Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Oct. 31, 2016 | |
Document and Entity Information | ||
Entity Registrant Name | CF Industries Holdings, Inc. | |
Entity Central Index Key | 1,324,404 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 233,114,169 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q3 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Income Statement [Abstract] | ||||
Net sales | $ 680 | $ 928 | $ 2,818 | $ 3,193 |
Cost of sales | 678 | 763 | 2,072 | 1,926 |
Gross margin | 2 | 165 | 746 | 1,267 |
Selling, general and administrative expenses | 44 | 42 | 141 | 120 |
Transaction costs | 0 | 37 | 179 | 37 |
Other operating—net | 57 | 33 | 181 | 74 |
Total other operating costs and expenses | 101 | 112 | 501 | 231 |
Equity in (losses) earnings of operating affiliates | (2) | 6 | (11) | 20 |
Operating (loss) earnings | (101) | 59 | 234 | 1,056 |
Interest expense | 31 | 30 | 130 | 93 |
Interest income | (2) | 0 | (4) | (1) |
Other non-operating—net | 1 | 5 | (1) | 5 |
(Loss) earnings before income taxes and equity in earnings of non-operating affiliates | (131) | 24 | 109 | 959 |
Income tax (benefit) provision | (131) | 20 | (21) | 333 |
Equity in earnings of non-operating affiliates—net of taxes | 0 | 93 | 0 | 72 |
Net earnings | 0 | 97 | 130 | 698 |
Less: Net earnings attributable to noncontrolling interests | 30 | 7 | 87 | 25 |
Net (loss) earnings attributable to common stockholders | $ (30) | $ 90 | $ 43 | $ 673 |
Net earnings per share attributable to common stockholders: | ||||
Basic (in dollars per share) | $ (0.13) | $ 0.39 | $ 0.19 | $ 2.85 |
Diluted (in dollars per share) | $ (0.13) | $ 0.39 | $ 0.19 | $ 2.84 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 233.1 | 233.1 | 233.2 | 236 |
Diluted (in shares) | 233.1 | 234 | 233.5 | 236.9 |
Dividends declared per common share (in dollars per share) | $ 0.30 | $ 0.30 | $ 0.90 | $ 0.90 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Statement of Comprehensive Income [Abstract] | ||||
Net earnings | $ 0 | $ 97 | $ 130 | $ 698 |
Other comprehensive (loss) income: | ||||
Foreign currency translation adjustment—net of taxes | (30) | (50) | (20) | (100) |
Unrealized gain (loss) on securities - net of taxes | 0 | (1) | 0 | (1) |
Defined benefit plans—net of taxes | 0 | 43 | (3) | 47 |
Total other comprehensive income (loss) | (30) | (8) | (23) | (54) |
Comprehensive (loss) income | (30) | 89 | 107 | 644 |
Less: Comprehensive income attributable to noncontrolling interests | 30 | 7 | 87 | 25 |
Comprehensive (loss) income attributable to common stockholders | $ (60) | $ 82 | $ 20 | $ 619 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets: | ||||
Cash and cash equivalents | $ 1,554 | $ 286 | $ 943 | $ 1,997 |
Restricted cash | 7 | 23 | ||
Accounts receivable—net | 207 | 267 | ||
Inventories | 312 | 321 | ||
Prepaid income taxes | 830 | 185 | ||
Other current assets | 21 | 45 | ||
Total current assets | 2,931 | 1,127 | ||
Property, plant and equipment—net | 9,725 | 8,539 | ||
Investments in affiliates | 287 | 298 | ||
Goodwill | 2,359 | 2,390 | ||
Other assets | 330 | 329 | ||
Total assets | 15,632 | 12,683 | ||
Current liabilities: | ||||
Accounts payable and accrued expenses | 843 | 918 | ||
Income taxes payable | 1 | 5 | ||
Customer advances | 86 | 162 | ||
Other current liabilities | 36 | 130 | ||
Total current liabilities | 966 | 1,215 | ||
Long-term debt | 5,540 | 5,537 | ||
Deferred income taxes | 1,642 | 916 | ||
Other liabilities | 504 | 628 | ||
Stockholders' equity: | ||||
Preferred stock—$0.01 par value, 50,000,000 shares authorized | 0 | 0 | ||
Common stock—$0.01 par value, 500,000,000 shares authorized, 2016—235,503,291 shares issued and 2015—235,493,395 shares issued | 2 | 2 | ||
Paid-in capital | 1,390 | 1,378 | ||
Retained earnings | 2,892 | 3,058 | ||
Treasury stock—at cost, 2016—2,390,122 shares and 2015—2,411,839 shares | (151) | (153) | ||
Accumulated other comprehensive loss | (273) | (250) | (214) | (160) |
Total stockholders' equity | 3,860 | 4,035 | ||
Noncontrolling interests | 3,120 | 352 | 356 | 363 |
Total equity | 6,980 | 4,387 | $ 4,467 | $ 4,572 |
Total liabilities and equity | $ 15,632 | $ 12,683 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 235,503,291 | 235,493,395 |
Treasury stock, shares | 2,390,122 | 2,411,839 |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Millions | Total | Common Stock | Treasury Stock | Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Stockholders' Equity | Noncontrolling Interests |
Balance at Dec. 31, 2014 | $ 4,572 | $ 2 | $ (222) | $ 1,414 | $ 3,175 | $ (160) | $ 4,209 | $ 363 |
Increase (decrease) in equity | ||||||||
Net earnings | 698 | 673 | 673 | 25 | ||||
Other comprehensive income: | ||||||||
Foreign currency translation adjustment—net of taxes | (100) | (100) | (100) | |||||
Unrealized gain (loss) on securities - net of taxes | (1) | (1) | (1) | |||||
Defined benefit plans—net of taxes | 47 | 47 | 47 | |||||
Comprehensive (loss) income | 644 | 619 | 25 | |||||
Purchases of treasury stock | (527) | (527) | (527) | |||||
Retirement of treasury stock | 0 | 0 | 597 | (62) | (535) | 0 | ||
Acquisition of treasury stock under employee stock plans | (1) | (1) | 0 | 0 | (1) | |||
Issuance of $0.01 par value common stock under employee stock plans | 8 | 0 | 8 | 0 | 8 | |||
Stock-based compensation expense | 13 | 13 | 13 | |||||
Excess tax benefit from stock-based compensation | 2 | 2 | 2 | |||||
Cash dividends ($0.90 and $0.90 per share) for the nine months ended September 30, 2016 and 2015 respectively | (212) | (212) | (212) | |||||
Distributions declared to noncontrolling interest | (32) | (32) | ||||||
Balance at Sep. 30, 2015 | 4,467 | 2 | (153) | 1,375 | 3,101 | (214) | 4,111 | 356 |
Balance at Dec. 31, 2015 | 4,387 | 2 | (153) | 1,378 | 3,058 | (250) | 4,035 | 352 |
Increase (decrease) in equity | ||||||||
Net earnings | 130 | 43 | 43 | 87 | ||||
Other comprehensive income: | ||||||||
Foreign currency translation adjustment—net of taxes | (20) | (20) | (20) | 0 | ||||
Unrealized gain (loss) on securities - net of taxes | 0 | |||||||
Defined benefit plans—net of taxes | (3) | (3) | (3) | |||||
Comprehensive (loss) income | 107 | 20 | 87 | |||||
Acquisition of treasury stock under employee stock plans | (1) | 0 | (1) | 0 | 0 | (1) | ||
Issuance of $0.01 par value common stock under employee stock plans | 0 | 3 | (3) | 0 | 0 | |||
Stock-based compensation expense | 15 | 15 | 15 | |||||
Cash dividends ($0.90 and $0.90 per share) for the nine months ended September 30, 2016 and 2015 respectively | (209) | (209) | (209) | |||||
Issuance of noncontrolling interest in CF Industries Nitrogen, LLC (CFN) | 2,792 | 2,792 | ||||||
Distributions declared to noncontrolling interest | (111) | (111) | ||||||
Balance at Sep. 30, 2016 | $ 6,980 | $ 2 | $ (151) | $ 1,390 | $ 2,892 | $ (273) | $ 3,860 | $ 3,120 |
CONSOLIDATED STATEMENTS OF EQU7
CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - $ / shares | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Statement of Stockholders' Equity [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Cash Dividends (dollars per share) | $ 0.9 | $ 0.90 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Operating Activities: | ||
Net earnings | $ 130 | $ 698 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation and amortization | 475 | 348 |
Deferred income taxes | 730 | (6) |
Stock-based compensation expense | 15 | 13 |
Unrealized (gain) loss on natural gas and foreign currency derivatives | (169) | 70 |
Unrealized loss on embedded derivative | 22 | 0 |
Gain on remeasurement of CF Fertilisers UK investment | 0 | (94) |
Loss on sale of equity method investments | 0 | 43 |
Loss on disposal of property, plant and equipment | 8 | 18 |
Undistributed earnings of affiliates—net of taxes | 0 | (2) |
Changes in: | ||
Accounts receivable—net | 55 | 16 |
Inventories | (4) | (72) |
Accrued and prepaid income taxes | (665) | (69) |
Accounts payable and accrued expenses | (7) | 32 |
Customer advances | (75) | 56 |
Other—net | 76 | 23 |
Net cash provided by operating activities | 591 | 1,074 |
Investing Activities: | ||
Additions to property, plant and equipment | (1,819) | (1,791) |
Proceeds from sale of property, plant and equipment | 8 | 9 |
Proceeds from sale of equity method investment | 0 | 13 |
Purchase of CF Fertilisers UK, net of cash acquired | 0 | (554) |
Withdrawals from restricted cash funds | 16 | 60 |
Other—net | 4 | (36) |
Net cash used in investing activities | (1,791) | (2,299) |
Financing Activities: | ||
Proceeds from long-term borrowings | 0 | 1,000 |
Proceeds from short-term borrowings | 150 | 367 |
Payments of short-term borrowings | (150) | (367) |
Financing fees | (11) | (28) |
Dividends paid on common stock | (209) | (212) |
Issuance of noncontrolling interest in CFN | 2,800 | 0 |
Distributions to noncontrolling interests | (111) | (32) |
Purchases of treasury stock | 0 | (556) |
Issuances of common stock under employee stock plans | 0 | 8 |
Shares withheld for taxes | 0 | (1) |
Net cash provided by financing activities | 2,469 | 179 |
Effect of exchange rate changes on cash and cash equivalents | (1) | (8) |
Increase (decrease) in cash and cash equivalents | 1,268 | (1,054) |
Cash and cash equivalents at beginning of period | 286 | 1,997 |
Cash and cash equivalents at end of period | $ 1,554 | $ 943 |
Background and Basis of Present
Background and Basis of Presentation | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Background and Basis of Presentation | Background and Basis of Presentation We are one of the largest manufacturers and distributors of nitrogen fertilizer and other nitrogen products in the world. Our principal customers are cooperatives, independent fertilizer distributors, farmers and industrial users. Our principal nitrogen fertilizer products are ammonia, granular urea, urea ammonium nitrate solution (UAN) and ammonium nitrate (AN). Our other nitrogen products include diesel exhaust fluid (DEF), urea liquor, nitric acid and aqua ammonia, which are sold primarily to our industrial customers, and compound fertilizer products (NPKs), which are solid granular fertilizer products for which the nutrient content is a combination of nitrogen, phosphorus, and potassium. Our manufacturing and distribution facilities are concentrated in the midwestern United States and other major agricultural areas of the United States, Canada and the United Kingdom. We also export nitrogen fertilizer products from our Donaldsonville, Louisiana; Yazoo City, Mississippi; and Billingham, United Kingdom manufacturing facilities. All references to "the Company," "we," "us" and "our" refer to CF Industries Holdings, Inc. and its subsidiaries. All references to "CF Holdings" refer to CF Industries Holdings, Inc. itself and not its subsidiaries. All references to "CF Industries" refer to CF Industries, Inc., a 100% owned subsidiary of CF Industries Holdings, Inc. 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, 2015 , in accordance with U.S. generally accepted accounting principles (GAAP) 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 accompanying unaudited interim consolidated financial statements 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 U.S. GAAP 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. The accompanying unaudited interim consolidated financial statements should be read in conjunction with our audited consolidated financial statements and related disclosures included in our 2015 Annual Report on Form 10-K filed with the SEC on February 25, 2016. The preparation of the unaudited interim consolidated financial statements requires us to make use of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the unaudited consolidated financial statements and the reported revenues and expenses for the periods presented. Significant estimates and assumptions are used for, but are not limited to, net realizable value of inventories, environmental remediation liabilities, environmental and litigation contingencies, the cost of customer incentives, useful lives of property and identifiable intangible assets, the assumptions used in the evaluation of potential 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 defined benefit pension and other postretirement benefit plans and the assumptions used in the valuation of stock-based compensation awards granted to employees. During the third quarter of 2016, we adopted Accounting Standards Update (ASU) No. 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. As a result, we reclassified certain amounts in our consolidated statement of cash flows for the nine months ended September 30, 2015. See Note 2—New Accounting Standards for additional information. |
New Accounting Standards
New Accounting Standards | 9 Months Ended |
Sep. 30, 2016 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
New Accounting Standards | New Accounting Standards Recently Adopted Pronouncements In March 2016, the Financial Accounting Standards Board (FASB) issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. This ASU makes a number of changes meant to simplify and improve accounting for share-based payments, including amendments to share-based accounting for income taxes, classifications in the statement of cash flows and share award forfeiture accounting. We elected to early adopt ASU No. 2016-09 in the third quarter of 2016. As a result, we retrospectively recast our consolidated statement of cash flows for the nine months ended September 30, 2015 by reclassifying $2 million of excess tax benefit previously reported in financing activities to operating activities and $1 million of cash outflows related to shares withheld for taxes from operating activities to financing activities. We also elected to recognize equity award forfeitures as they occur to determine the amount of compensation cost to be recognized in each period. The update also requires us to recognize excess tax benefits and tax deficiencies in the statement of operations when awards are settled. The adoption of this ASU did not have a material effect on our consolidated financial statements. In April 2015, the FASB issued ASU No. 2015-03, Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. This ASU requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of the related debt liability instead of being presented as an asset. The ASU requires retrospective application and represents a change in accounting principle. In August 2015, the FASB issued the related ASU No. 2015-15, Interest—Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements, which clarifies ASU No. 2015-03 and states that the SEC staff would not object to an entity deferring and presenting debt issuance costs related to a line-of-credit arrangement as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. We adopted ASU No. 2015-03 and ASU No. 2015-15 retrospectively in the first quarter of 2016, which resulted in the reclassification of deferred debt issuance costs of $56 million from other assets to an offset of long-term debt on our consolidated balance sheet as of December 31, 2015. Deferred debt issuance costs related to our senior unsecured revolving credit agreement continue to be reflected in other assets. See Note 12—Financing Agreements for additional information. Recently Issued Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which supersedes the lease accounting requirements in Accounting Standards Codification (ASC) Topic 840, Leases. This ASU will require lessees to recognize the rights and obligations resulting from virtually all leases (other than leases that meet the definition of a short-term lease) on their balance sheets as right-of-use assets with corresponding lease liabilities. Extensive quantitative and qualitative disclosures, including significant judgments made by management, will be required to provide greater insight into the extent of income and expense recognized and expected to be recognized from existing contracts. This ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018, with early adoption permitted, and requires the modified retrospective method of adoption. We are currently evaluating the impact of the adoption of this ASU on our consolidated financial statements. In July 2015, the FASB issued ASU No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory, effective for annual and interim periods beginning after December 15, 2016. ASU No. 2015-11 changes the inventory measurement principle for entities using the first-in, first out (FIFO) or average cost methods. For entities utilizing one of these methods, the inventory measurement principle will change from lower of cost or market to the lower of cost and net realizable value. We follow the FIFO or average cost methods and are currently evaluating the impact of the adoption of this ASU on our consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in ASC Topic 605, Revenue Recognition. This ASU is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This ASU also requires additional disclosure about the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments. Additionally, the costs to obtain and fulfill a contract, including assets to be recognized, are to be capitalized and such capitalized costs should be disclosed. In 2016, the FASB issued additional ASUs that enhance the operability of the principal versus agent guidance in ASU No. 2014-09 by clarifying that an entity should consider the nature of each good or service promised to a customer at the individual good or service level, clarify that ASU No. 2014-09 should not be applied to immaterial performance obligations, and enhance the guidance around the treatment of shipping costs incurred to fulfill performance obligations. As modified by ASU No. 2015-14, Deferral of the Effective Date, the effective date of ASU No. 2014-09 is for interim and annual periods beginning after December 15, 2017, with early adoption permitted for interim and annual periods beginning after December 15, 2016. We are currently in the assessment phase of evaluating the impact of the adoption of ASU No. 2014-09, as amended, on our consolidated financial statements. |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2016 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions CF Fertilisers UK Acquisition On July 31, 2015, we acquired the remaining 50% equity interest in CF Fertilisers UK Group Limited (formerly known as GrowHow UK Group Limited) (CF Fertilisers UK) not previously owned by us for total consideration of $570 million , and CF Fertilisers UK became wholly owned by us. The purchase price was funded with cash on hand. Prior to July 31, 2015, our initial 50% equity interest in CF Fertilisers UK was accounted for as an equity method investment, and the financial results of this investment were included in our consolidated statements of operations in equity in earnings of non-operating affiliates—net of taxes. During the third quarter of 2015, we recorded a gain of $94 million on the measurement to fair value of our initial 50% equity interest in CF Fertilisers UK that is included in equity in earnings of non-operating affiliates—net of taxes. The following table summarizes the allocation of the total fair value of CF Fertilisers UK to the assets acquired and liabilities assumed in its acquisition on July 31, 2015. The fair value of the assets acquired and liabilities assumed is based on the estimated net realizable value for inventories, a replacement cost approach for property, plant and equipment and the income approach for intangible assets. Original Valuation Net Adjustments to Fair Value in 2015 Adjusted Valuation as of December 31, 2015 Net Adjustments to Fair Value in 2016 (1) Final Valuation (in millions) Fair value of consideration transferred $ 570 $ — $ 570 $ — $ 570 Fair value of 50% of equity interest already held by the Company 570 — 570 — 570 Total fair value $ 1,140 $ — $ 1,140 $ — $ 1,140 Assets acquired and liabilities assumed Current assets $ 165 $ 1 $ 166 $ — $ 166 Property, plant and equipment 898 — 898 — 898 Goodwill 328 (8 ) 320 4 324 Other assets 140 (1 ) 139 — 139 Total assets acquired 1,531 (8 ) 1,523 4 1,527 Current liabilities 74 1 75 — 75 Deferred income taxes 129 (9 ) 120 4 124 Other liabilities 188 — 188 — 188 Total liabilities assumed 391 (8 ) 383 4 387 Total net assets acquired $ 1,140 $ — $ 1,140 $ — $ 1,140 _______________________________________________________________________________ (1) In July 2016, final adjustments were made to the fair value of the assets acquired and liabilities assumed, which resulted in a corresponding $4 million increase to goodwill. Current assets acquired included cash of $19 million , accounts receivable of $73 million and inventories of $67 million . The acquired property, plant and equipment is being depreciated over a period consistent with our existing fixed assets depreciation policy. The acquisition resulted in the recognition of $324 million of goodwill, which is not deductible for income tax purposes. Other assets acquired included intangible assets of $132 million consisting of customer relationships and trade names which are being amortized over a weighted-average life of approximately 20 years. See Note 7—Goodwill and Other Intangible Assets for additional information. Termination of Agreement to Combine with Certain of OCI N.V.’s Businesses On August 6, 2015, we entered into a definitive agreement (as amended, the Combination Agreement) to combine with the European, North American and global distribution businesses of OCI N.V. (OCI). On May 22, 2016, CF Holdings, OCI and the other parties to the Combination Agreement entered into a termination agreement (the Termination Agreement) under which the parties agreed to terminate the Combination Agreement by mutual written consent. Pursuant to the Termination Agreement, CF Holdings paid OCI a termination fee of $150 million , which is included in transaction costs in our consolidated statements of operations. Under the Termination Agreement, the parties to the Combination Agreement also agreed to release each other from any and all claims, actions, obligations, liabilities, expenses and fees in connection with, arising out of or related to the Combination Agreement and all ancillary agreements contemplated thereby (other than the confidentiality agreement between CF Holdings and OCI) or the transactions contemplated therein or thereby. See Note 12—Financing Agreements —Bridge Credit Agreement for additional information. |
Net Earnings Per Share
Net Earnings Per Share | 9 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Net Earnings Per Share | Net Earnings Per Share Net earnings per share were computed as follows: Three months ended Nine months ended 2016 2015 2016 2015 (in millions, except per share amounts) Net (loss) earnings attributable to common stockholders $ (30 ) $ 90 $ 43 $ 673 Basic earnings per common share: Weighted-average common shares outstanding 233.1 233.1 233.2 236.0 Net (loss) earnings attributable to common stockholders $ (0.13 ) $ 0.39 $ 0.19 $ 2.85 Diluted earnings per common share: Weighted-average common shares outstanding 233.1 233.1 233.2 236.0 Dilutive common shares—stock options — 0.9 0.3 0.9 Diluted weighted-average shares outstanding 233.1 234.0 233.5 236.9 Net (loss) earnings attributable to common stockholders $ (0.13 ) $ 0.39 $ 0.19 $ 2.84 In the computation of diluted earnings per common share, potentially dilutive stock options are excluded if the effect of their inclusion is anti-dilutive. Shares for anti-dilutive stock options not included in the computation of diluted earnings per common share were 5.0 million and 4.3 million for the three and nine months ended September 30, 2016 , respectively, and 0.8 million for both the three and nine months ended September 30, 2015 . |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2016 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consist of the following: September 30, December 31, (in millions) Finished goods $ 280 $ 286 Raw materials, spare parts and supplies 32 35 Total inventories $ 312 $ 321 |
Property, Plant and Equipment-N
Property, Plant and Equipment-Net | 9 Months Ended |
Sep. 30, 2016 | |
Property, Plant and Equipment, Net [Abstract] | |
Property, Plant and Equipment-Net | Property, Plant and Equipment—Net Property, plant and equipment—net consists of the following: September 30, December 31, (in millions) Land $ 66 $ 68 Machinery and equipment 7,754 7,348 Buildings and improvements 342 271 Construction in progress (1) 4,682 3,626 Property, plant and equipment 12,844 11,313 Less: Accumulated depreciation and amortization 3,119 2,774 Property, plant and equipment—net $ 9,725 $ 8,539 _______________________________________________________________________________ (1) As of September 30, 2016 and December 31, 2015 , we had construction in progress that was accrued but unpaid of $426 million and $543 million , respectively. These amounts included accruals related to our capacity expansion projects of $384 million and $471 million as of September 30, 2016 and December 31, 2015 , respectively. Depreciation and amortization related to property, plant and equipment was $139 million and $425 million for the three and nine months ended September 30, 2016 , respectively, and $117 million and $317 million for the three and nine months ended September 30, 2015 , respectively. Plant turnarounds —Scheduled inspections, replacements and overhauls of plant machinery and equipment at our continuous process manufacturing facilities during a full plant shutdown are referred to as plant turnarounds. The expenditures related to turnarounds are capitalized in property, plant and equipment when incurred. The following is a summary of capitalized plant turnaround costs: Nine months ended 2016 2015 (in millions) Net capitalized turnaround costs: Beginning balance $ 220 $ 153 Additions 60 100 Depreciation (66 ) (47 ) Effect of exchange rate changes 2 (2 ) Ending balance $ 216 $ 204 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 amounts are not considered turnaround costs and are not capitalized. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 9 Months Ended |
Sep. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets The following table shows the carrying amount of goodwill by reportable segment as of September 30, 2016 and December 31, 2015 : Ammonia Granular Urea UAN AN Other Total (in millions) Balance as of December 31, 2015 $ 587 $ 828 $ 576 $ 324 $ 75 $ 2,390 CF Fertilisers UK (1) — — — 3 1 4 Effect of exchange rate changes — — — (31 ) (4 ) (35 ) Balance as of September 30, 2016 $ 587 $ 828 $ 576 $ 296 $ 72 $ 2,359 _______________________________________________________________________________ (1) In July 2016, final adjustments were made to the fair value of the assets acquired and liabilities assumed in the acquisition of the remaining 50% equity interest in CF Fertilisers UK not previously owned by us, which resulted in a corresponding $4 million increase to goodwill. See Note 3—Acquisitions for additional information. All of our identifiable intangible assets have definite lives and are presented in other assets on our consolidated balance sheets at gross carrying amount, net of accumulated amortization, as follows: September 30, 2016 December 31, 2015 Gross Carrying Amount Accumulated Amortization Net Gross Carrying Amount Accumulated Amortization Net (in millions) Intangible assets: Customer relationships $ 129 $ (23 ) $ 106 $ 140 $ (18 ) $ 122 TerraCair brand 10 (10 ) — 10 (10 ) — Trade names 31 (2 ) 29 35 (1 ) 34 Total intangible assets $ 170 $ (35 ) $ 135 $ 185 $ (29 ) $ 156 Amortization expense of our identifiable intangible assets was $2 million and $6 million for the three and nine months ended September 30, 2016 , respectively, and $2 million and $8 million for the three and nine months ended September 30, 2015 , respectively. In early 2015, management approved a plan to discontinue the usage of TerraCair brand in the sale of DEF. Based on the change in the usage of this brand, the related intangible assets were fully amortized during the first quarter of 2015. Total estimated amortization expense for the remainder of 2016 and each of the five succeeding fiscal years is as follows: Estimated Amortization Expense (in millions) Remainder of 2016 $ 2 2017 9 2018 9 2019 9 2020 9 2021 9 |
Equity Method Investments
Equity Method Investments | 9 Months Ended |
Sep. 30, 2016 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments | Equity Method Investments Operating Equity Method Investment As of September 30, 2016 and December 31, 2015 , we have a 50% ownership interest in Point Lisas Nitrogen Limited (PLNL), which operates an ammonia production facility in the Republic of Trinidad and Tobago. We include our share of the net earnings from this equity method investment as an element of earnings from operations because PLNL provides additional production to our operations and is integrated with our other supply chain and sales activities in the ammonia segment. The total carrying value of our equity method investment in PLNL as of September 30, 2016 was $207 million more than our share of PLNL's book value. The excess is primarily attributable to the purchase accounting impact of our acquisition of the investment in PLNL and reflects 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 amortized over a remaining period of approximately 17 years and 2 years , respectively. Our equity in earnings of PLNL is different from our ownership interest in income reported by PLNL due to amortization of these basis differences. Our equity in losses of PLNL for the nine months ended September 30, 2016 of $11 million includes the impact of a planned maintenance activity in the second quarter of 2016 that resulted in the shutdown of the PLNL ammonia plant for approximately 45 days. 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 $13 million and $47 million for the three and nine months ended September 30, 2016 , respectively, and $27 million and $84 million for the three and nine months ended September 30, 2015 , respectively. In the fourth quarter of 2015, we determined the carrying value of our investment in PLNL exceeded fair value and recognized an impairment charge of $62 million . See Note 9—Fair Value Measurements for additional information. Non-Operating Equity Method Investments We no longer have non-operating equity method investments as a result of the sale of our 50% ownership interest in KEYTRADE AG during the second quarter of 2015 and our July 31, 2015 acquisition of the remaining 50% equity interest in CF Fertilisers UK not previously owned by us. See Note 3—Acquisitions for additional information. Equity in earnings of non-operating affiliates—net of taxes for the three months ended September 30, 2015 of $93 million includes the after-tax gain on remeasurement to fair value of our initial 50% equity interest in CF Fertilisers UK and our equity in losses of CF Fertilisers UK through the acquisition date. Equity in earnings of non-operating affiliates—net of taxes for the nine months ended September 30, 2015 of $72 million includes our after-tax gain on remeasurement to fair value of our initial 50% equity interest in CF Fertilisers UK, the after-tax loss on the sale of our interests in Keytrade, and our equity in earnings (losses) of Keytrade, through the date of sale, and CF Fertilisers UK, through the acquisition date. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Our cash and cash equivalents and other investments consist of the following: September 30, 2016 Cost Basis Unrealized Gains Unrealized Losses Fair Value (in millions) Cash $ 113 $ — $ — $ 113 Cash equivalents: U.S. and Canadian government obligations 1,417 — — 1,417 Other debt securities 24 — — 24 Total cash and cash equivalents $ 1,554 $ — $ — $ 1,554 Restricted cash 7 — — 7 Nonqualified employee benefit trusts 17 2 — 19 December 31, 2015 Cost Basis Unrealized Gains Unrealized Losses Fair Value (in millions) Cash $ 71 $ — $ — $ 71 Cash equivalents: U.S. and Canadian government obligations 190 — — 190 Other debt securities 25 — — 25 Total cash and cash equivalents $ 286 $ — $ — $ 286 Restricted cash 23 — — 23 Nonqualified employee benefit trusts 18 1 — 19 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. Assets and Liabilities Measured at Fair Value on a Recurring Basis The following tables present assets and liabilities included in our consolidated balance sheets as of September 30, 2016 and December 31, 2015 that are recognized at fair value on a recurring basis, and indicate the fair value hierarchy utilized to determine such fair value: September 30, 2016 Total Fair Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in millions) Cash equivalents $ 1,441 $ 1,441 $ — $ — Restricted cash 7 7 — — Derivative assets 5 — 5 — Nonqualified employee benefit trusts 19 19 — — Derivative liabilities (48 ) — (48 ) — Embedded derivative liability (30 ) — (30 ) — December 31, 2015 Total Fair Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in millions) Cash equivalents $ 215 $ 215 $ — $ — Restricted cash 23 23 — — Nonqualified employee benefit trusts 19 19 — — Derivative liabilities (211 ) — (211 ) — Cash Equivalents As of September 30, 2016 and December 31, 2015 , our 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 maintain a cash account for which the use of the funds is restricted. The restricted cash was put in place to satisfy certain requirements included in our engineering and procurement services contract for our capacity expansion projects. Under the terms of this contract, we granted an affiliate of ThyssenKrupp Industrial Solutions 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. Derivative Instruments The derivative instruments that we use are primarily natural gas fixed price swaps, natural gas options and foreign currency forward contracts traded in the over-the-counter (OTC) markets with multi-national commercial banks, other major financial institutions and large energy companies. The natural gas derivative contracts represent anticipated natural gas needs for future periods 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, Louisiana and Port Neal, Iowa capacity expansion projects. The natural gas derivative contracts settle using primarily 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 independent third party. The foreign currency derivatives are valued based on quoted market prices supplied by an industry-recognized independent third party. See Note 13—Derivative Financial Instruments for additional information. Embedded Derivative Liability Under the terms of our strategic venture with CHS Inc. (CHS), if our credit rating is reduced below certain levels by two of three specified credit ratings agencies, we are required to make a non-refundable yearly payment of $5 million to CHS. The payment would continue on a yearly basis until the earlier of the date that our credit rating is upgraded to or above certain levels by two of the three specified credit ratings agencies or February 1, 2026. On February 1, 2016, we recognized this term of the strategic venture as an embedded derivative and its value of $8 million was included in other liabilities on our consolidated balance sheet. See Note 14—Noncontrolling Interests for additional information. During the three months ended September 30, 2016 , we recorded an adjustment to increase the value of the embedded derivative liability by $22 million to $30 million to reflect our credit evaluation. The inputs into the fair value measurement include the probability of future upgrades and downgrades of the Company’s credit rating based on historical credit rating movements of other public companies and the discount rates to be applied to potential annual payments based on applicable credit spreads of other public companies at different credit rating levels. Based on these inputs, our fair value measurement is classified as Level 2. The $22 million charge to reflect the change in fair value is included in other operating—net in our consolidated statement of operations for the three and nine months ended September 30, 2016 . The embedded derivative liability of $30 million is included in other liabilities and other current liabilities on our consolidated balance sheet as of September 30, 2016 . Nonqualified Employee Benefit Trusts We maintain trusts associated with certain nonqualified supplemental pension plans. The investments are accounted for as available-for-sale securities. The fair values of the trust assets are based on daily quoted prices in an active market, which represents the net asset values of the shares held in the trusts. These trusts are included on our consolidated balance sheets in other assets. Financial Instruments The carrying amount and estimated fair value of our long-term debt is as follows: September 30, 2016 December 31, 2015 Carrying Amount Fair Value Carrying Amount Fair Value (in millions) Long-term debt $ 5,540 $ 5,810 $ 5,537 $ 5,456 The fair value of our long-term debt was based on either quoted prices for identical or similar liabilities in markets that are not active or valuation models in which all significant inputs and value drivers are observable and, as a result, are classified as Level 2 inputs. The carrying amounts of cash and cash equivalents, as well as instruments included in other current assets and other current liabilities that meet the definition of financial instruments, approximate fair values because of their short-term maturities. Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis We also have assets and liabilities that may be measured at fair value on a nonrecurring basis; that is, the assets and liabilities are not measured at fair value on an ongoing basis, but are subject to fair value adjustments in certain circumstances, such as when there is evidence of impairment, allocation of purchase price in an acquisition or when a new liability is being established that requires fair value measurement. These include long-lived assets, goodwill and other intangible assets and investments in unconsolidated subsidiaries which may be written down to fair value as a result of impairment. The fair value measurements related to each of these rely primarily on Company-specific inputs and the Company's assumptions about the use of the assets. Since certain of the Company’s assumptions would involve inputs that are not observable, these fair values would reside within Level 3 of the fair value hierarchy. We review the carrying value of our goodwill, definite lived intangible assets, and investments in affiliates to assess recoverability as part of our annual impairment review in the fourth quarter of each year. As part of the assessment process when performing impairment tests, we estimate many factors including future sales volume, selling prices, raw materials costs, operating rates, operating expenses, inflation, discount rates, exchange rates, tax rates and capital spending. The assumptions we make are material estimates that are used in the impairment testing. The current oversupply in the nitrogen fertilizer markets has led to a decline in selling prices, gross margin and profitability. These factors, as well as others, may have contributed to a potential decline in value for our reporting units that could result in an impairment charge. Our equity method investment in the Republic of Trinidad and Tobago, PLNL, operates an ammonia plant that relies on natural gas supplied, under a Gas Sales Contract (the NGC Contract), by The National Gas Company of Trinidad and Tobago Limited (NGC). See Note 8—Equity Method Investments for additional information. PLNL has continued to experience curtailments in the supply of natural gas from NGC, which has reduced the ammonia production at PLNL. NGC has communicated to PLNL that it does not recognize PLNL's exercise of its option to renew the NGC Contract for an additional five-year term beyond its current termination date in September 2018, and that any NGC commitment to supply gas beyond 2018 will need to be based on new agreements regarding volume and price. PLNL has initiated arbitration proceedings against NGC and asserted claims in connection with NGC’s failure to supply the contracted quantities of natural gas, and its refusal to recognize PLNL’s exercise of its option to extend the NGC Contract. PLNL is seeking declaratory and injunctive relief, as well as damages for past and ongoing curtailments. Although PLNL believes its claims against NGC to be meritorious, it is not possible to predict the outcome of the arbitration. The future availability of natural gas and the price of such gas are unclear at the present time. Natural gas is the principal raw material used to produce nitrogen fertilizers; therefore, a decrease in availability of natural gas leads to lower revenues and cash flows. In our fourth quarter 2015 impairment analysis, our assumptions included that similar curtailments were expected to continue into the foreseeable future, as commitments from NGC regarding the level of future availability and the related cost were not and are still not available. The future availability and cost of natural gas represents a significant assumption which is included in the projection of future revenue and expenses of the business used in the discounted cash flow model utilized to estimate fair value for our impairment analysis. In the fourth quarter of 2015, recognizing that natural gas curtailments were expected to continue into the foreseeable future, we determined the carrying value of our investment in PLNL exceeded fair value and recognized an impairment charge of $62 million . |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes For the three months ended September 30, 2016 , we recorded an income tax benefit of $131 million on a pre-tax loss of $131 million , compared to an income tax provision of $20 million on pre-tax income of $24 million for the three months ended September 30, 2015 . The income tax benefit of $131 million primarily relates to the fact that we are now projecting that full year 2016 pre-tax earnings, excluding the noncontrolling interests, will be a loss. As of June 30, 2016, we were projecting profit for the full year. The impact of this change in projected profitability was an income tax benefit of $163 million . In addition, other items included in our annualized effective tax rate that impacted the income tax benefit recorded in the third quarter of 2016 were, as follows: • We recorded income tax expense of $42 million related to the reversal of prior year U.S. manufacturing profits deductions due to the recapture of these benefits in the third quarter of 2016. The recapture results from our intention to carry back certain tax losses to prior years that will reduce the amount of the prior year U.S. manufacturing profits deduction that can be claimed. • We recorded a valuation allowance of $21 million against certain foreign deferred tax assets which increased income tax expense. • We recorded an income tax benefit of $9 million related to the impact of certain transaction costs which were treated as not being deductible for tax purposes in the prior year and are now tax deductible as a result of the termination of the proposed combination with certain businesses of OCI. See Note 3—Acquisitions for additional information. Our effective tax rate is also impacted by earnings attributable to noncontrolling interests in CF Industries Nitrogen LLC (CFN) and Terra Nitrogen Company L.P. (TNCLP), as our consolidated income tax provision does not include a tax provision on the earnings attributable to the noncontrolling interest. Earnings attributable to noncontrolling interests increased in 2016 due to our strategic venture with CHS that commenced on February 1, 2016, at which time CHS purchased a noncontrolling equity interest in CFN. See Note 14—Noncontrolling Interests for additional information. During the third quarter of 2016, one of our Canadian subsidiaries received a Notice of Reassessment from the Canada Revenue Agency (CRA) for tax years 2006 through 2009 asserting a disallowance of certain patronage allocations. The tax assessment of $88 million plus interest and penalties of $31 million does not include provincial taxes which have not yet been reassessed. This audit was initiated by the CRA in January 2010 and involves the sole issue of whether certain patronage allocations meet the requirements for deductibility under the Income Tax Act of Canada. We intend to appeal this reassessment and we believe that it is more likely than not that the patronage allocation deduction will be sustained on audit. In the event that we do not prevail in the appeal, we should be entitled to a U.S. foreign tax credit against any incremental Canadian tax paid. During the third quarter of 2015, we completed the acquisition of the remaining 50% equity interest in CF Fertilisers UK not previously owned by us and recognized a $94 million gain on the remeasurement to fair value of our initial 50% equity interest in CF Fertilisers UK. The earnings of CF Fertilisers UK have been treated as being permanently reinvested. Therefore, the recognition of the $94 million gain on the remeasurement of the historical equity investment does not include the recognition of tax expense on the gain. As of September 30, 2016 , we have prepaid income taxes in the amount of $830 million . This includes approximately $760 million from the carry back of certain U.S. tax losses from the current year to prior tax periods. The amount of the tax loss carryback could be impacted by the timing of the completion of certain capital projects before the end of 2016, including the completion of the Port Neal capacity expansion project. To the extent these projects are not completed prior to the end of 2016 our prepaid income tax amount could be reduced. |
Interest Expense
Interest Expense | 9 Months Ended |
Sep. 30, 2016 | |
Interest Expense [Abstract] | |
Interest Expense | Interest Expense Details of interest expense are as follows: Three months ended Nine months ended 2016 2015 2016 2015 (in millions) Interest on borrowings (1) $ 76 $ 65 $ 227 $ 192 Fees on financing agreements (1)(2)(3) 6 8 42 12 Interest on tax liabilities 2 1 3 2 Interest capitalized (53 ) (44 ) (142 ) (113 ) Total interest expense $ 31 $ 30 $ 130 $ 93 _______________________________________________________________________________ (1) See Note 12—Financing Agreements for additional information. (2) Fees on financing agreements for the nine months ended September 30, 2016 includes $28 million of fees related to the termination of the tranche B commitment under the bridge credit agreement as a result of the termination of the Combination Agreement. Fees on financing agreements for both the three and nine months ended September 30, 2015 includes $6 million of accelerated amortization of deferred fees related to the termination in September 2015 of the tranche A commitment under the bridge credit agreement. See Note 3—Acquisitions for additional information. (3) Fees on financing agreements for both the three and nine months ended September 30, 2016 includes $2 million of accelerated amortization of deferred fees related to the amendment of our senior unsecured revolving credit agreement which reduced the revolving credit facility to $1.5 billion from $2.0 billion . See Note 12—Financing Agreements for additional information. |
Financing Agreements
Financing Agreements | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Financing Agreements | Financing Agreements Revolving Credit Agreement We have a senior unsecured revolving credit agreement (as amended, including by an amendment effective July 29, 2016 that we refer to as the July 2016 Credit Agreement Amendment, the Revolving Credit Agreement) providing for a revolving credit facility of up to $1.5 billion (reflecting a reduction from $2.0 billion effected by the July 2016 Credit Agreement Amendment) with a maturity of September 18, 2020. The Revolving Credit Agreement includes a letter of credit sub-limit of $125 million (reflecting a reduction from $175 million effected by the July 2016 Credit Agreement Amendment). Borrowings under the Revolving Credit Agreement may be used for working capital and general corporate purposes. CF Industries is a borrower, and CF Industries and CF Holdings are guarantors, under the Revolving Credit Agreement. CF Industries may designate as borrowers one or more wholly owned subsidiaries that are organized in the United States or any state thereof, the District of Columbia, England and Wales or the Netherlands. Borrowings under the Revolving Credit Agreement may be denominated in dollars, Canadian dollars, euro and sterling, and bear interest at a per annum rate equal to an applicable eurocurrency rate or base rate plus, in either case, a specified margin, and the borrowers are required to pay an undrawn commitment fee on the undrawn portion of the commitments under the Revolving Credit Agreement and customary letter of credit fees. The specified margin and the amount of the commitment fee depend on CF Holdings’ credit rating at the time. Certain of CF Holdings’ wholly owned U.S. subsidiaries will be required to become guarantors of the obligations under the Revolving Credit Agreement if (i) such subsidiaries guarantee other debt for borrowed money (subject to specified exceptions) of CF Holdings or CF Industries in an aggregate principal amount in excess of $500 million or (ii) such subsidiaries are borrowers under, issuers of, or guarantors of specified debt obligations of CF Holdings or CF Industries. The Revolving Credit Agreement contains customary representations and warranties and covenants for a financing of this type, including two financial maintenance covenants: • a requirement that the interest coverage ratio (as defined in the Revolving Credit Agreement) as of the last day of any fiscal quarter not be less than 2.75 to 1.00 and • a requirement that the total leverage ratio (as defined in the Revolving Credit Agreement) as of the last day of any fiscal quarter not be greater than ▪ 5.25 to 1.00 for the quarters ending September 30, 2016, December 31, 2016 and March 31, 2017; ▪ 5.00 to 1.00 for the quarter ending June 30, 2017; ▪ 4.75 to 1.00 for the quarter ending September 30, 2017; ▪ 4.00 to 1.00 for the quarter ending December 31, 2017; and ▪ 3.75 to 1.00 for the quarters ending after December 31, 2017. Immediately prior to the July 2016 Credit Agreement Amendment, the Revolving Credit Agreement had required that the total leverage ratio as of the last day of any fiscal quarter not be greater than 3.75 to 1.00 for all periods. As of September 30, 2016 , we were in compliance with all covenants under the Revolving Credit Agreement. The Revolving Credit Agreement contains events of default (with notice requirements and cure periods, as applicable) customary for a financing of this type, including, but not limited to, non-payment of principal, interest or fees; inaccuracy of representations and warranties in any material respect; and failure to comply with specified covenants. Upon the occurrence and during the continuance of an event of default under the Revolving Credit Agreement and after any applicable cure period, subject to specified exceptions, the administrative agent may, and at the request of the requisite lenders is required to, accelerate the loans under the Revolving Credit Agreement or terminate the lenders’ commitments under the Revolving Credit Agreement. As of September 30, 2016 , we had excess borrowing capacity under the Revolving Credit Agreement of $1,495 million (net of outstanding letters of credit of $5 million ). There were no borrowings outstanding under the Revolving Credit Agreement as of September 30, 2016 or December 31, 2015 . Maximum borrowings outstanding under the Revolving Credit Agreement during the nine months ended September 30, 2016 were $150 million . The weighted-average annual interest rate of borrowings under the Revolving Credit Agreement during the nine months ended September 30, 2016 was 1.85% . Maximum borrowings under the Revolving Credit Agreement during the nine months ended September 30, 2015 , were $367 million with a weighted-average annual interest rate of 1.47% . See Note 19—Subsequent Events for additional information regarding the Revolving Credit Agreement. Public Senior Notes and Private Senior Notes Long-term debt presented on our consolidated balance sheets as of September 30, 2016 and December 31, 2015 consisted of the following unsecured senior notes: Effective Interest Rate September 30, December 31, Principal Carrying Amount (1) Principal Carrying Amount (1)(2) (in millions) Public Senior Notes: 6.875% due 2018 7.344% $ 800 $ 794 $ 800 $ 792 7.125% due 2020 7.529% 800 790 800 788 3.450% due 2023 3.562% 750 745 750 745 5.150% due 2034 5.279% 750 739 750 739 4.950% due 2043 5.031% 750 741 750 741 5.375% due 2044 5.465% 750 740 750 740 Private Senior Notes: 4.490% due 2022 4.664% 250 248 250 248 4.930% due 2025 5.061% 500 495 500 496 5.030% due 2027 5.145% 250 248 250 248 Total long-term debt $ 5,600 $ 5,540 $ 5,600 $ 5,537 _______________________________________________________________________________ (1) Carrying amount is net of unamortized debt discount and deferred debt issuance costs. Total unamortized debt discount was $7 million as of both September 30, 2016 and December 31, 2015 , and total deferred debt issuance costs were $52 million and $56 million as of September 30, 2016 and December 31, 2015 , respectively. (2) In connection with our adoption of ASU No. 2015-03, Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs, carrying amounts as of December 31, 2015 have been retrospectively adjusted to include a direct deduction of deferred debt issuance costs of $56 million . Prior to the adoption, these costs were included in other assets on our consolidated balance sheets. See Note 2—New Accounting Standards for additional information. Public Senior Notes Under the indentures (including the applicable supplemental indentures) governing the senior notes due 2018, 2020, 2023, 2034, 2043 and 2044 identified in the table above (the Public Senior Notes), each series of Public Senior Notes is guaranteed by CF Holdings. Interest on the Public Senior Notes is paid semiannually, and the Public Senior 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 Public Senior Notes contain customary events of default (including cross-default triggered by acceleration of, or a principal payment default that is not cured within an applicable grace period under, other debt having a principal amount of $150 million or more) and covenants that limit, among other things, the ability of CF Holdings and its subsidiaries, including CF Industries, to incur liens on certain properties to secure debt. If a Change of Control occurs together with a Ratings Downgrade (as both terms are defined under the indentures governing the Public Senior Notes), CF Industries would be required to offer to repurchase each series of Public Senior Notes at a price equal to 101% of the principal amount thereof, plus accrued and unpaid interest. In addition, in the event that a subsidiary of CF Holdings, other than CF Industries, becomes a borrower or a guarantor under the Revolving Credit Agreement (or any renewal, replacement or refinancing thereof), such subsidiary would be required to become a guarantor of the Public Senior Notes, provided that such requirement will no longer apply with respect to the Public Senior Notes due in 2023, 2034, 2043 and 2044 following the repayment of the Public Senior Notes due in 2018 and 2020 or the subsidiaries of ours, other than CF Industries, otherwise becoming no longer subject to such a requirement to guarantee the Public Senior Notes due in 2018 and 2020. Private Senior Notes The senior notes due 2022, 2025 and 2027 (the Private Senior Notes), issued by CF Industries on September 24, 2015, are governed by the terms of a note purchase agreement (as amended, including by an amendment effective September 7, 2016 that we refer to as the September 2016 NPA Amendment, the Note Purchase Agreement). Interest on the Private Senior Notes is payable semiannually on April 15 and October 15. The Private Senior Notes are guaranteed by CF Holdings. All obligations under the Note Purchase Agreement are unsecured. Under the terms of the Note Purchase Agreement, CF Industries may prepay at any time all, or from time to time any part of, any series of the Private Senior Notes, in an amount not less than 5% of the aggregate principal amount of such series of the Private Senior Notes then outstanding in the case of a partial prepayment, at 100% of the principal amount so prepaid plus a make-whole amount determined as specified in the Note Purchase Agreement. In the event of a Change in Control (as defined in the Note Purchase Agreement), each holder of the Private Senior Notes may require CF Industries to prepay the entire unpaid principal amount of the Private Senior Notes held by such holder at a price equal to 100% of the principal amount of such Private Senior Notes together with accrued and unpaid interest thereon, but without any make-whole amount or other premium. The Note Purchase Agreement contains customary representations and warranties and covenants for a financing of this type, including two financial maintenance covenants: • a requirement that the interest coverage ratio (as defined in the Note Purchase Agreement) as of the last day of any fiscal quarter not be less than 2.75 to 1.00 and • a requirement that the total leverage ratio (as defined in the Note Purchase Agreement) as of the last day of any fiscal quarter not be greater than ▪ 5.25 to 1.00 for the quarters ending September 30, 2016, December 31, 2016 and March 31, 2017; ▪ 5.00 to 1.00 for the quarter ending June 30, 2017; ▪ 4.75 to 1.00 for the quarter ending September 30, 2017; ▪ 4.00 to 1.00 for the quarter ending December 31, 2017; and ▪ 3.75 to 1.00 for the quarters ending after December 31, 2017. Immediately prior to the September 2016 NPA Amendment, the Note Purchase Agreement had required that the total leverage ratio as of the last day of any fiscal quarter not be greater than 3.75 to 1.00 for all periods. As of September 30, 2016 , we were in compliance with all covenants under the Note Purchase Agreement. The Note Purchase Agreement provides for a fee (the Elevated Leverage Ratio Fee) to be paid by CF Industries to the holders of the Private Senior Notes with respect to each quarter ending on or prior to December 31, 2017 for which the total leverage ratio is greater than 3.75 to 1.00 as follows: if the total leverage ratio for the applicable quarter is greater than 3.75 to 1.00 but less than or equal to 4.50 to 1.00, the Elevated Leverage Ratio Fee for that quarter will be 0.125% of the aggregate outstanding principal amount of the Private Senior Notes; and if the total leverage ratio for the applicable quarter is greater than 4.50 to 1.00, the Elevated Leverage Ratio Fee will be 0.25% of the aggregate outstanding principal amount of the Private Senior Notes. For the quarter ended September 30, 2016, we did not incur this fee as our total leverage ratio was less than 3:75 to 1.00. The Note Purchase Agreement requires that CF Industries, beginning December 31, 2016, obtain and maintain a credit rating with respect to the Private Senior Notes. If the rating so requested and obtained by CF Industries is not investment grade as of any interest payment date with respect to the Private Senior Notes prior to the later of April 15, 2018 or the first interest payment date thereafter on which the rating requested and obtained by CF Industries is investment grade, CF Industries will be required to pay holders of the Private Senior Notes a fee of 0.75% of the aggregate outstanding principal amount of the Private Senior Notes. The Note Purchase Agreement includes a most favored lender provision under which the financial covenants in the Note Purchase Agreement would generally incorporate automatically any changes to the analogous financial covenants in the Revolving Credit Agreement (or any amendment or replacement of that agreement) made until the first date after March 31, 2018 on which the requisite credit rating with respect to the Private Senior Notes is investment grade and CF Industries is in compliance with the financial covenants in the Note Purchase Agreement, if those changes as so incorporated would be beneficial to the holders of the Private Senior Notes. The Note Purchase Agreement contains events of default (with notice requirements and cure periods, as applicable) customary for a financing of this type, including, but not limited to, non-payment of principal, make-whole amounts, or interest; inaccuracy of representations and warranties in any material respect; and failure to comply with specified covenants. Upon the occurrence and during the continuance of an event of default under the Note Purchase Agreement and after any applicable cure period, subject to specified exceptions, the holder or holders of more than 50% in principal amount of the Private Senior Notes outstanding may declare all the Private Senior Notes then outstanding due and payable. See Note 19—Subsequent Events for additional information regarding the Private Senior Notes. Bridge Credit Agreement On September 18, 2015, in connection with our proposed combination with certain businesses of OCI (see Note 3—Acquisitions for additional information), CF Holdings and CF Industries entered into a senior unsecured 364 -Day Bridge Credit Agreement (as amended, the Bridge Credit Agreement). Upon the termination of the Combination Agreement on May 22, 2016, the lenders’ commitments under the Bridge Credit Agreement terminated automatically. There were no borrowings under the Bridge Credit Agreement. See Note 11—Interest Expense for additional information. |
Derivative Financial Instrument
Derivative Financial Instruments | 9 Months Ended |
Sep. 30, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | 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 products. We manage the risk of changes in natural gas prices primarily through the use of derivative financial instruments. The derivatives that we use for this purpose are primarily natural gas fixed price swaps and natural gas options traded in the 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. We enter into natural gas derivative contracts with respect to natural gas to be consumed by us in the future, and settlements of those derivative contracts are scheduled to coincide with our anticipated purchases of natural gas used to manufacture nitrogen products during those future periods. We use natural gas derivatives as an economic hedge of natural gas price risk, but without the application of hedge accounting. As a result, changes in fair value of these contracts are recognized in earnings. As of September 30, 2016 , we have natural gas derivative contracts covering periods through the end of 2018. As of September 30, 2016 and December 31, 2015 , we had open natural gas derivative contracts for 247.2 million MMBtus (millions of British thermal units) and 431.5 million MMBtus, respectively. For the nine months ended September 30, 2016 , we used derivatives to cover approximately 86% of our natural gas consumption. Foreign Currency Exchange Rates A portion of the costs for our capacity expansion projects at our Donaldsonville, Louisiana complex and Port Neal, Iowa complex 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 the end of 2016 using foreign currency forward contracts. As of September 30, 2016 and December 31, 2015 , the notional amount of our open foreign currency derivatives was €50 million and €89 million , respectively. None of these open foreign currency derivatives were designated as hedging instruments for accounting purposes. As of September 30, 2016 , accumulated other comprehensive income includes $7 million of pre-tax gains related to foreign currency derivatives that were originally designated as cash flow hedges. The hedges were de-designated as of December 31, 2013. The remaining balance in accumulated other comprehensive income is being reclassified into income over the depreciable lives of the property, plant and equipment associated with the capacity expansion projects. The amounts recognized during the three and nine months ended September 30, 2016 were insignificant. We expect that the amounts to be reclassified within the next twelve months will be insignificant. The effect of derivatives in our consolidated statements of operations is shown in the table below. Unrealized gain (loss) recognized in income Three months ended Location 2016 2015 (in millions) Natural gas derivatives Cost of sales $ (21 ) $ (126 ) Foreign currency derivatives Other operating—net — 13 Unrealized losses recognized in income $ (21 ) $ (113 ) Gain (loss) in income Three months ended All Derivatives 2016 2015 (in millions) Unrealized net losses $ (21 ) $ (113 ) Realized net losses (10 ) (16 ) Net derivative losses $ (31 ) $ (129 ) Unrealized gain (loss) recognized in income Nine months ended Location 2016 2015 (in millions) Natural gas derivatives Cost of sales $ 169 $ (79 ) Foreign currency derivatives Other operating—net (1 ) 16 Unrealized gains recognized in income (losses) $ 168 $ (63 ) Gain (loss) in income Nine months ended All Derivatives 2016 2015 (in millions) Unrealized net gains (losses) $ 168 $ (63 ) Realized net losses (125 ) (75 ) Net derivative gains (losses) $ 43 $ (138 ) The fair values of derivatives on our consolidated balance sheets are shown below. As of September 30, 2016 and December 31, 2015 , none of our derivative instruments were designated as hedging instruments. For additional information on derivative fair values, see Note 9—Fair Value Measurements . Asset Derivatives Liability Derivatives Balance Sheet Location September 30, December 31, Balance Sheet Location September 30, December 31, (in millions) (in millions) Foreign currency derivatives Other current assets $ — $ — Other current liabilities $ (1 ) $ — Foreign currency derivatives Other assets — — Other liabilities — — Natural gas derivatives Other current assets 4 — Other current liabilities (30 ) (130 ) Natural gas derivatives Other assets 1 — Other liabilities (17 ) (81 ) Total derivatives $ 5 $ — $ (48 ) $ (211 ) Current / Noncurrent totals Other current assets $ 4 $ — Other current liabilities $ (31 ) $ (130 ) Other assets 1 — Other liabilities (17 ) (81 ) Total derivatives $ 5 $ — $ (48 ) $ (211 ) As of September 30, 2016 and December 31, 2015 , the aggregate fair value of the derivative instruments with credit-risk-related contingent features in net liability positions was $43 million and $211 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, 2016 and December 31, 2015 , we had no cash collateral on deposit with counterparties for derivative contracts. The credit support documents executed in connection with certain of our International Swaps and Derivatives Association (ISDA) agreements generally provide us and our counterparties the right to set off 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 as of September 30, 2016 and December 31, 2015 : Amounts presented in consolidated balance sheets (1) Gross amounts not offset in consolidated balance sheets Financial instruments Cash collateral received (pledged) Net amount (in millions) September 30, 2016 Total derivative assets $ 5 $ 5 $ — $ — Total derivative liabilities 48 5 — 43 Net derivative liabilities $ (43 ) $ — $ — $ (43 ) December 31, 2015 Total derivative assets $ — $ — $ — $ — Total derivative liabilities 211 — — 211 Net derivative liabilities $ (211 ) $ — $ — $ (211 ) _______________________________________________________________________________ (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. We do not believe the contractually allowed netting, close-out netting or setoff of amounts owed to, or due from, the counterparties to our ISDA agreements would have a material effect on our consolidated financial position. |
Noncontrolling Interests
Noncontrolling Interests | 9 Months Ended |
Sep. 30, 2016 | |
Noncontrolling Interest [Abstract] | |
Noncontrolling Interests | Noncontrolling Interests A reconciliation of the beginning and ending balances of noncontrolling interests and distributions payable to noncontrolling interests in our consolidated balance sheets is provided below. Nine months ended 2016 2015 CFN TNCLP Total TNCLP (in millions) Noncontrolling interests: Beginning balance $ — $ 352 $ 352 $ 363 Issuance of noncontrolling interest in CFN 2,792 — 2,792 — Earnings attributable to noncontrolling interests 67 20 87 25 Declaration of distributions payable (79 ) (32 ) (111 ) (32 ) Ending balance $ 2,780 $ 340 $ 3,120 $ 356 Distributions payable to noncontrolling interests: Beginning balance $ — $ — $ — $ — Declaration of distributions payable 79 32 111 32 Distributions to noncontrolling interests (79 ) (32 ) (111 ) (32 ) Ending balance $ — $ — $ — $ — CF Industries Nitrogen, LLC (CFN) Our strategic venture with CHS commenced on February 1, 2016, at which time CHS purchased a minority equity interest in CFN, a subsidiary of CF Holdings, for $2.8 billion . For financial reporting purposes, the assets, liabilities and earnings of the strategic venture are consolidated into our financial statements. The outside member's interest in the strategic venture is recorded in noncontrolling interest in our consolidated financial statements. CHS also began receiving deliveries pursuant to a supply agreement under which CHS has the right to purchase annually from CFN up to approximately 1.1 million tons of granular urea and 580,000 tons of UAN at market prices. As a result of its minority equity interest in CFN, CHS is entitled to semi-annual cash distributions from CFN. We are also entitled to semi-annual cash distributions from CFN. The amounts of distributions from CFN to us and CHS are based generally on the profitability of CFN and determined based on the volume of granular urea and UAN sold by CFN to us and CHS pursuant to supply agreements, less a formula driven amount based primarily on the cost of natural gas used to produce the granular urea and UAN, and adjusted for the allocation of items such as operational efficiencies and overhead amounts. Additionally, under the terms of the strategic venture, if our credit rating is reduced below certain levels by two of three specified credit ratings agencies, we are required to make a non-refundable yearly payment of $5 million to CHS. The payment would continue on a yearly basis until the earlier of the date that our credit rating is upgraded to or above certain levels by two of the three specified credit ratings agencies or February 1, 2026. On February 1, 2016, we recognized this term of the strategic venture as an embedded derivative and its value of $8 million was included in other liabilities on our consolidated balance sheet. During the three months ended September 30, 2016 , we recorded an adjustment to the value of the embedded derivative liability by $22 million to $30 million to reflect our credit evaluation. See Note 9—Fair Value Measurements for additional information. Terra Nitrogen Company L.P. (TNCLP) TNCLP is a master limited partnership (MLP) 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 are recorded in noncontrolling interest in our consolidated financial statements. The noncontrolling interest represents the noncontrolling unitholders' interest in the earnings and equity of TNCLP. Affiliates of CF Industries are 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. 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 affect available cash, as increases in the amount of cash invested in working capital items (such as increases in inventory and decreases in accounts payable) reduce available cash, while declines in the amount of cash invested in working capital items 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 2016 and 2015 , 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, 2016 and 2015 , were $56 million and $83 million , respectively. As of September 30, 2016 , 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. Proposed Internal Revenue Service Regulation Impacting Master Limited Partnerships Currently, no federal income taxes are paid by TNCLP due to its MLP status. Partnerships are generally not subject to federal income tax, although publicly traded partnerships (such as TNCLP) are treated as corporations for federal income tax purposes (and therefore are subject to federal income tax), unless at least 90% of the partnership's gross income is "qualifying income" as defined in Section 7704 of the Internal Revenue Code of 1986, as amended, and the partnership is not required to register as an investment company under the Investment Company Act of 1940. Any change in the tax treatment of income from fertilizer-related activities as qualifying income could cause TNCLP to be treated as a corporation for federal income tax purposes. If TNCLP were taxed as a corporation, under current law, due to its current ownership interest, CF Industries would qualify for a partial dividends received deduction on the dividends received from TNCLP. Therefore, we would not expect a change in the tax treatment of TNCLP to have a material impact on the consolidated financial condition or results of operations of CF Holdings. On May 6, 2015, the Internal Revenue Service (IRS) published proposed regulations on the types of income and activities that constitute or generate qualifying income of an MLP. The proposed regulations would have the effect of limiting the types of income and activities that qualify under the MLP rules, subject to certain transition provisions. The proposed regulations include certain processing or refining and transportation activities with respect to any mineral or natural resource (including fertilizer) as activities that generate qualifying income, but the proposed regulations reserve on specific proposals regarding fertilizer-related activities. We continue to monitor these IRS regulatory activities. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2016 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders' Equity Accumulated Other Comprehensive Income (Loss) Changes to accumulated other comprehensive income (loss) 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 as of December 31, 2014 $ (41 ) $ 1 $ 5 $ (125 ) $ (160 ) Unrealized loss — (1 ) — — (1 ) Loss arising during the period — — — (4 ) (4 ) Reclassification to earnings — — — 5 5 Impact of CF Fertilisers UK acquisition 9 — — 38 47 Effect of exchange rate changes and deferred taxes (109 ) — — 8 (101 ) Balance as of September 30, 2015 $ (141 ) $ — $ 5 $ (78 ) $ (214 ) Balance as of December 31, 2015 $ (198 ) $ 1 $ 5 $ (58 ) $ (250 ) Loss arising during the period — — — (3 ) (3 ) Effect of exchange rate changes and deferred taxes (20 ) — — — (20 ) Balance as of September 30, 2016 $ (218 ) $ 1 $ 5 $ (61 ) $ (273 ) Reclassifications out of accumulated other comprehensive income (loss) to earnings during the three and nine months ended September 30, 2016 and 2015 were as follows: Three months ended Nine months ended 2016 2015 2016 2015 (in millions) Foreign Currency Translation Adjustment CF Fertilisers UK equity method investment remeasurement (1) $ — $ 9 $ — $ 9 Total before tax — 9 — 9 Tax effect — — — — Net of tax $ — $ 9 $ — $ 9 Defined Benefit Plans Amortization of prior service (benefit) cost (2) $ (1 ) $ — $ (1 ) $ (1 ) CF Fertilisers UK equity method investment remeasurement (1) — 38 — 38 Amortization of net loss (2) 1 2 1 6 Total before tax — 40 — 43 Tax effect — (1 ) — (2 ) Net of tax $ — $ 39 $ — $ 41 Total reclassifications for the period $ — $ 48 $ — $ 50 _______________________________________________________________________________ (1) Represents the amount that was reclassified from accumulated other comprehensive income (loss) into equity in earnings of non-operating affiliates—net of taxes as a result of the remeasurement to fair value of our initial 50% equity interest in CF Fertilisers UK. (2) These components are included in the computation of net periodic pension cost and were reclassified from accumulated other comprehensive income (loss) into cost of sales and selling, general and administrative expenses. Preferred Stock CF Holdings is authorized to issue 50 million shares of $0.01 par value preferred stock. Our Second Amended and Restated Certificate of Incorporation, as amended, authorizes our Board of Directors (the Board), without any further stockholder action or approval, to issue these shares in one or more classes or series, and (except in the case of our Series A Junior Participating Preferred Stock, 500,000 shares of which are authorized and the terms of which were specified in the original certificate of incorporation of CF Holdings) to fix the rights, preferences and privileges of the shares of each wholly unissued class or series and any of its qualifications, limitations or restrictions. In connection with the Plan (as defined below), 500,000 shares of preferred stock have been designated as Series B Junior Participating Preferred Stock. The Series A Junior Participating Preferred Stock had been established in CF Holdings’ original certificate of incorporation in connection with our former stockholder rights plan that expired in 2015. No shares of preferred stock have been issued. Tax Benefits Preservation Plan On September 6, 2016, CF Holdings entered into a Tax Benefits Preservation Plan (the Plan) with Computershare Trust Company, N.A., as rights agent. The Plan is intended to help protect our tax net operating losses and certain other tax assets (the Tax Benefits) by deterring any person from becoming a "5-percent shareholder" (as defined in Section 382 of the Internal Revenue Code of 1986, as amended) (a 5% Shareholder). Under the Plan, each share of common stock has attached to it one right. Each right entitles the holder to purchase one one-thousandth of a share of our preferred stock designated as Series B Junior Participating Preferred Stock at a purchase price of $100, subject to adjustment. Rights will only be exercisable under the limited circumstances specified in the Plan when there has been a distribution of the rights and such rights are no longer redeemable by CF Holdings. A distribution of the rights would occur upon the earlier of (i) 10 business days following a public announcement that a person or group of affiliated or associated persons has become a 5% Shareholder (subject to certain exceptions described in the Plan) and (ii) 10 business days (or such later date as the Board shall determine) following the commencement of a tender offer or exchange offer that would result in a person or group of affiliated or associated persons becoming a 5% Shareholder (subject to certain exceptions described in the Plan). The rights will expire at the earliest of (i) 5:00 P.M. (New York City time) on September 5, 2017, or such later date and time (but not later than 5:00 P.M. (New York City time) on September 5, 2019) as may be determined by the Board and approved by the stockholders of CF Holdings by a vote of the majority of the votes cast by the holders of shares entitled to vote thereon at a meeting of the stockholders of CF Holdings prior to 5:00 P.M. (New York City time) on September 5, 2017, (ii) the time at which the rights are redeemed or exchanged as provided in the Plan, (iii) the time at which the Board determines that the Plan is no longer necessary or desirable for the preservation of Tax Benefits, and (iv) the close of business on the first day of a taxable year of CF Holdings to which the Board determines that no Tax Benefits may be carried forward. In the event that a person or group of affiliated or associated persons becomes a 5% Shareholder (subject to certain exceptions described in the Plan), each holder of a right, other than such person, any member of such group or related person, all of whose rights will be null and void, will thereafter have the right to receive, upon exercise, common stock having a value equal to two times the exercise price of the right. If we are involved in certain merger or other business combination transactions, each right will entitle its holder to receive, after exercise, a number of shares of the acquiring or surviving company's common stock having a value equal to two times the exercise price of the right. The description and terms of the rights are set forth in the Plan. Treasury Stock On August 6, 2014, the Board authorized a program to repurchase up to $1.0 billion of the common stock of CF Holdings through December 31, 2016. Repurchases under this program may be made from time to time in the open market, through privately negotiated transactions, through block transactions or otherwise. The manner, timing and amount of repurchases are determined by our management based on the evaluation of market conditions, stock price and other factors. No share repurchases were made during the nine months ended September 30, 2016 . During the three and nine months ended September 30, 2015 , we repurchased 0.3 million shares for $22 million and 8.9 million shares for $527 million , respectively. To date under this program, 15.9 million shares have been repurchased for an aggregate expenditure of $900 million . During the nine months ended September 30, 2015 , we retired 10.7 million shares of repurchased stock. No shares of repurchased stock were retired during the nine months ended September 30, 2016 . |
Contingencies
Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies Litigation West Fertilizer Co. On April 17, 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. Various subsidiaries of CF Holdings (the CF Entities) have been named as defendants along with other companies in lawsuits filed in 2013, 2014 and 2015 in the District Court of McLennan County, Texas by the City of West, individual residents of the County and other parties seeking recovery for damages allegedly sustained as a result of the explosion. The cases have been consolidated for discovery and pretrial proceedings in the District Court of McLennan County under the caption "In re: West Explosion Cases." The two-year statute of limitations expired on April 17, 2015. As of that date, over 400 plaintiffs had filed claims, including at least 9 entities, 325 individuals, and 80 insurance companies. 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 products to West Fertilizer Co., products that the CF Entities 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. The Court granted in part and denied in part the CF Entities' Motions for Summary Judgment in August 2015. Thirty-four cases have been resolved pursuant to confidential settlements fully funded by insurance. The remaining cases are in various stages of discovery and pre-trial proceedings. The next group of cases is set for trial beginning on January 9, 2017. While we believe we have strong legal and factual defenses and intend to continue defending the CF Entities vigorously in the pending lawsuits, including in any appeals that may follow, we have concluded based on continuing developments in the case that some loss is probable for a subset of the outstanding claims. We have made an accrual for this subset of the outstanding claims, which is not material to the Consolidated Financial Statements. Beyond the amounts accrued, the Company cannot provide a range of reasonably possible loss due to the lack of damages discovery for the remaining claims and the uncertain nature of this litigation, including uncertainties around the potential allocation of responsibility by a jury to other defendants or responsible third parties. The recognition of a potential loss in the future in the West Fertilizer Co. litigation could negatively affect our results in the period of recognition. However, based upon currently available information, including available insurance coverage, we do not believe that this litigation will have a material adverse effect on our consolidated financial position, results of operations or cash flows. 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, 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 routine matters will not have a material adverse effect on our consolidated financial position, results of operations or cash flows. Environmental 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 complex) 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 Environmental Protection Agency (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 us 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. The 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 the 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 compliance with the Act cannot be determined at this time, and we cannot reasonably estimate the impact on our consolidated financial position, results of operations or cash flows. Furthermore, the Baton Rouge area has seen significant reductions in ozone levels, attributable to federal and state regulations and community involvement. On May 4, 2016, the EPA determined that the Baton Rouge nonattainment area had complied with the obligation to achieve attainment with the 2008 8-hour ozone standard by the July 20, 2015 deadline. The EPA stated that additional statutory criteria must be met before the area would be redesignated to attainment. However, even if these additional requirements are satisfied, a more stringent national ambient air quality standard for ozone published by the EPA on October 1, 2015 could cause Baton Rouge to again be classified as a nonattainment area. Clean Air Act Information Request On February 26, 2009, we 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. We have 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 site. In 2014, we and the current property owner entered into a Consent Order with IDEQ and the U.S. Forest Service to conduct a remedial investigation and feasibility study of the site. In 2015, we and several other parties received a notice that the U.S. Department of the Interior and other trustees intend to undertake a natural resource damage assessment for a group of former phosphate mines in southeast Idaho, including the former Georgetown Canyon mine. We are not able to estimate at this time our potential liability, if any, with respect to the cleanup of the former mine site or a possible claim for natural resource damages. However, based on currently available information, we do not expect the remedial or financial obligations to which we may be subject involving this or other known cleanup sites will have a material adverse effect on our consolidated financial position, results of operations or cash flows. |
Segment Disclosures
Segment Disclosures | 9 Months Ended |
Sep. 30, 2016 | |
Segment Reporting [Abstract] | |
Segment Disclosures | Segment Disclosures Our reportable segments consist of ammonia, granular urea, UAN, AN and Other. These segments are differentiated by products. Our 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. Our assets, with the exception of goodwill, are not monitored by or reported to our chief operating decision maker by segment; therefore, we do not present total assets by segment. Goodwill by segment is presented in Note 7—Goodwill and Other Intangible Assets . Segment data for sales, cost of sales and gross margin for the three and nine months ended September 30, 2016 and 2015 are presented in the tables below. Ammonia Granular (1) UAN (1) AN (1) Other (1) Consolidated (in millions) Three months ended September 30, 2016 Net sales $ 145 $ 167 $ 212 $ 103 $ 53 $ 680 Cost of sales 149 152 218 114 45 678 Gross margin $ (4 ) $ 15 $ (6 ) $ (11 ) $ 8 2 Total other operating costs and expenses 101 Equity in losses of operating affiliates (2 ) Operating loss $ (101 ) Three months ended September 30, 2015 Net sales $ 261 $ 171 $ 349 $ 80 $ 67 $ 928 Cost of sales 207 132 276 97 51 763 Gross margin $ 54 $ 39 $ 73 $ (17 ) $ 16 165 Total other operating costs and expenses 112 Equity in earnings of operating affiliates 6 Operating earnings $ 59 Ammonia Granular Urea (1) UAN (1) AN (1) Other (1) Consolidated (in millions) Nine months ended September 30, 2016 Net sales $ 770 $ 642 $ 891 $ 318 $ 197 $ 2,818 Cost of sales 505 445 646 316 160 2,072 Gross margin $ 265 $ 197 $ 245 $ 2 $ 37 746 Total other operating costs and expenses 501 Equity in losses of operating affiliates (11 ) Operating earnings $ 234 Nine months ended September 30, 2015 Net sales $ 1,148 $ 594 $ 1,112 $ 179 $ 160 $ 3,193 Cost of sales 635 324 678 179 110 1,926 Gross margin $ 513 $ 270 $ 434 $ — $ 50 1,267 Total other operating costs and expenses 231 Equity in earnings of operating affiliates 20 Operating earnings $ 1,056 _______________________________________________________________________________ (1) The cost of the products that are upgraded into other products is transferred at cost into the upgraded product results. |
Condensed Consolidating Financi
Condensed Consolidating Financial Statements | 9 Months Ended |
Sep. 30, 2016 | |
Condensed Consolidating Financial Statements | |
Condensed Consolidating Financial Statements | Condensed Consolidating Financial Statements The following condensed consolidating financial statements are 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 Public Senior Notes issued by CF Industries, a 100% owned subsidiary of CF Industries Holdings, Inc. (Parent), described in Note 12—Financing Agreements , and the full and unconditional guarantee of such Public Senior 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 registration statements filed by Parent and CF Industries with the SEC. In the event that a subsidiary of Parent, other than CF Industries, becomes a borrower or a guarantor under the Revolving Credit Agreement (or any renewal, replacement or refinancing thereof), such subsidiary would be required to become a guarantor of the Public Senior Notes, provided that such requirement will no longer apply with respect to the Public Senior Notes due in 2023, 2034, 2043 and 2044 following the repayment of the Public Senior Notes due in 2018 and 2020 or the subsidiaries of Parent, other than CF Industries, otherwise becoming no longer subject to such a requirement to guarantee the Public Senior Notes due in 2018 and 2020. As of September 30, 2016 , none of such subsidiaries of Parent was, or was required to be, a guarantor of the Public Senior Notes. See Note 19—Subsequent Events for additional information regarding the Revolving Credit Agreement. 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, statements of comprehensive income and statements of cash flows for Parent, CF Industries and the Other Subsidiaries for the nine months ended September 30, 2016 and 2015 , and condensed consolidating balance sheets for Parent, CF Industries and the Other Subsidiaries as of September 30, 2016 and December 31, 2015 . The condensed consolidating financial statements presented below are 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 these condensed consolidating financial statements, 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. Condensed Consolidating Statement of Operations Three months ended September 30, 2016 Parent CF Industries Other Subsidiaries Eliminations Consolidated (in millions) Net sales $ — $ 80 $ 713 $ (113 ) $ 680 Cost of sales — 35 756 (113 ) 678 Gross margin — 45 (43 ) — 2 Selling, general and administrative expenses 1 4 39 — 44 Other operating—net — 5 52 — 57 Total other operating costs and expenses 1 9 91 — 101 Equity in loss of operating affiliates — — (2 ) — (2 ) Operating (loss) earnings (1 ) 36 (136 ) — (101 ) Interest expense — 86 (38 ) (17 ) 31 Interest income — (12 ) (7 ) 17 (2 ) Net loss of wholly owned subsidiaries 39 1 — (40 ) — Other non-operating—net — — 1 — 1 Loss before income taxes (40 ) (39 ) (92 ) 40 (131 ) Income tax benefit (10 ) — (121 ) — (131 ) Net (loss) earnings (30 ) (39 ) 29 40 — Less: Net earnings attributable to noncontrolling interests — — 30 — 30 Net loss attributable to common stockholders $ (30 ) $ (39 ) $ (1 ) $ 40 $ (30 ) Condensed Consolidating Statement of Comprehensive Income (Loss) Three months ended September 30, 2016 Parent CF Industries Other Subsidiaries Eliminations Consolidated (in millions) Net (loss) earnings $ (30 ) $ (39 ) $ 29 $ 40 $ — Other comprehensive loss (30 ) (30 ) (30 ) 60 (30 ) Comprehensive loss (60 ) (69 ) (1 ) 100 (30 ) Less: Comprehensive income attributable to noncontrolling interests — — 30 — 30 Comprehensive loss attributable to common stockholders $ (60 ) $ (69 ) $ (31 ) $ 100 $ (60 ) Condensed Consolidating Statement of Operations Nine months ended September 30, 2016 Parent CF Industries Other Subsidiaries Eliminations Consolidated (in millions) Net sales $ — $ 283 $ 2,942 $ (407 ) $ 2,818 Cost of sales — 161 2,318 (407 ) 2,072 Gross margin — 122 624 — 746 Selling, general and administrative expenses 3 8 130 — 141 Transaction costs (46 ) — 225 — 179 Other operating—net — 5 176 — 181 Total other operating costs and expenses (43 ) 13 531 — 501 Equity in loss of operating affiliates — — (11 ) — (11 ) Operating earnings 43 109 82 — 234 Interest expense — 248 (59 ) (59 ) 130 Interest income — (42 ) (21 ) 59 (4 ) Net earnings of wholly owned subsidiaries (16 ) (76 ) — 92 — Other non-operating—net — — (1 ) — (1 ) Earnings (loss) before income taxes 59 (21 ) 163 (92 ) 109 Income tax provision (benefit) 16 (37 ) — — (21 ) Net earnings 43 16 163 (92 ) 130 Less: Net earnings attributable to noncontrolling interests — — 87 — 87 Net earnings attributable to common stockholders $ 43 $ 16 $ 76 $ (92 ) $ 43 Condensed Consolidating Statement of Comprehensive Income (Loss) Nine months ended September 30, 2016 Parent CF Industries Other Subsidiaries Eliminations Consolidated (in millions) Net earnings $ 43 $ 16 $ 163 $ (92 ) $ 130 Other comprehensive loss (23 ) (23 ) (23 ) 46 (23 ) Comprehensive income (loss) 20 (7 ) 140 (46 ) 107 Less: Comprehensive income attributable to noncontrolling interests — — 87 — 87 Comprehensive income (loss) attributable to common stockholders $ 20 $ (7 ) $ 53 $ (46 ) $ 20 Condensed Consolidating Statement of Operations Three months ended September 30, 2015 Parent CF Industries Other Subsidiaries Eliminations Consolidated (in millions) Net sales $ — $ 78 $ 983 $ (133 ) $ 928 Cost of sales — 84 812 (133 ) 763 Gross margin — (6 ) 171 — 165 Selling, general and administrative expenses — 3 39 — 42 Transaction costs 30 — 7 — 37 Other operating—net — (4 ) 37 — 33 Total other operating costs and expenses 30 (1 ) 83 — 112 Equity in earnings of operating affiliates — — 6 — 6 Operating (loss) earnings (30 ) (5 ) 94 — 59 Interest expense — 74 (21 ) (23 ) 30 Interest income — (22 ) (1 ) 23 — Net earnings of wholly owned subsidiaries (109 ) (143 ) — 252 — Other non-operating—net — — 5 — 5 Earnings before income taxes and equity in earnings of non-operating affiliates 79 86 111 (252 ) 24 Income tax (benefit) provision (11 ) (24 ) 55 — 20 Equity in earnings of non-operating affiliates—net of taxes — — 93 — 93 Net earnings 90 110 149 (252 ) 97 Less: Net earnings attributable to noncontrolling interest — — 7 — 7 Net earnings attributable to common stockholders $ 90 $ 110 $ 142 $ (252 ) $ 90 Condensed Consolidating Statement of Comprehensive Income Three months ended September 30, 2015 Parent CF Industries Other Subsidiaries Eliminations Consolidated (in millions) Net earnings $ 90 $ 110 $ 149 $ (252 ) $ 97 Other comprehensive loss (7 ) (8 ) (9 ) 16 (8 ) Comprehensive income 83 102 140 (236 ) 89 Less: Comprehensive income attributable to noncontrolling interest — — 7 — 7 Comprehensive income attributable to common stockholders $ 83 $ 102 $ 133 $ (236 ) $ 82 Condensed Consolidating Statement of Operations Nine months ended September 30, 2015 Parent CF Industries Other Subsidiaries Eliminations Consolidated (in millions) Net sales $ — $ 270 $ 3,380 $ (457 ) $ 3,193 Cost of sales — 276 2,107 (457 ) 1,926 Gross margin — (6 ) 1,273 — 1,267 Selling, general and administrative expenses 2 4 114 — 120 Transaction costs 30 — 7 — 37 Other operating—net — (9 ) 83 — 74 Total other operating costs and expenses 32 (5 ) 204 — 231 Equity in earnings of operating affiliates — — 20 — 20 Operating (loss) earnings (32 ) (1 ) 1,089 — 1,056 Interest expense — 205 (74 ) (38 ) 93 Interest income — (37 ) (2 ) 38 (1 ) Net earnings of wholly owned subsidiaries (693 ) (800 ) — 1,493 — Other non-operating—net — — 5 — 5 Earnings before income taxes and equity in earnings of non-operating affiliates 661 631 1,160 (1,493 ) 959 Income tax (benefit) provision (12 ) (63 ) 408 — 333 Equity in earnings of non-operating affiliates—net of taxes — — 72 — 72 Net earnings 673 694 824 (1,493 ) 698 Less: Net earnings attributable to noncontrolling interest — — 25 — 25 Net earnings attributable to common stockholders $ 673 $ 694 $ 799 $ (1,493 ) $ 673 Condensed Consolidating Statement of Comprehensive Income Nine months ended September 30, 2015 Parent CF Industries Other Subsidiaries Eliminations Consolidated (in millions) Net earnings $ 673 $ 694 $ 824 $ (1,493 ) $ 698 Other comprehensive loss (53 ) (54 ) (54 ) 107 (54 ) Comprehensive income 620 640 770 (1,386 ) 644 Less: Comprehensive income attributable to noncontrolling interest — — 25 — 25 Comprehensive income attributable to common stockholders $ 620 $ 640 $ 745 $ (1,386 ) $ 619 Condensed Consolidating Balance Sheet September 30, 2016 Parent CF Industries Other Subsidiaries Eliminations and Reclassifications Consolidated (in millions) Assets Current assets: Cash and cash equivalents $ — $ 5 $ 1,549 $ — $ 1,554 Restricted cash — — 7 — 7 Accounts and notes receivable—net — 1,316 1,517 (2,626 ) 207 Inventories — — 312 — 312 Prepaid income taxes — — 830 — 830 Other current assets — — 21 — 21 Total current assets — 1,321 4,236 (2,626 ) 2,931 Property, plant and equipment—net — — 9,725 — 9,725 Investments in affiliates 4,156 9,632 287 (13,788 ) 287 Due from affiliates 571 — 2 (573 ) — Goodwill — — 2,359 — 2,359 Other assets — 18 312 — 330 Total assets $ 4,727 $ 10,971 $ 16,921 $ (16,987 ) $ 15,632 Liabilities and Equity Current liabilities: Accounts and notes payable and accrued expenses $ 867 $ 556 $ 2,046 $ (2,626 ) $ 843 Income taxes payable — — 1 — 1 Customer advances — — 86 — 86 Other current liabilities — — 36 — 36 Total current liabilities 867 556 2,169 (2,626 ) 966 Long-term debt — 5,540 — — 5,540 Deferred income taxes — 81 1,561 — 1,642 Due to affiliates — 573 — (573 ) — Other liabilities — 65 439 — 504 Equity: Stockholders' equity: Preferred stock — — 16 (16 ) — Common stock 2 — 1 (1 ) 2 Paid-in capital 1,390 (13 ) 9,936 (9,923 ) 1,390 Retained earnings 2,892 4,442 (48 ) (4,394 ) 2,892 Treasury stock (151 ) — — — (151 ) Accumulated other comprehensive loss (273 ) (273 ) (273 ) 546 (273 ) Total stockholders' equity 3,860 4,156 9,632 (13,788 ) 3,860 Noncontrolling interests — — 3,120 — 3,120 Total equity 3,860 4,156 12,752 (13,788 ) 6,980 Total liabilities and equity $ 4,727 $ 10,971 $ 16,921 $ (16,987 ) $ 15,632 Condensed Consolidating Balance Sheet December 31, 2015 Parent CF Industries Other Subsidiaries Eliminations and Reclassifications Consolidated (in millions) Assets Current assets: Cash and cash equivalents $ 1 $ — $ 285 $ — $ 286 Restricted cash — — 23 — 23 Accounts and notes receivable—net 1 2,987 1,565 (4,286 ) 267 Inventories — — 321 — 321 Prepaid income taxes — — 185 — 185 Other current assets — 24 21 — 45 Total current assets 2 3,011 2,400 (4,286 ) 1,127 Property, plant and equipment—net — — 8,539 — 8,539 Investments in affiliates 4,303 8,148 298 (12,451 ) 298 Due from affiliates 571 — 2 (573 ) — Goodwill — — 2,390 — 2,390 Other assets — 19 310 — 329 Total assets $ 4,876 $ 11,178 $ 13,939 $ (17,310 ) $ 12,683 Liabilities and Equity Current liabilities: Accounts and notes payable and accrued expenses $ 841 $ 648 $ 3,715 $ (4,286 ) $ 918 Income taxes payable — — 5 — 5 Customer advances — — 162 — 162 Other current liabilities — — 130 — 130 Total current liabilities 841 648 4,012 (4,286 ) 1,215 Long-term debt — 5,537 — — 5,537 Deferred income taxes — 52 864 — 916 Due to affiliates — 573 — (573 ) — Other liabilities — 66 562 — 628 Equity: Stockholders' equity: Preferred stock — — 17 (17 ) — Common stock 2 — 1 (1 ) 2 Paid-in capital 1,378 (13 ) 8,365 (8,352 ) 1,378 Retained earnings 3,058 4,565 16 (4,581 ) 3,058 Treasury stock (153 ) — — — (153 ) Accumulated other comprehensive loss (250 ) (250 ) (250 ) 500 (250 ) Total stockholders' equity 4,035 4,302 8,149 (12,451 ) 4,035 Noncontrolling interest — — 352 — 352 Total equity 4,035 4,302 8,501 (12,451 ) 4,387 Total liabilities and equity $ 4,876 $ 11,178 $ 13,939 $ (17,310 ) $ 12,683 Condensed Consolidating Statement of Cash Flows Nine months ended September 30, 2016 Parent CF Industries Other Subsidiaries Eliminations Consolidated (in millions) Operating Activities: Net earnings $ 43 $ 16 $ 163 $ (92 ) $ 130 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation and amortization — 9 466 — 475 Deferred income taxes — 29 701 — 730 Stock-based compensation expense 14 — 1 — 15 Unrealized gain on natural gas and foreign currency derivatives — — (169 ) — (169 ) Unrealized loss on embedded derivative — — 22 — 22 Loss on disposal of property, plant and equipment — — 8 — 8 Undistributed earnings of affiliates—net (16 ) (76 ) — 92 — Changes in: Accounts and notes receivable—net 1 178 (61 ) (63 ) 55 Inventories — — (4 ) — (4 ) Accrued and prepaid income taxes — — (665 ) — (665 ) Accounts and notes payable and accrued expenses (9 ) (34 ) (27 ) 63 (7 ) Customer advances — — (75 ) — (75 ) Other—net — — 76 — 76 Net cash provided by operating activities 33 122 436 — 591 Investing Activities: Additions to property, plant and equipment — — (1,819 ) — (1,819 ) Proceeds from sale of property, plant and equipment — — 8 — 8 Withdrawals from restricted cash funds — — 16 — 16 Other—net — — 4 — 4 Net cash used in investing activities — — (1,791 ) — (1,791 ) Financing Activities: Short-term debt—net 35 (112 ) 77 — — Financing fees — (5 ) (6 ) — (11 ) Dividends paid on common stock (209 ) (140 ) (140 ) 280 (209 ) Dividends to/from affiliates 140 140 — (280 ) — Issuance of noncontrolling interest in CFN — — 2,800 — 2,800 Distributions to noncontrolling interests — — (111 ) — (111 ) Net cash (used in) provided by financing activities (34 ) (117 ) 2,620 — 2,469 Effect of exchange rate changes on cash and cash equivalents — — (1 ) — (1 ) (Decrease) increase in cash and cash equivalents (1 ) 5 1,264 — 1,268 Cash and cash equivalents at beginning of period 1 — 285 — 286 Cash and cash equivalents at end of period $ — $ 5 $ 1,549 $ — $ 1,554 Condensed Consolidating Statement of Cash Flows Nine months ended September 30, 2015 Parent CF Industries Other Subsidiaries Eliminations Consolidated (in millions) Operating Activities: Net earnings $ 673 $ 694 $ 824 $ (1,493 ) $ 698 Adjustments to reconcile net earnings to net cash provided by (used in) operating activities: Depreciation and amortization — 11 337 — 348 Deferred income taxes — 30 (36 ) — (6 ) Stock-based compensation expense 13 — — — 13 Unrealized gain on natural gas and foreign currency derivatives — — 70 — 70 Loss on sale of equity method investments — — 43 — 43 Gain on remeasurement of CF Fertilisers UK investment — — (94 ) — (94 ) Loss on disposal of property, plant and equipment — — 18 — 18 Undistributed earnings of affiliates—net (693 ) (800 ) (2 ) 1,493 (2 ) Due to/from affiliates—net 2 — (2 ) — — Changes in: Accounts and notes receivable—net — 18 141 (143 ) 16 Inventories — — (72 ) — (72 ) Accrued and prepaid income taxes 2 (10 ) (61 ) — (69 ) Accounts and notes payable and accrued expenses 6 (79 ) (38 ) 143 32 Customer advances — — 56 — 56 Other—net — — 23 — 23 Net cash provided by (used in) operating activities 3 (136 ) 1,207 — 1,074 Investing Activities: Additions to property, plant and equipment — — (1,791 ) — (1,791 ) Proceeds from sale of property, plant and equipment — — 9 — 9 Proceeds from sale of equity method investment — — 13 — 13 Purchase of CF Fertilisers UK, net of cash acquired — — (554 ) — (554 ) Withdrawals from restricted cash funds — — 60 — 60 Other—net — (82 ) (36 ) 82 (36 ) Net cash used in investing activities — (82 ) (2,299 ) 82 (2,299 ) Financing Activities: Proceeds from long-term borrowings — 1,000 — — 1,000 Short-term debt—net 546 (856 ) 310 — — Financing fees — (28 ) — — (28 ) Dividends paid on common stock (212 ) (212 ) (212 ) 424 (212 ) Dividends to/from affiliates 212 212 — (424 ) — Distributions to noncontrolling interest — — (32 ) — (32 ) Purchases of treasury stock (556 ) — — — (556 ) Issuances of common stock under employee stock plans 8 — — — 8 Shares withheld for taxes — — (1 ) — (1 ) Other—net — — 82 (82 ) — Net cash (used in) provided by financing activities (2 ) 116 147 (82 ) 179 Effect of exchange rate changes on cash and cash equivalents — — (8 ) — (8 ) Increase (decrease) in cash and cash equivalents 1 (102 ) (953 ) — (1,054 ) Cash and cash equivalents at beginning of period — 106 1,891 — 1,997 Cash and cash equivalents at end of period $ 1 $ 4 $ 938 $ — $ 943 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Global nitrogen fertilizer supply has increased faster than global nitrogen fertilizer demand, creating the current global oversupply of nitrogen fertilizer and leading to lower nitrogen fertilizer selling prices. In addition, lower global production costs driven by lower feedstock costs and foreign exchange rates, and reduced ocean freight costs have further contributed to the current lower priced environment. We expect the lower priced environment to continue until global supply and demand become more balanced through a combination of continued demand growth and supply reductions as producers respond to lower realized margins by taking higher cost production facilities off line. Due to the uncertainty of the duration of the current lower priced environment and in order to provide liquidity and covenant flexibility for the future, we have taken and are taking certain additional steps with respect to the Revolving Credit Agreement and the Private Senior Notes. See Note 12—Financing Agreements for a description of the Revolving Credit Agreement and the Private Senior Notes. These steps reflect in part our assessment, based on current fertilizer market conditions, that we may be unable to maintain compliance as of the end of the fourth quarter of 2016 with the total leverage ratio covenant under the Note Purchase Agreement and, under the current terms of the Revolving Credit Agreement. The steps we have taken include, subsequent to September 30, 2016, our entering into the Revolver Amendment described under “—Amendment of Revolving Credit Agreement,” below. The Revolver Amendment provides for modifications to the Revolving Credit Agreement as described in “—Amendment of Revolving Credit Agreement,” below, that would become effective upon the satisfaction of specified conditions, including, among other things, the repayment in full of the $1.0 billion principal amount of the Private Senior Notes prior to or substantially concurrently with the effectiveness of those modifications. Accordingly, we intend to prepay in full the Private Senior Notes during the fourth quarter of 2016. We expect to fund that prepayment and the related make-whole amount, which we estimate (based on market interest rates on October 31, 2016 ) will be approximately $210 million , with the issuance of new long-term secured debt, borrowings under the Revolving Credit Agreement, cash on hand or a combination of any of the foregoing. There can be no assurance that we will be able to complete an issuance of new long-term secured debt on terms acceptable to us or at all. Amendment of Revolving Credit Agreement On October 31, 2016, CF Holdings and CF Industries entered into Amendment No. 3 to the Third Amended and Restated Revolving Credit Agreement, dated as of October 31, 2016 (the Revolver Amendment), with the administrative agent and certain of the lenders and issuing banks under the Revolving Credit Agreement in connection with proposed modifications (the Proposed Modifications) to the Revolving Credit Agreement. The Revolving Credit Agreement, as amended after giving effect to the Proposed Modifications, is referred to herein as the Amended Revolving Credit Agreement. Under the terms of the Revolver Amendment, the effectiveness of the Proposed Modifications and the Amended Revolving Credit Agreement is subject only to the satisfaction of specified conditions set forth in the Revolver Amendment (the Modification Effectiveness Conditions). The Modification Effectiveness Conditions include, but are not limited to, (i) the delivery of specified documents and opinions to the administrative agent, (ii) the payment of accrued and unpaid interest and specified fees and expenses in connection with the Proposed Modifications, (iii) the reduction of the lenders’ commitments under the Revolving Credit Agreement from $1.5 billion to $750 million and (iv) prior to or substantially concurrently with the effectiveness of the Proposed Modifications, the repayment in full of the Private Senior Notes. The borrowers and guarantors under the Amended Revolving Credit Agreement, which will initially comprise CF Holdings, CF Industries and CF Holdings’ wholly owned subsidiaries CF Industries Enterprises, Inc. (CF Enterprises) and CF Industries Sales, LLC (CF Sales), are referred to together herein as the Loan Parties. Upon the effectiveness of the Proposed Modifications, CF Enterprises and CF Sales would guarantee the obligations of the Loan Parties under the Amended Revolving Credit Agreement. CF Holdings and CF Industries guarantee the obligations of the Loan Parties under the Revolving Credit Agreement and would continue to guarantee the obligations of the Loan Parties under the Amended Revolving Credit Agreement. Subject to specified exceptions, the Amended Revolving Credit Agreement would require that each direct or indirect domestic subsidiary of CF Holdings that guarantees debt for borrowed money of any Loan Party in excess of $150 million become a guarantor under the Amended Revolving Credit Agreement. Subject to specified exceptions, the Amended Revolving Credit Agreement would require a grant of a first priority security interest in substantially all of the assets of the Loan Parties, including a pledge by CF Sales of its equity interests in CF Industries Nitrogen, LLC and mortgages over certain material fee-owned domestic real properties, to secure the obligations of the Loan Parties thereunder. In addition to the obligations under the Amended Revolving Credit Agreement, the Loan Parties would also guarantee the obligations under any (i) letter of credit facilities, letter of credit reimbursement agreements, letters of credit, letters of guaranty, surety bonds or similar arrangements in an aggregate amount up to $300 million and (ii) interest rate or other hedging arrangements, in each case between CF Holdings or any of its subsidiaries, on the one hand, and any person that is a lender or the administrative agent under the Amended Revolving Credit Agreement or an affiliate of such person, on the other hand, that are designated by CF Industries as Secured Bilateral LC Facilities or Secured Swap Agreements (each as defined in the Amended Revolving Credit Agreement), as applicable, pursuant to the terms of the Amended Revolving Credit Agreement (such additional obligations, the Additional Guaranteed Obligations). Obligations under Secured Bilateral LC Facilities in an aggregate amount up to $300 million and obligations under Secured Swap Agreements would be secured by the same security interest that secures the obligations under the Amended Revolving Credit Agreement. As compared to the Revolving Credit Agreement, the Amended Revolving Credit Agreement would include modified fees on undrawn commitments and an increased margin applicable to borrowings. In addition to the negative covenants contained in the Revolving Credit Agreement, the Amended Revolving Credit Agreement would limit the ability of CF Holdings and its subsidiaries to incur debt, grant liens, pay dividends, voluntarily prepay certain debt, make investments and dispose of assets, in each case, subject to specified exceptions (such limitations, the Additional Negative Covenants). The Proposed Modifications would replace the financial covenants applicable to CF Holdings and its subsidiaries in the Revolving Credit Agreement with covenants (the New Financial Covenants) that (i) would restrict the ratio of total secured debt to EBITDA (as defined in the Amended Revolving Credit Agreement) for the period of four consecutive fiscal quarters most recently ended to a maximum of 3.75 :1.00, (ii) would require the ratio of EBITDA for the period of four consecutive fiscal quarters most recently ended to consolidated interest expense for the period of four consecutive fiscal quarters most recently ended to be a minimum of 1.20 :1.00 for the fiscal quarters ending on or prior to December 31, 2018, and 1.50 :1.00 thereafter, and (iii) would require the ratio of total debt to total capitalization as of the last day of any fiscal quarter to be less than or equal to 0.60 :1.00. Under the Amended Revolving Credit Agreement, if on any date certain conditions were met, including (i) an absence of an event of default under the Amended Revolving Credit Agreement, (ii) the receipt of an investment grade corporate rating for CF Holdings from two of three selected ratings agencies and (iii) the ratio of CF Holdings’ total net debt to EBITDA for the period of four consecutive fiscal quarters most recently ended being less than 3.75 :1.00, CF Industries would be able to, at its option, choose to (w) suspend the Additional Negative Covenants, (x) replace the New Financial Covenants with covenants requiring the ratio of total net debt to EBITDA for the period of four fiscal consecutive quarters most recently ended to be less than or equal to 3.75 :1.00 and the ratio of EBITDA for the period of four consecutive fiscal quarters most recently ended to consolidated interest expense for the period of four consecutive fiscal quarters most recently ended to be not less than 2.75 :1.00, (y) release the collateral securing the obligations under the Amended Revolving Credit Agreement and (z) release the guarantees supporting, and the collateral securing, the Secured Bilateral LC Facilities and the Secured Swap Agreements. Such a choice by CF Industries would commence a “Covenant Suspension Period" that would expire upon the Company's no longer having an investment grade corporate rating from two of three selected rating agencies. Upon the expiration of a Covenant Suspension Period, the Additional Negative Covenants and the New Financial Covenants would be reinstated, and the Loan Parties party to the Amended Revolving Credit Agreement would be required to guarantee the Additional Guaranteed Obligations and grant a first priority security interest in substantially all of each Loan Party’s assets, including a pledge by CF Sales of its equity interests in CF Industries Nitrogen, LLC and mortgages over certain material fee-owned domestic real properties, subject to certain exceptions, to secure the obligations under the Amended Revolving Credit Agreement, the Secured Bilateral LC Facilities and the Secured Swap Agreements. |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions, by Acquisition | The following table summarizes the allocation of the total fair value of CF Fertilisers UK to the assets acquired and liabilities assumed in its acquisition on July 31, 2015. The fair value of the assets acquired and liabilities assumed is based on the estimated net realizable value for inventories, a replacement cost approach for property, plant and equipment and the income approach for intangible assets. Original Valuation Net Adjustments to Fair Value in 2015 Adjusted Valuation as of December 31, 2015 Net Adjustments to Fair Value in 2016 (1) Final Valuation (in millions) Fair value of consideration transferred $ 570 $ — $ 570 $ — $ 570 Fair value of 50% of equity interest already held by the Company 570 — 570 — 570 Total fair value $ 1,140 $ — $ 1,140 $ — $ 1,140 Assets acquired and liabilities assumed Current assets $ 165 $ 1 $ 166 $ — $ 166 Property, plant and equipment 898 — 898 — 898 Goodwill 328 (8 ) 320 4 324 Other assets 140 (1 ) 139 — 139 Total assets acquired 1,531 (8 ) 1,523 4 1,527 Current liabilities 74 1 75 — 75 Deferred income taxes 129 (9 ) 120 4 124 Other liabilities 188 — 188 — 188 Total liabilities assumed 391 (8 ) 383 4 387 Total net assets acquired $ 1,140 $ — $ 1,140 $ — $ 1,140 |
Net Earnings Per Share (Tables)
Net Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Summary of net earnings per share | Net earnings per share were computed as follows: Three months ended Nine months ended 2016 2015 2016 2015 (in millions, except per share amounts) Net (loss) earnings attributable to common stockholders $ (30 ) $ 90 $ 43 $ 673 Basic earnings per common share: Weighted-average common shares outstanding 233.1 233.1 233.2 236.0 Net (loss) earnings attributable to common stockholders $ (0.13 ) $ 0.39 $ 0.19 $ 2.85 Diluted earnings per common share: Weighted-average common shares outstanding 233.1 233.1 233.2 236.0 Dilutive common shares—stock options — 0.9 0.3 0.9 Diluted weighted-average shares outstanding 233.1 234.0 233.5 236.9 Net (loss) earnings attributable to common stockholders $ (0.13 ) $ 0.39 $ 0.19 $ 2.84 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Inventory Disclosure [Abstract] | |
Schedule of inventories | Inventories consist of the following: September 30, December 31, (in millions) Finished goods $ 280 $ 286 Raw materials, spare parts and supplies 32 35 Total inventories $ 312 $ 321 |
Property, Plant and Equipment31
Property, Plant and Equipment-Net (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Property, Plant and Equipment, Net [Abstract] | |
Components of property, plant and equipment-net | Property, plant and equipment—net consists of the following: September 30, December 31, (in millions) Land $ 66 $ 68 Machinery and equipment 7,754 7,348 Buildings and improvements 342 271 Construction in progress (1) 4,682 3,626 Property, plant and equipment 12,844 11,313 Less: Accumulated depreciation and amortization 3,119 2,774 Property, plant and equipment—net $ 9,725 $ 8,539 _______________________________________________________________________________ (1) As of September 30, 2016 and December 31, 2015 , we had construction in progress that was accrued but unpaid of $426 million and $543 million , respectively. These amounts included accruals related to our capacity expansion projects of $384 million and $471 million as of September 30, 2016 and December 31, 2015 , respectively. |
Summary of plant turnaround activity | The following is a summary of capitalized plant turnaround costs: Nine months ended 2016 2015 (in millions) Net capitalized turnaround costs: Beginning balance $ 220 $ 153 Additions 60 100 Depreciation (66 ) (47 ) Effect of exchange rate changes 2 (2 ) Ending balance $ 216 $ 204 |
Goodwill and Other Intangible32
Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of carrying amount of goodwill by business segment | The following table shows the carrying amount of goodwill by reportable segment as of September 30, 2016 and December 31, 2015 : Ammonia Granular Urea UAN AN Other Total (in millions) Balance as of December 31, 2015 $ 587 $ 828 $ 576 $ 324 $ 75 $ 2,390 CF Fertilisers UK (1) — — — 3 1 4 Effect of exchange rate changes — — — (31 ) (4 ) (35 ) Balance as of September 30, 2016 $ 587 $ 828 $ 576 $ 296 $ 72 $ 2,359 |
Schedule of the identifiable intangibles and their carrying values presented in other noncurrent assets on consolidated balance sheet | All of our identifiable intangible assets have definite lives and are presented in other assets on our consolidated balance sheets at gross carrying amount, net of accumulated amortization, as follows: September 30, 2016 December 31, 2015 Gross Carrying Amount Accumulated Amortization Net Gross Carrying Amount Accumulated Amortization Net (in millions) Intangible assets: Customer relationships $ 129 $ (23 ) $ 106 $ 140 $ (18 ) $ 122 TerraCair brand 10 (10 ) — 10 (10 ) — Trade names 31 (2 ) 29 35 (1 ) 34 Total intangible assets $ 170 $ (35 ) $ 135 $ 185 $ (29 ) $ 156 |
Schedule of estimated future amortization expense | Total estimated amortization expense for the remainder of 2016 and each of the five succeeding fiscal years is as follows: Estimated Amortization Expense (in millions) Remainder of 2016 $ 2 2017 9 2018 9 2019 9 2020 9 2021 9 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Schedule of cash and cash equivalents and other investments reconciliation from adjusted cost to fair value | Our cash and cash equivalents and other investments consist of the following: September 30, 2016 Cost Basis Unrealized Gains Unrealized Losses Fair Value (in millions) Cash $ 113 $ — $ — $ 113 Cash equivalents: U.S. and Canadian government obligations 1,417 — — 1,417 Other debt securities 24 — — 24 Total cash and cash equivalents $ 1,554 $ — $ — $ 1,554 Restricted cash 7 — — 7 Nonqualified employee benefit trusts 17 2 — 19 December 31, 2015 Cost Basis Unrealized Gains Unrealized Losses Fair Value (in millions) Cash $ 71 $ — $ — $ 71 Cash equivalents: U.S. and Canadian government obligations 190 — — 190 Other debt securities 25 — — 25 Total cash and cash equivalents $ 286 $ — $ — $ 286 Restricted cash 23 — — 23 Nonqualified employee benefit trusts 18 1 — 19 |
Schedule of assets and liabilities measured at fair value on a recurring basis | The following tables present assets and liabilities included in our consolidated balance sheets as of September 30, 2016 and December 31, 2015 that are recognized at fair value on a recurring basis, and indicate the fair value hierarchy utilized to determine such fair value: September 30, 2016 Total Fair Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in millions) Cash equivalents $ 1,441 $ 1,441 $ — $ — Restricted cash 7 7 — — Derivative assets 5 — 5 — Nonqualified employee benefit trusts 19 19 — — Derivative liabilities (48 ) — (48 ) — Embedded derivative liability (30 ) — (30 ) — December 31, 2015 Total Fair Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in millions) Cash equivalents $ 215 $ 215 $ — $ — Restricted cash 23 23 — — Nonqualified employee benefit trusts 19 19 — — Derivative liabilities (211 ) — (211 ) — |
Schedule of carrying amounts and estimated fair values of financial instruments | The carrying amount and estimated fair value of our long-term debt is as follows: September 30, 2016 December 31, 2015 Carrying Amount Fair Value Carrying Amount Fair Value (in millions) Long-term debt $ 5,540 $ 5,810 $ 5,537 $ 5,456 |
Interest Expense (Tables)
Interest Expense (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Interest Expense [Abstract] | |
Schedule of interest expense | Details of interest expense are as follows: Three months ended Nine months ended 2016 2015 2016 2015 (in millions) Interest on borrowings (1) $ 76 $ 65 $ 227 $ 192 Fees on financing agreements (1)(2)(3) 6 8 42 12 Interest on tax liabilities 2 1 3 2 Interest capitalized (53 ) (44 ) (142 ) (113 ) Total interest expense $ 31 $ 30 $ 130 $ 93 _______________________________________________________________________________ (1) See Note 12—Financing Agreements for additional information. (2) Fees on financing agreements for the nine months ended September 30, 2016 includes $28 million of fees related to the termination of the tranche B commitment under the bridge credit agreement as a result of the termination of the Combination Agreement. Fees on financing agreements for both the three and nine months ended September 30, 2015 includes $6 million of accelerated amortization of deferred fees related to the termination in September 2015 of the tranche A commitment under the bridge credit agreement. See Note 3—Acquisitions for additional information. (3) Fees on financing agreements for both the three and nine months ended September 30, 2016 includes $2 million of accelerated amortization of deferred fees related to the amendment of our senior unsecured revolving credit agreement which reduced the revolving credit facility to $1.5 billion from $2.0 billion . See Note 12—Financing Agreements for additional information. |
Financing Agreements (Tables)
Financing Agreements (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Components of long-term debt | Long-term debt presented on our consolidated balance sheets as of September 30, 2016 and December 31, 2015 consisted of the following unsecured senior notes: Effective Interest Rate September 30, December 31, Principal Carrying Amount (1) Principal Carrying Amount (1)(2) (in millions) Public Senior Notes: 6.875% due 2018 7.344% $ 800 $ 794 $ 800 $ 792 7.125% due 2020 7.529% 800 790 800 788 3.450% due 2023 3.562% 750 745 750 745 5.150% due 2034 5.279% 750 739 750 739 4.950% due 2043 5.031% 750 741 750 741 5.375% due 2044 5.465% 750 740 750 740 Private Senior Notes: 4.490% due 2022 4.664% 250 248 250 248 4.930% due 2025 5.061% 500 495 500 496 5.030% due 2027 5.145% 250 248 250 248 Total long-term debt $ 5,600 $ 5,540 $ 5,600 $ 5,537 _______________________________________________________________________________ (1) Carrying amount is net of unamortized debt discount and deferred debt issuance costs. Total unamortized debt discount was $7 million as of both September 30, 2016 and December 31, 2015 , and total deferred debt issuance costs were $52 million and $56 million as of September 30, 2016 and December 31, 2015 , respectively. (2) In connection with our adoption of ASU No. 2015-03, Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs, carrying amounts as of December 31, 2015 have been retrospectively adjusted to include a direct deduction of deferred debt issuance costs of $56 million . Prior to the adoption, these costs were included in other assets on our consolidated balance sheets. See Note 2—New Accounting Standards for additional information. |
Derivative Financial Instrume36
Derivative Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of effect of derivatives in the consolidated statements of operations | The effect of derivatives in our consolidated statements of operations is shown in the table below. Unrealized gain (loss) recognized in income Three months ended Location 2016 2015 (in millions) Natural gas derivatives Cost of sales $ (21 ) $ (126 ) Foreign currency derivatives Other operating—net — 13 Unrealized losses recognized in income $ (21 ) $ (113 ) Gain (loss) in income Three months ended All Derivatives 2016 2015 (in millions) Unrealized net losses $ (21 ) $ (113 ) Realized net losses (10 ) (16 ) Net derivative losses $ (31 ) $ (129 ) Unrealized gain (loss) recognized in income Nine months ended Location 2016 2015 (in millions) Natural gas derivatives Cost of sales $ 169 $ (79 ) Foreign currency derivatives Other operating—net (1 ) 16 Unrealized gains recognized in income (losses) $ 168 $ (63 ) Gain (loss) in income Nine months ended All Derivatives 2016 2015 (in millions) Unrealized net gains (losses) $ 168 $ (63 ) Realized net losses (125 ) (75 ) Net derivative gains (losses) $ 43 $ (138 ) |
Schedule of fair values of derivatives in our consolidated balance sheet | The fair values of derivatives on our consolidated balance sheets are shown below. As of September 30, 2016 and December 31, 2015 , none of our derivative instruments were designated as hedging instruments. For additional information on derivative fair values, see Note 9—Fair Value Measurements . Asset Derivatives Liability Derivatives Balance Sheet Location September 30, December 31, Balance Sheet Location September 30, December 31, (in millions) (in millions) Foreign currency derivatives Other current assets $ — $ — Other current liabilities $ (1 ) $ — Foreign currency derivatives Other assets — — Other liabilities — — Natural gas derivatives Other current assets 4 — Other current liabilities (30 ) (130 ) Natural gas derivatives Other assets 1 — Other liabilities (17 ) (81 ) Total derivatives $ 5 $ — $ (48 ) $ (211 ) Current / Noncurrent totals Other current assets $ 4 $ — Other current liabilities $ (31 ) $ (130 ) Other assets 1 — Other liabilities (17 ) (81 ) Total derivatives $ 5 $ — $ (48 ) $ (211 ) |
Schedule of amounts relevant to offsetting of derivative assets | The following table presents amounts relevant to offsetting of our derivative assets and liabilities as of September 30, 2016 and December 31, 2015 : Amounts presented in consolidated balance sheets (1) Gross amounts not offset in consolidated balance sheets Financial instruments Cash collateral received (pledged) Net amount (in millions) September 30, 2016 Total derivative assets $ 5 $ 5 $ — $ — Total derivative liabilities 48 5 — 43 Net derivative liabilities $ (43 ) $ — $ — $ (43 ) December 31, 2015 Total derivative assets $ — $ — $ — $ — Total derivative liabilities 211 — — 211 Net derivative liabilities $ (211 ) $ — $ — $ (211 ) _______________________________________________________________________________ (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. |
Schedule of amounts relevant to offsetting of derivative liabilities | The following table presents amounts relevant to offsetting of our derivative assets and liabilities as of September 30, 2016 and December 31, 2015 : Amounts presented in consolidated balance sheets (1) Gross amounts not offset in consolidated balance sheets Financial instruments Cash collateral received (pledged) Net amount (in millions) September 30, 2016 Total derivative assets $ 5 $ 5 $ — $ — Total derivative liabilities 48 5 — 43 Net derivative liabilities $ (43 ) $ — $ — $ (43 ) December 31, 2015 Total derivative assets $ — $ — $ — $ — Total derivative liabilities 211 — — 211 Net derivative liabilities $ (211 ) $ — $ — $ (211 ) _______________________________________________________________________________ (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. |
Noncontrolling Interests (Table
Noncontrolling Interests (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Noncontrolling Interest [Abstract] | |
Noncontrolling Interests | A reconciliation of the beginning and ending balances of noncontrolling interests and distributions payable to noncontrolling interests in our consolidated balance sheets is provided below. Nine months ended 2016 2015 CFN TNCLP Total TNCLP (in millions) Noncontrolling interests: Beginning balance $ — $ 352 $ 352 $ 363 Issuance of noncontrolling interest in CFN 2,792 — 2,792 — Earnings attributable to noncontrolling interests 67 20 87 25 Declaration of distributions payable (79 ) (32 ) (111 ) (32 ) Ending balance $ 2,780 $ 340 $ 3,120 $ 356 Distributions payable to noncontrolling interests: Beginning balance $ — $ — $ — $ — Declaration of distributions payable 79 32 111 32 Distributions to noncontrolling interests (79 ) (32 ) (111 ) (32 ) Ending balance $ — $ — $ — $ — |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Equity [Abstract] | |
Schedule of changes to AOCI | Changes to accumulated other comprehensive income (loss) 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 as of December 31, 2014 $ (41 ) $ 1 $ 5 $ (125 ) $ (160 ) Unrealized loss — (1 ) — — (1 ) Loss arising during the period — — — (4 ) (4 ) Reclassification to earnings — — — 5 5 Impact of CF Fertilisers UK acquisition 9 — — 38 47 Effect of exchange rate changes and deferred taxes (109 ) — — 8 (101 ) Balance as of September 30, 2015 $ (141 ) $ — $ 5 $ (78 ) $ (214 ) Balance as of December 31, 2015 $ (198 ) $ 1 $ 5 $ (58 ) $ (250 ) Loss arising during the period — — — (3 ) (3 ) Effect of exchange rate changes and deferred taxes (20 ) — — — (20 ) Balance as of September 30, 2016 $ (218 ) $ 1 $ 5 $ (61 ) $ (273 ) |
Schedule of reclassifications out of AOCI | Reclassifications out of accumulated other comprehensive income (loss) to earnings during the three and nine months ended September 30, 2016 and 2015 were as follows: Three months ended Nine months ended 2016 2015 2016 2015 (in millions) Foreign Currency Translation Adjustment CF Fertilisers UK equity method investment remeasurement (1) $ — $ 9 $ — $ 9 Total before tax — 9 — 9 Tax effect — — — — Net of tax $ — $ 9 $ — $ 9 Defined Benefit Plans Amortization of prior service (benefit) cost (2) $ (1 ) $ — $ (1 ) $ (1 ) CF Fertilisers UK equity method investment remeasurement (1) — 38 — 38 Amortization of net loss (2) 1 2 1 6 Total before tax — 40 — 43 Tax effect — (1 ) — (2 ) Net of tax $ — $ 39 $ — $ 41 Total reclassifications for the period $ — $ 48 $ — $ 50 _______________________________________________________________________________ (1) Represents the amount that was reclassified from accumulated other comprehensive income (loss) into equity in earnings of non-operating affiliates—net of taxes as a result of the remeasurement to fair value of our initial 50% equity interest in CF Fertilisers UK. (2) These components are included in the computation of net periodic pension cost and were reclassified from accumulated other comprehensive income (loss) into cost of sales and selling, general and administrative expenses. |
Segment Disclosures (Tables)
Segment Disclosures (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Segment Reporting [Abstract] | |
Summary of segment data for sales, cost of sales and gross margin | Segment data for sales, cost of sales and gross margin for the three and nine months ended September 30, 2016 and 2015 are presented in the tables below. Ammonia Granular (1) UAN (1) AN (1) Other (1) Consolidated (in millions) Three months ended September 30, 2016 Net sales $ 145 $ 167 $ 212 $ 103 $ 53 $ 680 Cost of sales 149 152 218 114 45 678 Gross margin $ (4 ) $ 15 $ (6 ) $ (11 ) $ 8 2 Total other operating costs and expenses 101 Equity in losses of operating affiliates (2 ) Operating loss $ (101 ) Three months ended September 30, 2015 Net sales $ 261 $ 171 $ 349 $ 80 $ 67 $ 928 Cost of sales 207 132 276 97 51 763 Gross margin $ 54 $ 39 $ 73 $ (17 ) $ 16 165 Total other operating costs and expenses 112 Equity in earnings of operating affiliates 6 Operating earnings $ 59 Ammonia Granular Urea (1) UAN (1) AN (1) Other (1) Consolidated (in millions) Nine months ended September 30, 2016 Net sales $ 770 $ 642 $ 891 $ 318 $ 197 $ 2,818 Cost of sales 505 445 646 316 160 2,072 Gross margin $ 265 $ 197 $ 245 $ 2 $ 37 746 Total other operating costs and expenses 501 Equity in losses of operating affiliates (11 ) Operating earnings $ 234 Nine months ended September 30, 2015 Net sales $ 1,148 $ 594 $ 1,112 $ 179 $ 160 $ 3,193 Cost of sales 635 324 678 179 110 1,926 Gross margin $ 513 $ 270 $ 434 $ — $ 50 1,267 Total other operating costs and expenses 231 Equity in earnings of operating affiliates 20 Operating earnings $ 1,056 _______________________________________________________________________________ (1) The cost of the products that are upgraded into other products is transferred at cost into the upgraded product results. |
Condensed Consolidating Finan40
Condensed Consolidating Financial Statements (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Condensed Consolidating Financial Statements | |
Schedule of Condensed Consolidating Statements of Operations | Condensed Consolidating Statement of Operations Three months ended September 30, 2016 Parent CF Industries Other Subsidiaries Eliminations Consolidated (in millions) Net sales $ — $ 80 $ 713 $ (113 ) $ 680 Cost of sales — 35 756 (113 ) 678 Gross margin — 45 (43 ) — 2 Selling, general and administrative expenses 1 4 39 — 44 Other operating—net — 5 52 — 57 Total other operating costs and expenses 1 9 91 — 101 Equity in loss of operating affiliates — — (2 ) — (2 ) Operating (loss) earnings (1 ) 36 (136 ) — (101 ) Interest expense — 86 (38 ) (17 ) 31 Interest income — (12 ) (7 ) 17 (2 ) Net loss of wholly owned subsidiaries 39 1 — (40 ) — Other non-operating—net — — 1 — 1 Loss before income taxes (40 ) (39 ) (92 ) 40 (131 ) Income tax benefit (10 ) — (121 ) — (131 ) Net (loss) earnings (30 ) (39 ) 29 40 — Less: Net earnings attributable to noncontrolling interests — — 30 — 30 Net loss attributable to common stockholders $ (30 ) $ (39 ) $ (1 ) $ 40 $ (30 ) Condensed Consolidating Statement of Operations Three months ended September 30, 2015 Parent CF Industries Other Subsidiaries Eliminations Consolidated (in millions) Net sales $ — $ 78 $ 983 $ (133 ) $ 928 Cost of sales — 84 812 (133 ) 763 Gross margin — (6 ) 171 — 165 Selling, general and administrative expenses — 3 39 — 42 Transaction costs 30 — 7 — 37 Other operating—net — (4 ) 37 — 33 Total other operating costs and expenses 30 (1 ) 83 — 112 Equity in earnings of operating affiliates — — 6 — 6 Operating (loss) earnings (30 ) (5 ) 94 — 59 Interest expense — 74 (21 ) (23 ) 30 Interest income — (22 ) (1 ) 23 — Net earnings of wholly owned subsidiaries (109 ) (143 ) — 252 — Other non-operating—net — — 5 — 5 Earnings before income taxes and equity in earnings of non-operating affiliates 79 86 111 (252 ) 24 Income tax (benefit) provision (11 ) (24 ) 55 — 20 Equity in earnings of non-operating affiliates—net of taxes — — 93 — 93 Net earnings 90 110 149 (252 ) 97 Less: Net earnings attributable to noncontrolling interest — — 7 — 7 Net earnings attributable to common stockholders $ 90 $ 110 $ 142 $ (252 ) $ 90 |
Schedule of Condensed Consolidating Statements of Comprehensive Income | Condensed Consolidating Statement of Comprehensive Income (Loss) Three months ended September 30, 2016 Parent CF Industries Other Subsidiaries Eliminations Consolidated (in millions) Net (loss) earnings $ (30 ) $ (39 ) $ 29 $ 40 $ — Other comprehensive loss (30 ) (30 ) (30 ) 60 (30 ) Comprehensive loss (60 ) (69 ) (1 ) 100 (30 ) Less: Comprehensive income attributable to noncontrolling interests — — 30 — 30 Comprehensive loss attributable to common stockholders $ (60 ) $ (69 ) $ (31 ) $ 100 $ (60 ) Condensed Consolidating Statement of Comprehensive Income Three months ended September 30, 2015 Parent CF Industries Other Subsidiaries Eliminations Consolidated (in millions) Net earnings $ 90 $ 110 $ 149 $ (252 ) $ 97 Other comprehensive loss (7 ) (8 ) (9 ) 16 (8 ) Comprehensive income 83 102 140 (236 ) 89 Less: Comprehensive income attributable to noncontrolling interest — — 7 — 7 Comprehensive income attributable to common stockholders $ 83 $ 102 $ 133 $ (236 ) $ 82 |
Schedule of Condensed Consolidating Balance Sheets | Condensed Consolidating Balance Sheet September 30, 2016 Parent CF Industries Other Subsidiaries Eliminations and Reclassifications Consolidated (in millions) Assets Current assets: Cash and cash equivalents $ — $ 5 $ 1,549 $ — $ 1,554 Restricted cash — — 7 — 7 Accounts and notes receivable—net — 1,316 1,517 (2,626 ) 207 Inventories — — 312 — 312 Prepaid income taxes — — 830 — 830 Other current assets — — 21 — 21 Total current assets — 1,321 4,236 (2,626 ) 2,931 Property, plant and equipment—net — — 9,725 — 9,725 Investments in affiliates 4,156 9,632 287 (13,788 ) 287 Due from affiliates 571 — 2 (573 ) — Goodwill — — 2,359 — 2,359 Other assets — 18 312 — 330 Total assets $ 4,727 $ 10,971 $ 16,921 $ (16,987 ) $ 15,632 Liabilities and Equity Current liabilities: Accounts and notes payable and accrued expenses $ 867 $ 556 $ 2,046 $ (2,626 ) $ 843 Income taxes payable — — 1 — 1 Customer advances — — 86 — 86 Other current liabilities — — 36 — 36 Total current liabilities 867 556 2,169 (2,626 ) 966 Long-term debt — 5,540 — — 5,540 Deferred income taxes — 81 1,561 — 1,642 Due to affiliates — 573 — (573 ) — Other liabilities — 65 439 — 504 Equity: Stockholders' equity: Preferred stock — — 16 (16 ) — Common stock 2 — 1 (1 ) 2 Paid-in capital 1,390 (13 ) 9,936 (9,923 ) 1,390 Retained earnings 2,892 4,442 (48 ) (4,394 ) 2,892 Treasury stock (151 ) — — — (151 ) Accumulated other comprehensive loss (273 ) (273 ) (273 ) 546 (273 ) Total stockholders' equity 3,860 4,156 9,632 (13,788 ) 3,860 Noncontrolling interests — — 3,120 — 3,120 Total equity 3,860 4,156 12,752 (13,788 ) 6,980 Total liabilities and equity $ 4,727 $ 10,971 $ 16,921 $ (16,987 ) $ 15,632 Condensed Consolidating Balance Sheet December 31, 2015 Parent CF Industries Other Subsidiaries Eliminations and Reclassifications Consolidated (in millions) Assets Current assets: Cash and cash equivalents $ 1 $ — $ 285 $ — $ 286 Restricted cash — — 23 — 23 Accounts and notes receivable—net 1 2,987 1,565 (4,286 ) 267 Inventories — — 321 — 321 Prepaid income taxes — — 185 — 185 Other current assets — 24 21 — 45 Total current assets 2 3,011 2,400 (4,286 ) 1,127 Property, plant and equipment—net — — 8,539 — 8,539 Investments in affiliates 4,303 8,148 298 (12,451 ) 298 Due from affiliates 571 — 2 (573 ) — Goodwill — — 2,390 — 2,390 Other assets — 19 310 — 329 Total assets $ 4,876 $ 11,178 $ 13,939 $ (17,310 ) $ 12,683 Liabilities and Equity Current liabilities: Accounts and notes payable and accrued expenses $ 841 $ 648 $ 3,715 $ (4,286 ) $ 918 Income taxes payable — — 5 — 5 Customer advances — — 162 — 162 Other current liabilities — — 130 — 130 Total current liabilities 841 648 4,012 (4,286 ) 1,215 Long-term debt — 5,537 — — 5,537 Deferred income taxes — 52 864 — 916 Due to affiliates — 573 — (573 ) — Other liabilities — 66 562 — 628 Equity: Stockholders' equity: Preferred stock — — 17 (17 ) — Common stock 2 — 1 (1 ) 2 Paid-in capital 1,378 (13 ) 8,365 (8,352 ) 1,378 Retained earnings 3,058 4,565 16 (4,581 ) 3,058 Treasury stock (153 ) — — — (153 ) Accumulated other comprehensive loss (250 ) (250 ) (250 ) 500 (250 ) Total stockholders' equity 4,035 4,302 8,149 (12,451 ) 4,035 Noncontrolling interest — — 352 — 352 Total equity 4,035 4,302 8,501 (12,451 ) 4,387 Total liabilities and equity $ 4,876 $ 11,178 $ 13,939 $ (17,310 ) $ 12,683 |
Schedule of Condensed Consolidating Statements of Cash Flows | Condensed Consolidating Statement of Cash Flows Nine months ended September 30, 2016 Parent CF Industries Other Subsidiaries Eliminations Consolidated (in millions) Operating Activities: Net earnings $ 43 $ 16 $ 163 $ (92 ) $ 130 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation and amortization — 9 466 — 475 Deferred income taxes — 29 701 — 730 Stock-based compensation expense 14 — 1 — 15 Unrealized gain on natural gas and foreign currency derivatives — — (169 ) — (169 ) Unrealized loss on embedded derivative — — 22 — 22 Loss on disposal of property, plant and equipment — — 8 — 8 Undistributed earnings of affiliates—net (16 ) (76 ) — 92 — Changes in: Accounts and notes receivable—net 1 178 (61 ) (63 ) 55 Inventories — — (4 ) — (4 ) Accrued and prepaid income taxes — — (665 ) — (665 ) Accounts and notes payable and accrued expenses (9 ) (34 ) (27 ) 63 (7 ) Customer advances — — (75 ) — (75 ) Other—net — — 76 — 76 Net cash provided by operating activities 33 122 436 — 591 Investing Activities: Additions to property, plant and equipment — — (1,819 ) — (1,819 ) Proceeds from sale of property, plant and equipment — — 8 — 8 Withdrawals from restricted cash funds — — 16 — 16 Other—net — — 4 — 4 Net cash used in investing activities — — (1,791 ) — (1,791 ) Financing Activities: Short-term debt—net 35 (112 ) 77 — — Financing fees — (5 ) (6 ) — (11 ) Dividends paid on common stock (209 ) (140 ) (140 ) 280 (209 ) Dividends to/from affiliates 140 140 — (280 ) — Issuance of noncontrolling interest in CFN — — 2,800 — 2,800 Distributions to noncontrolling interests — — (111 ) — (111 ) Net cash (used in) provided by financing activities (34 ) (117 ) 2,620 — 2,469 Effect of exchange rate changes on cash and cash equivalents — — (1 ) — (1 ) (Decrease) increase in cash and cash equivalents (1 ) 5 1,264 — 1,268 Cash and cash equivalents at beginning of period 1 — 285 — 286 Cash and cash equivalents at end of period $ — $ 5 $ 1,549 $ — $ 1,554 Condensed Consolidating Statement of Cash Flows Nine months ended September 30, 2015 Parent CF Industries Other Subsidiaries Eliminations Consolidated (in millions) Operating Activities: Net earnings $ 673 $ 694 $ 824 $ (1,493 ) $ 698 Adjustments to reconcile net earnings to net cash provided by (used in) operating activities: Depreciation and amortization — 11 337 — 348 Deferred income taxes — 30 (36 ) — (6 ) Stock-based compensation expense 13 — — — 13 Unrealized gain on natural gas and foreign currency derivatives — — 70 — 70 Loss on sale of equity method investments — — 43 — 43 Gain on remeasurement of CF Fertilisers UK investment — — (94 ) — (94 ) Loss on disposal of property, plant and equipment — — 18 — 18 Undistributed earnings of affiliates—net (693 ) (800 ) (2 ) 1,493 (2 ) Due to/from affiliates—net 2 — (2 ) — — Changes in: Accounts and notes receivable—net — 18 141 (143 ) 16 Inventories — — (72 ) — (72 ) Accrued and prepaid income taxes 2 (10 ) (61 ) — (69 ) Accounts and notes payable and accrued expenses 6 (79 ) (38 ) 143 32 Customer advances — — 56 — 56 Other—net — — 23 — 23 Net cash provided by (used in) operating activities 3 (136 ) 1,207 — 1,074 Investing Activities: Additions to property, plant and equipment — — (1,791 ) — (1,791 ) Proceeds from sale of property, plant and equipment — — 9 — 9 Proceeds from sale of equity method investment — — 13 — 13 Purchase of CF Fertilisers UK, net of cash acquired — — (554 ) — (554 ) Withdrawals from restricted cash funds — — 60 — 60 Other—net — (82 ) (36 ) 82 (36 ) Net cash used in investing activities — (82 ) (2,299 ) 82 (2,299 ) Financing Activities: Proceeds from long-term borrowings — 1,000 — — 1,000 Short-term debt—net 546 (856 ) 310 — — Financing fees — (28 ) — — (28 ) Dividends paid on common stock (212 ) (212 ) (212 ) 424 (212 ) Dividends to/from affiliates 212 212 — (424 ) — Distributions to noncontrolling interest — — (32 ) — (32 ) Purchases of treasury stock (556 ) — — — (556 ) Issuances of common stock under employee stock plans 8 — — — 8 Shares withheld for taxes — — (1 ) — (1 ) Other—net — — 82 (82 ) — Net cash (used in) provided by financing activities (2 ) 116 147 (82 ) 179 Effect of exchange rate changes on cash and cash equivalents — — (8 ) — (8 ) Increase (decrease) in cash and cash equivalents 1 (102 ) (953 ) — (1,054 ) Cash and cash equivalents at beginning of period — 106 1,891 — 1,997 Cash and cash equivalents at end of period $ 1 $ 4 $ 938 $ — $ 943 |
New Accounting Standards (Detai
New Accounting Standards (Details) - USD ($) $ in Millions | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2016 | Dec. 31, 2015 | |
Long-term Debt | $ 5,540 | $ 5,537 | |
Adjustments for New Accounting Pronouncement | |||
Long-term Debt | $ 56 | ||
New Accounting Pronouncement, Early Adoption, Effect | Accounting Standards Update 2016-09, Excess Tax Benefit Component | |||
Net cash provided by (used in) operating activities | $ 2 | ||
Net cash provided by (used in) financing activities | (2) | ||
New Accounting Pronouncement, Early Adoption, Effect | Accounting Standards Update 2016-09, Statutory Tax Withholding Component | |||
Net cash provided by (used in) operating activities | (1) | ||
Net cash provided by (used in) financing activities | $ 1 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) - USD ($) $ in Millions | Jul. 31, 2016 | May 22, 2016 | Jul. 31, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | Jul. 31, 2016 | Sep. 30, 2016 | Sep. 30, 2015 |
Business Acquisition [Line Items] | |||||||||
Goodwill | $ 2,359 | $ 2,390 | $ 2,359 | ||||||
Transaction costs | $ 150 | 0 | $ 37 | 179 | $ 37 | ||||
Business Combination, Step Acquisition, Equity Interest in Acquiree, Remeasurement Gain | 0 | $ 94 | |||||||
CF Fertilisers UK | |||||||||
Business Acquisition [Line Items] | |||||||||
Current liabilities | $ 75 | $ 74 | 75 | $ 75 | |||||
Other assets | 139 | 140 | 139 | 139 | |||||
Property, plant and equipment | 898 | 898 | 898 | 898 | |||||
Current assets | 166 | $ 165 | 166 | 166 | |||||
Total Liabilities Assumed | (8) | 4 | |||||||
Deferred Tax Liabilities, Noncurrent | (9) | 4 | |||||||
Total Assets Acquired | (8) | 4 | |||||||
Business acquisition, percentage of voting interests acquired | 50.00% | ||||||||
Business combination, step acquisition, initial percentage ownership | 50.00% | ||||||||
Cash and equivalents | $ 19 | ||||||||
Receivables | 73 | ||||||||
Inventory | 67 | ||||||||
Goodwill | 324 | 328 | $ 324 | 320 | 324 | $ 324 | |||
Business combination, consideration transferred | 570 | 570 | 570 | ||||||
Business combination, finite-lived intangibles | 132 | ||||||||
Ownership interest (as a percent) | 50.00% | 50.00% | |||||||
Finite-Lived Intangible Asset, Useful Life | 20 years | ||||||||
Goodwill | (8) | 4 | |||||||
Fair value of 50% of equity interest already held by the Company | 570 | 570 | 570 | ||||||
Business Combination, Consideration Transferred, Including Equity Interest in Acquiree Held Prior to Combination | 1,140 | 1,140 | 1,140 | ||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets | 1,527 | 1,531 | 1,523 | 1,527 | |||||
Deferred income taxes | 124 | 129 | 120 | 124 | |||||
Other liabilities | 188 | 188 | 188 | 188 | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities | 387 | 391 | 383 | 387 | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net | $ 1,140 | $ 1,140 | $ 1,140 | $ 1,140 | |||||
Business Combination, Step Acquisition, Equity Interest in Acquiree, Remeasurement Gain | $ 94 |
Acquisitions (Details)
Acquisitions (Details) - USD ($) $ in Millions | Jul. 31, 2016 | Jul. 31, 2015 | Dec. 31, 2015 | Jul. 31, 2016 | Sep. 30, 2016 |
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Goodwill | $ 2,390 | $ 2,359 | |||
CF Fertilisers UK | |||||
Business Acquisition [Line Items] | |||||
Business combination, consideration transferred | $ 570 | $ 570 | 570 | ||
Fair value of 50% of equity interest already held by the Company | 570 | 570 | 570 | ||
Total fair value | 1,140 | 1,140 | 1,140 | ||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Current assets | 166 | 165 | 166 | $ 166 | |
Property, plant and equipment | 898 | 898 | 898 | 898 | |
Goodwill | 324 | 328 | 320 | 324 | $ 324 |
Other assets | 139 | 140 | 139 | 139 | |
Total assets acquired | 1,527 | 1,531 | 1,523 | 1,527 | |
Current liabilities | 75 | 74 | 75 | 75 | |
Deferred income taxes | 124 | 129 | 120 | 124 | |
Other liabilities | 188 | 188 | 188 | 188 | |
Total liabilities assumed | 387 | 391 | 383 | 387 | |
Total net assets acquired | $ 1,140 | $ 1,140 | 1,140 | 1,140 | |
Business Combination, Provisional Information, Adjustments [Abstract] | |||||
Current Assets | 1 | ||||
Property, Plant, and Equipment | 0 | ||||
Goodwill | (8) | 4 | |||
Other Assets | (1) | ||||
Total Assets Acquired | (8) | 4 | |||
Current Liabilities | 1 | ||||
Deferred Tax Liabilities, Noncurrent | (9) | 4 | |||
Total Liabilities Assumed | $ (8) | $ 4 |
Net Earnings Per Share (Details
Net Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Net Income (Loss) Available to Common Stockholders, Basic | $ (30) | $ 90 | $ 43 | $ 673 |
Basic earnings per common share: | ||||
Weighted-average common shares outstanding | 233.1 | 233.1 | 233.2 | 236 |
Net earnings attributable to common stockholders (in dollars per share) | $ (0.13) | $ 0.39 | $ 0.19 | $ 2.85 |
Diluted earnings per common share: | ||||
Weighted-average common shares outstanding | 233.1 | 233.1 | 233.2 | 236 |
Dilutive common shares—stock options (in shares) | 0 | 0.9 | 0.3 | 0.9 |
Diluted weighted-average shares outstanding | 233.1 | 234 | 233.5 | 236.9 |
Net earnings attributable to common stockholders diluted (in dollars per share) | $ (0.13) | $ 0.39 | $ 0.19 | $ 2.84 |
Antidilutive securities excluded from computation of EPS (in shares) | 5 | 0.8 | 4.3 | 0.8 |
Retained Earnings | ||||
Net Income (Loss) Available to Common Stockholders, Basic | $ 43 | $ 673 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 280 | $ 286 |
Raw materials, spare parts and supplies | 32 | 35 |
Total inventories | $ 312 | $ 321 |
Property, Plant and Equipment46
Property, Plant and Equipment-Net (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Property, Plant and Equipment-Net | |||||
Gross property plant and equipment | $ 12,844 | $ 12,844 | $ 11,313 | ||
Less: Accumulated depreciation and amortization | 3,119 | 3,119 | 2,774 | ||
Net property, plant and equipment | 9,725 | 9,725 | 8,539 | ||
Construction in progress expenditures incurred but not yet paid | 426 | 543 | |||
Accrued expansion project costs | 384 | 384 | 471 | ||
Depreciation and amortization | 139 | $ 117 | 425 | $ 317 | |
Land | |||||
Property, Plant and Equipment-Net | |||||
Gross property plant and equipment | 66 | 66 | 68 | ||
Machinery and equipment | |||||
Property, Plant and Equipment-Net | |||||
Gross property plant and equipment | 7,754 | 7,754 | 7,348 | ||
Changes in plant turnaround activity | |||||
Balance at the beginning of the period | 220 | 153 | 153 | ||
Additions | 60 | 100 | |||
Depreciation | (66) | (47) | |||
Effect of exchange rate changes | 2 | (2) | |||
Balance at the end of the period | 216 | $ 204 | 216 | $ 204 | 220 |
Buildings and improvements | |||||
Property, Plant and Equipment-Net | |||||
Gross property plant and equipment | 342 | 342 | 271 | ||
Construction in progress | |||||
Property, Plant and Equipment-Net | |||||
Gross property plant and equipment | $ 4,682 | $ 4,682 | $ 3,626 |
Goodwill and Other Intangible47
Goodwill and Other Intangible Assets (Details) - USD ($) $ in Millions | 5 Months Ended | 7 Months Ended | 9 Months Ended | |
Dec. 31, 2015 | Jul. 31, 2016 | Sep. 30, 2016 | Jul. 31, 2015 | |
Goodwill | ||||
Goodwill, Beginning Balance | $ 2,390 | $ 2,390 | ||
Goodwill, Acquired During Period | 4 | |||
Effect of exchange rate changes | (35) | |||
Goodwill, Ending Balance | $ 2,390 | 2,359 | ||
CF Fertilisers UK | ||||
Goodwill | ||||
Goodwill, Beginning Balance | 320 | 320 | ||
Goodwill, Ending Balance | 320 | 324 | 324 | |
Business acquisition, percentage of voting interests acquired | 50.00% | |||
Goodwill | (8) | 4 | ||
Ammonia | ||||
Goodwill | ||||
Goodwill, Beginning Balance | 587 | 587 | ||
Goodwill, Acquired During Period | 0 | |||
Effect of exchange rate changes | 0 | |||
Goodwill, Ending Balance | 587 | 587 | ||
Granular Urea | ||||
Goodwill | ||||
Goodwill, Beginning Balance | 828 | 828 | ||
Goodwill, Acquired During Period | 0 | |||
Effect of exchange rate changes | 0 | |||
Goodwill, Ending Balance | 828 | 828 | ||
UAN | ||||
Goodwill | ||||
Goodwill, Beginning Balance | 576 | 576 | ||
Goodwill, Acquired During Period | 0 | |||
Effect of exchange rate changes | 0 | |||
Goodwill, Ending Balance | 576 | 576 | ||
AN | ||||
Goodwill | ||||
Goodwill, Beginning Balance | 324 | 324 | ||
Goodwill, Acquired During Period | 3 | |||
Effect of exchange rate changes | (31) | |||
Goodwill, Ending Balance | 324 | 296 | ||
Other | ||||
Goodwill | ||||
Goodwill, Beginning Balance | $ 75 | 75 | ||
Goodwill, Acquired During Period | 1 | |||
Effect of exchange rate changes | (4) | |||
Goodwill, Ending Balance | $ 75 | $ 72 |
Goodwill and Other Intangible48
Goodwill and Other Intangible Assets (Details 2) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | Jul. 31, 2015 | |
Identifiable intangibles | ||||||
Gross Carrying Amount | $ 170 | $ 170 | $ 185 | |||
Accumulated Amortization | (35) | (35) | (29) | |||
Net | 135 | 135 | 156 | |||
Amortization expense | 2 | $ 2 | 6 | $ 8 | ||
Total estimated amortization expense for the five succeeding fiscal years | ||||||
Remainder of 2016 | 2 | 2 | ||||
2,017 | 9 | 9 | ||||
2,018 | 9 | 9 | ||||
2,019 | 9 | 9 | ||||
2,020 | 9 | 9 | ||||
2,021 | 9 | $ 9 | ||||
CF Fertilisers UK | ||||||
Identifiable intangibles | ||||||
Business acquisition, percentage of voting interests acquired | 50.00% | |||||
Business combination, finite-lived intangibles | $ 132 | |||||
Finite-Lived Intangible Asset, Useful Life | 20 years | |||||
Customer relationships | ||||||
Identifiable intangibles | ||||||
Gross Carrying Amount | 129 | $ 129 | 140 | |||
Accumulated Amortization | (23) | (23) | (18) | |||
Net | 106 | 106 | 122 | |||
Trademarks | ||||||
Identifiable intangibles | ||||||
Gross Carrying Amount | 10 | 10 | 10 | |||
Accumulated Amortization | (10) | (10) | (10) | |||
Net | 0 | 0 | 0 | |||
Trade names | ||||||
Identifiable intangibles | ||||||
Gross Carrying Amount | 31 | 31 | 35 | |||
Accumulated Amortization | (2) | (2) | (1) | |||
Net | $ 29 | $ 29 | $ 34 |
Equity Method Investments-Narra
Equity Method Investments-Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Jul. 31, 2015 | |
Equity method investments | ||||||
Equity in earnings of non-operating affiliates—net of taxes | $ 0 | $ 93 | $ 0 | $ 72 | ||
Equity in (losses) earnings of operating affiliates | $ (2) | $ 6 | $ (11) | $ 20 | ||
Operating equity method investments | Maximum | Property, plant and equipment | ||||||
Equity method investments | ||||||
Number of years that the increased basis for property, plant and equipment and identifiable intangibles will be amortized | 17 years | |||||
Planned maintenance activity period | 45 days | |||||
Operating equity method investments | Maximum | Gas contract | ||||||
Equity method investments | ||||||
Number of years that the increased basis for property, plant and equipment and identifiable intangibles will be amortized | 2 years | |||||
KEYTRADE AG | Non-operating equity method investments | ||||||
Equity method investments | ||||||
Ownership interest (as a percent) | 50.00% | 50.00% | ||||
Point Lisas Nitrogen Limited (PLNL) | Operating equity method investments | ||||||
Equity method investments | ||||||
Unrecorded unconditional purchase obligation, percent | 50.00% | |||||
Ownership interest (as a percent) | 50.00% | 50.00% | ||||
Carrying value of investments in excess of the entity's share of the affiliates' book value | $ 207 | $ 207 | ||||
Obligation to purchase ammonia (as a percent) | 50% of the ammonia produced by PLNL | |||||
Purchases of ammonia from PLNL | $ 13 | $ 27 | $ 47 | $ 84 | ||
Other than Temporary Impairment Losses, Investments, Portion Recognized in Earnings, Net | $ 62 | |||||
CF Fertilisers UK | ||||||
Equity method investments | ||||||
Ownership interest (as a percent) | 50.00% | 50.00% | ||||
Business acquisition, percentage of voting interests acquired | 50.00% |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Investment | ||
Cash | $ 113 | $ 71 |
Cash equivalents: | ||
Cash and cash equivalents, adjusted cost | 1,554 | 286 |
Cash and cash equivalents, fair value disclosure | 1,554 | 286 |
Restricted Cash, adjusted cost | 7 | 23 |
Restricted Cash, Fair Value | 7 | 23 |
U.S. and Canadian government obligations | ||
Cash equivalents: | ||
Cash equivalents, adjusted cost | 1,417 | 190 |
Cash equivalents, fair value | 1,417 | 190 |
Other debt securities | ||
Cash equivalents: | ||
Cash equivalents, adjusted cost | 24 | 25 |
Cash equivalents, fair value | 24 | 25 |
Nonqualified employee benefit trusts | ||
Cash equivalents: | ||
Available-for-sale securities, adjusted cost | 17 | 18 |
Available-for-sale securities, gross unrealized gain | 2 | 1 |
Available-for-sale securities, fair value | $ 19 | $ 19 |
Fair Value Measurements (Deta51
Fair Value Measurements (Details 2) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Dec. 31, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Assets and liabilities measured at fair value on a recurring basis | |||
Restricted cash | $ 23 | $ 7 | |
Unrealized loss on embedded derivative | 22 | $ 0 | |
Long-term debt | 5,537 | 5,540 | |
Fair value of long-term debt, including current portion | 5,456 | 5,810 | |
Recurring basis | |||
Assets and liabilities measured at fair value on a recurring basis | |||
Cash equivalents | 215 | 1,441 | |
Restricted cash | 23 | 7 | |
Derivative assets | 5 | ||
Nonqualified employee benefit trusts | 19 | 19 | |
Derivative liabilities | (211) | (48) | |
Recurring basis | Quoted Prices in Active Markets (Level 1) | |||
Assets and liabilities measured at fair value on a recurring basis | |||
Cash equivalents | 215 | 1,441 | |
Restricted cash | 23 | 7 | |
Derivative assets | 0 | ||
Nonqualified employee benefit trusts | 19 | 19 | |
Derivative liabilities | 0 | 0 | |
Embedded derivative liability | 0 | ||
Recurring basis | Significant Other Observable Inputs (Level 2) | |||
Assets and liabilities measured at fair value on a recurring basis | |||
Cash equivalents | 0 | 0 | |
Restricted cash | 0 | 0 | |
Derivative assets | 5 | ||
Nonqualified employee benefit trusts | 0 | 0 | |
Derivative liabilities | (211) | (48) | |
Embedded derivative liability | (30) | ||
Recurring basis | Fair Value, Inputs (Level 3) | |||
Assets and liabilities measured at fair value on a recurring basis | |||
Cash equivalents | 0 | 0 | |
Restricted cash | 0 | 0 | |
Derivative assets | 0 | ||
Nonqualified employee benefit trusts | 0 | 0 | |
Derivative liabilities | 0 | 0 | |
Embedded derivative liability | $ 0 | ||
Point Lisas Nitrogen Limited (PLNL) | Operating equity method investments | |||
Assets and liabilities measured at fair value on a recurring basis | |||
Other than Temporary Impairment Losses, Investments, Portion Recognized in Earnings, Net | $ 62 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Jul. 31, 2015 | |
Differences in the expected income tax provision based on statutory rates applied to earnings before income taxes and the income tax provision reflected in the consolidated statements of operations | |||||||
Income tax (benefit) provision | $ (131) | $ 20 | $ (21) | $ 333 | |||
Pre-tax income | (131) | 24 | 109 | 959 | |||
Income tax expense reversal of manufacturing deduction | 42 | ||||||
Increase in deferred tax assets valuation allowance | 21 | ||||||
Income tax benefit from termination of acquisition | 9 | ||||||
Prepaid income taxes | 830 | 830 | $ 185 | ||||
Gain on remeasurement of CF Fertilisers UK investment | 0 | $ (94) | |||||
Prior Tax Periods [Member] | |||||||
Differences in the expected income tax provision based on statutory rates applied to earnings before income taxes and the income tax provision reflected in the consolidated statements of operations | |||||||
Prepaid income taxes | 760 | $ 760 | |||||
CF Fertilisers UK | |||||||
Differences in the expected income tax provision based on statutory rates applied to earnings before income taxes and the income tax provision reflected in the consolidated statements of operations | |||||||
Business acquisition, percentage of voting interests acquired | 50.00% | ||||||
Gain on remeasurement of CF Fertilisers UK investment | $ (94) | ||||||
Business combination, step acquisition, initial percentage ownership | 50.00% | ||||||
Canada Revenue Agency [Member] | |||||||
Differences in the expected income tax provision based on statutory rates applied to earnings before income taxes and the income tax provision reflected in the consolidated statements of operations | |||||||
Income Tax Examination, Estimate of Possible Loss | 88 | ||||||
Income Tax Examination, Penalties and Interest Expense | $ 31 | ||||||
Scenario, Forecast | |||||||
Differences in the expected income tax provision based on statutory rates applied to earnings before income taxes and the income tax provision reflected in the consolidated statements of operations | |||||||
Income tax (benefit) provision | $ (163) |
Interest Expense (Details)
Interest Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Jul. 29, 2016 | |
Financing agreements | |||||
Interest on borrowings(1) | $ 76 | $ 65 | $ 227 | $ 192 | |
Fees on financing agreements(1)(2)(3) | 6 | 8 | 42 | 12 | |
Interest on tax liabilities | 2 | 1 | 3 | 2 | |
Interest capitalized | (53) | (44) | (142) | (113) | |
Interest expense | 31 | 30 | 130 | 93 | |
Line of Credit | Bridge Credit Agreement, Tranche A | Bridge Loan | |||||
Financing agreements | |||||
Fees on financing agreements(1)(2)(3) | 28 | 28 | |||
Line of Credit | Bridge Credit Agreement, Tranche B | Bridge Loan | |||||
Financing agreements | |||||
Fees on financing agreements(1)(2)(3) | $ 6 | $ 6 | |||
Line of Credit | CF Industries | July 2016 Credit Agreement Amendment | Revolving Credit Facility | |||||
Financing agreements | |||||
Maximum borrowing capacity | $ 1,500 | ||||
Line of Credit | CF Industries | Credit Agreement | Revolving Credit Facility | |||||
Financing agreements | |||||
Accelerated amortization of deferred fees | 2 | 2 | |||
Maximum borrowing capacity | $ 2,000 | $ 2,000 |
Financing Agreements (Details)
Financing Agreements (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Financing agreements | ||
Principal | $ 5,600,000,000 | $ 5,600,000,000 |
Carrying amount | 5,540,000,000 | 5,537,000,000 |
CF Industries | ||
Debt Instruments | ||
Unamortized debt discount | 7,000,000 | 7,000,000 |
Total deferred debt issuance costs | $ 52,000,000 | $ 56,000,000 |
CF Industries | Senior Notes | Unsecured senior notes 6.875% due 2018 | ||
Financing agreements | ||
Effective Interest Rate (percent) | 7.344% | 7.344% |
Interest rate (as a percent) | 6.875% | 6.875% |
Principal | $ 800,000,000 | $ 800,000,000 |
Carrying amount | $ 794,000,000 | $ 792,000,000 |
CF Industries | Senior Notes | Unsecured senior notes 7.125% due 2020 | ||
Financing agreements | ||
Effective Interest Rate (percent) | 7.529% | 7.529% |
Interest rate (as a percent) | 7.125% | 7.125% |
Principal | $ 800,000,000 | $ 800,000,000 |
Carrying amount | $ 790,000,000 | $ 788,000,000 |
CF Industries | Senior Notes | Senior notes 3.450% due 2023 | ||
Financing agreements | ||
Effective Interest Rate (percent) | 3.562% | 3.562% |
Interest rate (as a percent) | 3.45% | 3.45% |
Principal | $ 750,000,000 | $ 750,000,000 |
Carrying amount | $ 745,000,000 | $ 745,000,000 |
CF Industries | Senior Notes | Senior notes 5.150% due 2034 | ||
Financing agreements | ||
Effective Interest Rate (percent) | 5.279% | 5.279% |
Interest rate (as a percent) | 5.15% | 5.15% |
Principal | $ 750,000,000 | $ 750,000,000 |
Carrying amount | $ 739,000,000 | $ 739,000,000 |
CF Industries | Senior Notes | Senior notes 4.950% due 2043 | ||
Financing agreements | ||
Effective Interest Rate (percent) | 5.031% | 5.031% |
Interest rate (as a percent) | 4.95% | 4.95% |
Principal | $ 750,000,000 | $ 750,000,000 |
Carrying amount | $ 741,000,000 | $ 741,000,000 |
CF Industries | Senior Notes | Senior notes 5.375% due 2044 | ||
Financing agreements | ||
Effective Interest Rate (percent) | 5.465% | 5.465% |
Interest rate (as a percent) | 5.375% | 5.375% |
Principal | $ 750,000,000 | $ 750,000,000 |
Carrying amount | $ 740,000,000 | $ 740,000,000 |
CF Industries | Senior Notes | Senior Notes 4.490% Due October 15, 2022 | ||
Financing agreements | ||
Effective Interest Rate (percent) | 4.664% | 4.626% |
Interest rate (as a percent) | 4.49% | 4.49% |
Principal | $ 250,000,000 | $ 250,000,000 |
Carrying amount | $ 248,000,000 | $ 248,000,000 |
CF Industries | Senior Notes | Senior Notes 4.93% Due October 15, 2025 | ||
Financing agreements | ||
Effective Interest Rate (percent) | 5.061% | 5.061% |
Interest rate (as a percent) | 4.93% | 4.93% |
Principal | $ 500,000,000 | $ 500,000,000 |
Carrying amount | $ 495,000,000 | $ 496,000,000 |
CF Industries | Senior Notes | Senior Notes 5.03% Due October 15, 2027 | ||
Financing agreements | ||
Effective Interest Rate (percent) | 5.145% | 5.145% |
Interest rate (as a percent) | 5.03% | 5.03% |
Principal | $ 250,000,000 | $ 250,000,000 |
Carrying amount | $ 248,000,000 | $ 248,000,000 |
Financing Agreements Financing
Financing Agreements Financing Agreements - Narrative (Details) | Sep. 24, 2015 | Sep. 18, 2015USD ($)covenant | Sep. 30, 2016USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Jul. 29, 2016USD ($) | Dec. 31, 2015USD ($) |
Credit Agreement | Line of Credit | Revolving Credit Facility | |||||||||||||
Financing agreements | |||||||||||||
Threshold of potential guarantor obligation | $ 500,000,000 | ||||||||||||
Bridge Credit Agreement | Line of Credit | Bridge Loan | |||||||||||||
Financing agreements | |||||||||||||
Maturity period | 364 days | ||||||||||||
CF Industries | |||||||||||||
Financing agreements | |||||||||||||
Unamortized debt discount | $ 7,000,000 | $ 7,000,000 | $ 7,000,000 | ||||||||||
Total deferred debt issuance costs | $ 52,000,000 | $ 52,000,000 | $ 56,000,000 | ||||||||||
CF Industries | Private Placement Senior Notes | Senior Notes | |||||||||||||
Financing agreements | |||||||||||||
Redemption price of debt as percentage of principal amount | 100.00% | ||||||||||||
Debt Instrument, Elevated Ratio Fee, Percent, Scenario One | 0.125% | ||||||||||||
Debt Instrument, Elevated Ratio Fee, Percent, Scenario Two | 0.25% | ||||||||||||
Debt Instrument, Fee, Percent | 0.75% | ||||||||||||
Debt instrument, percentage of principal required for payment of outstanding debt in full | 50.00% | ||||||||||||
CF Industries | Private Placement Senior Notes | Senior Notes | Minimum | |||||||||||||
Financing agreements | |||||||||||||
Debt instrument, redemption price, percentage of principal amount redeemed | 5.00% | ||||||||||||
CF Industries | Private Placement Senior Notes | Senior Notes | Maximum | |||||||||||||
Financing agreements | |||||||||||||
Debt instrument, redemption price, percentage of principal amount redeemed | 100.00% | ||||||||||||
Debt Instrument, Covenant Compliance, Number of Covenants | covenant | 2 | ||||||||||||
Ratio of Interest Coverage | 2.75 | 5.25 | 5.25 | ||||||||||
CF Industries | Senior Notes 4.490% Due October 15, 2022 | Senior Notes | |||||||||||||
Financing agreements | |||||||||||||
Interest rate (as a percent) | 4.49% | 4.49% | 4.49% | ||||||||||
CF Industries | Senior Notes 4.93% Due October 15, 2025 | Senior Notes | |||||||||||||
Financing agreements | |||||||||||||
Interest rate (as a percent) | 4.93% | 4.93% | 4.93% | ||||||||||
CF Industries | Senior Notes 5.03% Due October 15, 2027 | Senior Notes | |||||||||||||
Financing agreements | |||||||||||||
Interest rate (as a percent) | 5.03% | 5.03% | 5.03% | ||||||||||
CF Industries | Credit Agreement | |||||||||||||
Financing agreements | |||||||||||||
Available credit | $ 1,495,000,000 | $ 1,495,000,000 | |||||||||||
Outstanding letters of credit | 5,000,000 | 5,000,000 | |||||||||||
Long-term Line of Credit | 0 | 0 | $ 0 | ||||||||||
Line of credit facility, maximum amount outstanding during period | $ 150,000,000 | $ 367,000,000 | |||||||||||
Debt instrument, weighted average interest rate for borrowings during period | 1.85% | 1.47% | |||||||||||
CF Industries | Credit Agreement | Line of Credit | Revolving Credit Facility | |||||||||||||
Financing agreements | |||||||||||||
Maximum borrowing capacity | $ 2,000,000,000 | $ 2,000,000,000 | |||||||||||
Ratio of Indebtedness to Net Capital | 3.75 | 3.75 | |||||||||||
CF Industries | Credit Agreement | Line of Credit | Letter of Credit | |||||||||||||
Financing agreements | |||||||||||||
Maximum borrowing capacity | $ 200,000,000 | $ 200,000,000 | |||||||||||
CF Industries | Public Senior Notes | Senior Notes | |||||||||||||
Financing agreements | |||||||||||||
Debt Instrument, Debt Default, Description of Violation or Event of Default, Threshold Amount | $ 150,000,000 | ||||||||||||
Redemption price of debt as percentage of principal amount | 101.00% | ||||||||||||
CF Industries | July 2016 Credit Agreement Amendment | Line of Credit | Revolving Credit Facility | |||||||||||||
Financing agreements | |||||||||||||
Maximum borrowing capacity | $ 1,500,000,000 | ||||||||||||
Ratio of Indebtedness to Net Capital | 5.25 | 5.25 | |||||||||||
CF Industries | July 2016 Credit Agreement Amendment | Line of Credit | Letter of Credit | |||||||||||||
Financing agreements | |||||||||||||
Maximum borrowing capacity | $ 100,000,000 | ||||||||||||
Scenario, Forecast | CF Industries | Private Placement Senior Notes | Senior Notes | Maximum | |||||||||||||
Financing agreements | |||||||||||||
Ratio of Interest Coverage | 4 | 4.75 | 5 | 5.25 | 5.25 | ||||||||
Ratio of Indebtedness to Net Capital | 3.75 | ||||||||||||
Scenario, Forecast | CF Industries | July 2016 Credit Agreement Amendment | Line of Credit | Revolving Credit Facility | |||||||||||||
Financing agreements | |||||||||||||
Ratio of Indebtedness to Net Capital | 4 | 4.75 | 5 | 5.25 | 5.25 |
Derivative Financial Instrume56
Derivative Financial Instruments (Details) € in Millions, MMBTU in Millions | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2016USD ($)MMBTU | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($)MMBTU | Sep. 30, 2015USD ($) | Sep. 30, 2016EUR (€)MMBTU | Dec. 31, 2015USD ($)MMBTU | Dec. 31, 2015EUR (€)MMBTU | |
Fair values of derivatives on consolidated balance sheets | |||||||
Open derivative contracts for natural gas (in MMBtus) | MMBTU | 247.2 | 247.2 | 247.2 | 431.5 | 431.5 | ||
Percentage of natural gas consumption covered by derivatives | 86.00% | ||||||
Derivative, net liability position, aggregate fair value | $ 43,000,000 | $ 43,000,000 | $ 211,000,000 | ||||
Cash collateral on deposit with derivative counterparties | 0 | 0 | 0 | ||||
Gain (loss) on sale of derivatives | (125,000,000) | $ (75,000,000) | |||||
Net of tax | 43,000,000 | (138,000,000) | |||||
Derivatives not designated as cash flow hedges | |||||||
Fair values of derivatives on consolidated balance sheets | |||||||
Cash collateral on deposit with derivative counterparties | 0 | 0 | $ 0 | ||||
Unrealized gain (loss) on derivatives | (21,000,000) | $ (113,000,000) | 168,000,000 | (63,000,000) | |||
Gain (loss) on sale of derivatives | (10,000,000) | (16,000,000) | |||||
Net of tax | (31,000,000) | (129,000,000) | |||||
Derivatives not designated as cash flow hedges | Natural gas derivatives | Cost of Sales | |||||||
Fair values of derivatives on consolidated balance sheets | |||||||
Unrealized gain (loss) on derivatives | (21,000,000) | (126,000,000) | 169,000,000 | (79,000,000) | |||
Derivatives not designated as cash flow hedges | Foreign exchange contracts | |||||||
Fair values of derivatives on consolidated balance sheets | |||||||
Notional amount of derivative | 0 | 0 | € 50 | € 89 | |||
Derivatives not designated as cash flow hedges | Foreign exchange contracts | Other operating - net | |||||||
Fair values of derivatives on consolidated balance sheets | |||||||
Unrealized gain (loss) on derivatives | $ 0 | $ 13,000,000 | (1,000,000) | $ 16,000,000 | |||
Derivatives designated as cash flow hedges | Foreign exchange contracts | |||||||
Fair values of derivatives on consolidated balance sheets | |||||||
Unrealized gain (loss) on cash flow hedges, pretax, in AOCI | $ 7,000,000 |
Derivative Financial Instrume57
Derivative Financial Instruments (Details 2) - Derivatives not designated as cash flow hedges - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Fair values of derivatives on consolidated balance sheets | ||
Other current assets | $ 4 | $ 0 |
Other assets | 1 | 0 |
Asset Derivative | 5 | 0 |
Other current liabilities | (31) | (130) |
Other liabilities | (17) | (81) |
Liability derivative | (48) | (211) |
Foreign exchange contracts | ||
Fair values of derivatives on consolidated balance sheets | ||
Other current assets | 0 | 0 |
Other assets | 0 | 0 |
Other current liabilities | (1) | 0 |
Other liabilities | 0 | 0 |
Natural gas derivatives | ||
Fair values of derivatives on consolidated balance sheets | ||
Other current assets | 4 | 0 |
Other assets | 1 | 0 |
Other current liabilities | (30) | (130) |
Other liabilities | $ (17) | $ (81) |
Derivative Financial Instrume58
Derivative Financial Instruments (Details 3) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Gross amounts not offset in consolidated balance sheets | ||
Cash collateral on deposit with derivative counterparties | $ 0 | $ 0 |
Derivatives not designated as cash flow hedges | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative assets | 5,000,000 | 0 |
Derivative Liability | 48,000,000 | 211,000,000 |
Gross and net amounts presented in consolidated balance sheets, net assets | (43,000,000) | (211,000,000) |
Gross amounts not offset in consolidated balance sheets | ||
Derivative, collateral, obligation to return securities | 5,000,000 | 0 |
Derivative liability, not subject to master netting arrangement deduction | 5,000,000 | 0 |
Net derivative (asset) liability, not subject to master netting arrangement deduction | 0 | 0 |
Derivative, collateral, obligation to return cash | 0 | 0 |
Cash collateral on deposit with derivative counterparties | 0 | 0 |
Derivative, collateral, obligation to return cash (right to reclaim cash) | 0 | 0 |
Derivative asset, fair value, offset against collateral, net of not subject to master netting arrangement, policy election | 0 | 0 |
Derivative liability, fair value, offset against collateral, net of not subject to master netting arrangement, policy election | 43,000,000 | 211,000,000 |
Net derivative asset (liability), fair value, offset against collateral, net of not subject to master netting arrangement, policy election | $ (43,000,000) | $ (211,000,000) |
Noncontrolling Interests (Detai
Noncontrolling Interests (Details) T in Thousands, $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016USD ($)T | Sep. 30, 2016USD ($)T | Sep. 30, 2015USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Noncontrolling interest | |||||
Distributions Payable to Minority Interest | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 |
Issuance of noncontrolling interest in CFN | 2,800 | 0 | |||
Unrealized loss on embedded derivative | 22 | 0 | |||
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders | 111 | 32 | |||
CF Industries Nitrogen, LLC | |||||
Noncontrolling interest | |||||
Distributions Payable to Minority Interest | 0 | $ 0 | 0 | ||
Issuance of noncontrolling interest in CFN | $ 2,800 | ||||
Maximum Annual Granular Urea Tons Eligible for Purchase | T | 1,100 | 1,100 | |||
Maximum Annual UAN Tons Eligible for Purchase | T | 580 | 580 | |||
Embedded Derivative, Fair Value of Embedded Derivative Liability | $ 8 | $ 8 | |||
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders | 79 | ||||
TNCLP | |||||
Noncontrolling interest | |||||
Distributions Payable to Minority Interest | $ 0 | 0 | 0 | $ 0 | $ 0 |
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders | $ 32 | 32 | |||
Percentage of aggregate ownership held by entity through general and limited partnership | 75.30% | 75.30% | |||
Percentage of ownership interest held by outside investors | 24.70% | 24.70% | |||
Earnings attributable to general partnership interest in excess of the threshold levels | $ 56 | $ 83 | |||
Average trading days for which purchase price is greater | 20 days | ||||
Number of days before announcing purchase price | 5 days | ||||
Period within which highest price is paid for any unit preceding the date of purchase is announced | 90 days | ||||
TNCLP | Minimum | |||||
Noncontrolling interest | |||||
Notice period for making decision to purchase the outstanding units | 30 days | ||||
TNCLP | Maximum | |||||
Noncontrolling interest | |||||
Percentage of ownership allowing majority owner to acquire outstanding units | 25.00% | 25.00% | |||
Notice period for making decision to purchase the outstanding units | 60 days | ||||
Significant Other Observable Inputs (Level 2) | Recurring basis | |||||
Noncontrolling interest | |||||
Embedded Derivative, Fair Value of Embedded Derivative Liability | $ 30 | $ 30 |
Noncontrolling Interests (Det60
Noncontrolling Interests (Details 2) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Noncontrolling interest | ||||
Noncontrolling Interest, Increase from Subsidiary Equity Issuance | $ 2,792 | $ 0 | ||
Noncontrolling interest | ||||
Beginning balance | 352 | 363 | ||
Earnings attributable to noncontrolling interests | $ 30 | $ 7 | 87 | 25 |
Declaration of distributions payable | (111) | (32) | ||
Ending balance | 3,120 | 356 | 3,120 | 356 |
Distributions payable to noncontrolling interests: | ||||
Beginning balance | 0 | 0 | ||
Declaration of distributions payable | 111 | 32 | ||
Distributions to noncontrolling interest | (111) | 32 | ||
Ending balance | 0 | 0 | 0 | 0 |
CF Industries Nitrogen, LLC | ||||
Noncontrolling interest | ||||
Noncontrolling Interest, Increase from Subsidiary Equity Issuance | 2,792 | |||
Noncontrolling interest | ||||
Beginning balance | 0 | |||
Earnings attributable to noncontrolling interests | 67 | |||
Declaration of distributions payable | (79) | |||
Ending balance | 2,780 | 2,780 | ||
Distributions payable to noncontrolling interests: | ||||
Beginning balance | 0 | |||
Declaration of distributions payable | 79 | |||
Distributions to noncontrolling interest | 79 | |||
Ending balance | 0 | 0 | ||
TNCLP | ||||
Noncontrolling interest | ||||
Beginning balance | 352 | 363 | ||
Earnings attributable to noncontrolling interests | 20 | 25 | ||
Declaration of distributions payable | (32) | (32) | ||
Ending balance | 340 | 356 | 340 | 356 |
Distributions payable to noncontrolling interests: | ||||
Beginning balance | 0 | 0 | ||
Declaration of distributions payable | 32 | 32 | ||
Distributions to noncontrolling interest | (32) | (32) | ||
Ending balance | $ 0 | $ 0 | $ 0 | $ 0 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Changes to accumulated other comprehensive income (loss) | ||
Other Comprehensive Income Unrealized Holding Gain (Loss) Arising During Period, before Tax | $ (1) | |
Other Comprehensive Income Pension and Other Postretirement Benefit Plans Arising During Period before Tax | $ (3) | (4) |
Balance at the beginning of the period | (250) | (160) |
Reclassification to earnings | 5 | |
Effect of exchange rate changes and deferred taxes | (20) | (101) |
Balance at the end of the period | (273) | (214) |
Foreign Currency Translation Adjustment | ||
Changes to accumulated other comprehensive income (loss) | ||
Balance at the beginning of the period | (198) | (41) |
Reclassification to earnings | 0 | |
Effect of exchange rate changes and deferred taxes | (20) | (109) |
Balance at the end of the period | (218) | (141) |
Unrealized Gain (Loss) on Securities | ||
Changes to accumulated other comprehensive income (loss) | ||
Other Comprehensive Income Unrealized Holding Gain (Loss) Arising During Period, before Tax | (1) | |
Balance at the beginning of the period | 1 | 1 |
Reclassification to earnings | 0 | |
Effect of exchange rate changes and deferred taxes | 0 | 0 |
Balance at the end of the period | 1 | 0 |
Unrealized Gain (Loss) on Derivatives | ||
Changes to accumulated other comprehensive income (loss) | ||
Other Comprehensive Income Unrealized Holding Gain (Loss) Arising During Period, before Tax | 0 | |
Balance at the beginning of the period | 5 | 5 |
Reclassification to earnings | 0 | |
Effect of exchange rate changes and deferred taxes | 0 | 0 |
Balance at the end of the period | 5 | 5 |
Defined Benefit Plans | ||
Changes to accumulated other comprehensive income (loss) | ||
Other Comprehensive Income Pension and Other Postretirement Benefit Plans Arising During Period before Tax | (3) | (4) |
Balance at the beginning of the period | (58) | (125) |
Reclassification to earnings | 5 | |
Effect of exchange rate changes and deferred taxes | 0 | 8 |
Balance at the end of the period | $ (61) | (78) |
CF Fertilisers UK | ||
Changes to accumulated other comprehensive income (loss) | ||
Reclassification to earnings | (47) | |
CF Fertilisers UK | Foreign Currency Translation Adjustment | ||
Changes to accumulated other comprehensive income (loss) | ||
Reclassification to earnings | (9) | |
CF Fertilisers UK | Defined Benefit Plans | ||
Changes to accumulated other comprehensive income (loss) | ||
Reclassification to earnings | $ (38) |
Stockholders' Equity (Details 2
Stockholders' Equity (Details 2) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Jul. 31, 2015 | |
Reclassification out of AOCI | |||||
CF Fertilisers UK equity method investment remeasurement | $ 0 | $ 93 | $ 0 | $ 72 | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 5 | ||||
Tax effect | 131 | (20) | 21 | (333) | |
Net earnings | 0 | 97 | 130 | 698 | |
Foreign Currency Translation Adjustment | |||||
Reclassification out of AOCI | |||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 0 | ||||
Defined Benefit Plans | |||||
Reclassification out of AOCI | |||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 5 | ||||
Amount Reclassified from AOCI | |||||
Reclassification out of AOCI | |||||
Net earnings | 0 | 48 | 0 | 50 | |
Amount Reclassified from AOCI | Foreign Currency Translation Adjustment | |||||
Reclassification out of AOCI | |||||
CF Fertilisers UK equity method investment remeasurement | 0 | 9 | 0 | 9 | |
Total before tax | 0 | 9 | 0 | 9 | |
Tax effect | 0 | 0 | 0 | 0 | |
Net earnings | 0 | 9 | 0 | 9 | |
Amount Reclassified from AOCI | Defined Benefit Plans | |||||
Reclassification out of AOCI | |||||
Amortization of prior service cost | (1) | 0 | (1) | (1) | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 0 | 38 | 0 | 38 | |
Amortization of net loss | 1 | 2 | 1 | 6 | |
Total before tax | 0 | 40 | 0 | 43 | |
Tax effect | 0 | (1) | 0 | (2) | |
Net earnings | $ 0 | $ 39 | $ 0 | 41 | |
CF Fertilisers UK | |||||
Reclassification out of AOCI | |||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | (47) | ||||
Business combination, step acquisition, initial percentage ownership | 50.00% | ||||
CF Fertilisers UK | Foreign Currency Translation Adjustment | |||||
Reclassification out of AOCI | |||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | (9) | ||||
CF Fertilisers UK | Defined Benefit Plans | |||||
Reclassification out of AOCI | |||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | $ (38) |
Stockholders' Equity (Details 3
Stockholders' Equity (Details 3) - USD ($) shares in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | Aug. 06, 2014 | |
Equity, Class of Treasury Stock [Line Items] | |||||
Purchase of treasury stock (in dollars) | $ 527,000,000 | ||||
Treasury stock (in dollars) | $ 151,000,000 | $ 153,000,000 | |||
Share retired (in shares) | 0 | 10.7 | |||
2014 Program | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Share repurchase authorized | $ 1,000,000,000 | ||||
Treasury Stock, Shares, Acquired | 0.3 | 8.9 | |||
Purchase of treasury stock (in dollars) | $ 527,000,000 | ||||
Accumulated number of shares repurchased (in shares) | 15.9 | ||||
Treasury stock (in dollars) | $ 900,000,000 |
Contingencies (Details)
Contingencies (Details) - Pending Litigation | Apr. 17, 2015Insurance_companyPeoplePlaintiffEntity | Apr. 17, 2013People | Sep. 30, 2016Litigation_case |
Loss Contingencies [Line Items] | |||
Number of people killed | 15 | ||
Number of people injured | 200 | ||
Number of plaintiffs | Plaintiff | 400 | ||
Number of entities that filed claims | Entity | 9 | ||
Number of people that filed claims | 325 | ||
Number of insurance companies that filed claims | Insurance_company | 80 | ||
Loss Contingency, Number of Litigation Cases Scheduled for Trial | Litigation_case | 34 |
Segment Disclosures (Details)
Segment Disclosures (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Segment data | ||||
Net sales | $ 680 | $ 928 | $ 2,818 | $ 3,193 |
Cost of sales | 678 | 763 | 2,072 | 1,926 |
Gross margin | 2 | 165 | 746 | 1,267 |
Total other operating costs and expenses | 101 | 112 | 501 | 231 |
Equity in (losses) earnings of operating affiliates | (2) | 6 | (11) | 20 |
Operating (loss) earnings | (101) | 59 | 234 | 1,056 |
Operating Segments | Ammonia | ||||
Segment data | ||||
Net sales | 145 | 261 | 770 | 1,148 |
Cost of sales | 149 | 207 | 505 | 635 |
Gross margin | (4) | 54 | 265 | 513 |
Operating Segments | Granular Urea | ||||
Segment data | ||||
Net sales | 167 | 171 | 642 | 594 |
Cost of sales | 152 | 132 | 445 | 324 |
Gross margin | 15 | 39 | 197 | 270 |
Operating Segments | UAN | ||||
Segment data | ||||
Net sales | 212 | 349 | 891 | 1,112 |
Cost of sales | 218 | 276 | 646 | 678 |
Gross margin | (6) | 73 | 245 | 434 |
Operating Segments | AN | ||||
Segment data | ||||
Net sales | 103 | 80 | 318 | 179 |
Cost of sales | 114 | 97 | 316 | 179 |
Gross margin | (11) | (17) | 2 | 0 |
Operating Segments | Other | ||||
Segment data | ||||
Net sales | 53 | 67 | 197 | 160 |
Cost of sales | 45 | 51 | 160 | 110 |
Gross margin | $ 8 | $ 16 | $ 37 | $ 50 |
Condensed Consolidating Finan66
Condensed Consolidating Financial Statements (Details) - USD ($) $ in Millions | May 22, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 |
Condensed, Consolidating Statement of Operations | |||||
Less: Comprehensive income attributable to noncontrolling interests | $ 30 | $ 7 | $ 87 | $ 25 | |
Net sales | 680 | 928 | 2,818 | 3,193 | |
Cost of sales | 678 | 763 | 2,072 | 1,926 | |
Gross margin | 2 | 165 | 746 | 1,267 | |
Selling, general and administrative expenses | 44 | 42 | 141 | 120 | |
Transaction costs | $ 150 | 0 | 37 | 179 | 37 |
Other operating—net | 57 | 33 | 181 | 74 | |
Total other operating costs and expenses | 101 | 112 | 501 | 231 | |
Equity in (losses) earnings of operating affiliates | (2) | 6 | (11) | 20 | |
Operating (loss) earnings | (101) | 59 | 234 | 1,056 | |
Interest expense | 31 | 30 | 130 | 93 | |
Interest income | (2) | 0 | (4) | (1) | |
Net loss of wholly owned subsidiaries | 0 | 0 | |||
Other non-operating—net | 1 | 5 | (1) | 5 | |
(Loss) earnings before income taxes and equity in earnings of non-operating affiliates | (131) | 24 | 109 | 959 | |
Income tax benefit | (131) | 20 | (21) | 333 | |
Equity in earnings of non-operating affiliates—net of taxes | 0 | 93 | 0 | 72 | |
Net earnings | 0 | 97 | 130 | 698 | |
Less: Net earnings attributable to noncontrolling interests | 30 | 7 | 87 | 25 | |
Net (loss) earnings attributable to common stockholders | (30) | 90 | 43 | 673 | |
Reportable legal entities | Parent | |||||
Condensed, Consolidating Statement of Operations | |||||
Less: Comprehensive income attributable to noncontrolling interests | 0 | 0 | |||
Net sales | 0 | 0 | |||
Cost of sales | 0 | 0 | |||
Gross margin | 0 | 0 | |||
Selling, general and administrative expenses | 1 | 0 | 3 | 2 | |
Transaction costs | 30 | (46) | 30 | ||
Other operating—net | 0 | 0 | 0 | 0 | |
Total other operating costs and expenses | 1 | 30 | (43) | 32 | |
Equity in (losses) earnings of operating affiliates | 0 | 0 | |||
Operating (loss) earnings | (1) | (30) | 43 | (32) | |
Interest expense | 0 | 0 | |||
Interest income | 0 | 0 | |||
Net loss of wholly owned subsidiaries | 39 | (109) | (16) | (693) | |
Other non-operating—net | 0 | 0 | 0 | 0 | |
(Loss) earnings before income taxes and equity in earnings of non-operating affiliates | (40) | 79 | 59 | 661 | |
Income tax benefit | (10) | (11) | 16 | (12) | |
Equity in earnings of non-operating affiliates—net of taxes | 0 | ||||
Net earnings | (30) | 90 | 43 | 673 | |
Less: Net earnings attributable to noncontrolling interests | 0 | 0 | |||
Net (loss) earnings attributable to common stockholders | (30) | 90 | 43 | 673 | |
Reportable legal entities | CF Industries | |||||
Condensed, Consolidating Statement of Operations | |||||
Less: Comprehensive income attributable to noncontrolling interests | 0 | 0 | |||
Net sales | 80 | 78 | 283 | 270 | |
Cost of sales | 35 | 84 | 161 | 276 | |
Gross margin | 45 | (6) | 122 | (6) | |
Selling, general and administrative expenses | 4 | 3 | 8 | 4 | |
Transaction costs | 0 | ||||
Other operating—net | 5 | (4) | 5 | (9) | |
Total other operating costs and expenses | 9 | (1) | 13 | (5) | |
Equity in (losses) earnings of operating affiliates | 0 | 0 | |||
Operating (loss) earnings | 36 | (5) | 109 | (1) | |
Interest expense | 86 | 74 | 248 | 205 | |
Interest income | (12) | (22) | (42) | (37) | |
Net loss of wholly owned subsidiaries | 1 | (143) | (76) | (800) | |
Other non-operating—net | 0 | 0 | 0 | 0 | |
(Loss) earnings before income taxes and equity in earnings of non-operating affiliates | (39) | 86 | (21) | 631 | |
Income tax benefit | 0 | (24) | (37) | (63) | |
Equity in earnings of non-operating affiliates—net of taxes | 0 | 0 | |||
Net earnings | (39) | 110 | 16 | 694 | |
Less: Net earnings attributable to noncontrolling interests | 0 | 0 | |||
Net (loss) earnings attributable to common stockholders | (39) | 110 | 16 | 694 | |
Reportable legal entities | Other Subsidiaries | |||||
Condensed, Consolidating Statement of Operations | |||||
Less: Comprehensive income attributable to noncontrolling interests | 30 | 7 | 87 | 25 | |
Net sales | 713 | 983 | 2,942 | 3,380 | |
Cost of sales | 756 | 812 | 2,318 | 2,107 | |
Gross margin | (43) | 171 | 624 | 1,273 | |
Selling, general and administrative expenses | 39 | 39 | 130 | 114 | |
Transaction costs | 7 | 225 | 7 | ||
Other operating—net | 52 | 37 | 176 | 83 | |
Total other operating costs and expenses | 91 | 83 | 531 | 204 | |
Equity in (losses) earnings of operating affiliates | (2) | 6 | (11) | 20 | |
Operating (loss) earnings | (136) | 94 | 82 | 1,089 | |
Interest expense | (38) | (21) | (59) | (74) | |
Interest income | (7) | (1) | (21) | (2) | |
Net loss of wholly owned subsidiaries | 0 | 0 | |||
Other non-operating—net | 1 | 5 | (1) | 5 | |
(Loss) earnings before income taxes and equity in earnings of non-operating affiliates | (92) | 111 | 163 | 1,160 | |
Income tax benefit | (121) | 55 | 0 | 408 | |
Equity in earnings of non-operating affiliates—net of taxes | 93 | 72 | |||
Net earnings | 29 | 149 | 163 | 824 | |
Less: Net earnings attributable to noncontrolling interests | 30 | 7 | 87 | 25 | |
Net (loss) earnings attributable to common stockholders | (1) | 142 | 76 | 799 | |
Eliminations | |||||
Condensed, Consolidating Statement of Operations | |||||
Less: Comprehensive income attributable to noncontrolling interests | 0 | 0 | |||
Net sales | (113) | (133) | (407) | (457) | |
Cost of sales | (113) | (133) | (407) | (457) | |
Gross margin | 0 | 0 | 0 | ||
Selling, general and administrative expenses | 0 | 0 | 0 | ||
Transaction costs | 0 | ||||
Other operating—net | 0 | 0 | |||
Total other operating costs and expenses | 0 | 0 | 0 | ||
Equity in (losses) earnings of operating affiliates | 0 | 0 | |||
Operating (loss) earnings | 0 | 0 | |||
Interest expense | (17) | (23) | (59) | (38) | |
Interest income | 17 | 23 | 59 | 38 | |
Net loss of wholly owned subsidiaries | (40) | 252 | 92 | 1,493 | |
Other non-operating—net | 0 | 0 | |||
(Loss) earnings before income taxes and equity in earnings of non-operating affiliates | 40 | (252) | (92) | (1,493) | |
Income tax benefit | 0 | 0 | |||
Equity in earnings of non-operating affiliates—net of taxes | 0 | ||||
Net earnings | 40 | (252) | (92) | (1,493) | |
Less: Net earnings attributable to noncontrolling interests | 0 | 0 | |||
Net (loss) earnings attributable to common stockholders | $ 40 | $ (252) | $ (92) | $ (1,493) |
Condensed Consolidating Finan67
Condensed Consolidating Financial Statements (Details 2) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Condensed, Consolidating Statement of Comprehensive Income | ||||
Net (loss) earnings | $ 0 | $ 97 | $ 130 | $ 698 |
Other comprehensive loss | (30) | (8) | (23) | (54) |
Comprehensive (loss) income | (30) | 89 | 107 | 644 |
Less: Comprehensive income attributable to noncontrolling interests | 30 | 7 | 87 | 25 |
Comprehensive (loss) income attributable to common stockholders | (60) | 82 | 20 | 619 |
Reportable legal entities | Parent | ||||
Condensed, Consolidating Statement of Comprehensive Income | ||||
Net (loss) earnings | (30) | 90 | 43 | 673 |
Other comprehensive loss | (30) | (7) | (23) | (53) |
Comprehensive (loss) income | (60) | 83 | 20 | 620 |
Less: Comprehensive income attributable to noncontrolling interests | 0 | 0 | ||
Comprehensive (loss) income attributable to common stockholders | (60) | 83 | 20 | 620 |
Reportable legal entities | CF Industries | ||||
Condensed, Consolidating Statement of Comprehensive Income | ||||
Net (loss) earnings | (39) | 110 | 16 | 694 |
Other comprehensive loss | (30) | (8) | (23) | (54) |
Comprehensive (loss) income | (69) | 102 | (7) | 640 |
Less: Comprehensive income attributable to noncontrolling interests | 0 | 0 | ||
Comprehensive (loss) income attributable to common stockholders | (69) | 102 | (7) | 640 |
Reportable legal entities | Other Subsidiaries | ||||
Condensed, Consolidating Statement of Comprehensive Income | ||||
Net (loss) earnings | 29 | 149 | 163 | 824 |
Other comprehensive loss | (30) | (9) | (23) | (54) |
Comprehensive (loss) income | (1) | 140 | 140 | 770 |
Less: Comprehensive income attributable to noncontrolling interests | 30 | 7 | 87 | 25 |
Comprehensive (loss) income attributable to common stockholders | (31) | 133 | 53 | 745 |
Eliminations | ||||
Condensed, Consolidating Statement of Comprehensive Income | ||||
Net (loss) earnings | 40 | (252) | (92) | (1,493) |
Other comprehensive loss | 60 | 16 | 46 | 107 |
Comprehensive (loss) income | 100 | (236) | (46) | (1,386) |
Less: Comprehensive income attributable to noncontrolling interests | 0 | 0 | ||
Comprehensive (loss) income attributable to common stockholders | $ 100 | $ (236) | $ (46) | $ (1,386) |
Condensed Consolidating Finan68
Condensed Consolidating Financial Statements (Details 3) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets: | ||||
Cash and cash equivalents | $ 1,554 | $ 286 | $ 943 | $ 1,997 |
Restricted cash | 7 | 23 | ||
Accounts and notes receivable—net | 207 | 267 | ||
Inventories | 312 | 321 | ||
Prepaid income taxes | 830 | 185 | ||
Other current assets | 21 | 45 | ||
Total current assets | 2,931 | 1,127 | ||
Property, plant and equipment—net | 9,725 | 8,539 | ||
Investments in affiliates | 287 | 298 | ||
Due from affiliates | 0 | |||
Goodwill | 2,359 | 2,390 | ||
Other assets | 330 | 329 | ||
Total assets | 15,632 | 12,683 | ||
Current liabilities: | ||||
Accounts and notes payable and accrued expenses | 843 | 918 | ||
Income taxes payable | 1 | 5 | ||
Customer advances | 86 | 162 | ||
Other current liabilities | 36 | 130 | ||
Total current liabilities | 966 | 1,215 | ||
Long-term debt | 5,540 | 5,537 | ||
Deferred income taxes | 1,642 | 916 | ||
Due to affiliates | 0 | |||
Other liabilities | 504 | 628 | ||
Stockholders' equity: | ||||
Preferred stock | 0 | 0 | ||
Common stock | 2 | 2 | ||
Paid-in capital | 1,390 | 1,378 | ||
Retained earnings | 2,892 | 3,058 | ||
Treasury stock | (151) | (153) | ||
Accumulated other comprehensive loss | (273) | (250) | (214) | (160) |
Total stockholders' equity | 3,860 | 4,035 | ||
Noncontrolling interests | 3,120 | 352 | 356 | 363 |
Total equity | 6,980 | 4,387 | 4,467 | 4,572 |
Total liabilities and equity | 15,632 | 12,683 | ||
Reportable legal entities | Parent | ||||
Current assets: | ||||
Cash and cash equivalents | 0 | 1 | 1 | 0 |
Accounts and notes receivable—net | 0 | 1 | ||
Prepaid income taxes | 0 | 0 | ||
Total current assets | 0 | 2 | ||
Property, plant and equipment—net | 0 | |||
Investments in affiliates | 4,156 | 4,303 | ||
Due from affiliates | 571 | 571 | ||
Goodwill | 0 | |||
Total assets | 4,727 | 4,876 | ||
Current liabilities: | ||||
Accounts and notes payable and accrued expenses | 867 | 841 | ||
Other current liabilities | 0 | 0 | ||
Total current liabilities | 867 | 841 | ||
Stockholders' equity: | ||||
Preferred stock | 0 | |||
Common stock | 2 | 2 | ||
Paid-in capital | 1,390 | 1,378 | ||
Retained earnings | 2,892 | 3,058 | ||
Treasury stock | (151) | (153) | ||
Accumulated other comprehensive loss | (273) | (250) | ||
Total stockholders' equity | 3,860 | 4,035 | ||
Noncontrolling interests | 0 | |||
Total equity | 3,860 | 4,035 | ||
Total liabilities and equity | 4,727 | 4,876 | ||
Reportable legal entities | CF Industries | ||||
Current assets: | ||||
Cash and cash equivalents | 5 | 0 | 4 | 106 |
Accounts and notes receivable—net | 1,316 | 2,987 | ||
Inventories | 0 | 0 | ||
Prepaid income taxes | 0 | 0 | ||
Other current assets | 0 | 24 | ||
Total current assets | 1,321 | 3,011 | ||
Property, plant and equipment—net | 0 | |||
Investments in affiliates | 9,632 | 8,148 | ||
Due from affiliates | 0 | |||
Other assets | 18 | 19 | ||
Total assets | 10,971 | 11,178 | ||
Current liabilities: | ||||
Accounts and notes payable and accrued expenses | 556 | 648 | ||
Income taxes payable | 0 | 0 | ||
Customer advances | 0 | |||
Other current liabilities | 0 | 0 | ||
Total current liabilities | 556 | 648 | ||
Long-term debt | 5,540 | 5,537 | ||
Deferred income taxes | 81 | 52 | ||
Due to affiliates | 573 | 573 | ||
Other liabilities | 65 | 66 | ||
Stockholders' equity: | ||||
Common stock | 0 | |||
Paid-in capital | (13) | (13) | ||
Retained earnings | 4,442 | 4,565 | ||
Treasury stock | 0 | |||
Accumulated other comprehensive loss | (273) | (250) | ||
Total stockholders' equity | 4,156 | 4,302 | ||
Noncontrolling interests | 0 | |||
Total equity | 4,156 | 4,302 | ||
Total liabilities and equity | 10,971 | 11,178 | ||
Reportable legal entities | Other Subsidiaries | ||||
Current assets: | ||||
Cash and cash equivalents | 1,549 | 285 | 938 | 1,891 |
Restricted cash | 7 | 23 | ||
Accounts and notes receivable—net | 1,517 | 1,565 | ||
Inventories | 312 | 321 | ||
Prepaid income taxes | 830 | 185 | ||
Other current assets | 21 | 21 | ||
Total current assets | 4,236 | 2,400 | ||
Property, plant and equipment—net | 9,725 | 8,539 | ||
Investments in affiliates | 287 | 298 | ||
Due from affiliates | 2 | 2 | ||
Goodwill | 2,359 | 2,390 | ||
Other assets | 312 | 310 | ||
Total assets | 16,921 | 13,939 | ||
Current liabilities: | ||||
Accounts and notes payable and accrued expenses | 2,046 | 3,715 | ||
Income taxes payable | 1 | 5 | ||
Customer advances | 86 | 162 | ||
Other current liabilities | 36 | 130 | ||
Total current liabilities | 2,169 | 4,012 | ||
Long-term debt | 0 | |||
Deferred income taxes | 1,561 | 864 | ||
Other liabilities | 439 | 562 | ||
Stockholders' equity: | ||||
Preferred stock | 16 | 17 | ||
Common stock | 1 | 1 | ||
Paid-in capital | 9,936 | 8,365 | ||
Retained earnings | (48) | 16 | ||
Treasury stock | 0 | |||
Accumulated other comprehensive loss | (273) | (250) | ||
Total stockholders' equity | 9,632 | 8,149 | ||
Noncontrolling interests | 3,120 | 352 | ||
Total equity | 12,752 | 8,501 | ||
Total liabilities and equity | 16,921 | 13,939 | ||
Eliminations | ||||
Current assets: | ||||
Cash and cash equivalents | 0 | 0 | $ 0 | $ 0 |
Accounts and notes receivable—net | (2,626) | (4,286) | ||
Inventories | 0 | |||
Prepaid income taxes | 0 | 0 | ||
Total current assets | (2,626) | (4,286) | ||
Investments in affiliates | (13,788) | (12,451) | ||
Due from affiliates | (573) | (573) | ||
Goodwill | 0 | |||
Total assets | (16,987) | (17,310) | ||
Current liabilities: | ||||
Accounts and notes payable and accrued expenses | (2,626) | (4,286) | ||
Income taxes payable | 0 | 0 | ||
Customer advances | 0 | |||
Other current liabilities | 0 | 0 | ||
Total current liabilities | (2,626) | (4,286) | ||
Long-term debt | 0 | |||
Deferred income taxes | 0 | 0 | ||
Due to affiliates | (573) | (573) | ||
Stockholders' equity: | ||||
Preferred stock | (16) | (17) | ||
Common stock | (1) | (1) | ||
Paid-in capital | (9,923) | (8,352) | ||
Retained earnings | (4,394) | (4,581) | ||
Treasury stock | 0 | |||
Accumulated other comprehensive loss | 546 | 500 | ||
Total stockholders' equity | (13,788) | (12,451) | ||
Noncontrolling interests | 0 | |||
Total equity | (13,788) | (12,451) | ||
Total liabilities and equity | $ (16,987) | $ (17,310) |
Condensed Consolidating Finan69
Condensed Consolidating Financial Statements (Details 4) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Operating Activities: | ||||
Net earnings | $ 0 | $ 97 | $ 130 | $ 698 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||||
Depreciation and amortization | 475 | 348 | ||
Deferred income taxes | 730 | (6) | ||
Stock-based compensation expense | 15 | 13 | ||
Unrealized (gain) loss on natural gas and foreign currency derivatives | (169) | 70 | ||
Loss on sale of equity method investments | 0 | 43 | ||
Unrealized loss on embedded derivative | 22 | 0 | ||
Gain on remeasurement of CF Fertilisers UK investment | 0 | (94) | ||
Loss on disposal of property, plant and equipment | 8 | 18 | ||
Undistributed earnings of affiliates—net | 0 | (2) | ||
Due to/from affiliates—net | 0 | |||
Changes in: | ||||
Accounts and notes receivable—net | 55 | 16 | ||
Inventories | (4) | (72) | ||
Accrued and prepaid income taxes | (665) | (69) | ||
Accounts and notes payable and accrued expenses | (7) | 32 | ||
Customer advances | (75) | 56 | ||
Other—net | 76 | 23 | ||
Net cash provided by operating activities | 591 | 1,074 | ||
Investing Activities: | ||||
Additions to property, plant and equipment | (1,819) | (1,791) | ||
Proceeds from sale of property, plant and equipment | 8 | 9 | ||
Proceeds from sale of equity method investment | 0 | 13 | ||
Purchase of CF Fertilisers UK, net of cash acquired | 0 | (554) | ||
Withdrawals from restricted cash funds | 16 | 60 | ||
Other—net | 4 | (36) | ||
Net cash used in investing activities | (1,791) | (2,299) | ||
Financing Activities: | ||||
Proceeds from long-term borrowings | 0 | 1,000 | ||
Proceeds from short-term borrowings | 150 | 367 | ||
Short-term debt—net | 0 | 0 | ||
Payments of short-term borrowings | (150) | (367) | ||
Financing fees | (11) | (28) | ||
Dividends paid on common stock | (209) | (212) | ||
Dividends to/from affiliates | 0 | 0 | ||
Issuance of noncontrolling interest in CFN | 2,800 | 0 | ||
Distributions to noncontrolling interests | (111) | (32) | ||
Purchases of treasury stock | 0 | (556) | ||
Issuances of common stock under employee stock plans | 0 | 8 | ||
Shares withheld for taxes | 0 | (1) | ||
Other—net | 0 | |||
Net cash provided by financing activities | 2,469 | 179 | ||
Effect of exchange rate changes on cash and cash equivalents | (1) | (8) | ||
Increase (decrease) in cash and cash equivalents | 1,268 | (1,054) | ||
Cash and cash equivalents at beginning of period | 286 | 1,997 | ||
Cash and cash equivalents at end of period | 1,554 | 943 | 1,554 | 943 |
Reportable legal entities | Parent | ||||
Operating Activities: | ||||
Net earnings | (30) | 90 | 43 | 673 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||||
Depreciation and amortization | 0 | 0 | ||
Deferred income taxes | 0 | 0 | ||
Stock-based compensation expense | 14 | 13 | ||
Unrealized (gain) loss on natural gas and foreign currency derivatives | 0 | 0 | ||
Unrealized loss on embedded derivative | 0 | |||
Loss on disposal of property, plant and equipment | 0 | 0 | ||
Undistributed earnings of affiliates—net | (16) | (693) | ||
Due to/from affiliates—net | 2 | |||
Changes in: | ||||
Accounts and notes receivable—net | 1 | 0 | ||
Inventories | 0 | 0 | ||
Accrued and prepaid income taxes | 0 | 2 | ||
Accounts and notes payable and accrued expenses | (9) | 6 | ||
Customer advances | 0 | 0 | ||
Other—net | 0 | 0 | ||
Net cash provided by operating activities | 33 | 3 | ||
Investing Activities: | ||||
Additions to property, plant and equipment | 0 | 0 | ||
Proceeds from sale of property, plant and equipment | 0 | 0 | ||
Withdrawals from restricted cash funds | 0 | 0 | ||
Other—net | 0 | 0 | ||
Net cash used in investing activities | 0 | 0 | ||
Financing Activities: | ||||
Proceeds from long-term borrowings | 0 | |||
Short-term debt—net | 35 | 546 | ||
Financing fees | 0 | 0 | ||
Dividends paid on common stock | (209) | (212) | ||
Dividends to/from affiliates | 140 | 212 | ||
Issuance of noncontrolling interest in CFN | 0 | |||
Distributions to noncontrolling interests | 0 | 0 | ||
Purchases of treasury stock | (556) | |||
Issuances of common stock under employee stock plans | 8 | |||
Shares withheld for taxes | 0 | |||
Other—net | 0 | |||
Net cash provided by financing activities | (34) | (2) | ||
Effect of exchange rate changes on cash and cash equivalents | 0 | 0 | ||
Increase (decrease) in cash and cash equivalents | (1) | 1 | ||
Cash and cash equivalents at beginning of period | 1 | 0 | ||
Cash and cash equivalents at end of period | 0 | 1 | 0 | 1 |
Reportable legal entities | CF Industries | ||||
Operating Activities: | ||||
Net earnings | (39) | 110 | 16 | 694 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||||
Depreciation and amortization | 9 | 11 | ||
Deferred income taxes | 29 | 30 | ||
Stock-based compensation expense | 0 | 0 | ||
Unrealized (gain) loss on natural gas and foreign currency derivatives | 0 | 0 | ||
Unrealized loss on embedded derivative | 0 | |||
Loss on disposal of property, plant and equipment | 0 | 0 | ||
Undistributed earnings of affiliates—net | (76) | (800) | ||
Due to/from affiliates—net | 0 | |||
Changes in: | ||||
Accounts and notes receivable—net | 178 | 18 | ||
Inventories | 0 | 0 | ||
Accrued and prepaid income taxes | 0 | (10) | ||
Accounts and notes payable and accrued expenses | (34) | (79) | ||
Customer advances | 0 | 0 | ||
Other—net | 0 | 0 | ||
Net cash provided by operating activities | 122 | (136) | ||
Investing Activities: | ||||
Additions to property, plant and equipment | 0 | 0 | ||
Proceeds from sale of property, plant and equipment | 0 | 0 | ||
Withdrawals from restricted cash funds | 0 | 0 | ||
Other—net | 0 | (82) | ||
Net cash used in investing activities | 0 | (82) | ||
Financing Activities: | ||||
Proceeds from long-term borrowings | 1,000 | |||
Short-term debt—net | (112) | (856) | ||
Financing fees | (5) | (28) | ||
Dividends paid on common stock | (140) | (212) | ||
Dividends to/from affiliates | 140 | 212 | ||
Issuance of noncontrolling interest in CFN | 0 | |||
Distributions to noncontrolling interests | 0 | 0 | ||
Purchases of treasury stock | 0 | |||
Issuances of common stock under employee stock plans | 0 | |||
Shares withheld for taxes | 0 | |||
Other—net | 0 | |||
Net cash provided by financing activities | (117) | 116 | ||
Effect of exchange rate changes on cash and cash equivalents | 0 | 0 | ||
Increase (decrease) in cash and cash equivalents | 5 | (102) | ||
Cash and cash equivalents at beginning of period | 0 | 106 | ||
Cash and cash equivalents at end of period | 5 | 4 | 5 | 4 |
Reportable legal entities | Other Subsidiaries | ||||
Operating Activities: | ||||
Net earnings | 29 | 149 | 163 | 824 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||||
Depreciation and amortization | 466 | 337 | ||
Deferred income taxes | 701 | (36) | ||
Stock-based compensation expense | 1 | 0 | ||
Unrealized (gain) loss on natural gas and foreign currency derivatives | (169) | 70 | ||
Loss on sale of equity method investments | 43 | |||
Unrealized loss on embedded derivative | 22 | |||
Gain on remeasurement of CF Fertilisers UK investment | (94) | |||
Loss on disposal of property, plant and equipment | 8 | 18 | ||
Undistributed earnings of affiliates—net | 0 | (2) | ||
Due to/from affiliates—net | (2) | |||
Changes in: | ||||
Accounts and notes receivable—net | (61) | 141 | ||
Inventories | (4) | (72) | ||
Accrued and prepaid income taxes | (665) | (61) | ||
Accounts and notes payable and accrued expenses | (27) | (38) | ||
Customer advances | (75) | 56 | ||
Other—net | 76 | 23 | ||
Net cash provided by operating activities | 436 | 1,207 | ||
Investing Activities: | ||||
Additions to property, plant and equipment | (1,819) | (1,791) | ||
Proceeds from sale of property, plant and equipment | 8 | 9 | ||
Proceeds from sale of equity method investment | 13 | |||
Purchase of CF Fertilisers UK, net of cash acquired | (554) | |||
Withdrawals from restricted cash funds | 16 | 60 | ||
Other—net | 4 | (36) | ||
Net cash used in investing activities | (1,791) | (2,299) | ||
Financing Activities: | ||||
Proceeds from long-term borrowings | 0 | |||
Short-term debt—net | 77 | 310 | ||
Financing fees | (6) | 0 | ||
Dividends paid on common stock | (140) | (212) | ||
Dividends to/from affiliates | 0 | 0 | ||
Issuance of noncontrolling interest in CFN | 2,800 | |||
Distributions to noncontrolling interests | (111) | (32) | ||
Purchases of treasury stock | 0 | |||
Issuances of common stock under employee stock plans | 0 | |||
Shares withheld for taxes | (1) | |||
Other—net | 82 | |||
Net cash provided by financing activities | 2,620 | 147 | ||
Effect of exchange rate changes on cash and cash equivalents | (1) | (8) | ||
Increase (decrease) in cash and cash equivalents | 1,264 | (953) | ||
Cash and cash equivalents at beginning of period | 285 | 1,891 | ||
Cash and cash equivalents at end of period | 1,549 | 938 | 1,549 | 938 |
Eliminations | ||||
Operating Activities: | ||||
Net earnings | 40 | (252) | (92) | (1,493) |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||||
Depreciation and amortization | 0 | 0 | ||
Deferred income taxes | 0 | 0 | ||
Stock-based compensation expense | 0 | 0 | ||
Unrealized (gain) loss on natural gas and foreign currency derivatives | 0 | 0 | ||
Unrealized loss on embedded derivative | 0 | |||
Loss on disposal of property, plant and equipment | 0 | 0 | ||
Undistributed earnings of affiliates—net | 92 | 1,493 | ||
Due to/from affiliates—net | 0 | |||
Changes in: | ||||
Accounts and notes receivable—net | (63) | (143) | ||
Inventories | 0 | 0 | ||
Accrued and prepaid income taxes | 0 | 0 | ||
Accounts and notes payable and accrued expenses | 63 | 143 | ||
Customer advances | 0 | 0 | ||
Other—net | 0 | 0 | ||
Net cash provided by operating activities | 0 | 0 | ||
Investing Activities: | ||||
Additions to property, plant and equipment | 0 | 0 | ||
Proceeds from sale of property, plant and equipment | 0 | 0 | ||
Withdrawals from restricted cash funds | 0 | 0 | ||
Other—net | 0 | 82 | ||
Net cash used in investing activities | 0 | 82 | ||
Financing Activities: | ||||
Proceeds from long-term borrowings | 0 | |||
Short-term debt—net | 0 | 0 | ||
Financing fees | 0 | 0 | ||
Dividends paid on common stock | 280 | 424 | ||
Dividends to/from affiliates | (280) | (424) | ||
Issuance of noncontrolling interest in CFN | 0 | |||
Distributions to noncontrolling interests | 0 | 0 | ||
Purchases of treasury stock | 0 | |||
Issuances of common stock under employee stock plans | 0 | |||
Shares withheld for taxes | 0 | |||
Other—net | (82) | |||
Net cash provided by financing activities | 0 | (82) | ||
Effect of exchange rate changes on cash and cash equivalents | 0 | 0 | ||
Increase (decrease) in cash and cash equivalents | 0 | 0 | ||
Cash and cash equivalents at beginning of period | 0 | 0 | ||
Cash and cash equivalents at end of period | $ 0 | $ 0 | $ 0 | $ 0 |
Subsequent Events (Details)
Subsequent Events (Details) - CF Industries | 3 Months Ended | |||||||||
Dec. 31, 2016USD ($) | Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Oct. 31, 2016USD ($) | Sep. 30, 2016 | Jul. 29, 2016USD ($) | |
Line of Credit | Letter of Credit | July 2016 Credit Agreement Amendment | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Maximum borrowing capacity | $ 100,000,000 | |||||||||
Line of Credit | Revolving Credit Facility | July 2016 Credit Agreement Amendment | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Maximum borrowing capacity | $ 1,500,000,000 | |||||||||
Ratio of Indebtedness to Net Capital | 5.25 | |||||||||
Scenario, Forecast | Senior Notes | Private Placement Senior Notes | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Repayment in full of senior debt | $ 1,000,000,000 | |||||||||
Prepayment of senior debt | $ 210,000,000 | |||||||||
Scenario, Forecast | Line of Credit | Revolving Credit Facility | July 2016 Credit Agreement Amendment | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Ratio of Indebtedness to Net Capital | 5.25 | 4 | 4.75 | 5 | 5.25 | |||||
Scenario, Forecast | Line of Credit | Revolving Credit Facility | Amendment Revolving Credit Agreement | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Ratio of EBITDA to interest expense | 1.50 | |||||||||
Scenario, Forecast | Maximum | Senior Notes | Private Placement Senior Notes | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Ratio of Indebtedness to Net Capital | 3.75 | |||||||||
Subsequent Event | Line of Credit | Revolving Credit Facility | Amendment Revolving Credit Agreement | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Maximum borrowing capacity | $ 800,000,000 | |||||||||
Threshold of potential guarantor obligation | $ 150,000,000 | |||||||||
Ratio of Indebtedness to Net Capital | 0.60 | |||||||||
Credit rating covenant ratio of Indebtedness to EBITDA | 3.75 | |||||||||
Subsequent Event | Line of Credit | Secured Bilateral LC Facilities and Secured Swap Agreements | Amendment Revolving Credit Agreement | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Threshold of potential guarantor obligation | $ 300,000,000 | |||||||||
Subsequent Event | Letters of Credit, Letters of Guaranty and Surety Bonds | Revolving Credit Facility | Amendment Revolving Credit Agreement | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Threshold of potential guarantor obligation | $ 300,000,000 | |||||||||
Subsequent Event | Maximum | Line of Credit | Revolving Credit Facility | Amendment Revolving Credit Agreement | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Ratio of Indebtedness to EBITDA | 3.75 | |||||||||
Subsequent Event | Minimum | Line of Credit | Revolving Credit Facility | Amendment Revolving Credit Agreement | ||||||||||
Subsequent Event [Line Items] | ||||||||||
Ratio of EBITDA to interest expense | 1.20 | |||||||||
Credit rating covenant ratio of EBITDA to interest expense | 2.75 |