Greetings and welcome to Nutrien's 2025 First Quarter Earnings Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. As a reminder, this conference call is being recorded. I would now like to turn the conference call over to Jeff Holzman, VP of Investor Relations.

Thank you, operator. Good morning and welcome to Nutrien's first quarter 2025 earnings call. As we conduct this call, various statements that we make about future expectations, plans 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 Seitz, Nutrien's 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. Nutrien's 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. U.S. 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 U.S. 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 grower customers in a dynamic market environment. Now turning to potash, global supply and demand fundamentals have strengthened significantly, and 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 tonnes. With the current level of demand testing existing global operating and supply chain capabilities, Canpotex 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 tonne 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 U.S., 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 Sinofert, 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 Nutrien's 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 on cost-saving 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 billion 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 year-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. Our 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 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 tonnes 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 Profertil. 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 tonnes, 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 Hub 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 Hub compared to 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 billion 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 first quarter and repurchasing 3.6 million shares for a total of $188 million as of May 6th. We intend on continuing to repurchase shares on a routable basis under our renewed NCIB 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.

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, for EBITDA, you give it just to retail. And I don't want to give you guidance, I want you, what I want to ask you is this, if I look at versus three months ago, what you had for your commodity price back, 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 this now than you would have thought three months ago because all the commodity prices have moved to good U.S. spring. Like, could you talk about that, that the outlook is improving or not to 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 next time.

Good morning, Joel. Yes, thank you for the question. The short answer is yes, we agree with your assessment of now versus three months ago. And yes, 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 in our view of 71 to 75 million tonnes of demand this year. And what we're seeing, we believe, is the intersection of the market, the ability to supply that, so maybe 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 Canpotex through Q2. And we could talk about what's happening in urea and UAN where we've seen supply disruptions and strong demand. With our retail business, we've talked about it's a story of halves as opposed to quarters, where with some weather delays in the first quarter, we're now about 50% planted. And we can add it over to Jeff Tarsi. Things are going strong with the planting season now, and 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 and 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've spent some time on the turnaround in Brazil, what does that look like for Nutrien as you kind of get into, let's say, 2026 and beyond?

Yes, thanks, Andrew. So again, the short answer is yes, we are on track. I mean, at the macro level, a Brazilian farmer had a strong soybean crop and soybean prices had strengthened. Of course, they're watching their corn crop grow at the moment, but all indications are that it'll be a strong corn crop as well. So the Brazilian farmer is 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?

Yes, and I'll just reiterate 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 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 receivables. 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, you know, we've idled our blending 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 head count by about 400. So, we've done a lot of work there over the last 12 to 18 months, and we're seeing the results of that.

Thanks, Jeff. And Andrew, as we look into 2026, I think you're going to 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. And I think, Jeff, it's fair to say we're watching crop chemistry quite closely. If there's one if there's one shelf of ours that hasn't caught up yet is on chemistry, and we'll be looking at the 2026 to see that. But we're still seeing competition from generics, and that's certainly stressing prices in that part of the world.

Yes, Ken, I failed to mention, and I don't want to leave this out, but 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 the 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 in wholesale? And I'm just trying to think through, you said about 90% 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 of that you might have captured in 2Q?

Yes, thanks, Vincent. Again, I would say that the first half in terms of our upstream businesses, we're constructive, and we can start with potash, where, again, with such strong global demand, we can go from market to market where, again, 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 tonnes 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. I'll be at 4,000 ringgits per tonne. 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 tonnes. 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 results of strengthening prices in just about every market that we serve. We can go over to nitrogen products, where here in the planting season, we've had really strong urea and UAN prices. Ammonia 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. Phosphate price is particularly strong. Market to market, wholesale business, our upstream business, we're constructive on the first half and frankly, into the balance of the year.

Your next question comes from Richard Garchitorena 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. Just wondering how much of this was related to Trinidad? Was this across all your facilities, obviously higher nitrogen 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.

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

Thanks, Ken. Yes, good morning, Rich. On your first question on nitrogen costs, Q1's pretty straightforward answer. Obviously, when we came into the year, we had expected to see Henry Hub prices in a range of $3.25 to $3.50 to begin the year. And natural gas prices began the year higher than we anticipated and in a 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. 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 $3.25 to $4. 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.

Yes, thanks, Mark. Good morning, Rich. As it relates to tariffs, some of the price increase we've seen, whether it be urea or UAN, may be from the imposition of tariffs from those countries that have the 10% imposed on them. But generally, the story is much more about demand. And as you heard from Ken in 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 two products.

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

Thank you very much and good morning. You gave global potash shipment guidance of 71 to 75 million tonnes, 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 Canpotex being sold out in Q2. Your Canpotex 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 respond to higher prices? Thank you.

Yes, thank you, Ben. And our 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 a guidance range that we have put out. We've maintained 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 mines, our flexible network, our ability to surge capacity when we need to. And an environment that's calling for those hard times. 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, you know, out of China, a decent amount out 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 expectations, 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 I'm 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, you know, your way of thinking and how that plays into your strategy for the balance of the year? Thank you so much.

Yes, Chris, thank you for the question. Again, I go back to the way demand is materializing this year and, you know, 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 confidence in that 71 to 75 million tonnes. We've talked about the constraint 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, you know, 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 Belarus. 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 the respond 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 LPI brands. And certainly we can talk about what's happening with Infinity?

Yes, thanks, Ken. Good morning, Steve. So, Steve, maybe just to take a step back. We've continued to say that over the past couple of years, 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've 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 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 of purchases. And we'll continue to evaluate those opportunities. So I'll pass it over to Jeff on your other questions.

Yes, good morning, Steve. I'll address a couple of your questions regarding our proprietary products. As you know, we had a delayed start in the first quarter this year. Last year, we experienced a strong beginning due to favorable weather conditions in the first quarter, while this year, we didn't benefit from the last two weeks of March in our current campaign. However, our revenue and margins from seed are up in the first quarter, mainly due to the shift from soybeans to corn, especially in the South, where corn acreage has increased by about 25%. While this growth may not significantly impact the entire U.S. acreage, it will contribute to the anticipated 5 million acre increase we project for the year. Our Dyna-Gro corn varieties are performing well, presenting a good opportunity for us to expand. We're very optimistic about our proprietary business; we forecast an 8% to 9% increase in gross margins this year for that portfolio of products. With the rise in corn acres and our focus on foliar nutritionals and bio stimulant products, we anticipate a successful campaign this year. Additionally, we have introduced 12 new products for this year and plan to launch as many as 20 new products by 2026. Specifically regarding Infinity, we are in the process of launching it, and I am eager to see the results as we implement our nitrogen applications. This is a nitrogen enhancement tool, and we are enthusiastic about the growth opportunities in our proprietary products segment over the next two years.

Your next question comes from Edlain 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. Potash or phosphate? When you look at the fundamentals over the next six months or the next 12 months, which one you think is better positioned? 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, Edlain, thank you for the question. 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 that again, we don't see any reason why we would see softening over the course of 2025. Potash is the story of 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% increases in potash prices since the start of the year. Again, we've increased our own domestic price three times. And so, as suppliers 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 price expectations? And just given your latest tuck-ins, do you think you can hit the $2 billion objective for 2026 with the existing platform?

Yes, no, thanks, Hamir. Yes, 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, you know, being a year ahead on our $200 billion of SG&A savings. We think about network optimization and we think about, yes, the potential for tuck-ins. And it certainly gives us confidence in getting into the bottom and our $1.9 billion to $2.1 billion EBITDA range for 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, you know, 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.

Yes, we're in that period of the year where we'd be slow on the tuck-in side of things, but 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 a 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, you know, 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. In my opinion, I think we've seen 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.

Yes, thanks, Jeff. Again, I don't have a lot to add. I think, Hamir, just 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 size 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 free 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 Fischer from Goldman Sachs. Please go ahead.

Yes, 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 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 U.S. 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?

Yes, I’ll start, Ken.

Go ahead, Jeff. Please.

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, 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. Ken, I don't know if you had anything.

No, thank you, Jeff. You know, just to say that, you know, 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, so, exactly.

Your next question comes from Jeff Zekauskas of JPMorgan. Please go ahead.

Thank you very much. In crop protection, your proprietary products in the quarter were down about 30%, and your gross profits were down about 35%. However, your non-proprietary crop protection products were down about 10%. What accounts for this difference? Additionally, what is the status of the potash negotiations in India and China? Lastly, regarding your nitrogen business, could you clarify how much nitrogen is exported in retail? Specifically, how much is exported to the United States, and is it facing any penalties due to tariffs? Thank you.

Thanks, Jeff. So, I'll hand it over to Jeff Tarsi 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, Jeff.

Yes, on the crop protection side of it as 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 reeds, we have different margin structure for those products as well, and it's also affected by some of the high-margin LPI products, adjuvants and surfactants and such. So, when you've got a 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're seeing evidence of that now. I'll pass the question over to Chris for the second part.

Yes, thanks, Jeff. And good morning, Jeff. Thanks for the question. Regarding China and India, Canpotex have started that engagement on those two contracts, but really been 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. As Ken alluded to, there's some Southeast Asia pricing right now that folks are looking to as an indicator. 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, Mark I'll hand it over to you.

Yes, 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've been 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 a direct impact from tariffs. More generally, as both Ken and Chris have spoken to on the call, we are seeing North America in a position where it's coming to the spring on a net short basis for products like UAN and Urea, 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 and we're very well positioned for the spring.

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

Yes, 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 synergies? And just secondarily, what else do you view as sort of a priority to review in terms of being non-core? Thanks.

Yes, thank you, Steve. 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, as we look closer, that 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 and we're going after some of that. But like I say, we do have confidence in our ability to do more and we're certainly encouraged by progress to date. With respect to the review of non-core assets, yes, that's something that we're looking very closely at the moment. We've talked about how we're viewing our Latin American South retail assets and looking for the market to cooperate with us a bit as we think about divestiture, albeit not material for us. We talked about the process that we're in as it relates to Profertil and just going through that process at the moment. We've talked about the divestiture of our Sinofert shares, which was a passive equity state that is really not strategic for us in the $223 million proceeds that we realized Q4 of last year at the start of this year. And yes, there are some other things that we're looking 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 Theurer of Barclays. Please go ahead.

Thank you very much for taking my question. I want to go back real quick and you had some of that in the prepared 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. So 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.

Yes, thanks, Ben, for the question. 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, you know, 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, 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.

Good morning. Yes, I just want 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 $4.5 billion to $5 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 purchases of 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 Nutrien 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 yes, it's also the case that we're watching the trade dispute between China and the U.S. quite closely, because crop protection is obviously a big part of that story. Now, a number of those products have been exempted when we look at the exemption list. And so, you know, for those that are exempted, obviously, we're encouraged by that, but there are products that haven't been. So, maybe I'll hand it over to Jeff to talk a little bit more about that.

Yes. Specifically regarding our proprietary products, 98% of those in the proprietary CP segment are outside of patent life, meaning they are generic products. We do multsource these products and source active ingredients from our multinational partners, as well as directly from China and India. In response to your question about sourcing, we source both finished goods and active ingredients. Currently, we are focusing on building our inventories for the 2026 year. We expect price increases on branded products in the range of 5% to 7.5%. For generic products, we might see the higher end of that range or more. Ken mentioned that many ingredients are exempt, but those exempt still come with a base increase of 10%. This situation is complex since these products can consist of 10 to 15 different components sourced from various locations. We will spend a lot of time over the next 60 days addressing this. We will proceed under the assumption that there will be tariffs as we prepare for the future. Overall, we anticipate price increases but do not believe they will significantly impact our earnings for 2025. We plan to pass these price increases on to our customers.

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

Just one more follow up on the phosphates business, please. You 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 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.

Yes, thank you for the question, David. Yes, 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 hand it 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. Yes, as Ken mentioned, we're seeing sulfur market fundamentals tightening. We've seen those tighten in the first half of the year and cap the sulfur prices in the second quarter for $270 a tonne. So, a pretty significant increase quarter over quarter and then definitely an increase from where we saw sulfur prices in 2024, which were historically discounted relative to profit prices and actually low from a marginal positive for cost perspective for producers, which meant that they were pouring product into the block or putting product in inventory rather than exporting. So, that tightened supply and coming into 2025, we've seen strong demand from China, strong demand from the base metal perspective in Southeast Asia. So, the combination of a 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 a 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 Investment 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.