Nutrien posts 4Q19 financial results

Highlights

• Nutrien generated US$2.2 billion in free cash flow in 2019, up 9% over last year, and US$2.6 billion in free cash flow including changes in non-cash working capital in 2019, which is over three times higher than in 2018.
• Nutrien recorded a number of charges totalling US$128 million this quarter related to mergers, acquisitions and impairments, the largest associated with the rebranding of the Australian retail business after the Ruralco acquisition.
• Retail performed well as EBITDA increased 8% in 4Q19 and 2% in the full year 2019, compared to the same periods in 2018. Nutrien’s sales, service and supply chain strength helped to grow market share and the company expect strong EBITDA growth in 2020 due to contributions from acquisitions, improved market conditions and organic growth.
• Potash EBITDA was down 62% in 4Q19 compared to the same period in 2018 due to lower sales volumes and lower net realised selling prices caused by a temporary reduction in global demand, the impact of production downtime and the Canadian National Railway labour strike. 2019 potash adjusted EBITDA was similar to 2018 as higher average net realised selling prices were mostly offset by lower sales volumes.
• Nitrogen EBITDA in 4Q19 was 19% lower than the same period last year due primarily to lower ammonia sales volumes and a lower nitrogen net realised selling price. Nitrogen EBITDA in 2019 increased 2% compared to 2018 as lower natural gas costs in North America more than offset higher natural gas costs in Trinidad, and higher earnings from equity-accounted investees and the impact of IFRS 16 more than offset lower ammonia sales volumes and lower nitrogen net realised selling prices.
• In 4Q19, Nutrien increased the maximum number of common shares that may be acquired under its current normal course issuer bid (NCIB) to approximately 7% of the outstanding common shares. Nutrien repurchased an aggregate of 36 million common shares in 2019 and 72 million common shares over the past 24 months.
• Nutrien full-year 2020 adjusted net earnings per share and adjusted EBITDA guidance is US$1.90 to US$2.60 per share and US$3.8 to US$4.3 billion, respectively.

“Nutrien’s earnings held up well in 2019 and we generated strong free cash flow in a very tough agriculture market. We executed on our strategic plan, growing our Retail business with several strategic acquisitions and made great strides with the roll-out and adoption of our leading Retail digital platform and financial tools. Agriculture fundamentals are strengthening and grower sentiment is positive. We expect higher planting and favourable farm economics to support strong North American crop input demand in 2020,” commented Chuck Magro, Nutrien’s President and CEO.

“Our business is designed to provide stability in times of market weakness, with significant leverage through a recovery in fertilizer markets. We remain focused on optimising our network, allocating capital to grow our Retail business and leading our industry in returning capital to shareholders,” added Magro.

Read the article online at: https://www.worldfertilizer.com/nitrogen/19022020/nutrien-posts-4q19-financial-results/