The Mosaic Company (NYSE: MOS), reported net income of $369 million, or $1.11 per diluted share, for the second quarter of 2023.
Adjusted EPS(1) was $1.04 and Adjusted EBITDA(1) was $744 million. Gross margin was $571 million.
'The investments we've made in our business over the last decade are yielding results,' said President and CEO Joc O'Rourke. 'Our Esterhazy potash complex is now the largest in the world and our Fertilizantes business in Brazil accounts for nearly a quarter of all fertilizer sales in one of the most dynamic ag markets in the world. Mosaic is well positioned to capitalize on the fertilizer market's recovery, which is well underway.'
Highlights
Second quarter revenues totaled $3.4 billion, down 37 percent from the year ago period, reflecting the impact of lower selling prices. The gross margin rate in the second quarter was 16.8 percent, down from 34.4 percent in the year ago period.
Net Income in the second quarter totaled $369 million, compared with $1.0 billion in the year ago period. Adjusted EBITDA(1) totaled $744 million, compared with $2.0 billion in the second quarter of 2022. Cash from operating activities totaled $1.1 billion and free cash flow(1) totaled $197 million. This compares to $1.6 billion and $794 million, respectively, in the year ago period.
Potash operating earnings were $328 million in the second quarter, compared to $915 million last year. Adjusted EBITDA(1) totaled $408 million, compared to $998 million in the same period last year, reflecting the impact of lower prices. In July, we restarted the Colonsay potash mine to mitigate the short-term impact of reduced output related to planned summer maintenance at the Esterhazy potash complex and help manage inventory levels. During the second quarter, total nameplate capacity at our Esterhazy operations was independently validated by a third party to be 7.8 million tonnes.
Phosphate operating earnings were $146 million in the second quarter, compared to $578 million in the prior year period. Adjusted EBITDA(1) totaled $385 million, compared to $758 million in the second quarter of 2022. Segment results reflected the impact of lower prices and higher conversion costs, somewhat offset by the benefit of declining raw material costs.
Mosaic Fertilizantes reported an operating loss of $20 million in the second quarter, compared to positive $420 million in the prior year period. Adjusted EBITDA(1) totaled positive $66 million during the quarter, down from $444 million in the second quarter of 2022. Second quarter results reflected the impact of lower pricing for both the production and distribution businesses, compared to the same period last year.
About The Mosaic Company
The Mosaic Company is one of the world's leading producers and marketers of concentrated phosphate and potash crop nutrients. Mosaic is a single source provider of phosphate and potash fertilizers and feed ingredients for the global agriculture industry. More information on the company is available at www.mosaicco.com. Mosaic has posted prepared comments and related slides on its website, www.mosaicco.com/investors, concurrently with the posting of this release and performance data. In addition, the company will provide access to a fireside chat addressing questions on the quarter, current market conditions, and other topics on Wednesday, August 2, 2023, at 11 am Eastern. The fireside chat will be available both on the website and via telephone at the following number: 412-902-6506, Conference ID: 2580806 . All earnings-related material, including audio, will be available up to one year from the time of the earnings call.
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may include, but are not limited to, statements about proposed or pending future transactions or strategic plans and other statements about future financial and operating results. Such statements are based upon the current beliefs and expectations of The Mosaic Company's management and are subject to significant risks and uncertainties. These risks and uncertainties include, but are not limited to: political and economic instability and changes in government policies in Brazil and other countries in which we have operations; the predictability and volatility of, and customer expectations about, agriculture, fertilizer, raw material, energy and transportation markets that are subject to competitive and other pressures and economic and credit market conditions; the level of inventories in the distribution channels for crop nutrients; the economic impact and operating impacts of the coronavirus (Covid-19) pandemic, the effect of future product innovations or development of new technologies on demand for our products; changes in foreign currency and exchange rates; international trade risks and other risks associated with Mosaic's international operations and those of joint ventures in which Mosaic participates, including the performance of the Wa'ad Al Shamal Phosphate Company (also known as MWSPC), the future success of current plans for MWSPC and any future changes in those plans; difficulties with realization of the benefits of our natural gas based pricing ammonia supply agreement with CF Industries, Inc., including the risk that the cost savings initially anticipated from the agreement may not be fully realized over its term or that the price of natural gas or ammonia during the term are at levels at which the pricing is disadvantageous to Mosaic; customer defaults; the effects of Mosaic's decisions to exit business operations or locations; changes in government policy; changes in environmental and other governmental regulation, including expansion of the types and extent of water resources regulated under federal law, carbon taxes or other greenhouse gas regulation, implementation of numeric water quality standards for the discharge of nutrients into Florida waterways or efforts to reduce the flow of excess nutrients into the Mississippi River basin, the Gulf of Mexico or elsewhere; further developments in judicial or administrative proceedings, or complaints that Mosaic's operations are adversely impacting nearby farms, business operations or properties; difficulties or delays in receiving, increased costs of or challenges to necessary governmental permits or approvals or increased financial assurance requirements; resolution of global tax audit activity; the effectiveness of Mosaic's processes for managing its strategic priorities; adverse weather conditions affecting operations in Central Florida, the Mississippi River basin, the Gulf Coast of the United States, Canada or Brazil, and including potential hurricanes, excess heat, cold, snow, rainfall or drought; actual costs of various items differing from management's current estimates, including, among others, asset retirement, environmental remediation, reclamation or other environmental regulation, Canadian resources taxes and royalties, or the costs of the MWSPC; reduction of Mosaic's available cash and liquidity, and increased leverage, due to its use of cash and/or available debt capacity to fund financial assurance requirements and strategic investments; brine inflows at Mosaic's potash mines; other accidents and disruptions involving Mosaic's operations, including potential mine fires, floods, explosions, seismic events, sinkholes or releases of hazardous or volatile chemicals and risks associated with cyber security, including reputational loss; as well as other risks and uncertainties reported from time to time in The Mosaic Company's reports filed with the Securities and Exchange Commission. Actual results may differ from those set forth in the forward-looking statements.
Contact:
Media Ben Pratt
Tel: 813-775-4206
Email: benjamin.pratt@mosaicco.com
THE MOSAIC COMPANY 
