| Why PotashCorp’s Potash Shipments May Likely Decline | |
| | |
|
PotashCorp: An Analysis of Its 3Q15 Earnings (Continued from Prior Part) Potash segment shipments
PotashCorp’s (POT) potash segment contributes about 40% towards the company’s revenue and 58% towards the company’s gross margins. This segment experienced a 5% fall in revenue to $603 million from $633 million in 3Q14. To understand why this segment’s revenue fell, we’ll look at potash shipments and potash’s average selling prices.
Total shipments
- The potash segment’s shipments increased to 2.2 million metric tons from 2 million metric tons in 3Q14.
- While potash shipments increased during the year, the company has reduced its full-year guidance.
3Q15 as a whole was a weak quarter for the industry, which is also negative for The Mosaic Company (MOS), CF Industries Holdings (CF), and Intrepid Potash (IPI). This also impacts the Market Vectors Agribusiness ETF (MOO), which holds about 4.3% of PotashCorp as a percentage of its total portfolio.
Outlook
- In the previous quarter, the company was optimistic about global potash shipments, estimating it to be about 60 million tons. However, the company lowered its expectations to 59 million tons for full-year 2015.
- As for the company’s shipments, management lowered its guidance to 9 million tons from 9.5 million for full-year 2015.
- To date, the company has shipped 7 million metric tons, meaning that 4Q15’s shipments will be in the range of 1.9 to 2.4 million metric tons, which would be lower than the 2.5 million metric tons shipped in 4Q14.
- The company plans to shut down production in December, which will reduce production by 500,000 tons. It will have an additional loss of 800,000 tons of production due to the closure of its Penobsquis mine.
- These initiatives indicate a weak environment for potash fertilizer in 4Q15, which will also impact Intrepid Potash (IPI).
The Market Vectors Agribusiness ETF (MOO) will also be negatively impacted. MOO holds about 14% of PotashCorp (POT), Agrium (AGU), The Mosaic Company (MOS), and CF Industries Holdings (CF).
Continue to Next Part Browse this series on Market Realist:
|
|
|
Prb Energy Inc.
|
|
|
CODE : PRB |
|
|
| |
ProfilIndicateurs de MarchéVALEUR : Projets & res.Communiqués de PresseRapport annuelRISQUE : Profile actifsContactez la cie |
Prb Energy est une société développant des projet miniers et de pétrole basée aux Etats-Unis D'Amerique. Prb Energy est cotée aux Etats-Unis D'Amerique et en Allemagne. Sa capitalisation boursière aujourd'hui est 214,4 millions US$ (188,5 millions €). La valeur de son action a atteint son plus bas niveau récent le 25 avril 2008 à 0,10 US$, et son plus haut niveau récent le 28 juin 2019 à 24,58 US$. Prb Energy possède 8 722 000 actions en circulation. |