MADISON — Phosphate Holdings Inc. (PHI) reports a second quarter 2010 loss of $4.9 million, or $0.58 per diluted share of common stock, compared to earnings of $100,000, or $0.01 per diluted share of common stock, for the same period in 2009.
Total net sales for the second quarter of 2010 were $62.1 million, a 45 percent increase from total net sales of $42.7 million for the second quarter of 2009.
The company had an operating loss of $7.1 million for the second quarter of 2010, compared to operating income of $100,000 for the prior-year period. Earnings before interest, taxes, depreciation and amortization (EBITDA) for the second quarter of 2010 was negative $4.6 million, compared to positive EBITDA of $3.0 million for the second quarter of 2009.
Robert E. Jones, CEO of PHI, said, “Operationally, the second quarter of 2010 was challenging. For the quarter, the company’s sulfuric acid production was approximately 66 percent of planned levels. Production rates at both sulfuric acid plants were impacted by problems with the interstage absorption coolers.
“Moreover, we had a boiler failure in one of our sulfuric acid plants, which shut that sulfuric acid plant down for 27 days during the quarter. The boiler has been repaired and the sulfuric acid plant came online on June 24, 2010.”
As of June 30, PHI had a cash balance of approximately $3.1 million and borrowings under its revolving credit agreement of $8.1 million. The company said it continues to aggressively manage its liquidity and believes that its current operations and available credit facilities should be adequate to meet PHI’s financing needs for 2010.
Jones said, “We view the second half of 2010 as promising. With expectations of an early harvest and another large U.S. corn crop in 2011, fertilizer applications should be robust. Phosphate inventories throughout the chain are generally low. Demand for phosphates remains strong as India continues to purchase large phosphate volumes. South America restocking requirements are emerging and the U.S. market is strong.”