CF Industries Reports Mixed Q3 Results, 7.6% Net Sales Growth, Despite 13% Decline in Nine-Month Sales

CF Industries Holdings, Inc. reported its financial results for the third quarter and the first nine months of 2024, highlighting a mixed performance in net sales and profitability compared to the previous fiscal period.

For the three months ended September 30, 2024, net sales reached $1,370 million, a 7.6% increase from $1,273 million in the same period of 2023. This growth was primarily driven by the acquisition of the Waggaman ammonia production facility, which contributed approximately $77 million to sales. The average selling price for nitrogen products rose by 7% to $286 per ton, adding approximately $52 million to net sales. Sales volume increased slightly to 4.8 million tons from 4.7 million tons year-over-year.

In contrast, net sales for the nine months ended September 30, 2024, totaled $4,412 million, down 13% from $5,060 million in the same period of 2023. This decline was attributed to a 13% decrease in average selling prices, which fell to $311 per ton from $356 per ton, resulting in a $680 million decrease in net sales.

Gross margin for the third quarter of 2024 was $444 million, up from $377 million in the prior year, reflecting an 18% increase. Operating earnings also improved significantly, rising to $364 million from $244 million, a 49% increase. However, for the nine-month period, gross margin decreased to $1,532 million from $2,044 million, and operating earnings fell to $1,305 million from $1,804 million, marking a 28% decline.

Net earnings attributable to common stockholders for the third quarter were $276 million, a substantial increase of 68% from $164 million in the same quarter of 2023. For the nine months, net earnings decreased to $890 million from $1,251 million, a 29% decline. Diluted earnings per share for the third quarter rose to $1.55 from $0.85, while for the nine months, it decreased to $4.86 from $6.42.

The company declared dividends of $0.50 per share for the third quarter, up from $0.40 in the same period last year, reflecting a 25% increase. Cash and cash equivalents as of September 30, 2024, were $1,877 million, down from $2,032 million at the end of 2023, primarily due to share repurchases and capital expenditures.

Strategically, CF Industries completed the acquisition of the Waggaman ammonia production facility on December 1, 2023, for a final purchase price of $1.221 billion. The facility is expected to enhance the company's low-carbon ammonia production capabilities. Integration costs related to this acquisition were $4 million for the nine months ended September 30, 2024, compared to $25 million in the same period of 2023.

Overall, while CF Industries experienced growth in the third quarter, the nine-month results reflected challenges in pricing and profitability, influenced by market conditions and strategic investments.