Updated version 1- Update 2- Nutrien's third-quarter profit misses expectations due to high sulfur costs, and the company will shut down its Florida plant

Supplemented with analyst comments, net profit comparison, and details on the impairment of book values at the White Springs and Trinidad plants

Khusbu Jena

Reuters, November 4 - Canadian fertilizer producer Nutrien (NTR.TO) reported third-quarter profits below Wall Street expectations on Wednesday, mainly due to soaring sulfur raw material costs in its phosphate segment and lower nitrogen fertilizer sales volumes.

Following a strategic review, Nutrien said it will optimize its core Aurora operations and plans to close its high-cost White Springs plant in Florida in the second quarter of 2027, as the mine's reserves are nearly depleted.

The company expects to record an impairment charge on the book value of the White Springs mine's $430 million in assets in the fourth quarter, and will also take an impairment charge on its idled Trinidad nitrogen fertilizer business, which has a book value of $760 million.

Seth Goldstein, senior equity analyst at Morningstar, said, "Nutrien's results reflect weak North American fertilizer demand despite higher fertilizer prices, with costs for nitrogen and phosphate fertilizers also remaining high."

"However, management is clearly committed to improving free cash flow generation by shutting down high-cost phosphate operations and investing more efficiently in capital expenditures," Goldstein added.

Due to rising sulfur prices, cost of goods sold in the phosphate segment jumped to $939 per ton, causing adjusted EBITDA to plunge 93% to $8 million. Nitrogen fertilizer sales volumes fell 16.7% to 2.35 million tons, and adjusted EBITDA declined 11% to $497 million.

Nutrien raised the lower end of its full-year potash sales volume target to between 14.3 million and 14.8 million tons, but cut its full-year retail adjusted EBITDA guidance to $1.72 billion to $1.85 billion, and reduced capital expenditures to $1.95 billion to $2.0 billion.

Net profit tumbled 39% to $288 million, while total sales edged up 1% to $6.06 billion, thanks to strong nutrient prices that offset some of the impact from lower shipments.

According to LSEG data, the Saskatoon-based company reported adjusted earnings of 61 cents per share for the quarter ended September 30, below the average analyst estimate of 80 cents per share.

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