Russia, Belarus, and China, along with challenges to planned expansions in Laos. The potential impact of tariffs on Canadian potash exports to the U.S. remains uncertain, but could lead to higher prices and additional costs for U.S. farmers [9] Stock Performance - Shares of Mosaic have declined by 19.5% over the past year, compared to a 6% decline in the industry [10]