UPDATE 2-Agrium profit hit by frigid winter, lower fertilizer prices

Tue May 6, 2014 7:59pm EDT
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(Adds sales details, share prices)

By Rod Nickel

May 6 (Reuters) - Canada's Agrium Inc reported on Tuesday a steep drop in first-quarter profit, hurt by a colder than usual winter across North America and a drop in fertilizer prices.

As the cold weather caused transportation problems and delayed spring planting in some areas, net earnings from continuing operations for the first quarter fell to $12 million, or 8 cents per share, from $146 million, or 98 cents per share a year ago.

"Agrium's first quarter is traditionally our seasonally lowest earnings quarter and this was exacerbated this year by the record cold winter across North America," Chief Executive Chuck Magro said. "However, farmer sentiment is positive this spring and we are now seeing good demand for crop input products and services."

Agrium forecast earnings of $3.85 to $4.35 per share for the busy second quarter, weakened by a March 22 outage at its Carseland, Alberta nitrogen facility. Analysts on average had expected $4.98.

The plant shutdown is likely to cut second-quarter availability of urea by about 130,000 tonnes, and of ammonia by about 30,000 tonnes.

Agrium is North America's biggest retail seller of seed, fertilizer and chemicals directly to farmers and also produces nitrogen, potash and phosphate fertilizer. The frigid winter and a record-large Canadian harvest last autumn overwhelmed Canadian railways that also transport the potash Agrium produces.

Excluding one-time items, earnings from continuing operations were $11 million, or 7 cents per share. On that basis, analysts on average had expected 5 cents a share in the first quarter, according to Thomson Reuters I/B/E/S.   Continued...