Saturday, May 15, 2010

CF Industries (NYSE:CF) Projects Strong Second Quarter

With farmers planting later this year and nitrogen, phosphorus and potassium fertilizer applications behind as a result of that, it caused revenue and earnings in the first quarter for CF Industries (NYSE:CF) to underperform.

Consequently, the same conditions which led to a poor first-quarter performance should have a positive effect in the second quarter, with overall phosphate demand projected to increase in the U.S. for the 2010 by 15 percent.

The oil spill or leak in the Gulf of Mexico could adversely affect the company, as they may have to find new transportation, as much of their phosphate products come from Florida and is shipped across the Gulf and up the Mississippi River.

CF may have to ship via railroad, something the company is hoping to avoid being forced to do. Nitrogen shouldn't be hindered in any way by the oil incident. At this time they haven't had to take any of these steps, as shipping routes are still open.

Revenue in the first quarter fell to $502.4 million, a 26 percent plunge, while the company had a net loss of $4.4 million, or 9 cents a share. Last year in the same quarter CF generated earnings of $62.7 million, or $1.28 a share.

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