Segment Disclosures

9 Months Ended

Sep. 30, 2022

Segment Reporting [Abstract]

Segment Disclosures

Our reportable segments consist of Ammonia, Granular Urea, UAN, AN and Other. These segments are differentiated by products. Our management uses gross margin to evaluate segment performance and allocate resources. Total other operating costs and expenses (consisting primarily of selling, general and administrative expenses and other operating—net) and non-operating expenses (consisting primarily of interest and income taxes) are centrally managed and are not included in the measurement of segment profitability reviewed by management.

Our assets, with the exception of goodwill, are not monitored by or reported to our chief operating decision maker by segment; therefore, we do not present total assets by segment. Goodwill by segment is presented in Note 7—Goodwill and Other Intangible Assets. Segment data for sales, cost of sales and gross margin for the three and nine months ended September 30, 2022 and 2021 are presented in the table below.

	Ammonia(1)		Granular Urea(2)		UAN(2)		AN(2)		Other(2)		Consolidated
	(in millions)
Three months ended September 30, 2022
Net sales	$	531	$	689	$	736	$	180	$	185	$	2,321
Cost of sales	353		394		414		136		108		1,405
Gross margin	$	178	$	295	$	322	$	44	$	77	916
Total other operating costs and expenses(3)											186
Equity in earnings of operating affiliate											20
Operating earnings											$	750
Three months ended September 30, 2021
Net sales	$	344	$	386	$	390	$	118	$	124	$	1,362
Cost of sales	262		200		233		122		105		922
Gross margin	$	82	$	186	$	157	$	(4)	$	19	440
Total other operating costs and expenses(3)											552
Equity in earnings of operating affiliate											15
Operating loss											$	(97)
Nine months ended September 30, 2022
Net sales	$	2,286	$	2,287	$	2,727	$	656	$	622	$	8,578
Cost of sales	1,075		1,024		1,102		458		314		3,973
Gross margin	$	1,211	$	1,263	$	1,625	$	198	$	308	4,605
Total other operating costs and expenses(3)											493
Equity in earnings of operating affiliate											74
Operating earnings											$	4,186
Nine months ended September 30, 2021
Net sales	$	1,009	$	1,218	$	1,056	$	359	$	356	$	3,998
Cost of sales	675		705		759		337		290		2,766
Gross margin	$	334	$	513	$	297	$	22	$	66	1,232
Total other operating costs and expense(3)											669
Equity in earnings of operating affiliate											37
Operating earnings											$	600

_______________________________________________________________________________

(1)Cost of sales and gross margin for the Ammonia segment for the nine months ended September 30, 2021 include a $112 million gain on the net settlement of certain natural gas contracts with our suppliers. See Note 14—Derivative Financial Instruments for additional information.

(2)The cost of the products that are upgraded into other products is transferred at cost into the upgraded product results.

(3)Total other operating costs and expenses for the three and nine months ended September 30, 2022 include $95 million and $257 million, respectively, of asset impairment and restructuring charges related to our U.K. operations. Total other operating costs and expenses for the three and nine months ended September 30, 2021 include $495 million of asset impairment charges related to our U.K. operations. See Note 5—United Kingdom Operations Restructuring and Impairment Charges for additional information.