TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Table of Contents | ||||
PART I. | FINANCIAL INFORMATION | |||
Item 1. | ||||
Item 2. | ||||
Item 3. | ||||
Item 4. | ||||
PART II. | OTHER INFORMATION | |||
Item 1. | ||||
Item 1A. | ||||
Item 2. | ||||
Item 4. | ||||
Item 6. | ||||
Three months ended | Nine months ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Net sales | $ | $ | $ | $ | |||||||||||
Cost of goods sold | |||||||||||||||
Gross margin | |||||||||||||||
Selling, general and administrative expenses | |||||||||||||||
Plant City closure (benefit) costs | ( | ) | |||||||||||||
Other operating expense | |||||||||||||||
Operating earnings | |||||||||||||||
Interest expense, net | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
Foreign currency transaction (loss) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
Other income (expense) | ( | ) | ( | ) | |||||||||||
Earnings (loss) from consolidated companies before income taxes | ( | ) | |||||||||||||
Provision for income taxes | |||||||||||||||
(Loss) earnings from consolidated companies | ( | ) | ( | ) | |||||||||||
Equity in net (loss) of nonconsolidated companies | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
Net (loss) earnings including noncontrolling interests | ( | ) | ( | ) | |||||||||||
Less: Net gain attributable to noncontrolling interests | |||||||||||||||
Net (loss) earnings attributable to Mosaic | $ | ( | ) | $ | $ | ( | ) | $ | |||||||
Basic net (loss) earnings per share attributable to Mosaic | $ | ( | ) | $ | $ | ( | ) | $ | |||||||
Basic weighted average number of shares outstanding | |||||||||||||||
Diluted net (loss) earnings per share attributable to Mosaic | $ | ( | ) | $ | $ | ( | ) | $ | |||||||
Diluted weighted average number of shares outstanding | |||||||||||||||
Three months ended | Nine months ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Net (loss) earnings including noncontrolling interest | $ | ( | ) | $ | $ | ( | ) | $ | |||||||
Other comprehensive (loss) income, net of tax | |||||||||||||||
Foreign currency translation (loss) gain, net of tax | ( | ) | ( | ) | ( | ) | |||||||||
Net actuarial gain and prior service cost, net of tax | |||||||||||||||
Amortization of gain on interest rate swap, net of tax | |||||||||||||||
Net (loss) gain on marketable securities held in trust fund, net of tax | ( | ) | ( | ) | |||||||||||
Other comprehensive (loss) income | ( | ) | ( | ) | ( | ) | |||||||||
Comprehensive (loss) income | ( | ) | ( | ) | ( | ) | |||||||||
Less: Comprehensive income (loss) attributable to noncontrolling interest | ( | ) | |||||||||||||
Comprehensive (loss) income attributable to Mosaic | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | |||||
September 30, 2019 | December 31, 2018 | |||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | $ | ||||||
Receivables, net | ||||||||
Inventories | ||||||||
Other current assets | ||||||||
Total current assets | ||||||||
Property, plant and equipment, net of accumulated depreciation of $7,527.0 million and $6,934.5 million, respectively | ||||||||
Investments in nonconsolidated companies | ||||||||
Goodwill | ||||||||
Deferred income taxes | ||||||||
Other assets | ||||||||
Total assets | $ | $ | ||||||
Liabilities and Equity | ||||||||
Current liabilities: | ||||||||
Short-term debt | $ | $ | ||||||
Current maturities of long-term debt | ||||||||
Structured accounts payable arrangements | ||||||||
Accounts payable | ||||||||
Accrued liabilities | ||||||||
Total current liabilities | ||||||||
Long-term debt, less current maturities | ||||||||
Deferred income taxes | ||||||||
Other noncurrent liabilities | ||||||||
Equity: | ||||||||
Preferred Stock, $0.01 par value, 15,000,000 shares authorized, none issued and outstanding as of September 30, 2019 and December 31, 2018 | ||||||||
Common Stock, $0.01 par value, 1,000,000,000 shares authorized, 389,643,771 shares issued and 380,045,964 shares outstanding as of September 30, 2019, 389,242,360 shares issued and 385,470,085 shares outstanding as of December 31, 2018 | ||||||||
Capital in excess of par value | ||||||||
Retained earnings | ||||||||
Accumulated other comprehensive loss | ( | ) | ( | ) | ||||
Total Mosaic stockholders' equity | ||||||||
Noncontrolling interests | ||||||||
Total equity | ||||||||
Total liabilities and equity | $ | $ | ||||||
Nine months ended | ||||||||
September 30, 2019 | September 30, 2018 | |||||||
Cash Flows from Operating Activities: | ||||||||
Net (loss) earnings including noncontrolling interests | $ | ( | ) | $ | ||||
Adjustments to reconcile net (loss) earnings including noncontrolling interests to net cash provided by operating activities: | ||||||||
Depreciation, depletion and amortization | ||||||||
Amortization of acquired inventory | ( | ) | ( | ) | ||||
Deferred and other income taxes | ( | ) | ( | ) | ||||
Equity in net loss of nonconsolidated companies, net of dividends | ||||||||
Accretion expense for asset retirement obligations | ||||||||
Share-based compensation expense | ||||||||
Unrealized loss (gain) on derivatives | ( | ) | ||||||
Plant City closure costs | ||||||||
Loss on sale of fixed assets | ||||||||
Other | ( | ) | ||||||
Changes in assets and liabilities, excluding effects of acquisition: | ||||||||
Receivables, net | ( | ) | ||||||
Inventories | ( | ) | ( | ) | ||||
Other current and noncurrent assets | ( | ) | ( | ) | ||||
Accounts payable and accrued liabilities | ||||||||
Other noncurrent liabilities | ( | ) | ||||||
Net cash provided by operating activities | ||||||||
Cash Flows from Investing Activities: | ||||||||
Capital expenditures | ( | ) | ( | ) | ||||
Purchases of available-for-sale securities - restricted | ( | ) | ( | ) | ||||
Proceeds from sale of available-for-sale securities - restricted | ||||||||
Investments in consolidated affiliate | ( | ) | ||||||
Proceeds from sale of fixed assets | ||||||||
Acquisition, net of cash acquired | ( | ) | ||||||
Purchase of assets | ( | ) | ||||||
Purchases of held-to-maturity securities | ( | ) | ||||||
Proceeds from sale of held-to-maturity securities | ||||||||
Other | ( | ) | ||||||
Net cash used in investing activities | ( | ) | ( | ) | ||||
Cash Flows from Financing Activities: | ||||||||
Payments of short-term debt | ( | ) | ( | ) | ||||
Proceeds from issuance of short-term debt | ||||||||
Payments of structured accounts payable arrangements | ( | ) | ( | ) | ||||
Proceeds from structured accounts payable arrangements | ||||||||
Payments of long-term debt | ( | ) | ( | ) | ||||
Proceeds from issuance of long-term debt | ||||||||
Repurchases of stock | ( | ) | ||||||
Cash dividends paid | ( | ) | ( | ) | ||||
Other | ( | ) | ( | ) | ||||
Net cash used in financing activities | ( | ) | ( | ) | ||||
Effect of exchange rate changes on cash | ( | ) | ||||||
Net change in cash, cash equivalents and restricted cash | ( | ) | ( | ) | ||||
Cash, cash equivalents and restricted cash - December 31 | ||||||||
Cash, cash equivalents and restricted cash - September 30 | $ | $ | ||||||
Nine months ended | |||||||
September 30, 2019 | September 30, 2018 | ||||||
Reconciliation of cash, cash equivalents and restricted cash reported within the unaudited condensed consolidated balance sheets to the unaudited condensed consolidated statements of cash flows: | |||||||
Cash and cash equivalents | $ | $ | |||||
Restricted cash in other current assets | |||||||
Restricted cash in other assets | |||||||
Total cash, cash equivalents and restricted cash shown in the unaudited condensed consolidated statement of cash flows | $ | $ | |||||
Supplemental Disclosure of Cash Flow Information: | |||||||
Cash paid during the period for: | |||||||
Interest (net of amount capitalized of $20.9 and $17.0 for the nine months ended September 30, 2019 and 2018, respectively) | $ | $ | |||||
Income taxes (net of refunds) | |||||||
Mosaic Shareholders | ||||||||||||||||||||||||||
Shares | Dollars | |||||||||||||||||||||||||
Capital in Excess of Par Value | Accumulated Other Comprehensive (Loss) | |||||||||||||||||||||||||
Common Stock | Common Stock | Retained Earnings | Noncontrolling Interests | Total Equity | ||||||||||||||||||||||
Balance as of June 30, 2018 | $ | $ | $ | $ | ( | ) | $ | $ | ||||||||||||||||||
Total comprehensive income | — | — | — | |||||||||||||||||||||||
Vesting of restricted stock units | — | ( | ) | — | — | — | ( | ) | ||||||||||||||||||
Stock based compensation | — | — | — | — | — | |||||||||||||||||||||
Dividends ($0.025 per share) | — | — | — | ( | ) | — | — | ( | ) | |||||||||||||||||
Dividends for noncontrolling interests | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||
Equity from noncontrolling interests | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||
Balance as of September 30, 2018 | $ | $ | $ | $ | ( | ) | $ | $ | ||||||||||||||||||
Balance as of December 31, 2017 | $ | $ | $ | $ | ( | ) | $ | $ | ||||||||||||||||||
Adoption of ASC Topic 606 | — | — | — | — | — | |||||||||||||||||||||
Total comprehensive income (loss) | — | — | — | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Vesting of restricted stock units | — | ( | ) | — | — | — | ( | ) | ||||||||||||||||||
Stock based compensation | — | — | — | — | — | |||||||||||||||||||||
Acquisition of Vale Fertilizantes | — | — | — | |||||||||||||||||||||||
Dividends ($0.05 per share) | — | — | — | ( | ) | — | — | ( | ) | |||||||||||||||||
Dividends for noncontrolling interests | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||
Equity from noncontrolling interests | — | — | — | — | — | |||||||||||||||||||||
Balance as of September 30, 2018 | $ | $ | $ | $ | ( | ) | $ | $ | ||||||||||||||||||
Balance as of June 30, 2019 | $ | $ | $ | $ | ( | ) | $ | $ | ||||||||||||||||||
Total comprehensive income (loss) | — | — | — | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Stock based compensation | — | — | — | — | — | |||||||||||||||||||||
Share repurchases | ( | ) | — | ( | ) | — | — | — | ( | ) | ||||||||||||||||
Dividends ($0.05 per share) | — | — | — | ( | ) | — | — | ( | ) | |||||||||||||||||
Dividends for noncontrolling interests | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||
Balance as of September 30, 2019 | $ | $ | $ | $ | ( | ) | $ | $ | ||||||||||||||||||
Balance as of December 31, 2018 | ( | ) | ||||||||||||||||||||||||
Adoption of ASC Topic 842 | — | — | — | — | — | |||||||||||||||||||||
Total comprehensive income (loss) | — | — | — | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Vesting of restricted stock units | — | ( | ) | — | — | — | ( | ) | ||||||||||||||||||
Stock based compensation | — | — | — | — | — | |||||||||||||||||||||
Share repurchases | ( | ) | — | ( | ) | — | — | — | ( | ) | ||||||||||||||||
Dividends ($0.10 per share) | — | — | — | ( | ) | — | — | ( | ) | |||||||||||||||||
Dividends for noncontrolling interests | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||
Balance as of September 30, 2019 | $ | $ | $ | $ | ( | ) | $ | $ | ||||||||||||||||||
• | Our Phosphates business segment owns and operates mines and production facilities in Florida which produce concentrated phosphate crop nutrients and phosphate-based animal feed ingredients, and processing plants in Louisiana which produce concentrated phosphate crop nutrients. As part of the Acquisition, we acquired an additional |
• | Our Potash business segment owns and operates potash mines and production facilities in Canada and the U.S. which produce potash-based crop nutrients, animal feed ingredients and industrial products. Potash sales include domestic and international sales. We are a member of Canpotex, Limited (“Canpotex”), an export association of Canadian potash producers through which we sell our Canadian potash outside the U.S. and Canada. |
• | Our Mosaic Fertilizantes business segment includes the assets in Brazil that we acquired in the Acquisition, which consist of five phosphate rock mines, four phosphate chemical plants and a potash mine. The segment also includes our legacy distribution business in South America, which consists of sales offices, crop nutrient blending and bagging facilities, port terminals and warehouses in Brazil and Paraguay. We also have a majority interest in Fospar S.A., which owns and operates a single superphosphate granulation plant and a deep-water crop nutrition port and throughput warehouse terminal facility in Brazil. |
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
Balance as of | Adoption | Balance as of | ||||||||||
December 31, 2018 | Adjustments | January 1, 2019 | ||||||||||
(in millions) | ||||||||||||
Operating lease right-of-use assets | $ | $ | $ | |||||||||
Finance lease right-of-use assets | ||||||||||||
Accrued and other noncurrent liabilities | ||||||||||||
Long-term debt, including current maturities | ||||||||||||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
Three Months Ended September 30, 2019 | Nine Months Ended September 30, 2019 | |||||||
(in millions) | ||||||||
Operating lease cost | $ | $ | ||||||
Finance lease cost: | ||||||||
Amortization of right-of-use assets | $ | $ | ||||||
Interest on lease liabilities | ||||||||
$ | $ | |||||||
Short-term lease cost | $ | $ | ||||||
Variable lease cost | ||||||||
Total lease cost | $ | $ | ||||||
Nine Months Ended September 30, 2019 | ||||
(In millions) | ||||
Cash paid for amounts included in the measurement of lease liabilities: | ||||
Operating cash flows from operating leases | $ | |||
Operating cash flows from finance leases | $ | |||
Financing cash flows from finance leases | $ | |||
Right-of-use assets obtained in exchange for lease obligations: | ||||
Operating leases | $ | |||
Finance leases | $ | |||
September 30, 2019 | |||
Weighted Average Remaining Lease Term | |||
Operating leases | |||
Finance leases | |||
Weighted Average Discount Rate | |||
Operating leases | % | ||
Finance leases | % | ||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
Operating Leases | Finance Leases | |||||||
(in millions) | ||||||||
2019 (excluding the nine months ended September 30, 2019) | $ | $ | ||||||
2020 | ||||||||
2021 | ||||||||
2022 | ||||||||
2023 | ||||||||
Thereafter | ||||||||
Total future lease payments | $ | $ | ||||||
Less imputed interest | ( | ) | ( | ) | ||||
Total | $ | $ | ||||||
Reported as of September 30, 2019 | ||||||||
Accrued liabilities | $ | $ | — | |||||
Current maturities of long-term debt | — | |||||||
Other noncurrent liabilities | — | |||||||
Long-term debt, less current maturities | — | |||||||
Total | $ | $ | ||||||
(in millions) | Operating Leases | Capital Leases | ||||||
2019 | $ | $ | ||||||
2020 | ||||||||
2021 | ||||||||
2022 | ||||||||
2023 | ||||||||
Subsequent years | ||||||||
$ | $ | |||||||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
September 30, 2019 | December 31, 2018 | |||||||
Other current assets | ||||||||
Income and other taxes receivable | $ | $ | ||||||
Prepaid expenses | ||||||||
Other | ||||||||
$ | $ | |||||||
Other assets | ||||||||
Restricted cash | $ | $ | ||||||
MRO inventory | ||||||||
Marketable securities held in trust | ||||||||
Operating lease right-of-use assets | ||||||||
Indemnification asset | ||||||||
Long-term receivable | ||||||||
Other | ||||||||
$ | $ | |||||||
Accrued liabilities | ||||||||
Accrued dividends | $ | $ | ||||||
Payroll and employee benefits | ||||||||
Asset retirement obligations | ||||||||
Customer prepayments (a) | ||||||||
Accrued income tax | ||||||||
Operating lease obligation | ||||||||
Other | ||||||||
$ | $ | |||||||
Other noncurrent liabilities | ||||||||
Asset retirement obligations | $ | $ | ||||||
Operating lease obligation | ||||||||
Accrued pension and postretirement benefits | ||||||||
Unrecognized tax benefits | ||||||||
Other | ||||||||
$ | $ | |||||||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
Three months ended | Nine months ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Net (loss) earnings attributable to Mosaic | $ | ( | ) | $ | $ | ( | ) | $ | |||||||
Basic weighted average number of shares outstanding | |||||||||||||||
Dilutive impact of share-based awards | |||||||||||||||
Diluted weighted average number of shares outstanding | |||||||||||||||
Basic net (loss) earnings per share attributable to Mosaic | $ | ( | ) | $ | $ | ( | ) | $ | |||||||
Diluted net (loss) earnings per share attributable to Mosaic | $ | ( | ) | $ | $ | ( | ) | $ | |||||||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
September 30, 2019 | December 31, 2018 | |||||||
Raw materials | $ | $ | ||||||
Work in process | ||||||||
Finished goods | ||||||||
Final price deferred(a) | ||||||||
Operating materials and supplies | ||||||||
$ | $ | |||||||
(a) |
Phosphates | Potash | Mosaic Fertilizantes | Corporate, Eliminations and Other | Total | |||||||||||||||
Balance as of December 31, 2018 | $ | $ | $ | $ | $ | ||||||||||||||
Foreign currency translation | ( | ) | |||||||||||||||||
Balance as of September 30, 2019 | $ | $ | $ | $ | $ | ||||||||||||||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
September 30, 2019 | |||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||
Level 1 | |||||||||||||||
Cash and cash equivalents | $ | $ | $ | $ | |||||||||||
Level 2 | |||||||||||||||
Corporate debt securities | ( | ) | |||||||||||||
Municipal bonds | ( | ) | |||||||||||||
U.S. government bonds | ( | ) | |||||||||||||
Total | $ | $ | $ | ( | ) | $ | |||||||||
December 31, 2018 | |||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||
Level 1 | |||||||||||||||
Cash and cash equivalents | $ | $ | $ | $ | |||||||||||
Level 2 | |||||||||||||||
Corporate debt securities | ( | ) | |||||||||||||
Municipal bonds | ( | ) | |||||||||||||
U.S. government bonds | |||||||||||||||
Total | $ | $ | $ | ( | ) | $ | |||||||||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
September 30, 2019 | December 31, 2018 | ||||||||||||||
Less than 12 months | Less than 12 months | ||||||||||||||
Fair Value | Gross Unrealized Losses(a) | Fair Value | Gross Unrealized Losses(a) | ||||||||||||
Corporate debt securities | $ | $ | $ | $ | ( | ) | |||||||||
Municipal bonds | ( | ) | |||||||||||||
U.S. government bonds | ( | ) | |||||||||||||
Total | $ | $ | ( | ) | $ | $ | ( | ) | |||||||
September 30, 2019 | December 31, 2018 | ||||||||||||||
Greater than 12 months | Greater than 12 months | ||||||||||||||
Fair Value | Gross Unrealized Losses(a) | Fair Value | Gross Unrealized Losses(a) | ||||||||||||
Corporate debt securities | $ | $ | ( | ) | $ | $ | ( | ) | |||||||
Municipal bonds | ( | ) | ( | ) | |||||||||||
U.S. government bonds | |||||||||||||||
Total | $ | $ | ( | ) | $ | $ | ( | ) | |||||||
(a) | Represents the aggregate of the gross unrealized losses that have been in a continuous unrealized loss position as of September 30, 2019 and December 31, 2018. |
September 30, 2019 | |||
Due in one year or less | $ | ||
Due after one year through five years | |||
Due after five years through ten years | |||
Due after ten years | |||
Total debt securities | $ | ||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
(in millions) | September 30, 2019 | December 31, 2018 | |||||
AROs, beginning of period | $ | $ | |||||
Liabilities acquired in the Acquisition | |||||||
Liabilities incurred | |||||||
Liabilities settled | ( | ) | ( | ) | |||
Accretion expense | |||||||
Revisions in estimated cash flows | |||||||
Foreign currency translation | ( | ) | ( | ) | |||
AROs, end of period | |||||||
Less current portion | |||||||
$ | $ | ||||||
• | Modification of certain operating practices and undertaking certain capital improvement projects over a period of several years that are expected to result in capital expenditures likely to exceed $ |
• | Provision of additional financial assurance for the estimated Gypstack Closure Costs for Gypstacks at the covered facilities. The RCRA Trusts are discussed in Note 10 to our Condensed Consolidated Financial Statements. In |
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
(in millions of Units) | September 30, 2019 | December 31, 2018 | |||||||
Derivative Instrument | Derivative Category | Unit of Measure | |||||||
Foreign currency derivatives | Foreign currency | US Dollars | |||||||
Interest rate derivatives | Interest rate | US Dollars | |||||||
Natural gas derivatives | Commodity | MMbtu | |||||||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
September 30, 2019 | December 31, 2018 | |||||||||||||||
Carrying Amount | Fair Value | Carrying Amount | Fair Value | |||||||||||||
Cash and cash equivalents | $ | $ | $ | $ | ||||||||||||
Accounts Receivables | ||||||||||||||||
Accounts payable | ||||||||||||||||
Structured accounts payable arrangements | ||||||||||||||||
Short-term debt | ||||||||||||||||
Long-term debt, including current portion | ||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Transactions with non-consolidated companies included in net sales | $ | $ | $ | $ | |||||||||||
Transactions with non-consolidated companies included in cost of goods sold | |||||||||||||||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
Foreign Currency Translation Gain (Loss) | Net Actuarial Gain and Prior Service Cost | Amortization of Gain on Interest Rate Swap | Net Gain (Loss) on Marketable Securities Held in Trust | Total | |||||||||||||||
Balance at December 31, 2018 | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | ||||||
Other comprehensive income (loss) | ( | ) | ( | ) | |||||||||||||||
Amount attributable to noncontrolling interest | |||||||||||||||||||
Balance at September 30, 2019 | $ | ( | ) | $ | ( | ) | $ | $ | $ | ( | ) | ||||||||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
Phosphates | Potash | Mosaic Fertilizantes | Corporate, Eliminations and Other (a) | Total | |||||||||||||||
Three months ended September 30, 2019 | |||||||||||||||||||
Net sales to external customers | $ | $ | $ | $ | $ | ||||||||||||||
Intersegment net sales | ( | ) | |||||||||||||||||
Net sales | ( | ) | |||||||||||||||||
Gross margin | ( | ) | |||||||||||||||||
Canadian resource taxes | |||||||||||||||||||
Gross margin (excluding Canadian resource taxes) | ( | ) | |||||||||||||||||
Operating earnings (loss) | ( | ) | ( | ) | |||||||||||||||
Capital expenditures | |||||||||||||||||||
Depreciation, depletion and amortization expense | |||||||||||||||||||
Three months ended September 30, 2018 | |||||||||||||||||||
Net sales to external customers | $ | $ | $ | $ | $ | ||||||||||||||
Intersegment net sales | ( | ) | |||||||||||||||||
Net sales | ( | ) | |||||||||||||||||
Gross margin | |||||||||||||||||||
Canadian resource taxes | |||||||||||||||||||
Gross margin (excluding Canadian resource taxes) | |||||||||||||||||||
Operating earnings (loss) | ( | ) | |||||||||||||||||
Capital expenditures | |||||||||||||||||||
Depreciation, depletion and amortization expense | |||||||||||||||||||
Nine months ended September 30, 2019 | |||||||||||||||||||
Net sales to external customers | $ | $ | $ | $ | $ | ||||||||||||||
Intersegment net sales | ( | ) | |||||||||||||||||
Net sales | ( | ) | |||||||||||||||||
Gross margin | |||||||||||||||||||
Canadian resource taxes | |||||||||||||||||||
Gross margin (excluding Canadian resource taxes) | |||||||||||||||||||
Operating earnings (loss) | ( | ) | ( | ) | |||||||||||||||
Capital expenditures | |||||||||||||||||||
Depreciation, depletion and amortization expense | |||||||||||||||||||
Nine months ended September 30, 2018 | |||||||||||||||||||
Net sales to external customers | $ | $ | $ | $ | $ | ||||||||||||||
Intersegment net sales | ( | ) | |||||||||||||||||
Net sales | ( | ) | |||||||||||||||||
Gross margin | ( | ) | |||||||||||||||||
Canadian resource taxes | |||||||||||||||||||
Gross margin (excluding Canadian resource taxes) | ( | ) | |||||||||||||||||
Operating earnings (loss) | ( | ) | |||||||||||||||||
Capital expenditures | |||||||||||||||||||
Depreciation, depletion and amortization expense | |||||||||||||||||||
(a) | The “Corporate, Eliminations and Other” category includes the results of our ancillary distribution operations in India and China. For the three and nine months ended September 30, 2019, distribution operations in India and China had revenue of $ |
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(in millions) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Net sales(a): | |||||||||||||||
Brazil | $ | $ | $ | $ | |||||||||||
Canpotex(b) | |||||||||||||||
Canada | |||||||||||||||
China | |||||||||||||||
India | |||||||||||||||
Mexico | |||||||||||||||
Argentina | |||||||||||||||
Australia | |||||||||||||||
Paraguay | |||||||||||||||
Peru | |||||||||||||||
Colombia | |||||||||||||||
Chile | |||||||||||||||
Thailand | |||||||||||||||
Dominican Republic | |||||||||||||||
Japan | |||||||||||||||
Honduras | |||||||||||||||
Other | |||||||||||||||
Total international countries | |||||||||||||||
United States | |||||||||||||||
Consolidated | $ | $ | $ | $ | |||||||||||
(a) | Revenues are attributed to countries based on location of customer. |
(b) | Canpotex is the export association of the Saskatchewan potash producers. |
THE MOSAIC COMPANY | ||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) | ||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(in millions) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Sales by product type: | |||||||||||||||
Phosphate Crop Nutrients | $ | $ | $ | $ | |||||||||||
Potash Crop Nutrients | |||||||||||||||
Crop Nutrient Blends | |||||||||||||||
Specialty Products(a) | |||||||||||||||
Phosphate Rock | |||||||||||||||
Other(b) | |||||||||||||||
$ | $ | $ | $ | ||||||||||||
(a) | Includes sales of MicroEssentials®, K-Mag, Aspire and animal feed ingredients. |
(b) | Includes sales of industrial potash, nitrogen and other products. |
Three months ended | Nine months ended | ||||||||||||||||||||||||||||
September 30, | 2019-2018 | September 30, | 2019-2018 | ||||||||||||||||||||||||||
(in millions, except per share data) | 2019 | 2018 | Change | Percent | 2019 | 2018 | Change | Percent | |||||||||||||||||||||
Net sales | $ | 2,753.4 | $ | 2,928.1 | $ | (174.7 | ) | (6 | )% | $ | 6,830.0 | $ | 7,066.8 | $ | (236.8 | ) | (3 | )% | |||||||||||
Cost of goods sold | 2,473.5 | 2,432.6 | 40.9 | 2 | % | 6,013.4 | 6,034.6 | (21.2 | ) | 0 | % | ||||||||||||||||||
Gross margin | 279.9 | 495.5 | (215.6 | ) | (44 | )% | 816.6 | 1,032.2 | (215.6 | ) | (21 | )% | |||||||||||||||||
Gross margin percentage | 10 | % | 17 | % | 12 | % | 15 | % | |||||||||||||||||||||
Selling, general and administrative expenses | 78.2 | 78.5 | (0.3 | ) | 0 | % | 249.8 | 251.4 | (1.6 | ) | (1 | )% | |||||||||||||||||
Plant City closure (benefit) costs | (15.6 | ) | — | (15.6 | ) | NM | 353.8 | — | 353.8 | NM | |||||||||||||||||||
Other operating expense | 77.8 | 23.7 | 54.1 | NM | 113.3 | 110.5 | 2.8 | 3 | % | ||||||||||||||||||||
Operating earnings | 139.5 | 393.3 | (253.8 | ) | (65 | )% | 99.7 | 670.3 | (570.6 | ) | (85 | )% | |||||||||||||||||
Interest expense, net | (43.2 | ) | (40.9 | ) | (2.3 | ) | 6 | % | (136.2 | ) | (135.4 | ) | (0.8 | ) | 1 | % | |||||||||||||
Foreign currency transaction (loss) | (53.8 | ) | (2.2 | ) | (51.6 | ) | NM | (10.4 | ) | (113.1 | ) | 102.7 | (91 | )% | |||||||||||||||
Other income (expense) | 9.7 | (7.6 | ) | 17.3 | NM | 4.9 | (15.6 | ) | 20.5 | NM | |||||||||||||||||||
Earnings (loss) from consolidated companies before income taxes | 52.2 | 342.6 | (290.4 | ) | (85 | )% | (42.0 | ) | 406.2 | (448.2 | ) | NM | |||||||||||||||||
Provision for income taxes | 69.2 | 90.6 | (21.4 | ) | (24 | )% | 64.1 | 44.4 | 19.7 | 44 | % | ||||||||||||||||||
(Loss) earnings from consolidated companies | (17.0 | ) | 252.0 | (269.0 | ) | NM | (106.1 | ) | 361.8 | (467.9 | ) | NM | |||||||||||||||||
Equity in net (loss) of nonconsolidated companies | (23.0 | ) | (2.3 | ) | (20.7 | ) | NM | (34.3 | ) | (3.9 | ) | (30.4 | ) | NM | |||||||||||||||
Net (loss) earnings including noncontrolling interests | (40.0 | ) | 249.7 | (289.7 | ) | NM | (140.4 | ) | 357.9 | (498.3 | ) | NM | |||||||||||||||||
Less: Net gain attributable to noncontrolling interests | 4.1 | 2.2 | 1.9 | 86 | % | 6.0 | 0.2 | 5.8 | NM | ||||||||||||||||||||
Net (loss) earnings attributable to Mosaic | $ | (44.1 | ) | $ | 247.5 | $ | (291.6 | ) | NM | $ | (146.4 | ) | $ | 357.7 | $ | (504.1 | ) | NM | |||||||||||
Diluted net (loss) earnings per share attributable to Mosaic | $ | (0.11 | ) | $ | 0.64 | $ | (0.75 | ) | NM | $ | (0.38 | ) | $ | 0.93 | $ | (1.31 | ) | NM | |||||||||||
Diluted weighted average number of shares outstanding | 385.0 | 387.5 | 385.5 | 386.1 | |||||||||||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||||||||||||||
September 30, | 2019-2018 | September 30, | 2019-2018 | ||||||||||||||||||||||||||
(in millions, except price per tonne or unit) | 2019 | 2018 | Change | Percent | 2019 | 2018 | Change | Percent | |||||||||||||||||||||
Net sales: | |||||||||||||||||||||||||||||
North America | $ | 484.1 | $ | 626.5 | $ | (142.4 | ) | (23 | )% | $ | 1,326.6 | $ | 1,691.4 | $ | (364.8 | ) | (22 | )% | |||||||||||
International | 335.8 | 415.0 | (79.2 | ) | (19 | )% | 1,216.7 | 1,269.2 | (52.5 | ) | (4 | )% | |||||||||||||||||
Total | 819.9 | 1,041.5 | (221.6 | ) | (21 | )% | 2,543.3 | 2,960.6 | (417.3 | ) | (14 | )% | |||||||||||||||||
Cost of goods sold | 839.2 | 861.5 | (22.3 | ) | (3 | )% | 2,519.6 | 2,530.3 | (10.7 | ) | 0 | % | |||||||||||||||||
Gross margin | $ | (19.3 | ) | $ | 180.0 | $ | (199.3 | ) | NM | $ | 23.7 | $ | 430.3 | $ | (406.6 | ) | (94 | )% | |||||||||||
Gross margin as a percentage of net sales | (2 | )% | 17 | % | 1 | % | 15 | % | |||||||||||||||||||||
Sales volumes(a) (in thousands of metric tonnes) | |||||||||||||||||||||||||||||
DAP/MAP | 1,311 | 1,261 | 50 | 4 | % | 3,727 | 3,888 | (161 | ) | (4 | )% | ||||||||||||||||||
Specialty(b) | 883 | 974 | (91 | ) | (9 | )% | 2,441 | 2,594 | (153 | ) | (6 | )% | |||||||||||||||||
Total finished product tonnes | 2,194 | 2,235 | (41 | ) | (2 | )% | 6,168 | 6,482 | (314 | ) | (5 | )% | |||||||||||||||||
Rock | 536 | 399 | 137 | 34 | % | 1,401 | 1,000 | 401 | 40 | % | |||||||||||||||||||
Total Phosphates Segment Tonnes(a) | 2,730 | 2,634 | 96 | 4 | % | 7,569 | 7,482 | 87 | 1 | % | |||||||||||||||||||
Realized prices ($/tonne) | |||||||||||||||||||||||||||||
Average finished product selling price (destination) | $ | 355 | $ | 454 | $ | (99 | ) | (22 | )% | $ | 396 | $ | 446 | $ | (50 | ) | (11 | )% | |||||||||||
Average rock selling price (destination)(a) | $ | 75 | $ | 68 | $ | 7 | 10 | % | $ | 73 | $ | 72 | $ | 1 | 1 | % | |||||||||||||
Average cost per unit consumed in cost of goods sold: | |||||||||||||||||||||||||||||
Ammonia (metric tonne) | $ | 306 | $ | 329 | $ | (23 | ) | (7 | )% | $ | 331 | $ | 332 | $ | (1 | ) | 0 | % | |||||||||||
Sulfur (long ton) | $ | 119 | $ | 137 | $ | (18 | ) | (13 | )% | $ | 136 | $ | 135 | $ | 1 | 1 | % | ||||||||||||
Blended rock (metric tonne) | $ | 65 | $ | 57 | $ | 8 | 14 | % | $ | 63 | $ | 57 | $ | 6 | 11 | % | |||||||||||||
Production volume (in thousands of metric tonnes) - North America | 2,111 | 2,115 | (4 | ) | 0 | % | 6,153 | 6,241 | (88 | ) | (1 | )% | |||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||||||||||||||
September 30, | 2019-2018 | September 30, | 2019-2018 | ||||||||||||||||||||||||||
(in millions, except price per tonne or unit) | 2019 | 2018 | Change | Percent | 2019 | 2018 | Change | Percent | |||||||||||||||||||||
Net sales: | |||||||||||||||||||||||||||||
North America | $ | 327.7 | $ | 345.4 | $ | (17.7 | ) | (5 | )% | $ | 859.3 | $ | 976.4 | $ | (117.1 | ) | (12 | )% | |||||||||||
International | 288.7 | 263.6 | 25.1 | 10 | % | 859.7 | 605.8 | 253.9 | 42 | % | |||||||||||||||||||
Total | 616.4 | 609.0 | 7.4 | 1 | % | 1,719.0 | 1,582.2 | 136.8 | 9 | % | |||||||||||||||||||
Cost of goods sold | 458.1 | 448.1 | 10.0 | 2 | % | 1,194.2 | 1,186.7 | 7.5 | 1 | % | |||||||||||||||||||
Gross margin | $ | 158.3 | $ | 160.9 | $ | (2.6 | ) | (2 | )% | $ | 524.8 | $ | 395.5 | $ | 129.3 | 33 | % | ||||||||||||
Gross margin as a percentage of net sales | 26 | % | 26 | % | 31 | % | 25 | % | |||||||||||||||||||||
Sales volume(a) (in thousands of metric tonnes) | |||||||||||||||||||||||||||||
MOP | 2,099 | 2,187 | (88 | ) | (4 | )% | 5,747 | 5,837 | (90 | ) | (2 | )% | |||||||||||||||||
Specialty(b) | 222 | 241 | (19 | ) | (8 | )% | 598 | 645 | (47 | ) | (7 | )% | |||||||||||||||||
Total Potash Segment Tonnes | 2,321 | 2,428 | (107 | ) | (4 | )% | 6,345 | 6,482 | (137 | ) | (2 | )% | |||||||||||||||||
Realized prices ($/tonne) | |||||||||||||||||||||||||||||
Average finished product selling price (destination) | $ | 266 | $ | 251 | $ | 15 | 6 | % | $ | 271 | $ | 244 | $ | 27 | 11 | % | |||||||||||||
Production volume (in thousands of metric tonnes) | 1,771 | 2,220 | (449 | ) | (20 | )% | 6,205 | 6,646 | (441 | ) | (7 | )% | |||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||||||||||||||
September 30, | 2019-2018 | September 30, | 2019-2018 | ||||||||||||||||||||||||||
(in millions, except price per tonne or unit) | 2019 | 2018 | Change | Percent | 2019 | 2018 | Change | Percent | |||||||||||||||||||||
Net Sales | $ | 1,388.3 | $ | 1,399.8 | $ | (11.5 | ) | (1 | )% | $ | 2,919.0 | $ | 2,777.8 | $ | 141.2 | 5 | % | ||||||||||||
Cost of goods sold | 1,256.2 | 1,247.8 | 8.4 | 1 | % | 2,699.3 | 2,513.6 | 185.7 | 7 | % | |||||||||||||||||||
Gross margin | $ | 132.1 | $ | 152.0 | $ | (19.9 | ) | (13 | )% | $ | 219.7 | $ | 264.2 | $ | (44.5 | ) | (17 | )% | |||||||||||
Gross margin as a percent of net sales | 10 | % | 11 | % | 8 | % | 10 | % | |||||||||||||||||||||
Sales volume (in thousands of metric tonnes) | |||||||||||||||||||||||||||||
Phosphate produced in Brazil | 846 | 1,214 | (368 | ) | (30 | )% | 2,021 | 2,277 | (256 | ) | (11 | )% | |||||||||||||||||
Potash produced in Brazil | 88 | 82 | 6 | 7 | % | 241 | 247 | (6 | ) | (2 | )% | ||||||||||||||||||
Purchased nutrients for distribution | 2,500 | 2,299 | 201 | 9 | % | 4,791 | 4,501 | 290 | 6 | % | |||||||||||||||||||
Total Mosaic Fertilizantes Segment Tonnes | 3,434 | 3,595 | (161 | ) | (4 | )% | 7,053 | 7,025 | 28 | — | % | ||||||||||||||||||
Realized prices ($/tonne) | |||||||||||||||||||||||||||||
Average finished product selling price (destination) | $ | 404 | $ | 389 | $ | 15 | 4 | % | $ | 414 | $ | 395 | $ | 19 | 5 | % | |||||||||||||
Purchases ('000 tonnes) | |||||||||||||||||||||||||||||
DAP/MAP from Mosaic | 201 | 97 | 104 | 107 | % | 664 | 383 | 281 | 73 | % | |||||||||||||||||||
MicroEssentials® from Mosaic | 294 | 394 | (100 | ) | (25 | )% | 852 | 968 | (116 | ) | (12 | )% | |||||||||||||||||
Potash from Mosaic/Canpotex | 868 | 841 | 27 | 3 | % | 1,878 | 2,000 | (122 | ) | (6 | )% | ||||||||||||||||||
Average cost per unit consumed in cost of goods sold: | |||||||||||||||||||||||||||||
Ammonia (metric tonne) | $ | 375 | $ | 333 | $ | 42 | 13 | % | $ | 385 | $ | 359 | $ | 26 | 7 | % | |||||||||||||
Sulfur (long ton) | $ | 178 | $ | 184 | $ | (6 | ) | (3 | )% | $ | 190 | $ | 190 | $ | — | 0 | % | ||||||||||||
Blended rock (metric tonne) | $ | 103 | $ | 93 | $ | 10 | 11 | % | $ | 104 | $ | 102 | $ | 2 | 2 | % | |||||||||||||
Production volume (in thousands of metric tonnes) | 765 | 920 | (155 | ) | (17 | )% | 2,341 | 2,729 | (388 | ) | (14 | )% | |||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||||||||||||||
September 30, | 2019-2018 | September 30, | 2019-2018 | ||||||||||||||||||||||||||
(in millions) | 2019 | 2018 | Change | Percent | 2019 | 2018 | Change | Percent | |||||||||||||||||||||
Selling, general and administrative expenses | $ | 78.2 | $ | 78.5 | $ | (0.3 | ) | 0 | % | $ | 249.8 | $ | 251.4 | $ | (1.6 | ) | (1 | )% | |||||||||||
Plant City closure (benefit) costs | (15.6 | ) | — | (15.6 | ) | NM | 353.8 | — | 353.8 | NM | |||||||||||||||||||
Other operating expense | 77.8 | 23.7 | 54.1 | NM | 113.3 | 110.5 | 2.8 | 3 | % | ||||||||||||||||||||
Interest expense | (53.1 | ) | (57.7 | ) | 4.6 | (8 | )% | (161.1 | ) | (171.9 | ) | 10.8 | (6 | )% | |||||||||||||||
Interest income | 9.9 | 16.8 | (6.9 | ) | (41 | )% | 24.9 | 36.5 | (11.6 | ) | (32 | )% | |||||||||||||||||
Interest expense, net | (43.2 | ) | (40.9 | ) | (2.3 | ) | 6 | % | (136.2 | ) | (135.4 | ) | (0.8 | ) | 1 | % | |||||||||||||
Foreign currency transaction (loss) | (53.8 | ) | (2.2 | ) | (51.6 | ) | NM | (10.4 | ) | (113.1 | ) | 102.7 | (91 | )% | |||||||||||||||
Other income (expense) | 9.7 | (7.6 | ) | 17.3 | NM | 4.9 | (15.6 | ) | 20.5 | NM | |||||||||||||||||||
Provision for income taxes | 69.2 | 90.6 | (21.4 | ) | (24 | )% | 64.1 | 44.4 | 19.7 | 44 | % | ||||||||||||||||||
Equity in net (loss) of nonconsolidated companies | (23.0 | ) | (2.3 | ) | (20.7 | ) | NM | (34.3 | ) | (3.9 | ) | (30.4 | ) | NM | |||||||||||||||
Three months ended | Effective Tax Rate | Provision for (Benefit from) Income Taxes | ||||||
September 30, 2019 | 132.6 | % | $ | 69.2 | ||||
September 30, 2018 | 26.4 | % | 90.6 | |||||
Nine months ended | Effective Tax Rate | Provision for (Benefit from) Income Taxes | ||||||
September 30, 2019 | (152.6 | )% | $ | 64.1 | ||||
September 30, 2018 | 10.9 | % | 44.4 | |||||
(in millions) | Nine months ended | |||||||||||||
September 30, | 2019-2018 | |||||||||||||
Cash Flow | 2019 | 2018 | Change | Percent | ||||||||||
Net cash provided by operating activities | $ | 817.8 | $ | 1,259.8 | $ | (442.0 | ) | (35 | )% | |||||
Net cash used in investing activities | (1,014.1 | ) | (1,660.9 | ) | 646.8 | (39 | )% | |||||||
Net cash used in financing activities | (16.3 | ) | (679.6 | ) | 663.3 | (98 | )% | |||||||
• | difficulties with realization of the benefits of the Acquisition, including the risks that the Acquired Business may not be integrated successfully, |
• | because of political and economic instability in Brazil or changes in government policy in Brazil, our operations could be disrupted, as higher costs of doing business could result, including those associated with implementation of new freight tables and new mining legislation; |
• | business and economic conditions and governmental policies affecting the agricultural industry where we or our customers operate, including price and demand volatility resulting from periodic imbalances of supply and demand; |
• | changes in farmers’ application rates for crop nutrients; |
• | changes in the operation of world phosphate or potash markets, including continuing consolidation in the crop nutrient industry, particularly if we do not participate in the consolidation; |
• | the expansion or contraction of production capacity or selling efforts by competitors or new entrants in the industries in which we operate, including the effects of actions by members of Canpotex to prove the production capacity of potash expansion projects, through proving runs or otherwise; |
• | the expected cost of MWSPC and our expected remaining investment to be made in it, the amount, terms, availability and sufficiency of funding for MWSPC from us, Saudi Arabian Mining Company and Saudi Basic Industries Corporation and existing or future external sources, the timely development and commencement of operations of production facilities in the Kingdom of Saudi Arabia, political and economic instability in the region, and in general the future success of current plans for the joint venture and any future changes in those plans; |
• | build-up of inventories in the distribution channels for our products that can adversely affect our sales volumes and selling prices; |
• | the effect of future product innovations or development of new technologies on demand for our products; |
• | seasonality in our business that results in the need to carry significant amounts of inventory and seasonal peaks in working capital requirements, and may result in excess inventory or product shortages; |
• | changes in the costs, or constraints on supplies, of raw materials or energy used in manufacturing our products, or in the costs or availability of transportation for our products; |
• | declines in our selling prices or significant increases in costs that can require us to write down our inventories to the lower of cost or market, or require us to impair goodwill or other long-lived assets, or establish a valuation allowance against deferred tax assets; |
• | the effects on our customers of holding high cost inventories of crop nutrients in periods of rapidly declining market prices for crop nutrients; |
• | the lag in realizing the benefit of falling market prices for the raw materials we use to produce our products that can occur while we consume raw materials that we purchased or committed to purchase in the past at higher prices; |
• | customer expectations about future trends in the selling prices and availability of our products and in farmer economics; |
• | disruptions to existing transportation or terminaling facilities, including those of Canpotex or any joint venture in which we participate; |
• | shortages or other unavailability of railcars, tugs, barges and ships for carrying our products and raw materials; |
• | the effects of and change in trade, including tariffs, particularly around U.S. - Chinese trade policies, monetary, environmental, tax and fiscal policies, laws and regulations; |
• | foreign exchange rates and fluctuations in those rates; |
• | tax regulations, currency exchange controls and other restrictions that may affect our ability to optimize the use of our liquidity; |
• | other risks associated with our international operations, including any potential adverse effects related to the Miski Mayo mine in the event that protests against natural resource companies in Peru were to extend to or impact the Miski Mayo mine; |
• | adverse weather conditions affecting our customer's fertilizer applications and our operations, including the impact of potential hurricanes, excessive heat, cold, snow or rainfall, or drought; |
• | difficulties or delays in receiving, challenges to, increased costs of obtaining or satisfying conditions of, or revocation or withdrawal of required governmental and regulatory approvals, including permitting activities; |
• | changes in the environmental, mining and other governmental regulation that applies to our operations, including Brazil's mining regulations, federal legislation or regulatory action expanding the types and extent of water resources regulated under federal law and the possibility of further federal or state legislation or regulatory action affecting or related to greenhouse gas emissions, including carbon taxes or other measures that may be implemented in Canada or other jurisdictions in which we operate, or of restrictions or liabilities related to elevated levels of naturally-occurring radiation that arise from disturbing the ground in the course of mining activities or possible efforts to reduce the flow of nutrients into the Gulf of Mexico, the Mississippi River basin or elsewhere; |
• | the potential costs and effects of implementation of federal or state water quality standards for the discharge of nitrogen and/or phosphorus into Florida waterways; |
• | the financial resources of our competitors, including state-owned and government-subsidized entities in other countries; |
• | the possibility of defaults by our customers on trade credit that we extend to them or on indebtedness that they incur to purchase our products and that we guarantee, particularly when we are exiting our business operations or locations that produced or sold the products to that customer; |
• | any significant reduction in customers’ liquidity or access to credit that they need to purchase our products; |
• | the effectiveness of the processes we put in place to manage our significant strategic priorities, including the expansion of our Potash business and our investment in MWSPC, and to successfully integrate and grow acquired businesses; |
• | actual costs of various items differing from management’s current estimates, including, among others, asset retirement, environmental remediation, reclamation or other environmental obligations and Canadian resource taxes and royalties, or the costs of MWSPC, its existing or future funding and our commitments in support of such funding; |
• | the costs and effects of legal and administrative proceedings and regulatory matters affecting us, including environmental, tax or administrative proceedings, complaints that our operations are adversely impacting nearby farms, businesses, other property uses or properties, settlements thereof and actions taken by courts with respect to approvals of settlements, costs related to defending and resolving global audit, appellate or other court-related activity other developments in legal proceedings and regulatory matters; |
• | the success of our efforts to attract and retain highly qualified and motivated employees; |
• | strikes, labor stoppages or slowdowns by our work force or increased costs resulting from unsuccessful labor contract negotiations, and the potential costs and effects of compliance with new regulations affecting our workforce, which increasingly focus on wages and hours, healthcare, retirement and other employee benefits; |
• | brine inflows at our Esterhazy, Saskatchewan potash mines, as well as potential inflows at our other shaft mines; |
• | accidents or other incidents involving our properties or operations, including potential fires, explosions, seismic events, sinkholes, unsuccessful tailings management, ineffective mine safety procedures, or releases of hazardous or volatile chemicals; |
• | terrorism or other malicious intentional acts and costs associated with such acts; |
• | cybersecurity risks, including attempts to gain unauthorized access to, or disable, our information technology systems, the potential misappropriation of assets or sensitive information, or our costs of addressing cybersecurity risks and attacks; |
• | other disruptions of operations at any of our key production and distribution facilities, particularly when they are operating at high operating rates; |
• | changes in antitrust and competition laws or their enforcement; |
• | actions by the holders of controlling equity interests in businesses in which we hold a noncontrolling interest; |
• | changes in our relationships with other members of Canpotex or any joint venture in which we participate or their or our exit from participation in Canpotex or any such export association or joint venture, and other changes in our commercial arrangements with unrelated third parties; |
• | the adequacy of our property, business interruption and casualty insurance policies to cover potential hazards and risks incident to our business, and our willingness and ability to maintain current levels of insurance coverage as a result of market conditions, our loss experience and other factors; |
• | difficulties in realizing benefits under our long-term natural gas based pricing ammonia supply agreement with CF Industries, Inc., including the risks that the cost savings initially anticipated from the agreement may not be fully realized over the term of the agreement or that the price of natural gas or the market price for ammonia during the agreement's term are at levels at which the agreement’s natural gas based pricing is disadvantageous to us, compared with purchases in the spot market; and |
• | other risk factors reported from time to time in our Securities and Exchange Commission reports. |
(in millions US$) | As of September 30, 2019 | As of December 31, 2018 | |||||||||||||||||||||||||||||||||
Expected Maturity Date | Fair Value | Expected Maturity Date | Fair Value | ||||||||||||||||||||||||||||||||
Years ending December 31, | Year ending December 31, | ||||||||||||||||||||||||||||||||||
2019 | 2020 | 2021 | 2022 | 2019 | 2020 | 2021 | |||||||||||||||||||||||||||||
Foreign Currency Exchange Forwards | |||||||||||||||||||||||||||||||||||
Canadian Dollar | $ | (9.2 | ) | $ | (40.7 | ) | |||||||||||||||||||||||||||||
Notional (million US$) - long Canadian dollars | $ | 219.9 | $ | 350.7 | $ | 138.2 | $ | 49.3 | $ | 651.3 | $ | 170.1 | $ | 138.2 | |||||||||||||||||||||
Weighted Average Rate - Canadian dollar to U.S. dollar | 1.3098 | 1.3047 | 1.3025 | 1.3183 | 1.2989 | 1.2877 | 1.3025 | ||||||||||||||||||||||||||||
Foreign Currency Exchange Collars | |||||||||||||||||||||||||||||||||||
Canadian Dollar | $ | (0.2 | ) | $ | 0.0 | ||||||||||||||||||||||||||||||
Notional (million US$) | $ | — | $ | — | $ | — | $ | 22.8 | $ | — | $ | — | $ | — | |||||||||||||||||||||
Weighted Average Participation Rate - Canadian dollar to U.S. dollar | — | — | — | 1.3443 | — | — | — | ||||||||||||||||||||||||||||
Weighted Average Protection Rate - Canadian dollar to U.S. dollar | — | — | — | 1.2900 | — | — | — | ||||||||||||||||||||||||||||
Indian Rupee | $ | (0.1 | ) | $ | 0.0 | ||||||||||||||||||||||||||||||
Notional (million US$) | $ | 20.0 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||
Weighted Average Participation Rate - Indian rupee to U.S. dollar | 69.7500 | — | — | — | — | — | — | ||||||||||||||||||||||||||||
Weighted Average Protection Rate - Indian rupee to U.S. dollar | 74.2950 | — | — | — | — | — | — | ||||||||||||||||||||||||||||
Foreign Currency Exchange Non-Deliverable Forwards | |||||||||||||||||||||||||||||||||||
Brazilian Real | $ | 0.5 | $ | (2.5 | ) | ||||||||||||||||||||||||||||||
Notional (million US$) - short Brazilian real | $ | 495.0 | $ | 3.7 | $ | — | $ | — | $ | 535.1 | $ | — | $ | — | |||||||||||||||||||||
Weighted Average Rate - Brazilian real to U.S. dollar | 4.0238 | 4.0804 | — | — | 3.8385 | — | — | ||||||||||||||||||||||||||||
Notional (million US$) - long Brazilian real | $ | 204.8 | $ | 216.9 | $ | — | $ | — | $ | 459.1 | $ | — | $ | — | |||||||||||||||||||||
Weighted Average Rate - Brazilian real to U.S. dollar | 4.0412 | 4.0120 | — | — | 3.8333 | — | — | ||||||||||||||||||||||||||||
Indian Rupee | $ | (1.3 | ) | $ | (5.9 | ) | |||||||||||||||||||||||||||||
Notional (million US$) - short Indian rupee | $ | 224.5 | $ | — | $ | — | $ | — | $ | 137.9 | $ | — | $ | — | |||||||||||||||||||||
Weighted Average Rate - Indian rupee to U.S. dollar | 71.4323 | — | — | — | 73.0517 | — | — | ||||||||||||||||||||||||||||
Total Fair Value | $ | (10.3 | ) | $ | (49.1 | ) | |||||||||||||||||||||||||||||
(in millions) | As of September 30, 2019 | As of December 31, 2018 | |||||||||||||||||||||||||||||||||||||
Expected Maturity Date | Expected Maturity Date | ||||||||||||||||||||||||||||||||||||||
Years ending December 31, | Years ending December 31, | ||||||||||||||||||||||||||||||||||||||
2019 | 2020 | 2021 | 2022 | Fair Value | 2019 | 2020 | 2021 | 2022 | Fair Value | ||||||||||||||||||||||||||||||
Natural Gas Swaps | $ | (5.2 | ) | $ | (17.0 | ) | |||||||||||||||||||||||||||||||||
Notional (million MMBtu) - long | 3.9 | 21.4 | 18.5 | 4.9 | 20.4 | 15.8 | 13.2 | 2.9 | |||||||||||||||||||||||||||||||
Weighted Average Rate (US$/MMBtu) | $ | 2.07 | $ | 1.95 | $ | 1.97 | $ | 1.81 | $ | 2.22 | $ | 1.92 | $ | 1.73 | $ | 1.47 | |||||||||||||||||||||||
Total Fair Value | $ | (5.2 | ) | $ | (17.0 | ) | |||||||||||||||||||||||||||||||||
(a) | Evaluation of Disclosure Controls and Procedures |
(b) | Changes in Internal Control Over Financial Reporting |
Period | Total number of shares purchased | Average price paid per share | Total number of shares purchased as part of a publicly announced program | Maximum approximate dollar value of shares that may yet be purchased under the program(a) | ||||
Common Stock | ||||||||
July 1, 2019 - July 31, 2019.................... | — | — | — | $850,067,864 | ||||
August 1, 2019 - August 31, 2019............... | — | — | — | $850,067,864 | ||||
September 1, 2019 - September 30, 2019......... | 5,825,532 | $21.40 | 5,825,532 | $725,390,351 | ||||
Total................................. | 5,825,532 | $21.40 | 5,825,532 | $725,390,351 | ||||
Exhibit Index | ||||||
Exhibit No | Description | Incorporated Herein by Reference to | Filed with Electronic Submission | |||
10.1 | X | |||||
31.1 | X | |||||
31.2 | X | |||||
32.1 | X | |||||
32.2 | X | |||||
95 | X | |||||
101.INS | Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) | X | ||||
101.SCH | Inline XBRL Taxonomy Extension Schema Document | X | ||||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | X | ||||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | X | ||||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | X | ||||
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | X | ||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | X | ||||
THE MOSAIC COMPANY | |||
by: | /S/ CLINT C. FREELAND | ||
Clint C. Freeland | |||
Senior Vice President and Chief Financial Officer | |||
(on behalf of the registrant and as principal accounting officer) | |||
(i) | Individual Limitation for Awards Denominated in Shares. No Eligible Person may be granted any Award or Awards denominated in Shares, for more than 1,000,000 Shares (subject to adjustment as provided for in Section 4(c) of the Plan), in the aggregate in any calendar year. This limitation contained in this Section 4(d)(i) does not apply to any Award or Awards subject to the limitations contained in Section 4(d)(ii) or Section 4(d)(iii). |
(ii) | Individual Limitation for Performance Awards for Performance Periods Longer than Twelve Months Denominated in Cash. The maximum amount payable pursuant to all Performance Awards for performance periods longer than twelve months denominated in cash to any Participant in the aggregate in any taxable year shall be $7,000,000 in value, whether payable in cash, Shares or other property. This limitation contained in this Section 4(d)(ii) does not apply to any Award or Awards subject to the limitations contained in Section 4(d)(i) or Section 4(d)(iii). |
(iii) | Individual Limitation for Performance Awards for Performance Periods of Twelve Months or Less Denominated in Cash. The maximum amount payable pursuant to all Performance Awards for performance periods of twelve months or less denominated in cash to any Participant in the aggregate in any taxable year shall be $7,000,000 in value, whether payable in cash, Shares or other property. This limitation contained in this Section 4(d)(iii) does not apply to any Award or Awards subject to the limitations contained in Section 4(d)(i) or Section 4(d)(ii). |
(i) | Exercise Price. The purchase price per Share purchasable under an Option shall be determined by the Committee; provided, however, that such purchase price shall not be less than 100% of the Fair Market Value of a Share on the date of grant of such Option; provided, further, that the Committee may designate a per share purchase price below Fair Market Value on the date of grant if the Option is granted in substitution for a stock option previously granted by an entity that is acquired by or merged with the Company or an Affiliate. |
(ii) | Option Term. The term of each Option shall be fixed by the Committee at the date of grant, but shall not be longer than 10 years from the date of grant. |
(iii) | Time and Method of Exercise. The Committee shall determine the time or times at which an Option may be exercised in whole or in part and the method or methods by which, and the form or forms including cash, Shares (actually or by attestation), promissory notes (provided, however, that the par value of any Shares to be issued pursuant to such exercise shall be paid in the form of cash, services rendered, personal property, real property or a combination thereof, and provided, further, that the acceptance of such promissory notes does not conflict with Section 402 of the Sarbanes-Oxley Act of 2002), other securities, other Awards or other property, or any combination thereof, having a Fair Market Value on the exercise date equal to the applicable exercise price, in which, payment of the exercise price with respect thereto may be made or deemed to have been made. |
(iv) | Net Exercises. The Committee may, in its discretion, permit an Option to be exercised by delivering to the Participant a number of Shares having an aggregate Fair Market Value (determined as of the date of exercise) equal to the excess, if positive, of the Fair Market Value of the Shares underlying the Option being exercised on the date of exercise, over the exercise price of the Option for such Shares. |
(v) | Incentive Stock Options. Notwithstanding anything in the Plan to the contrary, the following additional provisions shall apply to the grant of stock options which are intended to qualify as Incentive Stock Options: |
(A) | The Committee will not grant Incentive Stock Options in which the aggregate Fair Market Value (determined as of the time the Option is granted) of the Shares with respect to which Incentive Stock Options are exercisable for the first time by any Participant during any calendar year (under this Plan and all other plans of the Company and its Affiliates) shall exceed $100,000. |
(B) | All Incentive Stock Options must be granted within ten years from the earlier of the date on which this Plan was adopted by the Board or the date this Plan was approved by the stockholders of the Company. |
(C) | Unless sooner exercised, all Incentive Stock Options shall expire and no longer be exercisable no later than 10 years after the date of grant; provided, however, that in the case of a grant of an Incentive Stock Option to a Participant who, at the time such Option is granted, owns (within the meaning of Section 422 of the Code) stock possessing more than 10% of the total combined voting power of all classes of stock of the Company or of its Affiliates, such Incentive Stock Option shall expire and no longer be exercisable no later than five years from the date of grant. |
(D) | The purchase price per Share for an Incentive Stock Option shall be not less than 100% of the Fair Market Value of a Share on the date of grant of the Incentive Stock Option; provided, however, that, in the case of the grant of an Incentive Stock Option to a Participant who, at the time such Option is granted, owns (within the meaning of Section 422 of the Code) stock |
(E) | Any Incentive Stock Option authorized under the Plan shall contain such other provisions as the Committee shall deem advisable, but shall in all events be consistent with and contain all provisions required in order to qualify the Option as an Incentive Stock Option. |
(i) | Restrictions. Shares of Restricted Stock and Restricted Stock Units shall be subject to such restrictions as the Committee may impose (including any limitation on the right to vote a Share of Restricted Stock or the right to receive any dividend or other right or property with respect thereto), which restrictions may lapse separately or in combination at such time or times, in such installments or otherwise as the Committee may deem appropriate. |
(ii) | Issuance and Delivery of Shares. Any Restricted Stock granted under the Plan shall be issued at the time such Awards are granted and may be evidenced in such manner as the Committee may deem appropriate, including book-entry registration or issuance of a stock certificate or certificates, which certificate or certificates shall be held by the Company or held in nominee name by the stock transfer agent, brokerage service or other Person selected by the Company to provide such services for the Plan. Such certificate or certificates shall be registered in the name of the Participant and shall bear an appropriate legend referring to the restrictions applicable to such Restricted Stock. Shares representing Restricted Stock that are no longer subject to restrictions shall be delivered (including by updating the book-entry registration) to the Participant promptly after the applicable restrictions lapse or are waived. In the case of Restricted Stock Units, no Shares shall be issued at the time such Awards are granted. Upon the lapse or waiver of restrictions and the restricted period relating to Restricted Stock Units evidencing the right to receive Shares, such Shares shall be issued and delivered to the holder of the Restricted Stock Units. |
(iii) | Forfeiture. Except as otherwise determined by the Committee, upon a Participant’s termination of employment or resignation or removal as a Director (in either case, as determined under criteria established by the Committee) during the applicable restriction period, all Shares of Restricted Stock and all Restricted Stock Units held by such Participant at such time shall be forfeited and reacquired by the Company; provided, however, that the Committee may waive in whole or in part any or all remaining restrictions with respect to Shares of Restricted Stock or Restricted Stock Units (including in the event of the Participant’s death, disability or retirement). |
(i) | Consideration for Awards. Awards may be granted for no cash consideration or for any cash or other consideration as may be determined by the Committee or required by applicable law. |
(ii) | Awards May Be Granted Separately or Together. Awards may, in the discretion of the Committee, be granted either alone or in addition to, in tandem with or in substitution for any other Award or any award granted under any other plan or arrangement of the Company or any Affiliate. Awards granted in addition to or in tandem with other Awards or in addition to or in tandem with awards granted under any other plan or arrangement of the Company or any Affiliate may be granted either at the same time as or at a different time from the grant of such other Awards or awards. |
(iii) | Forms of Payment under Awards. Subject to the terms of the Plan and of any applicable Award Agreement, payments or transfers to be made by the Company or an Affiliate upon the grant, exercise or payment of an Award may be made in such form or forms as the Committee shall determine (including cash, Shares, promissory notes (provided, however, that the acceptance of such promissory notes does not conflict with Section 402 of the Sarbanes-Oxley Act of 2002), other securities, other Awards or other property or any combination thereof), and may be made in a single payment or transfer, in installments or on a deferred basis, in each case in accordance with rules and procedures established by the Committee. Such rules and procedures may include provisions for the payment or crediting of reasonable interest on installment or deferred payments or the grant or crediting of Dividend Equivalents with respect to installment or deferred payments. |
(iv) | Limits on Transfer of Awards. No Award and no right under any such Award shall be transferable by a Participant other than by will or by the laws of descent and distribution and the Company shall not be required to recognize any attempted assignment of such rights by any Participant. Notwithstanding the foregoing, the Committee may allow a Participant to (i) designate a beneficiary or beneficiaries to exercise the rights of the Participant and receive any property distributable with respect to any Award upon the death of the Participant, (ii) transfer a Non-Qualified Stock Option to any Family Member (as such term is defined in the General Instructions to Form S-8, or any successor to such Instructions or such Form, under the Securities Act) at any time that such Participant holds such Option; provided, however, that such transfer may not be for value (as such term is defined in the General Instructions to Form S-8, or any successor to such Instructions or such Form, under the Securities Act), the family member may not make any subsequent transfers other than by will or by the laws of descent and distribution, and the Company receives written notice of such transfer, or (iii) transfer an Award under other circumstances determined by the Committee. Except as otherwise determined by the Committee, each Award or right under any such Award shall be exercisable during the Participant’s lifetime only by the Participant or, if permissible under applicable law, by the Participant’s guardian or legal representative. Except as otherwise determined by the Committee, no Award or right under any such Award may be pledged, alienated, attached or otherwise encumbered, and any purported pledge, alienation, attachment or other encumbrance thereof shall be void and unenforceable against the Company or any Affiliate. No Incentive Stock Option shall be transferable by a Participant other than by will or by the laws of descent and distribution. |
(v) | Restrictions. All Shares or other securities delivered under the Plan pursuant to any Award or the exercise thereof shall be subject to such restrictions as the Committee may deem advisable under the Plan, applicable federal or state securities laws and regulatory requirements, and the Committee may cause appropriate entries to be made with respect to, or legends to be placed on the certificates for, such Shares or other securities to reflect such restrictions. The Company shall not be required to deliver any Shares or other securities covered by an Award unless and until the requirements of any federal or state securities or other laws, rules or regulations (including the rules of any securities exchange) as may be determined by the Company to be applicable are satisfied. |
(vi) | Prohibition on Option and Stock Appreciation Right Repricing. Except as provided in Section 4(c) hereof, the Committee may not, without prior approval of the Company’s stockholders, seek to effect any re-pricing of any previously granted “underwater” Option or Stock Appreciation Right by: (i) amending or modifying the terms of the Option or Stock Appreciation Right to lower the exercise price; (ii) canceling the underwater Option and granting either (A) replacement Options or Stock Appreciation Rights having a lower exercise price; or (B) Restricted Stock, Restricted Stock Units or |
(vii) | Section 409A Provisions. Notwithstanding anything in the Plan or any Award Agreement to the contrary, to the extent that any amount or benefit that constitutes “deferred compensation” to a Participant under Section 409A and applicable guidance thereunder is otherwise payable or distributable to a Participant under the Plan or any Award Agreement solely by reason of the occurrence of a change in control or due to the Participant’s disability or “separation from service” (as such term is defined under Section 409A), such amount or benefit will not be payable or distributable to the Participant by reason of such circumstance unless the Committee determines in good faith that (i) the circumstances giving rise to such change in control, disability or separation from service meet the definition of a change in ownership or effective control, disability, or separation from service, as the case may be, in Section 409A(a)(2)(A) of the Code and applicable proposed or final regulations, or (ii) the payment or distribution of such amount or benefit would be exempt from the application of Section 409A by reason of the short-term deferral exemption or otherwise. Any payment or distribution that otherwise would be made to a Participant who is a Specified Employee (as determined by the Committee in good faith) on account of separation from service may not be made before the date which is six months after the date of the Specified Employee’s separation from service (or if earlier, upon the Specified Employee’s death) unless the payment or distribution is exempt from the application of Section 409A by reason of the short-term deferral exemption or otherwise. |
(viii) | Minimum Vesting Requirement. Notwithstanding any other provision of the Plan to the contrary, no Award (other than cash-only Awards that do not entitle the holder thereof to receive or purchase Shares) shall be granted with terms providing for any right of exercise or lapse of any vesting obligations earlier than a date that is at least one year following the date of grant (or, in the case of vesting based upon performance-based objectives, exercise and vesting restrictions cannot lapse earlier than the one-year anniversary measured from the commencement of the period over which performance is evaluated); provided, that the following shall not be subject to the foregoing minimum vesting requirement: any (A) substitute Awards granted in connection with awards that are assumed, converted or substituted pursuant to a merger, acquisition or similar transaction entered into by the Company or any of its Affiliates, (B) Shares delivered in lieu of fully vested cash bonuses, (C) Awards to Non-Employee Directors that vest on earlier of the one-year anniversary of the date of grant and the next annual meeting of stockholders which is at least 50 weeks after the immediately preceding year’s annual meeting, and (D) any additional Awards the Committee may grant, up to a maximum of five percent (5%) of the available share reserve authorized for issuance under the Plan pursuant to Section 4(a) (subject to adjustment under Section 4(c)); and, provided, further, that the foregoing restriction does not apply to the Committee’s discretion to provide for accelerated exercisability or vesting of any Award, including in cases of retirement, death, disability or a change in control, in the terms of the Award Agreement or otherwise. For purposes of counting Shares against the five percent (5%) limitation, the Share counting rules under Section 4 of the Plan apply. |
(i) | amend the eligibility for, and limitations or conditions imposed upon, participation in the Plan; |
(ii) | amend any terms relating to the granting or exercise of Awards, including terms relating to the amount and payment of the exercise price, or the vesting, expiry, assignment or adjustment of Awards, or otherwise waive any conditions of or rights of the Company under any outstanding Award, prospectively or retroactively; |
(iii) | make changes that are necessary or desirable to comply with applicable laws, rules, regulations and policies of any applicable governmental entity or stock exchange (including amendments to Awards necessary or desirable to avoid any adverse tax results under Section 409A, and no action taken to comply with Section 409A shall be deemed to impair or otherwise adversely alter or impair the rights of any holder of an Award or beneficiary thereof); or |
(iv) | amend any terms relating to the administration of the Plan, including the terms of any administrative guidelines or other rules related to the Plan. |
(v) | require stockholder approval under applicable rules or regulations of the Securities and Exchange Commission, the New York Stock Exchange or any other securities exchange; |
(vi) | increase the number of Shares authorized under the Plan as specified in Section 4(a) of the Plan; |
(vii) | modify the limitations contained in Section 4(d) of the Plan; |
(ix) | permit the award of Options or Stock Appreciation Rights at a price less than 100% of the Fair Market Value of a Share on the date of grant of such Option or Stock Appreciation Right, contrary to the provisions of Section 6(a) and Section 6(b) of the Plan; or |
(x) | cause the Company to be unable to grant Incentive Stock Options under the Plan, or would cause Section 162(m) to become unavailable with respect to the Plan. |
(i) | termination of any or all outstanding Awards, whether or not vested, in exchange for, or replacement of such Award with an amount of cash and/or other rights or property, if any, with a value equal to that of the terminated or replaced award; |
(ii) | that any or all outstanding Awards be assumed by the successor or survivor corporation, or a parent or subsidiary thereof, or shall be substituted for by similar options, rights or awards covering the stock of the successor or survivor corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares and prices; or |
(iii) | that any or all outstanding Awards shall be exercisable or payable or fully vested with respect to all Shares covered thereby, notwithstanding anything to the contrary in the applicable Award Agreement. |
(i) | determine which Affiliates shall be covered by the Plan; |
(ii) | determine which Eligible Persons outside the United States are eligible to participate in the Plan; |
(iii) | establish subplans and modify exercise procedures and other terms and procedures, to the extent such actions may be necessary or advisable. Any subplans and modifications to Plan terms and procedures established under this Section 9(n) by the Committee shall be attached to this Plan document as appendices; and |
(iv) | take any action, before or after an Award is made, that it deems advisable to obtain approval or comply with any necessary local government regulatory exemptions or approvals. |
1. | I have reviewed this quarterly report on Form 10-Q of The Mosaic Company; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and | |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and | |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. | |
November 5, 2019 |
/s/ James "Joc" C. O'Rourke |
James "Joc" C. O'Rourke |
Chief Executive Officer and President |
The Mosaic Company |
1. | I have reviewed this quarterly report on Form 10-Q of The Mosaic Company; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and | |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and | |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. | |
November 5, 2019 |
/s/ Clint C. Freeland |
Clint C. Freeland |
Senior Vice President and Chief Financial Officer |
The Mosaic Company |
November 5, 2019 |
/s/ James "Joc" C. O'Rourke |
James "Joc" C. O'Rourke |
Chief Executive Officer and President |
The Mosaic Company |
November 5, 2019 |
/s/ Clint C. Freeland |
Clint C. Freeland |
Senior Vice President and Chief Financial Officer |
The Mosaic Company |
Potash Mine | Florida Phosphate Rock Mines | |||||||||||||||||||||
Three Months Ended September 30, 2019 | Carlsbad, New Mexico | Four Corners | South Fort Meade | Wingate | South Pasture | |||||||||||||||||
Section 104 citations for violations of mandatory health or safety standards that could significantly and substantially contribute to the cause and effect of a mine safety or health hazard (#) | 7 | — | 7 | 1 | — | |||||||||||||||||
Section 104(b) orders (#) | — | — | — | — | — | |||||||||||||||||
Section 104(d) citations and orders (#) | — | — | — | — | — | |||||||||||||||||
Section 110(b)(2) violations (#) | — | — | — | — | — | |||||||||||||||||
Section 107(a) orders (#) | — | — | — | — | — | |||||||||||||||||
Proposed assessments under MSHA (whole dollars) | $ | 23,983 | $ | 4,323 | $ | 5,764 | $ | 391 | $ | — | ||||||||||||
Mining-related fatalities (#) | — | — | — | — | — | |||||||||||||||||
Section 104(e) notice | No | No | No | No | No | |||||||||||||||||
Notice of the potential for a pattern of violations under Section 104(e) | No | No | No | No | No | |||||||||||||||||
Legal actions before the Federal Mine Safety and Health Review Commission (“FMSHRC”) initiated (#) | — | — | — | — | — | |||||||||||||||||
Legal actions before the FMSHRC resolved (#) | — | — | — | — | — | |||||||||||||||||
Legal actions pending before the FMSHRC, end of period: | ||||||||||||||||||||||
Contests of citations and orders referenced in Subpart B of 29 CFR Part 2700 (#) | — | — | — | — | — | |||||||||||||||||
Contests of proposed penalties referenced in Subpart C of 29 CFR Part 2700 (#) | — | — | — | — | — | |||||||||||||||||
Complaints for compensation referenced in Subpart D of 29 CFR Part 2700 (#) | — | — | — | — | — | |||||||||||||||||
Complaints of discharge, discrimination or interference referenced in Subpart E of 29 CFR Part 2700 (#) | — | — | — | — | — | |||||||||||||||||
Applications for temporary relief referenced in Subpart F of 29 CFR Part 2700 (#) | — | — | — | — | — | |||||||||||||||||
Appeals of judges’ decisions or orders referenced in Subpart H of 29 CFR Part 2700 (#) | — | — | — | — | — | |||||||||||||||||
Total pending legal actions (#) | — | — | — | — | — | |||||||||||||||||
Derivative Notional Amounts (Details) MMBTU in Millions, $ in Millions |
Sep. 30, 2019
USD ($)
MMBTU
|
Dec. 31, 2018
USD ($)
MMBTU
|
Mar. 31, 2017
USD ($)
|
Dec. 31, 2016
USD ($)
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|---|---|---|---|---|
| Foreign Exchange Contract | ||||
| Notional Disclosures [Abstract] | ||||
| Derivative, notional amount | $ 1,979.7 | $ 2,091.7 | ||
| Interest Rate Swap | ||||
| Notional Disclosures [Abstract] | ||||
| Derivative, notional amount | $ 585.0 | $ 585.0 | $ 275.0 | $ 310.0 |
| Commodity Contract (MMbtu) | ||||
| Notional Disclosures [Abstract] | ||||
| Nonmonetary derivative notional amount | MMBTU | 48.7 | 52.2 |
Goodwill (Details) $ in Millions |
9 Months Ended |
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Sep. 30, 2019
USD ($)
| |
| Goodwill [Line Items] | |
| Beginning Balance | $ 1,707.5 |
| Foreign currency translation | 24.3 |
| Ending Balance | $ 1,731.8 |
| Phosphates Segment | |
| Goodwill [Line Items] | |
| Reporting Unit, Percentage of Fair Value in Excess of Carrying Amount | 12.10% |
| Beginning Balance | $ 588.6 |
| Foreign currency translation | 0.0 |
| Ending Balance | $ 588.6 |
| Potash Segment | |
| Goodwill [Line Items] | |
| Reporting Unit, Percentage of Fair Value in Excess of Carrying Amount | 9.40% |
| Beginning Balance | $ 1,000.4 |
| Foreign currency translation | 26.7 |
| Ending Balance | 1,027.1 |
| Mosaic Fertilizantes | |
| Goodwill [Line Items] | |
| Beginning Balance | 106.4 |
| Foreign currency translation | (2.4) |
| Ending Balance | 104.0 |
| Corporate Eliminations And Other Segment | |
| Goodwill [Line Items] | |
| Beginning Balance | 12.1 |
| Foreign currency translation | 0.0 |
| Ending Balance | $ 12.1 |
Inventories |
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Sep. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Inventories | Inventories Inventories consist of the following:
______________________________ (a) Final price deferred is product that has shipped to customers, but the price has not yet been agreed upon.
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Leases |
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| Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Operating and Finance Leases [Text Block] | Leases In February 2016, the FASB issued a new standard (“ASC 842”) intended to improve financial reporting about leasing transactions. The FASB issued additional guidance subsequently to clarify aspects of the standard and provide certain relief for implementation. ASC 842 requires lessees to recognize on the balance sheet the rights and obligations created by leases with terms greater than twelve months. The primary change created by the new standard is the recognition of ROU assets and lease liabilities by lessees for those leases previously classified as operating leases. ASC 842 requires disclosures to enable users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. We adopted ASC 842 effective January 1, 2019, with an immaterial cumulative-effect adjustment to the opening balance of retained earnings as of that date. As allowed under the standard, we have not changed our accounting and reporting for lease arrangements for periods presented prior to January 1, 2019. The impacts upon adoption on previously reported amounts are shown below. Our accounting for capital leases (now referred to as finance leases) remained substantially unchanged. Adoption of the standard is not expected to significantly impact lease activity reported in our statements of earnings and cash flows. We have operating and finance leases for heavy mobile equipment, railcars, fleet vehicles, field and plant equipment, river and cross-Gulf vessels, corporate offices, land, and computer equipment. Our leases have remaining lease terms of 1 year to 29 years, some of which may include options to extend the leases for up to 10 years, and some of which may include options to terminate the leases within 1 year. As of September 30, 2019, assets recorded under finance leases, included within property, plant and equipment, were $409.8 million, and accumulated depreciation associated with finance leases was $47.2 million. As of September 30, 2019, assets recorded under operating leases were $212.6 million, included in other assets. Adoption of the standard related to leases impacted our previously reported results as follows:
Adoption of ASC 842 had no impact to cash from or used in operating, financing, or investing on our consolidated cash flows statements. The components of lease expense, included primarily within cost of goods sold and selling, general and administrative expenses, were as follows:
Supplemental cash flow information related to leases was as follows:
Other information related to leases was as follows:
Future lease payments under non-cancellable leases recorded as of September 30, 2019, were as follows:
A schedule of our minimum lease payments under non-cancelable capital and operating leases as of December 31, 2018 is as follows:
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Leases (Tables) |
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| Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Prospective Adoption of New Accounting Pronouncements | Adoption of the standard related to leases impacted our previously reported results as follows:
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| Lease, Cost | The components of lease expense, included primarily within cost of goods sold and selling, general and administrative expenses, were as follows:
Supplemental cash flow information related to leases was as follows:
Other information related to leases was as follows:
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| Schedule of Future Minimum Lease Payments for Operating and Finance Leases | Future lease payments under non-cancellable leases recorded as of September 30, 2019, were as follows:
A schedule of our minimum lease payments under non-cancelable capital and operating leases as of December 31, 2018 is as follows:
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Goodwill (Tables) |
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| Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Goodwill | The changes in the carrying amount of goodwill, by reporting unit, are as follows:
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Fair Value Measurements (Tables) |
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| Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The carrying amounts and estimated fair values of our financial instruments are as follows:
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Summary of Significant Accounting Policies (Policies) |
9 Months Ended |
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Sep. 30, 2019 | |
| Accounting Policies [Abstract] | |
| Basis of Consolidation | Statement Presentation and Basis of Consolidation The accompanying unaudited Condensed Consolidated Financial Statements of Mosaic have been prepared on the accrual basis of accounting and in accordance with the requirements of the Securities and Exchange Commission (“SEC”) for interim financial reporting. As permitted under these rules, certain footnotes and other financial information that are normally required by accounting principles generally accepted in the United States (“GAAP”) can be condensed or omitted. The Condensed Consolidated Financial Statements included in this document reflect, in the opinion of our management, all adjustments (consisting of only normal recurring adjustments) necessary for a fair presentation of the results for the interim periods presented. The following notes should be read in conjunction with the accounting policies and other disclosures in the Notes to the Consolidated Financial Statements included in our Annual Report on Form 10-K filed with the SEC for the year ended December 31, 2018 (the “10-K Report”). Sales, expenses, cash flows, assets and liabilities can and do vary during the year as a result of seasonality and other factors. Therefore, interim results are not necessarily indicative of the results to be expected for the full fiscal year. The accompanying Condensed Consolidated Financial Statements include the accounts of Mosaic, its majority owned subsidiaries, and certain variable interest entities in which Mosaic is the primary beneficiary. Certain investments in companies where we do not have control but have the ability to exercise significant influence are accounted for by the equity method.
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| Leases | Leases At inception, we determine whether an arrangement is a lease and the appropriate lease classification. Operating leases with terms greater than twelve months are included as operating lease right-of-use (“ROU”) assets within other assets, and lease liabilities within accrued liabilities and other noncurrent liabilities on our consolidated balance sheets. Finance leases with terms greater than twelve months are included as finance ROU assets within property and equipment, and finance lease liabilities within current maturities of long-term debt and long-term debt on our consolidated balance sheets. Leases with terms of less than twelve months, referred to as short-term leases, do not create an ROU asset or lease liability on the balance sheet. ROU assets represent our right to use an underlying asset for the lease term. Lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date of the lease, based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The company's incremental borrowing rate for a lease is the rate of interest it would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms. For both operating and finance leases, the initial ROU asset equals the lease liability, plus initial direct costs, less lease incentives received. Our lease agreements may include options to extend or terminate the lease, which are included in the lease term at the commencement date when it is reasonably certain that we will exercise that option. In general, we do not consider optional periods included in our lease agreements as reasonably certain of exercise at inception. We have lease agreements with lease and non-lease components, which are generally accounted for separately. For full-service railcar leases, we account for the lease and non-lease components as a single lease component. Additionally, for certain equipment leases, we apply assumptions using a portfolio approach given the generally consistent terms of the agreements. Lease payments based on usage (for example, per-mile or per-hour charges), referred to as variable lease costs, are recorded separately from the determination of the ROU asset and lease liability.
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| Accounting Estimates | Accounting Estimates Preparation of the Condensed Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of net sales and expenses during the reporting periods. The most significant estimates made by management relate to the estimates of fair value of acquired assets and liabilities, the recoverability of non-current assets including goodwill, the useful lives and net realizable values of long-lived assets, environmental and reclamation liabilities including asset retirement obligations (“ARO”), and income tax-related accounts, including the valuation allowance against deferred income tax assets. Actual results could differ from these estimates.
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| Earnings Per Share | The numerator for basic and diluted earnings per share (“EPS”) is net earnings attributable to Mosaic. The denominator for basic EPS is the weighted average number of shares outstanding during the period. The denominator for diluted EPS also includes the weighted average number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued, unless the shares are anti-dilutive.
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| Income Taxes | We recognize interest and penalties related to unrecognized tax benefits as a component of our income tax provision. |
| Goodwill | We review goodwill for impairment annually in October or at any time events or circumstances indicate that the carrying value may not be fully recoverable, which is based on our accounting policy and GAAP. |
| Marketable Securities Held in Trust | <div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:8px;text-align:justify;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;background-color:#ffffff;">The RCRA Trusts hold investments, which are restricted from our general use, in marketable debt securities classified as available-for-sale and are carried at fair value. As a result, unrealized gains and losses are included in other comprehensive income until realized, unless it is determined that the carrying value of an investment is impaired on an other-than-temporary basis. </font></div><div style="line-height:120%;padding-top:12px;text-align:justify;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We review the fair value hierarchy classification on a quarterly basis. Changes in the ability to observe valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy. We determine the fair market values of our available-for-sale securities and certain other assets based on the fair value hierarchy described below:</font></div><div style="line-height:120%;padding-top:12px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Level 1: Values based on unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities. </font></div><div style="line-height:120%;padding-top:12px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Level 2: Values based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, or model-based valuation techniques for which all significant assumptions are observable in the market. </font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Level 3: Values generated from model-based techniques that use significant assumptions not observable in the market. These unobservable assumptions reflect our own estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include use of option pricing models, discounted cash flow models and similar techniques.</font></div></div> |
| Asset Retirement Obligation | We recognize our estimated AROs in the period in which we have an existing legal obligation associated with the retirement of a tangible long-lived asset, and the amount of the liability can be reasonably estimated. The ARO is recognized at fair value when the liability is incurred with a corresponding increase in the carrying amount of the related long-lived asset. We depreciate the tangible asset over its estimated useful life. The liability is adjusted in subsequent periods through accretion expense, which represents the increase in the present value of the liability due to the passage of time. Such depreciation and accretion expenses are included in cost of goods sold for operating facilities and other operating expense for indefinitely closed facilities.
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| Accounting for derivative and hedging activities | <div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We periodically enter into derivatives to mitigate our exposure to foreign currency risks and the effects of changing commodity prices. We record all derivatives on the Condensed Consolidated Balance Sheets at fair value. The fair value of these instruments is determined by using quoted market prices, third party comparables, or internal estimates. We net our derivative asset and liability positions when we have a master netting arrangement in place. Changes in the fair value of the foreign currency and commodity derivatives are immediately recognized in earnings because we do not apply hedge accounting treatment to these instruments.</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Unrealized gains and (losses) on foreign currency exchange contracts used to hedge cash flows related to the production of our products are included in cost of goods sold in the Condensed Consolidated Statements of Earnings. Unrealized gains and (losses) on commodities contracts are also recorded in cost of goods sold in the Condensed Consolidated Statements of Earnings. Unrealized gains or (losses) on foreign currency exchange contracts used to hedge cash flows that are not related to the production of our products are included in the foreign currency transaction gain/(loss) caption in the Condensed Consolidated Statements of Earnings.</font></div></div> |
| Fair value measurements | <div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:12px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Following is a summary of the valuation techniques for assets and liabilities recorded in our Consolidated Balance Sheets at fair value on a recurring basis: </font></div><div style="line-height:120%;padding-top:8px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Foreign Currency Derivatives </font><font style="font-family:inherit;font-size:10pt;">- The foreign currency derivative instruments that we currently use are forward contracts and zero-cost collars, which typically expire within eighteen months. Most of the valuations are adjusted by a forward yield curve or interest rates. In such cases, these derivative contracts are classified within Level 2. Some valuations are based on exchange-quoted prices, which are classified as Level 1. Changes in the fair market values of these contracts are recognized in the Condensed Consolidated Financial Statements as a component of cost of goods sold in our Corporate, Eliminations and Other segment, or foreign currency transaction (gain) loss. </font></div><div style="line-height:120%;padding-top:8px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Commodity Derivatives </font><font style="font-family:inherit;font-size:10pt;">- The commodity contracts primarily relate to natural gas. The commodity derivative instruments that we currently use are forward purchase contracts, swaps, and three-way collars. The natural gas contracts settle using NYMEX futures or AECO price indexes, which represent fair value at any given time. The contracts’ maturities are for future months and settlements are scheduled to coincide with anticipated gas purchases during those future periods. Quoted market prices from NYMEX and AECO are used to determine the fair value of these instruments. These market prices are adjusted by a forward yield curve and are classified within Level 2. Changes in the fair market values of these contracts are recognized in the Condensed Consolidated Financial Statements as a component of cost of goods sold in our Corporate, Eliminations and Other segment. </font></div><div style="line-height:120%;padding-top:8px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Interest Rate Derivatives</font><font style="font-family:inherit;font-size:10pt;">-We manage interest expense through interest rate contracts to convert a portion of our fixed-rate debt into floating-rate debt. We also enter into interest rate swap agreements to hedge our exposure to changes in future interest rates related to anticipated debt issuances. Valuations are based on external pricing sources and are classified as Level 2. Changes in the fair market values of these contracts are recognized in the Condensed Consolidated Financial Statements as a component of interest expense. </font></div><div style="line-height:120%;padding-top:12px;text-align:justify;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">For cash and cash equivalents, receivables, net, accounts payable, structured accounts payable arrangements, and short-term debt, the carrying amount approximates fair value because of the short-term maturity of those instruments. The fair value of long-term debt, including the current portion, is estimated using quoted market prices for the publicly registered notes and debentures, classified as Level 1 and Level 2, respectively, within the fair value hierarchy, depending on the market liquidity of the debt.</font></div><div style="line-height:120%;padding-top:12px;text-align:justify;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div></div> |
| Business Segments | <div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:8px;text-align:justify;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The reportable segments are determined by management based upon factors such as products and services, production processes, technologies, market dynamics, and for which segment financial information is available for our chief operating decision maker. </font></div><div style="line-height:120%;padding-top:8px;text-align:justify;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We evaluate performance based on the operating earnings of the respective business segments, which includes certain allocations of corporate selling, general and administrative expenses. The segment results may not represent the actual results that would be expected if they were independent, stand-alone businesses. Intersegment eliminations, including profit on intersegment sales, mark-to-market gains/losses on derivatives, debt expenses, Streamsong Resort</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">®</sup></font><font style="font-family:inherit;font-size:10pt;"> results of operations and the results of the China and India distribution businesses are included within Corporate, Eliminations and Other.</font></div></div> |
Accumulated Other Comprehensive Income (Loss) |
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| Comprehensive Income (Loss) Note [Text Block] | Accumulated Other Comprehensive Income (Loss) The following table sets forth the changes in AOCI, net of tax, by component during the nine months ended September 30, 2019:
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| Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block] | The following table sets forth the changes in AOCI, net of tax, by component during the nine months ended September 30, 2019:
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| Commitments and Contingencies Disclosure [Abstract] | |
| Contingencies | Contingencies We have described below judicial and administrative proceedings to which we are subject. We have contingent environmental liabilities that arise principally from three sources: (i) facilities currently or formerly owned by our subsidiaries or their predecessors; (ii) facilities adjacent to currently or formerly owned facilities; and (iii) third-party Superfund or state equivalent sites. At facilities currently or formerly owned by our subsidiaries or their predecessors, the historical use and handling of regulated chemical substances, crop and animal nutrients and additives and by-product or process tailings have resulted in soil, surface water and/or groundwater contamination. Spills or other releases of regulated substances, subsidence from mining operations and other incidents arising out of operations, including accidents, have occurred previously at these facilities, and potentially could occur in the future, possibly requiring us to undertake or fund cleanup or result in monetary damage awards, fines, penalties, other liabilities, injunctions or other court or administrative rulings. In some instances, pursuant to consent orders or agreements with governmental agencies, we are undertaking certain remedial actions or investigations to determine whether remedial action may be required to address contamination. At other locations, we have entered into consent orders or agreements with appropriate governmental agencies to perform required remedial activities that will address identified site conditions. Taking into consideration established accruals of approximately $43.7 million and $58.6 million as of September 30, 2019 and December 31, 2018, respectively, expenditures for these known conditions currently are not expected, individually or in the aggregate, to have a material effect on our business or financial condition. However, material expenditures could be required in the future to remediate the contamination at known sites or at other current or former sites or as a result of other environmental, health and safety matters. Below is a discussion of the more significant environmental matters. New Wales Water Loss Incident. In August 2016, a sinkhole developed under one of the two cells of the active Gypstack at our New Wales facility in Polk County, Florida, resulting in process water from the stack draining into the sinkhole. The incident was reported to the FDEP and EPA. In October 2016, our subsidiary, Mosaic Fertilizer, entered into a consent order (the “Order”) with the FDEP relating to the incident. Under the Order, Mosaic Fertilizer agreed to, among other things: implement a remediation plan to close the sinkhole; perform additional monitoring of the groundwater quality and act to assess and remediate in the event monitored off-site water does not comply with applicable standards as a result of the incident; evaluate the risk of potential future sinkhole formation at the New Wales facility and at Mosaic Fertilizer’s active Gypstack operations at the Bartow, Riverview and Plant City facilities with recommendations to address any identified issues; and provide financial assurance of no less than $40.0 million, which we have done without the need for any expenditure of corporate funds through satisfaction of a financial strength test and Mosaic parent guarantee. The Order did not require payment of civil penalties relating to the incident. As of September 30, 2019, the sinkhole repairs were substantially complete, with $80.2 million spent in remediation and sinkhole-related costs through this date. We estimate remaining costs will be approximately $0.6 million. Additional expenditures could be required in the future for additional remediation or other measures in connection with the sinkhole including if, for example, FDEP or EPA were to request additional measures to address risks presented by the Gypstack. These expenditures could be material. In addition, we are unable to predict at this time what, if any, impact the New Wales water loss incident will have on future Florida permitting efforts. EPA RCRA Initiative. We have certain financial assurance and other obligations under consent decrees and a separate financial assurance arrangement relating to our facilities in Florida and Louisiana. These obligations are discussed in Note 11 of our Notes to Condensed Consolidated Financial Statements. EPA EPCRA Initiative. In July 2008, DOJ sent a letter to major U.S. phosphoric acid manufacturers, including us, stating that EPA’s ongoing investigation indicates apparent violations of Section 313 of the Emergency Planning and Community Right-to-Know Act (“EPCRA”) at their phosphoric acid manufacturing facilities. Section 313 of EPCRA requires annual reports to be submitted with respect to the use or presence of certain toxic chemicals. DOJ and EPA also stated that they believe that a number of these facilities have violated Section 304 of EPCRA and Section 103 of the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”) by failing to provide required notifications relating to the release of hydrogen fluoride from the facilities. The letter did not identify any specific violations by us or assert a demand for penalties against us. We cannot predict at this time whether EPA and DOJ will initiate an enforcement action over this matter, what its scope would be, or what the range of outcomes of such a potential enforcement action might be. Florida Sulfuric Acid Plants. On April 8, 2010, EPA Region 4 submitted an administrative subpoena to us under Section 114 of the Federal Clean Air Act (the “CAA”) regarding compliance of our Florida sulfuric acid plants with the “New Source Review” requirements of the CAA. The request received by Mosaic appears to be part of a broader EPA national enforcement initiative focusing on sulfuric acid plants. On June 16, 2010, EPA issued a notice of violation to CF (the “CF NOV”) with respect to “New Source Review” compliance at the Plant City Facility's sulfuric acid plants and the allegations in the CF NOV were not resolved before our 2014 acquisition of the Plant City Facility. CF has agreed to indemnify us with respect to any penalty EPA may assess as a result of the allegations in the CF NOV. We have been engaged in settlement discussions with U.S. EPA and the Department of Justice, originating with the allegations of violations of Clean Air Act Prevention of Significant Deterioration (“PSD”) permitting requirements at the Plant City sulfuric acid plants and encompassing injunctive relief regarding sulfur dioxide emissions across Mosaic’s Florida sulfuric acid plant fleet. With the closure of Plant City fertilizer operations, there is no longer a need to reach resolution with the government on injunctive relief (i.e., reduction of sulfur dioxide emissions) at that facility. Furthermore, the DOJ has determined that there is no basis for proceeding with a settlement, as EPA and the DOJ have not currently alleged any violations of the Clean Air Act PSD permitting requirements at any other of Mosaic’s Florida sulfuric acid plants. We cannot predict at this time whether EPA and DOJ will initiate an enforcement action in the future with respect to “New Source Review” compliance at our Florida sulfuric acid plants or what its scope would be, or what the range of outcomes might be with respect to such a potential enforcement action. Uncle Sam Gypstack. In January 2019, we observed lateral movement of the north slope of our active phosphogypsum stack at the Uncle Sam facility in Louisiana. The observation was reported to the Louisiana Department of Environmental Quality and the U.S. EPA. We continue to provide updates to the agencies on the movement, which has slowed following actions we have taken, which include reducing process water volume stored atop the stack to reduce the active load causing the movement; constructing a stability berm at the base of the slope to increase resistance; and removing gypsum from the north side to the south stack. These steps have improved slope stability and reduced slope movement. There has been no loss of containment resulting from the movement observed, and none is expected. Although continued lateral movement on the north slope could have a material effect on our future operations at that facility, we cannot predict the prospective impact on our results of operations at this time. Other Environmental Matters. Superfund and equivalent state statutes impose liability without regard to fault or to the legality of a party’s conduct on certain categories of persons who are considered to have contributed to the release of "hazardous substances" into the environment. Under Superfund, or its various state analogues, one party may, under certain circumstances, be required to bear more than its proportionate share of cleanup costs at a site where it has liability if payments cannot be obtained from other responsible parties. Currently, certain of our subsidiaries are involved or concluding involvement at several Superfund or equivalent state sites. Our remedial liability from these sites, alone or in the aggregate, currently is not expected to have a material effect on our business or financial condition. As more information is obtained regarding these sites and the potentially responsible parties involved, this expectation could change. We believe that, pursuant to several indemnification agreements, our subsidiaries are entitled to at least partial, and in many instances complete, indemnification for the costs that may be expended by us or our subsidiaries to remedy environmental issues at certain facilities. These agreements address issues that resulted from activities occurring prior to our acquisition of facilities or businesses from parties including, but not limited to, ARCO (BP); Beatrice Fund for Environmental Liabilities; Conoco; Conserv; Estech, Inc.; Kaiser Aluminum & Chemical Corporation; Kerr-McGee Inc.; PPG Industries, Inc.; The Williams Companies; CF; and certain other private parties. Our subsidiaries have already received and anticipate receiving amounts pursuant to the indemnification agreements for certain of their expenses incurred to date as well as future anticipated expenditures. We record potential indemnifications as an offset to the established accruals when they are realizable or realized. The failure of an indemnitor to fulfill its obligations could result in future costs that could be material. Louisiana Parishes Coastal Zone Cases Several Louisiana parishes and the City of New Orleans have filed lawsuits against hundreds of oil and gas companies seeking regulatory, restoration and compensatory damages in connection with historical oil, gas and sulfur mining and transportation operations in the coastal zone of Louisiana. Mosaic is the corporate successor to certain companies which performed these types of operations in the coastal zone of Louisiana. Mosaic has been named in two of the lawsuits filed to date. In addition, in several other cases, historical oil, gas and sulfur operations which may have been related to Mosaic’s corporate predecessors have been identified in the complaints. Based upon information known to date, Mosaic has contractual indemnification rights against third parties for any loss or liability arising out of these claims pursuant to indemnification agreements entered into by Mosaic’s corporate predecessor(s) with third parties. There may also be insurance contracts which may respond to some or all of the claims. However, the financial ability of the third party indemnitors, the extent of potential insurance coverage and the extent of potential liability from these claims is currently unknown. In September 2019, legal counsel for several of the parishes announced that an agreement had been reached to settle the claims against Mosaic and its corporate predecessors, subject to approval by the participating parishes and the State of Louisiana. In connection with that settlement agreement, the proposed settlement payment obligations would be paid by third party indemnitors. Phosphate Mine Permitting in Florida Denial of the permits sought at any of our mines, issuance of the permits with cost-prohibitive conditions, substantial delays in issuing the permits, legal actions that prevent us from relying on permits or revocation of permits may create challenges for us to mine the phosphate rock required to operate our Florida and Louisiana phosphate plants at desired levels or increase our costs in the future. The South Pasture Extension. In November 2016, the Army Corps of Engineers (the “Corps”) issued a federal wetlands permit under the Clean Water Act for mining an extension of our South Pasture phosphate rock mine in central Florida. On December 20, 2016, the Center for Biological Diversity, ManaSota-88, People for Protecting Peace River and Suncoast Waterkeeper issued a 60-day notice of intent to sue the Corps and the U.S. Fish and Wildlife Service (the “Service”) under the federal Endangered Species Act regarding actions taken by the Corps and the Service in connection with the issuance of the permit. On March 15, 2017, the same group filed a complaint against the Corps, the Service and the U.S. Department of the Interior in the U.S. District Court for the Middle District of Florida, Tampa Division. The complaint alleges that various actions taken by the Corps and the Service in connection with the issuance of the permit, including in connection with the Service's biological opinion and the Corps' reliance on that biological opinion, violated substantive and procedural requirements of the federal Clean Water Act (“CWA”), the National Environmental Policy Act (“NEPA”) and the Endangered Species Act (the “ESA”), and were arbitrary, capricious, an abuse of discretion, and otherwise not in accordance with law, in violation of the Administrative Procedure Act (the “APA”). As to the Corps, plaintiffs allege in their complaint, among other things, that the Corps failed to conduct an adequate analysis under the CWA of alternatives, failed to fully consider the effects of the South Pasture extension mine, failed to take adequate steps to minimize potential adverse impacts and violated the ESA by relying on the Service's biological opinion to determine that its permitting decision is not likely to adversely affect certain endangered or rare species. As to the Service, plaintiffs allege in their complaint, among other things, that the Service's biological opinion fails to meet statutory requirements, that the Service failed to properly consider impacts and adequately assess the cumulative effects on certain species, and that the Service violated the ESA in finding that the South Pasture extension mine is not likely to adversely affect certain endangered or rare species. The plaintiffs are seeking relief including (i) declarations that the Corps' decision to issue the permit violated the CWA, NEPA, the ESA and the APA and that its NEPA review violated the law; (ii) declarations that the Service's biological opinion violated applicable law and that the Corps' reliance on the biological opinion violated the ESA; (iii) orders that the Corps rescind the permit, that the Service withdraw its biological opinion and related analyses and prepare a biological opinion that complies with the ESA; and (iv) that the Corps be preliminarily and permanently enjoined from authorizing any further action under the permit until it complies fully with the requirements of the CWA, NEPA, the ESA and the APA. On March 31, 2017, Mosaic's motion for intervention was granted with no restrictions. Plaintiffs filed an amended complaint on June 2, 2017, without any new substantive allegations, and on June 28, 2017, Mosaic (as intervenor) and separately, the defendants, filed answers to the amended complaint. On June 30, 2017, the plaintiffs filed a motion for summary judgment, arguing that the permit should not have been issued. On July 15, 2017, Mosaic filed a response in opposition to the plaintiffs' motion, and on July 28, 2017, Mosaic filed its own motion for summary judgment. On December 14, 2017, the Tampa District Court granted Mosaic’s motion for summary judgment in favor of Mosaic and the government defendants, and denied the plaintiffs’ motion to supplement the administrative record. On February 12, 2018, the plaintiffs filed an appeal with the U.S. Court of Appeals for the Eleventh Circuit of the Tampa District Court decision. A mandatory mediation occurred on March 19, 2018, but no settlement was reached. Oral argument was held before the Eleventh Circuit Court of Appeals on May 22, 2019. The Court has not yet issued its decision. We believe the plaintiffs' claims in this case are without merit and we intend to vigorously defend the Corps' issuance of the South Pasture extension permit and the Service's biological opinion. However, if the plaintiffs were to prevail in this case, we would be prohibited from continuing to mine the South Pasture extension, and obtaining new or modified permits could significantly delay our resumption of mining and could result in more onerous mining conditions. This could have a material effect on our future results of operations, reduce future cash flows from operations, and in the longer term, conceivably adversely affect our liquidity and capital resources. Brazil Legal Contingencies Our Brazilian subsidiaries are engaged in a number of judicial and administrative proceedings regarding labor, environmental, mining and civil claims that allege aggregate damages and/or fines of approximately $1.1 billion. We estimate that our probable aggregate loss with respect to these claims is approximately $58.1 million, which amount is included in our accrued liabilities in our Condensed Consolidated Balance Sheet at September 30, 2019. Approximately $738.5 million of the maximum potential loss relates to labor claims, such as in-house and third party employees’ judicial proceedings alleging the right to receive overtime pay, additional payment due to work in hazardous conditions, risk premium, profit sharing, additional payment due to night work, salary parity and wage differences. We estimate that our probable aggregate loss regarding these claims is approximately $40.0 million, which is included in accrued liabilities in our Condensed Consolidated Balance Sheet at September 30, 2019. Based on Brazil legislation and the current status of similar labor cases involving unrelated companies, we believe we have recorded adequate loss contingency reserves sufficient to cover our estimate of probable losses. If the status of similar cases involving unrelated companies were to adversely change in the future, our maximum potential exposure could increase and additional accruals could be required. Approximately $2.6 million of the above mentioned $40.0 million reserves relates to a purported class action filed by one of the unions claiming additional payment for occupational hazard due to the alleged exposure of workers at the Company’s potash mine at Rosário do Catete, Sergipe, to explosive gases that could be found during the mining process. The matter currently is before the Brazilian Labor Supreme Court. The environmental judicial and administrative proceedings claims allege aggregate damages and/or fines of approximately $140.4 million. We estimate that our probable aggregate loss regarding these claims is approximately $5.4 million, which has been accrued at September 30, 2019. The majority of the reserves involves a claim filed in 2012 by the State Public Prosecutor Office, alleging that the Company delayed construction of an effluent treatment plant, thereby subjecting it to a fine under the commitment agreement. The mining judicial and administrative proceedings claims allege aggregate damages and/or fines of approximately $16.1 million. We estimate that our probable aggregate loss regarding these claims is approximately $9.2 million, which has been accrued at September 30, 2019. The majority of the reserves involves an arbitration proceeding initiated by EMS/GEOFOCUS ("EMS") in which Mosaic was ordered to indemnify EMS for the costs of exploring certain mining rights on behalf of Mosaic. Our Brazilian subsidiaries also have certain other civil contingent liabilities with respect to judicial, administrative and arbitration proceedings and claims related to contract disputes, pension plan matters, real estate disputes and other civil matters arising in the ordinary course of business. These claims allege aggregate damages in excess of $173.0 million. We estimate that the probable aggregate loss with respect to these matters is approximately $3.4 million. Uberaba Judicial Settlement In 2008, the Federal Public Prosecutor filed a public civil action requesting the Company to adopt several measures to mitigate soil and water contamination related to the Gypstack at our Uberaba facility, including compensation for the alleged social and environmental damages. In 2014, our predecessor subsidiary in Brazil entered into a judicial settlement with the Federal Public Prosecutor, the State of Minas Gerais public prosecutor and the federal environmental agency. Under this agreement, we agreed to implement remediation measures such as: constructing a liner under the Gypstack water ponds and lagoons, and monitoring the groundwater and soil quality. We also agreed to create a private reserve of natural heritage and to pay compensation in the amount of approximately $0.3 million, which was paid in July 2018. We are currently acting in compliance with our obligations under the judicial settlement and expect them to be completed by December 31, 2023. Uberaba EHS Class Action In 2013, the State of Minas Gerais public prosecutor filed a class action claiming that our predecessor company in Brazil did not comply with labor safety rules and working hour laws. This claim was based on an inspection conducted by the Labor and Employment Ministry in 2010, following which we were fined for not complying with several labor regulations. We filed our defense, claiming that we complied with these labor regulations and that the assessment carried out by the inspectors in 2010 was abusive. Following the initial hearing, the court ordered an examination to determine whether there has been any non-compliance with labor regulations. The examination is currently pending. The amount involved in the proceeding is $33.4 million. Brazil Tax Contingencies Our Brazilian subsidiaries are engaged in a number of judicial and administrative proceedings relating to various non-income tax matters. We estimate that our maximum potential liability with respect to these matters is approximately $460.0 million, of which $216.0 million is subject to an indemnification agreement entered into with Vale S.A in connection with the Acquisition. Approximately $285.0 million of the maximum potential liability relates to a Brazilian federal value-added tax, PIS and Cofins, and tax credit cases, while the majority of the remaining amount relates to various other non-income tax cases such as value-added taxes. The maximum potential liability can increase with new audits. Based on Brazil legislation and the current status of similar tax cases involving unrelated taxpayers, we believe we have recorded adequate accruals, which are immaterial, for the probable liability with respect to these Brazilian judicial and administrative proceedings. If the status of similar tax cases involving unrelated taxpayers changes in the future, additional accruals could be required. Other Claims We also have certain other contingent liabilities with respect to judicial, administrative and arbitration proceedings and claims of third parties, including tax matters, arising in the ordinary course of business. We do not believe that any of these contingent liabilities will have a material adverse impact on our business or financial condition, results of operations, and cash flows.
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| Accumulated Other Comprehensive Income (Loss) [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block] | The following table sets forth the changes in AOCI, net of tax, by component during the nine months ended September 30, 2019:
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Components of Lease Expense (Details) $ in Millions |
3 Months Ended | 9 Months Ended |
|---|---|---|
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Sep. 30, 2019
USD ($)
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Sep. 30, 2019
USD ($)
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| Leases [Abstract] | ||
| Operating Lease Cost | $ 25.9 | $ 79.5 |
| Finance Lease, Right-of-Use Asset, Amortization | 6.8 | 19.4 |
| Finance Lease, Interest Expense | 3.8 | 11.3 |
| Finance Lease Cost | 10.6 | 30.7 |
| Short-term Lease, Cost | 2.9 | 8.7 |
| Variable Lease, Cost | 5.6 | 15.6 |
| Lease, Cost | $ 45.0 | 134.5 |
| Operating Lease, Payments | 81.3 | |
| Finance Lease, Interest Payment on Liability | 8.0 | |
| Finance Lease, Principal Payments | 27.7 | |
| Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | 50.4 | |
| Right-of-Use Asset Obtained in Exchange for Finance Lease Liability | $ 71.8 | |
| Operating Lease, Weighted Average Remaining Lease Term | 4 years 9 months 18 days | 4 years 9 months 18 days |
| Finance Lease, Weighted Average Remaining Lease Term | 5 years | 5 years |
| Operating Lease, Weighted Average Discount Rate, Percent | 6.50% | 6.50% |
| Finance Lease, Weighted Average Discount Rate, Percent | 3.90% | 3.90% |
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions |
3 Months Ended | 9 Months Ended | ||
|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
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| Earnings Per Share [Abstract] | ||||
| Net (loss) earnings attributable to Mosaic | $ (44.1) | $ 247.5 | $ (146.4) | $ 357.7 |
| Basic weighted average number of shares outstanding | 385.0 | 385.5 | 385.5 | 384.5 |
| Dilutive impact of share-based awards | 0.0 | 2.0 | 0.0 | 1.6 |
| Diluted weighted average number of shares outstanding | 385.0 | 387.5 | 385.5 | 386.1 |
| Basic net (loss) earnings per share attributable to Mosaic | $ (0.11) | $ 0.64 | $ (0.38) | $ 0.93 |
| Diluted net (loss) earnings per share attributable to Mosaic | $ (0.11) | $ 0.64 | $ (0.38) | $ 0.93 |
| Shares subject to issuance upon exercise of stock options excluded from the calculation of diluted earnings per share | 2.7 | 2.0 | 2.5 | 2.6 |
Related Party Transactions (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||
|---|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
Dec. 31, 2018 |
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| Related Party Transaction [Line Items] | |||||
| Due from Affiliates | $ (105.4) | $ (105.4) | |||
| Transactions with non-consolidated companies included in net sales | 273.6 | $ 248.3 | 825.4 | $ 579.0 | |
| Net amount owed to our non-consolidated companies | $ 95.2 | ||||
| Transactions with non-consolidated companies included in cost of goods sold | 396.7 | $ 426.8 | 947.5 | 817.5 | |
| Indemnification asset | 29.9 | 29.9 | 30.7 | ||
| Affiliated Entity [Member] | |||||
| Related Party Transaction [Line Items] | |||||
| Notes Payable, Related Parties | 80.5 | $ 80.5 | 75.3 | ||
| Maximum | Affiliated Entity [Member] | |||||
| Related Party Transaction [Line Items] | |||||
| Bridge Loan | $ 54.2 | ||||
| MWSPC Joint Venture | |||||
| Related Party Transaction [Line Items] | |||||
| Percent of joint venture production Mosaic expects to market | 25.00% | ||||
| MWSPC Joint Venture | |||||
| Related Party Transaction [Line Items] | |||||
| Transactions with non-consolidated companies included in net sales | $ 2.4 | $ 7.0 | |||
Condensed Consolidated Statements of Shareholders Equity (Unaudited) (Parentheticals) - $ / shares |
3 Months Ended | 9 Months Ended | ||
|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
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| Statement of Stockholders' Equity [Abstract] | ||||
| Dividends per share | $ 0.05 | $ 0.025 | $ 0.10 | $ 0.05 |
Related Party Transactions |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| Related Party Transactions [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Related Party Transactions | Related Party Transactions We enter into transactions and agreements with certain of our non-consolidated companies and other related parties from time to time. As of September 30, 2019 and December 31, 2018, the net amount due (to) from our non-consolidated companies totaled $(105.4) million and $95.2 million, respectively. These amounts include a long-term indemnification asset of $29.9 million from Vale S.A. for reimbursement of pension plan obligations. The Condensed Consolidated Statements of Earnings included the following transactions with our non-consolidated companies:
As part of the MWSPC joint venture, we market approximately 25% of the MWSPC production, for which approximately $2.4 million and $7.0 million is included in revenue for the three and nine months ended September 30, 2019, respectively. In November 2015, we agreed to provide funds to finance the purchase and construction of two articulated tug and barge units, intended to transport anhydrous ammonia for our operations, through a bridge loan agreement with Gulf Marine Solutions, LLC (“GMS”). GMS is a wholly owned subsidiary of Gulf Sulphur Services Ltd., LLLP (“Gulf Sulphur Services”), an entity in which we and a joint venture partner, Savage Companies (“Savage”), each indirectly own a 50% equity interest and for which a subsidiary of Savage provides operating and management services. GMS provided these funds through draws on the Mosaic bridge loan, and through additional loans from Gulf Sulphur Services. We determined, beginning in 2015 that we are the primary beneficiary of GMS, a variable interest entity and, at that time, we consolidated GMS’s operations in our Phosphates segment. On October 24, 2017, a lease financing transaction was completed with respect to the completed tug and barge unit, and, following the application of proceeds from the transaction, all outstanding loans made by Gulf Sulphur Services to GMS, together with accrued interest, were repaid, and the bridge loans related to the first unit’s construction were repaid. At September 30, 2019 and December 31, 2018, $80.5 million and $75.3 million in bridge loans, respectively, which are eliminated in consolidation, were outstanding, relating to the cancelled second barge and the remaining tug. Reserves against the bridge loan of approximately $54.2 million were recorded through December 31, 2018, and no additional charges were recorded in 2018 or 2019. The construction of the remaining tug, funded by the bridge loan advances in excess of the reserves, is recorded within construction in-progress within our consolidated balance sheet. Several subsidiaries of Savage operate vessels utilized by Mosaic under time charter arrangements, including the ammonia tug and barge unit.
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Asset Retirement Obligations |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| Asset Retirement Obligation Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Asset Retirement Obligation Disclosure | Asset Retirement Obligations We recognize our estimated AROs in the period in which we have an existing legal obligation associated with the retirement of a tangible long-lived asset, and the amount of the liability can be reasonably estimated. The ARO is recognized at fair value when the liability is incurred with a corresponding increase in the carrying amount of the related long-lived asset. We depreciate the tangible asset over its estimated useful life. The liability is adjusted in subsequent periods through accretion expense, which represents the increase in the present value of the liability due to the passage of time. Such depreciation and accretion expenses are included in cost of goods sold for operating facilities and other operating expense for indefinitely closed facilities. Our legal obligations related to asset retirement require us to: (i) reclaim lands disturbed by mining as a condition to receive permits to mine phosphate ore reserves; (ii) treat low pH process water in Gypstacks to neutralize acidity; (iii) close and monitor Gypstacks at our Florida and Louisiana facilities at the end of their useful lives; (iv) remediate certain other conditional obligations; (v) remove all surface structures and equipment, plug and abandon mine shafts, contour and revegetate, as necessary, and monitor for five years after closing our Carlsbad, New Mexico facility; (vi) decommission facilities, manage tailings and execute site reclamation at our Saskatchewan potash mines at the end of their useful lives; (vii) de-commission mines in Brazil and Peru acquired as part of the Acquisition and (viii) decommission plant sites and close Gypstacks in Brazil also as part of the Acquisition. The estimated liability for these legal obligations is based on the estimated cost to satisfy the above obligations, which is discounted using a credit-adjusted risk-free rate. A reconciliation of our AROs is as follows:
North America Gypstack Closure Costs A majority of our ARO relates to Gypstack Closure Costs in Florida and Louisiana. For financial reporting purposes, we recognize our estimated Gypstack Closure Costs at their present value. This present value determined for financial reporting purposes is reflected on our Consolidated Balance Sheets in accrued liabilities and other noncurrent liabilities. As discussed below, we have arrangements to provide financial assurance for the estimated Gypstack Closure Costs associated with our facilities in Florida and Louisiana. EPA RCRA Initiative. On September 30, 2015, we and our subsidiary, Mosaic Fertilizer, LLC (“Mosaic Fertilizer”), reached agreements with the U.S. Environmental Protection Agency (“EPA”), the U.S. Department of Justice (“DOJ”), the Florida Department of Environmental Protection (“FDEP”) and the Louisiana Department of Environmental Quality on the terms of two consent decrees (collectively, the “2015 Consent Decrees”) to resolve claims relating to our management of certain waste materials onsite at our Riverview, New Wales, Mulberry, Green Bay, South Pierce and Bartow fertilizer manufacturing facilities in Florida and our Faustina and Uncle Sam facilities in Louisiana. This followed a 2003 announcement by the EPA Office of Enforcement and Compliance Assurance that it would be targeting facilities in mineral processing industries, including phosphoric acid producers, for a thorough review under the U.S. Resource Conservation and Recovery Act (“RCRA”) and related state laws. As discussed below, a separate consent decree was previously entered into with EPA and the FDEP with respect to RCRA compliance at the Plant City, Florida phosphate concentrates facility (the “Plant City Facility”) that we acquired as part of our acquisition (the “CF Phosphate Assets Acquisition”) of the Florida phosphate assets and assumption of certain related liabilities of CF Industries, Inc. (“CF”). The remaining monetary obligations under the 2015 Consent Decrees include:
addition, we have agreed to guarantee the difference between the amounts held in each RCRA Trust (including any earnings) and the estimated closure and long-term care costs. As of December 31, 2018, the undiscounted amount of our Gypstack Closure Costs ARO associated with the facilities covered by the 2015 Consent Decrees, determined using the assumptions used for financial reporting purposes, was approximately $1.5 billion, and the present value of our Gypstack Closure Costs ARO reflected in our Consolidated Balance Sheet for those facilities was approximately $457.1 million. Plant City and Bonnie Facilities. As part of the CF Phosphate Assets Acquisition, we assumed certain AROs related to Gypstack Closure Costs at both the Plant City Facility and a closed Florida phosphate concentrates facility in Bartow, Florida (the “Bonnie Facility”) that we acquired. Associated with these assets are two related financial assurance arrangements for which we became responsible and that provided sources of funds for the estimated Gypstack Closure Costs for these facilities, pursuant to federal or state law: the government entities can draw against such amounts in the event we cannot perform such closure activities. One was initially a trust (the “Plant City Trust”) established to meet the requirements under a consent decree with the EPA and the FDEP with respect to RCRA compliance at Plant City that also satisfied Florida financial assurance requirements at that site. Beginning in September 2016, as a substitute for the financial assurance provided through the Plant City Trust, we have provided financial assurance for the Plant City Facility in the form of a surety bond (the “Plant City Bond”). The amount of the Plant City Bond is $233.7 million, which reflects our closure cost estimates as of December 31, 2018. The other was also a trust fund (the “Bonnie Facility Trust”) established to meet the requirements under Florida financial assurance regulations that apply to the Bonnie Facility. In July 2018, we received $21.0 million from the Bonnie Facility Trust by substituting for the trust fund a financial test mechanism (“Bonnie Financial Test”) supported by a corporate guarantee as allowed by state regulations. Both financial assurance funding obligations require estimates of future expenditures that could be impacted by refinements in scope, technological developments, new information, cost inflation, changes in regulations, discount rates and the timing of activities. Under our current approach to satisfying applicable requirements, additional financial assurance would be required in the future if increases in cost estimates exceed the face amount of the Plant City Bond or the amount supported by the Bonnie Financial Test. At September 30, 2019 and December 31, 2018, the aggregate amounts of AROs associated with the Plant City Facility and Bonnie Facility gypstack closure costs included in our Condensed Consolidated Balance Sheets were $215.9 million and $109.2 million, respectively. The aggregate amount represented by the Plant City Bond exceeds the aggregate amount of ARO associated with that Facility. This is because the amount of financial assurance we are required to provide represents the aggregate undiscounted estimated amount to be paid by us in the normal course of our Phosphates business over a period that may not end until three decades or more after the Gypstack has been closed, whereas the ARO included in our Condensed Consolidated Balance Sheet reflects the discounted present value of those estimated amounts.
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Plant City Closure Costs |
9 Months Ended |
|---|---|
Sep. 30, 2019 | |
| Plant City Closure Costs [Abstract] | |
| Plant City Closure Costs | Plant City Closure Costs On June 18, 2019, we announced the permanent closure of the Plant City Facility. We temporarily idled the Plant City Facility in the fourth quarter of 2017, as it was one of our higher cost phosphate facilities. For the three and nine months ended September 30, 2019, we recognized pre-tax (benefits) costs of $(15.6) million and $353.8 million, respectively, related to the permanent closure of this facility. These costs consisted of approximately $210 million related to the write-off of fixed assets, $110 million related to asset retirement obligations, including the benefit of $15.6 million recorded in the three months ended September 30, 2019 related to revisions in estimated costs, and $34 million related to inventory and other reserves.
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Condensed Consolidated Balance Sheets (Unaudited) (Parentheticals) - USD ($) $ in Millions |
Sep. 30, 2019 |
Dec. 31, 2018 |
|---|---|---|
| Statement of Financial Position [Abstract] | ||
| Accumulated depreciation | $ 7,527.0 | $ 6,934.5 |
| Common stock, par value | $ 0.01 | $ 0.01 |
| Common stock, authorized | 1,000,000,000 | 1,000,000,000 |
| Common stock, issued | 389,643,771 | 389,242,360 |
| Common stock, outstanding | 380,045,964 | 385,470,085 |
| Preferred stock, par value | $ 0.01 | $ 0.01 |
| Preferred stock, authorized | 15,000,000 | 15,000,000 |
| Preferred stock, issued | 0 | 0 |
| Preferred stock, outstanding | 0 | 0 |
Document and Entity Information - shares |
9 Months Ended | |
|---|---|---|
Sep. 30, 2019 |
Nov. 01, 2019 |
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| Cover page. | ||
| Document type | 10-Q | |
| Document quarterly report | true | |
| Document period end date | Sep. 30, 2019 | |
| Document transition report | false | |
| Entity file number | 001-32327 | |
| Entity registrant name | MOSAIC CO | |
| State of incorporation | DE | |
| Employer identification number | 20-1026454 | |
| Address line one | 101 East Kennedy Blvd | |
| Address line two | Suite 2500 | |
| City | Tampa | |
| State | FL | |
| Zip code | 33602 | |
| Area code | 800 | |
| Phone number | 918-8270 | |
| Title of each class | Common Stock, par value $0.01 per share | |
| Trading symbol | MOS | |
| Name of each exchange on which registered | NYSE | |
| Entity current reporting status | Yes | |
| Entity interactive data current | Yes | |
| Entity filer category | Large Accelerated Filer | |
| Smaller reporting company | false | |
| Emerging growth company | false | |
| Entity shell company | false | |
| Entity common stock shares outstanding | 378,762,651 | |
| Entity central index key | 0001285785 | |
| Amendment flag | false | |
| Document Fiscal Year Focus | 2019 | |
| Document Fiscal Period Focus | Q3 | |
| Current fiscal year end date | --12-31 |