Agrium braces for earnings at low end of guidance range
Canadian fertilizer producer Agrium Resources is warning that its fourth-quarter earnings will be at the bottom end of its guidance range of 80 cents to $1.25 per share.
The result won't surprise many considering that potash prices plummeted over the past year. In a statement issued Monday evening, the company said weak prices, lower than expected sales volumes and challenges with domestic rail shipments were all contributors.
In September the fertilizer giant also warned of a steep drop-off in sales ahead of its third quarter results. The news dragged its share price down by nearly 3%. Net earnings did indeed drop, from $129 million in Q3 2012 to $76 million in Q3 2013.
Meanwhile, Agrium said on Monday that it expects record results for its retail operations.
"Retail was able to offset industry headwinds of lower nutrient prices and a compressed fall season in the U.S. by achieving higher margins for nutrients, seed and services and other product lines," the company wrote.
Agrium is a major retail supplier of agricultural products and services in North and South America. The company has one potash mine in Saskatchewan.
Despite the major drop in global potash prices over the past year, Agrium said last month that it would not lay off staff, the Globe and Mail reported. Meanwhile, competitor Potash Corp has said it will slash more than 1,000 jobs.