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Sep 30, 2023
CF Industries Q3 2023 Earnings Report
CF Industries experienced solid results underpinned by strong North American demand and favorable energy spreads.
Key Takeaways
CF Industries reported net sales of $1.273 billion and a net earnings attributable to common stockholders of $164 million, or $0.85 per diluted share, for the third quarter of 2023. Adjusted EBITDA for the quarter was $445 million. The company returned approximately $900 million to shareholders over the last twelve months and is progressing with its clean energy initiatives and the acquisition of the Waggaman ammonia production complex.
Low nitrogen channel inventories drive strong North American demand.
Returned ~$900 million to shareholders over LTM.
Waggaman acquisition expected to close December 1, 2023.
Advanced our clean energy initiatives.
CF Industries
CF Industries
Forward Guidance
Global nitrogen market expected to remain favorable for remainder of 2023 and into 2024. Energy differentials between North America and marginal producers in Europe and Asia remain well - above historical levels
Positive Outlook
- Robust global demand along with lower production due to global turnaround activity and continued challenging natural gas fundamentals in key regions, such as Europe and Trinidad, tightened the global nitrogen - supply demand balance, supporting an increase in global nitrogen prices late in the third quarter
- North American channel inventories remain below average due to lower import levels and higher export volumes year - to - date
- Europe unfavorable producer economics driven by higher forecast natural gas prices in the region continue to favor nitrogen imports
- India urea demand is expected to remain stable, underpinned by robust agricultural production
- Brazil demand for urea is expected to be strong through its growing season supported by high planted corn acres and healthy farm incomes
Challenges Ahead
- Chinese urea exports are expected to be lower as the Chinese government reinstated measures to limit exports
- Russian exports of ammonia remain lower while other nitrogen products are at pre - war levels
- Estimated 20 - 30% of European ammonia capacity curtailed as production costs driven by energy costs remain higher than global ammonia spot prices
- Global nitrogen cost curve will remain supportive of significant margin opportunities for low - cost North American producers
- North American channel inventories remain below average due to lower import levels and higher export volumes year - to - date