Agrium (AGU) Sees Q3 Earnings 90-95% Below Last Year's Results

October 23, 2009 7:33 AM EDT

Agrium Inc. (NYSE: AGU) announced today that it expects Q3 earnings to be 90-95% below last year's Q3 results, in line with results previously reported from industry peers for Q3.

The reduction is due to significantly lower prices and margins for all three crop nutrients, and particularly for phosphate and potash. Retail results have been negatively impacted by a slower than expected recovery in Retail crop nutrient margins in Q3 and approximately a 40% decline in fungicide sales and applications this summer. These factors will result in a significant reduction in the previously forecasted Retail EBITDA.

Despite these short-term challenges, Agrium believes the fundamentals for our businesses are excellent and we are well positioned for the anticipated strong recovery in crop input demand in 2010. Our U.S. grower customers have indicated their intention to return to normal crop nutrient application this fertilizer year, particularly now that corn prices have increased again to well above historic levels. If the wet weather in the US continues and shortens the fall application season it is expected to push fall nutrient demand into the spring of 2010.

We will provide more information in our third quarter press release and conference call scheduled for November 4, 2009.

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