To their goal of having credit metrics solidly in the investment gradeĬategory on a sustainable basis, similar to its key investment gradeĬompetitors. The stable outlook reflects our belief that management will stay committed That arise including current dividends and longer-term throughĪdditional distributions in amounts, and forms yet to be determined. That the current large cash balance, some $2.7 billionĪt the end of May 2009, may be used in part to fund strategic opportunities Include both cash balances and the new revolver. We expect management to maintain a sizeable liquidity buffer which would Sheet and projected cash flow to execute an announced growth strategyĪs well as continue to return value to shareholders through a regularĭividend program and will consider additional shareholder distributions We expect that Mosaic's management will utilize their strong balance Investment grade credit metrics are key factors in the upgrade. Management's ability, and willingness, to maintain appropriateĭebt levels as well as publicly indicating that it intends to maintainĪ substantial liquidity buffer such that the company maintains sustainable Strengthen its balance sheet, and continue on a path to improvingĬredit metrics to levels that strongly support the Baa2 investment grade Moody's views these payments of long-termĭebt to have completed Mosaic's plan to reduce outstanding borrowings,
Mosaic's robust cash flows generatedįrom its ongoing business enabled them to not only pay down their long-termĭebt but also add to cash balances which total $2.7 billionĪt the end of May 2009. At the end of May 2009īalance sheet debt totaled $1.4 billion down from $2.6īillion at the end of May 2006.
From May 31,Ģ006 to May 31, 2009, Mosaic reduced balance sheet debt byĪpproximately $1.2 billion. This goal were made over the last 36 months. Of maintaining an investment grade status. Since its formation Mosaic's management has indicated many times in publicįorums, including its most recent annual filing, its goal Secured facilities have been retired and the ratings will be withdrawn. Scheduled to mature in February 2010 and secured term loans. That included a secured $450 million revolving credit facility The new credit facility due July 2012 replaces a secured credit agreement Our view of Mosaic centers on the sustainability of improved margins andĭebt protection measures as well as the likely permanence of the conservativeĬapital structure, expected to be maintained, in what will Term, exceed levels that support a Baa2 investment grade rating. Of pricing we still expect pricing above historic levels such that Mosaic'sĬurrent credit metrics have, and will likely for the intermediate The fertilizer industry moves off of peak cyclical conditions in terms More historical norms in the fall of 2009 and spring of 2010. In North America, will resume buying fertilizers at levels reflecting Will result in strong cash flows to Mosaic and that farmers, particularly Over the last 2-3 quarters we believe that current price levels Would be eliminated," said Moody's analyst Bill Reed.ĭespite significant reductions in sales volumes and fertilizer prices The remaining material control weakness to be resolved, and we wouldĮxpect that the need for Mosaic to provide security on its credit facilities Look for the crop nutrient market dynamics to remain healthy, for That prior to a positive move of one notch to Baa2, we would also "We previously indicated, in our July 2008 press release,
Unsecured three year $500 million revolving credit facility withĪ syndicate of banks provides Mosaic with a typical investment grade capital Management's recent announcement that it has entered into a new Strong pricing conditions in Mosaic's fertilizer markets. Public goal of maintaining a very strong investment grade credit profileĪlong with the enhanced strength of Mosaic's cash flow caused by historically The decision to raise the rating reflects severalįactors, including management's ability to realize its often stated New York, Aug- Moody's upgraded The Mosaic Company's (Mosaic) senior unsecured rating Approximately $1.2 billion of debt securities effected
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