Phosphate Holdings, Inc. (OTC: PHOS), reported second quarter 2009 earnings of $0.1 million, or $0.01 per diluted share of common stock, compared to earnings of $35.0 million, or $4.32 per diluted share of common stock for the same period in 2008. Net losses for the six months ended June 30, 2009 were $11.5 million or $1.50 per diluted share of common stock, as compared to earnings of $42.0 million, or $5.19 per diluted share of common stock for the same period last year. The Company’s first half of 2009 results were materially impacted by inventory write-downs to net realizable value of approximately $10.4 million.
Net sales for the second quarter of 2009 were $42.7 million, a 75 percent decrease from net sales of $171.5 million for the second quarter of 2008. The average sales price per short ton of DAP during the second quarter of 2009 was $275, a 74 percent decrease from the prior-year period average sales price of $1,049. During the second quarter, the Company sold 152,477 tons of DAP, with 73 percent moving into export markets. The Company had operating income of $0.1 million for the second quarter of 2009, compared to operating income of $55.0 million for the prior-year period. Earnings before interest, taxes, depreciation and amortization and other non-cash charges (EBITDA) for the second quarter of 2009 were $3.0 million, compared to EBITDA of $57.9 million for the second quarter of 2008. In the second quarter of 2009, inventory write-downs to net realizable value totaled approximately $1.1 million.
Net sales for the six months ended June 30, 2009 were $97.0 million, a 59 percent decrease from net sales of $238.5 million for the six months ended June 30, 2008. The Company incurred an operating loss of $18.2 million for the six months ended June 30, 2009, compared to operating income of $65.9 million for the prior-year period. EBITDA for the six months ended June 30, 2009 were negative $12.8 million, compared to EBITDA of $71.9 million for the same period in 2008.
As of June 30, 2009, the Company had a cash balance of approximately $0.4 million and borrowings under our revolving credit agreement of $3.1 million. The Company continues to aggressively manage its liquidity and believes that its current operations and available credit facilities should be adequate to meet the Company’s financing needs for 2009.
On August 27, 2009, the Company and OCP S.A., entered into a new phosphate rock supply agreement, which is effective as of July 3, 2009 (the “Supply Agreement”). Under the Supply Agreement, the Company agrees to purchase from OCP, on a take-or-pay basis, the phosphate rock requirements of its Pascagoula, Mississippi, plant. The price of the phosphate rock will be determined quarterly based on a negotiated formula that is based, in part, on related market prices. The term of the Supply Agreement expires on June 30, 2012.
The Company will host a conference call on Thursday, September 10, 2009, at 3:30 p.m., CDT, to discuss the Company’s operating results for the second quarter ended June 30, 2009.
Tags: Conference, greement, Holdings, Phosphate, share, stock
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