E A Sell-Off Day

Credit Suisse's C. Parkinson raised some question: 1) an update on capital allocation after required equity stakes are sold; 2) whether farming inputs in the USA given agriculture trade policies; 3) how is synergy working out: 4) future phosphate outlook; 5) what about Asian contract delays; and 6) what about freight issues in Brazil? I am sticking with BCD for its 5.5% dividend and habit of raising the rate every year.

*Barclays reported a profit this Q2 vs a loss last year. The may affect our ability to continue to book a nifty divvie from its non-cumulative preferred, which can be called.

*Germany's E.On reported that it had added 50,000 retail clients there in Q2 and the stock bounced nicely so we are, Endlich (finally) in the black on the German ute stock EONGY.


*Mazor Robotics sank an unbelievable 18% after reporting adjusted losses for its Q2 after losing 11% pre-market. Revenues fell to $13.2 mn from prior year's $15.5 mn, nowhere near the Capital IQ consensus forecast of $17 mn. Net loss was 3 cents vs a 5 cent loss in Q2 last year but restated to $3.9 mn, up $100,000 from last year, or 7 cents/sh vs 8 cents.

The Israeli maker of surgery assist software blamed the lower prices imposed by its US distribution partner Medtronics but which helped its robotic sales rise 25% in Q2 and 32% in H1. The Medtronic arrangement was subsequent to Q2 2017. It is now being spread worldwide after starting with the US.

Other Q2 metrics also were down, gross margins to 56.1% from prior year 69.4%. However, operating expenses at $11.3 mn vs $14.6 mn a year ago reflected lower marketing costs. H1 operating losses fell to $5.3 mn from $9.6 mn in H1 2017. This is how a transition looks and the selloff is excessive. At $51.60 and pennies I would be buying more had I not already quadrupled my money.

*Canadian Nutrien reported earnings of $741 mn ($1.17/sh) and adjusted earnings of $1.48/sh, the adjustments relating to costs related to its formation via the merger of Potash with our former Agrium, share buy-backs, and compensation because of the merger, and other one-offs. It reports under IFRS but in US$s. Its costs are mostly in loonies so it gained on forex changes too. EPS even adjusted beat consensus estimates by 8 cents.

EBITDA at $1.5 bn in H1 up 10% was boosted by the retail clout AGU gave the combo with its distribution network. The biggest factor, however, was the sale of Sociedad Quimica y Minera de Chile, SQM, and Arab Potash of Jordan, which will provide $5 bn of funds in the course of this year but were required by competition rules. There will be more non-comparables because of the buy of Waypoint Analytical and Agrible during Q2 and more investments to come. In addition, the creation of NTR is said to have generated $246 mn in run rate synergies so far and by the end of the year will hit $350 mn.

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