Market Overview

Agrium Reports Solid Third Quarter and Expects Strong Fall Crop Input Demand

Share:

CALGARY, ALBERTA--(Marketwired - Nov. 5, 2015) -

ALL AMOUNTS ARE STATED IN U.S.$

Agrium Inc. (TSX:AGU) (NYSE: AGU) announced today 2015 third quarter net earnings from continuing operations of $99-million ($0.72 diluted earnings per share), compared to $91-million ($0.63 diluted earnings per share) in the third quarter of 2014. The increased net earnings are due to higher sales volumes of Wholesale nutrients combined with lower production costs in the Wholesale business unit, while Retail's earnings were similar to the prior year, despite weaker market conditions.

Highlights:



-- Third quarter adjusted net earnings of $97-million or $0.71 per share
and $5.73 per share year to date in 2015 on the same basis (see page 2
for adjusted net earnings reconciliation)(1).
-- Wholesale's results were boosted by nitrogen and potash performance,
which saw higher volumes and lower costs, leading to an improvement in
gross profit, despite lower nutrient prices.
-- Agrium achieved 94 percent ammonia capacity utilization in the third
quarter, exceeding the 90 percent target rate.
-- The Canpotex proving run is well underway at our Vanscoy potash facility
and is progressing as expected.
-- Retail EBITDA(2) in the U.S. and Australia were higher than the same
quarter last year reflecting Operational Excellence initiatives. Total
Retail EBITDA of $129-million for the quarter was in line with the prior
year, despite the impact of drought conditions in the Canadian business.
-- Agrium has repurchased 5.6 million shares since the beginning of April
under its current Normal Course Issuer Bid.
-- 2015 annual guidance range has been narrowed to $7.10 to $7.40 diluted
earnings per share (see page 3 for further details).



"Agrium's performance this quarter is another demonstration of the resilience of our business model. We focused on what we can control, improving our on-stream Wholesale performance and optimizing our distribution network and effectively managing costs in Retail, all of which helped drive a 9 percent increase in earnings over the same period last year despite prevailing market headwinds," commented Chuck Magro, Agrium's President and CEO. "We see strong crop input demand during the fall application season which is now in full swing and we are confident that our strategy and business structure can continue to deliver value to all our shareholders," added Mr. Magro.



(1) Forecasted annual effective tax rate of 27.5 percent used for adjusted
net earnings and per share calculations. These are non-IFRS measures
which represent net earnings adjusted for certain income (expenses) that
are considered to be non-operational in nature. We believe these
measures provide meaningful comparison to the earnings of other
companies by eliminating share-based payments expense (recovery), gains
(losses) on foreign exchange, gains (losses) on non-qualifying
derivative hedges and significant non-operating, non-recurring items.
These should not be considered as a substitute for, or superior to,
measures of financial performance prepared in accordance with IFRS and
may not be directly comparable to similar measures presented by other
companies.
(2) Earnings (loss) from continuing operations before finance costs, income
taxes, depreciation and amortization. This is a non-IFRS measure. Refer
to section "Additional IFRS and Non-IFRS Financial Measures" in the
Management's Discussion and Analysis.

ADJUSTED NET EARNINGS RECONCILIATION

----------------------------------------------------------------------------
Three months ended Nine months ended
September 30, 2015 September 30, 2015
----------------------------------------------------------------------------
(millions of U.S. Net Net
dollars, except earnings earnings
per share Expense impact Per Expense impact Per
amounts) (income) (post-tax) share(1) (income) (post-tax) share(1)
----------------------------------------------------------------------------
99 0.72 788 5.52
----------------------------------------------------------------------------
Adjustments:
----------------------------------------------------------------------------
Share-based
payments (15) (11) (0.08) 36 26 0.18
----------------------------------------------------------------------------
Loss on
derivatives net
of foreign
exchange 13 9 0.07 13 9 0.07
----------------------------------------------------------------------------
Gain on sale of
purchase for
resale assets - - - (38) (28) (0.19)
----------------------------------------------------------------------------
Tax rate
adjustment(2) - - - 21 21 0.15
----------------------------------------------------------------------------
Adjusted net
earnings(3) 97 0.71 816 5.73
----------------------------------------------------------------------------
(1) Represents diluted per share information attributable to equity holders
of Agrium.
(2) Tax rate adjustment mainly relates to the increase in current and
deferred taxes due to an increase in the Alberta corporate income tax
rate effective July 1, 2015.
(3) Forecasted annual effective tax rate of 27.5 percent used for adjusted
net earnings and per share calculations.



MARKET OUTLOOK

For the third consecutive year, favorable growing conditions have contributed to above-trend global grain yields. Even in geographies which faced challenging conditions early in the growing season, such as parts of the U.S. Corn Belt and Western Canada, yield prospects have come in stronger than anticipated. Despite historically high production, the outlook for grains is more positive than it was a year ago and as of the end of October 2015, cash corn prices were more than 10 percent above 2014 levels, although oilseed prices are lower year-over-year. Excluding China, the global grain stocks to use ratio is projected to decline to the lowest level since 2012/13 and the U.S. corn supply/demand balance is projected to tighten.

As a result of projected lower 2015/16 U.S. corn ending stocks, analysts project that U.S. corn area will increase in 2016. We expect normal North American crop nutrient application rates in the 2015/16 fertilizer year and expect that fall demand in 2015 will improve relative to 2014 levels as harvest progress is significantly ahead of last year, supporting a wider application window than the short 2014 season. In addition, we expect the overall planted acreage and crop mix to support increased crop nutrient demand.

The devaluation of most non-U.S. currencies over the past year has negatively impacted crop input demand and U.S. dollar prices. While growers in most market driven non-U.S. regions have realized a net benefit from lower local currency values due to improved local currency crop prices, crop nutrient prices in local currencies have increased significantly in some cases, which has been negative for demand. Currency devaluations have directly impacted crop nutrient demand and prices in Brazil and India. In Brazil, higher local prices, combined with lending constraints have negatively impacted import demand, however, downstream inventories have been drawn down to meet farm-level demand. In India, the devaluation of the rupee has pressured phosphate prices in order to be economical under the subsidy regime, while Indian buyers have delayed execution on some contracted potash volumes.

Globally, the downstream distribution network has been drawing on nutrient inventories to meet grower demand and purchasing on a just-in-time basis, which has led to relatively slow demand for all products. This has been the case in the U.S. urea market, as offshore imports of urea are estimated to be down 19 percent through the end of October 2015. The urea market has also been under pressure due to the combination of the devaluation of the Chinese yuan and lower anthracite coal prices, which have lowered the marginal cost of production. Chinese production levels in September in 2015 declined by 6 percent from August levels as a result of these market pressures and are expected to drop through the remainder of the year. Similarly for potash, strong shipments of potash in 2014 and the first half of 2015 allowed downstream inventories to increase. Buyers have been drawing upon these inventories in the second half of 2015, and prices have declined as spot sales volumes have declined. We expect pent-up demand to emerge late as fall applications occur and downstream inventories are drawn down. Similar to nitrogen and potash, phosphate demand has been slow in recent months, which has led to a reduction in phosphate production by some major producers.

UPDATED ANNUAL 2015 GUIDANCE

Based on our Market Outlook, Agrium expects to achieve annual diluted earnings per share of $7.10 to $7.40 in 2015 compared to our previous estimate of $7.00 to $7.50 per share. We have narrowed the guidance range but maintained a range width encompassing approximately $60-million of EBITDA variability to reflect the risk and opportunity associated with weather conditions and fall season length. We are assuming a normal fall season, recognizing there is always a risk that an early onset of inclement weather could bring an early close to the season. We have lowered the high-end and narrowed our anticipated Retail EBITDA range to $1.00-billion to $1.03-billion because of the impact of drought and lower crop prices on our Canadian operations in 2015.

Our annual nitrogen production target remains unchanged. We narrowed our potash production range to 1.95 million tonnes to 2.05 million tonnes for 2015.

We have updated the range for our annual effective tax rate for 2015 to 27 percent to 28 percent to reflect the anticipated geographic split of our global income. Our estimates of the Canada and U.S. foreign exchange rates and NYMEX for 2015 have been narrowed from our previous estimates based on current market conditions.

This guidance and updated additional measures and related assumptions are summarized in the table below. Guidance excludes the impact of share-based payments expense (recovery), gains (losses) on foreign exchange and non-qualifying derivative hedges and significant non-operating, non-recurring items.

2015 ANNUAL GUIDANCE RANGE AND ASSUMPTIONS



----------------------------------------------------------------------------
Annual
Low High
----------------------------------------------------------------------------
Diluted EPS $7.10 $7.40
----------------------------------------------------------------------------
Guidance assumptions:
----------------------------------------------------------------------------
Wholesale:
----------------------------------------------------------------------------
Production tonnes:
----------------------------------------------------------------------------
Nitrogen (millions)(1) 3.5 3.7
----------------------------------------------------------------------------
Potash (millions) 1.95 2.05
----------------------------------------------------------------------------
Retail:
----------------------------------------------------------------------------
EBITDA (millions) $1,000 $1,030
----------------------------------------------------------------------------
Crop nutrient sales tonnes (millions) 9.7 10.2
----------------------------------------------------------------------------
Other:
----------------------------------------------------------------------------
Finance costs (millions) $255 $240
----------------------------------------------------------------------------
Tax rate 28% 27%
----------------------------------------------------------------------------
Sustaining capital expenditures (millions) $500 $550
----------------------------------------------------------------------------
Total capital expenditures (billions) $1.2 $1.3
----------------------------------------------------------------------------
Canada/U.S. foreign exchange rate 1.26 1.28
----------------------------------------------------------------------------
NYMEX gas price ($/MMBtu) $2.85 $2.70
----------------------------------------------------------------------------
(1) Nitrogen production tonnes reduced to reflect disposal of West
Sacramento upgrade facility.



MANAGEMENT'S DISCUSSION AND ANALYSIS

November 4, 2015

Unless otherwise noted, all financial information in this Management's Discussion and Analysis ("MD&A") is prepared using accounting policies in accordance with International Financial Reporting Standards ("IFRS") and is presented in accordance with International Accounting Standard 34 - Interim Financial Reporting. All comparisons of results for the third quarter of 2015 (three months ended September 30, 2015) and for the nine months ended September 30, 2015 are against results for the third quarter of 2014 (three months ended September 30, 2014) and nine months ended September 30, 2014. All dollar amounts refer to United States ("U.S.") dollars except where otherwise stated. The financial measures EBITDA, Adjusted EBITDA and cash cost of product manufactured used in this MD&A are not prescribed by IFRS, or in the case of EBIT, is an additional IFRS financial measure. Our method of calculation may not be directly comparable to that of other companies. We consider these non-IFRS and additional IFRS financial measures to provide useful information to both management and investors in measuring our financial performance and financial condition. These non-IFRS financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with IFRS. Please refer to the section entitled "Additional IFRS and Non-IFRS Financial Measures" of this MD&A for further details, including a reconciliation of such measures to their most directly comparable measure calculated in accordance with IFRS.

The following interim MD&A is as of November 4, 2015 and should be read in conjunction with the Consolidated Interim Financial Statements for the three and nine months ended September 30, 2015 (the "Consolidated Financial Statements"), and the annual MD&A and financial statements for the year ended December 31, 2014 included in our 2014 Annual Report to Shareholders. The Board of Directors carries out its responsibility for review of this disclosure principally through its Audit Committee, comprised exclusively of independent directors. The Audit Committee reviews, and prior to publication, approves this disclosure, pursuant to the authority delegated to it by the Board of Directors. No update is provided to the disclosure in our annual MD&A where there has been no material change from the discussion in our annual MD&A. In respect of Forward-Looking Statements, please refer to the section titled "Forward-Looking Statements" section of this MD&A.

2015 Third Quarter Operating Results

CONSOLIDATED NET EARNINGS

Agrium's 2015 third quarter net earnings from continuing operations were $99-million or $0.72 diluted earnings per share from continuing operations compared to net earnings from continuing operations of $91-million or $0.63 diluted earnings per share from continuing operations for the same quarter of 2014.



Financial Overview

----------------------------------------------------------------------------
Three months ended Nine months ended
September 30, September 30,
(millions of U.S.
dollars, except
per share amounts % %
and where noted) 2015 2014 Change Change 2015 2014 Change Change
----------------------------------------------------------------------------
Sales 2,524 2,920 (396) (14) 12,388 13,337 (949) (7)
----------------------------------------------------------------------------
Gross profit 696 665 31 5 2,988 2,820 168 6
----------------------------------------------------------------------------
Expenses 505 560 (55) (10) 1,696 1,767 (71) (4)
----------------------------------------------------------------------------
Earnings before
finance costs and
income taxes
("EBIT") 191 105 86 82 1,292 1,053 239 23
----------------------------------------------------------------------------
Net earnings from
continuing
operations 99 91 8 9 788 728 60 8
----------------------------------------------------------------------------
Net loss from
discontinued
operations - (41) 41 (100) - (59) 59 (100)
----------------------------------------------------------------------------
Net earnings 99 50 49 98 788 669 119 18
----------------------------------------------------------------------------
Diluted earnings
per share from
continuing
operations 0.72 0.63 0.09 14 5.52 5.05 0.47 9
----------------------------------------------------------------------------
Diluted loss per
share from
discontinued
operations - (0.28) 0.28 (100) - (0.41) 0.41 (100)
----------------------------------------------------------------------------
Diluted earnings
per share 0.72 0.35 0.37 106 5.52 4.64 0.88 19
----------------------------------------------------------------------------
Effective tax rate
(%) 27 (20) N/A N/A 29 24 N/A N/A
----------------------------------------------------------------------------

Sales and Gross Profit

----------------------------------------------------------------------------
Three months ended Nine months ended
September 30, September 30,
(millions of U.S. dollars) 2015 2014 Change 2015 2014 Change
----------------------------------------------------------------------------
Sales
----------------------------------------------------------------------------
Retail 2,011 2,295 (284) 10,434 10,924 (490)
----------------------------------------------------------------------------
Wholesale 673 803 (130) 2,714 3,076 (362)
----------------------------------------------------------------------------
Other (160) (178) 18 (760) (663) (97)
----------------------------------------------------------------------------
2,524 2,920 (396) 12,388 13,337 (949)
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Gross profit
----------------------------------------------------------------------------
Retail 494 542 (48) 2,129 2,278 (149)
----------------------------------------------------------------------------
Wholesale 218 127 91 861 525 336
----------------------------------------------------------------------------
Other (16) (4) (12) (2) 17 (19)
----------------------------------------------------------------------------
696 665 31 2,988 2,820 168
----------------------------------------------------------------------------

-- Wholesale's sales volumes increased for all three crop nutrients for the
third quarter and for nitrogen and phosphate for the first nine months
of 2015 primarily as a result of higher operating rates. Realized
selling prices for the third quarter decreased as a result of weaker
market conditions but overall our average selling price increased for
the first nine months of 2015. Product purchased for resale contributed
to the decrease in sales as Agrium exited portions of this business.

-- Wholesale's gross profit significantly increased due to lower natural
gas input costs, manufacturing cost efficiencies and as a result of
higher nitrogen, potash and phosphate volumes produced for the third
quarter and first nine months of 2015 compared to the same periods last
year.

-- Retail's sales and gross profit decreased for the third quarter and
first nine months of 2015 compared to the same periods last year
primarily due to unfavorable weather conditions and competitive pricing
pressure as a result of lower crop prices which impacted most of our
product lines' sales and margins.



Expenses



-- General and administrative expense decreased by $9-million (13 percent)
for the third quarter and $27-million (12 percent) for the first nine
months of 2015 compared to the same periods last year as a result of
reduced payroll and office expense costs as we continue to realize
reductions related to our Operational Excellence program.



Share-based Payments



-- We had a share-based payment recovery of $15-million this quarter
compared to a share-based payment expense of $10-million for the third
quarter last year due primarily to the decrease in our share price.

-- As a result of our higher average share price for the first nine months
of 2015, our share-based payments expense increased by $11-million
compared to the same period last year.


Depreciation and Amortization

----------------------------------------------------------------------------
Three months ended September 30,
----------------------------------------------------------------------------
2015
----------------------------------------------------------------------------
Cost of General
product and
(millions of U.S. dollars) sold Selling administrative Total
----------------------------------------------------------------------------
Retail 2 62 1 65
----------------------------------------------------------------------------
Wholesale
----------------------------------------------------------------------------
Nitrogen 15
----------------------------------------------------------------------------
Potash 16
----------------------------------------------------------------------------
Phosphate 13
----------------------------------------------------------------------------
Other(1) 2
----------------------------------------------------------------------------
46 - 1 47
----------------------------------------------------------------------------
Other - - 3 3
----------------------------------------------------------------------------
Total 48 62 5 115
----------------------------------------------------------------------------


Depreciation and Amortization

---------------------------------------------------------------------------
Three months ended September 30,
---------------------------------------------------------------------------
2014
---------------------------------------------------------------------------
Cost of General
product and
(millions of U.S. dollars) sold Selling administrative Total
---------------------------------------------------------------------------
Retail 2 76 1 79
---------------------------------------------------------------------------
Wholesale
---------------------------------------------------------------------------
Nitrogen 23
---------------------------------------------------------------------------
Potash 19
---------------------------------------------------------------------------
Phosphate 12
---------------------------------------------------------------------------
Other(1) 3
---------------------------------------------------------------------------
57 - 1 58
---------------------------------------------------------------------------
Other - - 6 6
---------------------------------------------------------------------------
Total 59 76 8 143
---------------------------------------------------------------------------

----------------------------------------------------------------------------
Nine months ended September 30,
----------------------------------------------------------------------------
2015
----------------------------------------------------------------------------
Cost of General
product and
sold Selling administrative Total
----------------------------------------------------------------------------
Retail 5 180 3 188
----------------------------------------------------------------------------
Wholesale
----------------------------------------------------------------------------
Nitrogen 53
----------------------------------------------------------------------------
Potash 43
----------------------------------------------------------------------------
Phosphate 37
----------------------------------------------------------------------------
Other(1) 10
----------------------------------------------------------------------------
143 - 3 146
----------------------------------------------------------------------------
Other - - 11 11
----------------------------------------------------------------------------
Total 148 180 17 345
----------------------------------------------------------------------------


---------------------------------------------------------------------------
Nine months ended September 30,
---------------------------------------------------------------------------
2014
---------------------------------------------------------------------------
Cost of General
product and
sold Selling administrative Total
---------------------------------------------------------------------------
Retail 5 216 7 228
---------------------------------------------------------------------------
Wholesale
---------------------------------------------------------------------------
Nitrogen 65
---------------------------------------------------------------------------
Potash 50
---------------------------------------------------------------------------
Phosphate 38
---------------------------------------------------------------------------
Other(1) 15
---------------------------------------------------------------------------
168 - 4 172
---------------------------------------------------------------------------
Other - - 12 12
---------------------------------------------------------------------------
Total 173 216 23 412
---------------------------------------------------------------------------
(1) Includes product purchased for resale, ammonium sulfate, ESN and other
products.

-- Depreciation and amortization expense decreased for the third quarter
and first nine months of 2015 due to the change in our method of
depreciation from the straight-line basis to the units-of-production
basis for our Vanscoy potash facility mining and milling assets at the
beginning of 2015 and our reassessment of the useful lives of our
property, plant and equipment in our Retail business unit in the fourth
quarter of 2014 to reflect our expectations on the estimated future
economic benefits of our property, plant and equipment.



Other Expenses (Income)



----------------------------------------------------------------------------
Three months ended Nine months ended
September 30, September 30,
(millions of U.S. dollars) 2015 2014 2015 2014
----------------------------------------------------------------------------
Loss (gain) on derivatives not
designated as hedges, net of
foreign exchange 13 21 13 (16)
----------------------------------------------------------------------------
Interest income (19) (31) (52) (61)
----------------------------------------------------------------------------
Gain on sale of purchase for resale
assets - - (38) -
----------------------------------------------------------------------------
Environmental remediation and asset
retirement obligations 6 1 15 21
----------------------------------------------------------------------------
Bad debt (recovery) expense (4) - 28 30
----------------------------------------------------------------------------
Potash profit and capital tax 3 3 13 9
----------------------------------------------------------------------------
Other 9 13 22 26
----------------------------------------------------------------------------
8 7 1 9
----------------------------------------------------------------------------



In the first nine months of 2015, other expenses decreased by $8-million due to the following:



-- Gains of $33-million were recognized on natural gas derivatives in the
first nine months of 2014 and were recorded directly to other expenses.
2015 did not have comparable results, as starting January 1, 2015, we
began to designate all of our natural gas derivatives as qualifying
hedges for accounting purposes and the related gains or losses are
recorded as part of cost of product sold when we sell the related
product while unrealized gains or losses are recorded in equity.

-- We completed the sale of our Niota and Meredosia storage and
distribution facilities in the first quarter of 2015 resulting in a gain
on sale of purchase for resale assets of $38-million.



Effective Tax Rate



-- The effective tax rate on continuing operations of 27 percent for the
third quarter is higher than the tax rate of 18 percent in the
comparative quarter in 2014 (excluding the effect of the recognition of
a previously unrecognized tax benefit of $29-million) because of higher
earnings in higher taxed jurisdictions.

-- The effective tax rate of 29 percent for the first nine months of 2015
is higher than the rate of 27 percent for the same period last year
(excluding the effect of the recognition of a previously unrecognized
tax benefit) due to the increase in the Alberta provincial statutory tax
rate.



BUSINESS SEGMENT PERFORMANCE



Retail

----------------------------------------------------------------------------
Three months ended September 30,
(millions of U.S. dollars, except
where noted) 2015 2014 Change
----------------------------------------------------------------------------
Sales 2,011 2,295 (284)
----------------------------------------------------------------------------
Cost of product sold 1,517 1,753 (236)
----------------------------------------------------------------------------
Gross profit 494 542 (48)
----------------------------------------------------------------------------
EBITDA 129 130 (1)
----------------------------------------------------------------------------
Selling expense as a percentage of
sales (%) 22 20 2
----------------------------------------------------------------------------

-- Retail sales and gross profit during the quarter were lower than the
same period last year due to generally lower crop input prices, weaker
non-U.S. currency exchange rates and dry weather conditions in our
international and Canadian operations.

-- Regionally, the U.S. EBITDA contribution was up approximately 4 percent
over the same period last year. Australia reported a 40 percent increase
in EBITDA, due mostly to a focused effort in reducing overall operating
costs. Canada and South America EBITDA declined as poor growing
conditions hampered demand for all crop inputs.

-- Retail selling expenses as a percentage of sales were marginally higher
this quarter due to lower total sales. However, total selling expenses
were down $33-million compared to the same period last year as a result
of cost reductions primarily in our Canadian and Australian Retail
operations.

----------------------------------------------------------------------------
Three months ended September 30,
Gross
Sales Gross profit profit (%)
------------------ ------------------ -----------
(millions of U.S. dollars,
except where noted) 2015 2014 Change 2015 2014 Change 2015 2014
----------------------------------------------------------------------------
Crop nutrients 582 646 (64) 113 142 (29) 19 22
----------------------------------------------------------------------------
Crop protection products 1,040 1,132 (92) 234 232 2 23 21
----------------------------------------------------------------------------
Seed 60 54 6 26 27 (1) 43 50
----------------------------------------------------------------------------
Merchandise 166 256 (90) 25 36 (11) 15 14
----------------------------------------------------------------------------
Service and other 163 207 (44) 96 105 (9) 59 51
----------------------------------------------------------------------------



Crop nutrients



-- Total crop nutrient sales were 10 percent lower compared to the same
period last year due to a reduction in both average crop nutrient
selling prices as well as lower sales volumes.

-- Total crop nutrient volumes were 4 percent lower this quarter across our
Retail operations compared to the same period last year. Virtually all
of the reduction was due to lower demand in our International Retail,
due to dry conditions and lower planted wheat acreage. Despite lower
corn and total seeded acreage this year in North America, sales tonnes
in the region were relatively flat compared to the third quarter of
2014.

-- Crop nutrient margins on a per tonne basis were lower across all
regions. Margins from our international Retail declined by 28 percent
over the same period last year. North American operations were 15
percent lower as a result of declining crop nutrient prices.



Crop protection products



-- Total crop protection sales were down 8 percent year-over-year with most
of the reduction due to a combination of drought conditions impacting
sales within our Canadian operations, lower demand for insecticides in
the U.S. and lower prices for glyphosate products. International crop
protection sales also experienced a decline related to dry conditions in
those regions.

-- Crop protection margins as a percentage of sales increased year-over-
year, largely due to timing of rebates and new programs from suppliers
in the U.S. market. Additionally, proprietary crop protection margins as
a percentage of sales increased by 5 percent over the same period last
year with the most significant increases in Canada and Australia.



Seed



-- Seed sales were up 11 percent this quarter compared to the same period
last year. The increase was due primarily to excessive moisture
conditions in the Eastern U.S. during June, which pushed corn and
soybean seeding into July of this year. The excessive moisture also
prevented a significant amount of corn and soybean acreage in the region
from being planted and much of this area was seeded with wheat, rye
grass and other grass seed instead.
-- Seed sales and margins were negatively impacted by competitive pressures
across the seed industry, as well as lower sales volumes in Canada. Seed
margins as a percentage of sales were 43 percent this quarter compared
to 50 percent in 2014. Increased sales volumes of wheat, rye grass and
other grass seed, which are lower margin products, were a key
contributor to the lower margins.



Merchandise



-- Merchandise sales decreased compared to the same period last year as a
result of lower fuel prices and demand in Canada and lower animal health
sales in Australia.

-- Gross margin as a percentage of sales was higher this quarter due to a
decrease in lower margin Canadian fuel sales and our ability to maintain
a better cost position in the Australian business, which consistently
has higher margin products.



Services and other



-- Sales for services and other was down 21 percent this quarter, due
mainly to the closure of our livestock export business in Australia.
Application and other services sales, gross profit and gross margins
were all higher in North America compared to the same period last year.



Wholesale



----------------------------------------------------------------------------
Three months ended September 30,
(millions of U.S. dollars, except
where noted) 2015 2014 Change
----------------------------------------------------------------------------
Sales 673 803 (130)
----------------------------------------------------------------------------
Sales volumes (tonnes 000's) 1,667 1,856 (189)
----------------------------------------------------------------------------
Cost of product sold 455 676 (221)
----------------------------------------------------------------------------
Gross profit 218 127 91
----------------------------------------------------------------------------
Adjusted EBITDA 226 171 55
----------------------------------------------------------------------------
Expenses 44 27 17
----------------------------------------------------------------------------

-- Wholesale sales this quarter were lower than the same period last year
due to our decision to sell several non-core, lower-return purchase for
resale facilities in 2015 related to our on-going asset portfolio
review. Excluding this factor, Wholesale had higher product sales
volumes this quarter largely offset by lower selling prices for all
three crop nutrients. Adjusted EBITDA increased by $55-million over the
prior year, as a result of higher utilization rates from our nitrogen
and potash segments resulting in higher sales volumes and lower
production costs per tonne.

----------------------------------------------------------------------------
Three months ended September 30,
Nitrogen Potash Phosphate
---------------- ---------------- -----------------
2015 2014 Change 2015 2014 Change 2015 2014 Change
----------------------------------------------------------------------------
Gross profit (U.S. dollar
millions) 130 77 53 42 2 40 31 31 -
----------------------------------------------------------------------------
Sales volume (tonnes
000's) 760 735 25 384 251 133 269 261 8
----------------------------------------------------------------------------
Selling price ($/tonne) 388 438 (50) 279 313 (34) 629 663 (34)
----------------------------------------------------------------------------
Cost of product sold
($/tonne) 217 333 (116) 171 304 (133) 514 546 (32)
----------------------------------------------------------------------------
Gross margin ($/tonne) 171 105 66 108 9 99 115 117 (2)
----------------------------------------------------------------------------



Nitrogen



-- Nitrogen gross profit increased by 69 percent over the same period last
year, with results being driven by higher volumes and a significant
reduction in cost of product sold due to improved capacity utilization
rates and lower natural gas costs in the current period.

-- Sales volumes increased by 3 percent over the same period last year,
driven by stronger urea and ammonia sales. This increase was due to
higher on-stream time at our production facilities and product
availability compared to the same period last year.

-- Cost of product sold per tonne was 35 percent lower than the same period
last year. Operational improvements and higher on-stream time compared
to the same period in the prior year decreased fixed costs per tonne,
while lower natural gas costs reduced variable costs. The weaker
Canadian dollar also reduced operating costs at our Canadian plants.

-- Nitrogen margin per tonne was $171 per tonne, a 63 percent improvement
over the same period last year, despite an 11 percent reduction in
average selling prices.






Natural gas prices: North American indices and North American Agrium prices
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Three months ended
September 30,
(U.S. dollars per MMBtu) 2015 2014
----------------------------------------------------------------------------
Overall gas cost excluding realized derivative
impact $2.43 $4.01
----------------------------------------------------------------------------
Realized derivative impact $(0.04) $(0.01)
----------------------------------------------------------------------------
Overall gas cost $2.39 $4.00
----------------------------------------------------------------------------
Average NYMEX $2.77 $4.07
----------------------------------------------------------------------------
Average AECO $2.16 $3.70
----------------------------------------------------------------------------



As of January 1, 2015, we have designated all of our natural gas derivatives as accounting hedges(1), with realized gains and losses now recorded to cost of product sold (which also includes transportation and administration costs).



(1) In the prior year, unrealized and realized gains and losses on
derivatives not designated as hedges were included in other expenses.



Potash



-- Potash gross profit this quarter was $40-million higher than the same
period last year, due to the turnaround to tie-in the Vanscoy capacity
expansion that started in the third quarter of 2014 leading to lower
sales and margin in the prior year.

-- Sales volumes were 53 percent higher compared to the same period in the
prior year. Production volumes this quarter were 560,000 tonnes.

-- Realized sales prices were lower than the same period last year due to
competitive pricing pressure in both domestic and international markets.

-- Cost of product sold was reduced as a result of cost efficiencies
associated with the continuing ramp-up of the Vanscoy expansion, as well
as weakening of the Canadian dollar. As a result, cash cost of product
manufactured continues to improve and is $89 per tonne in the current
quarter compared to $110 per tonne in the second quarter of 2015.



Phosphate



-- Phosphate gross profit was unchanged from the prior year.

-- Sales volumes were slightly higher than last year, while reduced selling
prices were largely offset by lower cost of production. As a result,
phosphate margins were only 2 percent lower than the same quarter last
year.



Wholesale Other



Wholesale Other: gross profit breakdown

----------------------------------------------------------------------------
Three months ended September 30,
(millions of U.S. dollars) 2015 2014 Change
----------------------------------------------------------------------------
Product purchased for resale 2 6 (4)
----------------------------------------------------------------------------
Ammonium sulfate 10 8 2
----------------------------------------------------------------------------
Environmentally Smart Nitrogen
("ESN(R)") 6 4 2
----------------------------------------------------------------------------
Other (3) (1) (2)
----------------------------------------------------------------------------
15 17 (2)
----------------------------------------------------------------------------

-- Gross profit for Wholesale's Other product category decreased this
quarter primarily due to lower sales volumes and gross profit for the
product purchased for resale business, as these operations were
significantly scaled back earlier in 2015 as part of our portfolio
review.

-- ESNr gross profit increased this quarter due to slightly higher sales
volumes and lower cost of product sold, which was partly offset by lower
selling prices.



Wholesale Earnings from Equity Investees



-- Agrium's share of earnings from equity investees saw a loss of $10-
million during the quarter. MOPCO experienced gas curtailments
throughout the quarter which restricted nitrogen production. Profertil's
sales volumes and costs were impacted by an extended outage during the
current quarter.



Other

EBITDA for our Other non-operating business unit for the third quarter of 2015 had a net expense of $44-million, compared to a net expense of $40-million for the third quarter of 2014. The variance was due to the following:



-- A $12-million higher gross profit elimination expense as a result of
higher inter-segment inventory held at the end of the third quarter of
2015;

-- A $22-million increase in other expenses primarily due to higher
provisions for environmental remediation and asset retirement
obligations and an interest recovery received in 2014; and

-- A $15-million share-based payment recovery for the third quarter of 2015
compared to a $10-million share-based payment expense for the same
period last year due to a decrease in Agrium's share price in 2015.



FINANCIAL CONDITION

The following are changes to working capital on our Consolidated Balance Sheets for the nine-month period ended September 30, 2015 compared to December 31, 2014.



----------------------------------------------------------------------------
(millions of
U.S. dollars,
except where September December Explanation of the
noted) 30, 2015 31, 2014 $ Change % Change change in balance
----------------------------------------------------------------------------
Current assets
Cash and cash 753 848 (95) (11%) See discussion under
equivalents the section
"Liquidity and
Capital Resources".
----------------------------------------------------------------------------
Accounts 2,927 2,075 852 41% Seasonal sales
receivable activity for Retail
resulted in higher
Retail trade and
vendor rebates
receivable.
----------------------------------------------------------------------------
Income taxes 12 138 (126) (91%) The 2015 tax
receivable provision exceeded
tax installment
payments made net of
current period tax
refunds.
----------------------------------------------------------------------------
Inventories 2,759 3,505 (746) (21%) Inventory drawdown
due to seasonal
sales activity.
----------------------------------------------------------------------------
Prepaid 165 710 (545) (77%) Drawdown of prepaid
expenses and inventory where
deposits Retail typically
prepays for product
at year end and
takes possession of
inventory throughout
the year.
----------------------------------------------------------------------------
Other current 148 122 26 21% -
assets
----------------------------------------------------------------------------
Current
liabilities
Short-term 1,782 1,527 255 17% New drawings for
debt cash needs,
partially offset by
using the proceeds
from the issuance of
debentures to repay
commercial paper and
credit facilities.
----------------------------------------------------------------------------
Accounts 2,923 4,197 (1,274) (30%) Drawdown in customer
payable prepayments during
the spring
application season,
reductions in trade
payables as the
third quarter is
typically a low
point for product
purchasing, and
reductions in
accruals related to
Wholesale capital
expansion projects
in 2015.
----------------------------------------------------------------------------
Income taxes 59 5 54 1,080% The 2015 tax
payable provision exceeded
tax installment
payments made in
Canada.
----------------------------------------------------------------------------
Current 11 11 - 0% -
portion of
long-term
debt
----------------------------------------------------------------------------
Current 82 113 (31) (27%) -
portion of
other
provisions
----------------------------------------------------------------------------
Working capital 1,907 1,545 362 23%
----------------------------------------------------------------------------
----------------------------------------------------------------------------



LIQUIDITY AND CAPITAL RESOURCES

Summary of Consolidated Statements of Cash Flows

Below is a summary of our cash provided by or used in operating, investing, and financing activities as reflected in the Consolidated Statements of Cash Flows:



----------------------------------------------------------------------------
Nine months ended September 30,
(millions of U.S. dollars) 2015 2014 Change
----------------------------------------------------------------------------
Cash provided by operating
activities 570 332 238
----------------------------------------------------------------------------
Cash used in investing activities (1,182) (1,577) 395
----------------------------------------------------------------------------
Cash provided by financing
activities 484 771 (287)
----------------------------------------------------------------------------
Effect of exchange rate changes on
cash and cash equivalents 33 (37) 70
----------------------------------------------------------------------------
Decrease in cash and cash
equivalents from continuing
operations (95) (511) 416
----------------------------------------------------------------------------
Cash and cash equivalents used in
discontinued operations - (16) 16
----------------------------------------------------------------------------

----------------------------------------------------------------------------
----------------------------------------------------------------------------
Cash provided by operating activities - Drivers behind the $238-million
increase
----------------------------------------------------------------------------
Source of cash - $202-million change related to taxes paid of $81-million
in the first nine months of 2015 compared to taxes paid
of $283-million in the same period in 2014 resulting
from an increase in tax refunds in Canada.
----------------------------------------------------------------------------
Cash used in investing activities - Drivers behind the $395-million decrease
in use
----------------------------------------------------------------------------
Use of cash - Lower capital expenditures in the first nine months of
2015 due to the completion of the tie-in of our Vanscoy
potash mine expansion at the end of 2014.
----------------------------------------------------------------------------
Cash provided by financing activities - Drivers behind the $287-million
decrease
----------------------------------------------------------------------------
Source of cash - Received $1-billion proceeds from issuance of long-term
debt in the first nine months of 2015.
Lower issuance of our commercial paper in the first nine
months of 2015 as we received proceeds from our long-
term debt.
----------------------------------------------------------------------------
Use of cash - Repurchased common shares for $559-million in the first
nine months of 2015; no similar activity in the same
period in 2014.
----------------------------------------------------------------------------
----------------------------------------------------------------------------

Capital Spending and Expenditures(1)
----------------------------------------------------------------------------
Three months ended Nine months ended
September 30, September 30,
----------------------------------------------------------------------------
(millions of U.S. dollars) 2015 2014 2015 2014
----------------------------------------------------------------------------
Retail
----------------------------------------------------------------------------
Sustaining 11 25 103 129
----------------------------------------------------------------------------
Investing 8 9 25 29
----------------------------------------------------------------------------
19 34 128 158
----------------------------------------------------------------------------
Acquisitions(2) 1 129 85 147
----------------------------------------------------------------------------
20 163 213 305
----------------------------------------------------------------------------
Wholesale
----------------------------------------------------------------------------
Sustaining 72 96 199 292
----------------------------------------------------------------------------
Investing 77 381 578 1,061
----------------------------------------------------------------------------
149 477 777 1,353
----------------------------------------------------------------------------
Corporate & Other
----------------------------------------------------------------------------
Sustaining 1 2 3 2
----------------------------------------------------------------------------
Investing 1 2 2 4
----------------------------------------------------------------------------
2 4 5 6
----------------------------------------------------------------------------
Total
----------------------------------------------------------------------------
Sustaining 84 123 305 423
----------------------------------------------------------------------------
Investing 86 392 605 1,094
----------------------------------------------------------------------------
170 515 910 1,517
----------------------------------------------------------------------------
Acquisitions(2) 1 129 85 147
----------------------------------------------------------------------------
171 644 995 1,664
----------------------------------------------------------------------------
(1) Excludes capitalized borrowing costs.
(2) Represents business acquisitions and includes acquired working capital;
property, plant and equipment; intangibles; goodwill; and, investments
in associates and joint ventures.

-- Our investing capital expenditures decreased in the first nine months of
2015 compared to the first nine months of 2014 due to the completion of
the tie-in of our Vanscoy potash facility expansion in the fourth
quarter of 2014, partially offset by expenditures relating to the Borger
nitrogen expansion project.

-- Our sustaining capital expenditures decreased in the first nine months
of 2015 as we had less turnarounds compared to the same period last
year.

-- We expect Agrium's capital expenditures in the fourth quarter of 2015 to
approximate $200--million to $300-million in 2015. We anticipate that we
will be able to finance the announced projects through a combination of
cash provided from operating activities and existing credit facilities.



Short-term Debt



-- Our short-term debt of $1.8-billion at September 30, 2015 is outlined in
note 5 of our Summarized Notes to the Consolidated Financial Statements.

-- Our short-term debt increased by $1.1-billion during the three months
ended September 30, 2015, which in turn contributed to a decrease in our
unutilized short-term financing capacity to $1.1-billion at September
30, 2015.



Capital Management



-- Our revolving credit facilities require that we maintain specific
interest coverage and debt-to-capital ratios, as well as other non-
financial covenants as defined in our credit agreements. We were in
compliance with all covenants at September 30, 2015.



NORMAL COURSE ISSUER BID

In January 2015, the Toronto Stock Exchange ("TSX") accepted Agrium's notice of intention to make a normal course issuer bid ("NCIB") whereby Agrium may purchase up to 7,185,866 common shares on the TSX and New York Stock Exchange during the period from January 26, 2015 to January 25, 2016. During the nine months ended September 30, 2015, we purchased 5,574,331 shares at an average share price of $100.25 for total consideration of $559-million. Shareholders can obtain a free copy of the NCIB notice submitted to the TSX from Agrium upon request.

OUTSTANDING SHARE DATA

Agrium had 138,169,000 outstanding shares at October 31, 2015. At that date, under our stock option plans, shares expected to be issued for options outstanding were negligible.



SELECTED QUARTERLY INFORMATION

----------------------------------------------------------------------------
(millions of U.S.
dollars, except per 2015 2015 2015 2014 2014 2014 2014 2013
share amounts) Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4
----------------------------------------------------------------------------
Sales 2,524 6,992 2,872 2,705 2,920 7,338 3,079 2,867
----------------------------------------------------------------------------
Gross profit 696 1,708 584 732 665 1,599 556 740
----------------------------------------------------------------------------
Net earnings from
continuing
operations 99 675 14 70 91 625 12 110
----------------------------------------------------------------------------
Net loss from
discontinued
operations - - - (19) (41) (9) (9) (11)
----------------------------------------------------------------------------
Net earnings 99 675 14 51 50 616 3 99
----------------------------------------------------------------------------
Earnings per share
from continuing
operations
attributable to
equity holders of
Agrium:
----------------------------------------------------------------------------
Basic and diluted 0.72 4.71 0.08 0.46 0.63 4.34 0.08 0.74
----------------------------------------------------------------------------
Loss per share from
discontinued
operations
attributable to
equity holders of
Agrium:
----------------------------------------------------------------------------
Basic and diluted - - - (0.13) (0.28) (0.06) (0.06) (0.08)
----------------------------------------------------------------------------
Earnings per share
attributable to
equity holders of
Agrium:
----------------------------------------------------------------------------
Basic and diluted 0.72 4.71 0.08 0.33 0.35 4.28 0.02 0.66
----------------------------------------------------------------------------



The agricultural products business is seasonal in nature. Consequently, comparisons made on a year-over-year basis are more appropriate than quarter-over-quarter comparisons. Crop input sales are primarily concentrated in the spring and fall crop input application seasons. Crop nutrient inventories are normally accumulated leading up to each application season. Our cash collections from accounts receivables generally occur after the application season is complete and our customer prepayments are mostly concentrated in December and January.

ADDITIONAL IFRS AND NON-IFRS FINANCIAL MEASURES

Certain financial measures in this MD&A are not prescribed by IFRS. We consider these financial measures discussed herein to provide useful information to both management and investors in measuring our financial performance and financial condition.

In general, an additional IFRS financial measure is a measure relevant to understanding a company's financial performance that is not a minimum financial statement measure mandated by IFRS. A non-IFRS financial measure generally either excludes or includes amounts not excluded or included in the most directly comparable measure calculated and presented in accordance with IFRS. Non-IFRS financial measures are not recognized measures under IFRS and our method of calculation may not be directly comparable to that of other companies. These non-IFRS measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with IFRS.
The following table outlines our additional IFRS financial measure, its definition and why management uses such measure.



----------------------------------------------------------------------------
Additional IFRS
financial Why We Use the Measure and
measure Definition Why it is Useful to Investors
----------------------------------------------------------------------------
EBIT Earnings (loss) from Provides management and
continuing operations before investors with information
finance costs and income for comparison of our
taxes. operating results to the
operating results of other
companies. This measure
eliminates the impact of
finance and tax structure
variables that exist between
entities.
----------------------------------------------------------------------------



The following table outlines our non-IFRS financial measures, their definitions and why management uses each measure.



----------------------------------------------------------------------------
Non-IFRS
financial Why We Use the Measure and
measures Definition Why it is Useful to Investors
----------------------------------------------------------------------------
EBITDA Earnings (loss) from Refer to EBIT. EBITDA is also
continuing operations before frequently used by investors
finance costs, income taxes, and analysts for valuation
depreciation and purposes when multiplied by a
amortization. factor to estimate the
enterprise value of a
company. EBITDA is also a
component in the
determination of annual
incentive compensation for
certain management employees,
and in calculation of certain
of our debt covenants.
----------------------------------------------------------------------------
Adjusted EBITDA EBITDA before finance costs, Useful in evaluating our
income taxes, depreciation business performance by
and amortization of joint including our proportionate
ventures. share of joint ventures in
operating results.
----------------------------------------------------------------------------
Cash cost of All fixed and variable costs Enables investors to better
product are accumulated in cost of understand the performance of
manufactured product manufactured our manufacturing operations
("COPM") ("COPM"). Cash COPM excludes in comparison to other crop
depreciation and amortization nutrient producers. When COPM
expense. Fixed costs per costs are divided by the
tonne will fluctuate as production tonnes for the
production tonnage period, the result is actual
fluctuates. Fixed costs will COPM per tonne, which is
remain constant whether or compared to the standard COPM
not tonnes are produced. per tonne - a calculation of
Variable costs per tonne fixed and variable costs for
remain constant as production a standard or typical period
tonnage fluctuates. Variable of production. The standard
costs fluctuate as production COPM per tonne is multiplied
tonnage fluctuates. Direct by the production tonnes for
freight is a transportation the period, and the resulting
cost to move the product from dollar amount is transferred
an Agrium location to the to inventory. Any remaining
point of sale. It is not a costs are recorded directly
component of COPM. to cost of product sold as
production volume or cost
efficiency variances. There
is no directly comparable
IFRS measure for cash cost of
product manufactured.
----------------------------------------------------------------------------



RECONCILIATIONS OF ADDITIONAL IFRS AND NON-IFRS FINANCIAL MEASURES



Adjusted EBITDA and EBITDA to EBIT

----------------------------------------------------------------------------
Three months ended
September 30, 2015
(millions of U.S. dollars) Retail Wholesale Other Consolidated
-------------------------------------------
Adjusted EBITDA 129 226 (44) 311
----------------------------------------------------------------------------
Equity accounted joint ventures:
Finance costs and income taxes - 1 - 1
----------------------------------------------------------------------------
Depreciation and amortization - 4 - 4
----------------------------------------------------------------------------
EBITDA 129 221 (44) 306
----------------------------------------------------------------------------
Depreciation and amortization 65 47 3 115
----------------------------------------------------------------------------
EBIT 64 174 (47) 191
----------------------------------------------------------------------------

Adjusted EBITDA and EBITDA to
EBIT

----------------------------------------------------------------------------
Three months ended
September 30, 2014
(millions of U.S. dollars) Retail Wholesale Other Consolidated
-------------------------------------------
Adjusted EBITDA 130 171 (40) 261
----------------------------------------------------------------------------
Equity accounted joint ventures:
Finance costs and income taxes - 8 - 8
----------------------------------------------------------------------------
Depreciation and amortization - 5 - 5
----------------------------------------------------------------------------
EBITDA 130 158 (40) 248
----------------------------------------------------------------------------
Depreciation and amortization 79 58 6 143
----------------------------------------------------------------------------
EBIT 51 100 (46) 105
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Nine months ended
September 30, 2015
(millions of U.S. dollars) Retail Wholesale Other Consolidated
-------------------------------------------
Adjusted EBITDA 834 950 (129) 1,655
----------------------------------------------------------------------------
Equity accounted joint ventures:
Finance costs and income taxes - 6 - 6
----------------------------------------------------------------------------
Depreciation and amortization - 12 - 12
----------------------------------------------------------------------------
EBITDA 834 932 (129) 1,637
----------------------------------------------------------------------------
Depreciation and amortization 188 146 11 345
----------------------------------------------------------------------------
EBIT 646 786 (140) 1,292
----------------------------------------------------------------------------


----------------------------------------------------------------------------
Nine months ended
September 30, 2014
(millions of U.S. dollars) Retail Wholesale Other Consolidated
-------------------------------------------
Adjusted EBITDA 938 671 (114) 1,495
----------------------------------------------------------------------------
Equity accounted joint ventures:
Finance costs and income taxes - 20 - 20
----------------------------------------------------------------------------
Depreciation and amortization - 10 - 10
----------------------------------------------------------------------------
EBITDA 938 641 (114) 1,465
----------------------------------------------------------------------------
Depreciation and amortization 228 172 12 412
----------------------------------------------------------------------------
EBIT 710 469 (126) 1,053
----------------------------------------------------------------------------



CRITICAL ACCOUNTING ESTIMATES

We prepare our financial statements in accordance with IFRS, which requires us to make judgments, assumptions and estimates in applying accounting policies. For further information on the Company's critical accounting estimates, refer to the section "Critical Accounting Estimates" in our 2014 annual MD&A, which is contained in our 2014 Annual Report. Since the date of our 2014 annual MD&A, there have not been any material changes to our critical accounting estimates.

CHANGES IN ACCOUNTING POLICIES

The accounting policies applied in our Consolidated Financial Statements for the three and nine months ended September 30, 2015 are the same as those applied in our audited annual financial statements in our 2014 Annual Report, with the exception of changes in accounting estimates described in note 9 of our Summarized Notes to the Consolidated Financial Statements for the three months ended March 31, 2015.

BUSINESS RISKS

The information presented in the "Enterprise Risk Management" section on pages 64 - 68 in our 2014 Annual Report and under the heading "Risk Factors" on pages 22 - 31 in our 2014 Annual Information Form has not changed materially since December 31, 2014.

CONTROLS AND PROCEDURES

There have been no changes in our internal control over financial reporting during the nine months ended September 30, 2015 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PUBLIC SECURITIES FILINGS

Additional information about our Company, including our 2014 Annual Information Form is filed with the Canadian securities regulatory authorities through SEDAR at www.sedar.com and with the U.S. securities regulatory authorities through EDGAR at www.sec.gov.

Forward-Looking Statements

Certain statements and other information included in this document constitute "forward-looking information" and/or "financial outlook" within the meaning of applicable Canadian securities legislation or constitute "forward-looking statements" within the meaning of applicable U.S. securities legislation (collectively, the "forward-looking statements"). All statements in this document other than those relating to historical information or current conditions are forward-looking statements, including, but not limited to, statements as to management's expectations with respect to: 2015 annual guidance, expectations regarding nitrogen and potash production volumes; capital spending expectations for the remainder of 2015; expectations regarding 2015 production volumes at our Vanscoy potash facility; and our market outlook for the remainder of 2015 and 2016, including anticipated supply and demand for our products and services, expected market and industry conditions with respect to crop nutrient application rates, planted acres, crop mix, prices and the impact of currency fluctuations and import and export volumes. These forward-looking statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from such forward-looking statements. As such, undue reliance should not be placed on these forward-looking statements. The purpose of the outlook provided herein is to assist readers in understanding our expected and targeted financial and operating results, and this information may not be appropriate for other purposes.

All of the forward-looking statements are qualified by the assumptions that are stated or inherent in such forward-looking statements, including the assumptions referred to below and elsewhere in this document. Although Agrium believes that these assumptions are reasonable, this list is not exhaustive of the factors that may affect any of the forward-looking statements and the reader should not place an undue reliance on these assumptions and such forward-looking statements. The additional key assumptions that have been made include, among other things assumptions with respect to Agrium's ability to successfully integrate and realize the anticipated benefits of its already completed and future acquisitions and that we will be able to implement our standards, controls, procedures and policies at any acquired businesses to realize the expected synergies; that future business, regulatory and industry conditions will be within the parameters expected by Agrium, with respect to prices, margins, product availability and supplier agreements; the completion of our expansion projects on schedule, as planned and on budget; assumptions with respect to global economic conditions and the accuracy of our market outlook expectations for the remainder of 2015 and 2016; the adequacy of our cash generated from operations and our ability to access our credit facilities or capital markets for additional sources of financing; our ability to identify suitable candidates for acquisitions and negotiate acceptable terms; our ability to maintain our investment grade rating and achieve our performance targets; and our receipt, on time, of all necessary permits, utilities and project approvals with respect to our expansion projects and that we will have the resources necessary to meet the projects' approach. Also refer to the discussion under the heading "Key Assumptions and Risks in Respect of Forward-Looking Statements" in our 2014 annual MD&A, with respect to further material assumptions associated with our forward-looking statements.

Events or circumstances that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to: general economic, market and business conditions; weather conditions, including impacts from regional flooding and/or drought conditions; crop yield and prices; the supply and demand and price levels for our major products may vary from what we currently anticipate; governmental and regulatory requirements and actions by governmental authorities, including changes in government policy, government ownership requirements, changes in environmental, tax and other laws or regulations and the interpretation thereof, and political risks, including civil unrest, actions by armed groups or conflict, regional natural gas supply restrictions, as well as counterparty and sovereign risk; delays in completion of turnarounds at our major facilities; the risk that work on the MOPCO nitrogen facility expansion in Egypt may be interrupted again and may not be completed on the timelines currently anticipated or at all; the risk of additional capital expenditure cost escalation or delays in respect of our Borger nitrogen expansion project and the ramp-up of production following the tie-in of our Vanscoy potash expansion project; and other risk factors detailed from time to time in Agrium reports filed with the Canadian securities regulators and the Securities and Exchange Commission in the U.S. including those disclosed under the heading "Risk Factors" in our Annual Information Form for the year ended December 31, 2014 and under the headings "Enterprise Risk Management" and "Key Assumptions and Risks in respect of Forward-Looking Statements" in our 2014 annual MD&A.

The purpose of our expected diluted earnings per share guidance range is to assist readers in understanding our expected and targeted financial results, and this information may not be appropriate for other purposes.

Agrium disclaims any intention or obligation to update or revise any forward-looking statements in this document as a result of new information or future events, except as may be required under applicable U.S. federal securities laws or applicable Canadian securities legislation.

OTHER

Agrium Inc. is a major producer and distributor of agricultural products and services in North America, South America, Australia and Egypt through its agricultural retail-distribution and wholesale nutrient businesses. Agrium supplies growers with key products and services such as crop nutrients, crop protection, seed, and agronomic and application services, thereby helping to meet the ever growing global demand for food and fiber. Agrium produces nitrogen, potash and phosphate fertilizers, with a combined wholesale nutrient capacity of over nine million tonnes and with competitive advantages across all product lines. Agrium retail-distribution has an unmatched network of over 1,300 facilities and over 3,000 crop consultants. We partner with over half a million grower customers globally to help them increase their yields and returns on more than 50 different crops. With a focus on sustainability, the company strives to improve the communities in which it operates through safety, education, environmental improvement and new technologies such as the development of precision agriculture and controlled release nutrient products. Agrium is focused on driving operational excellence across our businesses, pursuing value-enhancing growth opportunities and returning capital to shareholders. For more information visit: www.agrium.com.

A WEBSITE SIMULCAST of the 2015 3rd Quarter Conference Call will be available in a listen-only mode beginning Thursday, November 5th, 2015 at 9:30 a.m. MST (11:30 a.m. EST). Please visit the following website: www.agrium.com.



AGRIUM INC.
Consolidated Statements of Operations
(Millions of U.S. dollars, except per share amounts)
(Unaudited)

Three months ended Nine months ended
September 30, September 30,
----------------------------------------------------------------------------
2015 2014 2015 2014
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Sales 2,524 2,920 12,388 13,337
----------------------------------------------------------------------------
Cost of product sold 1,828 2,255 9,400 10,517
----------------------------------------------------------------------------
Gross profit 696 665 2,988 2,820
----------------------------------------------------------------------------
Expenses
----------------------------------------------------------------------------
Selling 441 480 1,456 1,533
----------------------------------------------------------------------------
General and administrative 61 70 194 221
----------------------------------------------------------------------------
Share-based payments (15) 10 36 25
----------------------------------------------------------------------------
Loss (earnings) from associates
and joint ventures 10 (7) 9 (21)
----------------------------------------------------------------------------
Other expenses (note 3) 8 7 1 9
----------------------------------------------------------------------------
Earnings before finance costs and
income taxes 191 105 1,292 1,053
----------------------------------------------------------------------------
Finance costs related to long-term
debt 41 15 128 43
----------------------------------------------------------------------------
Other finance costs 14 14 51 49
----------------------------------------------------------------------------
Earnings before income taxes 136 76 1,113 961
----------------------------------------------------------------------------
Income taxes 37 (15) 325 233
----------------------------------------------------------------------------
Net earnings from continuing
operations 99 91 788 728
----------------------------------------------------------------------------
Net loss from discontinued
operations - (41) - (59)
----------------------------------------------------------------------------
Net earnings 99 50 788 669
----------------------------------------------------------------------------
Attributable to:
----------------------------------------------------------------------------
Equity holders of Agrium 101 50 787 667
----------------------------------------------------------------------------
Non-controlling interest (2) - 1 2
----------------------------------------------------------------------------
Net earnings 99 50 788 669
----------------------------------------------------------------------------

Earnings per share attributable to
equity holders of Agrium (note 4)
----------------------------------------------------------------------------
Basic and diluted earnings per
share from continuing operations 0.72 0.63 5.52 5.05
----------------------------------------------------------------------------
Basic and diluted loss per share
from discontinued operations - (0.28) - (0.41)
----------------------------------------------------------------------------
Basic and diluted earnings per
share 0.72 0.35 5.52 4.64
----------------------------------------------------------------------------
See accompanying notes.

AGRIUM INC.
Consolidated Statements of Comprehensive Income
(Millions of U.S. dollars)
(Unaudited)

Three months ended Nine months ended
September 30, September 30,
----------------------------------------------------------------------------
2015 2014 2015 2014
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Net earnings 99 50 788 669
----------------------------------------------------------------------------
Other comprehensive loss
----------------------------------------------------------------------------
Items that are or may be
reclassified to earnings
----------------------------------------------------------------------------
Cash flow hedges
----------------------------------------------------------------------------
Effective portion of changes
in fair value (10) (3) (30) (7)
----------------------------------------------------------------------------
Deferred income taxes on
changes in fair value 3 1 8 2
----------------------------------------------------------------------------
Share of comprehensive loss of
associates and joint ventures (2) (4) (7) (2)
----------------------------------------------------------------------------
Foreign currency translation
----------------------------------------------------------------------------
Losses (294) (195) (532) (199)
----------------------------------------------------------------------------
Reclassifications to
earnings - - 1 -
----------------------------------------------------------------------------
(303) (201) (560) (206)
----------------------------------------------------------------------------
Items that will never be
reclassified to earnings
----------------------------------------------------------------------------
Post-employment benefits
----------------------------------------------------------------------------
Actuarial losses - - - (20)
----------------------------------------------------------------------------
Deferred income taxes - - 1 6
----------------------------------------------------------------------------
- - 1 (14)
----------------------------------------------------------------------------
Other comprehensive loss (303) (201) (559) (220)
----------------------------------------------------------------------------
Comprehensive (loss) income (204) (151) 229 449
----------------------------------------------------------------------------
Attributable to:
----------------------------------------------------------------------------
Equity holders of Agrium (205) (151) 226 447
----------------------------------------------------------------------------
Non-controlling interest 1 - 3 2
----------------------------------------------------------------------------
Comprehensive (loss) income (204) (151) 229 449
----------------------------------------------------------------------------
See accompanying notes.

AGRIUM INC.
Consolidated Balance Sheets
(Millions of U.S. dollars)
(Unaudited)

September 30, December 31,
----------------------------------------------------------------------------
2015 2014 2014
----------------------------------------------------------------------------
Assets
----------------------------------------------------------------------------
Current assets
----------------------------------------------------------------------------
Cash and cash equivalents 753 274 848
----------------------------------------------------------------------------
Accounts receivable 2,927 2,847 2,075
----------------------------------------------------------------------------
Income taxes receivable 12 25 138
----------------------------------------------------------------------------
Inventories 2,759 3,086 3,505
----------------------------------------------------------------------------
Prepaid expenses and deposits 165 236 710
----------------------------------------------------------------------------
Other current assets 148 179 122
----------------------------------------------------------------------------
6,764 6,647 7,398
----------------------------------------------------------------------------
Property, plant and equipment
(note 7) 6,274 6,021 6,272
----------------------------------------------------------------------------
Intangibles 635 730 695
----------------------------------------------------------------------------
Goodwill 1,995 1,982 2,014
----------------------------------------------------------------------------
Investments in associates and
joint ventures 574 622 576
----------------------------------------------------------------------------
Other assets 65 90 78
----------------------------------------------------------------------------
Deferred income tax assets 55 79 75
----------------------------------------------------------------------------
16,362 16,171 17,108
----------------------------------------------------------------------------
Liabilities and shareholders'
equity
----------------------------------------------------------------------------
Current liabilities
----------------------------------------------------------------------------
Short-term debt (note 5) 1,782 1,855 1,527
----------------------------------------------------------------------------
Accounts payable 2,923 3,214 4,197
----------------------------------------------------------------------------
Income taxes payable 59 2 5
----------------------------------------------------------------------------
Current portion of long-term
debt 11 26 11
----------------------------------------------------------------------------
Current portion of other
provisions 82 106 113
----------------------------------------------------------------------------
4,857 5,203 5,853
----------------------------------------------------------------------------
Long-term debt (note 5) 4,517 3,069 3,559
----------------------------------------------------------------------------
Post-employment benefits 139 145 151
----------------------------------------------------------------------------
Other provisions 342 415 367
----------------------------------------------------------------------------
Other liabilities 81 40 69
----------------------------------------------------------------------------
Deferred income tax
liabilities 420 378 422
----------------------------------------------------------------------------
10,356 9,250 10,421
----------------------------------------------------------------------------
Shareholders' equity
----------------------------------------------------------------------------
Share capital 1,756 1,821 1,821
----------------------------------------------------------------------------
Retained earnings 5,444 5,575 5,502
----------------------------------------------------------------------------
Accumulated other
comprehensive loss (1,198) (477) (643)
----------------------------------------------------------------------------
Equity holders of Agrium 6,002 6,919 6,680
----------------------------------------------------------------------------
Non-controlling interest 4 2 7
----------------------------------------------------------------------------
Total equity 6,006 6,921 6,687
----------------------------------------------------------------------------
16,362 16,171 17,108
----------------------------------------------------------------------------
See accompanying notes.

AGRIUM INC.
Consolidated Statements of Cash Flows
(Millions of U.S. dollars)
(Unaudited)

Three months ended Nine months ended
September 30, September 30,
----------------------------------------------------------------------------
2015 2014 2015 2014
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Operating
----------------------------------------------------------------------------
Net earnings from continuing
operations 99 91 788 728
----------------------------------------------------------------------------
Adjustments for
----------------------------------------------------------------------------
Depreciation and amortization 115 143 345 412
----------------------------------------------------------------------------
Loss (earnings) from associates
and joint ventures 10 (7) 9 (21)
----------------------------------------------------------------------------
Share-based payments (15) 10 36 25
----------------------------------------------------------------------------
Unrealized (gain) loss on
derivative financial
instruments (6) (41) 7 (46)
----------------------------------------------------------------------------
Unrealized foreign exchange
(gain) loss (13) 67 (23) 48
----------------------------------------------------------------------------
Interest income (19) (31) (52) (61)
----------------------------------------------------------------------------
Finance costs 55 29 179 92
----------------------------------------------------------------------------
Income taxes 37 (15) 325 233
----------------------------------------------------------------------------
Other (3) (12) (22) 15
----------------------------------------------------------------------------
Interest received 21 31 54 62
----------------------------------------------------------------------------
Interest paid (71) (15) (161) (68)
----------------------------------------------------------------------------
Income taxes paid (92) (215) (81) (283)
----------------------------------------------------------------------------
Dividends from associates and
joint ventures - 41 2 48
----------------------------------------------------------------------------
Net changes in non-cash working
capital (344) (542) (836) (852)
----------------------------------------------------------------------------
Cash (used in) provided by operating
activities (226) (466) 570 332
----------------------------------------------------------------------------
Investing
----------------------------------------------------------------------------
Acquisitions, net of cash acquired (1) (129) (85) (147)
----------------------------------------------------------------------------
Proceeds from sale of discontinued
operations - 94 - 94
----------------------------------------------------------------------------
Capital expenditures (170) (515) (910) (1,517)
----------------------------------------------------------------------------
Capitalized borrowing costs (14) (30) (37) (83)
----------------------------------------------------------------------------
Purchase of investments (25) (32) (110) (97)
----------------------------------------------------------------------------
Proceeds from sale of investments 20 24 65 68
----------------------------------------------------------------------------
Proceeds from sale of property,
plant and equipment 23 - 77 -
----------------------------------------------------------------------------
Other (4) (12) 7 (15)
----------------------------------------------------------------------------
Net changes in non-cash working
capital (97) 59 (189) 120
----------------------------------------------------------------------------
Cash used in investing activities (268) (541) (1,182) (1,577)
----------------------------------------------------------------------------
Financing
----------------------------------------------------------------------------
Short-term debt 1,156 682 418 1,126
----------------------------------------------------------------------------
Long-term debt issued - 12 1,000 12
----------------------------------------------------------------------------
Transaction costs on long-term
debt - - (14) -
----------------------------------------------------------------------------
Repayment of long-term debt (2) (30) (17) (45)
----------------------------------------------------------------------------
Dividends paid (122) (107) (345) (323)
----------------------------------------------------------------------------
Shares issued - - 1 1
----------------------------------------------------------------------------
Shares repurchased (459) - (559) -
----------------------------------------------------------------------------
Cash provided by financing
activities 573 557 484 771
----------------------------------------------------------------------------
Effect of exchange rate changes on
cash and cash equivalents 27 (18) 33 (37)
----------------------------------------------------------------------------
Increase (decrease) in cash and cash
equivalents from continuing
operations 106 (468) (95) (511)
----------------------------------------------------------------------------
Cash and cash equivalents used in
discontinued operations - (17) - (16)
----------------------------------------------------------------------------
Cash and cash equivalents -
beginning of period 647 759 848 801
----------------------------------------------------------------------------
Cash and cash equivalents - end of
period 753 274 753 274
----------------------------------------------------------------------------
See accompanying notes.

AGRIUM INC.
Consolidated Statements of Shareholders' Equity
(Millions of U.S. dollars, except share data)
(Unaudited)




Millions of
common Share Retained
shares capital earnings
----------------------------------------------------------------------------
December 31, 2013 144 1,820 5,253
----------------------------------------------------------------------------
Net earnings - - 667
----------------------------------------------------------------------------
Other comprehensive
income (loss), net
of tax
----------------------------------------------------------------------------
Post-employment
benefits - - (14)
----------------------------------------------------------------------------
Other - - -
----------------------------------------------------------------------------
Comprehensive income
(loss), net of tax - - 653
----------------------------------------------------------------------------
Dividends - - (323)
----------------------------------------------------------------------------
Non-controlling
interest
transactions - - -
----------------------------------------------------------------------------
Share-based payment
transactions - 1 -
----------------------------------------------------------------------------
Impact of adopting
IFRS 9 at January 1,
2014 - - (8)
----------------------------------------------------------------------------
September 30, 2014 144 1,821 5,575
----------------------------------------------------------------------------

----------------------------------------------------------------------------
December 31, 2014 144 1,821 5,502
----------------------------------------------------------------------------
Net earnings - - 787
----------------------------------------------------------------------------
Other comprehensive
income (loss), net
of tax
----------------------------------------------------------------------------
Post-employment
benefits - - 1
----------------------------------------------------------------------------
Other - - -
----------------------------------------------------------------------------
Comprehensive income
(loss), net of tax - - 788
----------------------------------------------------------------------------
Dividends - - (357)
----------------------------------------------------------------------------
Non-controlling
interest
transactions - - -
----------------------------------------------------------------------------
Shares repurchased (6) (70) (489)
----------------------------------------------------------------------------
Share-based payment
transactions - 5 -
----------------------------------------------------------------------------
Reclassification of
cash flow hedges - - -
----------------------------------------------------------------------------
September 30, 2015 138 1,756 5,444
----------------------------------------------------------------------------
See accompanying notes.



Other comprehensive income (loss)
-----------------------------------------------------
Comprehensive Available
Cash loss of for sale Foreign
flow associates and financial currency
hedges joint ventures instruments translation Total
----------------------------------------------------------------------------
December 31, 2013 - (7) (8) (264) (279)
----------------------------------------------------------------------------
Net earnings - - - - -
----------------------------------------------------------------------------
Other comprehensive
income (loss), net
of tax
----------------------------------------------------------------------------
Post-employment
benefits - - - - -
----------------------------------------------------------------------------
Other (5) (2) - (199) (206)
----------------------------------------------------------------------------
Comprehensive income
(loss), net of tax (5) (2) - (199) (206)
----------------------------------------------------------------------------
Dividends - - - - -
----------------------------------------------------------------------------
Non-controlling
interest
transactions - - - - -
----------------------------------------------------------------------------
Share-based payment
transactions - - - - -
----------------------------------------------------------------------------
Impact of adopting
IFRS 9 at January 1,
2014 - - 8 - 8
----------------------------------------------------------------------------
September 30, 2014 (5) (9) - (463) (477)
----------------------------------------------------------------------------

----------------------------------------------------------------------------
December 31, 2014 (27) (11) - (605) (643)
----------------------------------------------------------------------------
Net earnings - - - - -
----------------------------------------------------------------------------
Other comprehensive
income (loss), net
of tax
----------------------------------------------------------------------------
Post-employment
benefits - - - - -
----------------------------------------------------------------------------
Other (22) (7) - (533) (562)
----------------------------------------------------------------------------
Comprehensive income
(loss), net of tax (22) (7) - (533) (562)
----------------------------------------------------------------------------
Dividends - - - - -
----------------------------------------------------------------------------
Non-controlling
interest
transactions - - - - -
----------------------------------------------------------------------------
Shares repurchased - - - - -
----------------------------------------------------------------------------
Share-based payment
transactions - - - - -
----------------------------------------------------------------------------
Reclassification of
cash flow hedges 7 - - - 7
----------------------------------------------------------------------------
September 30, 2015 (42) (18) - (1,138)(1,198)
----------------------------------------------------------------------------
See accompanying notes.






Equity Non-
holders of controlling Total
Agrium interest equity
----------------------------------------------------------------------------
December 31, 2013 6,794 2 6,796
----------------------------------------------------------------------------
Net earnings 667 2 669
----------------------------------------------------------------------------
Other comprehensive
income (loss), net
of tax
----------------------------------------------------------------------------
Post-employment
benefits (14) - (14)
----------------------------------------------------------------------------
Other (206) - (206)
----------------------------------------------------------------------------
Comprehensive income
(loss), net of tax 447 2 449
----------------------------------------------------------------------------
Dividends (323) - (323)
----------------------------------------------------------------------------
Non-controlling
interest
transactions - (2) (2)
----------------------------------------------------------------------------
Share-based payment
transactions 1 - 1
----------------------------------------------------------------------------
Impact of adopting
IFRS 9 at January 1,
2014 - - -
----------------------------------------------------------------------------
September 30, 2014 6,919 2 6,921
----------------------------------------------------------------------------

----------------------------------------------------------------------------
December 31, 2014 6,680 7 6,687
----------------------------------------------------------------------------
Net earnings 787 1 788
----------------------------------------------------------------------------
Other comprehensive
income (loss), net
of tax
----------------------------------------------------------------------------
Post-employment
benefits 1 - 1
----------------------------------------------------------------------------
Other (562) 2 (560)
----------------------------------------------------------------------------
Comprehensive income
(loss), net of tax 226 3 229
----------------------------------------------------------------------------
Dividends (357) - (357)
----------------------------------------------------------------------------
Non-controlling
interest
transactions - (6) (6)
----------------------------------------------------------------------------
Shares repurchased (559) - (559)
----------------------------------------------------------------------------
Share-based payment
transactions 5 - 5
----------------------------------------------------------------------------
Reclassification of
cash flow hedges 7 - 7
----------------------------------------------------------------------------
September 30, 2015 6,002 4 6,006
----------------------------------------------------------------------------
See accompanying notes.

AGRIUM INC.
Summarized Notes to the Consolidated Financial Statements
For the nine months ended September 30, 2015
(Millions of U.S. dollars, unless otherwise stated)
(Unaudited)



1. Corporate Information

Corporate information

Agrium Inc. ("Agrium") is incorporated under the laws of Canada with common shares listed under the symbol "AGU" on the New York Stock Exchange (NYSE) and the Toronto Stock Exchange (TSX). Our Corporate head office is located at 13131 Lake Fraser Drive S.E., Calgary, Canada. We conduct our operations globally from our Wholesale head office in Calgary and our Retail head office in Loveland, Colorado, United States. In these financial statements, "we", "us", "our" and "Agrium" mean Agrium Inc., its subsidiaries and joint arrangements.

Agrium operates two business units:



-- Retail: Distributes crop nutrients, crop protection products, seed,
merchandise and services directly to growers through a network of farm
centers in two geographical segments:
-- North America, including the United States and Canada; and
-- International, including Australia and South America.
-- Wholesale: Operates in North and South America and Europe producing,
marketing and distributing crop nutrients and industrial products
through the following businesses:
-- Nitrogen: Manufacturing in Alberta, Texas and Argentina;
-- Potash: Mining and processing in Saskatchewan;
-- Phosphate: Mining and production facilities in Alberta and Idaho;
and
-- Other: Marketing nutrient-based products from other suppliers in
North and South America and Europe, and producing blended crop
nutrients and ESNr (Environmentally Smart Nitrogen) polymer-coated
nitrogen crop nutrients.



Additional information on our operating segments is included in note 2.

Seasonality in our business results from increased demand for our products during planting seasons. Sales are generally higher in spring and fall.

Basis of preparation and statement of compliance

These consolidated interim financial statements ("interim financial statements") were approved for issuance by the Audit Committee on November 4, 2015. We prepared these interim financial statements in accordance with International Accounting Standard 34 Interim Financial Reporting. These statements do not include all information and disclosures normally provided in annual financial statements and should be read in conjunction with our audited annual financial statements and related notes contained in our 2014 Annual Report, available at www.agrium.com.

The accounting policies applied in these interim financial statements are the same as those applied in our audited annual financial statements in our 2014 Annual Report, with the exception of the accounting changes described in note 9 to our interim financial statements for the three months ended March 31, 2015.

2. Operating Segments



Segment information by business unit
Three months ended September 30,
----------------------------------------------------------------------------
2015
----------------------------------------------------------------------------
Retail Wholesale Other (1) Total
----------------------------------------------------------------------------
Sales - external 2,006 518 - 2,524
----------------------------------------------------------------------------
- inter-segment 5 155 (160) -
----------------------------------------------------------------------------
Total sales 2,011 673 (160) 2,524
----------------------------------------------------------------------------
Cost of product sold 1,517 455 (144) 1,828
----------------------------------------------------------------------------
Gross profit 494 218 (16) 696
----------------------------------------------------------------------------
Gross profit (%) 25 32 28
----------------------------------------------------------------------------
Expenses
----------------------------------------------------------------------------
Selling 437 9 (5) 441
----------------------------------------------------------------------------
General and administrative 25 11 25 61
----------------------------------------------------------------------------
Share-based payments - - (15) (15)
----------------------------------------------------------------------------
Loss (earnings) from associates
and joint ventures 1 9 - 10
----------------------------------------------------------------------------
Other (income) expenses (33) 15 26 8
----------------------------------------------------------------------------
Earnings (loss) before finance costs
and income taxes 64 174 (47) 191
----------------------------------------------------------------------------
Finance costs - - 55 55
----------------------------------------------------------------------------
Earnings (loss) before income taxes 64 174 (102) 136
----------------------------------------------------------------------------
Depreciation and amortization 65 47 3 115
----------------------------------------------------------------------------
Finance costs - - 55 55
----------------------------------------------------------------------------
EBITDA (2) 129 221 (44) 306
----------------------------------------------------------------------------
Share of joint ventures
----------------------------------------------------------------------------
Finance costs and income taxes - 1 - 1
----------------------------------------------------------------------------
Depreciation and amortization - 4 - 4
----------------------------------------------------------------------------
Adjusted EBITDA 129 226 (44) 311
----------------------------------------------------------------------------

Segment information by business unit
Three months ended September 30,
----------------------------------------------------------------------------
2014
----------------------------------------------------------------------------
Retail Wholesale Other (1) Total
----------------------------------------------------------------------------
Sales - external 2,294 626 - 2,920
----------------------------------------------------------------------------
- inter-segment 1 177 (178) -
----------------------------------------------------------------------------
Total sales 2,295 803 (178) 2,920
----------------------------------------------------------------------------
Cost of product sold 1,753 676 (174) 2,255
----------------------------------------------------------------------------
Gross profit 542 127 (4) 665
----------------------------------------------------------------------------
Gross profit (%) 24 16 23
----------------------------------------------------------------------------
Expenses
----------------------------------------------------------------------------
Selling 470 13 (3) 480
----------------------------------------------------------------------------
General and administrative 31 10 29 70
----------------------------------------------------------------------------
Share-based payments - - 10 10
----------------------------------------------------------------------------
Loss (earnings) from associates
and joint ventures (2) (7) 2 (7)
----------------------------------------------------------------------------
Other (income) expenses (8) 11 4 7
----------------------------------------------------------------------------
Earnings (loss) before finance costs
and income taxes 51 100 (46) 105
----------------------------------------------------------------------------
Finance costs - - 29 29
----------------------------------------------------------------------------
Earnings (loss) before income taxes 51 100 (75) 76
----------------------------------------------------------------------------
Depreciation and amortization 79 58 6 143
----------------------------------------------------------------------------
Finance costs - - 29 29
----------------------------------------------------------------------------
EBITDA (2) 130 158 (40) 248
----------------------------------------------------------------------------
Share of joint ventures
----------------------------------------------------------------------------
Finance costs and income taxes - 8 - 8
----------------------------------------------------------------------------
Depreciation and amortization - 5 - 5
----------------------------------------------------------------------------
Adjusted EBITDA 130 171 (40) 261
----------------------------------------------------------------------------
(1) Includes inter-segment eliminations.
(2) EBITDA is earnings (loss) from continuing operations before finance
costs, income taxes, depreciation and amortization.

Segment information by business unit
Nine months ended September 30,
----------------------------------------------------------------------------
2015
----------------------------------------------------------------------------
Retail Wholesale Other (1) Total
----------------------------------------------------------------------------
Sales - external 10,410 1,978 - 12,388
----------------------------------------------------------------------------
- inter-segment 24 736 (760) -
----------------------------------------------------------------------------
Total sales 10,434 2,714 (760) 12,388
----------------------------------------------------------------------------
Cost of product sold 8,305 1,853 (758) 9,400
----------------------------------------------------------------------------
Gross profit 2,129 861 (2) 2,988
----------------------------------------------------------------------------
Gross profit (%) 20 32 24
----------------------------------------------------------------------------
Expenses
----------------------------------------------------------------------------
Selling 1,440 29 (13) 1,456
----------------------------------------------------------------------------
General and administrative 83 27 84 194
----------------------------------------------------------------------------
Share-based payments - - 36 36
----------------------------------------------------------------------------
(Earnings) loss from associates
and joint ventures (3) 12 - 9
----------------------------------------------------------------------------
Other (income) expenses (37) 7 31 1
----------------------------------------------------------------------------
Earnings (loss) before finance costs
and income taxes 646 786 (140) 1,292
----------------------------------------------------------------------------
Finance costs - - 179 179
----------------------------------------------------------------------------
Earnings (loss) before income taxes 646 786 (319) 1,113
----------------------------------------------------------------------------
Depreciation and amortization 188 146 11 345
----------------------------------------------------------------------------
Finance costs - - 179 179
----------------------------------------------------------------------------
EBITDA 834 932 (129) 1,637
----------------------------------------------------------------------------
Share of joint ventures
----------------------------------------------------------------------------
Finance costs and income taxes - 6 - 6
----------------------------------------------------------------------------
Depreciation and amortization - 12 - 12
----------------------------------------------------------------------------
Adjusted EBITDA 834 950 (129) 1,655
----------------------------------------------------------------------------

Segment information by business unit
Nine months ended September 30,
----------------------------------------------------------------------------
2014
----------------------------------------------------------------------------
Retail Wholesale Other (1) Total
----------------------------------------------------------------------------
Sales - external 10,913 2,424 - 13,337
----------------------------------------------------------------------------
- inter-segment 11 652 (663) -
----------------------------------------------------------------------------
Total sales 10,924 3,076 (663) 13,337
----------------------------------------------------------------------------
Cost of product sold 8,646 2,551 (680) 10,517
----------------------------------------------------------------------------
Gross profit 2,278 525 17 2,820
----------------------------------------------------------------------------
Gross profit (%) 21 17 21
----------------------------------------------------------------------------
Expenses
----------------------------------------------------------------------------
Selling 1,509 34 (10) 1,533
----------------------------------------------------------------------------
General and administrative 94 33 94 221
----------------------------------------------------------------------------
Share-based payments - - 25 25
----------------------------------------------------------------------------
(Earnings) loss from associates
and joint ventures (7) (17) 3 (21)
----------------------------------------------------------------------------
Other (income) expenses (28) 6 31 9
----------------------------------------------------------------------------
Earnings (loss) before finance costs
and income taxes 710 469 (126) 1,053
----------------------------------------------------------------------------
Finance costs - - 92 92
----------------------------------------------------------------------------
Earnings (loss) before income taxes 710 469 (218) 961
----------------------------------------------------------------------------
Depreciation and amortization 228 172 12 412
----------------------------------------------------------------------------
Finance costs - - 92 92
----------------------------------------------------------------------------
EBITDA 938 641 (114) 1,465
----------------------------------------------------------------------------
Share of joint ventures
----------------------------------------------------------------------------
Finance costs and income taxes - 20 - 20
----------------------------------------------------------------------------
Depreciation and amortization - 10 - 10
----------------------------------------------------------------------------
Adjusted EBITDA 938 671 (114) 1,495
----------------------------------------------------------------------------
(1) Includes inter-segment eliminations.

Segment information - Retail
Three months ended September 30,
----------------------------------------------------------------------------
2015
----------------------------------------------------------------------------
North
America International Retail
----------------------------------------------------------------------------
Sales - external 1,582 424 2,006
----------------------------------------------------------------------------
- inter-segment 5 - 5
----------------------------------------------------------------------------
Total sales 1,587 424 2,011
----------------------------------------------------------------------------
Cost of product sold 1,184 333 1,517
----------------------------------------------------------------------------
Gross profit 403 91 494
----------------------------------------------------------------------------
Expenses
----------------------------------------------------------------------------
Selling 362 75 437
----------------------------------------------------------------------------
General and administrative 17 8 25
----------------------------------------------------------------------------
Loss (earnings) from
associates and joint
ventures 1 - 1
----------------------------------------------------------------------------
Other (income) expenses (30) (3) (33)
----------------------------------------------------------------------------
Earnings before income taxes 53 11 64
----------------------------------------------------------------------------
Depreciation and amortization 59 6 65
----------------------------------------------------------------------------
EBITDA 112 17 129
----------------------------------------------------------------------------
Adjusted EBITDA 112 17 129
----------------------------------------------------------------------------


Segment information - Retail
Three months ended September 30,
----------------------------------------------------------------------------
2014
----------------------------------------------------------------------------
North
America International Retail
----------------------------------------------------------------------------
Sales - external 1,743 551 2,294
----------------------------------------------------------------------------
- inter-segment 1 - 1
----------------------------------------------------------------------------
Total sales 1,744 551 2,295
----------------------------------------------------------------------------
Cost of product sold 1,321 432 1,753
----------------------------------------------------------------------------
Gross profit 423 119 542
----------------------------------------------------------------------------
Expenses
----------------------------------------------------------------------------
Selling 374 96 470
----------------------------------------------------------------------------
General and administrative 20 11 31
----------------------------------------------------------------------------
Loss (earnings) from
associates and joint
ventures (1) (1) (2)
----------------------------------------------------------------------------
Other (income) expenses (11) 3 (8)
----------------------------------------------------------------------------
Earnings before income taxes 41 10 51
----------------------------------------------------------------------------
Depreciation and amortization 71 8 79
----------------------------------------------------------------------------
EBITDA 112 18 130
----------------------------------------------------------------------------
Adjusted EBITDA 112 18 130
----------------------------------------------------------------------------

Segment information - Retail
Nine months ended September 30,
----------------------------------------------------------------------------
2015
----------------------------------------------------------------------------
North
America International Retail
----------------------------------------------------------------------------
Sales - external 8,760 1,650 10,410
----------------------------------------------------------------------------
- inter-segment 24 - 24
----------------------------------------------------------------------------
Total sales 8,784 1,650 10,434
----------------------------------------------------------------------------
Cost of product sold 6,973 1,332 8,305
----------------------------------------------------------------------------
Gross profit 1,811 318 2,129
----------------------------------------------------------------------------
Expenses
----------------------------------------------------------------------------
Selling 1,196 244 1,440
----------------------------------------------------------------------------
General and administrative 57 26 83
----------------------------------------------------------------------------
Earnings from associates and
joint ventures (2) (1) (3)
----------------------------------------------------------------------------
Other income (18) (19) (37)
----------------------------------------------------------------------------
Earnings before income taxes 578 68 646
----------------------------------------------------------------------------
Depreciation and amortization 168 20 188
----------------------------------------------------------------------------
EBITDA 746 88 834
----------------------------------------------------------------------------
Adjusted EBITDA 746 88 834
----------------------------------------------------------------------------


Segment information - Retail
Nine months ended September 30,
----------------------------------------------------------------------------
2014
----------------------------------------------------------------------------
North
America International Retail
----------------------------------------------------------------------------
Sales - external 8,967 1,946 10,913
----------------------------------------------------------------------------
- inter-segment 11 - 11
----------------------------------------------------------------------------
Total sales 8,978 1,946 10,924
----------------------------------------------------------------------------
Cost of product sold 7,072 1,574 8,646
----------------------------------------------------------------------------
Gross profit 1,906 372 2,278
----------------------------------------------------------------------------
Expenses
----------------------------------------------------------------------------
Selling 1,225 284 1,509
----------------------------------------------------------------------------
General and administrative 60 34 94
----------------------------------------------------------------------------
Earnings from associates and
joint ventures (4) (3) (7)
----------------------------------------------------------------------------
Other income (7) (21) (28)
----------------------------------------------------------------------------
Earnings before income taxes 632 78 710
----------------------------------------------------------------------------
Depreciation and amortization 203 25 228
----------------------------------------------------------------------------
EBITDA 835 103 938
----------------------------------------------------------------------------
Adjusted EBITDA 835 103 938
----------------------------------------------------------------------------

Segment information - Wholesale
Three months ended September 30,
----------------------------------------------------------------------------
2015
----------------------------------------------------------------------------
Wholesale
Nitrogen Potash Phosphate Other (1) Wholesale
----------------------------------------------------------------------------
Sales - external 226 90 116 86 518
----------------------------------------------------------------------------
- inter-segment 69 17 53 16 155
----------------------------------------------------------------------------
Total sales 295 107 169 102 673
----------------------------------------------------------------------------
Cost of product sold 165 65 138 87 455
----------------------------------------------------------------------------
Gross profit 130 42 31 15 218
----------------------------------------------------------------------------
Expenses
----------------------------------------------------------------------------
Selling 4 1 1 3 9
----------------------------------------------------------------------------
General and administrative 5 2 1 3 11
----------------------------------------------------------------------------
Loss (earnings) from
associates and joint
ventures - - - 9 9
----------------------------------------------------------------------------
Other expenses (income) 6 7 3 (1) 15
----------------------------------------------------------------------------
Earnings (loss) before
income taxes 115 32 26 1 174
----------------------------------------------------------------------------
Depreciation and
amortization 16 16 13 2 47
----------------------------------------------------------------------------
EBITDA 131 48 39 3 221
----------------------------------------------------------------------------
Share of joint ventures
----------------------------------------------------------------------------
Finance costs and income
taxes 1 - - - 1
----------------------------------------------------------------------------
Depreciation and
amortization 4 - - - 4
----------------------------------------------------------------------------
Adjusted EBITDA 136 48 39 3 226
----------------------------------------------------------------------------

Segment information - Wholesale
Three months ended September 30,
----------------------------------------------------------------------------
2014
----------------------------------------------------------------------------
Wholesale
Nitrogen Potash Phosphate Other (1) Wholesale
----------------------------------------------------------------------------
Sales - external 257 61 99 209 626
----------------------------------------------------------------------------
- inter-segment 64 18 74 21 177
----------------------------------------------------------------------------
Total sales 321 79 173 230 803
----------------------------------------------------------------------------
Cost of product sold 244 77 142 213 676
----------------------------------------------------------------------------
Gross profit 77 2 31 17 127
----------------------------------------------------------------------------
Expenses
----------------------------------------------------------------------------
Selling 5 2 2 4 13
----------------------------------------------------------------------------
General and administrative 3 2 2 3 10
----------------------------------------------------------------------------
Loss (earnings) from
associates and joint
ventures - - - (7) (7)
----------------------------------------------------------------------------
Other expenses (income) 6 4 1 - 11
----------------------------------------------------------------------------
Earnings (loss) before
income taxes 63 (6) 26 17 100
----------------------------------------------------------------------------
Depreciation and
amortization 23 19 12 4 58
----------------------------------------------------------------------------
EBITDA 86 13 38 21 158
----------------------------------------------------------------------------
Share of joint ventures
----------------------------------------------------------------------------
Finance costs and income
taxes 7 - - 1 8
----------------------------------------------------------------------------
Depreciation and
amortization 5 - - - 5
----------------------------------------------------------------------------
Adjusted EBITDA 98 13 38 22 171
----------------------------------------------------------------------------
(1) Includes product purchased for resale, ammonium sulfate, ESN and other
products.

Segment information - Wholesale
Nine months ended September 30,
----------------------------------------------------------------------------
2015
----------------------------------------------------------------------------
Wholesale
Nitrogen Potash Phosphate Other (1) Wholesale
----------------------------------------------------------------------------
Sales - external 859 227 344 548 1,978
----------------------------------------------------------------------------
- inter-segment 304 113 198 121 736
----------------------------------------------------------------------------
Total sales 1,163 340 542 669 2,714
----------------------------------------------------------------------------
Cost of product sold 620 223 437 573 1,853
----------------------------------------------------------------------------
Gross profit 543 117 105 96 861
----------------------------------------------------------------------------
Expenses
----------------------------------------------------------------------------
Selling 12 4 3 10 29
----------------------------------------------------------------------------
General and administrative 10 5 4 8 27
----------------------------------------------------------------------------
Loss (earnings) from
associates and joint
ventures - - - 12 12
----------------------------------------------------------------------------
Other expenses (income) 12 18 16 (39) 7
----------------------------------------------------------------------------
Earnings before income taxes 509 90 82 105 786
----------------------------------------------------------------------------
Depreciation and
amortization 54 43 37 12 146
----------------------------------------------------------------------------
EBITDA 563 133 119 117 932
----------------------------------------------------------------------------
Share of joint ventures
----------------------------------------------------------------------------
Finance costs and income
taxes 6 - - - 6
----------------------------------------------------------------------------
Depreciation and
amortization 12 - - - 12
----------------------------------------------------------------------------
Adjusted EBITDA 581 133 119 117 950
----------------------------------------------------------------------------

Segment information - Wholesale
Nine months ended September 30,
----------------------------------------------------------------------------
2014
----------------------------------------------------------------------------
Wholesale
Nitrogen Potash Phosphate Other (1) Wholesale
----------------------------------------------------------------------------
Sales - external 813 267 321 1,023 2,424
----------------------------------------------------------------------------
- inter-segment 265 115 180 92 652
----------------------------------------------------------------------------
Total sales 1,078 382 501 1,115 3,076
----------------------------------------------------------------------------
Cost of product sold 810 262 462 1,017 2,551
----------------------------------------------------------------------------
Gross profit 268 120 39 98 525
----------------------------------------------------------------------------
Expenses
----------------------------------------------------------------------------
Selling 11 6 5 12 34
----------------------------------------------------------------------------
General and administrative 9 7 7 10 33
----------------------------------------------------------------------------
Loss (earnings) from
associates and joint
ventures - - - (17) (17)
----------------------------------------------------------------------------
Other expenses (income) (18) 15 10 (1) 6
----------------------------------------------------------------------------
Earnings before income taxes 266 92 17 94 469
----------------------------------------------------------------------------
Depreciation and
amortization 65 50 38 19 172
----------------------------------------------------------------------------
EBITDA 331 142 55 113 641
----------------------------------------------------------------------------
Share of joint ventures
----------------------------------------------------------------------------
Finance costs and income
taxes 19 - - 1 20
----------------------------------------------------------------------------
Depreciation and
amortization 10 - - - 10
----------------------------------------------------------------------------
Adjusted EBITDA 360 142 55 114 671
----------------------------------------------------------------------------
(1) Includes product purchased for resale, ammonium sulfate, ESN and other
products.

Gross profit by product line
Three months ended September 30,
----------------------------------------------------------------------------
2015 2014
----------------------------------------------------------------------------
Cost of Cost of
product Gross product Gross
Sales sold profit Sales sold profit
----------------------------------------------------------------------------
Retail
----------------------------------------------------------------------------
Crop nutrients 582 469 113 646 504 142
----------------------------------------------------------------------------
Crop protection products 1,040 806 234 1,132 900 232
----------------------------------------------------------------------------
Seed 60 34 26 54 27 27
----------------------------------------------------------------------------
Merchandise 166 141 25 256 220 36
----------------------------------------------------------------------------
Services and other 163 67 96 207 102 105
----------------------------------------------------------------------------
2,011 1,517 494 2,295 1,753 542
----------------------------------------------------------------------------
Wholesale
----------------------------------------------------------------------------
Nitrogen 295 165 130 321 244 77
----------------------------------------------------------------------------
Potash 107 65 42 79 77 2
----------------------------------------------------------------------------
Phosphate 169 138 31 173 142 31
----------------------------------------------------------------------------
Product purchased for
resale 49 47 2 165 159 6
----------------------------------------------------------------------------
Ammonium sulfate, ESN and
other 53 40 13 65 54 11
----------------------------------------------------------------------------
673 455 218 803 676 127
----------------------------------------------------------------------------
Other inter-segment
eliminations (160) (144) (16) (178) (174) (4)
----------------------------------------------------------------------------
Total 2,524 1,828 696 2,920 2,255 665
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Wholesale share of joint
ventures
----------------------------------------------------------------------------
Nitrogen 57 58 (1) 73 56 17
----------------------------------------------------------------------------
Product purchased for
resale - - - 24 20 4
----------------------------------------------------------------------------
57 58 (1) 97 76 21
----------------------------------------------------------------------------
Total Wholesale including
proportionate share in
joint ventures 730 513 217 900 752 148
----------------------------------------------------------------------------


Gross profit by product line
Nine months ended September 30,
----------------------------------------------------------------------------
2015 2014
----------------------------------------------------------------------------
Cost of Cost of
product Gross product Gross
Sales sold profit Sales sold profit
----------------------------------------------------------------------------
Retail
----------------------------------------------------------------------------
Crop nutrients 4,101 3,408 693 4,250 3,475 775
----------------------------------------------------------------------------
Crop protection products 4,002 3,203 799 4,061 3,267 794
----------------------------------------------------------------------------
Seed 1,350 1,120 230 1,390 1,121 269
----------------------------------------------------------------------------
Merchandise 482 410 72 660 576 84
----------------------------------------------------------------------------
Services and other 499 164 335 563 207 356
----------------------------------------------------------------------------
10,434 8,305 2,129 10,924 8,646 2,278
----------------------------------------------------------------------------
Wholesale
----------------------------------------------------------------------------
Nitrogen 1,163 620 543 1,078 810 268
----------------------------------------------------------------------------
Potash 340 223 117 382 262 120
----------------------------------------------------------------------------
Phosphate 542 437 105 501 462 39
----------------------------------------------------------------------------
Product purchased for
resale 345 335 10 744 722 22
----------------------------------------------------------------------------
Ammonium sulfate, ESN and
other 324 238 86 371 295 76
----------------------------------------------------------------------------
2,714 1,853 861 3,076 2,551 525
----------------------------------------------------------------------------
Other inter-segment
eliminations (760) (758) (2) (663) (680) 17
----------------------------------------------------------------------------
Total 12,388 9,400 2,988 13,337 10,517 2,820
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Wholesale share of joint
ventures
----------------------------------------------------------------------------
Nitrogen 123 119 4 149 109 40
----------------------------------------------------------------------------
Product purchased for
resale 38 37 1 62 56 6
----------------------------------------------------------------------------
161 156 5 211 165 46
----------------------------------------------------------------------------
Total Wholesale including
proportionate share in
joint ventures 2,875 2,009 866 3,287 2,716 571
----------------------------------------------------------------------------

Selected volumes and per tonne information
Three months ended September 30,
----------------------------------------------------------------------------
2015
----------------------------------------------------------------------------
Cost of
Sales Selling product
tonnes price sold Margin
(000's) ($/tonne) ($/tonne) ($/tonne)
----------------------------------------------------------------------------
Retail
----------------------------------------------------------------------------
Crop nutrients
----------------------------------------------------------------------------
North America 777 557 429 128
----------------------------------------------------------------------------
International 342 437 395 42
----------------------------------------------------------------------------
Total crop nutrients 1,119 520 418 102
----------------------------------------------------------------------------

Wholesale
----------------------------------------------------------------------------
Nitrogen
----------------------------------------------------------------------------
North America
----------------------------------------------------------------------------
Ammonia 219 476
----------------------------------------------------------------------------
Urea 378 380
----------------------------------------------------------------------------
Other 163 289
----------------------------------------------------------------------------
Total nitrogen 760 388 217 171
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Potash
----------------------------------------------------------------------------
North America 147 341
----------------------------------------------------------------------------
International 237 241
----------------------------------------------------------------------------
Total potash 384 279 171 108
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Phosphate 269 629 514 115
----------------------------------------------------------------------------
Product purchased for resale 111 444 424 20
----------------------------------------------------------------------------
Ammonium sulfate 62 296 134 162
----------------------------------------------------------------------------
ESN and other 81
----------------------------------------------------------------------------
Total Wholesale 1,667 404 273 131
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Wholesale share of joint ventures
----------------------------------------------------------------------------
Nitrogen 142 401 413 (12)
----------------------------------------------------------------------------
Product purchased for resale - - - -
----------------------------------------------------------------------------
142 401 413 (12)
----------------------------------------------------------------------------
Total Wholesale including
proportionate share in joint
ventures 1,809 404 284 120
----------------------------------------------------------------------------


Selected volumes and per tonne information
Three months ended September 30,
----------------------------------------------------------------------------
2014
----------------------------------------------------------------------------
Cost of
Sales Selling product
tonnes price sold Margin
(000's) ($/tonne) ($/tonne) ($/tonne)
----------------------------------------------------------------------------
Retail
----------------------------------------------------------------------------
Crop nutrients
----------------------------------------------------------------------------
North America 785 571 420 151
----------------------------------------------------------------------------
International 386 511 453 58
----------------------------------------------------------------------------
Total crop nutrients 1,171 551 431 120
----------------------------------------------------------------------------

Wholesale
----------------------------------------------------------------------------
Nitrogen
----------------------------------------------------------------------------
North America
----------------------------------------------------------------------------
Ammonia 207 544
----------------------------------------------------------------------------
Urea 320 436
----------------------------------------------------------------------------
Other 208 335
----------------------------------------------------------------------------
Total nitrogen 735 438 333 105
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Potash
----------------------------------------------------------------------------
North America 138 395
----------------------------------------------------------------------------
International 113 212
----------------------------------------------------------------------------
Total potash 251 313 304 9
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Phosphate 261 663 546 117
----------------------------------------------------------------------------
Product purchased for resale 455 361 349 12
----------------------------------------------------------------------------
Ammonium sulfate 67 330 203 127
----------------------------------------------------------------------------
ESN and other 87
----------------------------------------------------------------------------
Total Wholesale 1,856 433 365 68
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Wholesale share of joint ventures
----------------------------------------------------------------------------
Nitrogen 165 440 339 101
----------------------------------------------------------------------------
Product purchased for resale 73 329 269 60
----------------------------------------------------------------------------
238 406 317 89
----------------------------------------------------------------------------
Total Wholesale including
proportionate share in joint
ventures 2,094 429 358 71
----------------------------------------------------------------------------

Selected volumes and per tonne information
Nine months ended September 30,
----------------------------------------------------------------------------
2015
----------------------------------------------------------------------------
Cost of
Sales Selling product
tonnes price sold Margin
(000's) ($/tonne) ($/tonne) ($/tonne)
----------------------------------------------------------------------------
Retail
----------------------------------------------------------------------------
Crop nutrients
----------------------------------------------------------------------------
North America 6,356 542 441 101
----------------------------------------------------------------------------
International 1,516 432 399 33
----------------------------------------------------------------------------
Total crop nutrients 7,872 521 433 88
----------------------------------------------------------------------------

Wholesale
----------------------------------------------------------------------------
Nitrogen
----------------------------------------------------------------------------
North America
----------------------------------------------------------------------------
Ammonia 835 544
----------------------------------------------------------------------------
Urea 1,197 407
----------------------------------------------------------------------------
Other 712 310
----------------------------------------------------------------------------
Total nitrogen 2,744 424 226 198
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Potash
----------------------------------------------------------------------------
North America 630 369
----------------------------------------------------------------------------
International 448 240
----------------------------------------------------------------------------
Total potash 1,078 316 208 108
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Phosphate 841 645 520 125
----------------------------------------------------------------------------
Product purchased for resale 941 366 356 10
----------------------------------------------------------------------------
Ammonium sulfate 240 345 146 199
----------------------------------------------------------------------------
ESN and other 501
----------------------------------------------------------------------------
Total Wholesale 6,345 428 292 136
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Wholesale share of joint ventures
----------------------------------------------------------------------------
Nitrogen 308 400 388 12
----------------------------------------------------------------------------
Product purchased for resale 117 321 309 12
----------------------------------------------------------------------------
425 378 366 12
----------------------------------------------------------------------------
Total Wholesale including
proportionate share in joint
ventures 6,770 425 297 128
----------------------------------------------------------------------------

Selected volumes and per tonne information
Nine months ended September 30,
----------------------------------------------------------------------------
2014
----------------------------------------------------------------------------
Cost of
Sales Selling product
tonnes price sold Margin
(000's) ($/tonne) ($/tonne) ($/tonne)
----------------------------------------------------------------------------
Retail
----------------------------------------------------------------------------
Crop nutrients
----------------------------------------------------------------------------
North America 6,346 547 435 112
----------------------------------------------------------------------------
International 1,570 496 454 42
----------------------------------------------------------------------------
Total crop nutrients 7,916 537 439 98
----------------------------------------------------------------------------

Wholesale
----------------------------------------------------------------------------
Nitrogen
----------------------------------------------------------------------------
North America
----------------------------------------------------------------------------
Ammonia 709 547
----------------------------------------------------------------------------
Urea 945 448
----------------------------------------------------------------------------
Other 779 343
----------------------------------------------------------------------------
Total nitrogen 2,433 443 333 110
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Potash
----------------------------------------------------------------------------
North America 802 359
----------------------------------------------------------------------------
International 443 212
----------------------------------------------------------------------------
Total potash 1,245 307 210 97
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Phosphate 837 599 553 46
----------------------------------------------------------------------------
Product purchased for resale 1,943 383 372 11
----------------------------------------------------------------------------
Ammonium sulfate 265 334 179 155
----------------------------------------------------------------------------
ESN and other 549
----------------------------------------------------------------------------
Total Wholesale 7,272 423 351 72
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Wholesale share of joint ventures
----------------------------------------------------------------------------
Nitrogen 351 424 311 113
----------------------------------------------------------------------------
Product purchased for resale 225 275 246 29
----------------------------------------------------------------------------
576 366 286 80
----------------------------------------------------------------------------
Total Wholesale including
proportionate share in joint
ventures 7,848 419 346 73
----------------------------------------------------------------------------



3. Expenses



Three months ended Nine months ended
Other expenses September 30, September 30,
----------------------------------------------------------------------------
2015 2014 2015 2014
----------------------------------------------------------------------------
Loss (gain) on derivatives not
designated as hedges, net of
foreign exchange 13 21 13 (16)
----------------------------------------------------------------------------
Interest income (19) (31) (52) (61)
----------------------------------------------------------------------------
Gain on sale of purchase for resale
assets - - (38) -
----------------------------------------------------------------------------
Environmental remediation and asset
retirement obligations 6 1 15 21
----------------------------------------------------------------------------
Bad debt (recovery) expense (4) - 28 30
----------------------------------------------------------------------------
Potash profit and capital tax 3 3 13 9
----------------------------------------------------------------------------
Other 9 13 22 26
----------------------------------------------------------------------------
8 7 1 9
----------------------------------------------------------------------------



4. Earnings per Share



Attributable to equity holders of Three months ended Nine months ended
Agrium September 30, September 30,
----------------------------------------------------------------------------
2015 2014 2015 2014
----------------------------------------------------------------------------
Numerator
----------------------------------------------------------------------------
Net earnings from continuing
operations 101 91 787 726
----------------------------------------------------------------------------
Net loss from discontinued
operations - (41) - (59)
----------------------------------------------------------------------------
Net earnings 101 50 787 667
----------------------------------------------------------------------------
Denominator (millions)
----------------------------------------------------------------------------
Weighted average number of shares
outstanding for basic and diluted
earnings per share 141 144 143 144
----------------------------------------------------------------------------



5. Debt



September 30, December 31,
----------------------------------------------------------------------------
2015 2014
----------------------------------------------------------------------------
Maturity Rate (%) (1)
----------------------------------------------------------------------------
Short-term debt
----------------------------------------------------------------------------
Commercial paper 2015 - 2016 0.65 1,657 1,117
----------------------------------------------------------------------------
Credit facilities 5.53 125 410
----------------------------------------------------------------------------
1,782 1,527
----------------------------------------------------------------------------
(1) Weighted average rates at September 30, 2015.

Debentures issued during the three months
ended March 31, 2015
----------------------------------------------------------------------------
Maturity Rate (%) Principal
----------------------------------------------------------------------------
March 15, 2025 3.375 550
----------------------------------------------------------------------------
March 15, 2035 4.125 450
----------------------------------------------------------------------------



6. Financial Instruments

Commodity price risk

Natural gas derivative financial instruments outstanding (notional amounts in millions of MMBtu)



September 30,
----------------------------------------------------------------------------
2015
----------------------------------------------------------------------------
Average Fair value
contract of assets
Notional Maturities price (1) (liabilities)
----------------------------------------------------------------------------
Not designated as hedges
----------------------------------------------------------------------------
NYMEX swaps - - - -
----------------------------------------------------------------------------
AECO swaps - - - -
----------------------------------------------------------------------------
-
----------------------------------------------------------------------------
Designated as hedges
----------------------------------------------------------------------------
AECO swaps 86 2015 - 2018 2.81 (50)
----------------------------------------------------------------------------
(50)
----------------------------------------------------------------------------

December 31,
----------------------------------------------------------------------------
2014
----------------------------------------------------------------------------
Average Fair value
contract of assets
Notional Maturities price (1) (liabilities)
----------------------------------------------------------------------------
Not designated as hedges
----------------------------------------------------------------------------
NYMEX swaps 1 2015 3.83 (1)
----------------------------------------------------------------------------
AECO swaps 10 2015 3.40 (10)
----------------------------------------------------------------------------
(11)
----------------------------------------------------------------------------
Designated as hedges
----------------------------------------------------------------------------
AECO swaps 69 2015 - 2018 3.32 (25)
----------------------------------------------------------------------------
(25)
----------------------------------------------------------------------------
(1) U.S. dollars per MMBtu.

Fair value of assets (liabilities)
----------------------------------------
Maturities of natural gas derivative
contracts 2015 2016 2017 2018
----------------------------------------------------------------------------
Designated as hedges (4) (18) (15) (13)
----------------------------------------------------------------------------

Impact of change in fair value of natural gas
derivative financial instruments September 30, December 31,
----------------------------------------------------------------------------
2015 2014
----------------------------------------------------------------------------
A $10-million impact to net earnings requires
movement in gas prices per MMBtu - 1.23
----------------------------------------------------------------------------
A $10-million impact to other comprehensive
income requires movement in gas prices per
MMBtu 1.72 0.19
----------------------------------------------------------------------------


Use of derivatives to hedge exposure to natural gas market price risk
----------------------------------------------------------------------------
Term (gas year - 12 months ending
October 31) 2015 2016 2017 2018
----------------------------------------------------------------------------
Maximum allowable (% of forecasted
gas requirements) 75 75 75 25 (1)
----------------------------------------------------------------------------
Forecasted average monthly natural
gas consumption (millions of MMBtu) 8 9 9 9
----------------------------------------------------------------------------
Gas requirements hedged using
derivatives designated as hedges
(%) 56 25 25 17
----------------------------------------------------------------------------
(1) Maximum monthly hedged volume may not exceed 90 percent of planned
monthly requirements.



For our natural gas derivatives designated in hedging relationships, the underlying risk of the forward contracts is identical to the hedged risk, and accordingly we have established a hedge ratio of 1:1. Due to a strong correlation between AECO future contract prices and our delivered cost, we did not experience any ineffectiveness on our hedges, and accordingly we have recorded the full change in the fair value of natural gas forward contracts designated as hedges to other comprehensive income.

Currency risk

Foreign exchange derivative financial instruments outstanding (notional amounts in millions of U.S. dollars)



September 30,
----------------------------------------------------------------------------
2015
----------------------------------------------------------------------------
Average Fair value
contract of assets
Sell/Buy Notional Maturities price(1) (liabilities)
----------------------------------------------------------------------------
Not designated as hedges
----------------------------------------------------------------------------
Forwards
----------------------------------------------------------------------------
USD/CAD 20 2015 1.34 -
----------------------------------------------------------------------------
CAD/USD 1,812 2015 1.33 18
----------------------------------------------------------------------------
USD/AUD 26 2015 1.45 -
----------------------------------------------------------------------------
Swaps
----------------------------------------------------------------------------
USD/AUD 1 2015 1.33 1
----------------------------------------------------------------------------
AUD/USD 1 2015 1.37 -
----------------------------------------------------------------------------
Options
----------------------------------------------------------------------------
USD/CAD - buy USD puts 130 2015 1.23 -
----------------------------------------------------------------------------
USD/CAD - sell USD calls
(2) 135 2015 1.31 (4)
----------------------------------------------------------------------------
15
----------------------------------------------------------------------------

December 31,
----------------------------------------------------------------------------
2014
----------------------------------------------------------------------------
Average Fair value
contract of assets
Sell/Buy Notional Maturities price(1) (liabilities)
----------------------------------------------------------------------------
Not designated as hedges
----------------------------------------------------------------------------
Forwards
----------------------------------------------------------------------------
USD/CAD - - - -
----------------------------------------------------------------------------
CAD/USD 1,675 2015 1.14 31
----------------------------------------------------------------------------
USD/AUD 33 2015 1.13 (3)
----------------------------------------------------------------------------
Swaps
----------------------------------------------------------------------------
USD/AUD 26 2015 1.12 (1)
----------------------------------------------------------------------------
AUD/USD 21 2015 1.13 2
----------------------------------------------------------------------------
Options
----------------------------------------------------------------------------
USD/CAD - buy USD puts - - - -
----------------------------------------------------------------------------
USD/CAD - sell USD calls
(2) - - - -
----------------------------------------------------------------------------
29
----------------------------------------------------------------------------
(1) Foreign currency per U.S. dollar.
(2) Includes $85-million notional of enhanced collars.

September 30, December 31,
------------------------------------------------------
2015 2014
------------------------------------------------------
Fair value Fair value
------------------ ------------------
Financial instruments
measured at fair
value on a recurring Carrying Carrying
basis Level 1 Level 2 value Level 1 Level 2 value
----------------------------------------------------------------------------
Cash and cash
equivalents - 753 753 - 848 848
----------------------------------------------------------------------------
Accounts receivable -
derivatives - 19 19 - 33 33
----------------------------------------------------------------------------
Other current
financial assets -
marketable securities 19 119 138 20 70 90
----------------------------------------------------------------------------
Accounts payable -
derivatives - 22 22 - 18 18
----------------------------------------------------------------------------
Other financial
liabilities -
derivatives - 32 32 - 22 22
----------------------------------------------------------------------------

Other financial
instruments
----------------------------------------------------------------------------
Current portion of
long-term debt
----------------------------------------------------------------------------
Floating rate debt -
amortized cost - 11 11 - 11 11
----------------------------------------------------------------------------
Long-term debt
----------------------------------------------------------------------------
Debentures -
amortized cost - 4,632 4,469 - 3,879 3,483
----------------------------------------------------------------------------
Fixed and floating
rate debt -
amortized cost - 48 48 - 76 76
----------------------------------------------------------------------------



There have been no transfers between Level 1 and Level 2 fair value measurements in the nine months ended September 30, 2015 or September 30, 2014. We do not measure any of our financial instruments using Level 3 inputs.

7. Additional Information

Dividends



September 30,
----------------------------------------------------------------------------
2015
----------------------------------------------------------------------------
Declared
-------------------------------------------
Effective Per share Total Paid to Shareholders Total
----------------------------------------------------------------------------
December 11, 2014 0.78 112 January 21, 2015 109
----------------------------------------------------------------------------
February 24, 2015 0.78 112 April 16, 2015 114
----------------------------------------------------------------------------
May 5, 2015 0.875 125 July 16, 2015 122
----------------------------------------------------------------------------
August 6, 2015 0.875 120 October 15, 2015 N/A
----------------------------------------------------------------------------



In May 2015, our Board of Directors approved an increase to our dividend to $3.50 U.S. per common share on an annualized basis.

Normal course issuer bid

In January 2015, the Toronto Stock Exchange accepted our Normal Course Issuer Bid ("NCIB"). Under the NCIB, we may purchase for cancellation up to 5 percent of our currently issued and outstanding common shares until January 25, 2016. The actual number of shares purchased will be at Agrium's discretion and will depend on market conditions, share prices, Agrium's cash position and other factors. During the nine months ended September 30, 2015, we purchased 5,574,331 shares at an average share price of $100.25 for total consideration of $559-million.

FOR FURTHER INFORMATION PLEASE CONTACT:
Agrium Inc.
Investor/Media Relations:
Richard Downey
Vice President, Investor & Corporate Relations
(403) 225-7357 (FAX)


Agrium Inc.
Todd Coakwell
Director, Investor Relations
(403) 225-7437


Agrium Inc.
Louis Brown
Analyst, Investor Relations
(403) 225-7761
www.agrium.com

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