The Mosaic Company (NYSE: MOS) reported Q3 EPS of $0.64, $0.01 worse than the analyst estimate of $0.65. Revenue for the quarter came in at $2.93 billion versus the consensus estimate of $2.86 billion.

“We saw strong fundamentals in the third quarter, and that momentum is continuing,” said Joc O’Rourke, President and Chief Executive Officer. “We’ve increased our full year earnings guidance to reflect strong operational performance across business units, as well as improving market conditions. Our excellent progress on the transformational initiatives at Mosaic Fertilizantes is delivering tangible results to the bottom line.”

Mosaic’s net sales in the third quarter of 2018 were $2.9 billion, compared to $2.0 billion last year, primarily driven by the acquisition of Vale Fertilizantes and higher average sales prices in all three operating segments. Operating earnings during the quarter were $393 million, up from $214 million a year ago, driven by higher gross margins in all segments.

Cash flow from operating activities in the third quarter of 2018 was $524 million compared to $136 million in the prior year. Capital expenditures totaled $241 million in the quarter. The Company completed $400 million of debt retirement in the quarter, $200 million of which was previously announced. Mosaic’s total cash and cash equivalents, excluding restricted cash, were $1.0 billion, largely unchanged from a quarter ago, despite debt retirement. Long-term debt was $4.6 billion as of September 30, 2018.

“Mosaic has fulfilled our commitment to pay down $700 million of debt by 2020,” said Joc O’Rourke. “Our lower debt levels and stronger earnings outlook bring Mosaic’s balance sheet closer to our through-cycle targets. As we look ahead, our capital priorities remain unchanged: maintain a strong balance sheet and sustain our assets to ensure reliability and the safety of our people, and maintain a balanced approach to investing to grow the business and returning capital to shareholders.”

GUIDANCE:

The Mosaic Company sees FY2018 EPS of $1.80-$2.00, versus the consensus of $1.77.

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