(Reuters) – Fertilizer firm CF Industries reported a nearly 20% rise in its fourth-quarter profit on Wednesday, helped by higher ammonia sales and steady prices.
The company said sales rose on the back of contractual commitments served from the acquisition of the Waggaman ammonia production facility in Louisiana in December 2023.
CF Industries had bought the U.S. manufacturing facility of Australia’s Incitec Pivot in a $1.68 billion deal, as the Australian firm went through restructuring.
Incitec had also secured a 25-year supply agreement with CF Industries for up to 200,000 tonnes of ammonia per annum to support the Dyno Nobel Americas (DNA) explosives business. The facility has a nameplate capacity of 880,000 tonnes of ammonia annually.
Quarterly net sales of its ammonia segment, which produces anhydrous ammonia, were up at $572 million, from $495 million a year earlier.
The company expects strong demand in North America and Brazil in the current year due to improving corn plantation and prices from strong exports.
Despite a drop in global crop prices due to oversupply, robust export sales of U.S. corn prompted the U.S. Department of Agriculture to increase its 2024-25 export forecasts in December, benefiting fertilizer companies such as CF Industries, which thrive on increased plantation.
The fertilizer firm now expects to spend between $500 million and $550 million in the current year, up 1.4% at the midpoint from last year.
The Northbrook, Illinois-based company reported a net income of $328 million, or $1.89 per share, for the three months ended December 31, compared with $274 million, or $1.44 per share, last year.
(Reporting by Tanay Dhumal in Bengaluru; Editing by Mohammed Safi Shamsi)
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