SASKATOON – Potash Corporation of Saskatchewan (TSX:POT) says its fourth-quarter profit dropped to US$230 million – down 45 per cent from a year earlier as it took hits from lower fertilizer prices and downsizing.
The profit amounted to 26 cents per share, including a US$60 million charge or about five cents per share, for severance-related costs for a labour force reduction announced in December.
The Saskatoon-based company announced in December that it would cut its workforce by about 18 per cent, affecting 1,045 people including roughly 440 in its home province.
PotashCorp says potash sales volumes were higher in the fourth quarter than in comparable periods but competitive pressures resulted in lower prices.
Overall sales revenue fell to US$1.54 billion, down from $1.64 billion in the fourth quarter of 2012.
PotashCorp’s revenue was above the consensus estimate of $1.4 billion while earnings were below the general estimate of 31 cents per share.
“This past quarter was a difficult one,” said PotashCorp CEO Bill Doyle in a statement Thursday.
“Pricing headwinds – most notably in potash – weighed on our performance, although there were signs as the quarter came to a close that the uncertainty in global markets was beginning to abate.”
“Our focus remained on those things we can influence and we took important steps to enhance our competitive position across all three nutrients and prepare the company to deliver better performance.”
In addition to the cuts in Saskatchewan, PotashCorp said in December it would cut 130 jobs in New Brunswick, while the rest will be outside Canada, including more than 435 in the United States.
Last week, Canpotex, the export partnership including PotashCorp, Agrium and Mosiac, announced a deal for the supply of 700,000 metric tonnes of potash to Chinese company Sinochem Fertilizer Macao Commerical Offshore Ltd.
Financial terms of the sale were not immediately available.
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