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May 2, 2024 Source: CF Industries news release NORTHBROOK, Ill.-- CF Industries Holdings, Inc. (NYSE: CF), a leading global manufacturer of hydrogen and nitrogen products, today announced results for the first quarter ended March 31, 2024. Highlights *First quarter net earnings(1)(2) of $194 million, or $1.03 per diluted share, EBITDA(3) of $488 million, and adjusted EBITDA(3) of $459 million *Trailing twelve months net cash from operating activities of $2.26 billion and free cash flow(4) of $1.38 billion *Production outages in the first quarter 2024 due to severe cold and other maintenance events resulted in approximately $75 million higher maintenance expenses than the first quarter of 2023 *Lower ammonia production in the first quarter of 2024 compared to the first quarter of 2023 reduced ammonia available to produce higher-margin upgraded fertilizer products *Executed a joint development agreement with JERA Co., Inc., Japan's largest energy company, to explore development of greenfield low-carbon ammonia production capacity in Louisiana *Commissioning of electrolyzer at Company's Donaldsonville, Louisiana, facility nearing completion, with start-up of green ammonia production to follow *Repurchased 4.3 million shares for $347 million during the first quarter of 2024 "The CF Industries team faced a challenging quarter as severe cold in January and some unplanned maintenance disrupted our network significantly," said Tony Will, president and chief executive officer, CF Industries Holdings, Inc. "However, our team did an outstanding job restoring our operations to normal utilization rates. "Longer-term, we remain confident in our ability to drive strong cash generation due to a global energy cost structure favorable to our North American-based production network and continued progress on our low-carbon clean energy initiatives. As a result, we believe we will be able to continue to create significant shareholder value from disciplined investments in growth opportunities and returning substantial capital to shareholders." Operations Overview The Company continues to operate safely across its network. As of March 31, 2024, the 12-month rolling average recordable incident rate was 0.36 incidents per 200,000 work hours, significantly better than industry averages. Gross ammonia production for the first quarter of 2024 was approximately 2.1 million tons compared to 2.4 million tons in the first quarter of 2023 due to the impact of a significant planned turnaround event in the quarter, severe weather in January that caused or contributed to ammonia plant outages, and other unplanned maintenance. This was partially offset by production in the first quarter of 2024 from the Waggaman ammonia production facility, which was not a part of the Company's network in the first quarter of 2023. The Company incurred approximately $75 million in higher maintenance expenses in the first quarter of 2024 related to plant outages compared to the first quarter of 2023. Following the disruptions to gross ammonia production in the first quarter of 2024, the Company expects gross ammonia production for the full year 2024 to be approximately 9.8 million tons. Financial Results Overview First Quarter 2024 Financial Results For the first quarter of 2024, net earnings attributable to common stockholders were $194 million, or $1.03 per diluted share, EBITDA was $488 million, and adjusted EBITDA was $459 million. These results compare to first quarter of 2023 net earnings attributable to common stockholders of $560 million, or $2.85 per diluted share, EBITDA of $924 million, and adjusted EBITDA of $866 million. Net sales in the first quarter of 2024 were $1.47 billion compared to $2.01 billion in the first quarter of 2023. Average selling prices for the first quarter of 2024 were lower than in the first quarter of 2023 as lower global energy costs reduced the global market clearing price required to meet global demand. Sales volumes in the first quarter of 2024 were similar to the first quarter of 2023 as higher ammonia sales volumes due primarily to the addition of contractual commitments served from the recently acquired Waggaman ammonia production facility were offset primarily by lower urea sales volumes due to the reduced availability of ammonia for upgrade and the impact of severe weather that caused urea plant outages. Cost of sales for the first quarter of 2024 was lower compared to the first quarter of 2023 due to lower realized natural gas costs partially offset by higher maintenance costs. The average cost of natural gas reflected in the Company's cost of sales was $3.19 per MMBtu in the first quarter of 2024 compared to the average cost of natural gas in cost of sales of $6.62 per MMBtu in the first quarter of 2023. Nitrogen Market Outlook Early in the second quarter of 2024, the global nitrogen market moved to a long supply position due to lower-than-expected demand from India and Europe as well as a purchasing pause in North America as unfavorable weather stalled spring field work. In the near-term, management expects global demand to remain resilient, supported by farmer economics and recovering industrial demand, while global nitrogen trade flows adjust for the additional nitrogen supply available for global trade. North America: Management expects nitrogen demand for the first half of 2024 to be positive due to approximately 91 million acres of corn expected to be planted in the United States, good soil moisture throughout the U.S. Midwest supporting higher application rates, and constructive farmer economics. The Company forecasts that nitrogen channel inventories for all products will be below average following the spring application season. To read the entire report click here. Tweet |
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