The Mosaic Company (MOS) 2 Aug 222022 Q2 Earnings call transcript

Good morning, ladies and gentlemen, and welcome to The Mosaic Company Second Quarter 2022 Earnings Conference Call. At this time, all participants have been in a listen-only mode. After the company completes their prepared remarks, the lines will be open to take your questions.

Your host for today's call is Paul Massoud, Vice President of Investor Relations and Financial Planning and Analysis of the company -- of The Mosaic Company. Mr. begin. may you Massoud,

as welcome and will second your be O'Rourke, be Officer, of and Marketing, fireside Chief and Freeland, Strategic Q&A. call. Vice Global Wang, Senior President XXXX to Senior Opening available questions. Executive President chat a by comments provided Financial followed also as to you answer open quarter Clint Officer; our Chief earnings and well Jenny Thank will by President Joc Vice

that statements forward-looking those results are of differ filed and press making management's our be this statements conference future uncertainties. Actual results to with but will We the expectations operating may today's in on include, release Statements during in are Securities differ subject included are Factors cause significant not materially furnished to about could materially as in call. from and beliefs reports and based statements the to, results. from risks are limited forward-looking date and results. our Commission. and financial yesterday actual and Exchange projected They

presenting also certain financial measures. be will We non-GAAP

Our non-GAAP contain and data information measures. on performance press important release these also

to over call turn like to Joc. I'd Now, the

to discussion. our as share we earnings to $X a provide review you of on website totaled bringing second I through $X of during Thank XXXX flow last will earnings net adjusted live delivered billion. repurchases, which because made July into shareholders before share news aggressively million return and Adjusted us Mosaic and $XXX the through per questions data, rest portfolio to and chance the XXXX. year million we $XXX and EBITDA received flow We've strong session. quarter total were June year-to-date then as the positions $X.XX buy billion. Good morning. were billion cash through $X.XX. context allowing yesterday. XXth $X quarter, respond we hope second $XXX us back share conclude to per including Q&A more continued available night, over to million, we'll the release our a cash second with Free continue our our was significant quarter believe of had for well joining to you've results I slides shares driving earnings our to posted and performance generating additional buyback of income and

Mosaic's this exhausted once such, Directors begin is of approved $X share one the Board new billion year. As later has repurchase authorization current a to

markets. are Before important global most our uncertainty There digging deeper into discuss of one threatening in continues producers. Ukraine crop several food supply security. issues business, The around world's broader agricultural war the create the let's from food to

is of global for temperatures, into demand this, are Europe a together, overall all But and supply and US lower these Each ratios, XX-year lows, at Because this Southern remain under issues of already oilseeds XXXX alone very is applications XXXX. This through security global production. will nutrient conditions. Brazil experienced happening while addition, have of of have drought And effect global of on signs In a of material time a because showing high supply. near can food we stock-to-use suggests and significant. the crop to and grains which continuing scenario pressure. is risk see tight constrained

down year. this to remain to and strong. be quite X As fundamentals tonnes million expect we fertilizer the exports potash potash, focus on Belarusian the markets, continue In phosphate we

the of from was total as down shortfall about restrict believe believe of demand. period supporting in has million it be In last demand In that will far now phosphates, supply volatile year, prices North of supply. compressed to tonnes. unfilled year. consumption. supply. from million and of exports season, rest XX half not exports We months. mitigated supply the thus much Some enough full world which incremental XXXX the much least prioritizes we China well that like be result phosphate as of impact the Brazil a tonnes fertilizer at prices first by supplied believe 'XX, the planting crop But the of as be more been margins producers at could demand macroeconomic industrial a have of levels, deficit and the has we over that see aligns a to is continue well historical in and North grown both potash continued XXXX the erase with America, to well down Shifting sentiment least. continuing and But Mosaic China constraints focus, we've situation spring year the from into global seen agricultural cautious. prior see are will next XX% rest in as through domestic lasting XX.X Grower year of same global limited above from and X but phosphates America headwinds we season will the

remained First XXXX, levels. record year in-line half but down the historic applications from with in were

India, Looking saw concerns government strong supply for indicate as first the Asia, In underway. a market application these application. enter In stemming China, will domestic ensure nutrients importers leading this consumption. and though, prepays, when we've demand X potash below Brazil, Southeast availability are demand price adequate driven importers million the very take inventories and Farmer of to we supply below improves. with historic port customer shipments of reduced and from tonnes years potash In supply will beyond see phosphate. farmer will expect up We in in see in impacting normal levels. half by geopolitical XXXX built demand we in-line it softer phosphate country future pullback over ramp require sit recent catch-up year forward, the India's season Channel demand by as low appear begun up and fall inventories of inventories in were concerns for persist. over indicate availability historic to gets Significant events. the continues levels. availability to advantage demand remains dynamics

today's our the the the seen now to XX repaid in today's We've XXXX having Fertilizantes to over completely million global issued less recapitalized we decade all at investments back last XXXX of EBITDA And grow driven the the of all Brazil, optimistic. context The business made than look acquisition environment. remain in the $XX the we've and for of well last deal. fund In proforma from $X.X business, billion has that of borrowing business shares we bought As us significant have our over positioned we've value. markets, shareholder months.

continue benefit its position as from the Fertilizantes to second-largest Mosaic, forward, and market largest country's Looking producer will distributor.

are impact. asset. reached an X.X plan seeing believe our year restarting advantaged incremental second we're structure, in process phosphates, the X In XXXX. and resulting target new optimization we've begun continue to production KX, for ammonia rate our that We flow our by that to of inflation of second which now the mines in sustainable to initial we much levels moderate million in we're our the from one of We've improvement of complex operating continue underground our working believe addition year, should At in seeing the potash, In million to the run costs world's should later first the mill, of but offset this we year of and quarter actively with tonnes per of benefits we tonnes optimize through optimization the and over the the capacity. of end at next Colonsay, benefit tonnes to to should the most realizing X sulfur output the potash down year. expand are half production an begin are We've of of of position cost efficient to year. the ongoing miners prices rest the costs three per seen million

levels. margins stripping our remain expect will historic we result, a well above As

the business flow generate, the us. focus and remains capital we allocation Given for key our expect for to free a outlook cash

business. invest First, in our to continue we

Brazil, For interested unchanged capital but $X.X small total at remain large-scale bolt-on modest, to not in are we high-returning remain projects, in projects. billion. expenditures acquisitions, and We greenfield XXXX, especially open

Second, after half of the $XXX further strong committed no to need a retire plan in million to XXXX, see debt second and ensuring we we're balance to which, deleverage. of sheet long-term

of that XXX% pace the expect returning $X.X capital returned is to total, we shareholders. and as The free to shares provides $X authorization. commitments current not use return valuation, flow the continue, dividends expect and essentially the of after of strategy billion cash economics end authorization third business Year-to-date, if we to and of to accelerate, we our any shareholders of we've Directors than today's new our progresses. a once our we've pillar cash. authorization, billion to our through In year buybacks our we're exhausted approaching balance buying back that own begins At the current Because approved discussed. Board of other the better sheet the

expect to advantage with we long consider We the as special this over opportunity So, take may conditions. time as dividends repurchases on share also supplementing remains. market depending of

past, in for sake cash we balance build not of will the the As the we've just said on it. sheet

we strengthening we me still help customer business it results returning by favorable investing our Q&A, as strong we're into to continue to and while continuing significant going the ensuring capital shareholders, the through sheet. year met, Before the second XXXX. food We're are summarize. quarter balance demands dynamics the the into allow expect and in and very grow and Mosaic world delivered needs to in

with the on portion call. Q&A of to would the to I Now, that, move like

like questions an in last the materials As it after phosphate we've done on in past provide helpful quarters, constraints. received of Joc, just we are I address most might our What be some to we potash supply and to we market published earnings the to night. seeing start, common today? update think we'd

Thank you, Paul.

to of be and potash. we tonnes this about effect with start expect to Russian The XX year by Belarusian the down together due exports million Let's sanctions.

expect do Belarusian next move into those need XXXX, over world and exports we the any if back in recovery to we snaps the but going tonnes way demand both as year. Russian is Now, from

the Probably market. They're in rail. Central product by we comeback. market. are to Brazil, other India, countries easier to than do They we're moving and particularly ways China seeing We're like little their the in But seeing very see month Belarus come through where little back. has America. tonnes, tonnes Belarusian finding very So, had a Russia? of XXX,XXX that, into probably

between been expect we the terms player, of the is those second at have start, in of XX the year. phosphates, the tonnes. said million of and export I like the of into In restrictions, China them, extended biggest course, So two half

Our down million year to tonnes Chinese XX.X million this tonnes. is seven-ish projection exports for from

And them expect even to we don't So the come we're changes structural the reduction really restrictions in end. after five tonne China, big because again, of exports. back a way million good of seeing a in

ag and to restrict domestic expect we exports. industrial demand So to XXXX, in continue Chinese

the second you the phosphate playing quarter, we we saw discuss second in dynamics questions see received Given demand. half potash out? Can the several and the of how on resiliency you

saying, because had Let of demand of me saw phosphates of areas, the supply meant was start to areas. what lack use different supply lack demand rationing by And be but rationed. lower some potash, in specifically in of that we and in both

season played regional it's in this In America compressed and led weather because of spring how ground. fertilizer the So North to ability to out. very late very limited add very particularly, to a

be application combined this, in next to But probably will of because soil led remember, growers up mine any seasons. to this of to their prices, with curtailed Canada. States of United the higher couple have and willing the in So the missed use lower made or being

a we application. do very robust normal expect fall So

caveat so be late. because will late again, the harvest the late, was it be will there Now being, planting

and But the very I cross quarters quarter. with line from in if year of year, third into half expect quarter at the overall Canada. a in could the to the here be it we normal look the So it second much fourth in

questions few will And specifically potash. levels on do how impact Brazil, you in a inventory new How received affect this might think elevated we also sales? pricing? Joc, around this

you. Thank

there the country to President whether not of fertilizer was would start a over the the point, Brazil Brazil, available fertilizer to for or needed could both with imports To the the ensure imported. start huge Brazil. that the we put concern for it the to Agriculture And country understanding and be constrained supply travel XX% at its year, the Minister into the get of have is that As it of planting. we by a of world discuss

first half for the As such, Brazil pricing led in the around year of world. the

imports of because half. that, were in XX% the about up Now year-over-year first

economics believe start end normal the because the this move high, the farmers which second for can they right of high the at are apply applying, we the ultimately, evidence both So buy, crop inventory, believe farmer are into apply. of of And as the fertilizer. we indicates are will the the defer. year, prepay to to But half when second will consume is perspective farmers activity getting that soybeans the they ramp-up best corn solid to high. to inventories inventories have a last year They are are quarter, And waiting farmers buying drive we going our for the the that and we time. place. just from ready seen The are getting ready and in

few some potash around analysts sales quarter about phosphates received the from We for expectations Can questions both and volume you three for provide third a phosphates. especially our over months? guidance, next context our

Thank Yes. you.

a late issue. going to harvest. North planting and timing a mostly the is spring this saying by start late lead In is America, late to me Let

means line with to the be third it could harvest. in this that rather the delayed fourth demand, that half come quarter in second should quarter expectation, the Now while than due

So a the half, expect planting second while it or happen for corn November, out won't plays yet In soybeans very of until we the is seen. December. in the timing normal be Brazil, where to terms exactly crop second

As purchases minute. such, delay time for their is there the them to until last

Now again, with the half year. second purchase just deferring as we North expect late they the normal like always, as can. application in as of higher But are America, people prices, the in Brazil,

application we economics will good mean both that However, will normal cases, occur. in believe

align typical more fourth historically, the does sales range for quarter. phosphate could we into If guidance you the see high those again, but with slipping the note do

see Clint, this few going you. question playing last a our question that on forward? received is for in you out capital How needs We the working do quarters.

good and Paul, morning, Thanks, everyone.

As dynamics working we there mind. look a to number keep at capital, in of are

seasonality particularly statement that First, and sheet, impact our our around income also capital. pricing working levels the overall market balance impact

caused pricing our of payables. accounts and couple in years, As the that inventories we've seen an the levels overall market capital core working the receivables, has and last increase over increase of

happening the that, a So of capital the with what's the overall as environment. couple overall last result the needs those tend business to pricing of directionally follow of we've working increase. over again, seen And years

environment Now in in, addition to business the operating have we're the pricing of impact of seasonality plays we the our that that also out.

we're either from or And quarter-to-quarter based which on some so entering see changes you into. meaningful in season

preparation we the quarter, First for see tend to spring season.

the inventory typically see We out. build. our we capital. So -- receivables and year And we see working into previous we of typically from get see then tend paid accruals tend to builds. quarter, other payables move We impacts as see to the on second

moves particularly season. business and So out the as growing are will Brazil through accounts, then liquidate particularly the it as particularly and it things, the – tends bit capital distribution quite inventory, recall, think, a our move we it I of Brazil. in it our or to One tend Two we to throughout seasons relates as focus in play the North working into is does in seasons to see in hold good on Brazil. certainly season, to can America the to

working of So our that of some can be capital. driver a overall

order the The see of the other And of of saw by prepayments Prepayments Brazil give half would in to you third of And that quarter, working magnitude, the to sense influenced is of year, the element all year. expect the of back somewhere in the out increase reverse the tend capital. of factor Brazil half between about it, in of $XXX specifically, around the a if the that, out then of just reverse second expect vast this million. prepayments. the of would year. business out another half half year we first Again, overall to and XX% first in we XX% But to that's in by I environment. number again, majority pricing that's to not reverse of build

working impacts our capital, you environment as the at of keep it, look pricing seasonality underlying but business. again, mind, in just our also So overall

concludes questions. of portion follow-up the open Operator, That let's the fireside chat call. the up

question. take Instructions] will first now [Operator We our

ahead. open. go is line Please Your

to down Joc, looking at? Bank largely Fertilizantes I'd you Byrne, And your get can gross produce how you you where and you product mentioned you you in between also differ see you on some view were small there. versus business What the that businesses America. forward of take Steve comment capacities? here. from bolt-ons margins you looking are your on potentially do that like you changing perhaps buy redistribute? split Do that expand product as going then at

section at of you year. but Amazon, Okay. the be as not probably Thanks, start It area as seems plus the probably go per Brazil, to growing the kind the It's by me obviously. Northeast Brazil, Steve. XX% at saying, into look fastest. growing of Look, or Northwest we towards, let that’s

would that plans a to be We more region. us have hub to allow build in that participative

So we as to optimizing distribution operations. supply. potash production, in life plans then existing our got there business. expand where We're the niche facility for area of expand down And because one our looking we've where the that market grows, plans to would think it our area extend we areas that's expect can of a it's and at

there quick relatively opportunities that paybacks a requirements. limited going there's at capital have number very and of we think looking So, we're to down are

of then hand, constant that both the is for distribution best explicit though, up are year-on-year. margin is US say, Brazil. our producer the in production the seen terms In retail about and pick – distribution the I'll like of benefit margins very split and be not are distribution down margins MicroEssentials, too we the to we what on in margin type where that, our things Where the actual margins, margin market margins business margins. our at of But the clearly better than this stay other

then and are those other where are and both the is sell of we our production capture our through So pretty margins. fantastic the place really those distribution margins it business, good BXB we margins own where

-- but production I -- now, the two-thirds of probably driven overall, our business. So think earnings our -- being our by are right

take can our is we Please, Now, go question. open. line now your Caller ahead. next

Hi. Joel Jackson BMO. from

Just margins margin fertilizer I up been question in bunch place see over we should I'm environment. following seeing to Fertilizantes the down. how have of on have right the margin some all quarters a peak go the margins rising mean, Brazil last price question. assuming Obviously, we're of or there? margins the now

see stay prices guys can't here inventory Commodity You forever. gains.

see do And margin you guidance of of kind the would think next how quarters? So what a couple mid-cycle about? then, be to

raw those positioned pretty mid-cycle question carefully, we've -- But that here, bit. But forward-looking are has continue one others because some and Well, from well a go where business. had -- I'd come Obviously, statements. whole say margins Look, the pretty going helped been think And or too making that's little a long stable that gains business, in today. for us. overall think we positioning and I and which where a UAN fairly buy I and those how in think but I making detailed we -- time. -- those strategy Those ammonia we're our of mostly to being I without Joel, pretty we're are of have buy again, sorry, some to think one lot they market. thing materials, be including big our our to sit, into many change don't our expanding distribution details where a going have for those exactly getting is been

likely and $XXX the terms a about to to million of of buy would would at say, business, would million more business. in I between I original the In integration million the we argue added likely we've probably then, And the our mid-cycle, our talked mid-cycle. to year. then And range that least benefits we be $XXX $XXX since year a that benefits million in of changes $XXX prospectus -- our per though,

Please, Caller ahead. line now. our go is open. We can take your question next

just dividends. you Andrews billion the just potentially Vincent from maybe your allocation. Stanley. us mention It's give but did Hi. on capital Good also thoughts buyback, everyone. morning, $X Morgan latest special doing Joc, Obviously,

could you maybe do what the a large cause be. about how could thinking potentially how common on you're and just So and from here it layer you to might special dividend dividend

mic I I my So, backwards. Vincent. got guess, Yes. Thanks,

got our we shareholders. to have Obviously, We're give capital payments. that's we sheet. are make the we our And a As reasonably the the is long going down been more go that strong do we how of done, to a to that the thoughts $X we expect million which business down balance billion capital. our to now. pay that you're consistent, to made really, think $XXX don't believe earlier, asking, said to And comfortable. about back own allocation, But see us to commitment question right once we've rest. distribute very which We've on that's a time to all brings I just as have enticing anything We than done.

to So types these we of at share and types continue and are those. ratios, buy expect value EBITDA-to-enterprise our we'll prices very our certainly that we of compelling, shares think

Now, -- the changes then business recognize shares a to some originally special to holders support or sell who make their in we if a But price of long-term we dividends. decision if intended the special don't the that towards of The dividend says would favor changes, that move our intend shares. or have level more balance. may of be to of that just

some in serve want respects, So, I our all shareholders. of to

that might so be they would something And like.

that. So, that would the be for reason

that regular terms we In dividends, would annually. look the the decision we've basically made of dividend regular at

debt And that the so our our till is count year. lower, look, But lower. share would we the level our thought was of leave is end

a ago. obviously, had less payments repayment total or dividend we to less today make debt than to money year And out -- so have -- less a So, we make. on for have going basis a on interest we

think of is for our long-term sure dividend think on make our go plus what we dividend all I to shareholder. into increases that reasonable So, would that the we're regular out paying

please go ahead. is next question. our can We your open, Caller line take

UBS. question also Hi, Fertilizantes. had from I is Beaumont on this a Lucas

wanted to there. the just volumes talk I purchased about nutrient So,

of bit in from modestly half the up it So, XX% kind in first second quarter but down over the was a last year.

Brazil, how second given if and half been strong could thoughts is demand if to shape us a you on volumes why the me perspective? there purchased just tell higher wondering up So, sort just your give could likely you the nutrient from in weren't volume of how has

Sorry, you the-- last I that can repeat that? bit of missed

just volumes So, the half Fertilizantes purchased nutrient second in the in please?

now you are we've lost Well, Lucas, there? completely. still you

hear hear Yes, Can me? I can you guys you.

again. We We hear lost Okay. can you Yes. you completely there.

You were breaking I you I sorry, up, profusely, I'm could again, struggling lost the and then apologize ask we're we with you think. completely. if but line,

-- accent. were about year-on-year my Probably XX% the first nutrient half. in they The so with the Fertilizantes, purchased in volumes, down

why just Thanks outlook stronger I it half Brazil been has second So, thinking wondering in and an purchased the on for wasn't strong what given volumes? you're nutrient how was

BXB to Lucas, has focus think selling through that we've Yes. which BXC on tried fairly and our system. I sales business, our business we explanation, own a our simple our BXB actually have is distribution product as integrated

of that count count is volumes. because so -- towards doesn't and we double to an the -- try don't And that, not we intercompany transfer

is, volumes from what nutrient our replaced were BXB will, down, you're business. were by So, or production because purchased our I business, suspect at looking there if you they that's own volumes internal although

Please your go is question next line open. now. Caller, our ahead. And

be Joc, are Hi. the called optimal in ratio, of the something supposed Liebig's nutrients applied Minimum. Law to

does to nitrogen because people less than much going for phosphate constrained phosphate even reduce potash? phosphate, and apply as more demand can't aren't potash constrained they with get and that though the So is nitrogen

Thanks. Yeah.

name. I Sorry, up you Can pick repeat didn't your name? the

Suisse, sorry. John Roberts from Credit

hi Oh, John.

I I question. Okay, think got Yeah. your

people a some So I don't have it's still Asia, using the markets, enough to right a be optimum vitamins. And say, wouldn't you West likewise, mean use I like will D but use know I would cetera. nitrogen. guess particularly Not of that amount Europe, you stop Africa, vitamin et suspect think including people in try you know or -- lot is C, there's best, from want ratio I phosphate. wouldn't will. if will no potash make that, the big be obviously, in less question having of deficit like probably, if to fertilizers. will the vitamin you there underutilized markets, enough so would I

agronomic But price on a I to that, others. The beyond so it's because not would though, nitrogen is of restricted gets acknowledge know at we're sales high So that the probably kind thing. one of thing if any my if takes understanding they will lot have looking up of for if like their India, other problem budget in they nutrients amount up a nitrogen. over-apply restrict countries historically it the that it has of disproportionate a And that to takes the uses. the tend could a been where budget, of other

now We'll is line Caller open. your ahead. question. next our take go Please

in a come for But They get operating Adam time. Sachs. phosphate half. to rates about take volumes to bit to maybe the Joc, some It's hoping what holistically, business more in in would talked been you I business the back bit. improving Samuelson Goldman your -- just with haven't was you there back phosphate XX%? it a little back US And earlier the the over know I

logistics under-absorbed of in they get could robust are as it overhead a margins sense a lot Florida? to be? leading issues it trying as idled and demand? maybe turnaround here it -- and to Is costs of that Just trying just seems not cost absorbing I'm just -- there's that to and is you're like

or we quarter three I and first went I restrictions. rail this if so of the look then -- freeze question four had low for, unbelievable run. inventory the we year we've year you look Adam. Yeah. had couple I If little last ability a Look, the Ida, Thanks, We our it years, that in so first about quarter sulfur power Louisiana -- And quarter Then restrictions thinking into went Hurricane I Texas which think, -- I year in had asked and bit. -- use, had of rail pre-stuff, at restricted out to that saw this et in restricted was in with a knocked back weeks, your cetera. that actually which this phosphates. into first we

so we've the to it's product sulfur. while up been and hard to built difficult inventory, And move very low -- on been we've

we're just gone come Now high on turnaround it's quarter but through. -- our that sulfur, we've

ice get so hoping am push be it southern storms, get down. to takes not that and there, us more of you should have start constrained to us earlier, the that from what And actually and our to damage any against been the -- will, inventory. actually of at slowed back logistics. external big damage, if damage things or storms as normal. this months There about, we been internal And It's then XX location, now hurricane, that I XX, because factors US sorry, the the there's talked you've ice that from hasn't of no from the continue restrictions

we to to we down looking as go But had we normal are more shut forward. So plants.

our we'll open. line question And Caller, your take next go is now. Please ahead.

Cleveland in just Thanks. and ammonia with investment light Are This ammonia might little Asian overall, from of any to getting across talk some costs and and a there your when outlook European increase. there? Ma'aden And there of profitability the Piken issues Research. And for the of bit wanted your about just curtailments? is Michael the we trajectory see business

Michael. Thanks, Yes.

million. quarter $XX second about In terms of our equity Ma'aden, were earnings

attributed sales the XXX,XXX business tonnes. Our was to

going So to Indian see We which thing. good; world. to going and quite to the also contribution that ultimately around our us is is is while to to up it's a actually making positive customers, it which what want our not helping supply good customers us, a hit,

Having than have we though, continue loved natural particularly, market, a gas mean, in that, Ma'aden price represents It's structural highly but advantaged is cost. -- unbelievable of said certainly I in it have this and slower sort the overall, of is to what plan. would see, advantage to a operation. that ramp-up So to they're the they continues then to is. all Kingdom Ma'aden be with [indiscernible]. an sulfur paying That other continues very that one low And been

Ma'aden tonne of actual the as per is producer. that a expect compared would to probably right would one now low-cost very place now So its rest taking world the cost low the have and

been has was of availability, In of part unrestricted. I availability, the second actually terms that ammonia ammonia question, our your think

two-thirds the on a which that We ourselves well. was basically market. between the open buying I that high-$XXX rest have to that with back price compared it, our produced and and XX% have agreements contract ammonia to the work we think CF And make then long-term we're market, to if contracts on range to $X,XXX-plus I quite in look the for tend our and

getting So at we're we're a the we but not it only need, advantaged ammonia very price. getting

Caller can line take ahead. Please, our your We next open. question. go is now

Hi. Andrew Wong RBC. from

last year, And quarters? it to setting that that QX by just looks sales? the follow-up seasonal for question Brazil? that? business? we And like QX, are a business reverse in but versus QX. then, corporate one part similar are is on down Thanks. extended that phosphate strength Can a does recall production. items. any subsequent Fertilizantes there which up I was in was a what but turnarounds some the So about charge talk Adam's, in QX. constraints happens And And production in it intersegment There of impacted was of mostly typically some you on line negative Was still in there

to piece about. that need to you're -- last little -- Clint, production more but talk let's might But one Brazil. the one which talking to you I leave about phosphate I'll in Clint specify a might

and think, the our again, But most plants put others, communities had put of particularly with were and of more COVID. of maintenance take probably I play too. we got to where us had to the we've these and there, And we of because a restrictions and than some time [ph] delay we Brazil, the number turnarounds, minimize on out. things the out sync anywhere, that our of probably of couple parts equipment plant, Shaw sitting of had shutdown off was -- the but because impacted were that we failures that our turnarounds a

to and breakdowns And particularly quarter was to supposed And them it stuff. conveying third a equipment. think this in had I them then we've systems respect fixed, it's get of that Brazil. been year. longer and to just with And of we fixed in issues to of Tapira, harder the had get the be couple

a we're we're for like demands say, market in so, that And when going And to strong again, production that. that's need a you meet bit look Brazil third from hangover there's all country. we like been out quarter. that are a to of there the ready But in

is Clint. And Andrew, this

of from business inventory, segment, think haven't of in XXX,XXX what that -- Fertilizantes. It's profit your June tonnes question third And yet. second about driver unit intercompany phosphates move to makes about typically in one a the down had tonnes the you're seeing final the sales. and move corporate to when party part I sales to I to happens the another business unit, think we is and but gone that

what segment. to need We consolidated that's numbers we in think all number, that so the I results the that the individual seeing as segments do for offset get come that you're right. the so together of the And corporate

what Fertilizantes is that in I that makes So shipment you're that an occurred sale. should out And think as internal seeing again, June. clear

line now can is Please, go question. Caller next we And ahead. your take open.

your didn't Jeff price This from phosphate fully is quarter. Zekauskas Two the Hi. third I JPMorgan. understand for questions. guidance

cash potash. an two you they you all isn't your net year. negative aren't was cash for share And million I should those in from and outflow. And And guess for of wondering, those I and from $XXX But are in negative those what as activities, XXXX, flows So, when You for if gave number of flow dividends, be? numbers the questions. operations? numbers secondly, terms out in the the paydown why a what financing explicit exclude you you had did debt repurchase number

sorry, Okay. Thanks, Vincent. Jeff. I'm -- or

trying phosphates. no, name price what talk -- going you're going one to Jeff, the Clint I'm going exactly forecast off. I'm and he's I'm back and let let ready. Clint one the for out get then to -- figure he's to to as you I'm Jeff. Sorry, come to about still give first

bit I funding down that Jeff, at prepayments, in entries facilities to have the particular Brazil, only of working a are source again, year-to-date, the of capital some the we things, we associated the of use, year-to-date, mechanisms quarter that about of those seasons of and when are Yes, be earlier, that's inventory you we customer financings think through not second that the – And we other seeing with particularly of entries some working million. in that the short-term think little finance capital, financing look what mentioned increase you're seasonally of a but receivable may some of our seeing financing the the us. as have we I use is, And we securitization that in to some in capital facilities. one are related account some to $XXX up I look our that, as is working at some

from like working replace lands And comes financing, typically that your We of AR other to in financing. so, as cash inventory operations our use that actually financing and cash and capital that line. cash in our sources

– are [ph] as in financing. capital so, pay those because lines from financing are in that And you'll customer free prepays lines of earlier down pen drawn off from is we were short-term down a that what use intact payments year, the interest-free working the to basically cost some the disconnect see operations,

those those through seeing drawn second the so, And probably of I think some year, to you're the a back lines reversal out, prepayments you'll of what start though the probably see and off half see also as reverse what of in you'll quarter. of

time happy kind detail reverse financing those more replacing in go seeing the third-party I come But dollars -- and year. back those to and through out think is as So that's some with of in half with in spend dynamics of that would of to more prepays the expect the off-line. you're that you customer I some what external

Okay.

the And mean me to we confuse phosphate in talk So Jeff, let little any didn't bit forecast. price a about way.

in. stage, priced at we're thing. bit challenge about on think depends XX% this little a I only and is, quarter. come I for think the the again, sold It same And when sales

pretty So of expect. piece what in early terms in the we

the stable I guess quarter way we the retreated at we're And at could I it you prices in is, look second where from now So, have moderated. a think slightly were and range.

at you we're where close to can look freight price almost from be you the for -- see going quarter. – take today's to So, cost today's price, pretty we're what published the of you'd if

it. spot bit from the way easiest little would is quarter. and two, that the be pricing quarter stay think it think at I to Certainly, a look expect at about to about come right stabilize I down now where probably but we we where moderated So, are a bit, has for

go our take question. is can We open, Instructions] next your Caller, [Operator line please ahead.

Hey, it's Chris Mizuho. Parkinson from

the there returning outlook the you're cash flow given any quick modest just certainly about all meaningful of outside some to But appreciate and question, Are question growth comments projects just other CapEx for shareholders. a of should planning. further dividends? the quick you're a of Just your years things just Faustina, stick of to improve you've been assessing that Thank looking Uncle we that or or anywhere with interest, you. and are Sam, currently kind special now at for reliability of potential the for or buyback at

the that those we're ammonia Chris. projects. I make think in has to which all reformer of Louisiana stage the years. just I Thanks reliability these for plant. Those mean, $XX we're in mentioned a But of making put sure second in mill, time up reliability, projects. a terms we this we're for in new a that looking Yes. Colonsay, will in Certainly, at difference going over idled start been million plant. of capacity big We the are couple

in -- potash, think that compaction of these got at is our are which the product. a opportunity KX finishing that for the part we've I -- when final have needs the well, part high-return a beyond of we where short. be projects, a needs aligns despite -- particularly for as because coming KX sort is down the we'll -- some of that's the so number KX, taking so basically our payback with these to margins, our production plant, building compacted do off unit the kind constant of of stayed But

we're remains life project production and to improving good what production extend of it reliability give to the the and we're potash they'll extend Colonsay, at those to we the of with intention or the CTV whether Louisiana, where So, payback, look there things at increase unit to of back the XXX% or prices, increasing intending going doing, shareholders. down these you expect a the life at -- doesn't but our compromise all of very have our

next question. your please our We Caller, ahead. go is can open, take line

in interesting I US the Hey, subsidized from sensitive tricky industry DAP/MAP with in ramifications own any the States own wasn't a your other to phosphate there any the a in BMO duty Could it's investigation UAN but that bit was the what But damage on from Russian Joel duties your UAN indicating determination situation again. future be of Maybe from found was question, week, that? the phosphate that gas. there case.

-- Well yes, Joel. thanks,

at We that. looked have definitely

had will difference. this from a judge know probably a the what this second a refer a hearing look or -- And at to we'll But month the has or to have had case. from the in if perspective another that on -- so the he have the -- are We hearing back ITC. of one

they original an So like has Trade, the and have International have US the was of International say Commission there the the their appeal ruling, then goes Trade Court to and gone actual any that. error back ruling to was -- to to something or that

ours we fairly and is that damage question the that to the think was there industry. substantive so much that back was might ruling to look, there not the actually to -- refer our in ITC And they

thing. And say. to from in even the understood in ITC whole but we'll the to a the look referred quite perspective, next at let's four the two expectation too that. that might So that our get there think we is back what see, from is our months, ITC have And still in not much while to risk to -- then takes I've

The that also facts quite really the won't that is is is of case quite any for belief we different. on timing But more number So each months. our different. a of know

industry was phosphate XXXX, we If margins. the to you pushed which they were brink very very, remember, negative the in of --

different So a case, very will. if you

So confident. we're quite

to call remarks. closing back questions. are for O'Rourke I Joc turn There like no further would to the

couple for I folks. listening you, analysts. it's know been a to companies Thank hours Okay. long you, of of

So to I reiterate I'd our messages. To like appreciate just a quick couple attention. your just conclude time and of your call,

as the the it even well these our think into all, results balance food same We be world the grow time, we quarter, needs to customers' continue strong remain continue and provider second our invest shareholders helping expect return of and shareholders in business XXXX. of sheet. capital and a needs. at conditions do meeting our in excellent First we for our we and meeting our to we delivered great the that business mission can our we to and to strengthen And significant committed

thank that, with So call, our you for great have day. a safe joining and

call. for you today's concludes Thank your This participation.

You now disconnect. may