Nutrien Delivers Excellent First Quarter Results; Expects Strong Spring Season & Raises Annual Guidance

 

 Nutrien Ltd. (TSX and NYSE: NTR) announced today its first-quarter 2021 results, with net earnings of $133 million ($0.22 diluted earnings per share). First-quarter adjusted net earnings 1 were $0.29 per share and adjusted EBITDA 1 was $806 million.

 

"Our earnings and free cash flow 1 results highlight the strength of our integrated business model, execution of strategic initiatives and the recovery in global agricultural markets. Nutrien delivered a record first quarter for Retail and strong fertilizer volumes and margins," commented Mayo Schmidt, Nutrien's President and CEO.

 

"Crop prices and cash margins are at multi-year highs and growers are responding accordingly with increased seeded acreage and a focus on maximizing yields and our team at Nutrien is supporting them at every level. We are delivering the end-to-end services and products they need including our full suite of crop inputs, digital tools and innovative and sustainable solutions that help achieve higher yields. This is a very exciting time for Nutrien, and the team is focused on executing Nutrien's strategy and achieving operational excellence across our business," added Mr. Schmidt.

 

  Highlights:  

 
  • Nutrien generated $476 million in free cash flow in the first quarter of 2021, more than double that of the first quarter in 2020, while adjusted EBITDA increased by nearly 60 percent compared to the first quarter of 2020.
  •  
  • Nutrien Ag Solutions ("Retail") delivered a record $109 million in adjusted EBITDA in the first quarter of 2021, reflecting strong business performance and supportive market conditions across virtually all product categories and key regions where we operate. Retail sales increased 12 percent and gross margin percentage was 22 percent in the first quarter of 2021 compared to 20 percent in the first quarter of 2020 due to strong sales performance, higher gross margin on proprietary products and the benefits of supply chain improvements and strategic procurement. Rolling four quarter Retail adjusted EBITDA to sales exceeded 10 percent and was more than 11 percent in the US.

    Retail also improved its cash operating coverage ratio 1 and lowered its adjusted average working capital 1 by nearly $800 million compared to the first quarter of 2020. Retail adjusted EBITDA per US selling location 1 surpassed $1.1 million and digital platform sales doubled compared to the first quarter of 2020, and accounted for nearly 20 percent of North American sales.
  •  
  • Potash adjusted EBITDA increased 33 percent in the first quarter of 2021 compared to the same period in 2020, due to higher net realized selling prices and sales volumes. Our Potash sales volumes were near record levels for a first quarter due to continued strong demand in North American and offshore markets. Potash cash cost of product manufactured 1 was $57 per tonne in the first quarter of 2021, down $3 per tonne from the same period in 2020, despite headwinds from a stronger Canadian dollar.
  •  
  • Nitrogen adjusted EBITDA increased 27 percent in the first quarter of 2021 compared to the same quarter in 2020 primarily due to higher net realized selling prices. Sales volumes decreased due to lower opening inventories this year after a strong fall application season and reduced production in Trinidad.
  •  
  • In April 2021, Nutrien released its "Feeding the Future Plan" and Environmental, Social and Governance ("ESG") Report which includes aggressive long-term targets and commitments including an at least 30 percent 2 reduction in greenhouse gas emissions (scope 1 and 2) intensity by 2030 and scaling our end-to-end and on-farm Carbon Program. Uptake of our Carbon Program pilot exceeded expectations and we will provide an update on the program and our broader ESG strategy and targets in June 2021.
  •  
  • Nutrien raised full-year 2021 adjusted net earnings per share 1 and adjusted EBITDA 1 guidance to $2.55 to $3.25 per share and $4.4 billion to $4.9 billion, respectively. First-half 2021 guidance is provided at $2.00 to $2.20 adjusted net earnings per share.
  •  

  ______________________________  

 
  
 

1 This financial measure including related guidance, if applicable, is a non-IFRS financial measure. See the "Non-IFRS Financial Measures" section for further information.

 
 

2 From 2018 levels.

 
 

  Management's Discussion and Analysis  

 

The following management's discussion and analysis ("MD&A") is the responsibility of management and is dated as of May 3, 2021. The Board of Directors ("Board") of Nutrien carries out its responsibility for review of this disclosure principally through its audit committee, comprised exclusively of independent directors. The audit committee reviews and, prior to its publication approves this disclosure pursuant to the authority delegated to it by the Board. The term "Nutrien" refers to Nutrien Ltd. and the terms "we", "us", "our", "Nutrien" and "the Company" refer to Nutrien and, as applicable, Nutrien and its direct and indirect subsidiaries on a consolidated basis. Additional information relating to Nutrien (which, except as otherwise noted, is not incorporated by reference herein), including our 2020 Annual Report dated February 18, 2021, which includes our annual audited consolidated financial statements and MD&A and our Annual Information Form, each for the year ended December 31, 2020, can be found on SEDAR at www.sedar.com and on EDGAR at www.sec.gov . No update is provided to the disclosure in our annual MD&A except for material information since the date of our annual MD&A. The Company is a foreign private issuer under the rules and regulations of the US Securities and Exchange Commission ("SEC").

 

  This MD&A is based on the Company's unaudited interim condensed consolidated financial statements as at and for the three months ended March 31, 2021 ("interim financial statements") based on International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board and prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting" unless otherwise noted. This MD&A contains certain non-IFRS financial measures and forward-looking statements which are described in the "Non-IFRS Financial Measures" and the "Forward-Looking Statements" sections, respectively.  

 

  Market Outlook  

 

  Agriculture and Retail  

 
  • Crop prices are at multi-year highs supported by strong global demand and less than expected supply from major production regions.   The rally in crop prices highlights the tightness in global supply and demand balances and the sensitivity to any potential supply risk in 2021. Planting is in full swing across much of North America and we expect US corn and soybean acreage combined could be approximately four million acres above the United States Department of Agriculture's Prospective Plantings report.
  •  
  • We anticipate crop input expenditures will increase more than three percent in key markets where we operate, supported by higher planted acreage and crop prices, as well as, higher crop protection and crop nutrient prices.
  •  
  • We expect record Brazilian crop margins will drive further increases in acreage in the second half of 2021. Safrinha corn planting is complete, but yield potential may be constrained by planting delays and weather which could further tighten the supply and demand balance for corn.
  •  
  • Soil moisture is favorable for Australian winter crop planting and production and growers are expected to increase their spend on all crop inputs due to increased income realized in 2020 and a strong outlook for 2021 crop prices.
  •  

  Crop Nutrient Markets  

 
  • Robust agricultural fundamentals and favorable potash affordability continue to support potash use and prices, particularly for granular product. Given strong demand, we continue to expect record global potash shipments in 2021 of 68 to 70 million tonnes. Strong global demand led to recent potash contracts in India settling at $280 per tonne, which is $33 per tonne higher than the previous contract settled at the end of January.
  •  
  • Global nitrogen prices were supported by strong agriculture fundamentals and a resurgence of industrial demand. Tampa ammonia contract prices have more than doubled since December 2020, as an already tight market was squeezed further by global production outages. US urea and UAN prices have also increased driven by the strong demand for the spring application season, coupled with production outages and slower than normal imports in the first half of the fertilizer year.
  •  
  • We project Chinese urea exports in 2021 will be between 4.0 and 5.5 million tonnes, higher than previously anticipated but lower compared to 5.5 million tonnes in 2020. This is a result of higher expected operating rates, as increased urea prices more than offset elevated feedstock costs.
  •  
  • High crop prices, tight availability and the final rulings on US countervailing duties supported phosphate prices but we anticipate some pressure on historically high production margins going forward due to the significant increase in raw material costs.
  •  

  Financial Outlook and Guidance  

 

Based on market factors detailed above, we are raising full-year 2021 adjusted net earnings guidance to $2.55 to $3.25 per share from $2.05 to $2.75 per share and full-year 2021 adjusted EBITDA guidance to $4.4 to $4.9 billion from $4.0 to $4.5 billion. First-half 2021 guidance is provided at $2.00 to $2.20 adjusted net earnings per share.

 

All guidance numbers, including those noted above are outlined in the tables below. Refer to page 57 of Nutrien's 2020 Annual Report for related assumptions and sensitivities.

 
                                                                                                
 

  2021 Guidance Ranges 1  

 
 

 

 
 

  Low  

 
 

 

 
 

 

 
 

 

 
 

  High  

 
 

 

 
 

Adjusted net earnings per share 2

 
 

$

 
 

2.55

 
 

 

 
 

 

 
 

$

 
 

3.25

 
 

 

 
 

Adjusted EBITDA (billions) 2

 
 

$

 
 

4.4

 
 

 

 
 

 

 
 

$

 
 

4.9

 
 

 

 
 

Retail Adjusted EBITDA (billions)

 
 

$

 
 

1.55

 
 

 

 
 

 

 
 

$

 
 

1.65

 
 

 

 
 

Potash Adjusted EBITDA (billions)

 
 

$

 
 

1.5

 
 

 

 
 

 

 
 

$

 
 

1.7

 
 

 

 
 

Nitrogen Adjusted EBITDA (billions)

 
 

$

 
 

1.3

 
 

 

 
 

 

 
 

$

 
 

1.5

 
 

 

 
 

Phosphate Adjusted EBITDA (millions)

 
 

$

 
 

275

 
 

 

 
 

 

 
 

$

 
 

375

 
 

 

 
 

Potash sales tonnes (millions) 3

 
 

 

 
 

12.5

 
 

 

 
 

 

 
 

 

 
 

13.0

 
 

 

 
 

Nitrogen sales tonnes (millions) 3

 
 

 

 
 

10.9

 
 

 

 
 

 

 
 

 

 
 

11.4

 
 

 

 
 

Depreciation and amortization (billions)

 
 

$

 
 

1.9

 
 

 

 
 

 

 
 

$

 
 

2.0

 
 

 

 
 

Effective tax rate on adjusted earnings

 
 

 

 
 

23

 
 

%

 
 

 

 
 

 

 
 

25

 
 

%

 
 

Sustaining capital expenditures (billions) 2

 
 

$

 
 

1.1

 
 

 

 
 

 

 
 

$

 
 

1.2

 
 

 

 
 
   
 

1 See the "Forward-Looking Statements" section.

 
 

2 See the "Non-IFRS Financial Measures" section.

 
 

3 Manufactured products only. Nitrogen excludes ESN® and Rainbow products.

 
 

  Consolidated Results  

 
                                                                      
 

 

 
 

  Three Months Ended March 31  

 
 

(millions of US dollars)

 
 

  2021  

 
 

 

 
 

2020

 
 

 

 
 

% Change

 
 

Sales 1

 
 

  4,658  

 
 

 

 
 

4,198

 
 

 

 
 

11

 
 

Freight, transportation and distribution

 
 

  211  

 
 

 

 
 

212

 
 

 

 
 

-

 
 

Cost of goods sold

 
 

  3,291  

 
 

 

 
 

3,101

 
 

 

 
 

6

 
 

Gross margin 1

 
 

  1,156  

 
 

 

 
 

885

 
 

 

 
 

31

 
 

Expenses 1

 
 

  878  

 
 

 

 
 

803

 
 

 

 
 

9

 
 

Net earnings (loss)

 
 

  133  

 
 

 

 
 

(35)

 
 

 

 
 

n/m

 
 

Adjusted EBITDA 2

 
 

  806  

 
 

 

 
 

508

 
 

 

 
 

59

 
 

Cash used in operating activities

 
 

  (152)  

 
 

 

 
 

(526)

 
 

 

 
 

71

 
 

Free cash flow ("FCF") 2

 
 

  476  

 
 

 

 
 

181

 
 

 

 
 

163

 
 

FCF including changes in non-cash operating working capital 2

 
 

  (316)  

 
 

 

 
 

(689)

 
 

 

 
 

54

 
 

1 Certain immaterial figures have been reclassified for the three months ended March 31, 2020.

 
 

2 See the "Non-IFRS Financial Measures" section.

 
 

Net earnings and adjusted EBITDA increased significantly in the first quarter of 2021 compared to the same period in 2020 due to strong Nutrien Ag Solutions ("Retail") earnings growth, higher crop nutrient net realized selling prices and higher North American potash sales. Cash flow from operating activities increased in the first quarter of 2021 compared to the first quarter of 2020 helping to generate $476 million in free cash flow, more than double compared to the amount generated in the first quarter of 2020. The COVID-19 pandemic had limited impact on our results during the periods.

 

  Segment Results  

 

Our discussion of segment results set out on the following pages is a comparison of the results for the three months ended March 31, 2021 to the results for the three months ended March 31, 2020, unless otherwise noted.

 

  Nutrien Ag Solutions ("Retail")  

 
                                                                                                                                                                                                                                                                                                                                           
 

 

 
 

  Three Months Ended March 31  

 
 

(millions of US dollars, except

 
 

  Dollars  

 
 

 

 
 

  Gross Margin  

 
 

 

 
 

  Gross Margin (%)  

 
 

as otherwise noted)

 
 

  2021  

 
 

 

 
 

2020

 
 

 

 
 

% Change

 
 

 

 
 

  2021  

 
 

 

 
 

2020

 
 

 

 
 

% Change

 
 

 

 
 

  2021  

 
 

 

 
 

2020

 
 

Sales

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Crop nutrients

 
 

  1,016  

 
 

 

 
 

785

 
 

 

 
 

29

 
 

 

 
 

  220  

 
 

 

 
 

156

 
 

 

 
 

41

 
 

 

 
 

  22  

 
 

 

 
 

20

 
 

Crop protection products

 
 

  1,085  

 
 

 

 
 

1,010

 
 

 

 
 

7

 
 

 

 
 

  176  

 
 

 

 
 

157

 
 

 

 
 

12

 
 

 

 
 

  16  

 
 

 

 
 

16

 
 

Seed

 
 

  463  

 
 

 

 
 

394

 
 

 

 
 

18

 
 

 

 
 

  69  

 
 

 

 
 

59

 
 

 

 
 

17

 
 

 

 
 

  15  

 
 

 

 
 

15

 
 

Merchandise

 
 

  230  

 
 

 

 
 

216

 
 

 

 
 

6

 
 

 

 
 

  38  

 
 

 

 
 

34

 
 

 

 
 

12

 
 

 

 
 

  17  

 
 

 

 
 

16

 
 

Nutrien Financial

 
 

  25  

 
 

 

 
 

16

 
 

 

 
 

56

 
 

 

 
 

  25  

 
 

 

 
 

16

 
 

 

 
 

56

 
 

 

 
 

  100  

 
 

 

 
 

100

 
 

Services and other 1

 
 

  173  

 
 

 

 
 

255

 
 

 

 
 

(32)

 
 

 

 
 

  144  

 
 

 

 
 

134

 
 

 

 
 

7

 
 

 

 
 

  83  

 
 

 

 
 

53

 
 

Nutrien Financial elimination 2

 
 

  (20)  

 
 

 

 
 

(15)

 
 

 

 
 

33

 
 

 

 
 

  (20)  

 
 

 

 
 

(15)

 
 

 

 
 

33

 
 

 

 
 

  100  

 
 

 

 
 

100

 
 

 

 
 

  2,972  

 
 

 

 
 

2,661

 
 

 

 
 

12

 
 

 

 
 

  652  

 
 

 

 
 

541

 
 

 

 
 

21

 
 

 

 
 

  22  

 
 

 

 
 

20

 
 

Cost of goods sold

 
 

  2,320  

 
 

 

 
 

2,120

 
 

 

 
 

9

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Gross margin

 
 

  652  

 
 

 

 
 

541

 
 

 

 
 

21

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Expenses 1,3

 
 

  721  

 
 

 

 
 

689

 
 

 

 
 

5

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Earnings (loss) before finance

 
 
 

costs and taxes ("EBIT")

 
 

  (69)  

 
 

 

 
 

(148)

 
 

 

 
 

(53)

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Depreciation and amortization

 
 

  177  

 
 

 

 
 

155

 
 

 

 
 

14

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

EBITDA

 
 

  108  

 
 

 

 
 

7

 
 

 

 
 

n/m

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Integration and restructuring

 
 
 

related costs

 
 

  1  

 
 

 

 
 

-

 
 

 

 
 

n/m

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Adjusted EBITDA

 
 

  109  

 
 

 

 
 

7

 
 

 

 
 

n/m

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

1 Certain immaterial figures have been reclassified for the three months ended March 31, 2020.

 
 

2 Represents elimination for the interest and service fees charged by Nutrien Financial to Retail branches.

 
 

3 Includes selling expenses of $667 million (2020 – $635 million).

 
 
  •   Adjusted EBITDA increased in the first quarter of 2021 due to higher sales and margins across virtually all product categories and all key regions where we operate. This was supported by strong agricultural market fundamentals, expanded acreage expectations, as well as, supply chain improvements and strategic procurement. Gross margin increased due to strong sales and ongoing efficiency initiatives which also lowered our Retail cash operating coverage ratio 1 to 60 percent from 62 percent.
  •  
  •   Crop nutrients sales increased significantly in the first quarter of 2021 as sales volumes and gross margin per tonne both increased 19 percent. North American sales volumes were up 12 percent, supported by strong spring applications ahead of planting. Gross margin percentage increased in the first quarter of 2021 due to strategic procurement in a rising price environment.
  •  
  •   Crop protection products sales increased in the first quarter of 2021 due to our market growth and favorable application conditions. Gross margin percentage increased by 0.6 percent supported by strong proprietary product results, higher prices, supply chain improvements and the benefit of recent accretive acquisitions in Brazil.
  •  
  •   Seed sales in the first quarter of 2021 increased due to higher grower planting intentions in key regions where we operate, resulting from strong global crop prices and agriculture fundamentals. Gross margin percentage was stable with improved proprietary results offsetting an elevated competitive environment in the US.
  •  
  •   Merchandise sales and gross margin percentage increased in the first quarter of 2021 primarily driven by growth in the US market and strong results in Australia.
  •  
  •   Nutrien Financial sales increased due to higher utilization and adoption of our programs.
  •  
  •   Services and other sales decreased as the divestiture of an Australian livestock export business more than offset much higher North American custom application sales. Despite the change in revenue mix, gross margin increased in Australia and other key markets resulting in a much higher gross margin percentage in the first quarter of 2021.
  •  

  _________________________________  

 
 
 

1 This financial measure including related guidance, if applicable, is a non-IFRS financial measure. See the "Non-IFRS Financial Measures" section for further information.

 
 

  Potash  

 
                                                                                                                                                                                                                           
 

 

 
 

  Three Months Ended March 31  

 
 

(millions of US dollars, except

 
 

  Dollars  

 
 

 

 
 

  Tonnes (thousands)  

 
 

 

 
 

  Average per Tonne  

 
 

as otherwise noted)

 
 

  2021  

 
 

 

 
 

2020

 
 

% Change

 
 

 

 
 

  2021  

 
 

 

 
 

2020

 
 

% Change

 
 

 

 
 

  2021  

 
 

 

 
 

2020

 
 

% Change

 
 

Manufactured product

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Net sales

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

North America

 
 

  332  

 
 

 

 
 

225

 
 

 

 
 

48

 
 

 

 
 

  1,470  

 
 

 

 
 

1,147

 
 

 

 
 

28

 
 

 

 
 

  226  

 
 

 

 
 

196

 
 

 

 
 

15

 
 

Offshore

 
 

  279  

 
 

 

 
 

292

 
 

 

 
 

(4)

 
 

 

 
 

  1,687  

 
 

 

 
 

1,730

 
 

 

 
 

(2)

 
 

 

 
 

  166  

 
 

 

 
 

169

 
 

 

 
 

(2)

 
 

 

 
 

  611  

 
 

 

 
 

517

 
 

 

 
 

18

 
 

 

 
 

  3,157  

 
 

 

 
 

2,877

 
 

 

 
 

10

 
 

 

 
 

  194  

 
 

 

 
 

180

 
 

 

 
 

8

 
 

Cost of goods sold

 
 

  291  

 
 

 

 
 

265

 
 

 

 
 

10

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  92  

 
 

 

 
 

92

 
 

 

 
 

-

 
 

Gross margin - total

 
 

  320  

 
 

 

 
 

252

 
 

 

 
 

27

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  102  

 
 

 

 
 

88

 
 

 

 
 

16

 
 

Expenses 1

 
 

  64  

 
 

 

 
 

63

 
 

 

 
 

2

 
 

 

 
 

Depreciation and amortization

 
 

 

 
 

  39  

 
 

 

 
 

33

 
 

 

 
 

18

 
 

EBIT

 
 

  256  

 
 

 

 
 

189

 
 

 

 
 

35

 
 

 

 
 

Gross margin excluding depreciation

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Depreciation and amortization

 
 

  124  

 
 

 

 
 

96

 
 

 

 
 

29

 
 

 

 
 

and amortization - manufactured 2

 
 

  141  

 
 

 

 
 

121

 
 

 

 
 

17

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Potash cash cost of product

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

EBITDA / Adjusted EBITDA

 
 

  380  

 
 

 

 
 

285

 
 

 

 
 

33

 
 

 

 
 

manufactured 2

 
 

 

 
 

  57  

 
 

 

 
 

60

 
 

 

 
 

(5)

 
 

1 Includes provincial mining taxes of $58 million (2020 – $57 million).

 
 

2 See the "Non-IFRS Financial Measures" section.

 
 
  •   Adjusted EBITDA increased in the first quarter of 2021 due to the combination of stronger demand and higher net realized selling prices, particularly in the North American market, as momentum from the fourth quarter of 2020 carried into the first quarter of 2021. Demand from most offshore spot markets was also very strong and net realized selling prices reflected a significant strengthening in prices from the fourth quarter of 2020. Cost of goods sold per tonne, excluding the impact of depreciation and amortization decreased by $6 per tonne.
  •  
  •   Sales volumes in the first quarter of 2021 increased due to a continuation of exceptionally strong demand in North America and offshore spot markets. The expectation of higher planted acreage in the US, strong crop prices and compelling potash affordability have all supported sales volumes. Offshore sales volumes were slightly lower due to logistics challenges associated with shipping out of the West Coast of Canada due to extremely cold weather in February, which delayed shipment of approximately 300,000 tonnes of committed sales into the rest of 2021.
  •  
  •   Net realized selling price increased as strong demand led to higher prices in North America. Offshore net realized selling prices increased $10 per tonne from the fourth quarter of 2020 but were slightly lower than the first quarter of 2020.
  •  
  •   Cost of goods sold per tonne in the first quarter of 2021 was similar to the same quarter last year primarily due to lower cash production costs offsetting higher depreciation and amortization per tonne associated with production mix. Potash cash cost of product manufactured was $57 per tonne, down from $60 per tonne in the same quarter in 2020, despite the stronger Canadian dollar.
  •  

  Canpotex Sales by Market  

 
                                  
 

 

 
 

  Three Months Ended March 31  

 
 

(percentage of sales volumes, except as otherwise noted)

 
 

  2021  

 
 

2020

 
 

Change

 
 

Other Asian markets 1

 
 

  37  

 
 

29

 
 

8

 
 

Latin America

 
 

  30  

 
 

25

 
 

5

 
 

China

 
 

  15  

 
 

27

 
 

(12)

 
 

Other markets

 
 

  12  

 
 

7

 
 

5

 
 

India

 
 

  6  

 
 

12

 
 

(6)

 
 

 

 
 

  100  

 
 

100

 
 

 

 
 

1 All Asian markets except China and India.

 
 

 

 
 

 

 
 

 

 
 

  Nitrogen  

 
                                                                                                                                                                                                                                                                                                   
 

 

 
 

  Three Months Ended March 31  

 
 

(millions of US dollars, except

 
 

  Dollars  

 
 

 

 
 

  Tonnes (thousands)  

 
 

 

 
 

  Average per Tonne  

 
 

as otherwise noted)

 
 

  2021  

 
 

 

 
 

2020

 
 

% Change

 
 

 

 
 

  2021  

 
 

 

 
 

2020

 
 

% Change

 
 

 

 
 

  2021  

 
 

 

 
 

2020

 
 

% Change

 
 

Manufactured product

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Net sales

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Ammonia

 
 

  160  

 
 

 

 
 

130

 
 

 

 
 

23

 
 

 

 
 

  572  

 
 

 

 
 

567

 
 

 

 
 

1

 
 

 

 
 

  278  

 
 

 

 
 

229

 
 

 

 
 

21

 
 

Urea

 
 

  249  

 
 

 

 
 

237

 
 

 

 
 

5

 
 

 

 
 

  757  

 
 

 

 
 

856

 
 

 

 
 

(12)

 
 

 

 
 

  329  

 
 

 

 
 

277

 
 

 

 
 

19

 
 

Solutions, nitrates and

 

sulfates

 
 

  164  

 
 

 

 
 

163

 
 

 

 
 

1

 
 

 

 
 

  1,074  

 
 

 

 
 

1,105

 
 

 

 
 

(3)

 
 

 

 
 

  153  

 
 

 

 
 

148

 
 

 

 
 

3

 
 

 

 
 

  573  

 
 

 

 
 

530

 
 

 

 
 

8

 
 

 

 
 

  2,403  

 
 

 

 
 

2,528

 
 

 

 
 

(5)

 
 

 

 
 

  238  

 
 

 

 
 

210

 
 

 

 
 

13

 
 

Cost of goods sold

 
 

  440  

 
 

 

 
 

444

 
 

 

 
 

(1)

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  183  

 
 

 

 
 

176

 
 

 

 
 

4

 
 

Gross margin - manufactured

 
 

  133  

 
 

 

 
 

86

 
 

 

 
 

55

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  55  

 
 

 

 
 

34

 
 

 

 
 

62

 
 

Gross margin - other 1

 
 

  17  

 
 

 

 
 

11

 
 

 

 
 

55

 
 

 

 
 

Depreciation and amortization

 
 

 

 
 

  54  

 
 

 

 
 

59

 
 

 

 
 

(8)

 
 

Gross margin - total

 
 

  150  

 
 

 

 
 

97

 
 

 

 
 

55

 
 

 

 
 

Gross margin excluding depreciation

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

(Income) expenses

 
 

  (17)  

 
 

 

 
 

11

 
 

 

 
 

n/m

 
 

 

 
 

and amortization - manufactured

 
 

  109  

 
 

 

 
 

93

 
 

 

 
 

17

 
 

EBIT

 
 

  167  

 
 

 

 
 

86

 
 

 

 
 

94

 
 

 

 
 

Ammonia controllable cash cost of

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Depreciation and amortization

 
 

  129  

 
 

 

 
 

150

 
 

 

 
 

(14)

 
 

 

 
 

product manufactured 2

 
 

 

 
 

  52  

 
 

 

 
 

47

 
 

 

 
 

11

 
 

EBITDA

 
 

  296  

 
 

 

 
 

236

 
 

 

 
 

25

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Impairment of assets

 
 

  4  

 
 

 

 
 

-

 
 

 

 
 

n/m

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Adjusted EBITDA

 
 

  300  

 
 

 

 
 

236

 
 

 

 
 

27

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

1 Includes other nitrogen (including ESN® and Rainbow) and purchased products and is comprised of net sales of $187 million (2020 – $148 million) less cost of goods sold of $170 million (2020 – $137 million).

 
 

2 See the "Non-IFRS Financial Measures" section.

 
 
  •   Adjusted EBITDA increased in the first quarter of 2021 due to higher net realized selling prices and a $30 million benefit in income related to natural gas price arbitrage during the cold weather events in February.
  •  
  •   Sales volumes were slightly lower in the first quarter of 2021 due to reduced production in Trinidad and lower starting inventories in 2021, resulting from the robust fall application season in 2020 compared to 2019. Our ammonia operating rate reached 97 percent in the first quarter of 2021, matching our highest level on record.
  •  
  •   Net realized selling price of nitrogen was higher due to higher benchmark prices resulting from the strength in global agriculture markets and a recovery in industrial nitrogen demand.
  •  
  •   Cost of goods sold per tonne increased as a result of higher natural gas prices, plant outages and a stronger Canadian dollar which more than offset lower depreciation and amortization. These factors also led to a higher ammonia controllable cash cost of product manufactured per tonne in the first quarter of 2021.
  •  

  Natural Gas Prices in Cost of Production  

 
                                            
 

 

 
 

  Three Months Ended March 31  

 
 

(US dollars per MMBtu, except as otherwise noted)

 
 

  2021  

 
 

 

 
 

2020

 
 

 

 
 

% Change

 
 

Overall gas cost excluding realized derivative impact

 
 

  3.17  

 
 

 

 
 

2.24

 
 

 

 
 

42

 
 

Realized derivative impact

 
 

  0.02  

 
 

 

 
 

0.05

 
 

 

 
 

(60)

 
 

Overall gas cost

 
 

  3.19  

 
 

 

 
 

2.29

 
 

 

 
 

39

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Average NYMEX

 
 

  2.69  

 
 

 

 
 

1.95

 
 

 

 
 

38

 
 

Average AECO

 
 

  2.30  

 
 

 

 
 

1.62

 
 

 

 
 

42

 
 
  •   Natural gas prices   in our cost of production increased in the first quarter of 2021 as a result of higher North American gas index prices and increased gas costs in Trinidad, which are linked to ammonia benchmark prices.
  •  

  Phosphate  

 
                                                                                                                                                                                                                                                    
 

 

 
 

  Three Months Ended March 31  

 
 

(millions of US dollars, except

 
 

  Dollars  

 
 

 

 
 

  Tonnes (thousands)  

 
 

 

 
 

  Average per Tonne  

 
 

as otherwise noted)

 
 

  2021  

 
 

 

 
 

2020

 
 

% Change

 
 

 

 
 

  2021  

 
 

 

 
 

2020

 
 

% Change

 
 

 

 
 

  2021  

 
 

 

 
 

2020

 
 

% Change

 
 

Manufactured product

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Net sales

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Fertilizer

 
 

  230  

 
 

 

 
 

173

 
 

 

 
 

33

 
 

 

 
 

  509  

 
 

 

 
 

568

 
 

 

 
 

(10)

 
 

 

 
 

  453  

 
 

 

 
 

305

 
 

 

 
 

49

 
 

Industrial and feed

 
 

  114  

 
 

 

 
 

106

 
 

 

 
 

8

 
 

 

 
 

  193  

 
 

 

 
 

191

 
 

 

 
 

1

 
 

 

 
 

  589  

 
 

 

 
 

556

 
 

 

 
 

6

 
 

 

 
 

  344  

 
 

 

 
 

279

 
 

 

 
 

23

 
 

 

 
 

  702  

 
 

 

 
 

759

 
 

 

 
 

(8)

 
 

 

 
 

  490  

 
 

 

 
 

368

 
 

 

 
 

33

 
 

Cost of goods sold

 
 

  282  

 
 

 

 
 

287

 
 

 

 
 

(2)

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  401  

 
 

 

 
 

379

 
 

 

 
 

6

 
 

Gross margin - manufactured

 
 

  62  

 
 

 

 
 

(8)

 
 

 

 
 

n/m

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  89  

 
 

 

 
 

(11)

 
 

 

 
 

n/m

 
 

Gross margin - other 1

 
 

  4  

 
 

 

 
 

1

 
 

 

 
 

300

 
 

 

 
 

Depreciation and amortization

 
 

 

 
 

  54  

 
 

 

 
 

83

 
 

 

 
 

(35)

 
 

Gross margin - total

 
 

  66  

 
 

 

 
 

(7)

 
 

 

 
 

n/m

 
 

 

 
 

Gross margin excluding depreciation

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Expenses

 
 

  7  

 
 

 

 
 

10

 
 

 

 
 

(30)

 
 

 

 
 

and amortization - manufactured

 
 

  143  

 
 

 

 
 

72

 
 

 

 
 

99

 
 

EBIT

 
 

  59  

 
 

 

 
 

(17)

 
 

 

 
 

n/m

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Depreciation and amortization

 
 

  38  

 
 

 

 
 

63

 
 

 

 
 

(40)

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

EBITDA / Adjusted EBITDA

 
 

  97  

 
 

 

 
 

46

 
 

 

 
 

111

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

1 Includes other phosphate and purchased products and is comprised of net sales of $41 million (2020 - $34 million) less cost of goods sold of $37 million (2020 - $33 million).

 
 
  •   Adjusted EBITDA increased in the first quarter of 2021 due to higher net realized selling prices compared to the first quarter of 2020.
  •  
  •   Sales volumes were slightly lower in the first quarter of 2021 due to the timing of fertilizer shipments.
  •  
  •   Net realized selling price of phosphate fertilizer increased in the first quarter of 2021 in connection with the increase in global benchmark prices. Industrial and feed prices also increased, some of which were based on contract prices that result in a lag in price realization relative to spot prices.
  •  
  •   Cost of goods sold per tonne increased due to significantly higher raw material input costs. This was partially offset by lower depreciation and amortization following the non-cash impairment of assets in the third quarter of 2020.
  •  

  Corporate and Others  

 
                                                                                  
  

  Three Months Ended March 31  

 
 

(millions of US dollars, except as otherwise noted)

 
 

  2021  

 
 

 

 
 

2020

 
 

 

 
 

% Change

 
 

Sales 1

 
 

  -  

 
 

 

 
 

27

 
 

 

 
 

(100)

 
 

Cost of goods sold

 
 

  -  

 
 

 

 
 

25

 
 

 

 
 

(100)

 
 

Gross margin

 
 

  -  

 
 

 

 
 

2

 
 

 

 
 

(100)

 
 

Selling expenses

 
 

  (6)  

 
 

 

 
 

(5)

 
 

 

 
 

20

 
 

General and administrative expenses

 
 

  58  

 
 

 

 
 

60

 
 

 

 
 

(3)

 
 

Share-based compensation expense (recovery)

 
 

  23  

 
 

 

 
 

(32)

 
 

 

 
 

n/m

 
 

Other expenses

 
 

  28  

 
 

 

 
 

7

 
 

 

 
 

300

 
 

EBIT

 
 

  (103)  

 
 

 

 
 

(28)

 
 

 

 
 

268

 
 

Depreciation and amortization

 
 

  12  

 
 

 

 
 

9

 
 

 

 
 

33

 
 

EBITDA

 
 

  (91)  

 
 

 

 
 

(19)

 
 

 

 
 

379

 
 

Adjustments 2

 
 

  43  

 
 

 

 
 

(47)

 
 

 

 
 

n/m

 
 

Adjusted EBITDA

 
 

  (48)  

 
 

 

 
 

(66)

 
 

 

 
 

(27)

 
 

1 Primarily relates to our non-core Canadian business that was sold in 2020.

 
 

2 See Note 2 to the interim financial statements.

 
 
  •   Share-based compensation expense   (recovery) - We had an expense in the first quarter of 2021 due to an increase in our share price, while there was a recovery in the first quarter of 2020 as our share price decreased from market volatility caused by the COVID-19 pandemic.
  •  
  •   Other expenses were higher in the first quarter of 2021 due to a foreign exchange loss related to our Canadian asset retirement obligations compared to a gain in the first quarter of 2020 when the Canadian dollar weakened significantly.
  •  

  Finance Costs, Income Tax Expense (Recovery) and  

 

  Other Comprehensive Income (Loss)  

 
                          
 

 

 
 

  Three Months Ended March 31  

 
 

(millions of US dollars, except as otherwise noted)

 
 

  2021  

 
 

 

 
 

2020

 
 

 

 
 

% Change

 
 

Finance costs

 
 

  120  

 
 

 

 
 

133

 
 

 

 
 

(10)

 
 

Income tax expense (recovery)

 
 

  25  

 
 

 

 
 

(16)

 
 

 

 
 

n/m

 
 

Other comprehensive income (loss)

 
 

  24  

 
 

 

 
 

(358)

 
 

 

 
 

n/m

 
 
  •   Finance costs in the first quarter of 2021 were lower due to lower interest rates and a lower short-term debt balance, more than offsetting a higher long-term debt balance resulting from the $1.5 billion in notes issued in the second quarter of 2020.
  •  
  •   Income tax expense(recovery) – In the first quarter of 2021, there was an income tax expense resulting from earnings, compared to an income tax recovery in the first quarter of 2020 resulting from a loss. The change in the effective tax rate on earnings for the first quarter of 2021 was a result of a change in proportionate earnings (loss) between jurisdictions.
  •  
  •   Other comprehensive income (loss)   For the first quarter of 2021, we had a lower loss on translation of our Retail operations in Australia and Canada as those currencies slightly appreciated relative to the US dollar, compared to large decreases in those currencies relative to the US dollar in the first quarter of 2020 from increased market volatility as a result of the COVID-19 pandemic. In addition, we had a fair value gain from an increase in the share price of our investment in Sinofert Holdings Ltd. in the first quarter of 2021 compared to a fair value loss from a decrease in share price in the first quarter of 2020.
  •  

  Financial Condition Review  

 

The following balance sheet categories contained variances that were considered significant:

 
                                                                                              
 

 

 
 

  As at  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

(millions of US dollars, except as otherwise noted)

 
 

  March 31, 2021  

 
 

 

 
 

December 31, 2020

 
 

 

 
 

$ Change

 
 

 

 
 

% Change

 
 

  Assets  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Cash and cash equivalents

 
 

  712  

 
 

 

 
 

1,454

 
 

 

 
 

(742)

 
 

 

 
 

(51)

 
 

Receivables

 
 

  4,230  

 
 

 

 
 

3,581

 
 

 

 
 

649

 
 

 

 
 

18

 
 

Inventories

 
 

  6,714  

 
 

 

 
 

4,930

 
 

 

 
 

1,784

 
 

 

 
 

36

 
 

Prepaid expenses and other current assets

 
 

  819  

 
 

 

 
 

1,505

 
 

 

 
 

(686)

 
 

 

 
 

(46)

 
 

Property, plant and equipment

 
 

  19,451  

 
 

 

 
 

19,660

 
 

 

 
 

(209)

 
 

 

 
 

(1)

 
 

Other assets

 
 

  678  

 
 

 

 
 

914

 
 

 

 
 

(236)

 
 

 

 
 

(26)

 
 

  Liabilities and Equity  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Payables and accrued charges

 
 

  8,742  

 
 

 

 
 

8,058

 
 

 

 
 

684

 
 

 

 
 

8

 
 

Retained earnings

 
 

  6,471  

 
 

 

 
 

6,606

 
 

 

 
 

(135)

 
 

 

 
 

(2)

 
 
  • Explanations for changes in Cash and cash equivalents are in the "Sources and Uses of Cash" section.
  •  
  •   Receivables increased due to higher sales across all of our segments as a result of higher crop nutrient net realized selling prices and demand for crop inputs. Certain income tax receivables previously classified as non-current are now realizable within one year.
  •  
  •   Inventories increased due to seasonal Retail inventory build-up for the spring planting and application seasons.
  •  
  •   Prepaid expenses and other current assets decreased due to Retail taking delivery of prepaid inventory (primarily seed and crop protection) in preparation for the spring planting and application seasons.
  •  
  •   Property, plant and equipment decreased primarily due to depreciation more than offsetting additions.
  •  
  •   Other assets decreased due to a reclassification of certain income tax receivables as current receivables, which will be realized within one year.
  •  
  •   Payables and accrued charges increased due to higher customer prepayments in North America driven by strong crop demand and prices.
  •  
  •   Retained earnings decreased due to dividends declared exceeding net earnings.
  •  

  Liquidity and Capital Resources  

 

  Sources and Uses of Liquidity  

 

  We continued to manage our capital in accordance with our capital allocation strategy. We believe that our internally generated cash flow, supplemented by available borrowings under our existing financing sources, if necessary, will be sufficient to meet our anticipated capital expenditures and other cash requirements for the foreseeable future. As further developments and impacts of the COVID-19 pandemic continue to be highly uncertain and cannot be predicted, we continue to monitor our liquidity position. Refer to the "Capital Structure and Management" section for details on our existing long-term debt and credit facilities.  

 

  Key uses and sources of cash and cash equivalents in the first quarter of 2021 included:

 
  • Investments in capital assets to sustain and grow our safe, reliable and cost-efficient operations. Cash additions to property, plant and equipment and intangible assets were $325 million and $33 million, respectively.
  •  
  • Returns to our shareholders through dividends and share repurchases (See Note 7 to the interim financial statements). Dividends paid were $255 million and share repurchases were $1 million.
  •  

  Sources and Uses of Cash  

 
                                      
 

 

 
 

  Three Months Ended March 31  

 
 

(millions of US dollars, except as otherwise noted)

 
 

  2021  

 
 

 

 
 

2020

 
 

 

 
 

% Change

 
 

Cash used in operating activities

 
 

  (152)  

 
 

 

 
 

(526)

 
 

 

 
 

(71)

 
 

Cash used in investing activities

 
 

  (388)  

 
 

 

 
 

(445)

 
 

 

 
 

(13)

 
 

Cash (used in) provided by financing activities

 
 

  (191)  

 
 

 

 
 

3,519

 
 

 

 
 

n/m

 
 

Effect of exchange rate changes on cash and cash

 

equivalents

 
 

  (11)  

 
 

 

 
 

(37)

 
 

 

 
 

(70)

 
 

(Decrease) increase in cash and cash equivalents

 
 

  (742)  

 
 

 

 
 

2,511

 
 

 

 
 

n/m

 
 

  Cash and cash equivalents decreased by $742 million in the first quarter of 2021 compared to an increase of $2,511 million in the first quarter of 2020 due to:

 
  • A decrease of $4.4 billion in short-term net debt borrowings as we managed liquidity needs in the first quarter of 2020 as a result of market volatility during the initial period of the COVID-19 pandemic.
  •  

The above factor was partially offset by:

 
  • Lower cash used in our operating activities due to the recovery in global agriculture markets, which resulted in higher crop nutrient and net realized selling prices and strong sales volumes,
  •  
  • The receipt of a significant amount of customer prepayments in the first quarter of 2021 and improvements to our working capital management, and
  •  
  • A decrease of $501 million in long-term debt repayments.
  •  

  Capital Structure and Management  

 

  Principal Debt Instruments  

 

We continue to closely monitor our liquidity position. We use a combination of cash generated from operations and short-term and long-term debt to finance our operations. We were in compliance with our debt covenants and did not have any changes to our credit ratings in the three months ended March 31, 2021.

 
                                          
 

 

 
 

  As at March 31, 2021  

 
 

 

 
 

 

 
 

 

 
 

  Outstanding and Committed  

 
 

(millions of US dollars)

 
 

Rate of Interest (%)

 
 

Total Facility Limit

 
 

  Short-term debt  

 
 

  Long-term debt  

 
 

Credit facilities

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Unsecured revolving term credit facility

 
 

n/a

 
 

4,500

 
 

  -  

 
 

  -  

 
 

Uncommitted revolving demand facility

 
 

n/a

 
 

500

 
 

  -  

 
 

  -  

 
 

Other credit facilities 1

 
 

0.8 - 8.3

 
 

810

 
 

  252  

 
 

  63  

 
 

Commercial paper

 
 

n/a

 
 

 

 
 

  -  

 
 

  -  

 
 

Total

 
 

 

 
 

 

 
 

  252  

 
 

  63  

 
 

1 Other credit facilities are unsecured and consist of South American facilities with debt of $135 million and interest rates ranging from 1.4 percent to 8.3 percent, Australian facilities with debt of $131 million and an interest rate of 0.8 percent, and other facilities with debt of $49 million and interest rates ranging from 1.8 percent to 4.1 percent.

 
 

The amount available under the commercial paper program is limited to the availability of backup funds under the $4,500 million unsecured revolving term credit facility and excess cash invested in highly liquid securities.

 

Our long-term debt consists primarily of notes. See the "Capital Structure and Management" section of our 2020 Annual Report for information on balances, rates and maturities for our notes.

 

  Outstanding Share Data  

 
      
 

 

 
 

  As at April 30, 2021  

 
 

Common shares

 
 

  570,208,107  

 
 

Options to purchase common shares

 
 

  11,156,972  

 
 

For more information on our capital structure and management, see Note 24 to our 2020 financial statements.

 

  Quarterly Results  

 
                                                                                                          
 

(millions of US dollars, except as otherwise noted)

 
 

  Q1 2021  

 
 

Q4 2020

 
 

Q3 2020

 
 

Q2 2020

 
 

Q1 2020

 
 

Q4 2019

 
 

Q3 2019

 
 

Q2 2019

 
 

Sales 1

 
 

  4,658  

 
 

 

 
 

4,052

 
 

 

 
 

4,227

 
 

 

 
 

8,431

 
 

 

 
 

4,198

 
 

 

 
 

3,462

 
 

 

 
 

4,185

 
 

 

 
 

8,704

 
 

Net earnings (loss) attributable to equity holders

 

of Nutrien

 
 

  127  

 
 

 

 
 

316

 
 

 

 
 

(587)

 
 

 

 
 

765

 
 

 

 
 

(35)

 
 

 

 
 

(48)

 
 

 

 
 

141

 
 

 

 
 

858

 
 

Adjusted EBITDA

 
 

  806  

 
 

 

 
 

768

 
 

 

 
 

670

 
 

 

 
 

1,721

 
 

 

 
 

508

 
 

 

 
 

664

 
 

 

 
 

787

 
 

 

 
 

1,870

 
 

Net earnings (loss) per share attributable to

 

equity holders of Nutrien

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Basic

 
 

  0.22  

 
 

 

 
 

0.55

 
 

 

 
 

(1.03)

 
 

 

 
 

1.34

 
 

 

 
 

(0.06)

 
 

 

 
 

(0.08)

 
 

 

 
 

0.25

 
 

 

 
 

1.48

 
 

Diluted

 
 

  0.22  

 
 

 

 
 

0.55

 
 

 

 
 

(1.03)

 
 

 

 
 

1.34

 
 

 

 
 

(0.06)

 
 

 

 
 

(0.08)

 
 

 

 
 

0.24

 
 

 

 
 

1.47

 
 

1 Certain immaterial figures have been reclassified in the first three quarters of 2020.

 
 

Seasonality in our business results from increased demand for products during the planting season. Crop input sales are generally higher in the spring and fall application seasons. Crop nutrient inventories are normally accumulated leading up to each application season. Our cash collections generally occur after the application season is complete, while customer prepayments made to us are concentrated in December and January and inventory prepayments paid to our vendors are typically concentrated in the period from November to January. Feed and industrial sales are more evenly distributed throughout the year.

 

Since the fourth quarter of 2019, and up to the fourth quarter of 2020, Potash earnings were impacted by lower net realized selling prices caused by a temporary slowdown in global demand. In the third quarter of 2020, earnings were impacted by non-cash impairments of property, plant and equipment primarily in the Phosphate segment as a result of lower forecasted global phosphate prices. In the fourth quarter of 2020, earnings were impacted by a net gain on disposal of our investment in Misr Fertilizers Production Company S.A.E. ("MOPCO").

 

  Critical Accounting Estimates  

 

Our critical accounting policies are disclosed in our 2020 Annual Report. We have discussed the development, selection and application of our key accounting policies, and the critical accounting estimates and assumptions they involve, with the audit committee of the Board. Our critical accounting estimates are discussed on page 53 of our 2020 Annual Report. There were no significant changes in the first three months of 2021.

 

  Controls and Procedures  

 

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934, as amended, and National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings . Internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and preparation of financial statements for external purposes in accordance with IFRS. Any system of internal control over financial reporting, no matter how well designed, has inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

 

There has been no change in our internal control over financial reporting during the three months ended March 31, 2021 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

  Forward-Looking Statements  

 

Certain statements and other information included in this document, including within the "Financial Outlook and Guidance" section, constitute "forward-looking information" or "forward-looking statements" (collectively, "forward-looking statements") under applicable securities laws (such statements are often accompanied by words such as "anticipate", "forecast", "expect", "believe", "may", "will", "should", "estimate", "intend" or other similar words). All statements in this document, other than those relating to historical information or current conditions, are forward-looking statements, including, but not limited to: Nutrien's business strategies, plans, prospects and opportunities; Nutrien's full-year and first-half 2021 guidance, including expectations regarding our adjusted net earnings per share and adjusted EBITDA (consolidated and by segment); expectations regarding our growth and capital allocation intentions and strategies; capital spending expectations for 2021; expectations regarding performance of our operating segments in 2021, including our operating segment market outlooks and market conditions for 2021, and the anticipated supply and demand for our products and services, expected market and industry conditions with respect to crop nutrient application rates, planted acres, crop mix, prices and the impact of import and export volumes; expectations regarding Nutrien's Feeding the Future Plan and 2021 ESG Report including its 2030 commitments and ESG performance targets; Nutrien's ability to develop innovative and sustainable solutions; the negotiation of sales contracts; Nutrien's ability to launch and scale its Carbon Program and the benefits to Nutrien and growers therefrom; and acquisitions and divestitures. These forward-looking statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from such forward-looking statements. As such, undue reliance should not be placed on these forward-looking statements.

 

All of the forward-looking statements are qualified by the assumptions that are stated or inherent in such forward-looking statements, including the assumptions referred to below and elsewhere in this document. Although we believe that these assumptions are reasonable, having regard to our experience and our perception of historical trends, this list is not exhaustive of the factors that may affect any of the forward-looking statements and the reader should not place an undue reliance on these assumptions and such forward-looking statements. Current conditions, economic and otherwise, render assumptions, although reasonable when made, subject to greater uncertainty. The additional key assumptions that have been made include, among other things, assumptions with respect to our ability to successfully complete, integrate and realize the anticipated benefits of our already completed and future acquisitions and divestitures, and that we will be able to implement our standards, controls, procedures and policies in respect of any acquired businesses and to realize the expected synergies; that future business, regulatory and industry conditions will be within the parameters expected by us, including with respect to prices, margins, demand, supply, product availability, supplier agreements, availability and cost of labor and interest, exchange and effective tax rates; assumptions with respect to global economic conditions and the accuracy of our market outlook expectations for 2021 and in the future; our expectations regarding the impacts, direct and indirect, of the COVID-19 pandemic on our business, customers, business partners, employees, supply chain, other stakeholders and the overall economy; the adequacy of our cash generated from operations and our ability to access our credit facilities or capital markets for additional sources of financing; our ability to identify suitable candidates for acquisitions and divestitures and negotiate acceptable terms; our ability to maintain investment grade ratings and achieve our performance targets; our ability to successfully negotiate sales contracts; and our ability to successfully implement new initiatives and programs.

 

Events or circumstances that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to: general global economic, market and business conditions; failure to complete announced and future acquisitions or divestitures at all or on the expected terms and within the expected timeline; climate change and weather conditions, including impacts from regional flooding and/or drought conditions; crop planted acreage, yield and prices; the supply and demand and price levels for our products; governmental and regulatory requirements and actions by governmental authorities, including changes in government policy (including tariffs, trade restrictions and climate change initiatives), government ownership requirements, changes in environmental, tax and other laws or regulations and the interpretation thereof; political risks, including civil unrest, actions by armed groups or conflict and malicious acts including terrorism; the occurrence of a major environmental or safety incident; innovation and cybersecurity risks related to our systems, including our costs of addressing or mitigating such risks; counterparty and sovereign risk; delays in completion of turnarounds at our major facilities; interruptions of or constraints in availability of key inputs, including natural gas and sulfur; any significant impairment of the carrying amount of certain assets; risks related to reputational loss; certain complications that may arise in our mining processes; the ability to attract, engage and retain skilled employees and strikes or other forms of work stoppages; the COVID-19 pandemic and its resulting effects on economic conditions, restrictions imposed by public health authorities or governments, fiscal and monetary responses by governments and financial institutions and disruptions to global supply chains; and other risk factors detailed from time to time in Nutrien reports filed with the Canadian securities regulators and the Securities and Exchange Commission in the United States.

 

The purpose of our expected adjusted net earnings per share (full year and first-half 2021), adjusted EBITDA (consolidated and by segment) and sustaining capital expenditures guidance ranges, are to assist readers in understanding our expected and targeted financial results, and this information may not be appropriate for other purposes.

 

The forward-looking statements in this document are made as of the date hereof and Nutrien disclaims any intention or obligation to update or revise any forward-looking statements in this document as a result of new information or future events, except as may be required under applicable Canadian securities legislation or applicable US federal securities laws.

 

  Terms and Definitions  

 

For the definitions of certain financial and non-financial terms used in this document, as well as a list of abbreviated company names and sources, see the "Terms and Definitions" section of our 2020 Annual Report. All references to per share amounts pertain to diluted net earnings (loss) per share, "n/m" indicates information that is not meaningful and all financial amounts are stated in millions of US dollars, unless otherwise noted.

 

  About Nutrien  

 

Nutrien is the world's largest provider of crop inputs and services, playing a critical role in helping growers increase food production in a sustainable manner. We produce and distribute 27 million tonnes of potash, nitrogen and phosphate products world-wide. With this capability and our leading agriculture retail network, we are well positioned to supply the needs of our customers. We operate with a long-term view and are committed to working with our stakeholders as we address our economic, environmental and social priorities. The scale and diversity of our integrated portfolio provides a stable earnings base, multiple avenues for growth and the opportunity to return capital to shareholders.

 

Contact us at: www.nutrien.com  

 

Selected financial data for download can be found in our data tool at www.nutrien.com/investors/interactive-datatool  

 

Such data is not incorporated by reference herein.

 

  Nutrien will host a Conference Call on Tuesday, May 4, 2021 at 10:00 am Eastern Time.  

 
  • In order to expedite access to our conference call, each participant will be required to   pre-register   for the event:
    • Online: https://www.directeventreg.com/registration/event/1167143 .
    •  
    • Via Phone: 1-888-869-1189 Conference ID 1167143.  
    •  
  •  
  • Once the registration is complete, a confirmation will be sent providing the dial in number and both the Direct Event Passcode and your unique Registrant ID to join this call. For security reasons, please do not share your information with anyone else.
  •  
  • Live Audio Webcast: Visit https://www.nutrien.com/investors/events/2021-q1-earnings-conference-call  
  •  

  Appendix A - Selected Additional Financial Data  

 
                                                                                                            
 

  Selected Retail measures  

 
 

  Three Months Ended March 31  

 
 

 

 
 

  2021  

 
 

 

 
 

  2020  

 
 

  Proprietary products margin as a percentage of product line margin (%)  

 
 

 

 
 

 

 
 

 

 
 

  Crop nutrients  

 
 

  21  

 
 

 

 
 

31

 
 

  Crop protection products  

 
 

  43  

 
 

 

 
 

40

 
 

  Seed  

 
 

  40  

 
 

 

 
 

36

 
 

  All products  

 
 

  23  

 
 

 

 
 

25

 
 

  Crop nutrients sales volumes (tonnes - thousands)  

 
 

 

 
 

 

 
 

 

 
 

  North America  

 
 

  1,597  

 
 

 

 
 

1,426

 
 

  International  

 
 

  803  

 
 

 

 
 

599

 
 

  Total  

 
 

  2,400  

 
 

 

 
 

2,025

 
 

  Crop nutrients selling price per tonne  

 
 

 

 
 

 

 
 

 

 
 

  North America  

 
 

  458  

 
 

 

 
 

416

 
 

  International  

 
 

  355  

 
 

 

 
 

318

 
 

  Total  

 
 

  423  

 
 

 

 
 

387

 
 

  Crop nutrients gross margin per tonne  

 
 

 

 
 

 

 
 

 

 
 

  North America  

 
 

  113  

 
 

 

 
 

93

 
 

  International  

 
 

  49  

 
 

 

 
 

38

 
 

  Total  

 
 

  92  

 
 

 

 
 

77

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  Financial performance measures  

 
 

 

 
 

 

 
 

  2021  

 
 

  Retail adjusted EBITDA to sales (%) 1  

 
 

 

 
 

 

 
 

  10  

 
 

  Retail adjusted average working capital to sales (%) 1, 2  

 
 

 

 
 

 

 
 

  14  

 
 

  Retail adjusted average working capital to sales excluding Nutrien Financial (%) 1, 2  

 
 

 

 
 

 

 
 

  3  

 
 

  Retail cash operating coverage ratio (%) 1, 2  

 
 

 

 
 

 

 
 

  60  

 
 

  Retail adjusted EBITDA per US selling location (thousands of US dollars) 1, 2  

 
 

 

 
 

 

 
 

  1,159  

 
 

  Nutrien Financial net interest margin (%) 1, 2  

 
 

 

 
 

 

 
 

  5.5  

 
 

  1 Rolling four quarters ended March 31, 2021.  

 
 

  2 See the "Non-IFRS Financial Measures" section.  

 
 
                                   
 

  Nutrien Financial  

 
 

  As at March 31, 2021  

 
 

  (millions of US dollars)  

 
 

  Current  

 
 

  

 

  past due  

 
 

  31-90 days  

 

  past due  

 
 

  >90 days  

 

  past due  

 
 

  Gross Receivables  

 
 

  Allowance 1  

 
 

  Total  

 
 

  North America  

 
 

860

 
 

54

 
 

62

 
 

52

 
 

1,028

 
 

(25)

 
 

  1,003  

 
 

  International  

 
 

163

 
 

3

 
 

12

 
 

42

 
 

220

 
 

(2)

 
 

  218  

 
 

  Nutrien Financial receivables  

 
 

1,023

 
 

57

 
 

74

 
 

94

 
 

1,248

 
 

(27)

 
 

  1,221  

 
 

  1 Bad debt expense on the above receivables for the three months ended March 31, 2021 was $5 million (2020 - $3 million) in the Retail segment.  

 
 
                                          
 

  Selected Nitrogen measures  

 
 

  Three Months Ended March 31  

 
 

 

 
 

  2021  

 
 

 

 
 

  2020  

 
 

  Sales volumes (tonnes - thousands)  

 
 

 

 
 

 

 
 

 

 
 

  Fertilizer  

 
 

  1,305  

 
 

 

 
 

1,411

 
 

  Industrial and feed  

 
 

  1,098  

 
 

 

 
 

1,117

 
 

  Net sales (millions of US dollars)  

 
 

 

 
 

 

 
 

 

 
 

  Fertilizer  

 
 

  332  

 
 

 

 
 

318

 
 

  Industrial and feed  

 
 

  241  

 
 

 

 
 

212

 
 

  Net selling price per tonne  

 
 

 

 
 

 

 
 

 

 
 

  Fertilizer  

 
 

  254  

 
 

 

 
 

226

 
 

  Industrial and feed  

 
 

  220  

 
 

 

 
 

190

 
 
                                     
 

  Production measures  

 
 

  Three Months Ended March 31  

 
 

 

 
 

  2021  

 
 

 

 
 

  2020  

 
 

  Potash production (Product tonnes - thousands)  

 
 

  3,536  

 
 

 

 
 

3,035

 
 

  Potash shutdown weeks 1  

 
 

  -  

 
 

 

 
 

12

 
 

  Ammonia production - total 2  

 
 

  1,449  

 
 

 

 
 

1,447

 
 

  Ammonia production - adjusted 2, 3  

 
 

  1,053  

 
 

 

 
 

991

 
 

  Ammonia operating rate (%) 3  

 
 

  97  

 
 

 

 
 

91

 
 

  P 2 O 5 production (P 2 O 5 tonnes - thousands)  

 
 

  378  

 
 

 

 
 

372

 
 

  P 2 O 5 operating rate (%)  

 
 

  90  

 
 

 

 
 

88

 
 

  1 Represents weeks of full production shutdown, excluding the impact of any periods of reduced operating rates and planned routine annual maintenance shutdowns and announced workforce reductions.  

 
 

  2 All figures are provided on a gross production basis in thousands of product tonnes.  

 
 

  3 Excludes Trinidad and Joffre.  

 
 

  Appendix B - Non-IFRS Financial Measures  

 

We use both IFRS and certain non-IFRS financial measures to assess performance. Non-IFRS financial measures are numerical measures of a company's historical or future financial performance, financial position or cash flow that are not specified, defined or determined under IFRS, and are not presented in our interim financial statements. Non-IFRS measures either exclude amounts that are included in, or include amounts that are excluded from, the most directly comparable measure specified, defined or determined under IFRS. In evaluating these measures, investors should consider that the methodology applied in calculating such measures may differ among companies and analysts.

 

Management believes the non-IFRS financial measures provide transparent and useful supplemental information to help investors evaluate our financial performance, financial condition and liquidity using the same measures as management. These non-IFRS financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with IFRS.

 

The following section outlines our non-IFRS financial measures, their definitions, and why management uses each measure. It includes reconciliations to the most directly comparable IFRS measures. Except as otherwise described herein, our non-IFRS financial measures are calculated on a consistent basis from period to period and are adjusted for specific items in each period, as applicable. As non-recurring or unusual items arise, we generally exclude these items in our calculation of the applicable non-IFRS financial measure.

 

  Adjusted EBITDA (Consolidated)  

 

  Most directly comparable IFRS financial measure: Net earnings (loss).

 

  Definition: Adjusted EBITDA is calculated as net earnings (loss) before finance costs, income taxes, depreciation and amortization, certain integration and restructuring related costs, share-based compensation, impairment of assets, certain foreign exchange gain/loss (net of related derivatives), COVID-19 related expenses, loss on disposal of business and net gain on disposal of investment in MOPCO. COVID-19 related expenses primarily consist of increased cleaning and sanitization costs, the purchase of personal protective equipment, discretionary supplemental employee costs and costs related to construction delays from access limitations and other government restrictions. In 2021, we amended our calculation of adjusted EBITDA to adjust for the impact of restructuring and related costs. There were no similar expenses in the comparative period.

 

  Why we use the measure and why it is useful to investors: It is not impacted by long-term investment and financing decisions, but rather focuses on the performance of our day-to-day operations. It provides a measure of our ability to service debt and to meet other payment obligations.

 
                                                  
 

 

 
 

  Three Months Ended March 31  

 
 

(millions of US dollars)

 
 

  2021  

 
 

 

 
 

2020

 
 

Net earnings (loss)

 
 

  133  

 
 

 

 
 

(35)

 
 

Finance costs

 
 

  120  

 
 

 

 
 

133

 
 

Income tax expense (recovery)

 
 

  25  

 
 

 

 
 

(16)

 
 

Depreciation and amortization

 
 

  480  

 
 

 

 
 

473

 
 

EBITDA

 
 

  758  

 
 

 

 
 

555

 
 

Integration and restructuring related costs

 
 

  10  

 
 

 

 
 

10

 
 

Share-based compensation expense (recovery)

 
 

  23  

 
 

 

 
 

(32)

 
 

Impairment of assets

 
 

  4  

 
 

 

 
 

-

 
 

COVID-19 related expenses

 
 

  9  

 
 

 

 
 

2

 
 

Foreign exchange loss (gain), net of related derivatives

 
 

  2  

 
 

 

 
 

(27)

 
 

Adjusted EBITDA

 
 

  806  

 
 

 

 
 

508

 
 

  Adjusted EBITDA (Consolidated), Adjusted Net Earnings Per Share and Sustaining Capital Expenditures Guidance  

 

Adjusted EBITDA, adjusted net earnings per share and sustaining capital expenditures guidance are forward-looking non-IFRS financial measures. We do not provide a reconciliation of such forward-looking measures to the most directly comparable financial measures calculated and presented in accordance with IFRS due to unknown variables and the uncertainty related to future results. These unknown variables may include unpredictable transactions of significant value that may be inherently difficult to determine, without unreasonable efforts. Guidance for adjusted EBITDA and adjusted net earnings per share excludes the impacts of integration and restructuring related costs, share-based compensation, certain foreign exchange gain/loss (net of related derivatives), and COVID-19 related expenses. Guidance for sustaining capital expenditures includes expected expenditures required to sustain operations at existing levels and includes major repairs and maintenance and plant turnarounds.

 

  Adjusted Net Earnings and Adjusted Net Earnings Per Share  

 

  Most directly comparable IFRS financial measure: Net earnings (loss) and net earnings (loss) per share.

 

  Definition: Net earnings (loss) before certain integration and restructuring related costs, share-based compensation, certain foreign exchange gain/loss (net of related derivatives), COVID-19 related expenses (including those recorded under finance costs for managing our liquidity position in response to the COVID-19 pandemic in 2020), loss on disposal of business, net gain on disposal of investment in MOPCO and impairment of assets, net of tax. We generally apply the annual forecasted effective tax rate to our adjustments during the year and, at year-end, we apply the actual effective tax rate. If the effective tax rate is significantly different from our forecasted effective tax rate due to adjustments or discrete tax impacts, we apply a tax rate that excludes those items. For material adjustments, we apply a tax rate specific to the adjustment. In 2021, we amended our calculation of adjusted net earnings to adjust for the impact of restructuring and related costs. There were no similar expenses in the comparative period.

 

  Why we use the measure and why it is useful to investors: Focuses on the performance of our day-to-day operations excluding the effects of non-operating items.

 
                                                                    
 

 

 
 

  Three Months Ended  

 

  March 31, 2021  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  Per  

 
 

 

 
 

  Increases  

 
 

 

 
 

 

 
 

 

 
 

  Diluted  

 
 

(millions of US dollars, except as otherwise noted)

 
 

  (Decreases)  

 
 

 

 
 

  Post-Tax  

 
 

 

 
 

  Share  

 
 

Net earnings attributable to equity holders of Nutrien

 
 

 

 
 

 

 
 

127

 
 

 

 
 

0.22

 
 

Adjustments:

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Integration and restructuring related costs

 
 

10

 
 

 

 
 

8

 
 

 

 
 

0.01

 
 

Share-based compensation expense

 
 

23

 
 

 

 
 

18

 
 

 

 
 

0.04

 
 

Impairment of assets

 
 

4

 
 

 

 
 

3

 
 

 

 
 

0.01

 
 

COVID-19 related expenses

 
 

9

 
 

 

 
 

7

 
 

 

 
 

0.01

 
 

Foreign exchange loss, net of related derivatives

 
 

2

 
 

 

 
 

2

 
 

 

 
 

-

 
 

Adjusted net earnings

 
 

 

 
 

 

 
 

  165  

 
 

 

 
 

  0.29  

 
 

  Free Cash Flow and Free Cash Flow Including Changes in Non-Cash Operating Working Capital  

 

  Most directly comparable IFRS financial measure: Cash from operations before working capital changes.

 

  Definition: Cash from operations before working capital changes less sustaining capital expenditures. We also calculate a similar measure that includes changes in non-cash operating working capital.

 

  Why we use the measure and why it is useful to investors: For evaluation of liquidity and financial strength. These are also useful as indicators of our ability to service debt, meet other payment obligations and make strategic investments. These do not represent residual cash flow available for discretionary expenditures.

 
                          
 

 

 
 

  Three Months Ended March 31  

 
 

(millions of US dollars)

 
 

  2021  

 
 

 

 
 

2020

 
 

Cash from operations before working capital changes

 
 

  640  

 
 

 

 
 

344

 
 

Sustaining capital expenditures

 
 

  (164)  

 
 

 

 
 

(163)

 
 

Free cash flow

 
 

  476  

 
 

 

 
 

181

 
 

Changes in non-cash operating working capital

 
 

  (792)  

 
 

 

 
 

(870)

 
 

Free cash flow including changes in non-cash

 

operating working capital

 
 

  (316)  

 
 

 

 
 

(689)

 
 

  Potash Cash Cost of Product Manufactured ("COPM")  

 

  Most directly comparable IFRS financial measure: Cost of goods sold ("COGS") for the Potash segment.

 

  Definition: Potash COGS for the period excluding depreciation and amortization expense and inventory and other adjustments divided by the production tonnes for the period.

 

  Why we use the measure and why it is useful to investors: To assess operational performance. Potash cash COPM excludes the effects of production from other periods and long-term investment decisions, supporting a focus on the performance of our day-to-day operations.

 
                                      
 

 

 
 

  Three Months Ended March 31  

 
 

(millions of US dollars, except as otherwise noted)

 
 

  2021  

 
 

 

 
 

2020

 
 

Total COGS - Potash

 
 

  291  

 
 

 

 
 

265

 
 

Change in inventory

 
 

  27  

 
 

 

 
 

8

 
 

Other adjustments

 
 

  (4)  

 
 

 

 
 

(2)

 
 

COPM

 
 

  314  

 
 

 

 
 

271

 
 

Depreciation and amortization included in COPM

 
 

  (111)  

 
 

 

 
 

(89)

 
 

Cash COPM

 
 

  203  

 
 

 

 
 

182

 
 

Production tonnes (tonnes - thousands)

 
 

  3,536  

 
 

 

 
 

3,035

 
 

Potash cash COPM per tonne

 
 

  57  

 
 

 

 
 

60

 
 

  Ammonia Controllable Cash COPM  

 

  Most directly comparable IFRS financial measure: COGS for the Nitrogen segment.

 

  Definition: The total of COGS for the Nitrogen segment excluding depreciation and amortization expense included in COGS, cash COGS for products other than ammonia, other adjustments, and natural gas and steam costs, divided by net ammonia production tonnes.

 

  Why we use the measure and why it is useful to investors: To assess operational performance. Ammonia controllable cash COPM excludes the effects of production from other periods, the costs of natural gas and steam, and long-term investment decisions, supporting a focus on the performance of our day-to-day operations.

 
                                                    
 

 

 
 

  Three Months Ended March 31  

 
 

(millions of US dollars, except as otherwise noted)

 
 

  2021  

 
 

 

 
 

2020

 
 

Total COGS - Nitrogen

 
 

  610  

 
 

 

 
 

581

 
 

Depreciation and amortization in COGS

 
 

  (108)  

 
 

 

 
 

(130)

 
 

Cash COGS for products other than ammonia

 
 

  (393)  

 
 

 

 
 

(361)

 
 

Ammonia

 
 

 

 
 

 

 
 

 

 
 

Total cash COGS before other adjustments

 
 

  109  

 
 

 

 
 

90

 
 

Other adjustments 1

 
 

  (3)  

 
 

 

 
 

11

 
 

Total cash COPM

 
 

  106  

 
 

 

 
 

101

 
 

Natural gas and steam costs

 
 

  (74)  

 
 

 

 
 

(66)

 
 

Controllable cash COPM

 
 

  32  

 
 

 

 
 

35

 
 

Production tonnes (net tonnes 2 - thousands)

 
 

  602  

 
 

 

 
 

744

 
 

Ammonia controllable cash COPM per tonne

 
 

  52  

 
 

 

 
 

47

 
 

1 Includes changes in inventory balances and other adjustments.

 
 

2 Ammonia tonnes available for sale, as not upgraded to other Nitrogen products.

 
 

  Gross Margin Excluding Depreciation and Amortization Per Tonne - Manufactured  

 

  Most directly comparable IFRS financial measure: Gross margin.

 

  Definition: Gross margin from manufactured products per tonne less depreciation and amortization per tonne. Reconciliations are provided in the "Segment Results" section.

 

  Why we use the measure and why it is useful to investors: Focuses on the performance of our day-to-day operations, which excludes the effects of items that primarily reflect the impact of long-term investment and financing decisions.

 

  Retail Adjusted Average Working Capital to Sales and Retail Adjusted Average Working Capital to Sales Excluding Nutrien Financial  

 

  Most directly comparable IFRS financial measure: (Current assets minus current liabilities for Retail) divided by Retail sales.

 

  Definition: Retail adjusted average working capital divided by Retail adjusted sales for the last four rolling quarters. We exclude in our calculations the working capital and sales of certain acquisitions (such as Ruralco) during the first year following the acquisition. We amended our calculation to adjust for the sales of certain recently acquired businesses. We also look at this metric excluding the sales and working capital of Nutrien Financial.

 

  Why we use the measure and why it is useful to investors: To evaluate operational efficiency. A lower or higher percentage represents increased or decreased efficiency, respectively. The metric excluding Nutrien Financial shows the impact that the working capital of Nutrien Financial has on the ratio.

 
                                                                                                                                                    
 

 

 
 

  Rolling four quarters ended March 31, 2021  

 
 

(millions of US dollars, except as otherwise noted)

 
 

  Q2 2020  

 
 

 

 
 

  Q3 2020  

 
 

 

 
 

  Q4 2020  

 
 

 

 
 

  Q1 2021  

 
 

 

 
 

  Average/Total  

 
 

Working capital

 
 

2,030

 
 

 

 
 

3,216

 
 

 

 
 

1,157

 
 

 

 
 

1,630

 
 

 

 
 

 

 
 

Working capital from certain recent acquisitions

 
 

63

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

 

 
 

Adjusted working capital

 
 

2,093

 
 

 

 
 

3,216

 
 

 

 
 

1,157

 
 

 

 
 

1,630

 
 

 

 
 

  2,024  

 
 

Nutrien Financial working capital

 
 

(2,108)

 
 

 

 
 

(1,711)

 
 

 

 
 

(1,392)

 
 

 

 
 

(1,221)

 
 

 

 
 

 

 
 

Adjusted working capital excluding Nutrien Financial

 
 

(15)

 
 

 

 
 

1,505

 
 

 

 
 

(235)

 
 

 

 
 

409

 
 

 

 
 

  416  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Sales 1

 
 

6,764

 
 

 

 
 

2,742

 
 

 

 
 

2,618

 
 

 

 
 

2,972

 
 

 

 
 

 

 
 

Sales from certain recent acquisitions

 
 

(338)

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

 

 
 

Adjusted sales

 
 

6,426

 
 

 

 
 

2,742

 
 

 

 
 

2,618

 
 

 

 
 

2,972

 
 

 

 
 

  14,758  

 
 

Nutrien Financial revenue 1

 
 

(40)

 
 

 

 
 

(36)

 
 

 

 
 

(37)

 
 

 

 
 

(25)

 
 

 

 
 

 

 
 

Adjusted sales excluding Nutrien Financial

 
 

6,386

 
 

 

 
 

2,706

 
 

 

 
 

2,581

 
 

 

 
 

2,947

 
 

 

 
 

  14,620  

 
 

1 Certain immaterial figures have been reclassified for the second and third quarters of 2020.

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  Adjusted average working capital to sales (%)  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  14  

 
 

  Adjusted average working capital to sales excluding Nutrien Financial (%)  

 
 

 

 
 

 

 
 

 

 
 

  3  

 
 

  Nutrien Financial Net Interest Margin  

 

  Most directly comparable IFRS financial measure: Nutrien Financial gross margin divided by average Nutrien Financial receivables.

 

  Definition: Nutrien Financial revenue less deemed interest expense divided by average Nutrien Financial receivables outstanding for the last four rolling quarters.

 

  Why we use the measure and why it is useful to investors: Used by credit rating agencies and other users to evaluate financial performance of Nutrien Financial.

 
                                                                         
 

 

 
 

  Rolling four quarters ended March 31, 2021  

 
 

(millions of US dollars, except as otherwise noted)

 
 

  Q2 2020  

 
 

 

 
 

  Q3 2020  

 
 

 

 
 

  Q4 2020  

 
 

 

 
 

  Q1 2021  

 
 

 

 
 

  Total/Average  

 
 

Nutrien Financial revenue

 
 

40

 
 

 

 
 

36

 
 

 

 
 

37

 
 

 

 
 

25

 
 

 

 
 

 

 
 

Deemed interest expense 1

 
 

(15)

 
 

 

 
 

(15)

 
 

 

 
 

(14)

 
 

 

 
 

(6)

 
 

 

 
 

 

 
 

Net interest

 
 

25

 
 

 

 
 

21

 
 

 

 
 

23

 
 

 

 
 

19

 
 

 

 
 

  88  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Average Nutrien Financial receivables

 
 

2,108

 
 

 

 
 

1,711

 
 

 

 
 

1,392

 
 

 

 
 

1,221

 
 

 

 
 

  1,608  

 
 

Nutrien Financial net interest margin (%)

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  5.5  

 
 

1 Average borrowing rate applied to the notional debt required to fund the portfolio of receivables from customers monitored and serviced by Nutrien Financial.

 
 

  Retail Cash Operating Coverage Ratio  

 

  Most directly comparable IFRS financial measure: Retail operating expenses as a percentage of Retail gross margin.

 

  Definition: Retail operating expenses, excluding depreciation and amortization expense, divided by Retail gross margin excluding depreciation and amortization expense in cost of goods sold, for the last four rolling quarters.

 

  Why we use the measure and why it is useful to investors: To understand the costs and underlying economics of our Retail operations and to assess our Retail operating performance and ability to generate free cash flow.

 
                                                                                              
 

 

 
 

  Rolling four quarters ended March 31, 2021  

 
 

(millions of US dollars, except as otherwise noted)

 
 

  Q2 2020  

 
 

 

 
 

  Q3 2020  

 
 

 

 
 

  Q4 2020  

 
 

 

 
 

  Q1 2021  

 
 

 

 
 

  Total  

 
 

Operating expenses 1, 2

 
 

826

 
 

 

 
 

691

 
 

 

 
 

768

 
 

 

 
 

721

 
 

 

 
 

  3,006  

 
 

Depreciation and amortization in operating expenses

 
 

(161)

 
 

 

 
 

(167)

 
 

 

 
 

(177)

 
 

 

 
 

(175)

 
 

 

 
 

  (680)  

 
 

Operating expenses excluding depreciation and amortization

 
 

665

 
 

 

 
 

524

 
 

 

 
 

591

 
 

 

 
 

546

 
 

 

 
 

  2,326  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Gross margin 2

 
 

1,627

 
 

 

 
 

683

 
 

 

 
 

885

 
 

 

 
 

652

 
 

 

 
 

  3,847  

 
 

Depreciation and amortization in cost of goods sold

 
 

2

 
 

 

 
 

3

 
 

 

 
 

3

 
 

 

 
 

2

 
 

 

 
 

  10  

 
 

Gross margin excluding depreciation and amortization

 
 

1,629

 
 

 

 
 

686

 
 

 

 
 

888

 
 

 

 
 

654

 
 

 

 
 

  3,857  

 
 

Cash operating coverage ratio (%)

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  60  

 
 

1 Includes Retail expenses below gross margin including selling expenses, general and administrative expenses and other (income) expenses.

 
 

2 Certain immaterial figures have been reclassified for the second and third quarters of 2020.

 
 

  Retail Adjusted EBITDA per US Selling Location  

 

  Most directly comparable IFRS financial measure: Retail US adjusted EBITDA.

 

  Definition: Total Retail US adjusted EBITDA for the last four rolling quarters, adjusted for acquisitions in those quarters, divided by the number of US locations that have generated sales in the last four rolling quarters, adjusted for acquired locations.

 

  Why we use the measure and why it is useful to investors: To assess our US Retail operating performance. This measure includes locations we have owned for more than 12 months.

 
                                                             
 

 

 
 

  Rolling four quarters ended March 31, 2021  

 
 

(millions of US dollars, except as otherwise noted)

 
 

  Q2 2020  

 
 

 

 
 

  Q3 2020  

 
 

 

 
 

  Q4 2020  

 
 

 

 
 

  Q1 2021  

 
 

 

 
 

  Total  

 
 

Adjusted US EBITDA

 
 

766

 
 

 

 
 

86

 
 

 

 
 

177

 
 

 

 
 

29

 
 

 

 
 

  1,058  

 
 

Adjustments for acquisitions

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  (6)  

 
 

Adjusted US EBITDA adjusted for acquisitions

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  1,052  

 
 

Number of US selling locations adjusted for acquisitions

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  908  

 
 

Adjusted EBITDA per US selling location (thousands of US dollars)

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  1,159  

 
 

  Condensed Consolidated Financial Statements  

 

  Unaudited - in millions of US dollars except as otherwise noted  

 

  Condensed Consolidated Statements of Earnings (Loss)  

 
                                                                                                                                   
 

 

 
 

 

 
 

  Three Months Ended  

 
 

 

 
 

 

 
 

  March 31  

 
 

 

 
 

Note

 
 

  2021  

 
 

 

 
 

2020

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Note 1

 
 

  SALES  

 
 

2

 
 

  4,658  

 
 

 

 
 

4,198

 
 

Freight, transportation and distribution

 
 

 

 
 

  211  

 
 

 

 
 

212

 
 

Cost of goods sold

 
 

 

 
 

  3,291  

 
 

 

 
 

3,101

 
 

  GROSS MARGIN  

 
 

 

 
 

  1,156  

 
 

 

 
 

885

 
 

Selling expenses

 
 

 

 
 

  673  

 
 

 

 
 

642

 
 

General and administrative expenses

 
 

 

 
 

  103  

 
 

 

 
 

104

 
 

Provincial mining taxes

 
 

 

 
 

  58  

 
 

 

 
 

57

 
 

Share-based compensation expense (recovery)

 
 

3

 
 

  23  

 
 

 

 
 

(32)

 
 

Other expenses

 
 

4

 
 

  21  

 
 

 

 
 

32

 
 

  EARNINGS BEFORE FINANCE COSTS AND INCOME TAXES  

 
 

  278  

 
 

 

 
 

82

 
 

Finance costs

 
 

 

 
 

  120  

 
 

 

 
 

133

 
 

  EARNINGS (LOSS) BEFORE INCOME TAXES  

 
 

 

 
 

  158  

 
 

 

 
 

(51)

 
 

Income tax expense (recovery)

 
 

5

 
 

  25  

 
 

 

 
 

(16)

 
 

  NET EARNINGS (LOSS)  

 
 

 

 
 

  133  

 
 

 

 
 

(35)

 
 

Attributable to

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Equity holders of Nutrien

 
 

 

 
 

  127  

 
 

 

 
 

(35)

 
 

Non-controlling interest

 
 

 

 
 

  6  

 
 

 

 
 

-

 
 

  NET EARNINGS (LOSS)  

 
 

 

 
 

  133  

 
 

 

 
 

(35)

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  NET EARNINGS (LOSS) PER SHARE ATTRIBUTABLE TO EQUITY HOLDERS OF NUTRIEN ("EPS")  

 
 

Basic

 
 

 

 
 

  0.22  

 
 

 

 
 

(0.06)

 
 

Diluted

 
 

 

 
 

  0.22  

 
 

 

 
 

(0.06)

 
 

Weighted average shares outstanding for basic EPS

 
 

 

 
 

  569,658,000  

 
 

 

 
 

571,168,000

 
 

Weighted average shares outstanding for diluted EPS

 
 

 

 
 

  570,901,000  

 
 

 

 
 

571,168,000

 
 

  Condensed Consolidated Statements of Comprehensive Income (Loss)  

 
                                                                         
 

 

 
 

  Three Months Ended  

 
 

 

 
 

  March 31  

 
 

(Net of related income taxes)

 
 

  2021  

 
 

 

 
 

2020

 
 

  NET EARNINGS (LOSS)  

 
 

  133  

 
 

 

 
 

(35)

 
 

Other comprehensive income (loss)

 
 

 

 
 

 

 
 

 

 
 

Items that will not be reclassified to net earnings (loss):

 
 

 

 
 

 

 
 

 

 
 

Net actuarial gain on defined benefit plans

 
 

  -  

 
 

 

 
 

3

 
 

Net fair value gain (loss) on investments

 
 

  48  

 
 

 

 
 

(19)

 
 

Items that have been or may be subsequently reclassified to

 
 

 

 
 

 

 
 

 

 
 

net earnings (loss):

 
 

Loss on currency translation of foreign operations

 
 

  (30)  

 
 

 

 
 

(315)

 
 

Other

 
 

  6  

 
 

 

 
 

(27)

 
 

  OTHER COMPREHENSIVE INCOME (LOSS)  

 
 

  24  

 
 

 

 
 

(358)

 
 

  COMPREHENSIVE INCOME (LOSS)  

 
 

  157  

 
 

 

 
 

(393)

 
 

Attributable to

 
 

 

 
 

 

 
 

 

 
 

Equity holders of Nutrien

 
 

  151  

 
 

 

 
 

(393)

 
 

Non-controlling interest

 
 

  6  

 
 

 

 
 

-

 
 

  COMPREHENSIVE INCOME (LOSS)  

 
 

  157  

 
 

 

 
 

(393)

 
 

 

 
 

 

 
 

 

 
 

 

 
 

(See Notes to the Condensed Consolidated Financial Statements)

 

 

 
 

  Condensed Consolidated Statements of Cash Flows  

 
                                                                                                                                                                                                                                        
 

 

 
 

 

 
 

  Three Months Ended  

 
 

 

 
 

 

 
 

  March 31  

 
 

 

 
 

Note

 
 

  2021  

 
 

 

 
 

2020

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  OPERATING ACTIVITIES  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Net earnings (loss)

 
 

 

 
 

  133  

 
 

 

 
 

(35)

 
 

Adjustments for:

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Depreciation and amortization

 
 

 

 
 

  480  

 
 

 

 
 

473

 
 

Share-based compensation expense (recovery)

 
 

 

 
 

  23  

 
 

 

 
 

(32)

 
 

Impairment of assets

 
 

 

 
 

  4  

 
 

 

 
 

-

 
 

Provision for (recovery of) deferred income tax

 
 

 

 
 

  10  

 
 

 

 
 

(22)

 
 

Other long-term assets, liabilities and miscellaneous

 
 

 

 
 

  (10)  

 
 

 

 
 

(40)

 
 

Cash from operations before working capital changes

 
 

 

 
 

  640  

 
 

 

 
 

344

 
 

Changes in non-cash operating working capital:

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Receivables

 
 

 

 
 

  (392)  

 
 

 

 
 

(323)

 
 

Inventories

 
 

 

 
 

  (1,785)  

 
 

 

 
 

(1,428)

 
 

Prepaid expenses and other current assets

 
 

 

 
 

  688  

 
 

 

 
 

766

 
 

Payables and accrued charges

 
 

 

 
 

  697  

 
 

 

 
 

115

 
 

  CASH USED IN OPERATING ACTIVITIES  

 
 

 

 
 

  (152)  

 
 

 

 
 

(526)

 
 

  INVESTING ACTIVITIES  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Additions to property, plant and equipment

 
 

 

 
 

  (325)  

 
 

 

 
 

(363)

 
 

Additions to intangible assets

 
 

 

 
 

  (33)  

 
 

 

 
 

(32)

 
 

Business acquisitions, net of cash acquired

 
 

 

 
 

  (21)  

 
 

 

 
 

(57)

 
 

Other

 
 

 

 
 

  (9)  

 
 

 

 
 

7

 
 

  CASH USED IN INVESTING ACTIVITIES  

 
 

 

 
 

  (388)  

 
 

 

 
 

(445)

 
 

  FINANCING ACTIVITIES  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Proceeds from short-term debt, net

 
 

 

 
 

  101  

 
 

 

 
 

4,494

 
 

Proceeds from long-term debt

 
 

 

 
 

  -  

 
 

 

 
 

6

 
 

Repayment of long-term debt

 
 

 

 
 

  -  

 
 

 

 
 

(501)

 
 

Repayment of principal portion of lease liabilities

 
 

 

 
 

  (78)  

 
 

 

 
 

(64)

 
 

Dividends paid to Nutrien's shareholders

 
 

7

 
 

  (255)  

 
 

 

 
 

(256)

 
 

Repurchase of common shares

 
 

7

 
 

  (1)  

 
 

 

 
 

(160)

 
 

Issuance of common shares

 
 

 

 
 

  42  

 
 

 

 
 

-

 
 

  CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES  

 
 

 

 
 

  (191)  

 
 

 

 
 

3,519

 
 

  EFFECT OF EXCHANGE RATE CHANGES ON CASH AND  

 

  CASH EQUIVALENTS  

 
 

 

 
 

  (11)  

 
 

 

 
 

(37)

 
 

  (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS  

 
 

 

 
 

  (742)  

 
 

 

 
 

2,511

 
 

  CASH AND CASH EQUIVALENTS – BEGINNING OF PERIOD  

 
 

 

 
 

  1,454  

 
 

 

 
 

671

 
 

  CASH AND CASH EQUIVALENTS – END OF PERIOD  

 
 

 

 
 

  712  

 
 

 

 
 

3,182

 
 

Cash and cash equivalents comprised of:

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Cash

 
 

 

 
 

  601  

 
 

 

 
 

389

 
 

Short-term investments

 
 

 

 
 

  111  

 
 

 

 
 

2,793

 
 

 

 
 

 

 
 

  712  

 
 

 

 
 

3,182

 
 

  SUPPLEMENTAL CASH FLOWS INFORMATION  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Interest paid

 
 

 

 
 

  76  

 
 

 

 
 

96

 
 

Income taxes paid

 
 

 

 
 

  39  

 
 

 

 
 

35

 
 

Total cash outflow for leases

 
 

 

 
 

  97  

 
 

 

 
 

92

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

(See Notes to the Condensed Consolidated Financial Statements)

 

 

 
 

  Condensed Consolidated Statements of Changes in Shareholders' Equity  

 
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Accumulated Other Comprehensive (Loss) Income ("AOCI")

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Net

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Actuarial

 
 

 

 
 

Loss on

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Equity

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Net Fair Value

 
 

 

 
 

Gain on

 
 

 

 
 

Currency

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Holders

 
 

 

 
 

Non-

 
 

 

 
 

 

 
 

 

 
 

Number of

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

(Loss) Gain

 
 

 

 
 

Defined

 
 

 

 
 

Translation

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

of

 
 

 

 
 

Controlling

 
 

 

 
 

 

 
 

 

 
 

Common

 
 

 

 
 

Share

 
 

Contributed

 
 

 

 
 

on

 
 

 

 
 

Benefit

 
 

 

 
 

of Foreign

 
 

 

 
 

 

 
 

 

 
 

Total

 
 

 

 
 

Retained

 
 

 

 
 

Nutrien

 
 

 

 
 

Interest

 
 

 

 
 

Total

 
 

 

 
 

Shares

 
 

 

 
 

Capital

 
 

 

 
 

Surplus

 
 

 

 
 

Investments

 
 

 

 
 

Plans 1

 
 

 

 
 

Operations

 
 

 

 
 

Other

 
 

 

 
 

AOCI

 
 

 

 
 

Earnings

 
 

 

 
 

(Note 1)

 
 

 

 
 

(Note 1)

 
 

 

 
 

Equity

 
 

  BALANCE – DECEMBER 31, 2019  

 
 

572,942,809

 
 

 

 
 

15,771

 
 

 

 
 

248

 
 

 

 
 

(29)

 
 

 

 
 

-

 
 

 

 
 

(204)

 
 

 

 
 

(18)

 
 

 

 
 

(251)

 
 

 

 
 

7,101

 
 

 

 
 

22,869

 
 

 

 
 

38

 
 

 

 
 

22,907

 
 

Net loss

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

(35)

 
 

 

 
 

(35)

 
 

 

 
 

-

 
 

 

 
 

(35)

 
 

Other comprehensive (loss) income

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

(19)

 
 

 

 
 

3

 
 

 

 
 

(315)

 
 

 

 
 

(27)

 
 

 

 
 

(358)

 
 

 

 
 

-

 
 

 

 
 

(358)

 
 

 

 
 

-

 
 

 

 
 

(358)

 
 

Shares repurchased (Note 7)

 
 

(3,832,580)

 
 

 

 
 

(105)

 
 

 

 
 

(55)

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

(160)

 
 

 

 
 

-

 
 

 

 
 

(160)

 
 

Dividends declared

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

(254)

 
 

 

 
 

(254)

 
 

 

 
 

-

 
 

 

 
 

(254)

 
 

Effect of share-based

 
 
 

compensation including

 
 
 

issuance of common shares

 
 

35,706

 
 

 

 
 

1

 
 

 

 
 

4

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

5

 
 

 

 
 

-

 
 

 

 
 

5

 
 

Transfer of net loss on

 
 
 

cash flow hedges

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

5

 
 

 

 
 

5

 
 

 

 
 

-

 
 

 

 
 

5

 
 

 

 
 

-

 
 

 

 
 

5

 
 

Transfer of net actuarial gain

 
 
 

on defined benefit plans

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

(3)

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

(3)

 
 

 

 
 

3

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

  BALANCE – MARCH 31, 2020  

 
 

569,145,935

 
 

 

 
 

15,667

 
 

 

 
 

197

 
 

 

 
 

(48)

 
 

 

 
 

-

 
 

 

 
 

(519)

 
 

 

 
 

(40)

 
 

 

 
 

(607)

 
 

 

 
 

6,815

 
 

 

 
 

22,072

 
 

 

 
 

38

 
 

 

 
 

22,110

 
 

  BALANCE – DECEMBER 31, 2020  

 
 

  569,260,406  

 
 

 

 
 

  15,673  

 
 

 

 
 

  205  

 
 

 

 
 

  (36)  

 
 

 

 
 

  -  

 
 

 

 
 

  (62)  

 
 

 

 
 

  (21)  

 
 

 

 
 

  (119)  

 
 

 

 
 

  6,606  

 
 

 

 
 

  22,365  

 
 

 

 
 

  38  

 
 

 

 
 

  22,403  

 
 

Net earnings

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  127  

 
 

 

 
 

  127  

 
 

 

 
 

  6  

 
 

 

 
 

  133  

 
 

Other comprehensive income (loss)

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  48  

 
 

 

 
 

  -  

 
 

 

 
 

  (30)  

 
 

 

 
 

  6  

 
 

 

 
 

  24  

 
 

 

 
 

  -  

 
 

 

 
 

  24  

 
 

 

 
 

  -  

 
 

 

 
 

  24  

 
 

Shares repurchased (Note 7)

 
 

  (14,978)  

 
 

 

 
 

  (1)  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  (1)  

 
 

 

 
 

  -  

 
 

 

 
 

  (1)  

 
 

Dividends declared

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  (262)  

 
 

 

 
 

  (262)  

 
 

 

 
 

  -  

 
 

 

 
 

  (262)  

 
 

Dividends of non-controlling interest

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  (1)  

 
 

 

 
 

  (1)  

 
 

Non-controlling interest transactions

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  (1)  

 
 

 

 
 

  (1)  

 
 

Effect of share-based

 
 
 

compensation including

 
 
 

issuance of common shares

 
 

  965,744  

 
 

 

 
 

  50  

 
 

 

 
 

  (3)  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  47  

 
 

 

 
 

  -  

 
 

 

 
 

  47  

 
 

Transfer of net gain on

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 
 

cash flow hedges

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  (3)  

 
 

 

 
 

  (3)  

 
 

 

 
 

  -  

 
 

 

 
 

  (3)  

 
 

 

 
 

  -  

 
 

 

 
 

  (3)  

 
 

  BALANCE – MARCH 31, 2021  

 
 

  570,211,172  

 
 

 

 
 

  15,722  

 
 

 

 
 

  202  

 
 

 

 
 

  12  

 
 

 

 
 

  -  

 
 

 

 
 

  (92)  

 
 

 

 
 

  (18)  

 
 

 

 
 

  (98)  

 
 

 

 
 

  6,471  

 
 

 

 
 

  22,297  

 
 

 

 
 

  42  

 
 

 

 
 

  22,339  

 
 

1 Any amounts incurred during a period were transferred to retained earnings at each period-end. Therefore, no balance exists at the beginning or end of period.

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

(See Notes to the Condensed Consolidated Financial Statements)

 

 

 
 

  Condensed Consolidated Balance Sheets  

 
                                                                                                                                                                                                                                                                                                     
 

 

 
 

 

 
 

  March 31  

 
 

 

 
 

December 31

 
 

As at

 
 

Note

 
 

  2021  

 
 

 

 
 

2020

 
 

 

 
 

2020

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Note 1

 
 

 

 
 

Note 1

 
 

  ASSETS  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Current assets

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Cash and cash equivalents

 
 

 

 
 

  712  

 
 

 

 
 

3,182

 
 

 

 
 

1,454

 
 

Receivables

 
 

 

 
 

  4,230  

 
 

 

 
 

3,837

 
 

 

 
 

3,581

 
 

Inventories

 
 

 

 
 

  6,714  

 
 

 

 
 

6,290

 
 

 

 
 

4,930

 
 

Prepaid expenses and other current assets

 
 

 

 
 

  819  

 
 

 

 
 

716

 
 

 

 
 

1,505

 
 

 

 
 

 

 
 

  12,475  

 
 

 

 
 

14,025

 
 

 

 
 

11,470

 
 

Non-current assets

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Property, plant and equipment

 
 

 

 
 

  19,451  

 
 

 

 
 

20,209

 
 

 

 
 

19,660

 
 

Goodwill

 
 

 

 
 

  12,199  

 
 

 

 
 

11,893

 
 

 

 
 

12,198

 
 

Other intangible assets

 
 

 

 
 

  2,460  

 
 

 

 
 

2,379

 
 

 

 
 

2,388

 
 

Investments

 
 

 

 
 

  630  

 
 

 

 
 

810

 
 

 

 
 

562

 
 

Other assets

 
 

 

 
 

  678  

 
 

 

 
 

552

 
 

 

 
 

914

 
 

  TOTAL ASSETS  

 
 

 

 
 

  47,893  

 
 

 

 
 

49,868

 
 

 

 
 

47,192

 
 

  LIABILITIES  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Current liabilities

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Short-term debt

 
 

 

 
 

  252  

 
 

 

 
 

5,498

 
 

 

 
 

159

 
 

Current portion of long-term debt

 
 

 

 
 

  14  

 
 

 

 
 

-

 
 

 

 
 

14

 
 

Current portion of lease liabilities

 
 

 

 
 

  260  

 
 

 

 
 

221

 
 

 

 
 

249

 
 

Payables and accrued charges

 
 

 

 
 

  8,742  

 
 

 

 
 

7,362

 
 

 

 
 

8,058

 
 

 

 
 

 

 
 

  9,268  

 
 

 

 
 

13,081

 
 

 

 
 

8,480

 
 

Non-current liabilities

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Long-term debt

 
 

 

 
 

  10,040  

 
 

 

 
 

8,544

 
 

 

 
 

10,047

 
 

Lease liabilities

 
 

 

 
 

  876  

 
 

 

 
 

848

 
 

 

 
 

891

 
 

Deferred income tax liabilities

 
 

5

 
 

  3,168  

 
 

 

 
 

3,130

 
 

 

 
 

3,149

 
 

Pension and other post-retirement benefit liabilities

 
 

 

 
 

  456  

 
 

 

 
 

426

 
 

 

 
 

454

 
 

Asset retirement obligations and accrued environmental costs

 
 

 

 
 

  1,610  

 
 

 

 
 

1,620

 
 

 

 
 

1,597

 
 

Other non-current liabilities

 
 

 

 
 

  136  

 
 

 

 
 

109

 
 

 

 
 

171

 
 

  TOTAL LIABILITIES  

 
 

 

 
 

  25,554  

 
 

 

 
 

27,758

 
 

 

 
 

24,789

 
 

  SHAREHOLDERS' EQUITY  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Share capital

 
 

7

 
 

  15,722  

 
 

 

 
 

15,667

 
 

 

 
 

15,673

 
 

Contributed surplus

 
 

 

 
 

  202  

 
 

 

 
 

197

 
 

 

 
 

205

 
 

Accumulated other comprehensive loss

 
 

 

 
 

  (98)  

 
 

 

 
 

(607)

 
 

 

 
 

(119)

 
 

Retained earnings

 
 

 

 
 

  6,471  

 
 

 

 
 

6,815

 
 

 

 
 

6,606

 
 

Equity holders of Nutrien

 
 

 

 
 

  22,297  

 
 

 

 
 

22,072

 
 

 

 
 

22,365

 
 

Non-controlling interest

 
 

 

 
 

  42  

 
 

 

 
 

38

 
 

 

 
 

38

 
 

  TOTAL SHAREHOLDERS' EQUITY  

 
 

 

 
 

  22,339  

 
 

 

 
 

22,110

 
 

 

 
 

22,403

 
 

  TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY  

 
 

 

 
 

  47,893  

 
 

 

 
 

49,868

 
 

 

 
 

47,192

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

(See Notes to the Condensed Consolidated Financial Statements)

 

 

 
 

  Notes to the Condensed Consolidated Financial Statements  

 

  As at and for the Three Months Ended March 31, 2021    

 

  NOTE 1   BASIS OF PRESENTATION  

 

Nutrien Ltd. (collectively with its subsidiaries, known as "Nutrien", "we", "us", "our" or "the Company") is the world's largest provider of crop inputs and services. Nutrien plays a critical role in helping growers around the globe increase food production in a sustainable manner.

 

These unaudited interim condensed consolidated financial statements ("interim financial statements") are based on International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board and have been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting". The accounting policies and methods of computation used in preparing these interim financial statements are consistent with those used in the preparation of our 2020 annual consolidated financial statements. These interim financial statements include the accounts of Nutrien and its subsidiaries; however, they do not include all disclosures normally provided in annual consolidated financial statements and should be read in conjunction with our 2020 annual consolidated financial statements. In April 2021, the IFRS Interpretations Committee published a final agenda decision clarifying how to recognize certain configuration and customization expenditures related to cloud computing. We are currently evaluating the impact of this agenda decision; however, we do not anticipate it will have a material impact on our financial statements. We expect to implement the change in 2021.

 

Certain immaterial 2020 figures have been reclassified in the condensed consolidated statements of earnings (loss), condensed consolidated statements of changes in shareholders' equity, condensed consolidated balance sheets and segment information.

 

In management's opinion, the interim financial statements include all adjustments necessary to fairly present such information in all material respects. Interim results are not necessarily indicative of the results expected for any other interim period or the fiscal year.

 

We prepare our interim financial statements in accordance with IFRS, which requires us to make judgments, assumptions and estimates in applying accounting policies. We have assessed our accounting estimates and other matters that require the use of forecasted financial information for the impacts arising from the novel coronavirus ("COVID-19") pandemic. The future assessment of these estimates, including expectations about the severity, duration and scope of the pandemic, could differ materially in future reporting periods. As a result of the COVID-19 pandemic, we incurred directly attributable and incremental COVID-19 related expenses in other expenses (Note 4).

 

These interim financial statements were authorized by the audit committee of the Board of Directors for issue on May 3, 2021.

 

  NOTE 2   SEGMENT INFORMATION  

 

The Company has four reportable operating segments: Nutrien Ag Solutions ("Retail"), Potash, Nitrogen and Phosphate. The Retail segment distributes crop nutrients, crop protection products, seed and merchandise, and it provides services directly to growers through a network of farm centers in North America, South America and Australia. The Potash, Nitrogen and Phosphate segments are differentiated by the chemical nutrient contained in the products that each produce.

 
                                                                                                                                                                                                                                                                                                                                                                      
 

 

 
 

 

 
 

  Three Months Ended March 31, 2021  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  Corporate  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  Retail  

 
 

 

 
 

  Potash  

 
 

 

 
 

  Nitrogen  

 
 

 

 
 

  Phosphate  

 
 

 

 
 

  and Others  

 
 

 

 
 

  Eliminations  

 
 

 

 
 

  Consolidated  

 
 

  Sales  

 
 

  – third party  

 
 

  2,960  

 
 

 

 
 

  631  

 
 

 

 
 

  695  

 
 

 

 
 

  372  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  4,658  

 
 

 

 
 

  – intersegment  

 
 

  12  

 
 

 

 
 

  90  

 
 

 

 
 

  160  

 
 

 

 
 

  72  

 
 

 

 
 

  -  

 
 

 

 
 

  (334)  

 
 

 

 
 

  -  

 
 

  Sales  

 
 

  – total  

 
 

  2,972  

 
 

 

 
 

  721  

 
 

 

 
 

  855  

 
 

 

 
 

  444  

 
 

 

 
 

  -  

 
 

 

 
 

  (334)  

 
 

 

 
 

  4,658  

 
 

  Freight, transportation and distribution  

 
 

  -  

 
 

 

 
 

  110  

 
 

 

 
 

  95  

 
 

 

 
 

  59  

 
 

 

 
 

  -  

 
 

 

 
 

  (53)  

 
 

 

 
 

  211  

 
 

  Net sales  

 
 

  2,972  

 
 

 

 
 

  611  

 
 

 

 
 

  760  

 
 

 

 
 

  385  

 
 

 

 
 

  -  

 
 

 

 
 

  (281)  

 
 

 

 
 

  4,447  

 
 

  Cost of goods sold  

 
 

  2,320  

 
 

 

 
 

  291  

 
 

 

 
 

  610  

 
 

 

 
 

  319  

 
 

 

 
 

  -  

 
 

 

 
 

  (249)  

 
 

 

 
 

  3,291  

 
 

  Gross margin  

 
 

  652  

 
 

 

 
 

  320  

 
 

 

 
 

  150  

 
 

 

 
 

  66  

 
 

 

 
 

  -  

 
 

 

 
 

  (32)  

 
 

 

 
 

  1,156  

 
 

  Selling expenses  

 
 

  667  

 
 

 

 
 

  3  

 
 

 

 
 

  7  

 
 

 

 
 

  2  

 
 

 

 
 

  (6)  

 
 

 

 
 

  -  

 
 

 

 
 

  673  

 
 

  General and administrative expenses  

 
 

  39  

 
 

 

 
 

  2  

 
 

 

 
 

  2  

 
 

 

 
 

  2  

 
 

 

 
 

  58  

 
 

 

 
 

  -  

 
 

 

 
 

  103  

 
 

  Provincial mining taxes  

 
 

  -  

 
 

 

 
 

  58  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  58  

 
 

  Share-based compensation expense  

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  23  

 
 

 

 
 

  -  

 
 

 

 
 

  23  

 
 

  Other expenses (income)  

 
 

  15  

 
 

 

 
 

  1  

 
 

 

 
 

  (26)  

 
 

 

 
 

  3  

 
 

 

 
 

  28  

 
 

 

 
 

  -  

 
 

 

 
 

  21  

 
 

  (Loss) earnings before finance costs and   income taxes  

 
 

  (69)  

 
 

 

 
 

  256  

 
 

 

 
 

  167  

 
 

 

 
 

  59  

 
 

 

 
 

  (103)  

 
 

 

 
 

  (32)  

 
 

 

 
 

  278  

 
 

  Depreciation and amortization  

 
 

  177  

 
 

 

 
 

  124  

 
 

 

 
 

  129  

 
 

 

 
 

  38  

 
 

 

 
 

  12  

 
 

 

 
 

  -  

 
 

 

 
 

  480  

 
 

  EBITDA  

 
 

  108  

 
 

 

 
 

  380  

 
 

 

 
 

  296  

 
 

 

 
 

  97  

 
 

 

 
 

  (91)  

 
 

 

 
 

  (32)  

 
 

 

 
 

  758  

 
 

  Integration and restructuring related costs  

 
 

  1  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  9  

 
 

 

 
 

  -  

 
 

 

 
 

  10  

 
 

  Share-based compensation expense  

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  23  

 
 

 

 
 

  -  

 
 

 

 
 

  23  

 
 

  Impairment of assets  

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  4  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  4  

 
 

  COVID-19 related expenses  

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  9  

 
 

 

 
 

  -  

 
 

 

 
 

  9  

 
 

  Foreign exchange loss, net of  

 
 
 

  related derivatives  

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  -  

 
 

 

 
 

  2  

 
 

 

 
 

  -  

 
 

 

 
 

  2  

 
 

  Adjusted EBITDA  

 
 

  109  

 
 

 

 
 

  380  

 
 

 

 
 

  300  

 
 

 

 
 

  97  

 
 

 

 
 

  (48)  

 
 

 

 
 

  (32)  

 
 

 

 
 

  806  

 
 

  Assets – at March 31, 2021  

 
 

  21,624  

 
 

 

 
 

  11,817  

 
 

 

 
 

  10,240  

 
 

 

 
 

  1,391  

 
 

 

 
 

  3,257  

 
 

 

 
 

  (436)  

 
 

 

 
 

  47,893  

 
 
                                                                                                                                                                                                                                                                                                                                                         
 

 

 
 

 

 
 

Three Months Ended March 31, 2020

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Corporate

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Retail

 
 

 

 
 

Potash

 
 

 

 
 

Nitrogen

 
 

 

 
 

Phosphate

 
 

 

 
 

and Others

 
 

 

 
 

Eliminations

 
 

 

 
 

Consolidated

 
 

Sales

 
 

– third party

 
 

2,652

 
 

 

 
 

547

 
 

 

 
 

646

 
 

 

 
 

326

 
 

 

 
 

27

 
 

 

 
 

-

 
 

 

 
 

4,198

 
 

 

 
 

– intersegment

 
 

9

 
 

 

 
 

64

 
 

 

 
 

132

 
 

 

 
 

57

 
 

 

 
 

-

 
 

 

 
 

(262)

 
 

 

 
 

-

 
 

Sales

 
 

– total

 
 

2,661

 
 

 

 
 

611

 
 

 

 
 

778

 
 

 

 
 

383

 
 

 

 
 

27

 
 

 

 
 

(262)

 
 

 

 
 

4,198

 
 

Freight, transportation and distribution

 
 

-

 
 

 

 
 

94

 
 

 

 
 

100

 
 

 

 
 

70

 
 

 

 
 

-

 
 

 

 
 

(52)

 
 

 

 
 

212

 
 

Net sales

 
 

2,661

 
 

 

 
 

517

 
 

 

 
 

678

 
 

 

 
 

313

 
 

 

 
 

27

 
 

 

 
 

(210)

 
 

 

 
 

3,986

 
 

Cost of goods sold

 
 

2,120

 
 

 

 
 

265

 
 

 

 
 

581

 
 

 

 
 

320

 
 

 

 
 

25

 
 

 

 
 

(210)

 
 

 

 
 

3,101

 
 

Gross margin

 
 

541

 
 

 

 
 

252

 
 

 

 
 

97

 
 

 

 
 

(7)

 
 

 

 
 

2

 
 

 

 
 

-

 
 

 

 
 

885

 
 

Selling expenses

 
 

635

 
 

 

 
 

3

 
 

 

 
 

7

 
 

 

 
 

2

 
 

 

 
 

(5)

 
 

 

 
 

-

 
 

 

 
 

642

 
 

General and administrative expenses

 
 

38

 
 

 

 
 

2

 
 

 

 
 

2

 
 

 

 
 

2

 
 

 

 
 

60

 
 

 

 
 

-

 
 

 

 
 

104

 
 

Provincial mining taxes

 
 

-

 
 

 

 
 

57

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

57

 
 

Share-based compensation recovery

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

(32)

 
 

 

 
 

-

 
 

 

 
 

(32)

 
 

Other expenses

 
 

16

 
 

 

 
 

1

 
 

 

 
 

2

 
 

 

 
 

6

 
 

 

 
 

7

 
 

 

 
 

-

 
 

 

 
 

32

 
 

(Loss) earnings before finance costs and income taxes

 
 

(148)

 
 

 

 
 

189

 
 

 

 
 

86

 
 

 

 
 

(17)

 
 

 

 
 

(28)

 
 

 

 
 

-

 
 

 

 
 

82

 
 

Depreciation and amortization

 
 

155

 
 

 

 
 

96

 
 

 

 
 

150

 
 

 

 
 

63

 
 

 

 
 

9

 
 

 

 
 

-

 
 

 

 
 

473

 
 

EBITDA

 
 

7

 
 

 

 
 

285

 
 

 

 
 

236

 
 

 

 
 

46

 
 

 

 
 

(19)

 
 

 

 
 

-

 
 

 

 
 

555

 
 

Integration and restructuring related costs

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

10

 
 

 

 
 

-

 
 

 

 
 

10

 
 

Share-based compensation recovery

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

(32)

 
 

 

 
 

-

 
 

 

 
 

(32)

 
 

COVID-19 related expenses

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

2

 
 

 

 
 

-

 
 

 

 
 

2

 
 

Foreign exchange gain, net of

 
 
 

related derivatives

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

-

 
 

 

 
 

(27)

 
 

 

 
 

-

 
 

 

 
 

(27)

 
 

Adjusted EBITDA

 
 

7

 
 

 

 
 

285

 
 

 

 
 

236

 
 

 

 
 

46

 
 

 

 
 

(66)

 
 

 

 
 

-

 
 

 

 
 

508

 
 

Assets – at December 31, 2020 ¹

 
 

20,526

 
 

 

 
 

11,707

 
 

 

 
 

10,077

 
 

 

 
 

1,388

 
 

 

 
 

3,917

 
 

 

 
 

(423)

 
 

 

 
 

47,192

 
 

1 In 2021, certain assets related to transportation, distribution and logistics were reclassified under Corporate and Others as these are centrally managed. Depreciation expense related to these assets remains allocated to the rest of the segments based on usage.

 
 

Presented below is revenue from contracts with customers disaggregated by product line or geographic location for each reportable segment.

 
                                                                                                                      
 

 

 
 

  Three Months Ended  

 
 

 

 
 

  March 31  

 
 

 

 
 

  2021  

 
 

 

 
 

2020

 
 

  Retail sales by product line  

 
 

 

 
 

 

 
 

 

 
 

Crop nutrients

 
 

  1,016  

 
 

 

 
 

785

 
 

Crop protection products

 
 

  1,085  

 
 

 

 
 

1,010

 
 

Seed

 
 

  463  

 
 

 

 
 

394

 
 

Merchandise

 
 

  230  

 
 

 

 
 

216

 
 

Nutrien Financial

 
 

  25  

 
 

 

 
 

16

 
 

Services and other

 
 

  173  

 
 

 

 
 

255

 
 

Nutrien Financial elimination 1

 
 

  (20)  

 
 

 

 
 

(15)

 
 

 

 
 

  2,972  

 
 

 

 
 

2,661

 
 

  Potash sales by geography  

 
 

 

 
 

 

 
 

 

 
 

Manufactured product

 
 

 

 
 

 

 
 

 

 
 

North America

 
 

  442  

 
 

 

 
 

319

 
 

Offshore 2

 
 

  279  

 
 

 

 
 

292

 
 

 

 
 

  721  

 
 

 

 
 

611

 
 

  Nitrogen sales by product line  

 
 

 

 
 

 

 
 

 

 
 

Manufactured product

 
 

 

 
 

 

 
 

 

 
 

Ammonia

 
 

  188  

 
 

 

 
 

156

 
 

Urea

 
 

  274  

 
 

 

 
 

262

 
 

Solutions, nitrates and sulfates

 
 

  197  

 
 

 

 
 

196

 
 

Other nitrogen and purchased products

 
 

  196  

 
 

 

 
 

164

 
 

 

 
 

  855  

 
 

 

 
 

778

 
 

  Phosphate sales by product line  

 
 

 

 
 

 

 
 

 

 
 

Manufactured product

 
 

 

 
 

 

 
 

 

 
 

Fertilizer

 
 

  272  

 
 

 

 
 

221

 
 

Industrial and feed

 
 

  126  

 
 

 

 
 

120

 
 

Other phosphate and purchased products

 
 

  46  

 
 

 

 
 

42

 
 

 

 
 

  444  

 
 

 

 
 

383

 
 

1 Represents elimination for the interest and service fees charged by Nutrien Financial to Retail branches.

 
 

2 Relates to Canpotex Limited ("Canpotex") (Note 9).

 
 

  NOTE 3   SHARE-BASED COMPENSATION  

 

The following table summarizes the awards granted under our existing share-based compensation plans described in Note 5 of our 2020 annual consolidated financial statements:

 
                        
 

 

 
 

  Three Months Ended  

 
 

 

 
 

  March 31  

 
 

 

 
 

  2021  

 
 

 

 
 

2020

 
 

Stock options:

 
 

 

 
 

 

 
 

 

 
 

Granted (number of units)

 
 

  1,518,490  

 
 

 

 
 

2,293,802

 
 

Weighted average grant date fair value (US dollars)

 
 

  11.77  

 
 

 

 
 

7.18

 
 

Cash-settled share-based awards granted (number of units)

 
 

  1,198,148  

 
 

 

 
 

1,278,324

 
 

  NOTE 4   OTHER (INCOME) EXPENSES  

 
                                        
 

 

 
 

  Three Months Ended  

 
 

 

 
 

  March 31  

 
 

 

 
 

  2021  

 
 

 

 
 

2020

 
 

Integration and restructuring related costs

 
 

  10  

 
 

 

 
 

10

 
 

Foreign exchange loss (gain), net of related derivatives

 
 

  2  

 
 

 

 
 

(31)

 
 

Earnings of equity-accounted investees

 
 

  (20)  

 
 

 

 
 

(10)

 
 

Bad debt expense

 
 

  2  

 
 

 

 
 

6

 
 

COVID-19 related expenses

 
 

  9  

 
 

 

 
 

2

 
 

Impairment of assets

 
 

  4  

 
 

 

 
 

-

 
 

Other expenses

 
 

  14  

 
 

 

 
 

55

 
 

 

 
 

  21  

 
 

 

 
 

32

 
 

  NOTE 5   INCOME TAXES  

 

A separate estimated average annual effective income tax rate was determined for each taxing jurisdiction and applied individually to the interim period pre-tax earnings for each jurisdiction.

 
                        
 

 

 
 

  Three Months Ended  

 
 

 

 
 

  March 31  

 
 

 

 
 

  2021  

 
 

 

 
 

2020

 
 

Income tax expense (recovery)

 
 

  25  

 
 

 

 
 

(16)

 
 

Actual effective tax rate on earnings/loss (%)

 
 

  16  

 
 

 

 
 

37

 
 

Actual effective tax rate including discrete items (%)

 
 

  16  

 
 

 

 
 

32

 
 

Discrete tax adjustments that impacted the tax rate

 
 

  -  

 
 

 

 
 

2

 
 

Income tax balances within the condensed consolidated balance sheets were comprised of the following:

 
                                                       
 

Income Tax Assets and Liabilities

 
 

Balance Sheet Location

 
 

  As at March 31, 2021  

 
 

 

 
 

As at December 31, 2020

 
 

Income tax assets

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Current

 
 

Receivables

 
 

  373  

 
 

 

 
 

83

 
 

Non-current

 
 

Other assets

 
 

  89  

 
 

 

 
 

305

 
 

Deferred income tax assets

 
 

Other assets

 
 

  249  

 
 

 

 
 

242

 
 

Total income tax assets

 
 

 

 
 

  711  

 
 

 

 
 

630

 
 

Income tax liabilities

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Current

 
 

Payables and accrued charges

 
 

  79  

 
 

 

 
 

48

 
 

Non-current

 
 

Other non-current liabilities

 
 

  42  

 
 

 

 
 

40

 
 

Deferred income tax liabilities

 
 

Deferred income tax liabilities

 
 

  3,168  

 
 

 

 
 

3,149

 
 

Total income tax liabilities

 
 

 

 
 

  3,289  

 
 

 

 
 

3,237

 

 

 
 

  NOTE 6   FINANCIAL INSTRUMENTS  

 

   Fair Value   

 

Estimated fair values for financial instruments are designed to approximate amounts for which the instruments could be exchanged in a current arm's-length transaction between knowledgeable, willing parties. The valuation policies and procedures for financial reporting purposes are determined by our finance department. There have been no changes to our valuation methods presented in Note 10 of the 2020 annual consolidated financial statements and those valuation methods have been applied in these interim financial statements.

 

The following table presents our fair value hierarchy for financial instruments carried at fair value on a recurring basis or measured at amortized cost:

 
                                                                                                                                                                                                           
 

 

 
 

  March 31, 2021  

 
 

 

 
 

December 31, 2020

 
 

 

 
 

  Carrying  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Carrying

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  Financial assets (liabilities) measured at  

 
 

  Amount  

 
 

 

 
 

  Level 1 1  

 
 

 

 
 

  Level 2 1  

 
 

 

 
 

  Level 3  

 
 

 

 
 

Amount

 
 

 

 
 

Level 1 1

 
 

 

 
 

Level 2 1

 
 

  Fair value on a recurring basis  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Cash and cash equivalents

 
 

  712  

 
 

 

 
 

  -  

 
 

 

 
 

  712  

 
 

 

 
 

  -  

 
 

 

 
 

1,454

 
 

 

 
 

-

 
 

 

 
 

1,454

 
 

Derivative instrument assets

 
 

  41  

 
 

 

 
 

  -  

 
 

 

 
 

  41  

 
 

 

 
 

  -  

 
 

 

 
 

45

 
 

 

 
 

-

 
 

 

 
 

45

 
 

Other current financial assets

 

- marketable securities 2

 
 

  166  

 
 

 

 
 

  24  

 
 

 

 
 

  142  

 
 

 

 
 

  -  

 
 

 

 
 

161

 
 

 

 
 

24

 
 

 

 
 

137

 
 

Investments at FVTOCI 3

 
 

  211  

 
 

 

 
 

  201  

 
 

 

 
 

  -  

 
 

 

 
 

  10  

 
 

 

 
 

153

 
 

 

 
 

153

 
 

 

 
 

-

 
 

Derivative instrument liabilities

 
 

  (43)  

 
 

 

 
 

  -  

 
 

 

 
 

  (43)  

 
 

 

 
 

  -  

 
 

 

 
 

(48)

 
 

 

 
 

-

 
 

 

 
 

(48)

 
 

  Amortized cost  

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Current portion of long-term debt

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Fixed and floating rate debt

 
 

  (14)  

 
 

 

 
 

  -  

 
 

 

 
 

  (14)  

 
 

 

 
 

  -  

 
 

 

 
 

(14)

 
 

 

 
 

-

 
 

 

 
 

(14)

 
 

Long-term debt

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

Notes and debentures

 
 

  (9,991)  

 
 

 

 
 

  (7,994)  

 
 

 

 
 

  (3,177)  

 
 

 

 
 

  -  

 
 

 

 
 

(9,994)

 
 

 

 
 

(3,801)

 
 

 

 
 

(7,955)

 
 

Fixed and floating rate debt

 
 

  (49)  

 
 

 

 
 

  -  

 
 

 

 
 

  (49)  

 
 

 

 
 

  -  

 
 

 

 
 

(53)

 
 

 

 
 

-

 
 

 

 
 

(53)

 
 

1 During the periods ended March 31, 2021 and December 31, 2020, there were no transfers between Level 1 and Level 2 for financial instruments measured at fair value on a recurring basis.

 
 

2 Marketable securities consist of equity and fixed income securities. We determine the fair value of equity securities based on the bid price of identical instruments in active markets. We value fixed income securities using quoted prices of instruments with similar terms and credit risk.

 
 

3 Investments at fair value through other comprehensive income ("FVTOCI") is primarily comprised of shares in Sinofert Holdings Ltd.

 

 

 
 

  NOTE 7   SHARE CAPITAL  

 

   Share repurchase programs   

 
                                                             
 

 

 
 

 

 
 

 

 
 

 

 
 

 

 
 

  Maximum  

 
 

 

 
 

  Maximum  

 
 

 

 
 

  Number of  

 
 

 

 
 

  Commencement  

 
 

 

 
 

 

 
 

 

 
 

  Shares for  

 
 

 

 
 

  Shares for  

 
 

 

 
 

  Shares  

 
 

 

 
 

  Date  

 
 

 

 
 

  Expiry  

 
 

 

 
 

  Repurchase  

 
 

 

 
 

  Repurchase (%)  

 
 

 

 
 

  Repurchased  

 
 

2019 Normal Course Issuer Bid

 
 

February 27, 2019

 
 

 

 
 

February 26, 2020

 
 

 

 
 

42,164,420

 
 

 

 
 

7

 
 

 

 
 

33,256,668

 
 

2020 Normal Course Issuer Bid

 
 

February 27, 2020

 
 

 

 
 

February 26, 2021

 
 

 

 
 

28,572,458

 
 

 

 
 

5

 
 

 

 
 

710,100

 
 

2021 Normal Course Issuer Bid 1

 
 

March 1, 2021

 
 

 

 
 

February 28, 2022

 
 

 

 
 

28,468,448

 
 

 

 
 

5

 
 

 

 
 

14,978

 
 

1 The 2021 normal course issuer will expire earlier than the date above if we acquire the maximum number of common shares allowable or otherwise decide not to make any further repurchases.

 
 

Purchases under the normal course issuer bids were, or may be, made through open market purchases at market prices as well as by other means permitted by applicable securities regulatory authorities, including private agreements.

 

The following table summarizes our share repurchase activities during the period:

 
                    
 

 

 
 

  Three Months Ended  

 
 

 

 
 

  March 31  

 
 

 

 
 

  2021  

 
 

 

 
 

2020

 
 

Number of common shares repurchased for cancellation

 
 

  14,978  

 
 

 

 
 

3,832,580

 
 

Average price per share (US dollars)

 
 

  52.93  

 
 

 

 
 

41.96

 
 

Total cost

 
 

  1  

 
 

 

 
 

160

 
 

   Dividends declared   

 

We declared a dividend per share of $0.46 (2020 – $0.45) during the three months ended March 31, 2021, payable on April 15, 2021 to shareholders of record on March 31, 2021.

 

   Anti-dilutive shares   

 

As we recorded a net loss for the three months ended March 31, 2020, all stock options had an anti-dilutive effect. If we had net earnings, the diluted weighted average shares calculation would have included 66,806 stock options for the three months ended March 31, 2020.

 

  NOTE 8   SEASONALITY  

 

Seasonality in our business results from increased demand for products during planting season. Crop input sales are generally higher in spring and fall application seasons. Crop input inventories are normally accumulated leading up to each application season. The results of this seasonality have a corresponding effect on receivables from customers and rebates receivables, inventories, prepaid expenses and other current assets and trade payables. Our short-term debt also fluctuates during the year to meet working capital needs. Our cash collections generally occur after the application season is complete, while customer prepayments made to us are typically concentrated in December and January and inventory prepayments paid to our vendors are typically concentrated in the period from November to January. Feed and industrial sales are more evenly distributed throughout the year.

 

  NOTE 9   RELATED PARTY TRANSACTIONS  

 

We sell potash outside Canada and the United States exclusively through Canpotex. Canpotex sells potash to buyers in export markets pursuant to term and spot contracts at agreed upon prices. Our revenue is recognized at the amount received from Canpotex representing proceeds from their sale of potash, less net costs of Canpotex. Sales to Canpotex are shown in Note 2.

 
        
 

As at

 
 

  March 31, 2021  

 
 

 

 
 

December 31, 2020

 
 

Receivables from Canpotex

 
 

  161  

 
 

 

 
 

122

 
 

 

 

  

  

  Investor Relations:  
Richard Downey
Vice President, Investor Relations
(403) 225-7357
Investors@nutrien.com  

 

Tim Mizuno
Director, Investor Relations
(306) 933-8548

 

  Media Relations:  
Megan Fielding
Vice President, Brand & Culture Communications
(403) 797-3015

 

News Provided by Business Wire via QuoteMedia

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