DBRS Releases Report on Potash Corporation of Saskatchewan Inc.

DBRS has today released a report on Potash Corporation of Saskatchewan Inc. (PCS or the Company) that provides further detail on the July 29, 2014, confirmation of the Company’s BBB (high) Issuer Rating and Senior Unsecured Debt rating and its R-1 (low) Commercial Paper rating, all with Stable trends.

PCS’s status as a leading fertilizer producer is being enhanced as it nears completion of a multi-year program to expand its potash production capacity by 50%, which is expected to provide 18 million tonnes per year of nameplate capacity by 2015. The Company’s increased scale and presence in the potash market is expected to allow it to reap the benefits of potash demand growth over the next several years.

The Company’s credit metrics have deteriorated somewhat over the last few years from levels strong for its rating in 2011 as earnings and cash flow have weakened due to declines in potash and phosphate prices. Accordingly, despite the possibility that the Company’s financial metrics may improve as fertilizer prices improve and as expanded potash capacity is utilized, PCS will need to carefully manage expenditures for shareholder returns or acquisitions if it wishes to remain on track for improvement in its financial strength.

Notes:
The applicable methodology is Rating Companies in the Mining Industry, which can be found on our website under Methodologies.

The full report providing additional analytical detail is available by clicking on the link below or by contacting us at info@dbrs.com.