The Mosaic Company — Third Quarter 2026 Earnings Summary

Financial Performance:

• Consolidated net sales were $3.1 billion, down from $3.5 billion in the same quarter of 2025.
• The company reported a net loss of $72 million ($0.23 per diluted share), compared to net income of $411 million ($1.29 per diluted share) in the prior year period.
• Operating loss was $97 million, compared to operating earnings of $340 million in the prior year.
• Adjusted EBITDA was $324 million, down from $806 million in the prior year quarter.
• Adjusted loss per share was $0.19.
• Cash flow from operations totaled $284 million, an increase from $229 million in the prior year period.
• Free cash flow was breakeven ($2 million), compared to a loss of $135 million in the prior year.
• Selling, general, and administrative expenses were $124 million, compared to $126 million in the prior year.
• The effective tax rate was 36.7%.
• Cash taxes paid were $63 million.
• Third quarter results included $53 million of pre-tax notable items, primarily environmental reserve adjustments, facility closure costs, and restructuring, partially offset by gains on the Ma'aden investment and foreign currency changes.

Guidance and Future Outlook:

• Full-year 2026 capital expenditures are expected to be $1.2 billion; 2027 is targeted below $1 billion.
• Full-year 2026 potash production is expected to be 8.6 million tonnes.
• Fourth quarter 2026 phosphate sales volumes are expected to be 1.3 to 1.6 million tonnes, with DAP prices averaging $820 to $840 per tonne.
• Fourth quarter 2026 potash sales volumes are expected to be 2.3 to 2.6 million tonnes, with MOP prices ranging from $255 to $275 per tonne.
• Mosaic Biosciences expects full-year 2026 net sales to double to $135 million.
• Free cash flow is expected to improve further in the fourth quarter, supported by working capital release and cost reductions.
• Earnings benefits from the fourth-quarter sulfur contract settlement are expected primarily in the first quarter of 2027.
• Fourth quarter segment adjusted EBITDA for Mosaic Fertilizantes is expected to be below third-quarter levels.
• Phosphate stripping margins and adjusted EBITDA are expected to decline further in the fourth quarter due to higher raw material costs flowing through inventory.

Business Segments and Product Lines:

• Potash: Net sales were $643 million (down from $695 million). Operating earnings were $189 million (down from $229 million). Adjusted EBITDA was $284 million (down from $329 million). Sales volumes were 2.1 million tonnes (down from 2.3 million tonnes). MOP cash cost of production was $73 per tonne. Production was impacted by abnormal geological conditions at Esterhazy and routine turnarounds.
• Phosphate: Net sales were $1.3 billion (flat with prior year). Operating loss was $194 million (compared to $102 million earnings). Adjusted EBITDA was $49 million (down from $280 million). Sales volumes were 1.4 million tonnes (down from 1.6 million tonnes) due to production curtailments from limited affordable sulfur. DAP selling price was $838 per tonne. Phosphate cash cost of conversion was $117 per tonne. Idle, turnaround, and unabsorbed fixed costs totaled $77 million.
• Mosaic Fertilizantes: Net sales were $1.3 billion (down from $1.6 billion). Operating loss was $21 million (compared to $96 million earnings). Adjusted EBITDA was $41 million (down from $241 million). Sales volumes were 1.9 million tonnes (down from 2.8 million tonnes) due to curtailed domestic production and limited customer credit. Phosphate cash cost of conversion was $147 per tonne. Idle, turnaround, and unabsorbed fixed costs totaled $70 million.
• Mosaic Biosciences: Year-to-date net sales doubled compared to the first nine months of 2025, supported by the launch of six new products. Up to four new products are expected in the fourth quarter.
• Corporate and Other: Operating loss was $70 million. Adjusted EBITDA was $(50) million.

Market and Competitive Landscape:

• Macroeconomic environment includes Middle East tensions, Strait of Hormuz bottlenecks, and strikes on energy/agricultural infrastructure in Russia/Ukraine.
• Strengthening El Niño conditions and underapplication of crop nutrients have tightened the agricultural backdrop, driving higher commodity prices and increased fertilizer demand, particularly in North America.
• Phosphate markets remain tight with improving demand and lingering supply disruptions. North American inventories are expected to stay low. Global phosphate production remains constrained by sulfur availability.
• Potash market fundamentals are positive with global demand expected to set a record. Chinese imports have exceeded last year's total.
• Escalating attacks in the Black Sea are constraining shipping and likely inhibiting export supplies from the region through the fourth quarter.
• Brazilian inventories are well below last year, setting the stage for pent-up import demand.
• China has exported minimal DAP or MAP volumes over the past quarter with little expected through spring.

Risks and Challenges:

• Production curtailments at South Fort Meade and Miski Mayo mines are expected to increase in the fourth quarter.
• Higher raw material costs for sulfur and ammonia continue to strain phosphate producer margins.
• Geological challenges at Esterhazy resulted in lower-than-expected ore grades, though expected to be temporary.
• Mosaic Fertilizantes faces challenges from reduced operating rates leading to higher unit cash conversion costs and fixed cost absorption issues.
• Geopolitical instability and disruptions to global shipping routes remain risks.
• Environmental reserve adjustments and facility closure costs impacted earnings.

Management Commentary and Tone:

• President and CEO Bruce Bodine stated the company made "meaningful progress" on actions within their control, including aligning phosphate production with affordable sulfur availability, reducing costs, and strengthening the financial position.
• Management expressed confidence that these actions position the company to deliver stronger performance as conditions improve.
• The tone indicates a focus on cost discipline and portfolio optimization despite current headwinds.

Other Key Points:

• The company settled a fourth-quarter sulfur contract at $615 per long ton.
• All long-term debt maturities were refinanced and extended through 2028.
• The $2.5 billion revolving credit facility remains fully available.
• A regular common dividend of $0.22 per share was paid in the third quarter.
• Capital expenditures for 2026 are now expected to be $1.2 billion.
• Strategic review of the asset portfolio is advancing, including $67 million in year-to-date land sales and the sale process for the Araxá facility in Brazil.
• Sensitivities indicate a $10/tonne price change impacts full-year adjusted EBITDA by $83 million for MOP and $60 million for DAP.