Agrium Expands Production Facility - Analyst Blog


Agrium Inc. ( AGU ) announced that it has begun the construction of its production expansion project at Agrium Advanced Technologies ( AAT ) Environmentally Smart Nitrogen (ESN) facility in New Madrid, Missouri. It is a $28 million project, which is scheduled to be completed in the third quarter of 2012.

The new facility is expected to add another 136,000 tons to its output, bringing it to a targeted capacity level of 246,000 tons per year at the operations. After the expansion, total ESN capacity for AAT will be 464,000 tonnes.

AAT ESN, a nitrogen-based fertilizer, is designed for higher yields. Agrium remains confident that the expansion will not only enable it to continue meeting the ESN demand in North America but also boost the growth of the unique product in the future.

Agrium posted record net earnings of $374 million or $2.34 per share in the fourth quarter of 2011 versus $135 million or 86 cents per share in the prior-year quarter, outpacing the Zacks Consensus Estimate of $2.00 per share. In fiscal 2011, net earnings were $1.4 billion or $8.68 per share compared with $713 million or $4.51 per share in fiscal 2010.

Results benefited from record high crop prices and overall strong fundamentals in agriculture and the crop input markets. Revenues in the quarter rose 32.5% year over year to $3.18 billion. Revenue for the year was $15.47 billion, up from $10.74 billion in the prior year.

Though the company did not provide any specific estimates for its 2012 revenue and net income, it expects global demand for fertilizers and seeds to be strong throughout the year. Historically, higher corn prices should boost demand for seeds, while demand for nitrogen fertilizer could rise in 2012. Agrium expects strong nutrient demand in the first half of 2012 supported by the continued strength in crop prices.

Agrium faces stiff competition from CF Industries Holdings Inc. ( CF ) and Potash Corp. of Saskatchewan Inc. ( POT ). Currently, the company maintains a Zacks #3 Rank which translates into short-term (1 to 3 months) Hold rating.

AGRIUM INC ( AGU ): Free Stock Analysis Report
CF INDUS HLDGS ( CF ): Free Stock Analysis Report

POTASH SASK ( POT ): Free Stock Analysis Report
To read this article on click here.
Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: AAT , AGU , CF , POT

More from

Related Videos




Most Active by Volume

  • $15.52 ▲ 1.37%
  • $31.46 ▼ 1.69%
  • $126.37 ▲ 2.53%
  • $59.83 ▲ 23.82%
  • $8.76 ▲ 2.22%
  • $42.82 ▼ 3.54%
  • $40.96 ▼ 0.02%
  • $8.80 ▼ 6.98%
As of 3/30/2015, 04:15 PM

Find a Credit Card

Select a credit card product by:
Select an offer:
Data Provided by