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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



FORM 10-Q



(Mark One)    

ý

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2013

OR

o

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the transition period from                               to                              

Commission file number 001-32597

CF INDUSTRIES HOLDINGS, INC.
(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation or organization)
  20-2697511
(I.R.S. Employer
Identification No.)

4 Parkway North, Suite 400
Deerfield, Illinois
(Address of principal executive offices)

 

60015
(Zip Code)

(847) 405-2400
(Registrant's telephone number, including area code)

        Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý    No o

        Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ý    No o

        Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ý   Accelerated filer o   Non-accelerated filer o
(Do not check if a smaller reporting company)
  Smaller reporting company o

        Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o    No ý

        57,312,668 shares of the registrant's common stock, $0.01 par value per share, were outstanding at October 31, 2013.

   


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CF INDUSTRIES HOLDINGS, INC.

TABLE OF CONTENTS

PART I.   Financial Information    

 

 

Item 1.

 

Financial Statements (unaudited)

 

 
        Consolidated Statements of Operations   1
        Consolidated Statements of Comprehensive Income   2
        Consolidated Balance Sheets   3
        Consolidated Statements of Equity   4
        Consolidated Statements of Cash Flows   5
        Notes to Unaudited Consolidated Financial Statements   6

 

 

Item 2.

 

Management's Discussion and Analysis of Financial Condition and Results of Operations

 

45

 

 

Item 3.

 

Quantitative and Qualitative Disclosures About Market Risk

 

72

 

 

Item 4.

 

Controls and Procedures

 

73

PART II.

 

Other Information

 

74

 

 

Item 2.

 

Unregistered Sales of Equity Securities and Use of Proceeds

 

74

 

 

Item 4.

 

Mine Safety Disclosures

 

74

 

 

Item 6.

 

Exhibits

 

74

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CF INDUSTRIES HOLDINGS, INC.

PART I—FINANCIAL INFORMATION

ITEM 1.    FINANCIAL STATEMENTS.


CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

 
  Three months ended
September 30,
  Nine months ended
September 30,
 
 
  2013   2012   2013   2012  
 
  (in millions, except per share amounts)
 

Net sales

  $ 1,097.0   $ 1,359.4   $ 4,148.4   $ 4,622.6  

Cost of sales

    710.9     657.4     2,222.0     2,165.5  
                   

Gross margin

    386.1     702.0     1,926.4     2,457.1  
                   

Selling, general and administrative expenses

    32.2     36.5     121.0     111.6  

Other operating—net

    (20.3 )   8.6     (9.2 )   41.7  
                   

Total other operating costs and expenses

    11.9     45.1     111.8     153.3  

Equity in earnings of operating affiliates

    11.2     10.2     32.3     39.5  
                   

Operating earnings

    385.4     667.1     1,846.9     2,343.3  

Interest expense

    41.0     28.7     112.4     104.9  

Interest income

    (1.0 )   (1.6 )   (4.1 )   (2.0 )

Other non-operating—net

    (0.3 )   (0.2 )   54.1     (0.9 )
                   

Earnings before income taxes and equity in earnings of non-operating affiliates

    345.7     640.2     1,684.5     2,241.3  

Income tax provision

    109.0     206.0     499.3     722.0  

Equity in earnings of non-operating affiliates—net of taxes

    7.2     23.9     6.2     48.8  
                   

Net earnings

    243.9     458.1     1,191.4     1,568.1  

Less: Net earnings attributable to noncontrolling interest

    9.8     54.8     52.6     190.1  
                   

Net earnings attributable to common stockholders

  $ 234.1   $ 403.3   $ 1,138.8   $ 1,378.0  
                   

Net earnings per share attributable to common stockholders:

                         

Basic

  $ 4.09   $ 6.43   $ 19.12   $ 21.47  
                   

Diluted

  $ 4.07   $ 6.35   $ 19.01   $ 21.19  
                   

Weighted average common shares outstanding:

                         

Basic

    57.3     62.8     59.6     64.2  
                   

Diluted

    57.5     63.5     59.9     65.0  
                   

Dividends declared per common share

  $ 0.40   $ 0.40   $ 1.20   $ 1.20  
                   

   

See Accompanying Notes to Unaudited Consolidated Financial Statements.

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CF INDUSTRIES HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

 
  Three months ended September 30,   Nine months ended September 30,  
 
  2013   2012   2013   2012  
 
  (in millions)
 

Net earnings

  $ 243.9   $ 458.1   $ 1,191.4   $ 1,568.1  

Other comprehensive income (loss):

                         

Foreign currency translation adjustment—net of taxes

    39.5     27.8     (28.7 )   48.4  

Unrealized gain (loss) on hedging derivatives—net of taxes

    3.9         (0.3 )    

Unrealized (loss) gain on securities—net of taxes

    (0.3 )   1.1     0.3     1.5  

Defined benefit plans—net of taxes

    (0.4 )   9.3     5.0     12.5  
                   

    42.7     38.2     (23.7 )   62.4  
                   

Comprehensive income

    286.6     496.3     1,167.7     1,630.5  

Less: Comprehensive income attributable to the noncontrolling interest

    9.8     55.7     51.9     191.1  
                   

Comprehensive income attributable to common stockholders

  $ 276.8   $ 440.6   $ 1,115.8   $ 1,439.4  
                   

   

See Accompanying Notes to Unaudited Consolidated Financial Statements.

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CF INDUSTRIES HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS

 
  (Unaudited)
September 30,
2013
  December 31,
2012
 
 
  (in millions, except share
and per share amounts)

 

Assets

             

Current assets:

             

Cash and cash equivalents

  $ 2,286.2   $ 2,274.9  

Restricted cash

    111.4      

Accounts receivable—net

    186.9     217.4  

Inventories—net

    357.4     277.9  

Prepaid income taxes

    35.8      

Deferred income taxes

    44.1     9.5  

Other

    37.9     27.9  
           

Total current assets

    3,059.7     2,807.6  

Property, plant and equipment, net of accummulated depreciation, depletion and amortization of $2,995.7 and $2,757.1, respectively

    4,250.0     3,900.5  

Asset retirement obligation funds

    200.8     200.8  

Investments in and advances to affiliates

    931.8     935.6  

Goodwill

    2,064.5     2,064.5  

Other assets

    292.2     257.9  
           

Total assets

  $ 10,799.0   $ 10,166.9  
           

Liabilities and Equity

             

Current liabilities:

             

Accounts payable and accrued expenses

  $ 466.9   $ 366.5  

Income taxes payable

    3.6     187.1  

Customer advances

    433.3     380.7  

Notes payable

        5.0  

Distributions payable to noncontrolling interest

        5.3  

Other

    9.1     5.6  
           

Total current liabilities

    912.9     950.2  
           

Long-term debt

    3,098.0     1,600.0  

Deferred income taxes

    870.1     938.8  

Other noncurrent liabilities

    456.0     395.7  

Equity:

             

Stockholders' equity:

             

Preferred stock—$0.01 par value, 50,000,000 shares authorized

         

Common stock—$0.01 par value, 500,000,000 shares authorized, 2013—59,327,573 shares issued and 2012—62,961,628 shares issued

    0.6     0.6  

Paid-in capital

    1,659.0     2,492.4  

Retained earnings

    3,880.6     3,461.1  

Treasury stock—at cost, 2013—2,018,950 shares and 2012—10,940 shares

    (361.7 )   (2.3 )

Accumulated other comprehensive loss

    (72.6 )   (49.6 )
           

Total stockholders' equity

    5,105.9     5,902.2  

Noncontrolling interest

    356.1     380.0  
           

Total equity

    5,462.0     6,282.2  
           

Total liabilities and equity

  $ 10,799.0   $ 10,166.9  
           

   

See Accompanying Notes to Unaudited Consolidated Financial Statements.

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CF INDUSTRIES HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF EQUITY

(Unaudited)

 
  Common Stockholders    
   
 
 
  $0.01 Par
Value
Common
Stock
  Treasury
Stock
  Paid-In
Capital
  Retained
Earnings
  Accumulated
Other
Comprehensive
Loss
  Total
Stockholders'
Equity
  Noncontrolling
Interest
  Total
Equity
 
 
  (in millions)
 

Balance at December 31, 2011

  $ 0.7   $ (1,000.2 ) $ 2,804.8   $ 2,841.0   $ (99.3 ) $ 4,547.0   $ 385.9   $ 4,932.9  

Net earnings

                1,378.0         1,378.0     190.1     1,568.1  

Other comprehensive income

                                                 

Foreign currency translation adjustment—net of taxes

                    47.4     47.4     1.0     48.4  

Unrealized gain on securities—net of taxes

                    1.5     1.5         1.5  

Defined benefit plans—net of taxes

                    12.5     12.5         12.5  
                                             

Comprehensive income

                                  1,439.4     191.1     1,630.5  
                                             

Purchase of treasury stock

        (500.0 )                 (500.0 )       (500.0 )

Acquistion of treasury stock under employee stock plans

        (2.3 )               (2.3 )       (2.3 )

Retirement of treasury stock

    (0.1 )   1,500.2     (374.2 )   (1,125.9 )                  

Issuance of $0.01 par value common stock under employee stock plans

            12.6             12.6         12.6  

Stock-based compensation expense

            8.0             8.0         8.0  

Excess tax benefit from stock-based compensation

            30.0             30.0         30.0  

Cash dividends ($1.20 per share)

                (77.4 )         (77.4 )       (77.4 )

Declaration of distribution payable

                            (58.8 )   (58.8 )

Effect of exchange rates changes

                            2.6     2.6  
                                   

Balance at September 30, 2012

  $ 0.6   $ (2.3 ) $ 2,481.2   $ 3,015.7   $ (37.9 ) $ 5,457.3   $ 520.8   $ 5,978.1  
                                   

Balance at December 31, 2012

  $ 0.6   $ (2.3 ) $ 2,492.4   $ 3,461.1   $ (49.6 ) $ 5,902.2   $ 380.0   $ 6,282.2  

Net earnings

                1,138.8         1,138.8     52.6     1,191.4  

Other comprehensive income

                                                 

Foreign currency translation adjustment—net of taxes

                    (28.0 )   (28.0 )   (0.7 )   (28.7 )

Unrealized loss on hedging derivatives—net of taxes

                    (0.3 )   (0.3 )       (0.3 )

Unrealized gain on securities—net of taxes

                    0.3     0.3         0.3  

Defined benefit plans—net of taxes

                    5.0     5.0         5.0  
                                             

Comprehensive income

                                  1,115.8     51.9     1,167.7  
                                             

Acquisitions of noncontrolling interests in CFL

            (752.5 )           (752.5 )   (16.8 )   (769.3 )

Acquistion of treasury stock under employee stock plans

        (3.2 )               (3.2 )       (3.2 )

Purchases of treasury stock

        (1,111.5 )               (1,111.5 )       (1,111.5 )

Retirement of treasury stock

        750.1     (106.3 )   (643.8 )                  

Issuance of $0.01 par value common stock under employee stock plans

        5.2     4.7     (3.6 )       6.3         6.3  

Stock-based compensation expense

            9.3             9.3         9.3  

Excess tax benefit from stock-based compensation

            11.4             11.4         11.4  

Cash dividends ($1.20 per share)

                (71.9 )         (71.9 )       (71.9 )

Declaration of distribution payable

                            (59.1 )   (59.1 )

Effect of exchange rates changes

                            0.1     0.1  
                                   

Balance at September 30, 2013

  $ 0.6   $ (361.7 ) $ 1,659.0   $ 3,880.6   $ (72.6 ) $ 5,105.9   $ 356.1   $ 5,462.0  
                                   

   

See Accompanying Notes to Unaudited Consolidated Financial Statements.

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CF INDUSTRIES HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 
  Nine months ended
September 30,
 
 
  2013   2012  
 
  (in millions)
 

Operating Activities:

             

Net earnings

  $ 1,191.4   $ 1,568.1  

Adjustments to reconcile net earnings to net cash provided by operating activities:

             

Depreciation, depletion and amortization

    313.8     318.7  

Deferred income taxes

    35.8     32.8  

Stock compensation expense

    9.5     8.8  

Excess tax benefit from stock-based compensation

    (11.4 )   (30.0 )

Unrealized gain on derivatives

    (4.0 )   (61.5 )

Loss on disposal of property, plant and equipment

    5.0     4.0  

Undistributed earnings of affiliates—net

    (12.9 )   (59.0 )

Changes in:

             

Accounts receivable

    44.6     (67.8 )

Margin deposits

        0.8  

Inventories

    (86.3 )   3.2  

Accrued income taxes

    (232.7 )   (200.1 )

Accounts payable and accrued expenses

    69.4     64.0  

Customer advances—net

    52.5     360.1  

Other—net

    54.6     12.2  
           

Net cash provided by operating activities

    1,429.3     1,954.3  
           

Investing Activities:

             

Additions to property, plant and equipment

    (632.9 )   (261.4 )

Proceeds from the sale of property, plant and equipment

    11.1     11.6  

Sales and maturities of short-term and auction rate securities

    6.6     31.0  

Deposits to restricted cash funds

    (111.4 )    

Deposits to asset retirement obligation funds

        (2.2 )

Other—net

    (4.3 )    
           

Net cash used in investing activities

    (730.9 )   (221.0 )
           

Financing Activities:

             

Proceeds from long-term borrowings

    1,498.0      

Payments of long-term debt

        (13.0 )

Advances from unconsolidated affiliates

        40.5  

Financing fees

    (14.5 )    

Dividends paid on common stock

    (71.9 )   (77.4 )

Distributions to noncontrolling interests

    (64.4 )   (212.8 )

Purchase of treasury stock

    (1,111.5 )   (500.0 )

Acquisitions of noncontrolling interests in CFL

    (918.7 )    

Issuances of common stock under employee stock plans

    6.3     12.6  

Excess tax benefit from stock-based compensation

    11.4     30.0  
           

Net cash used in financing activities

    (665.3 )   (720.1 )
           

Effect of exchange rate changes on cash and cash equivalents

    (21.8 )   1.1  
           

Increase in cash and cash equivalents

    11.3     1,014.3  

Cash and cash equivalents at beginning of period

    2,274.9     1,207.0  
           

Cash and cash equivalents at end of period

  $ 2,286.2   $ 2,221.3  
           

   

See Accompanying Notes to Unaudited Consolidated Financial Statements.

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CF INDUSTRIES HOLDINGS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1.     Background and Basis of Presentation

        We are one of the largest manufacturers and distributors of nitrogen and phosphate fertilizer products in the world. Our operations are organized into two business segments—the nitrogen segment and the phosphate segment. Our principal customers are cooperatives and independent fertilizer distributors. Our principal fertilizer products in the nitrogen segment are ammonia, granular urea, urea ammonium nitrate solution, or UAN, and ammonium nitrate, or AN. Our other nitrogen products include urea liquor, diesel exhaust fluid, or DEF, and aqua ammonia, which are sold primarily to our industrial customers. Our principal fertilizer products in the phosphate segment are diammonium phosphate, or DAP, and monoammonium phosphate, or MAP.

        Our core market and distribution facilities are concentrated in the midwestern United States and other major agricultural areas of the U.S. and Canada. We also export nitrogen fertilizer products from our Donaldsonville, Louisiana manufacturing facilities and phosphate fertilizer products from our Florida phosphate operations.

        On October 28, 2013, we announced that we had entered into a set of strategic agreements with The Mosaic Company (Mosaic) to sell our phosphate mining and manufacturing business and additional long-term supply agreements to provide ammonia to Mosaic. Further information regarding these agreements is contained in Note 21—Subsequent Events.

        The accompanying unaudited interim consolidated financial statements have been prepared on the same basis as our audited consolidated financial statements for the year ended December 31, 2012, in accordance with accounting principles generally accepted in the United States for interim financial reporting. In the opinion of management, these statements reflect all adjustments, consisting only of normal and recurring adjustments that are necessary for the fair representation of the information for the periods presented. The unaudited interim consolidated financial statements included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. Operating results for any period presented apply to that period only and are not necessarily indicative of results for any future period.

        These statements should be read in conjunction with our audited consolidated financial statements and related disclosures included in our 2012 Annual Report on Form 10-K filed with the SEC on February 27, 2013.

        The preparation of the unaudited interim financial statements requires management to make use of estimates and assumptions that affect the reported amount of assets and liabilities, revenue and expenses and certain financial statement disclosures. Actual results could differ from these estimates. Significant estimates in these consolidated financial statements include net realizable value of inventories, the timing and ultimate settlement costs of asset retirement obligations, environmental remediation liabilities, environmental and litigation contingencies, the cost of sales incentives, useful lives of property and identifiable intangible assets, the evaluation of impairments of property, investments, identifiable intangible assets and goodwill, income tax and valuation reserves, allowances for doubtful accounts receivable, the measurement of the fair values of investments for which markets are not active, assumptions used in the determination of the funded status and annual expense of pension and postretirement employee benefit plans and the volatility and expected lives for stock compensation instruments granted to employees.

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CF INDUSTRIES HOLDINGS, INC.

        All references to "CF Holdings," "the Company," "we," "us" and "our" refer to CF Industries Holdings, Inc. and its subsidiaries, except where the context makes clear that the reference is only to CF Industries Holdings, Inc. itself and not its subsidiaries.

2.     Summary of Significant Accounting Policies

        For a complete discussion of the Company's significant accounting policies, refer to our 2012 Annual Report on Form 10-K filed with the SEC on February 27, 2013.

3.     New Accounting Standards

        Following are summaries of accounting pronouncements that either were adopted recently or may become applicable to our consolidated financial statements. It should be noted that the accounting standards references provided below reflect the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC), and related Accounting Standards Updates (ASU).

Recently Adopted Pronouncements

        In December 2011, the FASB issued a standard pertaining to disclosures about offsetting assets and liabilities (ASU No. 2011-11). This standard requires an entity to disclose information about offsetting and related arrangements, including financial instruments and derivative instruments, and the effect these arrangements have on the entity's financial position. In January 2013, the FASB issued an amendment to ASU No. 2011-11 (ASU No. 2013-01) clarifying that its scope applies to derivatives, repurchase agreements and reverse repurchase agreements, and securities borrowing and securities lending transactions that are either offset or subject to an enforceable master netting arrangement or similar agreement. These standards are effective for disclosures in interim and annual reporting periods beginning on or after January 1, 2013. We adopted this standard in the first quarter of 2013 and its adoption did not have a material impact on our consolidated financial statements.

        In February 2013, the FASB issued a standard pertaining to the reporting of amounts reclassified out of accumulated other comprehensive income (AOCI) (ASU No. 2013-02). The standard requires that an entity provide, by component, information regarding the amounts reclassified out of AOCI, either on the face of the statement of operations or in the notes, and an indication as to the line items in the statement of operations that the amounts were reclassified to. In addition, in certain cases, an entity is required to cross-reference to other disclosures that provide additional details about the reclassified amounts. This standard is effective prospectively for reporting periods beginning after December 15, 2012. We adopted this standard in the first quarter of 2013 and its adoption did not have a material impact on our consolidated financial statements.

4.     Noncontrolling Interests

Canadian Fertilizers Limited (CFL)

        CFL owns a nitrogen fertilizer complex in Medicine Hat, Alberta, Canada, which until April 30, 2013, supplied fertilizer products to CF Industries, Inc. (CF Industries) and Viterra Inc. (Viterra). The Medicine Hat complex is the largest nitrogen fertilizer complex in Canada, with two world-scale ammonia plants, a world-scale granular urea plant and on-site storage facilities for both ammonia and urea.

        Prior to April 30, 2013, CF Industries owned 49% of the voting common shares and 66% of the non-voting preferred shares of CFL and purchased 66% of the production of CFL. Also prior to April 30, 2013, Viterra, Inc. (Viterra) held 34% of the equity ownership of CFL, and had the right to

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CF INDUSTRIES HOLDINGS, INC.

purchase up to the remaining 34% of CFL's production. Both CF Industries and Viterra were entitled to receive distributions of net earnings of CFL based upon their respective purchases from CFL. The remaining 17% of the voting common shares were owned by GROWMARK, Inc. and La Coop fédérée. CFL was a variable interest entity that was consolidated in the Company's financial statements.

        In 2012, the Company entered into agreements to acquire the noncontrolling interests in CFL for C$0.9 billion, which included 34% of CFL's common and preferred shares owned by Viterra, the product purchase agreement between CFL and Viterra and the CFL common shares held by GROWMARK, Inc. and La Coop fédérée. In April 2013, we completed the acquisitions. Since CFL was previously a consolidated variable interest entity, the purchase price was recognized as follows: a $0.8 billion reduction in paid in capital; a $0.1 billion deferred tax asset; and the removal of the CFL noncontrolling interest. CFL is now a wholly owned subsidiary and we purchase 100% of CFL's ammonia and granular urea production.

        CF Industries' and Viterra's purchases of nitrogen fertilizer products from CFL were made under product purchase agreements, and the selling prices were determined under the provisions of these agreements. Prior to the fourth quarter of 2012 an initial selling price was paid to CFL based upon CFL's production cost plus an agreed-upon margin once title passed as the product was shipped. At the end of the year, the difference between the market price of products purchased from CFL and the price based on production cost plus the agreed-upon margin was paid to CFL. The sales revenue attributable to this difference was accrued by the Company on an interim basis.

        In the fourth quarter of 2012, the CFL Board of Directors approved amendments to the product purchase agreements retroactive to January 1, 2012 that modified the selling prices that CFL charged for products sold to Viterra and CF Industries to eliminate the requirement to pay to CFL the difference between the market price and the price based on production cost plus an agreed- upon margin. The effect of the selling price amendments to the product purchase agreements impacts the comparability of the Company's financial results. These changes impact the year-over-year comparability of net sales, gross margin, operating earnings, earnings before income taxes and net earnings attributable to noncontrolling interest for the first four months of 2013, but do not impact the comparability of the Company's net earnings attributable to common stockholders or net cash flows for the same period.

        At September 30, 2013 and December 31, 2012, the net receivables due from Viterra related to the product purchases that were reflected on our consolidated balance sheets were zero and $2.0 million, respectively. The net earnings attributable to Viterra that are reported on the consolidated balance sheets in the line titled distributions payable to noncontrolling interest at September 30, 2013 and December 31, 2012 were zero and $5.3 million, respectively.

Terra Nitrogen Company, L.P. (TNCLP)

        TNCLP is a master limited partnership that owns a nitrogen manufacturing facility in Verdigris, Oklahoma. We own an aggregate 75.3% of TNCLP through general and limited partnership interests. Outside investors own the remaining 24.7% of the limited partnership. For financial reporting purposes, the assets, liabilities and earnings of the partnership are consolidated into our financial statements. The outside investors' limited partnership interests in the partnership have been recorded as part of noncontrolling interest in our consolidated financial statements. The noncontrolling interest represents the noncontrolling unitholders' interest in the equity of TNCLP. An affiliate of CF Industries is required to purchase all of TNCLP's fertilizer products at market prices as defined in the Amendment to the General and Administrative Services and Product Offtake Agreement, dated September 28, 2010.

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        TNCLP makes cash distributions to the general and limited partners based on formulas defined within its Agreement of Limited Partnership. Cash available for distribution is defined in the agreement generally as all cash receipts less all cash disbursements, less certain reserves (including reserves for future operating and capital needs) established as the general partner determines in its reasonable discretion to be necessary or appropriate. Changes in working capital impact available cash, as increases in the amount of cash invested in working capital items (such as accounts receivable or inventory) reduce available cash, while declines in the amount of cash invested in working capital increase available cash. Cash distributions to the limited partners and general partner vary depending on the extent to which the cumulative distributions exceed certain target threshold levels set forth in the Agreement of Limited Partnership.

        In each of the applicable quarters of 2013 and 2012, the minimum quarterly distributions were satisfied, which entitled us, as the general partner, to receive increased distributions on our general partner interests as provided for in the Agreement of Limited Partnership. The earnings attributed to our general partner interest in excess of the threshold levels for the nine months ended September 30, 2013 and 2012, were $158.3 million and $172.3 million, respectively.

        At September 30, 2013, Terra Nitrogen GP Inc. (TNGP), the general partner of TNCLP (and an indirect wholly-owned subsidiary of CF Industries), and its affiliates owned 75.3% of TNCLP's outstanding units. When not more than 25% of TNCLP's issued and outstanding units are held by non-affiliates of TNGP, TNCLP, at TNGP's sole discretion, may call, or assign to TNGP or its affiliates, TNCLP's right to acquire all such outstanding units held by non-affiliated persons. If TNGP elects to acquire all outstanding units, TNCLP is required to give at least 30 but not more than 60 days notice of TNCLP's decision to purchase the outstanding units. The purchase price per unit will be the greater of (1) the average of the previous 20 trading days' closing prices as of the date five days before the purchase is announced or (2) the highest price paid by TNGP or any of its affiliates for any unit within the 90 days preceding the date the purchase is announced.

        A reconciliation of the beginning and ending balances of noncontrolling interest and distributions payable to noncontrolling interests on our consolidated balance sheets is provided below.

 
  Nine months ended September 30,  
 
  2013   2012  
 
  CFL   TNCLP   Total   CFL   TNCLP   Total  
 
  (in millions)
 

Noncontrolling interest:

                                     

Beginning balance

  $ 17.4   $ 362.6   $ 380.0   $ 16.7   $ 369.2   $ 385.9  

Earnings attributable to noncontrolling interest

    2.3     50.3     52.6     137.6     52.5     190.1  

Declaration of distributions payable

    (2.3 )   (56.8 )   (59.1 )       (58.8 )   (58.8 )

Acquistions of noncontrolling interests in CFL

    (16.8 )       (16.8 )            

Effect of exchange rate changes

    (0.6 )       (0.6 )   3.6         3.6  
                           

Ending balance

  $   $ 356.1   $ 356.1   $ 157.9   $ 362.9   $ 520.8  
                           

Distributions payable to noncontrolling interest:

                                     

Beginning balance

  $ 5.3   $   $ 5.3   $ 149.7   $   $ 149.7  

Declaration of distributions payable

    2.3     56.8     59.1         58.8     58.8  

Distributions to noncontrolling interest

    (7.5 )   (56.8 )   (64.3 )   (154.0 )   (58.8 )   (212.8 )

Effect of exchange rate changes

    (0.1 )       (0.1 )   4.3         4.3  
                           

Ending balance

  $   $   $   $   $   $  
                           

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5.     Fair Value Measurements

        Our cash and cash equivalents and other investments consist of the following:

 
  September 30, 2013  
 
  Adjusted
Cost
  Unrealized
Gains
  Unrealized
Losses
  Fair Value  
 
  (in millions)
 

Cash

  $ 79.8   $   $   $ 79.8  

U.S. and Canadian government obligations

    2,157.1             2,157.1  

Other debt securities

    49.3             49.3  
                   

Total cash and cash equivalents

  $ 2,286.2   $   $   $ 2,286.2  

Restricted cash

    111.4             111.4  

Asset retirement obligation funds

    200.8             200.8  

 

 
  December 31, 2012  
 
  Adjusted
Cost
  Unrealized
Gains
  Unrealized
Losses
  Fair Value  
 
  (in millions)
 

Cash

  $ 106.0   $   $   $ 106.0  

U.S. and Canadian government obligations

    1,996.9             1,996.9  

Other debt securities

    172.0             172.0  
                   

Total cash and cash equivalents

  $ 2,274.9   $   $   $ 2,274.9  

Investments in auction rate securities

    27.3         (1.3 )   26.0  

Asset retirement obligation funds

    200.8             200.8  

Nonqualified employee benefit trusts

    21.2     0.8         22.0  

        Under our short-term investment policy, we may invest our cash balances, either directly or through mutual funds, in several types of investment-grade securities, including notes and bonds issued by governmental entities or corporations. Securities issued by governmental entities include those issued directly by the Federal government; those issued by state, local or other governmental entities; and those guaranteed by entities affiliated with governmental entities.

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Assets and Liabilities Measured at Fair Value on a Recurring Basis

        The following tables present assets and liabilities included in our consolidated balance sheets at September 30, 2013 and December 31, 2012 that are recognized at fair value on a recurring basis, and indicates the fair value hierarchy utilized to determine such fair value:

 
  September 30, 2013  
 
  Total Fair
Value
  Quoted Prices
in Active
Markets
(Level 1)
  Significant
Other
Observable
Inputs
(Level 2)
  Significant
Unobservable
Inputs
(Level 3)
 
 
  (in millions)
 

Cash and cash equivalents

  $ 2,286.2   $ 2,286.2   $   $  

Restricted cash

    111.4     111.4          

Unrealized gains on derivative instruments

    24.2         24.2      

Asset retirement obligation funds

    200.8     200.8          
                   

Total assets at fair value

  $ 2,622.6   $ 2,598.4   $ 24.2   $  
                   

Unrealized losses on derivative instruments

  $ 9.0   $   $ 9.0   $  
                   

Total liabilities at fair value

  $ 9.0   $   $ 9.0   $  
                   

 

 
  December 31, 2012  
 
  Total Fair
Value
  Quoted Prices
in Active
Markets
(Level 1)
  Significant
Other
Observable
Inputs
(Level 2)
  Significant
Unobservable
Inputs
(Level 3)
 
 
  (in millions)
 

Cash and cash equivalents

  $ 2,274.9   $ 2,274.9   $   $  

Unrealized gains on derivative instruments

    17.3         17.3      

Asset retirement obligation funds

    200.8     200.8          

Investments in auction rate securities

    26.0             26.0  

Nonqualified employee benefit trusts

    22.0     22.0          
                   

Total assets at fair value

  $ 2,541.0   $ 2,497.7   $ 17.3   $ 26.0  
                   

Unrealized losses on derivative instruments

  $ 5.6   $   $ 5.6   $  
                   

Total liabilities at fair value

  $ 5.6   $   $ 5.6   $  
                   

        Following is a summary of the valuation methodologies for assets and liabilities recorded on our consolidated balance sheets at fair value on a recurring basis:

Cash and Cash Equivalents

        At September 30, 2013 and December 31, 2012, our cash and cash equivalents consisted primarily of U.S. and Canadian government obligations and money market mutual funds that invest in U.S. government obligations and other investment-grade securities.

Restricted Cash

        We have contracted for engineering and procurement services with an affiliate of ThyssenKrupp Uhde (Uhde) for our capacity expansion projects at our Donaldsonville, Louisiana and Port Neal, Iowa production facilities. Under the terms of the engineering and procurement services contract, we are

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required to grant Uhde a security interest in a restricted cash account and maintain a cash balance in that account equal to the cancellation fees for procurement services and equipment that would arise if we were to cancel the projects. We began funding the restricted account in the second quarter of 2013. The balance in the account is expected to change over time based on the amounts of unpaid engineering and procurement costs.

Derivative Instruments

        The derivative instruments that we use are primarily natural gas call options, fixed price swaps, and foreign currency forward contracts traded in the over-the-counter markets with either large oil and gas companies or large financial institutions. The natural gas derivatives are traded in months forward and settlements are scheduled to coincide with anticipated gas purchases during those future periods. The foreign currency derivative contracts held are for the exchange of a specified notional amount of currencies at specified future dates coinciding with anticipated foreign currency cash outflows associated with our Donaldsonville, LA and Port Neal, IA capital expansion projects. The natural gas derivative contracts settle using NYMEX futures prices. To determine the fair value of these instruments, we use quoted market prices from NYMEX and standard pricing models with inputs derived from or corroborated by observable market data such as forward curves supplied by an industry recognized unrelated third party. The currency derivatives are valued based on quoted market prices supplied by an industry recognized, unrelated third party. See Note 15—Derivative Financial Instruments, for additional information.

Asset Retirement Obligation Funds

        In order to meet financial assurance requirements associated with certain Asset Retirement Obligations (AROs) in Florida, we maintain investments in an escrow account established for the benefit of the Florida Department of Environmental Protection (FDEP) and a trust established to comply with a 2010 Consent Decree with the U.S. Environmental Protection Agency (EPA) and the FDEP. The investments in the trust and escrow account are accounted for as available-for-sale securities. The fair values of these investments are based upon daily quoted prices representing the Net Asset Value (NAV) of the investments. See Note 7—Asset Retirement Obligations, for additional information regarding the trust and escrow accounts. The fair values of the ARO funds approximate their cost basis.

Investments in Auction Rate Securities

        Our investments in Auction Rate Securities (ARS) are accounted for as available-for-sale securities and are included on our consolidated balance sheets in other assets. At September 30, 2013, our ARS are not material to our consolidated balance sheet.

Nonqualified Employee Benefit Trusts

        We maintain trusts associated with certain deferred compensation related to nonqualified employee benefits. The investments are accounted for as available-for-sale securities. The fair values of the trusts are based on daily quoted prices representing the NAV of the investments. These trusts are included on our consolidated balance sheets in other assets. At September 30, 2013, our nonqualified employee benefit trusts are not material to our consolidated balance sheet.

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6.     Net Earnings Per Share

        Net earnings per share were computed as follows:

 
  Three months ended
September 30,
  Nine months ended
September 30,
 
 
  2013   2012   2013   2012  
 
  (in millions, except per share amounts)
 

Net earnings attributable to common stockholders

  $ 234.1   $ 403.3   $ 1,138.8   $ 1,378.0  
                   

Basic earnings per common share:

                         

Weighted average common shares outstanding

    57.3     62.8     59.6     64.2  
                   

Net earnings attributable to common stockholders          

  $ 4.09   $ 6.43   $ 19.12   $ 21.47  
                   

Diluted earnings per common share:

                         

Weighted average common shares outstanding

    57.3     62.8     59.6     64.2  

Dilutive common shares—stock options

    0.2     0.7     0.3     0.8  
                   

Diluted weighted average shares outstanding

    57.5     63.5     59.9     65.0  
                   

Net earnings attributable to common stockholders          

  $ 4.07   $ 6.35   $ 19.01   $ 21.19  
                   

        In the computation of diluted net earnings per common share, potentially dilutive stock options are excluded if the effect of their inclusion is anti-dilutive. For the three and nine months ended September 30, 2013 and 2012, anti-dilutive stock options were insignificant.

7.     Asset Retirement Obligations

        Asset retirement obligations (AROs) are legal obligations associated with the retirement of long-lived assets that result from the acquisition, construction, development or normal operation of such assets. Our AROs are primarily associated with phosphogypsum stack systems and mine reclamation in Florida.

        The changes in our AROs from December 31, 2012 to September 30, 2013 are summarized below:

 
  (in millions)  

Obligation at December 31, 2012

  $ 145.0  

Accretion expense

    7.8  

Liabilities incurred

    1.1  

Expenditures

    (3.6 )

Changes in estimate

    7.8  
       

Obligation at September 30, 2013

  $ 158.1  
       

        Our phosphate operations in Florida are subject to regulations governing the construction, operation, closure and long-term maintenance of phosphogypsum stack systems and regulations concerning site reclamation for phosphate rock mines. Our liability for phosphogypsum stack system costs includes the cost of stack closure at Plant City and the costs of cooling pond closure, post-closure monitoring, and ongoing water treatment at both Bartow and Plant City. The actual amounts to be spent will depend on factors such as the timing of activities, refinements in scope, technological developments, cost inflation and changes in regulations. It is possible that these factors could change at any time and impact the estimates. Closure expenditures for the Bartow cooling pond are estimated to occur through 2016. Closure expenditures for the Plant City stack expansion are estimated to occur in

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the 2033 to 2037 time frame and closure of the Plant City cooling pond is assumed to occur in the year 2087. Additional AROs may be incurred in the future.

        The $7.8 million change in estimate in 2013 relates primarily to changes in mining and reclamation plans in the third quarter at our Hardee County, Florida phosphate rock mine. Of this amount, $7.5 million was recorded as an increase in property, plant and equipment and $0.3 million was charged to cost of sales.

        AROs are reported in accrued expenses and other noncurrent liabilities on our consolidated balance sheets, as follows:

 
  September 30,
2013
  December 31,
2012
 
 
  (in millions)
 

Current portion

  $ 9.4   $ 12.3  

Noncurrent portion

    148.7     132.7  
           

  $ 158.1   $ 145.0  
           

        In addition to various operational and environmental regulations related to our phosphate segment, we are also subject to financial assurance obligations related to the closure and maintenance of our phosphogypsum stack systems at both our Plant City, Florida phosphate fertilizer complex and our closed Bartow, Florida phosphate fertilizer complex. These financial assurance obligations result from two requirements. The first is a 2010 consent decree with the EPA and the FDEP with respect to our compliance with the Resource Conservation and Recovery Act (RCRA) at our Plant City complex (the Plant City Consent Decree). The second is State of Florida financial assurance regulations (Florida Financial Assurance) that apply to both our Plant City and Bartow complexes. Both of these regulations allow the use of a funding mechanism as a means of complying with the financial assurance requirements associated with the closure, long-term maintenance, and monitoring costs for the phosphogypsum stacks, as well as costs incurred to manage the water contained in the stack system upon closure. We maintain a trust account for the benefit of the EPA and FDEP and an escrow account for the benefit of the FDEP to meet these financial assurance requirements. On our consolidated balance sheets, these are collectively referred to as "Asset retirement obligation funds" (ARO funds). The trust for the Plant City Consent Decree is fully funded, and we expect to fund the remaining approximately $4.0 million in the State of Florida Financial Assurance escrow account near the end of 2015. Both financial assurance funding obligations require estimates of future expenditures that could be impacted by refinements in scope, technological developments, cost inflation, changes in regulations, discount rates and the timing of activities. Additional funding would be required in the future if increases in cost estimates exceed investment earnings in the trust or escrow accounts. At both September 30, 2013 and December 31, 2012, the balance in the ARO funds was $200.8 million.

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8.     Interest Expense

        Details of interest expense are as follows:

 
  Three months ended
September 30,
  Nine months ended
September 30,
 
 
  2013   2012   2013   2012  
 
  (in millions)
 

Interest on borrowings

  $ 43.8   $ 28.0   $ 106.8   $ 84.1  

Fees on financing agreements

    3.9     3.3     11.4     28.4  

Interest on tax liabilities

    0.5         12.2     1.0  

Interest capitalized and other

    (7.2 )   (2.6 )   (18.0 )   (8.6 )
                   

  $ 41.0   $ 28.7   $ 112.4   $ 104.9  
                   

9.     Income Taxes

        Our income tax provision for the three months ended September 30, 2013 was $109.0 million on pre-tax income of $345.7 million, or an effective tax rate of 31.5%, compared to an income tax provision of $206.0 million, or an effective tax rate of 32.2% for the three months ended September 30, 2012. Our effective tax rate is lower for the three months ended September 30, 2013 primarily due to a change in the method of calculating percentage depletion for income tax purposes. This is partially offset by the tax impact arising from the acquisition of the noncontrolling interests in CFL.

        Our effective tax rate based on pre-tax earnings differs from our effective tax rate based on pre-tax income exclusive of noncontrolling interest, as our consolidated income tax provision does not include a tax provision on the earnings attributable to controlling interests in TNCLP, which does not record an income tax provision.

        At the time of our Initial Public Offering (IPO) in 2005, we had accumulated a substantial amount of NOLs. Due to the uncertainty of realizing the tax benefit from the NOLs when we ceased to be a non-exempt cooperative for income tax purposes when we became a public company, a full valuation allowance was recorded against those NOLs. At that time, we entered into an agreement (NOL Agreement) with the pre-IPO owners under which they would benefit should any of the pre-IPO NOLs be realized in future years by our using the NOLs to offset post-IPO taxable income. If this were to occur, we would pay the pre-IPO owners amounts equal to the resulting federal and state income taxes actually saved. At December 31, 2012, the NOLs had a potential tax benefit of $94.3 million, which had been fully reserved by the valuation allowance. In January 2013, we and the pre-IPO owners amended the NOL Agreement to provide, among other things, that we would be entitled to retain 26.9% of any settlement realized.

        In March 2013, we entered into a Closing Agreement with the IRS to resolve the tax treatment of the pre-IPO NOLs. Pursuant to the Closing Agreement, we have agreed with the IRS that we will be entitled to a tax deduction equal to a portion of the NOLs over five years commencing with the 2012 tax year. Under the terms of the amended NOL Agreement, 73.1% of the federal and state tax savings will be payable to our pre-IPO owners. As a result of the Closing Agreement, we recorded a liability of $55.2 million to recognize the tax savings from the IRS settlement that will be payable to our pre-IPO owners under the terms of the NOL Agreement. In our consolidated statement of operations for the nine months ended September 30, 2013, the expense related to this liability is included in Other non-operating—net. On our consolidated balance sheet at September 30, 2013, $13.5 million is included in accounts payable and accrued expenses for the current portion of the tax savings payable to the pre-IPO owners and $41.7 million is included in other noncurrent liabilities for the portion of the tax savings payable to the pre-IPO owners in future years. In our consolidated statement of cash flows for the nine months ended September 30, 2013, these amounts are included in accounts payable and accrued expenses, and other-net, respectively.

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        The tax effect of the IRS settlement noted above includes an $86.8 million reduction to our unrecognized tax benefits previously recorded for the disallowed refund claims based on utilization of the pre-IPO NOLs.

        Our effective tax rate may be affected if our unrecognized tax benefits of $75.3 million at September 30, 2013 were to be recognized in the future.

        For additional information concerning income taxes, see Note 11—Income Taxes in our 2012 Annual Report on Form 10-K filed with the SEC on February 27, 2013.

10.   Inventories—Net

        Inventories—net consist of the following:

 
  September 30,
2013
  December 31
2012
 
 
  (in millions)
 

Fertilizer

  $ 289.0   $ 212.2  

Raw materials, spare parts and supplies

    68.4     65.7  
           

  $ 357.4   $ 277.9  
           

11.   Equity Method Investments

        Equity method investments consist of the following:

 
  September 30,
2013
  December 31,
2012
 
 
  (in millions)
 

Operating equity method investments

  $ 388.7   $ 394.2  

Non-operating equity method investments

    543.1     541.4  
           

Investments in and advances to affiliates

  $ 931.8   $ 935.6  
           

Operating Equity Method Investments

        Our equity method investments included in operating earnings consist of: (1) a 50% ownership interest in Point Lisas Nitrogen Limited (PLNL), which operates an ammonia production facility in the Republic of Trinidad and Tobago; and (2) a 50% interest in an ammonia storage joint venture located in Houston, Texas. We include our share of the net earnings from these investments as an element of earnings from operations because these operations provide additional production and storage capacity to our operations and are integrated with our other supply chain and sales activities in the nitrogen segment.

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        The combined results of operations and financial position for our operating equity method investments are summarized below:

 
  Three months ended
September 30,
  Nine months ended
September 30,
 
 
  2013   2012   2013   2012  
 
  (in millions)
 

Condensed statement of operations information:

                         

Net sales

  $ 76.1   $ 67.8   $ 247.7   $ 249.0  
                   

Net earnings

  $ 24.4   $ 20.5   $ 80.3   $ 83.0  
                   

Equity in earnings of operating affiliates

  $ 11.2   $ 10.2   $ 32.3   $ 39.5  
                   

 

 
  September 30,
2013
  December 31,
2012
 
 
  (in millions)
 

Condensed balance sheet information:

             

Current assets

  $ 93.5   $ 93.9  

Long-term assets

    152.9     164.8  
           

Total assets

  $ 246.4   $ 258.7  
           

Current liabilities

  $ 36.8   $ 45.9  

Long-term liabilities

    26.0     26.0  

Equity

    183.6     186.8  
           

Total liabilities and equity

  $ 246.4   $ 258.7  
           

        The total carrying value of these investments at September 30, 2013 was $388.7 million, which was $296.9 million more than our share of the affiliates' book value. The excess is primarily attributable to the purchase accounting impact of our acquisition of the investment in PLNL and reflects primarily the revaluation of property, plant and equipment, the value of an exclusive natural gas contract and goodwill. The increased basis for property, plant and equipment and the gas contract are being depreciated over a remaining period of approximately 20 years and 10 years, respectively. Our equity in earnings of operating affiliates is different from our ownership interest in income reported by the unconsolidated affiliates due to amortization of basis differences.

        We have transactions in the normal course of business with PLNL reflecting our obligation to purchase 50% of the ammonia produced by PLNL at current market prices. Our ammonia purchases from PLNL totaled approximately $35.3 million and $115.5 million for the three and nine months ended September 30, 2013, respectively, and $31.4 million and $113.5 million for the three and nine months ended September 30, 2012, respectively.

Non-Operating Equity Method Investments

        Our non-operating equity method investments consist of: (1) a 50% ownership of KEYTRADE AG (Keytrade), a fertilizer trading company headquartered near Zurich, Switzerland; and (2) a 50% ownership in GrowHow UK Limited (GrowHow), which operates nitrogen production facilities in the United Kingdom. We account for these investments as non-operating equity method investments, and do not include the net earnings of these investments in earnings from operations since these operations do not provide additional capacity to us, nor are these operations integrated within our supply chain.

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        The combined results of operations and financial position of our non- operating equity method investments are summarized below:

 
  Three months ended
September 30,
  Nine months ended
September 30,
 
 
  2013   2012   2013   2012  
 
  (in millions)
 

Condensed statement of operations information:

                         

Net sales

  $ 640.9   $ 685.6   $ 1,947.5   $ 2,182.6  
                   

Net earnings

  $ 20.9   $ 54.2   $ 31.2   $ 116.9  
                   

Equity in earnings of non-operating affiliates—net of taxes

  $ 7.2   $ 23.9   $ 6.2   $ 48.8  
                   

 

 
  September 30,
2013
  December 31,
2012
 
 
  (in millions)
 

Condensed balance sheet information:

             

Current assets

  $ 523.1   $ 595.0  

Long-term assets

    314.0     293.4  
           

Total assets

  $ 837.1   $ 888.4  
           

Current liabilities

  $ 313.5   $ 385.6  

Long-term liabilities

    142.8     147.3  

Equity

    380.8     355.5  
           

Total liabilities and equity

  $ 837.1   $ 888.4  
           

        In conjunction with our investment in Keytrade, we provided financing to Keytrade in exchange for subordinated notes that mature on September 30, 2017 and bear interest at LIBOR plus 1.00 percent. At September 30, 2013 and December 31, 2012, the amount of the outstanding advances to Keytrade on our consolidated balance sheets was $12.4 million. The carrying value of our advances to Keytrade approximates fair value.

        Excluding the advances to Keytrade, the carrying value of our non-operating equity method investments at September 30, 2013 was $530.7 million, which was $340.3 million more than our share of the affiliates' book value. The excess is primarily attributable to the impact of our acquisition of Terra and reflects primarily the revaluation of property, plant and equipment, identifiable intangibles and goodwill. The increased basis for property, plant and equipment and identifiable intangibles are being depreciated over remaining periods up to 12 years. Our equity in earnings of non-operating affiliates-net of taxes is different than our ownership interest in their net earnings due to the amortization of basis differences.

        At September 30, 2013, the amount of our consolidated retained earnings that represents our undistributed earnings of non-operating equity method investments is $22.0 million.

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12.   Plant Turnaround Costs

        Scheduled inspections, replacements and overhauls of plant machinery and equipment at our continuous process manufacturing facilities are referred to as plant turnarounds. The expenditures related to turnarounds are capitalized into property, plant and equipment when incurred. The following is a summary of plant turnaround activity:

 
  Nine months ended
September 30,
 
 
  2013   2012  
 
  (in millions)
 

Net capitalized turnaround costs:

             

Beginning balance

  $ 82.1   $ 54.8  

Additions

    74.8     29.2  

Depreciation

    (30.0 )   (22.1 )

Effect of exchange rate changes

    (0.1 )   0.4  
           

Ending balance

  $ 126.8   $ 62.3  
           

        Scheduled replacements and overhauls of plant machinery and equipment include the dismantling, repair or replacement and installation of various components including piping, valves, motors, turbines, pumps, compressors, heat exchangers and the replacement of catalysts when a full plant shutdown occurs. Scheduled inspections are also conducted during full plant shutdowns, including required safety inspections which entail the disassembly of various components such as steam boilers, pressure vessels and other equipment requiring safety certifications. Internal employee costs and overhead are not considered turnaround costs and are not capitalized.

13.   Goodwill and Other Intangible Assets

        The following table shows the carrying amount of goodwill by business segment at September 30, 2013 and December 31, 2012:

 
  Nitrogen   Phosphate   Total  
 
  (in millions)
 

Balance by segment

  $ 2,063.6   $ 0.9   $ 2,064.5  

        The identifiable intangibles and carrying values are shown below. The Company's intangible assets are presented in noncurrent other assets on our consolidated balance sheets.

 
  At September 30, 2013   At December 31, 2012  
 
  Gross
Carrying
Amount
  Accumulated
Amortization
  Net   Gross
Carrying
Amount
  Accumulated
Amortization
  Net  
 
   
   
  (in millions)
   
   
 

Intangible assets:

                                     

Customer Relationships

  $ 50.0   $ (9.7 ) $ 40.3   $ 50.0   $ (7.6 ) $ 42.4  

TerraCair Brand

    10.0     (3.5 )   6.5     10.0     (2.8 )   7.2  
                           

Total intangible assets

  $ 60.0   $ (13.2 ) $ 46.8   $ 60.0   $ (10.4 ) $ 49.6  
                           

        Amortization expense of our identifiable intangibles was $0.9 million for both the three months ended September 30, 2013 and 2012, respectively, and was $2.9 million for both the nine months ended September 30, 2013 and 2012, respectively.

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        Total estimated amortization expense for the remainder of 2013 and the five succeeding fiscal years is as follows:

 
  Estimated
Amortization
Expense
 
 
  (in millions)
 

Remainder of 2013

  $ 0.9  

2014

    3.8  

2015

    3.8  

2016

    3.8  

2017

    3.8  

2018

    3.8  
       

  $ 19.9  
       

14.   Financing Agreements

        Long-term debt consisted of the following:

 
  September 30,
2013
  December 31,
2012
 
 
  (in millions)
 

Unsecured senior notes:

             

6.875% due 2018

  $ 800.0   $ 800.0  

7.125% due 2020

    800.0     800.0  

3.450% due 2023

    749.3      

4.950% due 2043

    748.7      
           

  $ 3,098.0   $ 1,600.0  

Less: Current portion

         
           

Net long-term debt

  $ 3,098.0   $ 1,600.0  
           

Credit Agreement

        In the second quarter of 2012, CF Holdings, as a guarantor, and CF Industries, as borrower, entered into a $500 million senior unsecured credit agreement, dated May 1, 2012 (the Credit Agreement), which provided for a revolving credit facility of up to $500 million with a maturity of five years. On April 22, 2013, the Credit Agreement was amended and restated to increase the credit facility from $500 million to $1.0 billion and extend its maturity an additional year to May 1, 2018.

        Borrowings under the Credit Agreement bear interest at a variable rate based on an applicable margin over LIBOR or a base rate and may be used for working capital, capital expenditures, acquisitions, share repurchases and other general purposes. The Credit Agreement requires that the Company maintain a minimum interest coverage ratio and not exceed a maximum total leverage ratio, and includes other customary terms and conditions, including customary events of default and covenants.

        All obligations under the Credit Agreement are unsecured. Currently CF Holdings is the only guarantor of CF Industries' obligations under the Credit Agreement. Certain of CF Industries' material domestic subsidiaries would be required to become guarantors under the Credit Agreement if such

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subsidiary were to guarantee other debt of the Company or CF Industries in excess of $350 million. Currently, no such subsidiary guarantees any debt.

        At September 30, 2013, there was $995.1 million of available credit under the Credit Agreement (net of outstanding letters of credit), and there were no borrowings outstanding.

Senior Notes due 2018 and 2020

        On April 23, 2010, CF Industries issued $800 million aggregate principal amount of 6.875% senior notes due May 1, 2018 and $800 million aggregate principal amount of 7.125% senior notes due May 1, 2020 (the 2018/2020 Notes). Interest is paid semiannually on May 1 and November 1 and the 2018/2020 Notes are redeemable at our option, in whole at any time or in part from time to time, at specified make-whole redemption prices.

        The indentures governing the 2018/2020 Notes contain customary events of default and covenants that limit, among other things, the ability of the Company and its subsidiaries, including CF Industries, to incur liens on certain properties to secure debt. In the event of specified changes of control involving the Company or CF Industries, they also require CF Industries to offer to repurchase the 2018/2020 Notes at a price equal to 101% of the principal amount thereof, plus accrued and unpaid interest.

        Under the supplemental indentures governing the 2018/2020 Notes, the 2018/2020 Notes are guaranteed by CF Holdings. In addition, in the event that a subsidiary of the Company, other than CF Industries, becomes a borrower or a guarantor under the Credit Agreement (or any renewal, replacement or refinancing thereof), such subsidiary would be required to become a guarantor of the 2018/2020 Notes.

        At September 30, 2013, the carrying value of the 2018/2020 Notes was $1.6 billion and the fair value was approximately $1.9 billion.

Senior Notes due 2023 and 2043

        On May 23, 2013, CF Industries issued $750 million aggregate principal amount of 3.450% senior notes due June 1, 2023 and $750 million aggregate principal amount of 4.950% senior notes due June 1, 2043 (the 2023/2043 Notes). Interest is paid semiannually on June 1 and December 1 and the 2023/2043 Notes are redeemable at our option, in whole at any time or in part from time to time, at specified make-whole redemption prices. We received net proceeds from the issuance and sale of the 2023/2043 Notes, after deducting underwriting discounts and offering expenses, of approximately $1.48 billion. We intend to use the net proceeds from the offering to fund our capacity expansion projects and working capital and for other general corporate purposes, including share repurchases.

        The indentures governing the 2023/2043 Notes contain customary events of default and covenants that limit, among other things, the ability of the Company and its subsidiaries, including CF Industries, to incur liens on certain properties to secure debt. In the event of specified changes of control involving CF Holdings or CF Industries, they also require CF Industries to offer to repurchase the 2023/2043 Notes at a price equal to 101% of the principal amount thereof, plus accrued and unpaid interest.

        Under the supplemental indentures governing the 2023/2043 Notes, the 2023/2043 Notes are guaranteed by CF Holdings. In addition, in the event that a subsidiary of the Company, other than CF Industries, becomes a borrower or a guarantor under the Credit Agreement (or any renewal, replacement or refinancing thereof), such subsidiary would be required to become a guarantor of the 2023/2043 Notes, provided that such requirement will no longer apply following the repayment of both

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issues of the 2018/2020 Notes or the subsidiaries of the Company, other than CF Industries, otherwise become no longer subject to such a requirement to guarantee the 2018/2020 Notes.

        At September 30, 2013, the carrying value of the 2023/2043 Notes was $1.5 billion and the fair value was approximately $1.4 billion.

15.   Derivative Financial Instruments

        We use derivative financial instruments to reduce our exposure to changes in commodity prices and foreign currency exchange rates.

Commodity Price Risk Management

        Natural gas is the largest and most volatile component of the manufacturing cost for nitrogen-based fertilizers. We manage the risk of changes in gas prices primarily through the use of derivative financial instruments covering periods of generally less than 18 months. The derivatives that we use are primarily fixed price swaps and call options traded in the over-the-counter (OTC) markets. These natural gas derivatives settle using primarily a NYMEX futures price index, which represents the basis for fair value at any given time. The contracts are entered into with respect to gas to be consumed in the future and settlements are scheduled to coincide with anticipated purchases of natural gas used to manufacture nitrogen products during those future periods. We use natural gas derivatives as an economic hedge of gas price risk, but without the application of hedge accounting.

        As of September 30, 2013 and December 31, 2012, we had open natural gas derivative contracts for 66.7 million MMBtus and 58.9 million MMBtus, respectively. For the nine months ended September 30, 2013, we used derivatives to cover approximately 90% of our natural gas consumption.

Foreign Currency Exchange Rates

        In the fourth quarter of 2012, our Board of Directors authorized the expenditure of $3.8 billion to construct new ammonia and urea/UAN plants at our Donaldsonville, Louisiana complex and new ammonia and urea plants at our Port Neal, Iowa complex. A portion of the project costs are Euro-denominated. In order to manage our exposure to changes in the Euro to U.S. dollar currency exchange rates, we have hedged our projected Euro denominated payments through early 2015 using currency forward exchange contracts.

        At September 30, 2013, the notional amount of our open foreign currency derivatives was $727.8 million. Of this amount, $182.6 million, or approximately 25%, was designated as cash flow hedging instruments for accounting purposes while the remaining $545.2 million was not designated as hedging instruments for accounting purposes.

        No reclassification from AOCI to income occurred in the nine months ended September 30, 2013 or during 2012, and none is expected within the next twelve months. The AOCI related to our foreign currency derivatives is expected to be reclassified into income over the depreciable lives of the fixed assets associated with the capital expansion projects.

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        The effect of derivatives in our consolidated statements of operations for the three and nine months ended September 30, 2013 and 2012 is shown in the tables below:

 
  Gain (loss) recognized
in OCI
  Gain (loss) reclassified from AOCI into income  
 
  Three months ended
September 30,
   
  Three months ended
September 30,
 
Derivatives designated
as cash flow hedges
  2013   2012   Location   2013   2012  
 
  (in millions)
   
  (in millions)
 

Foreign exchange contracts

  $ 6.1   $   Other operating—net   $   $  
                       

 

 
   
   
  Gain (loss) recognized in income  
 
   
   
   
  Three months ended
September 30,
 
 
   
   
  Location   2013   2012  
 
   
   
   
  (in millions)
 

Foreign exchange contracts

  Other operating—net(1)   $ 1.3   $  
                           

 

 
   
   
  Gain (loss) recognized in income  
 
   
   
   
  Three months ended
September 30,
 
Derivatives not
   
   
  Location   2013   2012  
designated as hedges
   
   
 
 
   
   
   
  (in millions)
 

Natural gas derivatives

  Cost of sales   $ (5.6 ) $ 39.8  

Foreign exchange contracts

  Other operating—net     19.9      
                           

                  $ 14.3   $ 39.8  
                           

 

 
  Gain (loss) in income  
 
  Three months ended
September 30,
 
All Derivatives
  2013   2012  
 
  (in millions)
 

Unrealized gains (losses)

             

Derivatives not designated as hedges

  $ 14.3   $ 39.8  

Cash flow hedge ineffectiveness

    1.3      
           

Total unrealized gains (losses)

    15.6     39.8  

Realized gains (losses)

    (7.4 )   (31.7 )
           

Net derivative gains (losses)

  $ 8.2   $ 8.1  
           

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  Gain (loss) recognized
in OCI
  Gain (loss) reclassified from AOCI into income  
 
  Nine months ended
September 30,
   
  Nine months ended
September 30,
 
Derivatives designated
as cash flow hedges
  2013   2012   Location   2013   2012  
 
  (in millions)
   
  (in millions)
 

Foreign exchange contracts

  $ (0.4 ) $   Other operating—net   $   $  
                       

 

 
   
   
  Gain (loss) recognized in income  
 
   
   
   
  Nine months ended
September 30,
 
 
   
   
  Location   2013   2012  
 
   
   
   
  (in millions)
 

Foreign exchange contracts

  Other operating—net(1)   $ (0.8 ) $  
                           

 

 
   
   
  Gain (loss) recognized in income  
 
   
   
   
  Nine months ended September 30,  
Derivatives not
   
   
  Location   2013   2012  
designated as hedges
   
   
 
 
   
   
   
  (in millions)
 

Natural gas derivatives

  Cost of sales   $ (1.2 ) $ 61.5  

Foreign exchange contracts

  Other operating—net     12.0      
                           

                  $ 10.8   $ 61.5  
                           

 

 
  Gain (loss) in income  
 
  Nine months ended
September 30,
 
All Derivatives
  2013   2012  
 
  (in millions)
 

Unrealized gains (losses)

             

Derivatives not designated as hedges

  $ 10.8   $ 61.5  

Cash flow hedge ineffectiveness

    (0.8 )    
           

Total unrealized gains (losses)

    10.0     61.5  

Realized gains (losses)

    1.9     (134.1 )
           

Net derivative gains (losses)

  $ 11.9   $ (72.6 )
           

(1)
For derivatives designated as cash flow hedges, the amount reported as gain (loss) recognized in income represents the amount excluded from hedge effectiveness.

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        The fair values of derivatives on our consolidated balance sheets are shown below. For additional information on derivative fair values, see Note 5—Fair Value Measurements.

 
  Asset Derivatives   Liability Derivatives  
 
  Balance Sheet
Location
  September 30,
2013
  December 31,
2012
  Balance Sheet
Location
  September 30,
2013
  December 31,
2012
 
 
   
  (in millions)
   
  (in millions)
 

Derivatives designated as hedging instruments

                                 

Foreign exchange contracts

  Other current assets   $ 6.3   $ 4.2   Other current liabilities   $   $  

Foreign exchange contracts

  Other noncurrent assets     0.7     4.8   Other noncurrent liabilities          
                           

      $ 7.0   $ 9.0       $   $  
                           

Derivatives not designated as hedging instruments

                                 

Foreign exchange contracts

  Other current assets   $ 13.3   $ 3.9   Other current liabilities   $   $  

Foreign exchange contracts

  Other noncurrent assets     3.9     2.4   Other non current liabilities          

Natural gas derivatives

  Other current assets         2.0   Other current liabilities     9.0     5.5  

Natural gas derivatives

  Other noncurrent assets           Other non current liabilities         0.1  
                           

      $ 17.2   $ 8.3       $ 9.0   $ 5.6  
                           

Total derivatives

      $ 24.2   $ 17.3       $ 9.0   $ 5.6  
                           

Current / Non-Current Totals

                                 

  Other current assets   $ 19.6   $ 10.1   Other current liabilities   $ 9.0   $ 5.5  

  Other noncurrent assets     4.6     7.2   Other non current liabilities         0.1  
                           

Total derivatives

      $ 24.2   $ 17.3       $ 9.0   $ 5.6  
                           

        The counterparties to our derivative contracts are large financial institutions and large oil and gas companies. Our derivatives are executed with several counterparties, generally under International Swaps and Derivatives Association (ISDA) agreements. The ISDA agreements are master netting arrangements commonly used for OTC derivatives that mitigate exposure to counterparty credit risk, in part, by creating contractual rights of netting and setoff, the specifics of which vary from agreement to agreement. These rights are described further below:

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        Most of our ISDA agreements contain credit-risk-related contingent features with sliding-scale credit support thresholds that are dependent upon the ratings assigned to our long-term unsecured debt by certain credit rating agencies. Downgrades in our credit ratings would cause the applicable threshold levels to decrease and improvements in those ratings could cause the threshold levels to increase. If our net liability positions exceed the threshold amounts, the counterparties could require cash collateral, some other form of credit support, or daily cash settlement of unrealized losses. At September 30, 2013 and December 31, 2012, the aggregate fair value of the derivative instruments with credit-risk-related contingent features in net liability positions was $3.8 million and $0.9 million, respectively, which also approximates the fair value of the maximum amount of additional collateral that would need to be posted or assets needed to settle the obligations if the credit-risk-related contingent features were triggered at the reporting dates. At both September 30, 2013 and December 31, 2012, we had no cash collateral on deposit with counterparties for derivative contracts. The credit support documents executed in connection with ISDA agreements generally provide us and our counterparties the right to setoff collateral against amounts owing under the ISDA agreements upon the occurrence of a default or a specified termination event.

        The following table presents amounts relevant to offsetting of our derivative assets and liabilities at September 30, 2013 and December 31, 2012.

 
   
  Gross amounts
not offset in consolidated
balance sheets
   
 
 
  Amounts
presented in
consolidated
balance
sheets(1)
   
 
 
  Financial
instruments
  Cash
collateral
received
(pledged)
  Net
amount
 
 
  (in millions)
 

September 30, 2013

                         

Total derivative assets

  $ 24.2   $ 5.2   $   $ 19.0  

Total derivative liabilities

    9.0     5.2         3.8  
                   

Net assets

  $ 15.2   $   $   $ 15.2  
                   

December 31, 2012

                         

Total derivative assets

  $ 17.3   $ 4.6   $   $ 12.7  

Total derivative liabilities

    5.5     4.6         0.9  
                   

Net assets

  $ 11.8   $   $   $ 11.8  
                   

(1)
We report the fair values of our derivative assets and liabilities on a gross basis on our consolidated balance sheets. As a result, the gross amounts recognized and net amounts presented are the same.

        Our exposure to credit loss from nonperformance by counterparties was approximately $19.0 million and $12.7 million at September 30, 2013 and December 31, 2012, respectively. We do not believe the contractually allowed netting, close-out netting or set-off of amounts owed to, or due from, the counterparties to our ISDA agreements would have a material effect on our financial position.

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16.   Treasury Stock

        In the third quarter of 2012, our Board of Directors authorized the repurchase of up to $3.0 billion of CF Holdings common stock through December 31, 2016. Repurchases under this program may be made from time to time in the open market, in privately negotiated transactions, or otherwise. The manner, timing, and amount of any repurchases are determined by our management based on evaluation of market conditions, stock price, and other factors. In the first nine months of 2013, we repurchased 5.8 million shares for $1.1 billion, of which 3.8 million shares were retired in May 2013. To date under this program 5.8 million shares have been repurchased for an aggregate expenditure of $1.1 billion. At September 30, 2013, we held in treasury approximately 2.0 million shares of repurchased stock.

17.   Accumulated Other Comprehensive Income (Loss)

        Changes to accumulated other comprehensive income (loss) (AOCI) are as follows:

 
  Foreign
Currency
Translation
Adjustment
  Unrealized
Gain (Loss)
on
Securities
  Unrealized
Gain (Loss)
on
Derivatives
  Defined
Benefit
Plans
  Accumulated
Other
Comprehensive
Income (Loss)
 
 
  (in millions)
 

Balance at December 31, 2011

  $ 15.4   $ (3.0 ) $   $ (111.7 ) $ (99.3 )

Unrealized gain

        2.3             2.3  

Gain arising during period

                13.4     13.4  

Reclassification to net earnings

        (0.3 )       8.7     8.4  

Effect of exchange rate changes and deferred taxes

    47.4     (0.5 )       (9.6 )   37.3  
                       

Balance at September 30, 2012

  $ 62.8   $ (1.5 ) $   $ (99.2 ) $ (37.9 )
                       

Balance at December 31, 2012

  $ 61.4   $ (0.4 ) $ 4.6   $ (115.2 ) $ (49.6 )

Unrealized gain (loss)

        1.3     (0.4 )       0.9  

Reclassification to net earnings

        (0.4 )       8.6     8.2  

Effect of exchange rate changes and deferred taxes

    (28.0 )   (0.6 )   0.1     (3.6 )   (32.1 )
                       

Balance at September 30, 2013

  $ 33.4   $ (0.1 ) $ 4.3   $ (110.2 ) $ (72.6 )
                       

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        Reclassifications out of AOCI during the nine months ended September 30, 2013 were as follows:

 
  Amount
Reclassified
from AOCI
  Affected line item in
consolidated statement
of operations
 
  (in millions)
   

Unrealized Gain (Loss) on Securities

         

Available-for-sale securities

  $ (0.4 ) Interest income
         

Total before tax

    (0.4 )  

Tax effect

    0.1    
         

Net of tax

  $ (0.3 )  
         

Defined Benefit Plans

         

Amortization of transition obligation

  $ (1)  

Amortization of prior service cost

    0.2 (1)  

Amortization of net loss

    8.4 (1)  
         

Total before tax

    8.6    

Tax effect

    (3.0 )  
         

Net of tax

  $ 5.6    
         

Total reclassifications for the period

  $ 5.3    
         

(1)
These AOCI components are included in the computation of net periodic benefit cost of our pension and other postretirement benefits.

18.   Contingencies

Litigation

West Fertilizer Co.

        In April 2013, there was a fire and explosion at the West Fertilizer Co. fertilizer storage and distribution facility in West, Texas. According to published reports, 15 people were killed and approximately 200 people were injured in the incident, and the fire and explosion damaged or destroyed a number of homes and buildings around the facility. We have been named as defendants in lawsuits filed in the District Court of McLennan County, Texas by the City of West, Texas and individual residents of the County seeking recovery for damages allegedly sustained as a result of the explosion. Plaintiffs allege various theories of negligence, strict liability and breach of warranty under Texas law. Although we do not own or operate the facility or directly sell our product to West Fertilizer Co., products we have manufactured and sold to others have been delivered to the facility and may have been stored at the West facility at the time of the incident. Based on the initial analysis of the pending lawsuits, we believe that we have strong legal and factual defenses to the claims and intend to defend ourselves vigorously in the pending lawsuits and any other claims brought against us in connection with the incident. In addition, the increased focus on the risks associated with fertilizers as a result of the incident could impact the regulatory environment and requirements applicable to fertilizer manufacturing and storage facilities.

Other Litigation

        From time to time, we are subject to ordinary, routine legal proceedings related to the usual conduct of our business, including proceedings regarding public utility and transportation rates,

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environmental matters, taxes and permits relating to the operations of our various plants and facilities. Based on the information available as of the date of this filing, we believe that the ultimate outcome of these matters will not have a material adverse effect on our consolidated financial position, results of operations or cash flows.

Environmental

Florida Environmental Matters

Clean Air Act Investigation

        On March 19, 2007, the Company received a letter from the EPA under Section 114 of the Federal Clean Air Act requesting information and copies of records relating to compliance with New Source Review, New Source Performance Standards, and National Emission Standards for Hazardous Air Pollutants at the Plant City facility. The Company provided the requested information to the EPA in late 2007. The EPA initiated this same process in relation to numerous other sulfuric acid plants and phosphoric acid plants throughout the nation, including other facilities in Florida.

        The Company received a Notice of Violation (NOV) from the EPA by letter dated June 16, 2010. The NOV alleges the Company violated the Prevention of Significant Deterioration (PSD) Clean Air Act regulations relating to certain projects undertaken at the Plant City facility's sulfuric acid plants. This NOV further alleges that the actions that are the basis for the alleged PSD violations also resulted in violations of Title V air operating permit regulations. Finally, the NOV alleges that the Company failed to comply with certain compliance dates established by hazardous air pollutant regulations for phosphoric acid manufacturing plants and phosphate fertilizer production plants. Although this matter has been referred to the United States Department of Justice (DOJ), the Company has continued to meet with the EPA to discuss these alleged violations. The Company does not know at this time if it will settle this matter prior to initiation of formal legal action.

        We cannot estimate the potential penalties, fines or other expenditures, if any, that may result from the Clean Air Act NOV and, therefore, we cannot determine if the ultimate outcome of this matter will have a material impact on the Company's financial position, results of operations or cash flows.

EPCRA/CERCLA Investigation

        Pursuant to a letter from the DOJ dated July 28, 2008 that was sent to representatives of the major U.S. phosphoric acid manufacturers, including CF Industries, the DOJ stated that it and the EPA believe that apparent violations of Section 313 of the Emergency Planning and Community Right-to-Know Act (EPCRA), which requires annual reports to be submitted with respect to the use of certain toxic chemicals, have occurred at all of the phosphoric acid facilities operated by these manufacturers. The letter also states that the DOJ and the EPA believe that most of these facilities have violated Section 304 of EPCRA and Section 103 of the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) by failing to provide required notifications relating to the release of hydrogen fluoride from these facilities. The letter did not specifically identify alleged violations at our Plant City, Florida complex or assert a claim for a specific amount of penalties. The EPA submitted an information request to the Company on February 11, 2009, as a follow-up to the July 2008 letter. The Company provided information in response to the agency's inquiry on May 14 and May 29, 2009.

        By letter dated July 6, 2010, the EPA issued a NOV to the Company alleging violations of EPCRA and CERCLA. The Company had an initial meeting with the EPA to discuss these alleged violations.

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The Company does not know at this time if it will settle this matter prior to initiation of formal legal action.

        We do not expect that penalties or fines, if any, that may arise out of the EPCRA/CERCLA matter will have a material impact on the Company's financial position, results of operations or cash flows.

Federal Numeric Nutrient Criteria Regulation

        On August 18, 2009, the EPA entered into a consent decree with certain environmental groups with respect to the promulgation of numeric criteria for nitrogen and phosphorous in surface waters in Florida. The consent decree was approved by a Federal district court judge on November 16, 2009. The EPA adopted final numeric nutrient criteria for Florida lakes and inland flowing waters on November 14, 2010. On February 18, 2012, the Court upheld parts of the numeric nutrient criteria regulation, but found that the EPA had not adequately justified the criteria for streams and therefore concluded that the adoption of such criteria was arbitrary and capricious. The Court ordered the EPA to issue proposed or final numeric nutrient criteria for streams by May 21, 2012. Subsequently, the Court granted the EPA's motion to allow the EPA to propose numeric nutrient criteria for streams by November 30, 2012 and to finalize such criteria by August 31, 2013.

        In December 2011, the State of Florida proposed its own numeric nutrient criteria for surface waters. The nitrogen and phosphorous criteria in the proposed rule are substantially identical to the federal rule, but the state proposal includes biological verification as a component of the criteria and adopts existing nutrient Total Maximum Daily Loads (TMDL) as applicable numeric criteria. The impact of these modifications could be to provide more flexibility with respect to nitrogen and phosphorous limits in wastewater discharge permits so long as such discharges do not impair the biological health of receiving water bodies. Environmental groups filed a challenge to the proposed state rule, but the rule was upheld by an administrative law judge on June 8, 2012, and became final. An appeal of the administrative decision upholding the rule is now pending before a Florida appellate court.

        On November 30, 2012, the EPA approved Florida's rule. However, because the EPA identified what it considered to be gaps in the scope of the waters covered by Florida's rule and potential legal issues that might bar the Florida rule from going into effect, the EPA, pursuant to the Court order described above, has again proposed numeric nutrient criteria for Florida streams. On March 15, 2013, the EPA and the FDEP announced an agreement in principle that would allow the EPA to withdraw its proposed rule subject to certain actions to be taken by FDEP and EPA.

        Notwithstanding the EPA's approval of the Florida rule, the federal criteria for lakes and inland waters previously upheld by the Court (excluding the criteria found to be arbitrary and capricious) became effective on January 6, 2013. The EPA intends to withdraw these criteria once the State of Florida completes all of the actions required pursuant to the aforementioned agreement in principle.

        On June 27, 2013, the EPA approved new water quality standards submitted by the FDEP relating to the scope of coverage of the FDEP's numeric nutrient criteria for surface waters. On June 28, 2013, the EPA (i) issued a finding that Florida's narrative criteria were sufficient to protect those surface waters that the FDEP had determined were not to be covered by the state numeric criteria and (ii) based on this finding, filed a motion to modify the August 2009 consent decree to exclude these surface waters from EPA's obligations under the consent decree. The Court has not yet ruled on this motion.

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        The 2009 consent decree also required the EPA to develop numeric nutrient criteria for Florida coastal and estuarine waters. On November 30, 2012, the EPA proposed numeric nutrient criteria for Florida coastal and estuarine waters. Subsequently, on July 31, 2013, and August 1, 2013, the FDEP submitted to EPA new numeric nutrient water quality standards for those waters. On September 26, 2013, EPA approved Florida's new and revised nutrient water quality standards for estuaries and coastal waters and informed the Court that as a result, it was not required to finalize the federal criteria that it had proposed on November 30, 2012.

        Due to potential challenges to these developments, federal or state numeric nutrient water quality criteria for Florida waters could result in substantially more stringent nitrogen and phosphorous limits in wastewater discharge permits for our mining, manufacturing and distribution operations in Florida. More stringent limits on wastewater discharge permits could increase our costs and limit our operations and, therefore, could have a material adverse effect on our business, financial condition, results of operations or cash flows.

Louisiana Environmental Matters

Clean Air Act—Section 185 Fee

        Our Donaldsonville Nitrogen Complex is located in a five-parish region near Baton Rouge, Louisiana that, as of 2005, was designated as being in "severe" nonattainment with respect to the national ambient air quality standard (NAAQS) for ozone (the 1-hour ozone standard) pursuant to the Federal Clean Air Act (the Act). Section 185 of the Act requires states, in their state implementation plans, to levy a fee (Section 185 fee) on major stationary sources (such as the Donaldsonville facility) located in a severe nonattainment area that did not meet the 1-hour ozone standard by November 30, 2005. The fee was to be assessed for each calendar year (beginning in 2006) until the area achieved compliance with the ozone NAAQS.

        Prior to the imposition of Section 185 fees, the EPA adopted a new ozone standard (the 8-hour ozone standard) and rescinded the 1-hour ozone standard. The Baton Rouge area was designated as a "moderate" nonattainment area with respect to the 8-hour ozone standard. However, because Section 185 fees had never been assessed prior to the rescission of the 1-hour ozone standard (rescinded prior to the November 30, 2005 ozone attainment deadline), the EPA concluded in a 2004 rulemaking implementing the 8-hour ozone standard that the Act did not require states to assess Section 185 fees. As a result, Section 185 fees were not assessed against CF Industries and other companies located in the Baton Rouge area.

        In 2006, the federal D.C. Circuit Court of Appeals rejected the EPA's position and held that Section 185 fees were controls that must be maintained and fees should have been assessed under the Act. In January 2008, the U.S. Supreme Court declined to accept the case for review, making the appellate court's decision final.

        In July 2011, the EPA approved a revision to Louisiana's air pollution program that eliminated the requirement for Baton Rouge area companies to pay Section 185 fees, based on Baton Rouge's ultimate attainment of the 1- hour standard through permanent and enforceable emissions reductions. EPA's approval of the Louisiana air program revision became effective on August 8, 2011. However, a recent decision by the federal D.C. Circuit Court of Appeals struck down a similar, but perhaps distinguishable, EPA guidance document regarding alternatives to Section 185 fees. At this time, the viability of EPA's approval of Louisiana's elimination of Section 185 fees is uncertain. Regardless of the approach ultimately adopted by the EPA, we expect that it is likely to be challenged by the environmental community, the states, and/or affected industries. Therefore, the costs associated with

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compliance with the Act cannot be determined at this time, and we cannot reasonably estimate the impact on the Company's financial position, results of operations or cash flows.

Clean Air Act Information Request

        On February 26, 2009, the Company received a letter from the EPA under Section 114 of the Act requesting information and copies of records relating to compliance with New Source Review and New Source Performance Standards at the Donaldsonville facility. The Company has completed the submittal of all requested information. There has been no further contact from the EPA regarding this matter.

Other

CERCLA/Remediation Matters

        From time to time, we receive notices from governmental agencies or third parties alleging that we are a potentially responsible party at certain cleanup sites under CERCLA or other environmental cleanup laws. In 2011, we received a notice from the Idaho Department of Environmental Quality (IDEQ) that alleged that we were a potentially responsible party for the cleanup of a former phosphate mine site we owned in the late 1950s and early 1960s located in Georgetown Canyon, Idaho. The current owner of the property and a former mining contractor received similar notices for the mine site. IDEQ requested that each party indicate its willingness to enter into negotiations for a remedial investigation of the site. The current owner indicated a willingness to negotiate. While reserving all rights and not admitting liability, we also indicated a willingness to negotiate. Negotiations are continuing. We are not able to estimate at this time our potential liability, if any, with respect to the cleanup of the site. However, based on currently available information, we do not expect that any remedial or financial obligations we may be subject to involving this or other cleanup sites will have a material adverse effect on our business, financial condition, results of operations or cash flows.

19.   Segment Disclosures

        We are organized and managed based on two business segments, which are differentiated primarily by their products, the markets they serve and the regulatory environments in which they operate. Our two business segments are the nitrogen segment and the phosphate segment. The Company's management uses gross margin to evaluate segment performance and allocate resources. Total other operating costs and expenses (consisting of selling, general and administrative expenses and other operating-net) and non-operating expenses (interest and income taxes), are centrally managed and are not included in the measurement of segment profitability reviewed by management.

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        Segment data for sales, cost of sales and gross margin for the three and nine months ended September 30, 2013 and 2012 are presented in the table below.

 
  Nitrogen   Phosphate   Consolidated  
 
  (in millions)
 

Three months ended September 30, 2013

                   

Net sales

                   

Ammonia

  $ 211.3   $   $ 211.3  

Granular urea

    185.3         185.3  

UAN

    393.6         393.6  

AN

    46.4         46.4  

DAP

        154.3     154.3  

MAP

        66.4     66.4  

Other

    39.7         39.7  
               

    876.3     220.7     1,097.0  

Cost of sales

    517.9     193.0     710.9  
               

Gross margin

  $ 358.4   $ 27.7   $ 386.1  
                 

Total other operating costs and expenses

                11.9  

Equity in earnings of operating affiliates

                11.2  
                   

Operating earnings

              $ 385.4  
                   

Three months ended September 30, 2012

                   

Net sales

                   

Ammonia

  $ 259.1   $   $ 259.1  

Granular urea

    262.7         262.7  

UAN

    474.4         474.4  

AN

    53.7         53.7  

DAP

        200.2     200.2  

MAP

        64.0     64.0  

Other

    45.3         45.3  
               

    1,095.2     264.2     1,359.4  

Cost of sales

    456.6     200.8     657.4  
               

Gross margin

  $ 638.6   $ 63.4   $ 702.0  
                 

Total other operating costs and expenses

                45.1  

Equity in earnings of operating affiliates

                10.2  
                   

Operating earnings

              $ 667.1  
                   

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  Nitrogen   Phosphate   Consolidated  
 
  (in millions)
 

Nine months ended September 30, 2013

                   

Net sales

                   

Ammonia

  $ 998.5   $   $ 998.5  

Granular urea

    720.0         720.0  

UAN

    1,487.6         1,487.6  

AN

    166.5         166.5  

DAP

        488.3     488.3  

MAP

        161.0     161.0  

Other

    126.5         126.5  
               

    3,499.1     649.3     4,148.4  

Cost of sales

    1,645.9     576.1     2,222.0  
               

Gross margin

  $ 1,853.2   $ 73.2   $ 1,926.4  
                 

Total other operating costs and expenses

                111.8  

Equity in earnings of operating affiliates

                32.3  
                   

Operating earnings

              $ 1,846.9  
                   

Nine months ended September 30, 2012

                   

Net sales

                   

Ammonia

  $ 1,164.3   $   $ 1,164.3  

Granular urea

    973.9         973.9  

UAN

    1,425.8         1,425.8  

AN

    181.6         181.6  

DAP

        583.2     583.2  

MAP

        168.4     168.4  

Other

    125.4         125.4  
               

    3,871.0     751.6     4,622.6  

Cost of sales

    1,577.4     588.1     2,165.5  
               

Gross margin

  $ 2,293.6   $ 163.5   $ 2,457.1  
                 

Total other operating costs and expenses

                153.3  

Equity in earnings of operating affiliates

                39.5  
                   

Operating earnings

              $ 2,343.3  
                   

        Total assets at September 30, 2013 and December 31, 2012, are presented below.

 
  Nitrogen   Phosphate   Other   Consolidated  
 
  (in millions)
 

Assets

                         

September 30, 2013

  $ 6,471.5   $ 779.2   $ 3,548.3   $ 10,799.0  

December 31, 2012

  $ 5,991.5   $ 795.2   $ 3,380.2   $ 10,166.9  

        The Other category of assets in the table above includes amounts attributable to corporate headquarters and unallocated corporate assets, such as our cash and cash equivalents, short-term investments, equity method investments and other investments.

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20.   Condensed Consolidating Financial Statements

        The following condensed consolidating financial information is presented in accordance with SEC Regulation S-X Rule 3-10, Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered, and relates to the Notes issued by CF Industries, Inc. (CF Industries), a 100% owned subsidiary of CF Industries Holdings, Inc. (Parent), described in Note 14, and the full and unconditional guarantee of such Notes by Parent and to debt securities of CF Industries, and the full and unconditional guarantee thereof by Parent, that may be offered and sold from time to time under the registration statement on Form S-3 filed by Parent and CF Industries with the Securities and Exchange Commission on April 22, 2013. Under the supplemental indentures governing the Notes, the Notes are to be guaranteed by Parent and each of its current and future subsidiaries, other than CF Industries, that from time to time is a borrower or guarantor under the Credit Agreement, or any renewal, replacement or refinancing thereof. At September 30, 2013, none of such subsidiaries of Parent was, or was required to be, a guarantor of the Notes. In the event that a subsidiary of Parent, other than CF Industries, becomes a borrower or a guarantor under the Credit Agreement, it would be required to become a guarantor of the Notes. For purposes of the presentation of condensed consolidating financial information, the subsidiaries of Parent other than CF Industries are referred to as the Other Subsidiaries.

        Presented below are condensed consolidating statements of operations and statements of cash flows for Parent, CF Industries and the Other Subsidiaries for the three and nine months ended September 30, 2013 and 2012, and condensed consolidating balance sheets for Parent, CF Industries and the Other Subsidiaries at September 30, 2013 and December 31, 2012. The condensed consolidating financial information presented below is not necessarily indicative of the financial position, results of operations, comprehensive income or cash flows of Parent, CF Industries or the Other Subsidiaries on a stand-alone basis.

        In this condensed consolidating financial information, investments in subsidiaries are presented under the equity method, in which our investments are recorded at cost and adjusted for our ownership share of a subsidiary's cumulative results of operations, distributions and other equity changes, and the eliminating entries reflect primarily intercompany transactions such as sales, accounts receivable and accounts payable and the elimination of equity investments and earnings of subsidiaries.

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Condensed, Consolidating Statement of Operations

 
  Three months ended September 30, 2013  
 
  Parent   CF Industries   Other
Subsidiaries
  Eliminations   Consolidated  
 
  (in millions)
 

Net sales

  $   $ 281.1   $ 1,207.3   $ (391.4 ) $ 1,097.0  

Cost of sales

        268.8     833.4     (391.3 )   710.9  
                       

Gross margin

        12.3     373.9     (0.1 )   386.1  
                       

Selling, general and administrative expenses

    0.5     2.0     29.8     (0.1 )   32.2  

Other operating—net

        (1.8 )   (18.5 )       (20.3 )
                       

Total other operating costs and expenses

    0.5     0.2     11.3     (0.1 )   11.9  

Equity in earnings of operating affiliates

            11.2         11.2  
                       

Operating earnings (loss)

    (0.5 )   12.1     373.8         385.4  

Interest expense

        44.7     (3.6 )   (0.1 )   41.0  

Interest income

        (0.1 )   (1.0 )   0.1     (1.0 )

Net (earnings) of wholly-owned subsidiaries

    (234.5 )   (254.6 )       489.1      

Other non-operating—net

        (0.2 )   (0.1 )       (0.3 )
                       

Earnings before income taxes and equity in losses of non-operating affiliates

    234.0     222.3     378.5     (489.1 )   345.7  

Income tax provision (benefit)

    (0.1 )   (12.2 )   121.3         109.0  

Equity in losses of non-operating affiliates—net of taxes

            7.2         7.2  
                       

Net earnings

    234.1     234.5     264.4     (489.1 )   243.9  

Less: Net earnings attributable to noncontrolling interest

            9.8         9.8  
                       

Net earnings attributable to common stockholders

  $ 234.1   $ 234.5   $ 254.6   $ (489.1 ) $ 234.1  
                       


Condensed, Consolidating Statement of Comprehensive Income

 
  Three months ended September 30, 2013  
 
  Parent   CF Industries   Other
Subsidiaries
  Eliminations   Consolidated  
 
  (in millions)
 

Net earnings

  $ 234.1   $ 234.5   $ 264.4   $ (489.1 ) $ 243.9  

Other comprehensive income

    42.7     42.7     42.7     (85.4 )   42.7  
                       

Comprehensive income

    276.8     277.2     307.1     (574.5 )   286.6  

Less: Comprehensive income attributable to noncontrolling interest

            9.8         9.8  
                       

Comprehensive income attributable to common stockholders

  $ 276.8   $ 277.2   $ 297.3   $ (574.5 ) $ 276.8  
                       

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Condensed, Consolidating Statement of Operations

 
  Nine months ended September 30, 2013  
 
  Parent   CF Industries   Other
Subsidiaries
  Eliminations   Consolidated  
 
  (in millions)
 

Net sales

  $   $ 885.8   $ 4,374.3   $ (1,111.7 ) $ 4,148.4  

Cost of sales

        691.3     2,638.3     (1,107.6 )   2,222.0  
                       

Gross margin

        194.5     1,736.0     (4.1 )   1,926.4  
                       

Selling, general and administrative expenses

    2.2     6.8     112.1     (0.1 )   121.0  

Other operating—net

        7.5     (16.7 )       (9.2 )
                       

Total other operating costs and expenses

    2.2     14.3     95.4     (0.1 )   111.8  

Equity in earnings of operating affiliates

            32.3         32.3  
                       

Operating earnings (loss)

    (2.2 )   180.2     1,672.9     (4.0 )   1,846.9  

Interest expense

        110.2     3.2     (1.0 )   112.4  

Interest income

        (0.7 )   (4.4 )   1.0     (4.1 )

Net (earnings) of wholly-owned subsidiaries

    (1,140.3 )   (1,094.2 )       2,234.5      

Other non-operating—net

        (0.2 )   54.3         54.1  
                       

Earnings before income taxes and equity in losses of non-operating affiliates

    1,138.1     1,165.1     1,619.8     (2,238.5 )   1,684.5  

Income tax provision (benefit)

    (0.7 )   24.7     475.3         499.3  

Equity in losses of non-operating affiliates—net of taxes

        (0.1 )   6.3         6.2  
                       

Net earnings

    1,138.8     1,140.3     1,150.8     (2,238.5 )   1,191.4  

Less: Net earnings attributable to noncontrolling interest

            56.6     (4.0 )   52.6  
                       

Net earnings attributable to common stockholders

  $ 1,138.8   $ 1,140.3   $ 1,094.2   $ (2,234.5 ) $ 1,138.8  
                       



Condensed, Consolidating Statement of Comprehensive Income

 
  Nine months ended September 30, 2013  
 
  Parent   CF Industries   Other
Subsidiaries
  Eliminations   Consolidated  
 
  (in millions)
 

Net earnings

  $ 1,138.8   $ 1,140.3   $ 1,150.8   $ (2,238.5 ) $ 1,191.4  

Other comprehensive income

    (23.0 )   (23.0 )   (69.7 )   92.0     (23.7 )
                       

Comprehensive income

    1,115.8     1,117.3     1,081.1     (2,146.5 )   1,167.7  

Less: Comprehensive income attributable to noncontrolling interest

            56.6     (4.7 )   51.9  
                       

Comprehensive income attributable to common stockholders

  $ 1,115.8   $ 1,117.3   $ 1,024.5   $ (2,141.8 ) $ 1,115.8  
                       

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Condensed, Consolidating Statement of Operations

 
  Three months ended September 30, 2012  
 
  Parent   CF Industries   Other
Subsidiaries
  Eliminations   Consolidated  
 
  (in millions)
 

Net sales

  $   $ 766.8   $ 715.1   $ (122.5 ) $ 1,359.4  

Cost of sales

        372.6     320.5     (35.7 )   657.4  
                       

Gross margin

        394.2     394.6     (86.8 )   702.0  
                       

Selling, general and administrative expenses

    0.5     30.5     5.5         36.5  

Other operating—net

        5.4     3.2         8.6  
                       

Total other operating costs and expenses

    0.5     35.9     8.7         45.1  

Equity in earnings of operating affiliates

        0.4     9.8         10.2  
                       

Operating earnings (loss)

    (0.5 )   358.7     395.7     (86.8 )   667.1  

Interest expense

        27.1     2.2     (0.6 )   28.7  

Interest income

        (0.4 )   (1.8 )   0.6     (1.6 )

Net (earnings) of wholly-owned subsidiaries

    (403.5 )   (191.1 )       594.6      

Other non-operating—net

        (0.1 )   (0.1 )       (0.2 )
                       

Earnings before income taxes and equity in earnings of non-operating affiliates

    403.0     523.2     395.4     (681.4 )   640.2  

Income tax (benefit) provision

    (0.3 )   119.7     86.6         206.0  

Equity in earnings of non-operating affiliates—net of taxes

            23.9         23.9  
                       

Net earnings

    403.3     403.5     332.7     (681.4 )   458.1  

Less: Net earnings attributable to noncontrolling interest

            141.6     (86.8 )   54.8  
                       

Net earnings attributable to common stockholders

  $ 403.3   $ 403.5   $ 191.1   $ (594.6 ) $ 403.3  
                       



Condensed, Consolidating Statement of Comprehensive Income

 
  Three months ended September 30, 2012  
 
  Parent   CF Industries   Other
Subsidiaries
  Eliminations   Consolidated  
 
  (in millions)
 

Net earnings

  $ 403.3   $ 403.5   $ 332.7   $ (681.4 ) $ 458.1  

Other comprehensive income

    37.3     37.3     27.6     (64.0 )   38.2  
                       

Comprehensive income

    440.6     440.8     360.3     (745.4 )   496.3  

Less: Comprehensive income attributable to noncontrolling interest

            141.6     (85.9 )   55.7  
                       

Comprehensive income attributable to common stockholders

  $ 440.6   $ 440.8   $ 218.7   $ (659.5 ) $ 440.6  
                       

38


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CF INDUSTRIES HOLDINGS, INC.


Condensed, Consolidating Statement of Operations

 
  Nine months ended September 30, 2012  
 
  Parent   CF Industries   Other
Subsidiaries
  Eliminations   Consolidated  
 
  (in millions)
 

Net sales

  $   $ 2,738.4   $ 2,271.1   $ (386.9 ) $ 4,622.6  

Cost of sales

        1,329.5     941.2     (105.2 )   2,165.5  
                       

Gross margin

        1,408.9     1,329.9     (281.7 )   2,457.1  
                       

Selling, general and administrative expenses

    2.0     92.2     17.4         111.6  

Other operating—net

        21.2     20.5         41.7  
                       

Total other operating costs and expenses

    2.0     113.4     37.9         153.3  

Equity in earnings of operating affiliates

        1.5     38.0         39.5  
                       

Operating earnings (loss)

    (2.0 )   1,297.0     1,330.0     (281.7 )   2,343.3  

Interest expense

        98.1     7.8     (1.0 )   104.9  

Interest income

        (0.8 )   (2.2 )   1.0     (2.0 )

Net (earnings) of wholly-owned subsidiaries

    (1,379.3 )   (604.1 )       1,983.4      

Other non-operating—net

        0.1     (1.0 )       (0.9 )
                       

Earnings before income taxes and equity in earnings of non-operating affiliates

    1,377.3     1,803.7     1,325.4     (2,265.1 )   2,241.3  

Income tax (benefit) provision

    (0.7 )   424.3     298.4         722.0  

Equity in (loss) earnings of non-operating affiliates—net of taxes

        (0.1 )   48.9         48.8  
                       

Net earnings

    1,378.0     1,379.3     1,075.9     (2,265.1 )   1,568.1  

Less: Net earnings attributable to noncontrolling interest

            471.8     (281.7 )   190.1  
                       

Net earnings attributable to common stockholders

  $ 1,378.0   $ 1,379.3   $ 604.1   $ (1,983.4 ) $ 1,378.0  
                       



Condensed, Consolidating Statement of Comprehensive Income

 
  Nine months ended September 30, 2012  
 
  Parent   CF Industries   Other
Subsidiaries
  Eliminations   Consolidated  
 
  (in millions)
 

Net earnings

  $ 1,378.0   $ 1,379.3   $ 1,075.9   $ (2,265.1 ) $ 1,568.1  

Other comprehensive income

    61.3     61.3     48.4     (108.6 )   62.4  
                       

Comprehensive income

    1,439.3     1,440.6     1,124.3     (2,373.7 )   1,630.5  

Less: Comprehensive income attributable to noncontrolling interest

            471.8     (280.7 )   191.1  
                       

Comprehensive income attributable to common stockholders

  $ 1,439.3   $ 1,440.6   $ 652.5   $ (2,093.0 ) $ 1,439.4  
                       

39


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CF INDUSTRIES HOLDINGS, INC.


Condensed, Consolidating Balance Sheet

 
  September 30, 2013  
 
  Parent   CF Industries   Other
Subsidiaries
  Eliminations
and
Reclassifications
  Consolidated  
 
  (in millions)
 

Assets

                               

Current assets:

                               

Cash and cash equivalents

  $ 0.1   $ 72.1   $ 2,214.0   $   $ 2,286.2  

Restricted cash

            111.4         111.4  

Accounts and notes receivable—net

    24.1     153.1     689.4     (679.7 )   186.9  

Inventories—net

        66.6     290.8         357.4  

Prepaid income taxes

    0.8         61.0     (26.0 )   35.8  

Deferred income taxes

        128.6     44.1     (128.6 )   44.1  

Other

        0.7     37.2         37.9  
                       

Total current assets

    25.0     421.1     3,447.9     (834.3 )   3,059.7  

Property, plant and equipment—net

        452.0     3,798.0         4,250.0  

Asset retirement obligation funds

        200.8             200.8  

Investments in and advances to affiliates

    4,894.5     7,851.0     931.6     (12,745.3 )   931.8  

Due from affiliates

    570.7         1.7     (572.4 )    

Goodwill

        0.9     2,063.6         2,064.5  

Other assets

        75.7     216.5         292.2  
                       

Total assets

  $ 5,490.2   $ 9,001.5   $ 10,459.3   $ (14,152.0 ) $ 10,799.0  
                       

Liabilities and Equity

                               

Current liabilities:

                               

Accounts and notes payable and accrued expenses

  $ 384.4   $ 258.2   $ 504.0   $ (679.7 ) $ 466.9  

Income taxes payable

        29.6         (26.0 )   3.6  

Customer advances