FMC Corp. (FMC, Financial) filed Quarterly Report for the period ended 2012-03-31.
Fmc Corp has a market cap of $7.62 billion; its shares were traded at around $109.8 with a P/E ratio of 18.4 and P/S ratio of 2.3. The dividend yield of Fmc Corp stocks is 0.7%. Fmc Corp had an annual average earning growth of 7.5% over the past 10 years. GuruFocus rated Fmc Corp the business predictability rank of 2.5-star.
Agricultural Products' operating profit of $129.7 million increased approximately 29 percent compared to the year-ago quarter, reflecting the broad-based sales growth partially offset by a 32 percent or $16 million increase in selling, general and administrative costs mainly for focused growth initiatives and to support growth in the business. In addition, segment earnings were also unfavorably impacted by higher research and development costs of 32 percent or $6.0 million due to higher spending associated with various innovation projects.
Other expense increased to $11.2 million in the first quarter of 2012 from $7.3 million in the same period of 2011. The first quarter of 2012 was impacted by a charge related to an increase in our LIFO inventory reserve of $3.9 million which for the three months ended March 31, 2011 was $1.4 million. Other income (expense), net is included as a component of the line item “Costs of sales and services” on our condensed consolidated statements of income.
Cash and cash equivalents at March 31, 2012 and December 31, 2011, were $70.8 million and $158.9 million, respectively. Of the cash and cash equivalents balance at March 31, 2012, $61.2 million were held by our foreign subsidiaries. Our intent is to reinvest permanently the earnings of our foreign subsidiaries and therefore we have not recorded taxes that would be payable if we repatriated these earnings. In the event that funds from our foreign subsidiaries are repatriated to the U.S., we would be required to accrue and pay U.S. taxes on those amounts.
Energy costs are approximately nine percent of our cost of sales and services and are diversified among coal, electricity, and natural gas. We attempt to mitigate our exposure to increasing energy costs by hedging the cost of future deliveries of natural gas and by entering into fixed-price contracts for the purchase of coal and fuel oil. To analyze the effect of changing energy prices, we have performed a sensitivity analysis in which we assume an instantaneous 10 percent change in energy market prices from their levels at March 31, 2012 and December 31, 2011, with all other variables (including interest rates) held constant. A 10 percent increase in energy market prices would result in a decrease in the net liability position of $3.2 million at March 31, 2012, compared to a $2.5 million decrease of the net liability position at December 31, 2011. A 10 percent decrease in energy market prices would result in an increase of $3.2 million in the net liability position at March 31, 2012, compared to an increase of $2.5 million of the net liability position at December 31, 2011.
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Fmc Corp has a market cap of $7.62 billion; its shares were traded at around $109.8 with a P/E ratio of 18.4 and P/S ratio of 2.3. The dividend yield of Fmc Corp stocks is 0.7%. Fmc Corp had an annual average earning growth of 7.5% over the past 10 years. GuruFocus rated Fmc Corp the business predictability rank of 2.5-star.
Highlight of Business Operations:
Revenue of $940.7 million for the three months ended March 31, 2012 increased $145.7 million or 18 percent versus the same period last year. Revenue increased in all businesses and in all regions. A more detailed review of revenues by segment are discussed further on under the section titled "Results of Operations". On a regional basis, sales in Europe, Middle East and Africa increased 8 percent, sales in Asia were up 14 percent, sales in Latin America grew 38 percent and sales in North America were up 14 percent.Agricultural Products' operating profit of $129.7 million increased approximately 29 percent compared to the year-ago quarter, reflecting the broad-based sales growth partially offset by a 32 percent or $16 million increase in selling, general and administrative costs mainly for focused growth initiatives and to support growth in the business. In addition, segment earnings were also unfavorably impacted by higher research and development costs of 32 percent or $6.0 million due to higher spending associated with various innovation projects.
Other expense increased to $11.2 million in the first quarter of 2012 from $7.3 million in the same period of 2011. The first quarter of 2012 was impacted by a charge related to an increase in our LIFO inventory reserve of $3.9 million which for the three months ended March 31, 2011 was $1.4 million. Other income (expense), net is included as a component of the line item “Costs of sales and services” on our condensed consolidated statements of income.
Cash and cash equivalents at March 31, 2012 and December 31, 2011, were $70.8 million and $158.9 million, respectively. Of the cash and cash equivalents balance at March 31, 2012, $61.2 million were held by our foreign subsidiaries. Our intent is to reinvest permanently the earnings of our foreign subsidiaries and therefore we have not recorded taxes that would be payable if we repatriated these earnings. In the event that funds from our foreign subsidiaries are repatriated to the U.S., we would be required to accrue and pay U.S. taxes on those amounts.
Energy costs are approximately nine percent of our cost of sales and services and are diversified among coal, electricity, and natural gas. We attempt to mitigate our exposure to increasing energy costs by hedging the cost of future deliveries of natural gas and by entering into fixed-price contracts for the purchase of coal and fuel oil. To analyze the effect of changing energy prices, we have performed a sensitivity analysis in which we assume an instantaneous 10 percent change in energy market prices from their levels at March 31, 2012 and December 31, 2011, with all other variables (including interest rates) held constant. A 10 percent increase in energy market prices would result in a decrease in the net liability position of $3.2 million at March 31, 2012, compared to a $2.5 million decrease of the net liability position at December 31, 2011. A 10 percent decrease in energy market prices would result in an increase of $3.2 million in the net liability position at March 31, 2012, compared to an increase of $2.5 million of the net liability position at December 31, 2011.
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