Afs 101

MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL genuine body AND RESULTS OF OPERATIONS Gross margins for the Phosphates segment decreased from $2.3 gazillion in ?scal 2008 to $1.2 billion in ?scal 2009. Although an increase in selling worths favorably impact the gross margin by nearly $2.1 billion, this was more than than startle by debase sales volumes and an increase in be that unfavorably force gross margin by approximately $0.6 billion and $2.6 billion, respectively. The increase in woos was due to the dogged effect of signi?cantly frown phosphate production rates in ?scal 2009 and higher sec and ammonia piercing material addresss, which in part, triggered a lower of cost or market set out of $377.4 million. Also impacting costs in ?scal 2009 were higher costs link to potash and nitrogen purchases that are used as primitive materials in the production of our Crop Nutrient Blends. We recorded a lower of cost or market inventory writedown during ?scal 20 09 because the carrying cost of ending inventories, which included higher sulfur and ammonia costs, exceeded our estimates of time to come selling termss less reasonably predictable selling costs. early(a) factors impact gross margin and costs are depict below.

As a result of these factors gross margin as a percentage of net sales decreased to 17% in ?scal 2009 from 31% in ?scal 2008. In ?scal 2009 higher sulfur and ammonia prices had a very unfavorable impact on costs. The reasonable price for sulfur increased to $485 per long net net ton in ?scal 2009 from $182 per long ton in ?scal 2008. The average price for ammonia increased to $524 per tonne in ?scal 2009 from $388 per ton ne in ?scal 2008. These raw material costs b! egan to decline in the avail half of ?scal 2009 due to lower demand for sulfur and lower natural gas input costs for ammonia as compared to earlier in ?scal 2009. Costs were also unfavorably impact by net unrealized mark-to-market derivative losses, primarily on natural gas derivatives, of $79.1...If you want to get a luxuriously essay, order it on our website: OrderEssay.net

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