* Sees Q4 profit just above $2/shr, Street view $1.73/shr
* Strong North American fertilizer demand boosts results
* Agrium shares rise more than 3 pct on NYSE, TSX
By Euan Rocha
TORONTO, Jan 24 Canada's Agrium Inc
raised its fourth-quarter earnings outlook on
Thursday as strong grain and oilseed prices spurred demand for
its fertilizer products in North America over the fall season.
The Calgary, Alberta-based fertilizer maker, also the
largest retailer of farm products in the region, said it now
expects quarterly earnings of slightly more than $2 a share,
excluding one-time items, sending its shares more than 3 percent
higher in early trading.
Agrium, under pressure from activist shareholder Jana
Partners to split its retail and wholesale arms and make other
changes to improve returns, had forecast earnings of $1.50 to
$1.90 a share for the period.
Analysts, on average, were expecting $1.73 a share,
according to Thomson Reuters I/B/E/S.
Agrium is set to announce detailed fourth-quarter and
full-year results on Feb. 22.
"Going forward, continued strength in crop prices and low
global grain inventories are anticipated to support a strong
spring application season in 2013," Chief Executive Mike Wilson
said in a statement. He was referring to the early spring, when
farmers begin to plant new crops.
Agrium is hosting an analyst day in New York on Jan. 28,
when it is expected to provide a detailed review of its retail
Despite pressure from Jana, its largest shareholder, Agrium
has refused to consider spinning off the retail arm. It says the
business helps with cost savings and provides a wealth of market
insight and an earnings buffer in a cyclical industry.
Jana, which has named a slate of nominees for election to
Agrium's board, says the company has only addressed the split-up
proposal, but not issues like cost controls and its concerns
about capital allocation.
"Agrium's board has been living in an alternate universe
where shareholders have no desire to explore the many ways we've
identified to unlock value," Jana Managing Partner Barry
Rosenstein said in a statement issued on Wednesday.
AltaCorp Capital analyst John Chu said Jana does make some
valid points on the lack of agriculture and retail expertise on
Agrium's board and the need to improve disclosure around the
"However, we are still not fully convinced at this time that
breaking out the retail division is necessary to realize these
objectives," Chu said in a note to clients on Thursday.
Agrium rose 2.8 percent at $114.02 in New York, and its
Toronto-listed shares added 3.3 percent to C$114.28. The stock
has risen nearly 40 percent over the last 12 months.
Dundee Securities analyst Carolyn Dennis, who has a C$116
price target on the stock, believes Agrium's shares still have
room to run.
"While our return to target has diminished, we continue to
expect more upside at Agrium, primarily driven by the retail
segment," Dennis said in a note to clients.