08 Aug CF Industries Holdings, Inc. Reports First Half 2024 Net Earnings of $614 Million, Adjusted EBITDA of $1.21 Billion
Strong Operational Performance in Second Quarter 2024
Favorable Energy Spreads Underpin Continued Strong Cash Generation
Returned $832 Million to Shareholders through Dividends, Share Repurchases in First Half 2024
NORTHBROOK, Ill.–(BUSINESS WIRE)–CF Industries Holdings, Inc. (NYSE: CF), a leading global manufacturer of hydrogen and nitrogen products, today announced results for the first half and second quarter ended June 30, 2024.
Highlights
- First half 2024 net earnings(1)(2) of $614 million, or $3.31 per diluted share, EBITDA(3) of $1.24 billion, and adjusted EBITDA(3) of $1.21 billion
- Second quarter 2024 net earnings of $420 million, or $2.30 per diluted share, EBITDA of $752 million, and adjusted EBITDA of $752 million
- Trailing twelve months net cash from operating activities of $2.02 billion and free cash flow(4) of $1.15 billion
- Entered agreement with ExxonMobil for the transport and sequestration of up to 500,000 metric tons of carbon dioxide from Company’s Yazoo City, Mississippi, facility; start-up expected in 2028
- Repurchased 4.0 million shares for $305 million during the second quarter of 2024
“I am extremely proud of the team for running our plants exceptionally well, with phenomenal safety performance in the second quarter,” said Tony Will, president and chief executive officer, CF Industries Holdings, Inc.
Operations Overview
The Company continues to operate safely across its network. As of June 30, 2024, the 12-month rolling average recordable incident rate was 0.17 incidents per 200,000 work hours, significantly better than industry averages.
Gross ammonia production for the first half and second quarter of 2024 was approximately 4.8 million and 2.6 million tons, respectively, compared to 4.7 million and 2.4 million tons in the first half and second quarter, respectively, of 2023. The Company expects gross ammonia production for the full year 2024 to be approximately 9.8 million tons.
Financial Results Overview
First Half 2024 Financial Results
For the first half of 2024, net earnings attributable to common stockholders were $614 million, or $3.31 per diluted share, EBITDA was $1.24 billion, and adjusted EBITDA was $1.21 billion. These results compare to first half of 2023 net earnings attributable to common stockholders of $1.09 billion, or $5.55 per diluted share, EBITDA of $1.78 billion, and adjusted EBITDA of $1.72 billion.
Net sales in the first half of 2024 were $3.04 billion compared to $3.79 billion in the first half of 2023. Average selling prices for the first half of 2024 were lower than in the first half of 2023 as lower global energy costs reduced the global market clearing price required to meet global demand. Sales volumes in the first half of 2024 were similar to the first half of 2023 as higher ammonia sales volumes due primarily to the addition of contractual commitments served from the recently acquired Waggaman ammonia production facility were offset primarily by lower urea and UAN sales volumes.
Cost of sales for the first half of 2024 was lower compared to the first half of 2023 due to lower realized natural gas costs partially offset by higher maintenance costs incurred in the first quarter of 2024 related to plant outages.
The average cost of natural gas reflected in the Company’s cost of sales was $2.53 per MMBtu in the first half of 2024 compared to the average cost of natural gas in cost of sales of $4.56 per MMBtu in the first half of 2023.
Second Quarter 2024 Financial Results
For the second quarter of 2024, net earnings attributable to common stockholders were $420 million, or $2.30 per diluted share, EBITDA was $752 million, and adjusted EBITDA was $752 million. These results compare to second quarter of 2023 net earnings attributable to common stockholders of $527 million, or $2.70 per diluted share, EBITDA of $855 million, and adjusted EBITDA of $857 million.
Net sales in the second quarter of 2024 were $1.57 billion compared to $1.78 billion in the second quarter of 2023. Average selling prices for the second quarter of 2024 were lower than in the second quarter of 2023 as lower global energy costs reduced the global market clearing price required to meet global demand. Sales volumes in the second quarter of 2024 were lower than the second quarter of 2023 as lower ammonia, UAN and AN sales volumes were partially offset by higher urea sales volumes.
Cost of sales for the second quarter of 2024 was lower compared to the second quarter of 2023 primarily due to lower realized natural gas costs.
The average cost of natural gas reflected in the Company’s cost of sales was $1.90 per MMBtu in the second quarter of 2024 compared to the average cost of natural gas in cost of sales of $2.75 per MMBtu in the second quarter of 2023.
Capital Management
Capital Expenditures
Capital expenditures in the second quarter and first half of 2024 were $84 million and $182 million, respectively. Management projects capital expenditures for full year 2024 will be approximately $550 million.
Share Repurchase Program
The Company repurchased 8.3 million shares for $652 million during the first half of 2024, which includes the repurchase of 4.0 million shares for $305 million during the second quarter of 2024. Since CF Industries commenced its current $3 billion share repurchase program in the second quarter of 2023, the Company has repurchased 13.9 million shares for approximately $1.1 billion. As of June 30, 2024, approximately $1.9 billion remains under the program, which expires in December 2025.
CHS Inc. Distribution
On July 31, 2024, the Board of Managers of CF Industries Nitrogen, LLC approved a semi-annual distribution payment to CHS Inc. of $165 million for the distribution period ended June 30, 2024. The distribution was paid on July 31, 2024.
Nitrogen Market Outlook
From the end of the second quarter of 2024 into the third quarter of 2024, gas curtailments in Egypt and Trinidad, along with scheduled outages and a lack of substantial urea export availability from China, have supported global nitrogen pricing during a period of year that typically sees lower prices and low global shipments as demand shifts from the Northern Hemisphere to the Southern Hemisphere. In the near-term, management expects the global supply-demand balance to remain constructive, led by nitrogen import requirements through year-end for Brazil and India and continued wide energy spreads between North America and high-cost production in Europe.
- North America: Management believes nitrogen channel inventories in the region for all products are below average based on strong demand for urea and UAN during the spring application season and higher-than-expected planted corn acres. Reported UAN and ammonia fill programs achieved prices above 2023 levels despite softening farm economics in the region as corn and soybean prices have fallen due to higher forecasted production in 2024 in the United States and Brazil.
- Brazil: Urea consumption in Brazil in 2024 is forecast to increase 3% year-over-year to more than 8.0 million metric tons, supported by improved supply availability and lower global urea prices. Urea imports to Brazil in 2024 are expected to be in the range of 7.0-8.0 million metric tons as domestic production remains limited.
- India: India is expected to be active importing urea through the second half of the year as the country secured lower-than-expected volumes in its two most recent tenders and urea consumption is expected to rise to support rice, wheat and other crop production. Management expects urea imports to India in 2024, including volumes supplied on a contractual basis, to be in a range of 5.0-6.0 million metric tons as recently revitalized plants and new facilities in the country operate at higher rates.
- Europe: Approximately 25% of ammonia and 30% of urea capacity were reported in shutdown/curtailment in Europe in early July 2024. Management believes that ammonia operating rates and overall domestic nitrogen product output in Europe will remain below historical averages over the long-term given the region’s status as the global marginal producer. As a result, the Company expects nitrogen imports of ammonia and upgraded products to the region to be higher than historical averages.
- China: Ongoing urea export controls by the Chinese government continues to limit urea export availability from the country. For the first six months of 2024, China exported 140,000 metric tons of urea, 86 percent lower than the same period in 2023.
- Russia: Urea exports from Russia are expected to increase in 2024 due to the start-up of new urea granulation capacity and the willingness of certain countries to purchase Russian fertilizer, including Brazil and the United States. Exports of ammonia from Russia are also expected to rise with the completion of the country’s Taman port ammonia terminal in the second half of 2024 though annual ammonia export volumes are projected to remain below pre-war levels.
Over the medium-term, significant energy cost differentials between North American producers and high-cost producers in Europe and Asia are expected to persist. As a result, the Company believes the global nitrogen cost curve will remain supportive of strong margin opportunities for low-cost North American producers.
Longer-term, management expects the global nitrogen supply-demand balance to tighten as global nitrogen capacity growth over the next four years is not projected to keep pace with expected global nitrogen demand growth of approximately 1.5% per year for traditional applications and new demand growth for clean energy applications. Global production is expected to remain constrained by continued challenges related to cost and availability of natural gas.
Strategic Initiatives Update
Evaluation of low-carbon ammonia technologies and global low-carbon demand development
CF Industries, along with its partners, continue to advance front-end engineering and design (FEED) studies evaluating autothermal reforming (ATR) ammonia production technology and assessing the cost and viability of adding flue gas carbon dioxide capture to a steam methane reforming (SMR) ammonia facility. Both FEED studies are expected to be completed in the fourth quarter of 2024.
CF Industries and its partners also expect greater clarity later in 2024 regarding demand for low-carbon ammonia, including the ammonia carbon intensity requirements of offtake partners as well as government incentives and regulatory developments in partners’ local jurisdictions.
Donaldsonville Complex green ammonia project
Commissioning of the 20-megawatt alkaline water electrolysis plant constructed at CF Industries’ Donaldsonville, Louisiana, manufacturing complex is nearing completion. In anticipation of start-up, the Company has entered into an agreement to procure 45V-compliant renewable energy certificates to pair with electrolyzer operations. As a result, the electrolyzer will generate green hydrogen that enables CF Industries to produce green ammonia, which refers to ammonia produced with hydrogen sourced from an electrolysis process that produces no carbon dioxide emissions. At full electrolyzer capacity, the Company will be able to produce approximately 20,000 tons of green ammonia per year. This represents North America’s first commercial-scale green ammonia capacity.
Donaldsonville Complex carbon capture and sequestration project
Engineering activities for the construction of a dehydration and compression unit at CF Industries’ Donaldsonville Complex continue to advance: all major equipment for the facility has been procured, fabrication of the carbon dioxide compressors is proceeding and construction of the cooling tower required for the unit has been completed. Once in service, the dehydration and compression unit will enable up to 2 million metric tons of captured process carbon dioxide to be transported and permanently stored by ExxonMobil. CF Industries expects the project to qualify for tax credits under Section 45Q of the Internal Revenue Code, which provides a credit per metric ton of carbon dioxide sequestered. Start-up of the project is expected in 2025.
Yazoo City Complex carbon capture and sequestration project
CF Industries signed a definitive commercial agreement in July 2024 with ExxonMobil for the transport and sequestration in permanent geologic storage of up to 500,000 metric tons of carbon dioxide annually from the Company’s Yazoo City, Mississippi, Complex. CF Industries will invest approximately $100 million into its Yazoo City Complex to build a carbon dioxide dehydration and compression unit to enable up to 500,000 metric tons of carbon dioxide captured from the ammonia production process per year to be transported and stored. CF Industries expects the project to qualify for tax credits under Section 45Q of the Internal Revenue Code, which provides a credit per metric ton of carbon dioxide sequestered. Start-up of the project is expected in 2028.
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___________________________________________________ |
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|
(1) |
Certain items recognized during the first half of 2024 impacted the Company’s financial results and their comparability to the prior year period. See the table accompanying this release for a summary of these items. |
|
(2) |
Financial results for the first half of 2024 include the impact of CF Industries’ acquisition of the Waggaman, Louisiana, ammonia production facility on December 1, 2023. |
|
(3) |
EBITDA is defined as net earnings attributable to common stockholders plus interest expense—net, income taxes and depreciation and amortization. See reconciliations of EBITDA and adjusted EBITDA to the most directly comparable GAAP measures in the tables accompanying this release. |
|
(4) |
Free cash flow is defined as net cash from operating activities less capital expenditures and distributions to noncontrolling interest. See reconciliation of free cash flow to the most directly comparable GAAP measure in the table accompanying this release. |
Consolidated Results
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Three months ended |
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Six months ended |
||||||||||||
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|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
(dollars in millions, except per share and per MMBtu amounts) |
||||||||||||||
|
Net sales |
$ |
1,572 |
|
|
$ |
1,775 |
|
|
$ |
3,042 |
|
|
$ |
3,787 |
|
|
Cost of sales |
|
893 |
|
|
|
971 |
|
|
|
1,954 |
|
|
|
2,120 |
|
|
Gross margin |
$ |
679 |
|
|
$ |
804 |
|
|
$ |
1,088 |
|
|
$ |
1,667 |
|
|
Gross margin percentage |
|
43.2 |
% |
|
|
45.3 |
% |
|
|
35.8 |
% |
|
|
44.0 |
% |
|
|
|
|
|
|
|
|
|
||||||||
|
Net earnings attributable to common stockholders |
$ |
420 |
|
|
$ |
527 |
|
|
$ |
614 |
|
|
$ |
1,087 |
|
|
Net earnings per diluted share |
$ |
2.30 |
|
|
$ |
2.70 |
|
|
$ |
3.31 |
|
|
$ |
5.55 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
EBITDA(1) |
$ |
752 |
|
|
$ |
855 |
|
|
$ |
1,240 |
|
|
$ |
1,779 |
|
|
Adjusted EBITDA(1) |
$ |
752 |
|
|
$ |
857 |
|
|
$ |
1,211 |
|
|
$ |
1,723 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Sales volume by product tons (000s) |
|
4,875 |
|
|
|
4,938 |
|
|
|
9,399 |
|
|
|
9,473 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Natural gas supplemental data (per MMBtu): |
|
|
|
|
|
|
|
||||||||
|
Natural gas costs in cost of sales(2) |
$ |
1.90 |
|
|
$ |
2.74 |
|
|
$ |
2.30 |
|
|
$ |
3.86 |
|
|
Realized derivatives loss in cost of sales(3) |
|
— |
|
|
|
0.01 |
|
|
|
0.23 |
|
|
|
0.70 |
|
|
Cost of natural gas used for production in cost of sales |
$ |
1.90 |
|
|
$ |
2.75 |
|
|
$ |
2.53 |
|
|
$ |
4.56 |
|
|
Average daily market price of natural gas Henry Hub (Louisiana) |
$ |
2.04 |
|
|
$ |
2.12 |
|
|
$ |
2.24 |
|
|
$ |
2.40 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Unrealized net mark-to-market gain on natural gas derivatives |
$ |
(1 |
) |
|
$ |
— |
|
|
$ |
(34 |
) |
|
$ |
(72 |
) |
|
Depreciation and amortization |
$ |
222 |
|
|
$ |
221 |
|
|
$ |
475 |
|
|
$ |
427 |
|
|
Capital expenditures |
$ |
84 |
|
|
$ |
95 |
|
|
$ |
182 |
|
|
$ |
164 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Production volume by product tons (000s): |
|
|
|
|
|
|
|
||||||||
|
Ammonia(4) |
|
2,602 |
|
|
|
2,374 |
|
|
|
4,750 |
|
|
|
4,733 |
|
|
Granular urea |
|
1,255 |
|
|
|
1,122 |
|
|
|
2,214 |
|
|
|
2,333 |
|
|
UAN (32%) |
|
1,833 |
|
|
|
1,665 |
|
|
|
3,464 |
|
|
|
3,263 |
|
|
Ammonium nitrate (AN) |
|
333 |
|
|
|
300 |
|
|
|
674 |
|
|
|
688 |
|
|
___________________________________________________ |
|
|
(1) |
See reconciliations of EBITDA and adjusted EBITDA to the most directly comparable GAAP measures in the tables accompanying this release. |
|
(2) |
Includes the cost of natural gas used for production and related transportation that is included in cost of sales during the period under the first-in, first-out inventory cost method. Excludes unrealized mark-to-market gains and losses on natural gas derivatives. |
|
(3) |
Includes realized gains and losses on natural gas derivatives settled during the period. |
|
(4) |
Gross ammonia production, including amounts subsequently upgraded on-site into granular urea, UAN, or AN. |
Ammonia Segment
CF Industries’ ammonia segment produces anhydrous ammonia (ammonia), which is the base product that the Company manufactures, containing 82 percent nitrogen and 18 percent hydrogen. The results of the ammonia segment consist of sales of ammonia to external customers for its nitrogen content as a fertilizer, in emissions control and in other industrial applications. In addition, the Company upgrades ammonia into other nitrogen products such as urea, UAN and AN.
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Three months ended |
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Six months ended |
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|
2024(1) |
|
|
2023 |
|
|
2024(1) |
|
|
2023 |
|
||||
|
|
(dollars in millions, except per ton amounts) |
||||||||||||||
|
Net sales |
$ |
409 |
|
|
$ |
525 |
|
|
$ |
811 |
|
|
$ |
949 |
|
|
Cost of sales |
|
262 |
|
|
|
303 |
|
|
|
599 |
|
|
|
583 |
|
|
Gross margin |
$ |
147 |
|
|
$ |
222 |
|
|
$ |
212 |
|
|
$ |
366 |
|
|
Gross margin percentage |
|
35.9 |
% |
|
|
42.3 |
% |
|
|
26.1 |
% |
|
|
38.6 |
% |
|
|
|
|
|
|
|
|
|
||||||||
|
Sales volume by product tons (000s) |
|
979 |
|
|
|
1,053 |
|
|
|
1,897 |
|
|
|
1,705 |
|
|
Sales volume by nutrient tons (000s)(2) |
|
802 |
|
|
|
863 |
|
|
|
1,555 |
|
|
|
1,398 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Average selling price per product ton |
$ |
418 |
|
|
$ |
499 |
|
|
$ |
428 |
|
|
$ |
557 |
|
|
Average selling price per nutrient ton(2) |
|
510 |
|
|
|
608 |
|
|
|
522 |
|
|
|
679 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Adjusted gross margin(3): |
|
|
|
|
|
|
|
||||||||
|
Gross margin |
$ |
147 |
|
|
$ |
222 |
|
|
$ |
212 |
|
|
$ |
366 |
|
|
Depreciation and amortization |
|
49 |
|
|
|
47 |
|
|
|
121 |
|
|
|
78 |
|
|
Unrealized net mark-to-market gain on natural gas derivatives |
|
— |
|
|
|
— |
|
|
|
(12 |
) |
|
|
(21 |
) |
|
Adjusted gross margin |
$ |
196 |
|
|
$ |
269 |
|
|
$ |
321 |
|
|
$ |
423 |
|
|
Adjusted gross margin as a percent of net sales |
|
47.9 |
% |
|
|
51.2 |
% |
|
|
39.6 |
% |
|
|
44.6 |
% |
|
|
|
|
|
|
|
|
|
||||||||
|
Gross margin per product ton |
$ |
150 |
|
|
$ |
211 |
|
|
$ |
112 |
|
|
$ |
215 |
|
|
Gross margin per nutrient ton(2) |
|
183 |
|
|
|
257 |
|
|
|
136 |
|
|
|
262 |
|
|
Adjusted gross margin per product ton |
|
200 |
|
|
|
255 |
|
|
|
169 |
|
|
|
248 |
|
|
Adjusted gross margin per nutrient ton(2) |
|
244 |
|
|
|
312 |
|
|
|
206 |
|
|
|
303 |
|
|
___________________________________________________ |
|
|
(1) |
Financial results for the second quarter and first half of 2024 include the impact of CF Industries’ acquisition of the Waggaman, Louisiana, ammonia production facility on December 1, 2023. |
|
(2) |
Nutrient tons represent the tons of nitrogen within the product tons. |
|
(3) |
Adjusted gross margin, adjusted gross margin as a percent of net sales and adjusted gross margin per product ton and per nutrient ton are non-GAAP financial measures. Adjusted gross margin is defined as gross margin excluding depreciation and amortization and unrealized net mark-to-market (gain) loss on natural gas derivatives. A reconciliation of adjusted gross margin, adjusted gross margin as a percent of net sales and adjusted gross margin per product ton and per nutrient ton to gross margin, the most directly comparable GAAP measure, is provided in the table above. See “Note Regarding Non-GAAP Financial Measures” in this release. |
Comparison of first half 2024 to first half 2023:
- Ammonia sales volume for 2024 increased compared to 2023 due to the addition of contractual commitments served from the recently acquired Waggaman ammonia production facility, partially offset by lower spring ammonia agricultural applications in North America compared to the prior year.
- Ammonia average selling prices decreased for 2024 compared to 2023 as lower global energy costs reduced the global market clearing price required to meet global demand and the Company had a higher proportion of non-agricultural ammonia sales.
- Ammonia adjusted gross margin per ton decreased for 2024 compared to 2023 due primarily to lower average selling prices and higher maintenance costs partially offset by lower realized natural gas costs.
Granular Urea Segment
CF Industries’ granular urea segment produces granular urea, which contains 46 percent nitrogen. Produced from ammonia and carbon dioxide, it has the highest nitrogen content of any of the Company’s solid nitrogen products.
|
|
Three months ended |
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Six months ended |
||||||||||||
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
(dollars in millions, except per ton amounts) |
||||||||||||||
|
Net sales |
$ |
457 |
|
|
$ |
460 |
|
|
$ |
864 |
|
|
$ |
1,071 |
|
|
Cost of sales |
|
230 |
|
|
|
222 |
|
|
|
483 |
|
|
|
549 |
|
|
Gross margin |
$ |
227 |
|
|
$ |
238 |
|
|
$ |
381 |
|
|
$ |
522 |
|
|
Gross margin percentage |
|
49.7 |
% |
|
|
51.7 |
% |
|
|
44.1 |
% |
|
|
48.7 |
% |
|
|
|
|
|
|
|
|
|
||||||||
|
Sales volume by product tons (000s) |
|
1,251 |
|
|
|
1,147 |
|
|
|
2,343 |
|
|
|
2,470 |
|
|
Sales volume by nutrient tons (000s)(1) |
|
576 |
|
|
|
529 |
|
|
|
1,078 |
|
|
|
1,137 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Average selling price per product ton |
$ |
365 |
|
|
$ |
401 |
|
|
$ |
369 |
|
|
$ |
434 |
|
|
Average selling price per nutrient ton(1) |
|
793 |
|
|
|
870 |
|
|
|
801 |
|
|
|
942 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Adjusted gross margin(2): |
|
|
|
|
|
|
|
||||||||
|
Gross margin |
$ |
227 |
|
|
$ |
238 |
|
|
$ |
381 |
|
|
$ |
522 |
|
|
Depreciation and amortization |
|
76 |
|
|
|
71 |
|
|
|
145 |
|
|
|
150 |
|
|
Unrealized net mark-to-market gain on natural gas derivatives |
|
— |
|
|
|
— |
|
|
|
(9 |
) |
|
|
(20 |
) |
|
Adjusted gross margin |
$ |
303 |
|
|
$ |
309 |
|
|
$ |
517 |
|
|
$ |
652 |
|
|
Adjusted gross margin as a percent of net sales |
|
66.3 |
% |
|
|
67.2 |
% |
|
|
59.8 |
% |
|
|
60.9 |
% |
|
|
|
|
|
|
|
|
|
||||||||
|
Gross margin per product ton |
$ |
181 |
|
|
$ |
207 |
|
|
$ |
163 |
|
|
$ |
211 |
|
|
Gross margin per nutrient ton(1) |
|
394 |
|
|
|
450 |
|
|
|
353 |
|
|
|
459 |
|
|
Adjusted gross margin per product ton |
|
242 |
|
|
|
269 |
|
|
|
221 |
|
|
|
264 |
|
|
Adjusted gross margin per nutrient ton(1) |
|
526 |
|
|
|
584 |
|
|
|
480 |
|
|
|
573 |
|
|
___________________________________________________ |
|
|
(1) |
Nutrient tons represent the tons of nitrogen within the product tons. |
|
(2) |
Adjusted gross margin, adjusted gross margin as a percent of net sales and adjusted gross margin per product ton and per nutrient ton are non-GAAP financial measures. Adjusted gross margin is defined as gross margin excluding depreciation and amortization and unrealized net mark-to-market (gain) loss on natural gas derivatives. A reconciliation of adjusted gross margin, adjusted gross margin as a percent of net sales and adjusted gross margin per product ton and per nutrient ton to gross margin, the most directly comparable GAAP measure, is provided in the table above. See “Note Regarding Non-GAAP Financial Measures” in this release. |
Comparison of first half 2024 to first half 2023:
- Granular urea sales volumes for 2024 were lower than 2023 primarily due to reduced availability of ammonia for upgrade and lower supply availability from the impact of severe weather that caused urea plant outages in the first quarter of 2024.
- Urea average selling prices decreased for 2024 compared to 2023 as lower global energy costs reduced the global market clearing price required to meet global demand.
- Granular urea adjusted gross margin per ton decreased for 2024 compared to 2023 due primarily to lower average selling prices and the impact of purchased volumes of granular urea to meet customer commitments partially offset by lower realized natural gas costs.
UAN Segment
CF Industries’ UAN segment produces urea ammonium nitrate solution (UAN). UAN is a liquid product with nitrogen content that typically ranges from 28 percent to 32 percent and is produced by combining urea and ammonium nitrate in solution.
|
|
Three months ended |
|
Six months ended |
||||||||||||
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
(dollars in millions, except per ton amounts) |
||||||||||||||
|
Net sales |
$ |
475 |
|
|
$ |
548 |
|
|
$ |
900 |
|
|
$ |
1,215 |
|
|
Cost of sales |
|
259 |
|
|
|
289 |
|
|
|
541 |
|
|
|
635 |
|
|
Gross margin |
$ |
216 |
|
|
$ |
259 |
|
|
$ |
359 |
|
|
$ |
580 |
|
|
Gross margin percentage |
|
45.5 |
% |
|
|
47.3 |
% |
|
|
39.9 |
% |
|
|
47.7 |
% |
|
|
|
|
|
|
|
|
|
||||||||
|
Sales volume by product tons (000s) |
|
1,748 |
|
|
|
1,809 |
|
|
|
3,359 |
|
|
|
3,471 |
|
|
Sales volume by nutrient tons (000s)(1) |
|
553 |
|
|
|
570 |
|
|
|
1,062 |
|
|
|
1,094 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Average selling price per product ton |
$ |
272 |
|
|
$ |
303 |
|
|
$ |
268 |
|
|
$ |
350 |
|
|
Average selling price per nutrient ton(1) |
|
859 |
|
|
|
961 |
|
|
|
847 |
|
|
|
1,111 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Adjusted gross margin(2): |
|
|
|
|
|
|
|
||||||||
|
Gross margin |
$ |
216 |
|
|
$ |
259 |
|
|
$ |
359 |
|
|
$ |
580 |
|
|
Depreciation and amortization |
|
68 |
|
|
|
70 |
|
|
|
137 |
|
|
|
136 |
|
|
Unrealized net mark-to-market gain on natural gas derivatives |
|
— |
|
|
|
— |
|
|
|
(10 |
) |
|
|
(21 |
) |
|
Adjusted gross margin |
$ |
284 |
|
|
$ |
329 |
|
|
$ |
486 |
|
|
$ |
695 |
|
|
Adjusted gross margin as a percent of net sales |
|
59.8 |
% |
|
|
60.0 |
% |
|
|
54.0 |
% |
|
|
57.2 |
% |
|
|
|
|
|
|
|
|
|
||||||||
|
Gross margin per product ton |
$ |
124 |
|
|
$ |
143 |
|
|
$ |
107 |
|
|
$ |
167 |
|
|
Gross margin per nutrient ton(1) |
|
391 |
|
|
|
454 |
|
|
|
338 |
|
|
|
530 |
|
|
Adjusted gross margin per product ton |
|
162 |
|
|
|
182 |
|
|
|
145 |
|
|
|
200 |
|
|
Adjusted gross margin per nutrient ton(1) |
|
514 |
|
|
|
577 |
|
|
|
458 |
|
|
|
635 |
|
Contacts
Media
Chris Close
Senior Director, Corporate Communications
847-405-2542 – cclose@cfindustries.com
Investors
Darla Rivera
Director, Investor Relations
847-405-2045 – darla.rivera@cfindustries.com
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