Nutrien Ltd.

and prospects contain forward looking information. Certain assumptions were applied in making these conclusions and forecasts, therefore actual results could differ materially from those contained in our forward looking information. Additional information about these factors and assumptions is contained in our quarterly report to shareholders, as well as our most recent annual report, MD&A and annual information form. I will now turn the call over to Ken Sites, nutrients president and CEO, and Mark Thompson, our CFO, for opening comments.

Good morning. Thank you for joining us today as we review our Q1 performance, strategic priorities, and the outlook for our business. Nutrients first quarter results were supported by the execution of operational efficiency and cost savings initiatives. We maintained our 2025 full year guidance ranges as operating performance and capital allocation priorities are consistent with previous expectations. In recent months, geopolitical events and trade disruptions have created volatility in global financial markets. However, to this point, these issues have not impacted the outlook for our business. Fertilizer market fundamentals have strengthened, supported by strong global demand and tight supplies. Canadian fertilizer products that are critical for crop production and food security continue to move across the border tariff free. And our downstream retail network is well positioned on fertilizer and crop protection supplies to meet demand for the current growing season. US farmers intend to increase corn acres by approximately 5% in 2025, which is positive for crop input demand. We're seeing strong fertilizer application rates this spring, and our US retail fertilizer sales volumes were up 8% in April compared to the same period in 2024. As we plan for the remainder of the year, we will continue to position our supply chain to efficiently serve our grow customers in a dynamic market environment. Now turning to potash, global supply and demand fundamentals have strengthened significantly as spot market prices have increased by 10 to 20% since the beginning of 2025. We have maintained our annual global potash shipment forecast in a range of 71 to 75 million tons, with the current level of demand testing existing global operating and supply chain capabilities. CAFE-Tex is fully committed for the second quarter due to strong demand in all major offshore spot markets. In China, a step change in potash consumption in recent years, combined with lower imports to begin 2025, has led to an estimated 1.1 million ton reduction in its strategic reserve. We anticipate favorable consumption trends, and lower inventories will support strong import requirements in the second half of the year. Global urea and nitrogen solutions markets have also strengthened considerably in 2025, due to seasonal demand and supply restrictions. In the US, the combination of higher corn acres and limited nitrogen applications this past fall is supporting demand, while trade flow shifts and constrained logistics have impacted supplies. Nutrien is well positioned to optimize product mix from our low-cost nitrogen network to meet demand this spring. Beyond the fundamentals, our focus is to enhance our core business across the ag value chain and progress towards our 2026 performance targets, which provide a pathway for driving structural improvements to our earnings and free cash flow. In our upstream business, we are leveraging our world-class asset base to bring on incremental, low-cost fertilizer volumes as demand grows. This includes initiatives that enhance the safety, reliability, and low-cost position of our assets. Investments in our midstream distribution network will continue to be a priority to ensure we can efficiently serve our customers and support our growth objectives over the long term. Trade disruptions in recent years have further highlighted the importance of our leading global supply chain. In our downstream retail business, we have well-defined growth opportunities, including expansion of our proprietary products business, execution of network optimization projects, and tuck-in acquisitions. In the first quarter, we completed two acquisitions in the U.S., adding high-quality assets with a strong strategic fit within our retail network. Through actions to simplify our business and focus on core assets and markets, we have made meaningful progress on our cost savings and capital expenditure targets. We remain on track to achieve our $200 million target for consolidated annual cost savings in 2025, one year earlier than the original goal. We have further optimized capital this year, with planned expenditures down more than $500 million compared to 2023 levels. In addition, the divestiture of non-core assets has provided us with incremental cash flow. In the first quarter, we divested our remaining position in Sinofer, which was a passive equity ownership stake. Total proceeds from the divestiture during the fourth quarter of last year and the first quarter of 2025 amounted to $223 million. These actions further support nutrients' ability to deploy capital towards high conviction priorities that improve earnings and free cash flow per share through the cycle. I will now turn it over to Mark to review our Q1 results, 2025 guidance, and provide additional details on our capital allocation priorities.

Thanks, Ken. As Ken described, our operating performance has progressed in line with our previous expectations. In the first quarter, which is typically a seasonally slower period for our downstream retail business, Nutrien delivered adjusted EBITDA of $852 million. Retail-adjusted EBITDA totaled $46 million, as weather-related delays reduced crop input sales in the U.S. and Australia. Retail expenses were down 5% compared to the prior year as we progressed cost savings initiatives. In Brazil, we are demonstrating greater stability in our business performance, supported by the execution of our margin improvement plans. We maintained our full-year retail-adjusted EBITDA guidance range of $1.65 to $1.85 billion. Given the pace of field activity through early May, we expect the slower start to applications in the first quarter will be made up in the second quarter. At the midpoint of our annual range, we anticipate -over-year growth in crop nutrient sales volumes, increased proprietary products gross margin, and continued recovery in Brazil, partially offset by a return to historical average crop protection product margins. In Potash, we delivered adjusted EBITDA of $446 million in the first quarter, down from the prior year due to lower net selling prices. A realized Potash price in North America reflected the reset in values for the winter fill program, while the improvement in our offshore selling price was driven by higher international benchmark values and lower logistics costs. Our North American reference price increased three times following the completion of our winter fill program, which we expect will support higher domestic selling prices in the second quarter. We utilized our extensive midstream distribution network to deliver 3.4 million tons of Potash in the first quarter, similar to the record levels sold in the same period of 2024. We expect annual Potash sales volumes of 13.6 to 14.4 million tons in line with our historical average share of global shipments. Our nitrogen operating segment generated adjusted EBITDA of $408 million in the first quarter, down from the prior year due to higher natural gas costs and lower equity earnings from our investment in pro-fertile. Benchmark prices for urea and other upgraded nitrogen products have strengthened since the beginning of the year, while ammonia values have declined from historically strong levels in the fourth quarter of 2024. Our ammonia operating rate increased to 98% in the first quarter, supported by reduced maintenance downtime and improved reliability at our sites. We expect annual nitrogen sales volumes in the range of 10.7 to 11.2 million tons, with higher quarterly volumes for the remainder of 2025 compared to the prior year. Given the recent volatility in global natural gas markets, we now project Henry Hubb natural gas prices to average between $3.25 and $4 per MMBTU in 2025. Our Western Canadian nitrogen plants continue to benefit from low gas costs due to a wider price spread to Henry Hubb compared to historical average levels. In phosphate, we generated adjusted EBITDA of $61 million in the first quarter, down from the prior year, primarily due to the impact of lower production volumes and higher input costs. We continue to expect lower production levels in the first half of 2025 compared to last year, and improved operating rates in the second half following the completion of planned turnaround activity. Our capital allocation priorities also remain consistent. We are focused on initiatives that support the achievement of our 2026 performance targets, optimizing investments in working capital, and continuing to review non-core assets on our balance sheet, all of which we expect will enhance sources of cash flow over time. From a uses of cash perspective, we've committed $2 to $2.1 billion in capital to sustain safe and reliable operations and to progress a set of targeted growth investments that are aligned to the priorities that Ken previously described. This includes investments in our proprietary products business, retail network optimization, nitrogen to bottleneck projects, and potash mine automation. In February, we indicated that additional free cash flow in 2025 would be allocated to a narrow set of incremental growth opportunities and to share repurchases. Priorities that we expect will increase free cash flow per share. We've deployed capital on both fronts in 2025, completing two U.S. retail acquisitions in the 2020-2026 year, and we intend to continue to purchase shares on a roundtable basis under our renewed NCIP program that's authorized until the end of February 2026. I'll now turn it back to Ken. Thanks,

Mark. To summarize, we have a constructive outlook for our business as global fertilizer market fundamentals have tightened in 2025, supported by growing demand and tight supplies. We continue to monitor potential risks related to trade disruptions and have built a resilient business that is well positioned to respond under any scenario. We are taking a disciplined and intentional approach to capital allocation, prioritizing high value investment opportunities, divesting non-core assets, and returning cash to shareholders. We have demonstrated progress in each of these areas in 2025, and will continue to focus on actions within our control that we believe maximize long-term value for our shareholders. We would now be happy to take your questions.

Thank you, ladies and gentlemen. We will now begin the question and answer session. Should you have a question, please press star followed by the number one on your touchtone phone. You will hear a prompt that your hand has been raised. Should you wish to withdraw your question, please press star followed by the number two. If you are using a speakerphone, please lift the handset before pressing any keys. The first question comes from Joel Jackson from BMO Capital Markets. Please go ahead.

Hi, good morning, everyone. So you don't give guidance, you know, free badaw, you give it just to retail. And I don't want to give you guidance, I want you to. What I want to ask you is this, if I look at versus three months ago, what you had for your commodity price and what you would have thought three months ago, what would you expect? And don't even tell us that. But would you agree that if you mark to market your earnings, you know, you would expect that you are looking at a higher outlook now than you would have thought three months ago because all the commodity prices have moved to good US spring. Like, could you talk about that, that the outlook is improving or not, where you should be earning more than maybe what you would have thought three months ago? And you're not going to tell us what those numbers are enough. Thanks.

Yeah. Good morning, Joel. Yeah, thank you for the question. The short answer is yes, we agree with your assessment of now versus three months ago. And, you know, it's related to a number of things. And it does go back to what we're seeing across what we do, the strength of demand across fertilizer products. And we can talk about Potash where we issued an RV of 71 to 75 million tons of demand this year. And what we're seeing, we believe, is the intersection of the market, the ability to supply that. So that'd be the supply stack and logistics constraints. And so that as a result, we are seeing strengthening of price in every market that we serve. I mean, even in our own domestic volumes, we have increased the price three times since our winter fill program. To your point, that's within the last three months, Joel. We're 90% committed through Q2 in our domestic volumes and fully committed with Campotex through Q2. So, you know, we can talk about what's happening in UREA and UAN where we've seen supply disruptions and strong demand. You know, with our retail business, we've talked about it's a story of haves as opposed to quarters. And where we, with some weather delays in the first quarter, we're now about 50% planted in. You know, we can add it over to Jeff Tarsie. Things are going strong with the planting season now when we're seeing significant volume go to ground. So we're very encouraged by what we're seeing at the moment. So, again, Joel, it's just to say that we agree with you. It's certainly constructive on the balance of the year.

Your next question comes from Andrew Wong from RBC Capital Markets. Please go ahead. Hey, good morning. Thanks for taking

my questions. So maybe can you provide an update on Brazil retail? Are we on track to see that business get back to break even? And just going forward, now that you spent some time on the turnaround in Brazil, what does that look like for Nutrien as you kind of get into, like, let's say 2026 and beyond?

Yeah, thanks, Andrew. So, again, the short answer is yes, we are on track. I mean, at the macro level, Brazilian farmer had a strong soybean crop and soybean prices strengthened. Of course, they're watching their Saphiria corn crop grow at the moment, but all indications are that it will be a strong corn crop as well. So Brazilian farmers in a bit better place. And, of course, you combine that with what we've been doing with our own business. And we've talked about idling blenders. We've talked about headcount reduction. We've talked about closure of unproductive locations, how we're focusing on collections, how we're focusing on proprietary products, and that whole plan to bring us back to a cash neutral position this year, which is absolutely on track. Jeff, do you want to say a few words about that?

Yeah, and I'll just reiterate, again, some of the comments that you made from a macro standpoint. The growers came off very strong soybean yields there with soybean harvest. They got off to a good start with the second crop corn, and that's progressing nicely. Not a lot of weather scares there in that market. We have seen, as we saw last year, we continue to see pressure in that crop protection market, a big influence of generics in that market as well. And our focus with our business, as Ken just stated, we're really focused very intently on our controllables, expense management, a heavy, heavy focus on margins. We've been very focused on bringing our inventory down, and we've been successful at that. And then, again, a lot of attention to our receivable books. And we expect to deliver a notable improvement over last year. We're starting to see those benefits start to show up from a margin standpoint and from an expense standpoint as well. And we plan to carry that momentum forward through the remainder of the year. Ken's mentioned that we've idled our lending facilities, and we've taken out our assets that weren't giving us return from whether we're talking about locations or experience centers. And we reduced our headcount by about 400. So we've done a lot of work there over the last 12 to 18 months, and we're starting to see the results of that. Thanks, Joe.

And Andrew, as we look into 2026, I think you can expect more of the same. It'll be watching the market evolution of the health of the Brazilian farmer. And at the same time, us continuing to execute on our improvement plan. I think Jeff, fair to say we're watching crop chemistry quite closely. If there's one shelf of ours that hasn't caught up yet is on chemistry. And we'll be looking into 2026 to see that. But we're still seeing competition from generics, and that's certainly stressing prices in that part of the world. Yeah,

Ken, I failed to mention. I don't want to leave this out. We still see a lot of opportunity on the proprietary product side of our business, especially with our plant, nutritionals and biological products, and as well on the proprietary seed side of business. So we're very focused in those two areas.

Your next question comes from Vincent Andrews from Morgan Stanley. Please go ahead.

Sorry, thank you. Could you talk a little bit about just sort of how you're seeing the first half shape up and wholesale? And I'm just trying to think through. You said about 90 percent of the book is filled domestically. Can you give us a sense of sort of how much sequential price improvement you'll see? It's obviously been a rising price environment. So just trying to understand how much that you might have captured in two Q.

Yeah, thanks, Vincent. Yeah, again, I would say that the first half in terms of our upstream businesses were constructive. And we can start with $$, where, again, with such strong global demand, we can go from market to market. Again, with China, we're seeing very strong consumption, quite low inventory levels. India, it's a flat subsidy, but one that at today's prices would encourage probably 4 million tons of demand in that part of the world. In the U.S., we talked about what we're seeing in the planting season here. Certainly in the second quarter, things are going quite strong domestically. We can talk about what we're seeing in Indonesia and Malaysia, albeit 4,000 ringgit per ton. Palm oil prices come off a bit, but still at a level that encourages strong demand. And we're seeing that. We're probably at about a $360 price in Southeast Asia at the moment for a standard grade product. So, again, in Brazil, of course, where we just talked to you last year, 47 million tons of crop nutrient demand, and we're expecting something similar this year. So we can go on the demand side, market to market, and it certainly gives us that confidence in the 71 to 75 million tons. And again, if you look at what's happening on the supply side of the equation and the market's ability to deliver, we believe those two are meeting, and they're meeting with the result of strengthening prices in just about every market that we serve. You know, we can go over to nitrogen products, where here in the planting season, we've had really strong urea, UAN prices, ammonia sun softening with new supply coming on. We're all watching China as it relates to export volumes. But at the moment and in the planting season, we're seeing quite a bit of strength. So, again, market to market, and we can talk about phosphate prices, particularly strong. Market to market wholesale business, our upstreet business, we're constructive on the first half and frankly into the balance of the year.

Your next question comes from Richard Gartchent-Horena from Wells Fargo. Please go ahead.

Great. Thanks for taking my question. Just wondering on the nitrogen segment, looks like you had higher costs as a headwind in the quarter. I was wondering how much of this was related to Trinidad. You know, was this across all your facilities? Obviously higher natural gas price in North America as well. And then also just maybe on tariffs, I guess, how are you thinking about handling that if there are going to be some tariffs on material coming into the country from other regions such as Trinidad? Thank you.

Yeah, so two questions there, one on costs, one on tariffs. I'll hand it over to Mark to talk about what we're seeing the first quarter, first half for costs and our nitrogen network. And then maybe Chris, just to talk a little bit about this, I guess it's 10 percent flat tariffs on some of the other regions who produce nitrogen.

Thanks, Ken. Yeah, good morning, Rich. On your first question on nitrogen costs, Q1 is a pretty straightforward answer. Obviously, when we came into the year, we had expected to see Henry Hub prices in a range of three dollars and twenty five cents to three dollars and fifty cents to begin the year. And natural gas prices began the year higher than we anticipated and in more volatile fashion than we anticipated. So the majority of the costs that you're referring to in the quarter would have been driven by higher gas prices in North America. So that said, we've seen gas prices ease off somewhat. While there is still volatility in the market, we've widened out our range for the remainder of the year to be three dollars and twenty five cents to four dollars. As we've moved through the winter, we've seen gas prices ease a little bit, albeit still volatile going forward. I would just point out that obviously we continue to benefit from a wider than historical spread with our plants up in Alberta and continue to expect to reap the benefits of that through the remainder of the year. So with that, I'll pass it over to Chris. Yeah, thanks, Bob. Good morning, Rick.

As it relates to tariffs, some of the price increase we've seen, whether it be the URIR or UAN, maybe from the imposition of tariffs from those countries that have the 10 percent imposed on them. But generally the story is much more about demand. And as you heard from Ken and his opening remarks about the impact of planting 95 million acres of corn, a little bit of catch up nitrogen application that was missed in the fall. And that's the real factor that's driving the prices, particularly of those of those two products.

Your next question comes from Ben Ozexson of Scotiabank. Please go ahead.

Thank you very much and good morning. You gave global potash shipment guidance of 71 to 75 million tons, 75 being strong demand, 71 being weak supply. Now, you don't have weak supply. And so my question is, with prices now starting to move to and through mid cycle, you talked about Campotex being sold out in Q2. Your Campotex peer yesterday nudged up their volume a little bit in potash. How should we think about nutrient responding to prices? Is it too early or are prices too low for nutrient to start increasing volume? When should we expect you to to respond to higher prices? Thank you.

Yeah, thank you, Ben. And no, we're prices are not too low. We're encouraged by again by what we're seeing in all of the markets that we serve. But it is early in the year and we are in the middle of the planting season here in North America and we have guidance range that we have put out. We maintain that guidance range. Now, could we find ourselves as the year unfolds in an environment where we're somewhere between the midpoint and the top end of that guidance range? We could. And as you know, we certainly have the ability to do that with our six minds, our flexible network, our ability to search capacity when we need to in an environment that's calling for our time. So we're talking to our customers every day about their needs, their demand. And again, we're constructive on what we see for the balance of the year.

Your next question comes from Chris Parkinson of Wolf Research. Please go ahead.

Great. My question kind of straddles two prior questions, but in the beginning of the year on the potash side, you know, there's this presumption that the market would benefit from Belarusian Russian curtailment perhaps a little bit out of China, you know, the amount of Chile. And then obviously, Laos has been a bit of a debate. But all in all, it looks like supply has actually been quite healthy out of the FSU, especially Belarus versus prior citations. Russia perhaps a little bit less so, but that further indicates that this is a demand driven environment. So if we take that into consideration and whether or not you've come correct as part of this, you know, how should we think about the sustainability of higher prices? Because I think previously people were thinking, hey, you could get a little bump up, but then we're just going to give everything back in the second half. And I think that's looking increasingly less so. So can you just help us compartmentalize your way of thinking and how that plays in your strategy for the balance of the year? Thank you so much.

Yeah, Chris, thank you for the question. Again, I go back to the way demand is materializing this year and the global grower and the affordability of crop nutrition as they try and maximize yields. And that's happening in North America as we speak. Chris mentioned 95 million acres of corn, which is again constructive for crop nutrition going to ground. But we can go market to market and we're seeing really, really record level demand. And that gives us a confidence in that 71 to 75 million tons. We've talked about the constraints on the top end of our guidance range, global shipments as being a supply constraint. And even without the curtailments, perhaps that were announced in places like Russia and Belarus, maintenance downtime, which, you know, we may yet see. Yes, we've had seen some volume reductions out of Chile at the margin and perhaps not all of the incremental tons that were announced coming out of Laos. So there have been some supply disruptions. But what we believe we're seeing is, again, this intersection where global demand is beating the market's ability to supply and ship. And as a result, we have seen, again, strengthening in prices in every spot market that we serve. You know, China and India contracts obviously haven't been settled so that we look over the balance of the year and how we're thinking about the remainder of 2025. And again, that's where we say we're quite constructive.

Your next question comes from Steve Byrne from Bank of America. Please go ahead.

Yes, thank you. I have a couple of retail questions. First, the two bolt-ons. What do you think EBITDA contribution could be? Post synergies? Another one being your proprietary brands with Loveland and Dyna-Gro. Are you gaining share in those brands, would you say? Versus other brands out there. And then lastly, any update on the launch of that Infinity product?

Absolutely, Steve. Thank you for the questions. I'll hand it over to Mark to talk about your first question as it relates to the acquisitions. And then over to Jeff to talk about Dyna-Gro and our LBI brands. And certainly we can talk about what's happening with Infinity.

Yeah, thanks Ken. Good morning, Steve. So Steve, maybe just to take a step back. You know, we've continued to say that over the past couple of years, you know, we've been cautious in the deployment of capital and ensuring that where we're putting capital to use is the highest return opportunities to continue to grow free cash flow per share. And we had expected that as we entered 2025, we would begin to see U.S. retail tuck-in acquisitions come back into focus given the moderation in earnings profile and multiples. And so we made good on that by beginning some of that activity again, and we continue to be thoughtful and prudent in how we do that. These two acquisitions were relatively modest in size. We deployed just over 10 million in capital on these two acquisitions. But as always, when we complete these, they're located in a very strategic area of the U.S. The larger of the two was a distributor called Welch. And it's a very nice fit with our network of business we know very well. And we continue to see a profile that's traditional for us. We see the ability to take, you know, a turn or two of synergies from proprietary products, expense management, and just bringing our procurement advantages to bear. So as we said earlier in the call, as we move through the year, that incremental dollar is really going to be allocated among tuck-in acquisitions to the extent that's the prudent place to deploy capital and share repurchases. And we'll continue to evaluate those opportunities. So I'll pass it over to Jeff on your other questions.

Yeah, good morning, Steve. And I've got a couple of questions you asked around proprietary and started off a little bit as it relates. As you know, we got off to a delayed start in the first quarter this year. And I'll remind you, if we don't remember, last year was a phenomenal start from a weather standpoint in the first quarter compared to a, we didn't get to weather the last two weeks of March in the campaign we're in right now. But from a seed standpoint, our revenue and our margins up in the first quarter. And Steve, that's predominantly because the shift we've seen from soybeans to corn, particularly in the South, we're up about 25 percent on acreage, corn acreage in the South. And now across the whole U.S., that's not a material number, but it's certainly going to contribute to that five million acre growth we're projecting for the year. We do very well with our corn varieties with dine and grow. And so this has given us a good opportunity to expand that as well. We continue to be really excited about our about our proprietary business as a whole. We've got a we forecasted about an eight percent increase, eight to nine percent increase in gross margins this year across that portfolio of products. And we think with the increased corn acres and our attention to our foliar nutritionals and bio-stimulant products, we think we're going to have a really good campaign this year. I might also add that we've added 12 new products for this year. And we plan to introduce as many as 20 new products going into 2026 from that standpoint. Now, you asked about Infinity specifically. We're having a nice launch to that product. We're right in the right in the throes of getting it put to ground right now. And I'm just as anxious as you are to see what our results are going to look like as we get our nitrogen applications put down. As you know, this nitrogen enhancement too. So, yeah, we feel we're excited about our opportunities in our proprietary products portfolio. We're expecting a lot of growth out of that segment over the next two years.

Your next question comes from Edline Rodriguez of Mizuho. Please go ahead.

Thank you. Good morning, everyone. Ken and also Mark, this is a question I've asked before. And it's always intriguing to get your insight there and also put you on the hot seat. Part-ash or far-sit? When you look at the fundamentals over the next six months or the next 12 months, which one you think is a better position? And please, you can't say you like both of your children the same. You have to choose one of them.

We like both. But no, Edline, thank you for the question. And, you know, obviously we've seen quite strong phosphate fundamentals and that's strong demand and limited supply. And we expect that that will continue over the course of this year. So, you know, we've seen historically high phosphate prices. And again, we don't see any reason why we would see softening over the course of 2025. Yeah, potash is a story of, you know, the fundamentals coming together at the start of the year that makes us constructive on perhaps firming throughout the balance of 2025. I mean, we've seen 20 percent increases in potash prices since the start of the year. Again, we've increased our own domestic price three times. And so as suppliers are and certainly buyers in China and India are starting to think about and formulating price ideas. Again, we're constructive. So it's just to say that phosphate, we think will stay strong and potash is becoming stronger.

Your next question comes from Hamir Patel from CIBC Capital Markets. Please go ahead.

Hi, good morning. Could you speak to the M&A pipeline for retail in terms of the scale of opportunities you're seeing, vendor at price expectations? And just given your latest tuck-ins, do you think you can hit the two billion objective for 2026 with the existing platform?

Yeah, no, thanks, Samir. Yeah, you know, certainly as we think about our 2026 target, we believe we're on track there. And we don't think about these couple acquisitions that we did at the start of this year as a necessity to get within that range. We think more about growth, proprietary products, about cost savings initiatives, many of which we have already achieved. And we've talked about that in a year ahead in our $200 billion SGA savings. We think about network optimization and we think about, yes, the potential for tuck-ins. And certainly it gives us confidence in getting into the bottom end of our $1.9 to $2.1 billion EBITDA range by 2026 for our downstream business. You know, with some cooperation from weather and commodity prices, certainly you can find yourself well within that range. But maybe I'll hand it over to Jeff to talk about the opportunities that we're seeing in the pipeline. And maybe Mark can talk a little bit about how we're thinking about price expectations.

Yeah, we're in that period of the year where we'd be slow on the tuck-in side of things. We're starting into their spring planting season in North America. And so, but I do expect to see the opportunities increase as we get through the season, especially as we get to the back half of the year. You know, we want to be very opportunistic when it comes to tuck-ins. You know, in my mind, I've kind of got sweet spot of what good tuck-ins look like for us. We'd particularly like to grow in the corn belt if we could find the right opportunities there. I might also mention that we're seeing the pipeline pick up a bit in Australia as well. We've had a good history of doing tuck-ins in that market. But I think you asked a question around valuation as well. We're going to be very disciplined when it comes to the valuation of these tuck-ins. And in my opinion, I think we've seen the value come down some over the last 18 months. And so, we'll be very disciplined and prudent as we look at these opportunities, just as the two we just closed just prior to the spring season. Yeah.

Thanks, Jeff. Ken, I don't have a lot to add. I think we're just, you know, to your question specifically on valuation, I'd say to Jeff's point, we've seen valuations come back in line with where we're comfortable historically. As an example, we continue to see high quality acquisitions in that small to medium sized range at sort of a six to seven times EBITDA on a pre-synergy basis. And as I mentioned in a prior response, we continue to see the levers to be able to take one to two turns of EBITDA out of those acquisitions with the synergy opportunities that we have. And to Jeff's point, we continue to be quite selective and there's no predetermined or necessary amount of capital that needs to be deployed to tuck-in acquisitions, as Ken said. It's really where is that dollar most prudent? It's going to generate shareholder returns and maximize pre-cash flow per share growth. So, we'll continue to evaluate these as we move through the second half of the year, opposite the other activities and opportunities we have for capital.

Your next question comes from Duffy Fisher from Goldman Sachs. Please go ahead.

Yeah, good morning guys. Question around crop protection and retail. So, we've had a number of the producers already come out with their earnings and, you know, it seems like pricing has been weaker kind of across the board. So, within your business, how difficult is pricing been? Is that part of the down bar chart there from slide six? Is that something structural, do you think, or is that just a hangover from the oversupply that we had the last couple of years? And then just the third part of that would be a number of the generics that come into the US start in China. Are you seeing the tariffs have an impact on those generics where maybe that would be beneficial to you that the importers there are going to have to pay a high tariff and maybe price them out of the market?

Yeah, I'm not sure. Go ahead, Jeff, please. Yeah, no, I think I wrote down both parts of your question there. If I look at crop protection for the first quarter, obviously revenue was off 100% dictated by the weather both in North America and Australia as well with some dryness there. And if I look at it from a margin perspective in the first quarter, we were off some on margin, but we had planned to be off on margin. We anticipated that we would see more pressure in this crop protection market. And I think that's twofold. Some of it is, you know, a hangover from inventory that was in the channel. Probably the bigger part of it is, as you just mentioned a minute ago, is generic pressure. We did see more generics come into this market, especially in North America. I mentioned Brazil earlier, but we had started to see that, you know, 12 to 18 months ago. I do think that, you know, and look, I have no answer on the tariffs and how long they might be around. But we're going to start to see pricing move up on the generics. And we're already starting to see that from the generic suppliers today. And at the same time, that will affect the multinationals as well from that standpoint. And so that could slow some of the flow of generics, particularly into this North American market. But, you know, growers have been a bit more selective this year, been a little bit more pricey on products as they go in. But that's to be expected. And we plan for that going into the year. We have a, to me, we have a great offset to that. And that's our proprietary products that we offer in that generic space. We were in a very good position coming into this year in that we had already secured our inventory and had it over. So we're not tariff affected on the majority of that volume. And we've got a very good offering in those markets where they want to go a bit more to the generic side of it. I don't know if you had anything.

Thank you, Jeff. Just to say that we have assumed a 4% reduction in margins for crop protection this year. So we talked about our guidance range of 1.6 to 1.85. There are some assumptions about everything you just described, Jeff.

Your next question comes from Jeff Zikoskas of JP Morgan. Please go ahead.

Thanks very much. In crop protection, your proprietary products in the quarter were down about 30%. And your gross profits were down about 35. But for your non-proprietary crop protection, maybe things were down about 10%. Why the difference? Secondly, what's the state of the Indian and Chinese Padaj negotiations? And third, in your nitrogen business, can you talk about how much nitrogen gets exported, nitrogen in retail? Can you talk about how much goes into the United States and whether that's being penalized in any way by tariffs? Thank

you. Great. Thanks, Jeff. So I'll hand it over to Jeff Tersey to talk about proprietary and particularly crop protection proprietary products. And over to Chris to talk about China and India and then nitrogen products. And then to Mark to talk a little bit about tariffs. So over to you, Chet.

Yeah. On the crop protection side of it is it relates to proprietary versus non-proprietary and margin. And that's strictly a timing and mix predicament we're in right now. As Ken mentioned earlier, we've seen a very robust start to April and May in our marketplace. And that includes the crop protection market as well. In the first quarter, because of the weather delays that we saw, our custom application was down substantially. And any products, whether we move them through, whether they're a branded product or non-branded product, when we're able to put them through our own rigs, we have different market structure for those products as well. And it's also affected by some of the high margin LBI products, adjuncts and surfactants and such. So when you've got to reduce reduction in volume, it kind of offsets that whole margin structure as it relates to that. We would expect to see that level itself out as we go into the second quarter. And we'd see an evidence of that now. I'll pass the question over to Chris for the second quarter.

Yeah, thanks, Jeff. And good morning, Jeff. Thanks for the question. Regarding China and India, Cap-Tex have started that engagement on those two contracts. But really being done against the backdrop that you've heard during the call of some very, very strong market fundamentals, but perhaps more encouragingly, no fundamental buildup of inventories anywhere in the world. And so as Ken alluded to, there's some Southeast Asia pricing right now that folks are looking to as an indicator. And so we're encouraged by all of those market fundamentals. But really, as you go around the world, whether it's North America, what we're seeing in Brazil, Southeast Asia, all steady and sustainable price increases on the back of that good demand, some concerns about the production side, and some very constructive commodity prices. With that, I'll hand it over to you.

Yeah, thanks, Chris. Good morning, Jeff. So just on your third question, I think the short answer is on a direct basis. No, our retail business is not being directly impacted by tariffs on nitrogen products coming into North America. Obviously, as you know, one of the benefits of our downstream retail business is the supply chain, the procurement capabilities that we've set up. And so whether that's the integration and the synergies we're able to drive with our upstream business in terms of domestic nitrogen supply or the ability to source and procure nitrogen from other domestic producers, we're very well positioned for the spring season today and not seeing direct impact from tariffs. More generally, as both Ken and Chris have spoken to on McCall, we are seeing North America in a position where it's come into the spring on a net short basis for products like UAN and URIA. And we can see the supply demand squeeze having an impact on prices. So to the extent that that continues, we're going to see strength in the market, but we're continuing to operate. We're very well positioned for the spring.

Your next question comes from Steve Hansen of Raymond James. Please go ahead.

Yeah, good morning, guys. Thanks for the time. You deserve some credit, I think, for hitting the synergy targets early and some successful signatures thus far. Is it too early to put another target on the map for us to think about in terms of cost energies? And just secondarily, what else do you view as sort of a priority to review in terms of being non-core? Thanks.

Yeah, thank you, Steve. Yeah, with respect to what we've achieved to date, we talked about our $200 million target and being sort of a year ahead on that target. And to your point, actually, confidence is really closer. There's confidence to do better than that confidence to do more. In terms of talking about specific numbers, we'll have more to talk about. But at this stage, we're assessing that. We're going after some of that. But like I say, we do have confidence in our ability to do more. And we're encouraged by, certainly encouraged by progress today. With respect to the review of non-core assets, yeah, that's something that we're looking very closely at the moment. We've talked about how we're reviewing our Latin American South retail assets and looking for the market to cooperate with us a bit as we think about divestiture, albeit non-material for us. We talked about the process that we're in as it relates to pro-fructile. And just going through that process at the moment, we've talked about divestiture of our CIDAFER chairs, which was a passive equity state that is really not strategic for us in the $223 million proceeds that we realized Q4 last year and the start of this year. And yes, there are some other things that we're looking at at the moment that would meet that definition of non-core. We're looking at that at the moment. And yeah, we'll have more to talk about as it relates to, again, looking at additional divestiture opportunities.

Your next question comes from Ben Thurer of Barclays. Please go ahead.

Yeah, thank you very much for taking my question. I want to go back real quick. And you had some of that in the remarks, but on phosphate volume, clearly you had some unplanned outages that impacted your volumes. But at the same time, we've seen a very strong price overall in phosphate. I was just wondering as it relates to achieving your guidance after that softer start in volume in 1Q, how confident are you that there is going to be enough demand on the phosphate side, just given the prices are? Are you seeing any signs of potential demand destruction because of these prices? And how should we think about the potential outcome low end versus high end of the guidance for the volume side in phosphate? Thank you.

Yeah, thanks, Ben, for the question. And you know, no challenge, we don't think, on the demand side of the equation that we still see strong demand. And frankly, that's what's translating to the strong price environment. As it relates to our own production, yes, we had some production challenges in the first half of the year here, weather related and some other production challenges as well. We're taking turnarounds at both our White Springs and Aurora sites here in May-June and expecting greater reliability rates as a result in the second half. So it really is a bit of a story of two halves for our phosphate business. But when you put those two halves together, it does give us confidence that we'll be within that guidance range and hence having maintained our guidance range.

Your next question comes from Lucas Beaumont of UBS. Please go ahead.

Hi, good morning. Yeah, I just wanted to go back to the crop chem kind of tariff exposure in retail. So I was just wondering, could you size for us out of the four and a half to five billion you have there in cost of sales on the crop chem piece? How would you size, I guess, the exposure to tariffs going forward, be it for me to purchase the finished goods, intermediate products, assuming that the tariffs remain in place? I mean, I understand that this year you've got inventory, so it's probably not going to impact 25. But I mean, assuming you have to go through another cycle, I guess, how would you size the impact? And then just lastly, does nutrient import finished formulations? And how large is that for you if you're doing that? Thanks.

Well, thank you, Lucas, for the question. And yeah, you're right that we have purchased to cover ourselves, you know, for the most part for this year. But yeah, it's also the case that we're watching the trade dispute between China and the US quite closely because crop protection is obviously a big part of that story. Now, a number of those products have been accepted when we look at the exemption list. And so, you know, for those that are accepted, obviously we're encouraged by that. But there aren't our products that haven't been. So maybe I'll hand it over to Jeff to talk a bit more about that.

Yeah, so especially if we're talking in a range of our proprietary products, as you would know, in the proprietary CP side of that, 98% of those products would be outside patent life. So they're generic products. You know, we do multi-source those products. In many instances, we source those active ingredients from our multinationals. And we also source directly out of China and India as well from that standpoint. And I think you asked the question, you know, do we do we source finished goods versus active ingredients? And yes, we do both on that end of it. So obviously we're spending a lot of time right now as we focus. We'll start back this fall, obviously, on building our inventories back up for the 26 year. And we'll focus very heavily on, you know, what puts us, what puts our growers in the best position going forward on that. You know, we're expecting we're expecting price increases on branded products anywhere from five to seven and a half percent. And I think on the generic side of the business, I think you could you could probably start with that higher number and move up. And I can mention that there there are a lot of ingredients that are exempted that exempted still will come with with the base 10 percent. And it's a complicated matter because these products are made up sometimes with 10 to 15 different components. And not all of those components are coming out of one of these particular areas. So we're spending a lot of time right now. We'll spend a lot of time the next 60 days from a diligent standpoint. We're going to soon, you know, right now, we'll assume we got tariffs if we work through start position and ourself going forward on that. But I think the long story short is we're going to see price increases. We don't I think it's not been mentioned earlier. We don't see this being material to our earnings for the 25 year. And where we're experiencing some of these pricing increases, you know, our plans to pass those pricing increases through to our customer.

Your next question comes from David Simons of PNP. Please go ahead.

Oh, yeah, just just one more follow up on the phosphates business, please. Talked about sulfur costs hampering the earnings in that business. But if I look at headline prices, I would have thought that would have been passed through. So is there is there some kind of timing issue that held back your strip margins in Q1 and meant that sulfur costs were a factor? And how would that evolve into Q2?

Thank you. Thank you for the question, David. Yeah, I would say that the phosphate price at the moment is more a story about supply and demand fundamentals and what's happening on both sides of that equation. As opposed to the ability to pass through cost increases and, you know, sulfur is part of the story. But like others, we're experiencing inflationary pressures on other things as well. So the idea of a pass through versus just the supply and demand fundamentals that we're seeing is certainly a story of the latter. But maybe handed over to Jason Newton, our chief economist, just to talk a little bit about what we're seeing in the sulfur market. And yes, some of the impact that we've experienced there.

Good morning, David. Yeah, as Ken mentioned, we're seeing sulfur market fundamentals tightening. We've seen those tighten in the first half of the year and campus sulfur prices in the second quarter were $270 a ton. So a pretty significant increase quarter over quarter and definitely an increase from where we saw our sulfur prices in 2024, which were historically discounted relative to phosphate prices. Actually low from a margin of cost or cost perspective for producers, which meant that they were pouring product to block or putting product in inventory rather than exporting. So that tighten the supply and coming into 2025, we've seen strong demand from China, strong demand from a base metal perspective in Southeast Asia. And so the combination of reduced export supply and higher demand is supporting prices. We expect that that will start to change as we look toward the second half of the year and offer prices have remained pretty stable, but supplies are increasing and the level of demand is decreasing. So we expect more normal relationship with phosphate pricing as we move into the second half.

I will now turn the call back to Jeff Holzman for closing remarks.

Thank you for joining us today. The investor relations team is available if you have follow up questions. Have a great day.

Thank you, ladies and gentlemen. This concludes today's conference call. Thank you for your participation and you may now disconnect.