Wayne Brownlee
Executive Vice President and CFO
No company, and no sector of the economy, was untouched by the financial crisis that gripped the world in the second half of 2008. While we don’t know when this crisis of economics and confidence will end, our business is tied to the world’s need for food – and when producing food, time is of the essence. Crops must be planted, fertilized and harvested.
In this economic downturn, the market has generally not differentiated between essential and non-essential businesses, between commodities and their underlying fundamentals, or among companies within a sector. But we think this will change and the strengths of PotashCorp will again be obvious. We believe premiums for quality will reappear.
Our resources, strategy and history of doing what we say we will do set our company apart. While we have world-class assets in phosphate and nitrogen, our emphasis on Potash First is the heart of our success. With an eye to long-term demand for this vital nutrient, PotashCorp, the largest producer, is in the best position to bring on the most new capacity in the least time. Expansions are underway at all of our operations, and we are primarily funding them from our cash flow. We are in this business for the long term and are confident our expanded potash capacity will be critical to meet future demand growth.
As we put our strengths to work for our stakeholders, we look for opportunities. Again we reinvested in what we believe are the world’s best potash assets – our own – through our share repurchase program. Like our previous share repurchases, this is a long-term investment that we expect will be recognized as an excellent creator of shareholder value. We also increased some of our offshore potash investments, and we continue to explore further opportunities that may become available. We believe decades of prudent balance sheet management will enable us to take advantage of those that fit our Potash First strategy. While this is not a forecast, we believe it is possible that we could far exceed our record potash gross margin of 2008 when we complete our expansion projects.
Our goal is always to maximize long-term value for our shareholders. While the current environment is a difficult one, we have achieved five consecutive years of record earnings growth and we continue to believe that PotashCorp is well positioned for future growth.
February 20, 2009
