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CF Industries Holdings CEO Steve Wilson on the company’s growth benefiting from a strong agriculture sector.
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Like Jeff thank you very much.
Well you're looking for a way to invest in the agricultural market but you don't have a summit for Volvo corn futures.
Consider a second derivative play CF industries.
Perfect example of those this is north America's largest maker.
A nitrogen fertilizer the coming off a record year 2012 earnings in first sales of stock up 11% over the past year.
Steve Wilson CF industries holdings.
CEO -- me now.
From Chicago and a Fox Business exclusivity in -- year -- -- here and a strong note -- earnings the numbers show that in.
-- was the top line here on the revenue side that they -- -- -- head scratching out there what can you tell us.
Well we actually have roughly flat revenue year over year we -- six billion in sales last year.
In 20116.
Point one billion in 2012.
We have very strong margins and our business our earnings before interest taxes and depreciation compared to net sales.
Over 50%.
-- cash conversion is very strong and we had similar performance in the fourth quarter.
And -- didn't finish up the year strong as I mentioned -- got to look at the 2013 the crystal ball I think is tougher for you.
That other companies because the weather plays a factor obviously for you but it really is that second half of 2013.
What do you think it's gonna happen I know that you weren't.
Very forthcoming about what you're expecting there again because of the weather but what is the -- show you what is your AccuWeather forecast tell you about the second half of 2013.
Well the fundamentals in the -- space remain very strong.
Both globally and in the US.
We have very low stocks to use ratios in the grains particularly from corn.
Which means -- -- the world needs -- and that's why corn prices are as high as they are.
Those fundamentals are likely to be sustainable.
Regardless of the size of crap that we have in 2013.
The first half of course that has a lot to say about what the second half will be the amount of inventory that producers.
In our in our business have.
Coming out of the first half -- will be it will.
Will lead to the degree of pricing strength going into the second half.
But we feel -- very very.
Positive about the long term fundamentals and our business.
OK and again in the the weather forecast and -- -- it's -- to get that straight obviously the first half we'll give us of a sense from your company.
Also you know it nice and production natural gas plays a big piece.
What you have to do the cost that you have -- core.
I would think that but those -- lower natural gas prices are actually helpful for the company next get Nat gas how close you watching that contract -- can you forecast a little bit helps and affect you for the -- of the yuan.
Well we -- natural gas -- very closely today natural gas costs.
Are about 70% of the cash cost of making ammonia which was our first stage.
Nitrogen fertilizer.
Product.
Our our.
Our use of natural gas were probably the biggest or one of the biggest consumers of natural gas.
Other than other than for conversion into energy.
We watch it very closely at -- and we are very happy but what American shale gas producers have done.
To bring new supply into the marketplace.
Today we have -- we are one of the lowest cost producers.
Of nitrogen fertilizers in the world consequently.
We have made a -- a decision to invest three point eight billion dollars in capacity expansions.
One -- which is in Louisiana wanna which is an Iowa.
We're on the way to putting those plants in place that's to capitalize on the on the cost advantage that we have by being in North America.
Interesting I'm my -- bullish on the second -- -- 2013 considering your expansion activity.
We'll -- Wilson thank you very much CF industries holdings chairman and CEO thanks for being here appreciate at.
Thank you -- --
