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IW Business Bulletin – February 25, 2022

Mosaic Potash Mine. Photo by Greg Huszar

The Mosaic Company reports Q4 and full-year results and repurchases stock

The Mosaic Company (Mosaic) reported its Q4 and full-year results on Feb. 22. The company reported full year net income of $1.6 billion (adjusted EBITDA of $3.6 billion), and fourth quarter net income of $665 million.

“Mosaic delivered record EBITDA in 2021, and we expect strong performance to continue in 2022,” said Joc O’Rourke, Mosaic president and CEO. “As a result of successful investments like our new Esterhazy K3 potash mine, Mosaic Fertilizantes in Brazil, and our cost-structure transformation, we are generating tremendous value in the current environment. This has provided us with the opportunity to return significant capital to shareholders, while still investing efficiently in the business and strengthening the balance sheet.”

Mosaic’s potash segment reported net sales of $2.6 billion in 2021, up from $2.0 billion in 2020, noting  higher pricing offset lower volumes. The company reported it is track to complete the ramp up of K3 by the end of the first quarter of 2022, expecting an annualized run rate of 5.5 million tonnes and cash. Its Colonsay operation that restarted in 2021 is now operating at its targeted annual run rate of 1 million tonnes.

Mosaic also noted in its global outlook for 2022 that the potash market remains tight and still dealing with the impact of sanctions in Belarus.

On Feb. 24, Mosaic announced its accelerated share repurchase (“ASR”) agreement with Goldman Sachs & Co. LLC (“Goldman Sachs”) to repurchase $400 million of Mosaic’s common stock.

Mosaic will make a payment of $400 million to Goldman Sachs and will receive an initial delivery of approximately 7.1 million shares of Mosaic’s common stock on February 28, 2022, according to the agreement. This represents 80 per cent of the estimated total number of shares expected to be delivered upon completion of the ASR and is based on the Feb 24 closing price of $45.35. According to Mosaic, “the final number of shares to be repurchased will be based on the volume-weighted average price during the term of the ASR, less a discount and subject to adjustments pursuant to the terms of the ASR.”  The final settlement of the agreement is expected to be completed in the second quarter of 2022.

Protein Industries Canada announces investment

Protein Industries Canada (PIC) announced on Feb. 23 that it has invested into the second phase of Canada’s National Index on Agri-Food Performance. The investment was made with lead partners Pulse Canada and the Global Institute for Food Security (GIFS) and supported by David McInnes, Coordinator of the National Index on Agri-Food Performance.

The index “is focused on developing a set of sustainability indicators and metrics related to Canada’s agriculture and agri-food industries” to help increase Canada’s overall global competitiveness. The Index looks at on the sustainable practices in the industry and helps address where improvements can be made.

“Canada has a reputation for sustainable production and processing practices. Having a set of metrics and indicators that measures these practices on a consolidated basis across the agriculture and agri-food sector will allow us to further back up our sustainability claims, strengthening Canada’s reputation and global brand and increasing trust in our products,” PIC CEO Bill Greuel said. “The ability to measure our sustainability efforts will help increase our competitiveness in the global market—particularly as we work to become a global leader in the production of plant-based ingredients and foods. Sustainability is an important distinguisher in this market, and this project will help further establish Canada as a leader in the area.”

PIC and partners have committed $659,000 to this phase of the project, with Protein Industries Canada committing $626,000 and project partners contributing the remainder and providing in-kind support.

Royal Bank of Canada and CIBC report Q1 results

Royal Bank of Canada (RBC) reported its Q1 results on Feb. 24, announcing net income of $4.1 billion for the quarter ended January 31, 2022. Income is up $248 million (six percent) from the prior year.

Net income was up $203 million from last quarter due to with higher results in Wealth Management, Capital Markets, and Investor & Treasury Services which were partially offset by lower results in Insurance and Personal & Commercial Banking.

A day later, CIBC reported its Q1 earnings on Feb. 25, with net income of $1.86 billion for the quarter ended January 31, 2022.  CIBC’s income was up by $244 million from the same quarter a year earlier.

Its core businesses saw rises in income, with Canadian Commercial Banking and Wealth Management leading, up 31 per cent from the same quarter in 2021.

SaskPower funds electric vehicle charging stations

SaskPower announced on Feb. 25 that the Crown corporation will help fund electric vehicle (EV) fast charging stations along provincial highways. The SaskPower Electric Vehicle Infrastructure Program will assist businesses or organizations install approximately 20 EV stations on major corridors. SaskPower is investing $2 million into the program, with applications for funding accepted as of Feb. 25, 2022.

Coming soon: Information Services Corp. (ISC) Q4 results on March 15, 2022, with an investor conference call on March 16, 2022 at 11 am ET.

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