Predicting price hikes for its main product on tighter supplies in 2008, Potash Corp. of Saskatchewan on Thursday announced record third-quarter earnings, also the second-highest quarterly earnings in its history.
PotashCorp reported a net income of $243.1 million on $1.3 billion in sales for the quarter, up from $145.2 million on $953.5 million in the year-earlier quarter (all figures US$).
The Saskatoon company, which is the world’s biggest producer of agricultural potash and phosphate animal feed ingredients by capacity, said it would have beat the record earnings it posted in its Q2 if not for the net impacts of a stronger Canadian dollar and an increase in its consolidated income tax rate.
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PotashCorp also cited the costs of record-high ocean freight rates as a drag on its bottom line.
That said, “we are now benefiting from rapidly growing economies in the developing world which increases the demand for crops used in food, animal feed, fibre and fuel,” the company wrote in a release.
“Our growth in potash this year will be largely volume-related, but 2008 should be a strong margin year,” CEO Bill Doyle said in Thursday’s release.
“With potash in tight supply, price increases seem all but certain,” he added, “and these increases will now flow through to the bottom line.”
