Mississippi Chemical Reports First Quarter Results.Business Editors YAZOO CITY Yazoo City, city (1990 pop. 12,427), seat of Yazoo co., W central Miss., on the Yazoo River; inc. 1830. It is a trade, processing, and industrial center in a cotton, cattle, and soybean area. Oil is refined, and clothing and fertilizer are manufactured. , Miss.--(BUSINESS WIRE)--Oct. 24, 2000 Mississippi Mississippi, state, United States Mississippi (mĭs'əsĭp`ē), one of the Deep South states of the United States. It is bordered by Alabama (E), the Gulf of Mexico (S), Arkansas and Louisiana, with most of the border formed by Chemical Corporation (NYSE NYSE See: New York Stock Exchange :GRO GRO Guerrero (Estado de México) GRO General Register Office (UK) GRO Greater Research Opportunities GRO Gamma Ray Observatory GRO Growth-Related Oncogene GRO Greensboro, North Carolina ) today reported results for the first fiscal quarter ended Sept. 30, 2000. Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight increased 24 percent to $120.1 million from $97.0 million in the prior-year period. For the quarter, a net loss of $12.2 million, or 47 cents per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, was reported, compared to a net loss of $11.1 million, or 42 cents per diluted share, before non-recurring benefits, in the prior-year quarter. During the quarter ending Sept. 30, 1999, approximately $5.5 million in one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. benefits were recognized, resulting in a net loss of $5.6 million, or 21 cents per diluted share. The operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. for the quarter was $14.7 million compared to $11.1 million before non-recurring benefits in the first quarter of fiscal 1999. For the quarter, EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become (earnings before interest, taxes, depreciation and amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
The prior year's $5.5 million in one-time benefits included a tax benefit of $2.0 million resulting from settlement agreements with the Internal Revenue Service and a $3.5 million business interruption insurance Noun 1. business interruption insurance - insurance that provides protection for the loss of profits and continuing fixed expenses resulting from a break in commercial activities due to the occurrence of a peril claim recovery. Due to current industry conditions and reported results for the quarter, the company's board of directors voted to eliminate the 3 cent per share quarterly dividend effective for the quarter ended Sept. 30, 2000. The dividend payment represents approximately $3.1 million on an annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. basis. In announcing the results, Charles Charles, archduke of Austria Charles, 1771–1847, archduke of Austria; brother of Holy Roman Emperor Francis II. Despite his epilepsy, he was the ablest Austrian commander in the French Revolutionary and Napoleonic wars; however, he was handicapped by O. Dunn Dunn may refer to: Places
v. in·ten·si·fied, in·ten·si·fy·ing, in·ten·si·fies v.tr. 1. To make intense or more intense: by domestic industry production curtailments due to high natural gas costs, have continued to move nitrogen prices upward. Unfortunately, most of the increased revenues were absorbed by record-high natural gas costs, which on a unit cost basis, increased 64 percent from the prior-year quarter. Even with the extreme energy prices, our nitrogen operations showed improved performance when compared with prior-year results, excluding one-time benefits. "Our phosphate phosphate, salt or ester of phosphoric acid, H3PO4. Because phosphoric acid is tribasic (having three replaceable hydrogen atoms), it forms monophosphate, diphosphate, and triphosphate salts in which one, two, or three of the hydrogens of the results were lower due to a 16 percent decrease in DAP prices and high ammonia ammonia, chemical compound, NH3, colorless gas that is about one half as dense as air at ordinary temperatures and pressures. It has a characteristic pungent, penetrating odor. cost compared to the prior-year quarter. However, prices increased 5 percent from the recent June June: see month. quarter as domestic production curtailments have positively affected the supply/demand balance. "At our potash potash: see potassium carbonate. potash Name used for various inorganic compounds of potassium, chiefly the carbonate (K2CO3), a white crystalline material formerly obtained from wood ashes. operations, our West mine continued to work through a large area of low-grade low-grade Of or relating to debt that has a credit rating of B or below. Low-grade debt offers an above-average yield but entails substantial risk because promised payments may not be made in a timely manner. ore, which has had a significant negative impact on our unit cost for over a year. Late in the quarter, we began to experience a meaningful improvement in the ore quality and corresponding unit cost at this mine. "We have continued to identify and implement new opportunities to reduce costs and increase efficiency at the company. Since the beginning of last fiscal year, excluding the acquisition of the Faustina Faustina (fôstī`nə), name of two women, wives of Roman emperors. 1 The elder (c.104–141) was the wife of Antoninus Pius, who founded a school for orphan girls in her honor. 2 The younger (c. urea facility, we have realized a 14 percent reduction in the number of employees in our nitrogen operations and headquarters staff through attrition Attrition The reduction in staff and employees in a company through normal means, such as retirement and resignation. This is natural in any business and industry. Notes: , and, most recently, an early retirement program and a reduction in force. This reduced staffing level will account for approximately $7.0 million in savings on an annualized basis. Furthermore, the company has been engaged in a program to sell assets that are not material to the company's operations or future success. Our ability to deal effectively with those cost areas over which we have control has enabled us to reduce our debt level from a year ago, despite the operating losses. "To maximize results in the current environment, we continue to determine operating levels for our plants based on the relationship between nitrogen product prices and natural gas prices and our customers' requirements. Industry inventory levels for nitrogen solutions and ammonium nitrate ammonium nitrate, chemical compound, NH4NO3, that exists as colorless, rhombohedral crystals at room temperature but changes to monoclinic crystals when heated above 32°C;. , already lower than last year's, combined with industry production levels through the winter, will play a major role in determining product prices as we enter the spring season. Due to high natural gas prices and the seasonal nature of our business, the months leading up to the spring season will continue to be challenging." Comparing the first fiscal quarter ended Sept. 30, 2000, to the prior-year quarter: Nitrogen - During the current quarter, total nitrogen sales volume increased 6 percent while the weighted-average selling price increased 60 percent compared to the prior-year period. Largely offsetting the effect of increased nitrogen prices was a 64 percent increase in the average price paid for natural gas, the primary feedstock for nitrogen products. - Ammonia - Sales volume increased 25 percent, while the average selling price increased 60 percent. Industry production curtailments due to the high cost of natural gas reduced world supplies resulting in upward pressure on prices. During the quarter, both ammonia plants in the Yazoo City, Miss., complex underwent scheduled maintenance turnarounds. Additional downtime was taken as market conditions forced production curtailments during the quarter in Yazoo City and Donaldsonville, La. Third-party purchases were made to cover lost production in order to meet the increased demand for the quarter. - Ammonium Nitrate - For the quarter, ammonium nitrate sales volume increased 24 percent, while the average selling price increased 18 percent. In the prior-year quarter, sales volume and price were negatively affected by the overhang of low-priced Russian imports, a situation that has been alleviated by an anti-dumping remedy. A meaningful improvement in pricing was prevented by the presence of low-priced imports from Ukraine in the marketplace, which replaced the Russian material. - Urea - Sales volume increased 7 percent, while the average selling price increased 65 percent, compared to the prior-year period. Improved market fundamentals account for the significant increase in prices. During the prior-year quarter, prices were near their low point in the cycle. Increased sales volume resulted from additional product available for sale from the Faustina, La., granular urea facility purchased in April 2000. - Nitrogen Solutions - Sales volume decreased 48 percent during the quarter, while the average selling price increased 90 percent compared to the same prior-year period. Higher prices were a result of a tight supply/demand environment for nitrogen solutions created by reduced industry inventory levels, concerns about available supply, and good demand. Scheduled turnarounds of ammonia and urea synthesis plants in the Yazoo City nitrogen facility reduced the product available for sale during the quarter. In addition, low water levels in the Yazoo River limited the company's ability to ship by barge, further reducing sales volume for the quarter. - Operating loss for the nitrogen segment in the first quarter decreased to $9.9 million compared to an operating loss of $12.7 million, excluding the above mentioned $3.5 million insurance claim, in the prior-year period. In addition, the current period loss of $9.9 million included $2.8 million in costs related to scheduled nitrogen plant maintenance turnarounds, while there were no turnarounds in the prior year. Phosphates phosphates (fos´fāts), n.pl the organic compounds of phosphorus. The blood phosphate level is normally 2.5 mg to 5 mg/100 ml. It is low in rickets and early hyperparathyroidism and high in tetany and nephritis. - Sales volume decreased 3 percent, while the average sales price decreased 16 percent compared to the prior-year period. Phosphate prices declined due to additional supply in the market from new plants in India India, officially Republic of India, republic (2005 est pop. 1,080,264,000), 1,261,810 sq mi (3,268,090 sq km), S Asia. The second most populous country in the world, it is also sometimes called Bharat, its ancient name. India's land frontier (c. and Australia Australia (ôstrāl`yə), smallest continent, between the Indian and Pacific oceans. With the island state of Tasmania to the south, the continent makes up the Commonwealth of Australia, a federal parliamentary state (2005 est. pop. . However, prices did show a 5 percent improvement from the quarter ending June 30, 2000, as domestic production curtailments and shutdowns affected market fundamentals. Current spot market prices are higher than this time last year, showing continued improvement in the supply/demand balance. - Operating loss for the phosphate segment was $1.9 million during the quarter compared to operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. of $2.3 million in the prior-year period. Higher ammonia cost in the current year increased production costs at the operation by approximately $2.6 million. Potash - Potash sales volume and prices were relatively unchanged compared to the prior-year period. - Operating loss for the potash segment was $2.4 million compared to operating income of $45,000 in the prior-year quarter. Cost of sales was higher compared to the prior-year period due to higher per ton beginning inventory values and high per ton production costs during the first two months of the quarter. In September September: see month. , improved ore grade Ore grade is a measure that describes the concentration of a valuable natural material (such as metals or minerals) in its surrounding ore. Ore grade is used to assess the economic feasibility of a mining operation: the cost of extracting a natural material from its ore is directly at the West mine resulted in lower per ton production costs offsetting to some extent the high cost experienced in the first two months. Higher natural gas prices paid during the quarter compared to the prior year, as well as increased turnaround Turnaround A situation where a company that has had poor performance for an extended period of time experiences a positive reversal. Notes: A speculator may profit from a turnaround if he or she accurately anticipates the improvement of a poorly performing company. cost expensed during this quarter, was partially offset by lower spending levels in other cost areas. Other operating expense Operating Expense The essential things that a company must purchase in order to maintain business. Notes: For example, the payment of employees wages are an operating expense. Also known as OPEX. on a consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: basis was $3.4 million compared to $2.5 million in the prior-year period. This increase is related to additional idle plant costs during the current quarter. Production at some nitrogen plants at both the Yazoo City and Donaldsonville complexes was idled for various periods in the quarter due to mechanical problems and the unfavorable relationship between product prices and natural gas prices. Selling, general and administrative expenses increased $161,000 compared to the prior-year period. This increase was primarily due to $787,000 of expenses related to an early retirement program completed during the quarter. Excluding the early retirement expense the company was able to reduce selling, general and administrative costs administrative costs, n.pl the overhead expenses incurred in the operation of a dental benefits program, excluding costs of dental services provided. by approximately $626,000 compared to the prior-year period. Mississippi Chemical Corporation will conduct a conference call on Tuesday Tuesday: see week. , Oct. 24 at 10 a.m. Eastern Time. This call will be available live via the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at www.misschem.com. Please allow time prior to the call to download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. and install any necessary audio software. Mississippi Chemical Corporation, through its wholly owned subsidiaries Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. , produces and markets all three primary crop nutrients. Nitrogen, phosphorus phosphorus (fŏs`fərəs) [Gr.,=light-bearing], nonmetallic chemical element; symbol P; at. no. 15; at. wt. 30.97376; m.p. 44.1°C;; b.p. about 280°C;; sp. gr. 1.82 at 20°C;; valence −3, +3, or +5. and potassium-based products are produced at facilities in Mississippi, Louisiana Louisiana (ləwē'zēăn`ə, l  ē'–), state in the S central United States. It is bounded by Mississippi, with the Mississippi R. and New Mexico New Mexico, state in the SW United States. At its northwestern corner are the so-called Four Corners, where Colorado, New Mexico, Arizona, and Utah meet at right angles; New Mexico is also bordered by Oklahoma (NE), Texas (E, S), and Mexico (S). and through a joint
venture in The Republic of Trinidad and Tobago Trinidad and Tobago (trĭn`ĭdăd, təbā`gō), officially Republic of Trinidad and Tobago, republic (2005 est. pop. 1,088,000), 1,980 sq mi (5,129 sq km), West Indies. The capital is Port of Spain. .Except for the historical statements and discussion contained herein, statements set forth in this news release constitute "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. ." These forward-looking statements rely on a number of assumptions concerning future events and other uncertainties that are beyond the company's ability to control. Readers are cautioned that actual results may differ materially from the forward-looking statements. The company's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the fiscal year ended June 30, 2000, which is on file with the Securities and Exchange Commission, identifies important factors which could cause actual results to differ materially from those indicated in the forward-looking statements. These factors include, but are not limited to, a variety of items that can materially affect fertilizer fertilizer, organic or inorganic material containing one or more of the nutrients—mainly nitrogen, phosphorus, and potassium, and other essential elements required for plant growth. demand such as planted acreage, government agricultural policies Agricultural policy describes a set of laws relating to domestic agriculture and imports of foreign agricultural products. Governments usually implement agricultural policies with the goal of achieving a specific outcome in the domestic agricultural product markets. , projected grain stocks, crop failure, weather, changes in agricultural production methods and status of certain industrial markets and the general economy; seasonal usage of fertilizer; dependence on natural gas; environmental regulations; price competition from both domestic and foreign competitors and possible delays or other problems in obtaining production, anticipated efficiencies and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. lower production costs from or as a result of expanded facilities.
MISSISSIPPI CHEMICAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited; In thousands, except per share data)
Three Months Ended
September 30,
-------------------------
2000 1999
--------- ---------
Revenues:
Net sales $ 120,053 $ 96,998
Operating expenses:
Cost of products sold 122,561 93,445
Selling, general and administrative 8,773 8,612
Other 3,436 2,540
--------- ---------
134,770 104,597
--------- ---------
Operating loss (14,717) (7,599)
Other (expense) income:
Interest, net (7,159) (6,027)
Other 1,459 635
--------- ---------
Loss before income taxes (20,417) (12,991)
Income tax benefit (8,171) (7,439)
--------- ---------
Net loss $ (12,246) $ (5,552)
========= =========
Loss per share - basic and diluted $ (0.47) $ (0.21)
========= =========
Weighted average common shares
outstanding - basic 26,132 26,132
========= =========
Weighted average common shares
outstanding - diluted 26,132 26,132
========= =========
MISSISSIPPI CHEMICAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited; In thousands)
ASSETS
Sept. 30, 2000 June 30, 2000
-------------- -------------
Current assets:
Cash and cash equivalents $ 2,041 $ 2,190
Accounts receivable, net 43,630 62,080
Inventories 73,558 72,517
Income tax receivable 10,077 10,080
Insurance receivable - 3,094
Other 9,264 10,443
--------- ---------
Total current assets 138,570 160,404
Investments in affiliates 92,140 89,508
Property held for sale 9,386 600
Other 8,835 11,288
Property, plant and equipment, net 431,197 445,854
Goodwill, net 166,034 167,179
--------- ---------
$ 846,162 $ 874,833
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Total current liabilities $ 63,215 $ 65,554
Long-term debt 322,513 330,307
Other long-term liabilities and
deferred credits 76,183 83,230
Shareholders' equity 384,251 395,742
--------- ---------
$ 846,162 $ 874,833
========= =========
MISSISSIPPI CHEMICAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited; In thousands)
Three Months Ended
September 30,
-------------------------
2000 1999
--------- ---------
Cash flows from operating activities:
Net loss $ (12,246) $ (5,552)
Reconciliation of net loss to net
cash provided by (used in)
operating activities:
Net change in operating assets
and liabilities 17,641 (16,570)
Depreciation, depletion
and amortization 12,038 11,649
Deferred income taxes (4,761) 3,300
Equity earnings in unconsolidated
affiliates (2,723) (5,896)
Other 330 (1,537)
--------- ---------
Net cash provided by (used in)
operating activities 10,279 (14,606)
--------- ---------
Cash flows from investing activities:
Purchases of property,
plant and equipment (4,495) (4,604)
Other 2,658 4,800
--------- ---------
Net cash (used in) provided by
investing activities (1,837) 196
--------- ---------
Cash flows from financing activities:
Debt proceeds 88,521 108,900
Debt payments (96,328) (91,800)
Cash dividends paid (784) (2,614)
--------- ---------
Net cash (used in) provided by
financing activities (8,591) 14,486
--------- ---------
Net (decrease) increase in cash
and cash equivalents (149) 76
Cash and cash equivalents-beginning
of period 2,190 1,648
--------- ---------
Cash and cash equivalents-end of period $ 2,041 $ 1,724
========= =========
Following are summaries of the Company's
results by product categories:
Three months ended September 30,
-------------------------------
2000 1999
-------- --------
Net sales: (in thousands)
Nitrogen $ 71,180 $ 42,022
DAP 29,380 35,755
Potash 18,905 18,939
Other 588 282
-------------------------------
$120,053 $ 96,998
===============================
Three months ended September 30,
-------------------------------
2000 1999
-------- --------
Tons sold: (in thousands)
Nitrogen
Ammonia 215 172
Ammonium nitrate 104 84
Urea 143 134
Nitrogen solutions 46 88
Nitric acid 13 14
-------------------------------
Total Nitrogen 521 492
DAP 222 229
Potash 215 217
Three months ended September 30,
-------------------------------
2000 1999
-------- --------
Average sales price per ton:
Nitrogen $137 $ 85
DAP $132 $156
Potash $ 88 $ 87
Three months ended September 30,
-------------------------------
2000 1999
-------- --------
Operating loss:
Nitrogen $ (9,863) $ (9,211)
Phosphates (1,907) 2,307
Potash (2,425) 45
Other (522) (740)
-------- --------
Total $(14,717) $ (7,599)
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