form425.htm
Filed by
Terra Industries Inc.
pursuant
to Rule 425 under the
Securities
Act of 1933 and deemed
filed
pursuant to Rule 14a-12 and Rule 14d-9(a) of
the
Securities Exchange Act of 1934
Subject
Company: Terra Industries Inc.
Commission
File No.: 001-08520
The
following is a transcription of Terra Industries Inc.’s 2008 fourth quarter and
full-year results conference call:
TERRA
INDUSTRIES INC.
Moderator:
Joe Ewing
February
10, 2009
3:00 pm
ET
Operator
Good day,
ladies and gentlemen, and welcome to the fourth quarter 2008 Terra Industries
earnings conference call. My name is Noelia and I'll be your coordinator for
today. (Operator Instructions). I would now like to turn the presentation over
to your host for today's call Mr. Joe Ewing, Vice President of Investor
Relations. Please proceed.
Joe
Ewing
Okay.
Thank you, Noelia and welcome, everyone, to Terra's fourth quarter and full-year
results conference call.
This
morning we issued a news release announcing that for the 2008 fourth quarter,
Terra achieved net income of $165 million, or $1.65 per diluted share. We also
announced that for the full year Terra achieved its best results ever, net
income of $632 million, or $6.20 per diluted share.
At the
end of the news release is our Safe Harbor statement. It describes the
limitations of forward-looking statements and any other items that are not
historical facts included in the news release. Please note that those same
limitations apply to any forward-looking statements we may make during this
call.
With me
today are Mike Bennett, Terra's President and CEO and Dan Greenwell, Senior Vice
President and CFO.
Regarding
recent and upcoming investor relations activities since our last earnings call,
we've participated in an East Coast road show and three equity conferences.
Coming up later this quarter, we have the Wall Street Access Ag Conference on
March 4, and also a West Coast road show in mid-March.
You can
get more information about these events from our web site or by calling us. We
also always welcome visitors to Sioux City. If anyone listening today is
interested in coming to tour our Port Neal manufacturing facility and to meet
our management, we'd be happy to have you. Please call either Kim Mathers or me
to make those arrangements.
I'll now
turn the call over to Mike Bennett, so that he can give us his perspective on
the fourth quarter and the outlook for Terra and the industry in upcoming
months. Mike?
Mike
Bennett
Okay. Thanks,
Joe. Good afternoon, everyone. We appreciate your interest in Terra. Today I
would like to focus my comments on the performance of our business and briefly
discuss Terra's operating strategies.
Terra
closed out an all-time record year in 2008 with a solid fourth quarter
performance, despite unprecedented declines in global nitrogen prices as buyers
went to the sidelines out of concern for falling commodity prices and the global
economic crisis.
We
clearly felt the negative impact of the decline in traded industrial ammonia
prices in December that caused us to take a charge against current and future
ammonia inventories. We believe, however, that forward product sales served
us well as many of our agricultural nitrogen shipments in Q4 were
commitments we entered into earlier in the year. These commitments should be
largely completed in Q1 of this year for UAN and Q2 of this year for
ammonia.
As we
look at Q1, there's a significant value transition occurring as producers work
through higher cost inventory and begin to realize some benefit from improved
energy prices. Likewise, farm retailers are working with their grower customers
through a similar transition. Beyond Q1, the relationship between energy prices
and nitrogen market prices indicates potentially strong margin
opportunities.
The
recent improvement in nitrogen prices off end of the year lows is a good
indicator that buyers are gradually coming back into the market. We have
witnessed improved order activity over the past four or five weeks.
While it
is difficult to predict the exact level of corn acres that will be planted this
year, a level of plantings at or below that of last year will almost certainly
result in a further decrease in corn inventories. This is expected to create a
stronger incentive for corn production as we move through the year. Globally,
deferred nitrogen purchases have forced a significant level of production
curtailment, the net effect of which is still not clear. Terra has also taken
measures to adjust its production by shutting down plants or curtailing
production in light of changing domestic demand pattern in the fourth quarter.
In any event, a de-stocking of nitrogen has occurred, perhaps leading to a year
of further de-stocking of global grain inventories and resulting in pressure for
more grain production in the 2009-2010 crop year.
Our
estimates are that domestically perhaps as much as 5% of the annual requirement
for applied nitrogen was deferred from last fall to spring as a result of grower
uncertainty and the late harvest. This deferral was in the form of ammonia,
which will be difficult, if not impossible, to make up as ammonia this spring.
It may also be very challenging to offset this nitrogen demand with other
products. Terra, however, has strategically invested in ammonia upgrade capacity
in key locations and is well prepared to supply alternatives to direct applied
ammonia, such as UAN, to help end-users meet their application
needs.
With its
broad production footprint and substantial scale in domestic market, Terra
remains capable of responding to changes in demand. In fact, in anticipation of
robust spring demand, we are currently in the process of restarting our
Woodward, Oklahoma facility. Our Donaldsonville, Louisiana facility remains idle
for now. While we are encouraged by recent improvement in traded ammonia prices,
overall industrial ammonia demand remains weak and will likely take longer to
recover than agricultural demand. The strategy of diversified market channels
for our industrial businesses, such as mining services and environmental
technologies, has served us well in this environment, and is yet another example
of Terra's market-driven diversification strategies.
Finally,
I would like to comment on the progress of several important
initiatives:
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As
we announced in December, Brenntag is our distribution partner for our
long-range strategy of establishing Terra's diesel exhaust fluid,
TerraCair. As a leading brand in the U.S. Brenntag brings an
extensive distribution network and professional quality assurance that we
believe are essential to this important industrial market. We are excited
about the medium and long-term prospects for the business and product
line, and believe our unique manufacturing capabilities, geographic
locations and sharp focus on market development and service position us as
the industry leader. A limited amount of material is already moving
through the passenger car market, as well as for testing by various engine
manufacturers. The broad rollout of this product line in response to new
emission requirements will be in 2010. As such, we believe the groundwork
that Terra has laid over the past three years will serve us well, as this
market demand comes to fruition.
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Also
in 2010, we anticipate the startup of our new 500,000-ton-per-year UAN
capacity addition at Woodward. We are actually breaking ground this month
on the project and it is on schedule. The Woodward project is yet another
example of Terra's ongoing strategic planning and capital management
efforts to enhance shareholder value through system-wide reductions in
direct applied agricultural ammonia. We look forward to the improved
financial returns, added operating flexibility and enhanced market service
capability this project represents to Terra and its
shareholders.
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Before I
turn the call over to Dan, I would also point out that Terra finished 2008 with
an exceptionally strong balance sheet. And this, I think, is a real and
substantial asset for us and our shareholders in such tumultuous times in the
economy.
Terra's
disciplined capital management and strong balance sheet further enable us to
pursue strategies that we believe will create the greatest value for our
shareholders. In fact, Terra has a long history of effective capital deployment
and has built its business since the 1980s on a series of significant asset
purchases and acquisitions. These acquisitions have included operations in North
America, Trinidad and Europe, and a variety of standalone and joint venture
arrangements, including our general partnership interest in the master limited
partnership Terra Nitrogen, LP, here in the U.S. Terra's success in
integrating these acquisitions has resulted in an enterprise of global
operations, prime locations in critical end-use markets, access to
cost-advantage raw materials and diversity of products and markets served to
enhance growth and mitigate risk. And the Woodward project and development of
the DEF market are just two of the recent examples of Terra's ongoing efforts to
create value now and in the future.
I think
it's also noteworthy that Terra has returned over one-third of its cumulative
net income over the last three years to shareholders in the form of share
buybacks and dividends. We will continue to focus our efforts on the best
avenues for shareholder value as we go forward, and appreciate your ongoing
support of our efforts on your behalf.
With
that, I'd like to turn the call over to Dan Greenwell to provide an update on
some of the specifics of our financial position and performance.
Dan?
Dan
Greenwell
Thank
you, Mike, and good afternoon to everyone.
Mike has
highlighted the solid fourth quarter results and improving demand for nitrogen
products. I'd first like to round out our discussion of the top line with a few
comments about product selling prices and volumes, and about the impact of
natural gas costs on the bottom line. Then I'll follow with additional comments
about our operating results and our joint venture operations located in the
United Kingdom and Trinidad, our restart of the Woodward, Oklahoma plant, and
then discuss the future benefits from our more efficient tax
structure.
I'll then
spend a few moments on the year-to-date results and summarize some of the 2008
financial highlights.
Finally,
we’ll close with a summary of our strong liquidity position and a discussion of
returns to shareholders.
Fourth
quarter net income available to common shareholders was $165 million or $1.65
per share compared to last year’s $68 million or $0.66 per share. We’re pleased
with this performance during these difficult economic times.
Full-year
net income available to common shareholders in 2008 was $632 million or $6.20
per share. This compares with 2007 net income per share of $1.90.
Revenues
of $683 million in the fourth quarter of 2008 increased by $114 million as
compared to last year. Selling prices increased revenues by about $220 million,
while lower volumes off set revenues by $106 million compared with 2007
results.
As we
previously noted, our Woodward and Donaldsonville facilities were idled during
December. We estimate our aggregate monthly cash cost of maintaining these
facilities in an idled mode is approximately $2 million. The combined cash cost
to restart these plants will be approximately $1 million, which is primarily
associated with natural gas usage during warm up.
As a
result of the significant market price changes in ammonia during December, we
reviewed our inventory positions at year-end and reported an $18 million charge
for inventory lower-of-cost-or-market-valuation adjustment. We also took a
forward view into the first quarter and wrote off derivative positions
associated with the idled Woodward and Donaldsonville facilities and other cost
positions above the anticipated market. The aggregate derivative position charge
was approximately $32 million. The combined inventory and derivative charge
during the fourth quarter was approximately $50 million on a pre-tax
basis.
On
December 31st, we finalized the sale of the Beaumont Texas methanol plant to
Eastman Chemical Company. We received $42 million in cash and a one-year
promissory note of approximately $5 million. There was no gain or loss on the
sale since the facility was recorded on our accounts at the estimated realizable
value.
Natural
gas costs increased by approximately $106 million during the fourth quarter of
2008, as compared to the prior year due to price changes. The 2008 fourth
quarter impact from settled and written off derivative positions was
approximately $190 million compared to $22 million in the 2007 fourth
quarter.
The
annual impact of hedging our firm price fixed sales activities was approximately
$173 million in 2008 compared to $54 million in the prior year.
Our
derivative position values above market that we carry into 2009 approximate $66
million and are associated with firm open orders taken in mid-2008. The majority
of these positions will settle in the first and second quarters.
The
year-over-year decrease to fourth quarter selling, general and administrative
expenses was $12 million, primarily due to share-based compensation. The
decrease results from the mark-to-market accounting treatment for the phantom
share program.
Total
long-term incentive compensation plans consisting of restricted and phantom
share programs had 2008 annual expense of $8 million compared to $31 million in
2007.
Our
United Kingdom nitrogen joint venture with Yara generated $6.6 million of
earnings during the fourth quarter and $96 million for the year. Additionally,
the joint venture returned approximately $62 million of cash during the fourth
quarter as balancing consideration under the joint venture arrangement. Terra is
entitled to an additional 22 million pounds or approximately $32 million if the
operations continue to perform well.
To put
the joint venture operations in perspective, the total nitrogen sales of the
United Kingdom joint venture in 2008 were approximately $1.1
billion.
The total
cash received during 2008 from the United Kingdom was approximately $89 million.
We’re very pleased with the performance that this international joint venture
provided during 2008.
Our North
American joint venture nitrogen operations consisting primarily of our Trinidad
ammonia plant operated in conjunction with Koch Industries, provided earnings of
approximately $11 million during the fourth quarter and $56 million for the
year. The Trinidad operation provides Terra with an advantaged gas position for
approximately 350,000 tons of ammonia annually that we bring into our
Donaldsonville terminal. During 2008, we received approximately $72 million of
distributions from our North American joint ventures.
It’s
worth noting that the earnings associated with Terra’s United Kingdom and
Trinidad joint venture arrangements, are not consolidated but rather reported as
equity earnings. As we evaluate Terra’s overall nitrogen business, it is most
appropriate to consider these unconsolidated equity earnings as part of the
overall return that our operations generate in the conduct of our global pure
play nitrogen business.
One item
you may have noticed on our balance sheet was the consistency of the pension
liability at the end of 2008 compared to 2007. During the first quarter of 2008,
we made a decision to reallocate pension assets into a high-quality, long
duration bond investment mix. This decision has served us well and
has enabled us to weather the economic storm without increasing our pension
liabilities. Our qualified defined benefit plans are fully funded at the end of
2008 and have assets of approximately $285 million. For clarity, none of our
pension assets are invested in illiquid asset classes.
Terra’s
effective tax rate, after minority interest and United Kingdom equity earnings,
was 27.5% for the year. During the fourth quarter of 2008, we implemented
multiple tax strategies to lower the effective tax rates and the amount of cash
taxes paid. A key aspect of the optimization strategy included the
reorganization of Terra’s subsidiary ownership structure for our international
operations. This new structure will provide cash saving benefits in the form of
lower tax payments. We recognize the benefit of approximately $33 million
related to the international tax optimization activities. In addition, during
the fourth quarter of 2008, we recognized approximately $20 million of state and
federal tax credits.
Net cash
tax payments in 2008 were $199 million. We paid $22 million of taxes in
2007.
Our tax
planning initiatives completed in 2008 should provide benefit in future periods.
As a result, we now estimate a 2009 effective annual tax rate between 30 and
32%.
During
the fourth quarter, we bought back approximately 2.8 million shares of our
common stock at an average price of approximately $17.82 per share. Aggregate
cost for the repurchase during the quarter was $50 million. We currently have
99.3 million shares outstanding.
Our
current buyback program extends through June 2010 and we have 7.4 million shares
available to purchase under the authorization. We anticipate making further
buybacks under the repurchase program and will do so at times and in quantities
we believe will generate the best value to our shareholders.
As Mike
mentioned in his opening remarks, during the past three years, Terra has
returned approximately 35% of income available to common shareholders in the
form of dividends or stock buybacks. We initiated these returns in 2006 and have
increased the amount each year. We will continue to seek appropriate means and
look forward to providing additional returns to our shareholders.
Our cash
and derivative margin deposits aggregate to $1 billion at the end of 2008. Our
cash is invested in high-quality money funds that remain highly liquid. As
mentioned previously, none of our cash balances are invested in illiquid asset
classes. Cash balances have increased since year-end. Today, Terra’s cash
balances remain in excess of $1 billion.
We spent
approximately $76 million for normal maintenance capital and turnarounds during
2008. In addition, we initiated the Woodward UAN expansion and spent
approximately $13 million. Total capital expenditures and turnaround spending
was $89 million in 2008.
In 2009,
we will undergo turnaround at our Yazoo City, Woodward and one-half of the
Verdigris plant. We will also have a turnaround on the Courtright urea plant in
2009. The Yazoo City plant turnaround is currently underway.
We
estimate our annual 2009 sustained capital expenditures and turnaround costs
will total between $85 and $90 million. We also estimate our Woodward UAN
expansion will require between $105 and $110 million. In the aggregate, we
estimate our 2009 capital and turnaround spending will be in the range of $190
to $200 million.
Terra
declared a $0.10 per common share dividend payable on April 7, 2009 to
shareholders of record as of March 18, 2009.
2008 was
a very robust year for Terra. Our strong liquid balance sheet combined with our
diverse well positioned asset-base, including our international joint ventures,
should allow us to grow revenues, earnings and shareholder value in the future.
As Mike mentioned, Terra has built its business on a series of substantial
acquisitions that in retrospect have proven to be financially sound, accretive
to earnings and positioned us for growth. We remain committed to a
forward-looking and disciplined capital management approach that will ensure our
ability to take advantage of new opportunities in the future. We appreciate your
ongoing support.
At this
time, I’d like to turn the call back to Mike Bennett. Mike?
Mike
Bennett
Thanks,
Dan. Before we open the call to questions, I want to make a very brief comment
on the CF Industries unsolicited proposal to combine our companies. Simply to
say, as you know, on January 28th after careful consideration, Terra’s board of
directors unanimously concluded that the CF unsolicited proposal does not
present a compelling case to create additional value for the shareholders of
either company, and it substantially undervalues Terra on an absolute
basis and relative to CF.
Our board
and management team remain committed to enhancing shareholder value by
continuing to execute our strategic plan, which we believe will deliver
significantly more value to shareholders than CF’s proposal. And basically this
concludes my prepared remarks on this matter.
I would
like to remind everyone that the purpose of today’s call is to discuss our
fourth quarter performance and full year 2008 results as well as our outlook for
2009. As such I ask that you limit your questions today to those topics. With
that, at this time I would turn the call back over to Noelia so that she can
instruct you on how to pose questions to us. Noelia?
Operator
Thank
you. (Operator Instructions). Your first question comes from the line of Charlie
Rentschler with Wall Street Access.
Charlie
Rentschler – Wall Street Access
Thank
you. Mike, your company obviously has two pretty darn well-defined avenues for
organic growth and you talked about each of them, the diesel engine fluid or AUS
and then direct applied ammonia, which I guess is a shift from anhydrous to UAN.
And it seems like you’re really kicking the latter thing in gear doubling—more
than doubling, I guess—your CapEx for ’09 with the big Woodward
project.
I’m
wondering—the diesel engine fluid is obviously a function of SCR and how quick
those trucks get on the road etc., but the other one is obviously dependent upon
the switch from anhydrous to UAN and how quick that happens, and could you talk
about your outlook on how fast that could happen and what kind of upside could
this present and physically beyond the Woodward upgrade, what would you do?
Could there be a really quick shift—quicker than anybody thinks in this
transition?
Mike
Bennett
Well,
thanks for the questions Charlie. I guess, yes, we’ve been talking for years
that at some point direct applied anhydrous would be a thing of the past and
basically it’s still here in about the same proportion overall that it has been.
But really as we look at even the last few years and some of the changes in
cultural practices and farming, what we’ve experienced is that growers with
these new hybrids want that seed in the ground more quickly than they did
in the past, so whereas it used to be that getting their corn planted by the
middle of May seemed like an adequate period for these guys what we’ve
seen is a trend more toward wanting to have that seed in the ground by early in
May, and with the shift in the corn acreage paradigm in the U.S., roughly today
we’re producing—or I guess planting—about 15 to 20% more corn acres than we were
in the earlier part of the decade. Basically we’ve got roughly the same number
of farmers out there planting this increased acreage.
And with
the window deadline or relatively narrow window, if you will, to apply nitrogen,
especially in the spring, we believe that UAN’s value has on a relative basis
been highlighted pretty clearly here in the last couple of years.
So from
our perspective as we continue to produce a relatively strong level of corn
acres, as this application window to get that nitrogen down continues to be
compressed, we think that UAN is a product that will command appropriate value,
given the things that it can do for the farmer from that perspective, and that’s
at least one key part of the shift that we anticipate.
Charlie
Rentschler, Wall Street Access
Well just
as a follow-up, it’s a 500,000-ton project, the swing at Woodward, which is what
about 12% of your UAN capacity—something like that?
Mike
Bennett
Probably
somewhere in that ballpark, Charlie.
Charlie
Rentschler, Wall Street Access
Where
would you go next, I guess, is what I’m wondering. Let’s say the railroads just
flat out didn’t want to haul anhydrous or something like that.
Mike
Bennett
Sure.
Well, obviously those types of things are considerations as well. When you look
at our system, Charlie, we currently upgrade most of the ammonia at Port Neal.
With this project we’ll be upgrading most of the ammonia at
Woodward.
We do
have a relatively minor amount of merchant ammonia that possibly could be
upgraded at Verdigris in the future. That certainly would be one consideration,
and probably the other key one would be our Canadian plant at Courtright, which
does have a fairly significant amount of AG and industrial ammonia. That’s also
a key plant for DEF markets, Charlie, and definitely will be a plant that we
have and will continue to look at relative to additional upgrading capacity in
the future.
Operator
Your next
question comes from the line of Steve Byrne with Bank of America/Merrill
Lynch.
Steve
Byrne, Bank of America/Merrill Lynch
Hi, Mike.
Based on your natural gas cost locked in at this time, which are essentially
identical to where they were a year ago, it would suggest your order book is
roughly the same. That seems a little odd given a year ago nitrogen prices were
starting to race and here we’ve had over the last few months nitrogen prices
really contracting.
And your
customers are in a bit of a jam with where price expectations are for
growers versus their cost position. Is that not a dilemma that you see in the
market or is it that your order book was basically locked in a few months ago
before this dilemma developed for your customers?
Mike
Bennett
Well,
first of all, Steve, I guess a good share of that year-end order book would have
been actually concluded back in as early as Q2 and possibly Q3 of 2008. And I
think the other thing I would point out on gas forwards always is that as we’ve
talked in the past, we do have the discretion to take some pretty limited long
positions and so certainly as we have seen natural gas prices come off pretty
substantially over the period of the fourth quarter and into the current, we
have also worked within our policy to maintain a bit of length on that
position.
Steve
Byrne, Bank of America/Merrill Lynch
Is your
order book for the first quarter at risk if some of your customers can't move
the product that they have? Is that an issue for you?
Mike
Bennett
At this
point in time, Steve, we don't see it as a significant risk. Basically we've
been working with our customers closely on a lot of those issues. I would say in
the case of ammonia, which wasn't able to be put down in the fall that obviously
some of that ammonia, as I mentioned in my remarks, likely won't be able to move
until Q2. But the UAN orders for the most part were basically given to us to
fill storage that customers have, and we bascially expect that to continue to
move through Q1.
Steve
Byrne, Bank of America/Merrill Lynch
And are
you seeing any of your customers solve their log jam with their grower price
expectations by writing down inventory or are they selling through in order to
turn their inventory?
Mike
Bennett
Well, I
think broadly speaking, as I mentioned in my remarks, Steve, I really think it's
somewhat of a transitional process in that, not every customer's going to be
realistic about the realities of higher cost inventory. The fact of the matter
is that the entire chain, all the way from producers through dealers, had higher
cost inventory committed at a time when things were much different.
And I
think many of our customers are working with their customers to kind of temper
those expectations and make a more realistic assessment of what can be done as
we move through the spring. And, certainly, as I mentioned, we have seen some
increased order activity here over the last month or so.
And I
think to a large extent that is a process of customers filling out their UAN
order activity and, perhaps in some cases, additional ammonia requirements to
help average in a better overall cost position for their spring season with
their customers.
Operator
Your next
question comes from the line of Sachin Shah with ICAP.
Sachin
Shah, ICAP Securities
Hi, good
aftersooon. Thanks for taking my call. I just want to find out about
returning value to shareholders. You did mention dividends as well as share
repurchases. Have you considered acquiring the remaining stake of TNH as well
as, is there a possibility for a special dividend? I'm just trying to understand
it. And also maybe you could comment on the timing of such analysis. And then
one final question about the 2009, you did mention the outlook but I was just
wondering if you could give further guidance based on what is going on in the
economy?
Mike
Bennett
Okay.
Thank you. First of all, as our board meets we discuss all different types of
avenues under which we might return value to shareholders. Certainly we
re-instituted our dividend in part to make a statement about how we saw the
company's viability through a wide variety of cyclical conditions going
forward.
We felt
that the share buybacks, as we have executed them, have represented good value
in the context of the period that we've been in and other items such as, all the
way from possibly special dividends to, certainly, continued acquisitions are
things that we explore and discuss.
I
wouldn't preclude the board's judgment on these matters as we go forward, and it
would be very difficult for me to predict exactly what form those may take
beyond the forms that we've used to date. As far as '09 goes, I hope I didn't
give any guidance before because typically we do our best to refrain from
that.
But I
think in our remarks, broadly speaking, what we indicated is that we still see
the potential for a very positive agricultural environment as we go forward, and
certainly Q4 was a transitional period as is Q1. We've seen unprecedented value
changes in these markets, but as things get back on a steady basis, which we
think should happen in Q2 on through the year, we think the demand for grain
will continue to look good.
We think
the demand for U.S. produced grain and inputs required to meet those needs
should be solid. From an economic perspective, as we commented, some of the
industrial sectors certainly have been impacted severely by the economic
situation. And certainly companies that use products like ammonia as
intermediate chemicals in a process, we've seen some of those folks announce
fairly significant cutbacks in production. And my guess is that those particular
industries and that particular demand segment will recover more slowly, more in
accordance with pace of the general economy.
Sachin
Shah, ICAP Securities
Just one
follow-up if you don't mind. As far as the challenging market is concerned, I
appreciate your comments on 2009. You do have a potential for a proxy situation
with CF, I just wanted to understand how the company morally, with its current
employees, as well as the challenges that are present, as you outlined in the
first quarter—how are they addressing them and taking them into context as the
board meets also?
I guess
what I'm trying to understand is with the challenges in the economy, the
challenges that you've mentioned, how is the company/board addressing a
potential proxy situation and the distraction that it may have to its employees
and the goals that are basically set for this year?
Mike
Bennett
Sure, and
I appreciate that. While we aren't going to comment on the proposal and
situation per se, what I can tell you is that this is a company that for the
most part has employees with significant tenure. I think our average employee
has been with the company for something like 17 or 18 years. And it's a company
that has been through many difficult periods in the past and certainly in the
1999 through 2003 period, many people probably considered us pretty close to the
edge.
And at
the end of the day our employees have been resilient. They are focused and they
are dedicated, and we have no doubt that regardless of what distractions may or
may not present themselves, that we will be focused and deliver the best
performance possible this year, given the circumstances that the market itself
dictates to us.
Sachin
Shah, ICAP Securities
Okay. Thank you very
much.
Operator
There are
no further questions in the queue. I’m going to go ahead and turn the call back
to Mr. Joe Ewing for closing remarks.
Joe
Ewing
Hey,
Mike, do we have any closing remarks?
Mike
Bennett
No
closing remarks. I just want to thank you all again for your interest in Terra
and appreciate you joining us today. As Joe indicated, we always like to have
visitors and would love to have you out to Sioux City. It's getting warmer out
here—orange trees are starting to blossom. So please come see us and we'll look
forward to talking with you again on our Q1 conference call in April. Thank
you.
Operator
Thank you
for your participation in today’s conference. This concludes the presentation.
You may now disconnect. Have a great day.
Important
information and where to find it
Terra
Industries Inc. (“Terra”) plans to file with the Securities and Exchange
Commission (the “SEC”) and mail to its shareholders a proxy statement in
connection with its 2009 Annual Meeting. Investors and security holders are
urged to read the proxy statement relating to the 2009 Annual Meeting and any
other relevant documents filed with the SEC when they become available, because
they will contain important information. Investors and security holders
may obtain a free copy of the proxy statement and other documents (when
available) that Terra files with the SEC at the SEC’s Web site at www.sec.gov
and Terra’s Web site at www.terraindustries.com. In addition, the proxy
statement and other documents filed by Terra with the SEC may be obtained from
Terra free of charge by directing a request to Terra Industries Inc., Attn:
Investor Relations, Terra Industries Inc., 600 Fourth Street, P.O. Box 6000,
Sioux City, IA 51102-6000.
The
exchange offer announced by CF and described in this communication has not yet
commenced and this communication is neither an offer to purchase nor the
solicitation of an offer to sell any securities. At an appropriate time and if
the exchange offer is commenced, Terra intends to file a
solicitation/recommendation statement with respect to the exchange offer with
the SEC. Investors and security
holders are urged to read the solicitation/recommendation statement with respect
to the exchange offer and any other relevant documents filed with the SEC when
they become available, because they will contain important information.
Investors and security holders may obtain a free copy of the
solicitation/recommendation statement with respect to the exchange offer and
other documents (when available) that Terra files with the SEC at the SEC's Web
site at www.sec.gov and Terra's Web site at www.terraindustries.com. In
addition, the solicitation/recommendation statement with respect to the exchange
offer and other documents filed by Terra with the SEC may be obtained from Terra
free of charge by directing a request to Terra Industries Inc., Attn: Investor
Relations, Terra Industries Inc., 600 Fourth Street, P.O. Box 6000, Sioux City,
IA 51102-6000.
Certain
Information Concerning Participants
Terra,
its directors and executive officers may be deemed to be participants in the
solicitation of Terra’s security holders in connection with its 2009 Annual
Meeting. Security holders may obtain information regarding the names,
affiliations and interests of such individuals in Terra’s Annual Report on
Form 10-K for the year ended December 31, 2007, which was filed
with the SEC on February 28, 2008, and its proxy statement for the 2008 Annual
Meeting, which was filed with the SEC on February 29, 2008. To the extent
holdings of Terra securities have changed since the amounts printed in the proxy
statement for the 2008 Annual Meeting, such changes have been or will be
reflected on Statements of Change in Ownership on Form 4 filed with the SEC.
Additional information regarding the interests of such individuals can also be
obtained from the proxy statement relating to the 2009 Annual Meeting when it is
filed by Terra with the SEC. These documents (when available) may be
obtained free of charge from the SEC’s Web site at www.sec.gov
and Terra’s Web site at www.terraindustries.com.
Forward-looking
statement
Certain
statements in this news release may constitute “forward-looking” statements
within the meaning of the Private Litigation Reform Act of
1995. Forward-looking statements are based upon assumptions as to
future events that may not prove to be accurate. These statements are
not guarantees of future performance and involve risks, uncertainties and
assumptions that are difficult to predict. Actual outcomes and
results may differ materially from what is expressed or forecasted in these
forward-looking statements. As a result, these statements speak only
as of the date they were made and Terra undertakes no obligation to publicly
update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise.
Words
such as “expects,” “intends,” “plans,” “projects,” “believes,” “estimates,” and
similar expressions are used to identify these forward-looking
statements. These include, among others, statements relating
to:
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general
economic conditions within the agricultural
industry,
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competitive
factors and price changes (principally, sales prices of nitrogen and
methanol products and natural gas
costs),
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the
seasonality of demand patterns,
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environmental
and other government regulation,
and
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agricultural
regulations.
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Additional
information as to these factors can be found in Terra’s 2007 Annual Report/10-K,
in the section entitled “Business,” “Legal Proceedings,” and “Management’s
Discussion and Analysis of Financial Condition and Results of Operations” and in
the Notes to the consolidated financial statements.
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