SASKATOON - Potash Corporation of Saskatchewan Inc. (TSX:POT) is reporting $317 million of net income, or 38 cents per share, in the third quarter — missing analyst estimates as tax expenses rose and prices fell compared with a year ago.
The Saskatoon-based fertilizer company had $1.6 billion of sales during the three months ended Sept. 30, which was above estimates and up from $1.52 billion a year earlier.
But PotashCorp's profit was five cents per share below estimates and down from $356 million or 41 cents per share in the third quarter of 2013.
Analysts had expected earnings to be 43 cents per share and revenue to be $1.53 billion.
The company says the average price it received for a tonne of potash was down compared with last year and a greater proportion of sales were to lower-priced offshore markets during the most recent quarter.
However, PotashCorp says its potash sales volume was 29 per cent higher than a year earlier.
The Saskatoon-based company has narrowed its full-year earnings guidance for 2014 to between $1.75-$1.85 per share, compared to the previous range of $1.70-$1.90 per share.
It said potash and nitrogen performance during the third quarter improved over last year's third quarter, but higher tax expenses and weaker contributions from offshore equity investments weighed on results.
The average realized potash price for the quarter was $281 per tonne, down from $307 per tonne in last year's third quarter.
"We continue to see encouraging signs in each of our major potash markets with a renewal of demand translating into higher sales volumes," said PotashCorp president and CEO Jochen Tilk.
"Furthermore, we experienced another quarter of improved potash pricing trends, which strengthened our earnings. Combined with internal efforts to optimize our operations, these positive developments mark important steps toward a stronger performance for our company."