Agrium Q2 profit drops 16 per cent to $625 million as expenses rise

CALGARY – Calgary-based Agrium Inc. (TSX:AGU) had US$625 million of net earnings from its continuing fertilizer and retail operations in the second quarter, equivalent to $4.34 per diluted share.

That’s down from US$744 million or $5 per share a year earlier but near the top end of the company’s estimate of between $3.85 and $4.35 per share and ahead of analyst estimates of $4.07 per share of profit.

Including discontinued operations that posted a loss of $9 million or six cents per share, Agrium earned $616 million or $4.28 per share.

The company announced in December that it would divest AAT Direct Solutions and Turf and Ornamental, which were categorized as discontinued operations. On July 2, at the beginning of the third quarter, Agrium completed the sale of the Turf and Ornamental business for $94 million.

Agrium’s expenses grew 11 per cent to $704 million for the three months ended June 30, from $635 million in the second quarter of 2013 — primarily due to the inclusion of results from retail centres acquired from Viterra in Western Canada.

Agrium said its overall sales were up $430 million or six per cent to $7.34 billion, with retail accounting for a record $6.4 billion. It attributed the increase to a comination of Viterra agri-retail operations, an improvement in its international operations and earnings growth at its legacy North American business.