Q3 2019 Earnings Call

[noise] recalling the conferencing Center a conference coordinator will be with you momentarily. Thank.

The 21% increase in adjusted EBITDA compared to this point last year.

Your.

Okay, and we continue to efficiently.

In.

Bert.

And is available on.

Generate into available free cash flow.

Thank you for your patience.

Our.

Yeah on the.

Full year free cash flow through the.

Andrew.

Okay.

Progress to operating more dependent North American region.

The largest and best production and.

Mobile.

Strip network in North.

Yes, the cumulative effect.

<unk>.

This disciplined choices that we make.

But the.

Clearly evident.

That.

Performance.

We can't reduction in our fixed charges.

Page.

This will discuss in more.

And the line for the next.

Yes.

Mobile.

Great the impact of our superior cash generation.

Thank you for your patience. Please stay on the line for the.

Okay.

That global.

Nearly 10% accretion for shareholders since 2017.

Okay.

Thank you for your patience.

The global demand for nitrogen will.

Outpace net capacity additions over the next four years.

Our strong balance.

Thank you for your patience.

As a superior cash generation and shareholder returns in the years ahead.

Can you separate conference I'd number.

I'll, let me turn it over to bird, who will talk more about current market conditions and our outlook than Chris will cover our financial position before I offer some closing remarks.

Once again.

Thank you, calling at least every conference I'd number.

Let's see if team continued to perform at a high level during the third quarter positioning us well for the remainder of the year in spring 2020.

That's one of them.

For most we met customer needs in July as the spring application season in North America was drawn out due to poor weather earlier in the year.

Maybe to harvest.

And the extended spring we focused on building a good order book. This included a well received the way infill program, which launched about a month later than normal and was met with strong demand.

Demand for other products with positive as well and we essentially shift what we produced in the third quarter.

As a result, we ended the quarter its seasonally low inventory levels.

This gives us flexibility the months ahead as the fall and spring application season develop.

Looking at this spring, we continue to anticipate strong corn plantings in the United States.

The.

Furnitures ratio supports higher you as corn plantings and 20 820 is comparable to last year's ratio at this time.

We are ready for the fall application ammonia season.

The.

Again.

We.

Really it was strong corn acres and attractive nutrient price.

Right.

[laughter] Oh, he's in the lab liberal dry alcohol.

<unk>, Paul see Jim will be.

Good application window thing.

Free cash flow, though would say under 30 million [laughter].

[noise] catch two quick ones [laughter], Alan <unk> yeah.

Sure.

Rural Irwin.

And Oh, yes.

To.

Beginning a theater catch on the Alvin Shih <unk>.

<unk> <unk> <unk> hundred 37 billion.

[laughter].

Embedded king.

200.

He said after that delayed out or [laughter] cap.

Expenditures.

Read and heard just saying yeah.

5.7, newly launched keynote <unk> dollar.

Her 2021 senior just curious now since this is.

[noise] retire.

<unk>.

<unk>.

And a balanced approach yeah there today.

For two years [laughter].

Certain matters sick so he.

Prudently allocate capital.

Adam we're going to return [laughter].

[laughter].

[noise] these actions will produce.

Reduced our ROE <unk> debt.

1.8.

I believe the others.

[laughter] <unk> to <unk>.

Sure.

It's well see a live in a shape up CAD <unk> <unk> <unk> sure Nice true unit.

Yes.

[noise] [laughter] minimally.

[laughter] Caf <unk> true <unk> ATM rosenblatt.

I only had two <unk> reported record and just be leaving yeah, you lose the 80 Shipman right.

It is also capital to our town called <unk>.

Sure so.

Years.

At around 400 million hours.

Sure.

[noise] <unk> [laughter] <unk> eight.

Or even though the into our.

Free cash.

Oh.

Which is absolutely.

[laughter] here.

[noise], we all.

Hi can earn.

Fish.

We have to keep it.

Free cash flow knee in its history.

Oh, that's pretty good [laughter] <unk>.

Lots of all of them on the split it return.

Crocs no away [laughter] seven nanometer <unk> share of old <unk> Sherri persist.

[noise] well have our.

Hi, Eric outbreak.

Nutrient price [laughter] <unk>.

<unk> range.

20 Ninee team.

[laughter] Henry hub overwork concur.

[laughter] actual [laughter] costs.

Quite reasonable <unk> or.

[laughter], which are often me.

[laughter] no there.

A key here are just want to be 20.

[laughter] <unk> or even Brooklyn, Eric our path on [laughter].

Oh, the free cash flow leach on or eight will be oh, well for us.

[laughter] <unk> com <unk>.

Please proceed.

Our them alone and can you.

Oh, so awful.

<unk>.

Of course is.

That's for New York.

Sure so.

Could you. Please proceed.

He.

That's the herd of seats, so theres only oh, we have to limit yourself Lund, Sweden.

<unk>.

Good [laughter] reenter the queue and we'll.

Sure this smoke.

This time allows.

Our first or income.

Out of them so.

Uh huh.

I am saying good morning, everyone.

And [laughter].

[noise]. So when you look at the market today, Oh look good.

Mine.

For a minute to see up and industrial or already seen unfair fairly stable mark.

Operating in that 240 to 60.

Sure no longer range Admob metric.

Probably the same too poor decision to step in India.

[laughter] food P. Arab goal.

Brain.

And so anything on that happening.

Looking at going into two costs.

Paradox.

There.

Energy being coal.

But.

8%, [laughter] and and you look good D.R. and D.

Do I really teaching.

Got it.

Averaging around 710 now so.

5%.

How does it allowed but I need you to sugars and some of the higher cost producer T cell.

At around 250, Dollarss and that's true on Apple would be so that was on the made in the more kidney.

And.

And shoot.

He has done a short ton.

It's probably call it $30, a little Oh, <unk> [laughter] Mark.

We see eating to meet demand and coming.

Continued demand coming from in P. It another 10, there too.

So in other means.

Perhaps.

[laughter] demand there.

Ill.

<unk>.

Hi, I'm done there or some other minimally in or more.

Need him Bruce at home.

And then we can cure.

And then we're a little bit looking good.

Thank you learn.

[laughter] Chris.

Parker <unk> ER.

<unk>.

[noise].

Good morning.

He gets.

Magnitude if your [noise].

Hello.

Generating machine can you just for mine and it's a.

For capital allocation.

<unk>.

Hi, this is.

Sure Bob back.

Including any.

[laughter] kill for low rates I heard from Brown is a little.

[noise] slows.

Yeah.

The potential for M&A just [noise].

On the light or are there are also yeah, we're bidding.

Terry.

<unk> [laughter].

[laughter] 16.

Teen Youd still be.

[laughter] <unk> you know.

Yeah.

Cash flow.

Right.

<unk>.

And moving.

That's.

[laughter].

Uh huh.

Great Great [laughter] ER.

From a bullet.

Hey.

Power.

True.

[laughter] down.

Yeah.

So.

So once the.

Uh huh.

[noise] last year old there just isn't.

[laughter] every person.

[laughter] as our current or.

Matt This is good.

R&D.

Pretty even grow Clos <unk>.

[laughter].

Please [laughter], so [laughter] far our criteria or do you.

We're all to fully.

Uhhuh.

She right.

Thanks, Adam <unk> and <unk>.

I would say early news chart cost trends.

Yeah there.

Great.

Or let's call it already [laughter] world.

Are.

Yeah, so [laughter] over a four.

Or while at the outset, we can just.

I have more or.

[noise].

Thank you [laughter] comes from you trade.

HM.

[noise].

[noise].

Can you hear a lot.

Yes, hi, good.

Good morning be changing and evolving.

[laughter] Gosh <unk> do you go back several years to the peak.

Export sport or they were predominantly 30 538 acres the global trading.

I was just needs to get [laughter], yeah, we call the impact of that are driving the olefin prices down dual [laughter] <unk> outlook or <unk>.

A short ton.

And you know [laughter] say.

[laughter]. So when you look at the Kid some changes are taking place and I am.

I think.

For the public occasions, we think are operating in the sweet spot load Fig fever, [laughter], so that makes it very little [laughter].

Probably did E twod.

[laughter] T 3 million metric tons.

And then when you look at what actually is.

Really.

Since.

That's true all so fairly constant.

<unk>, Yeah, Gordon swing Oh I am.

So we don't see the capability.

Uhhuh significant amount of Uh huh.

And as question.

We do look at it because were primarily in North America, and Kurt It's ER and.

<unk> expenses.

So that the mark.

We're a little on the focus on what.

[laughter] 90 plus percent of or.

Saying in North America.

But you're right.

Oh Chinese.

Our.

Basically paying and 83.

Third grade restrict it now North America, [laughter] T O <unk> million or App suddenly came to the North America [laughter] not happening it won't [laughter] good morning, everyone.

For one.

[noise] just wondering if you have any thats true eliminated thought.

The deep CAD for the India.

Pat you Didnt come back a matter and [noise].

Moving part [noise].

Some of those silly.

For.

No, but and then it appears to be more Oh, yes, well.

Oh sure it's great thoughts there.

Paul.

Yeah Yeah.

Yeah.

And that all the new ball thing you.

Our in history and a whats.

Right.

Oh no in.

A long term for jet engines.

Today natural gas globally is a endings [laughter].

Uh huh.

Americans.

<unk>.

Right.

Globally.

<unk>.

A simple Dan <unk> in Europe , and some in Asia.

[laughter].

China, [laughter] and I think in he will be anat.

[laughter] figure in the short term longer term, that's not couldn't be okay with it.

Mhm and growth.

And.

On the other and when you look.

Uh huh.

[laughter] [noise] oil prices and kind of mid con promoting <unk> E.

Couple of years Oh.

Eleveneight, Indeed started to the eight or no no right [laughter] D [noise].

[noise] component.

Oh, you see coal prices.

I Love thing why have they come down.

And.

The government really manage three so much.

<unk> or no real change or Robert <unk> day.

There is driving caught up.

Alright changes to follow.

Fuels.

Fuel costs and shifting.

CRISI a this legal and.

<unk>.

Oh solution for going [laughter].

And then I think over time.

Its a.

Issue.

What.

Yeah.

Right and synergies or [noise].

For the global economy that.

And yeah.

[laughter], it's still a.

Cool.

Uh huh.

And Oh.

Oh.

No it [laughter].

HM.

Yeah.

Well there.

Yes.

[laughter] volume shift.

Oh, sorry church that are.

[laughter].

[laughter].

Sure on coal or it is.

Me.

Hello.

Stage.

Yeah.

Do you in North America.

No much keeping things or.

Nor too there are 10 more or.

Oh I [noise].

And.

And then live through yet so Bob.

Lets say either 94 million.

Pardon me acres.

Morning, there either.

Yeah.

Much more the sad to add so committed [laughter] boxes.

A man in all regions.

So for them.

Hello.

<unk>.

First as little as well [noise].

Okay.

Great.

Two.

So.

So looking in north.

I remember and.

From an me.

I don't think we secured it.

What I did.

I believe it is we act.

Q2.

Although it doesn't story.

Both.

Ill and heard groups or.

And M or.

And sorry.

And so when we're looking team today and out.

Well into Chicago.

No I mean.

Not news.

Two.

Oh yeah.

H. and today at least at ads.

You too or shouldn't be and market Kurt I shouldn't that adds.

Our logistics.

A little be didn't move product.

Really.

And our kit.

But I don't be it I mean game.

So that's really what I would say we.

The corn bean ratio was.

Back to or.

This 90 or a millionaire.

As a core.

And with.

Well.

Protein more kid.

I think that.

The next <unk> <unk> [laughter].

And then do.

It was 10 million in loans are filed on she'd goals or.

Yeah first thing.

I agree you can get in that [laughter] thing.

A is it in the theoretical.

And ER.

Regarding the clip out.

[laughter] E and practical.

And so for US no we have not seen changing the athletic <unk> eating and this is Oh word.

Your peers.

With perhaps it shouldn't bag with.

Yes, she came in around moisture portal filed to hold that.

Okay.

And so.

We like to Jeez pod <unk> changes and if we're able to work.

<unk>.

But there Oh from.

Paying.

He knew who [laughter] technology.

We see that is.

Uh huh.

King.

In.

Couldnt so.

[laughter] at Neal Hot the E <unk>.

Which I think it's.

Good for the farm are good for low cost.

North American.

Producer.

Armor.

Being able to compete globally.

We look at.

Oh, no [laughter] out it Tara.

Sure.

Profit.

<unk>.

Point.

[laughter].

For turned on.

Now that.

ER Stacey.

Hi Tech candidate pool.

Pardon.

New training.

<unk>.

<unk>.

Great.

[laughter].

We are you willing.

Okay and.

You know we are.

Looking at but it does.

Okay.

Yes.

Yeah [laughter].

Yes or no.

Okay.

[noise].

Thank you heard index crushed.

Good old <unk> <unk> <unk>.

Hi, good morning after July .

Yeah, I'm, Okay I'm married it.

Right after the Frac marotta errors.

And well on a fraud and Ron or is that could move and Medicare Ah.

Frac thick and churn.

Rocking <unk> <unk>.

[laughter] outright purchases.

Oh I'm.

And so obviously.

Uh huh.

[laughter].

Or [noise].

Okay.

So with that.

To us.

That's for.

Paul.

Hey.

Hi.

I just.

Okay.

[laughter] <unk> [noise].

Hi.

Mm Hmm.

Oh.

Yes.

I'm going to be.

[laughter], some a little American ammonia.

Do you have to be ability.

[laughter] more out of <unk> own new orders this and me here [noise].

We need do you need to move some of the Moon need just peak.

This is probably what are you.

And move now [noise].

Hmm and and all costs related to some ammonia just one and give us the [noise].

The M.

Uh huh.

The.

So pipe and close week or [noise].

[laughter] so all the.

He is the mood.

Core we're you know we're really true Oh.

Sure Okay I try.

Ted.

The.

[noise] camp.

Yes.

Uh huh.

Yeah.

[laughter].

Oh.

Yeah.

Right.

And as.

Are you a limited <unk> <unk>.

Hi.

You know which is why.

For now.

Next time.

Okay.

ER.

Oh.

Yes.

[laughter] [noise].

[noise] nearly eight.

All right.

Are you seeing is Peter.

Yeah.

Right.

Uh huh.

[laughter] Coke <unk>.

[laughter].

You're right.

Right.

The bottom that experience <unk>.

And this.

He was saying we need him out.

Uh huh.

The mute.

Yeah.

Uh huh.

Yeah.

He.

Seen.

<unk> coal.

Oh, Oh wait.

And I agree with us in [laughter] [noise].

Yeah.

Tends to be [laughter] manage.

Earlier.

Through.

Wind energy [laughter], so I'm not sure.

Sure.

Oh.

Okay.

Sure.

Oh boy.

Yeah.

Oh no.

Yeah.

Yes.

Im sorry.

Yeah.

[laughter].

[noise] meal.

I would add Steve.

Correct.

Good.

As you look at the M.O. news.

Yeah.

Oh.

[laughter].

[laughter].

Current Modi I've tried to secure Trinidad.

Plan is running it negative mark and.

And that's.

Okay.

Going through right.

And as well.

Is there room for new breed need to go [laughter] kidding ER.

The.

Roma.

Oh pricing or Hardy thinking about a incurring.

And.

Yeah I think.

For the most pardon.

The.

He predicted that plant.

Looking at.

If it mark and it's really it's too.

[laughter].

We need now [laughter].

A year.

Our.

Hi, Peter.

[laughter].

Yeah.

Uh huh.

And do you see.

Yeah.

[laughter].

Okay.

And.

So.

All right [laughter] [noise].

Hi.

Uh huh.

[laughter] store.

All of them [laughter] grid.

It is.

Yeah.

Ill.

No.

ER producers.

And.

Hey, Newell.

Little bit more path. He a you away he hadn't.

Actually I know you had Patrick good go Oh crap.

Seems like.

Hi.

Yeah absolutely.

<unk> increased.

Two.

And well, but.

Our ongoing garden, Oh, or I wouldn't be how what do you sort of Kate keen about.

You know that fill program I haven't gone garden.

Oh baby and sales.

So we're in.

[laughter] timing.

Well, we might expect that.

And for quarter bird.

As a [noise].

Parker is.

As well as.

Pulls cutovers tilt participating in the international market.

[noise] and so out of the mid low in new.

I would say today, we're looking into Q <unk> I think we're very well.

In addition.

That men and our inventory is.

It's a low.

We have low pass car.

And you a and had a good number aims to mountain in the old <unk>.

It had a that you a and the sang you shouldn't.

You.

Ah Woods.

And community you can get involved.

So you can see from Martin <unk>.

Cut our attack or something more than half a jordi that eating.

Decreased.

To this issue and then the old Jim in France and the.

You are kits.

And we believe purpose to pull out of those funds.

Ladies and what do you and.

And our.

Or just couldn't be can reach need a its day.

Oh, Hey, it April P to that.

[noise] Connie.

Okay and then just quickly are you.

Okay cool.

Page and schools like or correct.

Actually who area.

Right.

<unk> exports the other keville comparable.

[laughter].

So looking at it.

The crime.

Look you know it would be we who are fairly.

But no <unk> and our I'm, not saying that we're check <unk>.

Okay.

<unk> <unk>.

[laughter].

Little bit [laughter] cool.

Sure.

We are ready.

<unk>.

And.

Great.

Yes.

I think out will be positive outcome for us what do you have a lot of them. They said, they're a little too OCC or.

To ship COO and our high in ban.

No that's happened.

[laughter].

Neil.

Production this rewards so little these [noise].

So when you get the true question and sports were off about.

He purchased and for Act.

Sure.

Right I think.

Yeah.

Q.

Uh huh.

In our <unk>.

You should.

ER.

Yeah.

Oh.

I will be.

[noise] or.

Canada or [laughter] patients per.

Oh.

And.

Hello.

Earning.

Hi.

And here.

Yes.

For sure.

[laughter].

<unk>.

You know that Act square.

Lead is true.

Oh, yes.

[laughter] Valley.

[laughter].

Partners.

Oh.

So to the north.

Our because [laughter] and now.

I <unk> or.

[noise] fun.

<unk>.

[laughter].

ER.

[laughter] relative.

Yeah.

Recently.

And our [laughter].

[laughter] are now.

So.

From our workers.

[laughter] or in the <unk> Oh.

[laughter].

See [laughter].

Yeah [laughter] one.

[noise] on.

Our away the global Oh.

Yeah.

Please.

[laughter].

<unk>.

Okay.

[laughter] Youtube <unk> right.

Hey.

Yeah.

Or [laughter] E.

Oh.

<unk>.

Right.

Your.

<unk>.

Yes.

Okay.

[laughter].

Hello.

[laughter] true on the goods and.

To Uh huh.

[laughter] senior.

Uh huh.

[noise], ladies and gentlemen, I'm supposed to conclude.

<unk>.

Right now.

No.

Huh.

[noise].