Good day, and welcome to the CF Industries Q3 2025 Earnings Conference Call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then 1 on your touchtone phone. To withdraw your question, please press star, then 2. Please note this event is being recorded. I would now like to turn the conference over to Martin Jarosik, Vice President of Treasury and Investor Relations. Please go ahead.

Good morning, and thanks for joining the CF Industries Earnings Conference Call. With me today are Tony Will, President and CEO, Chris Bone, Executive Vice President and Chief Operating Officer. He's reported his results for the first time. We'll review the results. The statements made on this call and historical facts are not guaranteed of future uncertainties and assumptions that are in any statements more detailed information about factors that may affect our performance may be found in our filings with the sec which are available on our website also you'll find reconciliations between gap and non-gap measures in the press release before we begin today's call i want to provide an update on the incident we experienced at our yazoo city mississippi and contractors are safe and no significant

inner afternoon we posted which we generated adjusted ebitda of two these results reflect outstanding execution by the CF industry, and most importantly, decarbonizing our production real value to our SHG emissions intensive percent from a single one of the initiatives that contributed to this remarkable achievement have been highly NPV positive. We are the best that can actually go hand in hand with executed all of the following initiatives. We closed two of our least efficient, highest emissions plant, lower emissions, exceeding 20% Louisiana ammonia plant, and increased 150. We installed N2 urban credits from which are being sold at high value within just a single year. And finally, we have 2 million metric tons generating carbon ammonia at a differentiated and now command. Initiatives have helped reduce our emissions intensity by roughly 25% from our base of Yazoo City, Mississippi. Numerous other initiatives yet to be announced. The end result is that we have a robust through the end of the decade that will continue to dramatically reduce our GHG emissions intensity. Take a moment and highlight what I consider to be a great slides-numbered cash flow generation and our relentless share repurchase program. 2012 shows a remarkable free cash flow conversion efficiency from EBITDA, and yet amazingly, how low valuation. And yet we are very different challenges of products or of distribution channels being sold for those selling. Even in periods of relatively weak growth, nitrogen demand is unaffected due to subduing supply production disruptions disruptions in other parts of the region where nitrogen demand and resulting pricing was very about in a few minutes we see the same strong demand dynamic nitrogen and certainly cf industry's financial performance is not impacted do not suffer from sluggish cash flow generation is and yet is shown on page 12 we have traded an anemic average should be the low end of an ebit doctor trades at 27 the material sector trades at 30 times cash flow generation on saying the market doesn't really understand. As Greg will talk about shortly, we have made great purchases and continue to do around this table. I believe CF represents an amazing value. Average 7.5. Continue aggressively repurchasing shares and those that don't provide more details in our

industry's manufacturing network. It's a 97% ammonia utilization rate for the first nine months of 20. We continue to expect tons of gross ammonia for the full and strategic initiatives that are now generating ebit fully utilized expanded diesel exhaust fluid rail loadout capability. This enabled us to capture incremental high margin DEF sales and led to a monthly record for DEF shipments from the site. Compression unit which was commissioned in July continues to run well. We are generating 45Q tax credit. A nitric acid project is expected to reduce carbon dioxide equivalent emissions at the site, housing metric tons, turns generated by our CCS project will add a consistent $100 million to our free cash and excited about blue point project offers us particularly given the sales and ammonia from Donaldsonville detailed engineering activities acted to be within the range we projected earlier this year to begin in 2026 nitrogen market and the growing

interest and low carbon ammonia optimizing yield which should support healthy nitrogen application order adjustment mechanism or structure confident about it will be affected by ammonia at a premium to conventional ammonia today and will drive significant already high-performing nitrogen business. We look forward to working with customers to build...

The first nine months of 2025, the company reported net earnings attributable to common stockholders of approximately $1.1 billion or $6.39 per diluted share. EBITDA and adjusted EBITDA were both approximately $2.1 billion. The year 2025 5 reported net earnings attributable to common stockholders of 353 million dollars or two dollars and 19 cents per day EBITDA and adjusted EBITDA were both approximately 670 million dollars trailing 12-month basis net cash from operations was 2.6 billion dollars and free cash flow was 1.7 continue to be efficient converters of EBITDA to free cash flow our free cash flow to adjusted EBITDA conversion rate for this time period was 65 percent as you saw in the press release we updated our projection for capital expenditures on our existing network to approximately $575 million for 2025. Collects additional maintenance, we were able to complete a fish timing of strategic investments that Chris mentioned this morning, and he spoke about it our investor day in June. We returned $445 million to shareholders in the approximately $1.3 billion for the first nine months. We completed our 2022 share repurchase authorization, having repurchased 37.6 million shares, which represents 19% of the outstanding shares at the start. It continues to create strong value for long-term shareholders. Net earnings increased approximately 18% compared to the first nine months of 2024, while earnings per share were approximately 31% higher, reflecting our significantly lower share count. The same positive impact can be seen in our shareholders participation in our production capacity and the free cash flow it generates. We are now executing the two billion dollar share repurchase program authorized in 2025 with over 1.8 billion dollars of cash in your

returning substantial capital to our shareholders. 48, 12 years, eternally grateful to the site and guidance through the CF possibly hope for their business acumen, but I also thoroughly enjoy their company capacity expansion projects, our strategic repositioning of the company acquisition, and most recently our heading FP&A to new heights. Contributions to CF over his 18-year tenure. Tony's influence where he

generated and championed the do-it-right phrase is a core statement whose relentless pursuit can be best described as bias towards action. This has been exemplified through the growth the company has experienced under his guidance. Through the CHS transaction acquisition to the recent announcement of the Bluepoint joint venture, increasing CF ammonia production and free cash flow generating assets. I'm a CEO. Since he started at safety first mentality, keen decision making is what is position CF where we asset utilization. Thank you, Tony.

We will now begin the question and answer session. To ask a question, you may press star then one on your touchtone phone. If you are using a speaker phone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then 2. First question comes from Ben Thurher from Barclays. Please go ahead.

Good morning, and thanks for taking my question. So first of all, Tony, all the best in retirement. I'm pretty sure you have plenty of things you want to do, So enjoy that. And that's it was quite a run, I guess. So that's that's that's never bad. So enjoy that piece. And maybe as well for you, Chris, all the best on your on your new assignment as CEO. So two quick questions I have. So one you've you've talked about in your presentation material about like how like the mid cycle where you are right now and the mid cycle where you think you're going to be. in three, four years' time as you get these additional projects come through. So I just want to understand, the current market conditions obviously still seem to a degree stretched, with the European gas price somewhat elevated versus what maybe mid-cycle in the past was. So I wanted to get your view in terms of the bull versus the bear around that $2.5 billion mid-cycle mark and how we should think about that evolving from a feed cost standpoint of view into the period of 2030. And then I have a very quick follow-up on pricing premiums.

So I'll start. So $1 billion, we had a $3.50 gas strip in there for Henry Hub and a realized price on urea at $3.85. As of today and through the year, we've obviously traded below that on the Henry Hub, so from a feedstock we've been benefiting in our results, and then lately you've definitely seen a price move on the urea. Hopefully you're seeing that and appreciating that in the results that we've printed at two points. I think as you think about it going forward in the spread between what we see here in the U.S. and in Europe, our view is that there will be some tightening there. We expect to have a competitive advantage and remain lower-priced on a nominal basis as well, relative basis. We continue to be a tailwind to us for our...

I was saying, Ben, that conditions are well above kind of what you said.

The $3 billion motion being executed on today, what we know today, and that will likely grow as time goes on as well.

Okay, got it. And then that price premium on the ammonia you're selling in Europe, the blue ammonia that you're getting out of Donaldson, And, Will, can you give us a little sense of magnitude as to the premium that you're getting here with your customers?

This is Bert.

And we've been with Evita that was never, you know, initially part of the justification of that project. And so it's kind of nothing but goodness across.

Fantastic. I'll pass it on.

The next question comes from Ed Lane Rodriguez from Mizuho. Please go ahead.

Thank you, and good morning, everyone. Again, Bert, I mean, Tony, clearly you will be missed. That's clearly the case. And good luck with everything. So quick question, again, maybe for you, Tony, maybe for Bert. In terms of, I mean, as you noted, the nitrogen outlook looks very constructive. But if you were digging for possible boogeymen, you know, in terms of, you know, trying to find something to worry about in the near or medium terms, like where would you look?

Sir, I was going to say all you have to do is read somebody.

So one quick follow-up for you, and this is for Tony and Chris. I mean, Tony, you've talked about the valuation disconnect in your shares. Clearly, I guess you failed to convince those jaded investors. Like, what else do you think, Chris, and Chris, you know, you could answer that, too. What else do you think you will need to do to convince investors of that, you know, valuation gap that you clearly see?

I mean, we did a European roadshow that there's a lot of.

And the only thing I would add to that is, you know, when you ask what should we do, is, you know, it's to continue to do what we are doing, conversion to free cash flow that I think we, as a company, reflect on more than any chemical in the ag or in industries. And so at some point, that's...

Okay, thank you.

The next question comes from Joel Jackson from BMO Capital Markets. Please go ahead.

Hi, good morning. Tony, congrats again. A couple of questions. If you brought forward $75 million of maintenance CapEx this year, Does that mean that next year you should be generating 425 CapEx on your non-BluePoint network?

Yeah, Jill, I'll start with that and then if anybody needs to add something to it. But that increase, we start the year running at about a 550 is kind of the range we're performing in. Three things. One, we completed more projects than we typically do at this time. There's a lot more projects that are easier to finish during this particular time frame. And then we also, part of it was a timing of a nitric acid, you know, precious metal purchase, which was quite a bit that we do from time to time. And then we had, you know, to be honest, some of the inflation by a few percentage points in what we had been forecasting. So as I look at 2026, I would still use the 550 as our range going forward.

Okay, and I know it's early, very early, and it's great that there's any injuries, But do you know if what's happening in Yazoo City, is this going to be an outage that order of magnitude days, weeks, or months?

It's way too early to the ammonia plant that you run into. The next question comes from Chris Parkinson from Wolf Research.

Please go ahead.

Tony, I'm not one to always say, like, say great quarter, but I'll give you a shout out and I'll say great 12 years. And through all the debates, agreements, and at times disagreements, you've always challenged me. So I'd like to personally thank you for that. It's been a pleasure. The question to both you and Bert, you know, there's been, and it shows you how it's like the market can be, there's been a lot of inconsistency of supply throughout the entirety of this year. And you have things in Russia, Germany, Poland, Romania. I mean, perhaps this becomes a broader intermediate to longer term question, but how much of the demand and the price strength do you attribute to the supply side of it versus the fact that demand, I think broadly speaking throughout the year to date, has also been pretty healthy and kind of led to these price rallies at times at non-seasonal times. So I'd really appreciate your perspectives and kind of how to think about 26 in the context of what we've actually been seeing experience, what we've been experiencing in 2025.

I think the demand piece of the equation is much easier to forecast. The UAN fill-proof ammonia that's going on right now, we're anticipating the demand side of the equation to be very, supply side's a little harder to kind of peel back. Much of it is the D. I would say there's no doubt that.

And just as a quick follow-up, I mean, Tony, you've gone through your fair share of, you know, capacity expansions, both, you know, I should actually say very large brownfields and other brownfields and everything with your network. What have you, Bert and Chris, learned the most from all those efforts over the last, you know, 12 or so years that Chris and his team can essentially apply to Bluepoint to perhaps mitigate a lot of the things? Is there kind of a track record of lessons that you can really apply here, or is it just going to be every project's different at the end of the day?

Yeah, I would say we learned a ton. We did a full body and detailed engineering to FID, and so we have a much better person. And the size of our network and the expertise we have across brings tremendous other people that are years late the capability and expertise running ammonia. The people involved in the project were also involved. We're going with modular construction.

Last time, you know, on a stick build time and material, you started to see labor costs get out of control. So I think that was something that we did. And lastly, something that we'll do that we did last time that the whole team's working on, which is we begin hiring operators and engineers today. And what that allowed us last time was to get to over-nameplate production within, you know, a couple of which nobody else was. Leveraging our overall network, not just for engineering expertise, but to train. Thank you for the color as always.

The next question comes from Andrew Wong from RBC Capital Markets. Please go ahead.

Hey, good morning. And just echoing everybody else's comments, Tony, congratulations on a very successful career and guiding CS for a lot of market ups and downs. We've seen a lot. So enjoy your next chapter. Thank you, Andrew. Yeah, I think. And so just maybe on the comments you made earlier around the valuation, I think you made some very fair points. So maybe a question for you and also for Chris. You know, just given the value in shares and buybacks seem to be the path to kind of realize that value, you have a very strong balance sheet. Would there be any consideration for using debt to fund Bluepoint and maybe using the cash flows and cash generation to buy back shares?

Would that make more sense right now in this business?

Well, the numbers that Greg presented and where we're seeing this year, where we're seeing next year, and even the mid-cycle, we're going to have enough cash to do both at a significant level, just as we've done over the years. We've been able to grow to significant share. We need to do both commodity business. As we're seeing more of our business here go to ratable, more industrial, with premiums and things, we can make different decisions from there. But I think the conversion rate that we do allows us to do whatever we want to do, really.

A billion dollars of cash, a million dollars in cash.

Understood. And then maybe just one on costs. I think SG&A looked still just a little bit elevated for the quarter, obviously not hugely, but just curious if there's anything there. And then also on just some of the non-gas costs, I suspect that the turnarounds this quarter contributed to some of that. Just I wonder if there's anything to flag or anything.

Yeah, it's Greg. On the SG&A side, we continue to just update our, on the non-gas side of one that stuck out was really around our purchase tons, which obviously come into the system at a higher value than what we can produce them at, but it also contributed to gross margin dollars in the ammonia segment being up 30.

Other than that, and the timing of some turnarounds, there was-

Thank you very much.

Next question comes from Kristen Owen from Oppenheimer. Please go ahead.

Hi, good morning. Thank you for the question. I do want to start with a more strategic long view here, just given some of the prepared remarks about the valuation disconnect. And given your comments on whether it's CBAM, where those blue point ammonia tons will go, even some of your comments on death, help us understand if we're looking at this business model in that 2030 framework, you know, how much exposure really is ag anymore versus some of these more industrial applications? And how should we think about that mix contributing to that sort of mid-cycle

framework? Yeah, I mean, ag is still going to represent the lion's share for the foreseeable future. We sell our, we could move all of our, and so some of, even though it is at a lot... I appreciate that. Perhaps a little clarification on my side.

I'm not suggesting that there's some major move out of the ag markets. It's more just how much more meaningful can the earnings potential be on the industrial side, given the uplift of some of these markets. So perhaps a slight clarification there. And while I'm here, I'll just ask my follow-up question. Just given the cost curve in China, a little bit more affordable to keep those – a little bit more domestic affordability. So just any thoughts on China exports in 2026?

Starting China, and that $3 to $5 million could be another. Thank you.

The next question comes from Lucas Beaumont from UBS. Please go ahead.

Thanks. Good luck with your retirement, Tony. Congrats on your career, Matt. Thank you. I'll make all the sentiment with the others. Yeah, I just wanted to kind of ask about Bluepoint. Bluepoint, you see you guys noted that you'd procured all the long lead time equipment now. So kind of just where did the costs come in there compared to the budget? Kind of what percent of the project spend was that? And kind of just remind us of any cost escalation components that are built in there for like inflation and tariffs, et cetera, between now and when the delivery occurs.

Yeah, thanks. This is Chris. Well, for starters, I would say, you know, the projects wonder significantly. is like you're boiling with a significant dollar. As we look at, I think your question probably with tariffs, it's likely going to be coming in, and I'm certain more will change between now and then. But what I would say is we fork contingency. Additionally, there potentially could be upside dependent on what to support tariffs and other areas, strong lead items, some of the engineered complex items.

All right, thanks. And then I guess just on the pricing outlook, I mean, you guys have kind of felt your length of that. I mean, ammonia has been very tight. You know, the pricing is strong. UAN and ammonia imports are sort of running below trends and heading into the fall and spring. So, I mean, the near-term setup looks quite attractive. I mean, same time, the TTF futures has sort of been coming off the past couple of months. It's sort of gone from 12 and looking slightest year on year or sort of, you know, low-tenths kind of now down about $1.50. So, I guess, just how do you kind of see those two factors resolving each together as we go through 26 or I guess if you don't think they'll resolve then

why not thanks maybe I'll start with the with the gas side with the TGFT I mean TGF has come off about a dollar so you're still sitting near $11 on the forward strip with that with the US sitting anywhere from 350 to four so you still have that differential that is very constructive as Greg said longer term you know when we get into 28 29 we may see that contract some but not nearly to the level just given that the projects being built have to have return profiles with those as well and the additional demand that will be drawing on LNG point we still think the gas differential is going to be very strong even if it comes in a dollar or two from where it is question comes from

Vincent Andrews, from Morgan Stanley. Please go ahead. Thank you very much. I'm actually late to

something else, but I wanted to stick around and just congratulate you, Tony, and say thank you, and good luck in the future. Hey, thank you, Vincent. I appreciate that.

The next question comes from Matthew D'Oye from Bank of America. Please go ahead.

Yeah, good morning. Tony, congrats on the run. I know I didn't cover you directly for much of the time, but Steve always, you know, held you with the highest regard, so I know that goes for the rest of us here at Team B of A. Thank you, Matt. Yeah, I wanted to ask, I guess, a little bit on the slide where we talk about, like, ammonia expansions and closures, certainly we don't disagree that a number of European plants need to close chemicals across, like, a lot of chains. But if we look at that three to four number, I mean, what's the, how much of that's been announced? What do you think the rates are that those plants are running? And then like, I just know that closing plants is expensive and not really done easily. So I'd love a little bit more kind of commentary around your outlook for that capacity. Yeah. So this, as you may recall,

is a study we did about a year and a half ago, ammonia plant on, you know, how its ownership structure was, what its maintenance structure, what its cost structure was going to be to try to identify which of those plants would come off. And Europe used to have about 48 ammonia assets. And what we've seen is the red plants have come off as we expected. And in fact, we're probably ahead with the number of curtailments and shutdowns that are occurring in Europe from that. or maybe 31 assets, drop another four, a couple of years. You have to remember the decision we made in the UK was because we had a significant turnaround coming forward. And these turnarounds are $50 to $60 million. So when you're entering into that, you have to make certain you're going to get that return on that cash. Additionally, where TTF is today at the $10 to $12 range, makes it difficult to be producing throughout 12 months of the year for really selling in, you know, what may be three months a year, maybe four months a year. So you're making a risk decision based on that. What you're seeing today is with some of the pricing, there's just a little bit more curtailment going on, but eventually we're going to see some of those plants continue to go off. So the European side, we feel very confident that that three to five, all that gets imported as net ammonia or is upgraded, that'll be determined. But I think the other aspect I mentioned, there is a visibility of what plants are being built. The two in the Gulf Coast will be sometime in 2026 and one in Qatar. There's really not much coming on. And the other plants that are coming on, the ammonia market even tighter. So what we see is a differential where we'll make money off of that versus TTF. And then we also see a S&D balance that not only continues here into 2026, but really goes all the way to 2026.

Thanks for that. I'll hand it back.

This concludes our question-and-answer session. I would like to turn the conference back over to Martin Jarasik for closing remarks.

Thanks, everyone, for joining us today. We look forward to speaking with you at future conferences.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.