UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

          (Mark One)

[X] Quarterly Report Pursuant to Section 13 or 15(d)

Of the Securities Exchange Act of 1934

For Quarter Ended September 30, 2001

 

OR

 

[ ] Transition Report Pursuant to Section 13 or 15(d)

Of the Securities Exchange Act of 1934

For Quarter Ended September 30, 2001

Commission File Number 001-12217

 

MISSISSIPPI CHEMICAL CORPORATION

 

Organized in the State of Mississippi

Tax Identification No. 64-0292638

P. O. Box 388, Yazoo City, Mississippi 39194

Telephone No. 662+746-4131

 

               Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes [x]    No [ ]

               The number of shares outstanding of each of the issuer's classes of common stock, as of September 30, 2001.

Class
Number of Shares
Common Stock, $0.01 par value
26,131,917
 

 

MISSISSIPPI CHEMICAL CORPORATION

AND SUBSIDIARIES

INDEX

 
   
Page 

Number
PART I. 
FINANCIAL INFORMATION:
  
Item 1.
Financial Statements       
Consolidated Statements of Income
3  
     Three months ended September 30, 2001 and 2000        
Consolidated Balance Sheets
4 - 5  
     September 30, 2001 and June 30, 2001       
Consolidated Statements of Shareholders' Equity
6  
     Fiscal Year ended June 30, 2001 and   
     Three months ended September 30, 2001       
Consolidated Statements of Cash Flows
7  
     Three months ended September 30, 2001 and 2000       
Notes to Consolidated Financial Statements
8 - 15     
Item 2.
Management's Discussion and Analysis of Results    
of Operations and Financial Condition
16 - 23     
Item 3.
Quantitative and Qualitative Disclosure About    
Market Risk
24        
PART II. 
OTHER INFORMATION:      
Item 6.
Exhibits and Reports on Form 8-K
25     
Signatures 
25
 

 

PART I.
FINANCIAL INFORMATION

ITEM 1.
FINANCIAL STATEMENTS.
 

MISSISSIPPI CHEMICAL CORPORATION

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)
   
Three months ended

September 30,    
2001
2000 
(In thousands, except per share data)
Revenues:     
     Net sales   
$107,843 
$120,053       
Operating expenses:     
     Cost of products sold   
106,694 
122,561 
     Selling, general and administrative   
7,148 
8,773 
     Other   
      6,618 
     3,436     
 120,460 
 134,770       
Operating loss   
(12,617)
(14,717)      
Other (expense) income:     
     Interest, net   
(7,686)
(7,159)
     Other   
     3,201 
     1,459       
Loss before income taxes   
(17,102)
(20,417)      
Income tax benefit   
   (9,052)
   (8,171)      
Net loss   
$  (8,050)
$(12,246)
Loss per share - basic and diluted      
     (see Note 2)   
$   (0.31)
$    (0.47)
The accompanying notes are an integral part of these consolidated financial statements.

 

 

MISSISSIPPI CHEMICAL CORPORATION

AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)

ASSETS

 
  
September 30, 
June 30,  
2001 
2001  
(In thousands, except per share data)
Current assets:    
   Cash and cash equivalents 
$    2,074  
$  11,797 
   Accounts receivable, net 
41,635  
54,196      
   Inventories:    
      Finished products 
40,068  
44,502 
      Raw materials and supplies 
5,578  
6,230 
      Replacement parts 
     35,752  
     36,380 
             Total inventories 
81,398  
87,112      
   Prepaid expenses and other current assets 
6,401  
2,364 
   Deferred income taxes 
       7,550  
       7,280      
                       Total current assets 
139,058  
162,749      
Investments in affiliates 
99,155  
96,064      
Other assets 
6,210  
6,304      
Property, plant and equipment, at cost 
835,883  
841,080 
  less accumulated depreciation, depletion 
    and amortization 
  (434,360) 
  (430,788)
             Net property, plant and equipment 
401,523  
410,292      
Goodwill, net of accumulated amortization 
   103,465  
   104,198        
$ 749,411  
$ 779,607 
 

The accompanying notes are an integral part of these consolidated financial statements.

 

 

MISSISSIPPI CHEMICAL CORPORATION

AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Continued)

LIABILITIES AND SHAREHOLDERS' EQUITY
  
September 30, 
June 30,  
2001 
2001  
(In thousands, except per share data)     
Current liabilities:    
   Accounts payable 
$  40,755  
$  38,167 
   Accrued liabilities 
    16,551  
    10,797 
          Total current liabilities 
57,306  
48,964      
Long-term debt 
365,169  
386,285      
Other long-term liabilities and deferred credits 
10,773  
10,922      
Deferred income taxes 
34,731  
43,679      
Shareholders' equity:    
   Common stock ($.01 par, authorized 100,000   
        shares; issued 27,976) 
280  
280 
   Additional paid-in capital 
305,901  
305,901 
   Retained earnings 
10,913  
18,963 
   Accumulated other comprehensive loss 
(6,083) 
(5,808)
   Treasury stock, at cost (1,844 shares) 
   (29,579) 
   (29,579)
          Total shareholders' equity 
   281,432  
  289,757        
$ 749,411  
$ 779,607 
 

The accompanying notes are an integral part of these consolidated financial statements.

 

 

MISSISSIPPI CHEMICAL CORPORATION

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

SEPTEMBER 30, 2001

(Unaudited)
 
 

 

Common

Stock
Additional 

Paid-In

Capital
 

Retained

Earnings
Accumulated

Other

Comprehensive

Income (Loss)
 

Treasury

Stock
 

 

Total
(In thousands, except per share data)            
Balances, July 1, 2000
$     280
$  305,901
$114,996 
$        -       
$(29,579)
$391,598 
  Comprehensive loss:      
          Cumulative net 

 

 

 

 

 

 
       unrealized gain on             hedges, net of tax             of $2,482
-    
-      
-       
4,149  
-       
4,149 
     Net loss
-    
-      
(95,249)
-       
-       
(95,249)
     Net unrealized loss on      
       hedges, net of tax      
              benefit of $5,966
       -    
        -      
      -       
        (9,957)
      -       
     (9,957)       
          Comprehensive loss
-    
-      
(95,249)
(5,808)
-       
(101,057)       
     Cash dividends paid      
       ($0.03 per share)
       -    
        -      
       (784)
           -       
      -       
        (784)       
Balances, June 30, 2001
280
305,901
18,963 
(5,808) 
(29,579)
289,757 
  Comprehensive loss:      
     Net loss
-    
-      
(8,050)
-       
-       
(8,050)
     Net unrealized loss on      
       hedges, net of tax       
              benefit of $166
       -    
        -      
        -      
         (275) 
        -       
       (275)       
          Comprehensive loss
              -    
                -      
      (8,050)
                  (275)
             -       
    (8,325)       
Balances, 
        September 30, 2001
$      280
$  305,901
$  10,913
$     (6,083)
$(29,579)
$281,432 
 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

MISSISSIPPI CHEMICAL CORPORATION

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)
  
Three months ended September 30,  
2001 
2000  
(In thousands)
Cash flows from operating activities:    
  Net loss 
$    (8,050) 
$   (12,246)
  Reconciliation of net loss to net cash provided 
        by operating activities:    
       Net change in operating assets and liabilities 
22,383   
17,641 
       Depreciation, depletion and amortization 
11,169  
12,038 
       Deferred loss on hedging activities, net of tax 
(1,589) 
-      
       Deferred income taxes 
(10,007) 
(4,761)
       Equity earnings in unconsolidated affiliates 
(3,681) 
(2,723)
       Other 
      (3,567) 
          330      
Net cash provided by operating activities 
         6,658  
      10,279      
Cash flows from investing activities:    
  Purchases of property, plant and equipment 
(2,858) 
(4,495)
  Proceeds from sale of assets 
4,806  
2,358 
  Other 
       2,800  
             300      
Net cash provided by (used in) investing activities 
       4,748  
     (1,837)     
Cash flows from financing activities:    
  Debt proceeds 
52,669  
88,521 
  Debt payments 
(73,798) 
(96,328)
  Cash dividends paid 
          -       
          (784)     
Net cash used in financing activities 
   (21,129) 
      (8,591)     
Net decrease in cash and cash equivalents 
(9,723) 
(149)     
Cash and cash equivalents - beginning of period 
     11,797  
       2,190      
Cash and cash equivalents - end of period 
$     2,074  
$      2,041 
 

The accompanying notes are an integral part of these consolidated financial statements.

 

 

MISSISSIPPI CHEMICAL CORPORATION

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
**NOTE 1 - INTERIM FINANCIAL STATEMENTS**
The accompanying consolidated financial statements have been prepared by us without audit, and include Mississippi Chemical Corporation, its subsidiaries and affiliates.  In our opinion, the financial statements reflect all adjustments necessary to present fairly our results of operations for the three-month period ended September 30, 2001 and 2000, our financial position at September 30, 2001 and June 30, 2001, our consolidated statements of shareholders' equity for the three months ended September 30, 2001 and the year ended June 30, 2001, and our cash flows for the three months ended September 30, 2001 and 2000.  In our opinion, these adjustments are of a normal recurring nature which are necessary for a fair presentation of our financial position and results of operations for the interim periods.  We have reclassified certain prior-year information to conform with the current year's presentation.

Certain notes and other information have been condensed or omitted in our interim financial statements presented in this quarterly report on Form 10-Q.  Therefore, these financial statements should be read in conjunction with our 2001 Annual Report on Form 10-K and our consolidated financial statements and notes thereto included in our June 30, 2001, audited financial statements.

Our business is seasonal; therefore, the results of operations for the period ended September 30, 2001, are not necessarily indicative of the operating results for the full fiscal year.

 

 
**NOTE 2 - EARNINGS PER SHARE**
The number of shares used in our basic and diluted earnings per share computation are as follows:
  
Three months ended  
September 30,  
2001 
2000  
(In thousands)
Weighted average common shares
 
 
 
 
  outstanding, net of treasury shares, for      basic earnings per share 
26,132 
26,132
Common stock equivalents for employee    
    stock options 
    -      
    -          
Weighted average common shares    
   outstanding for diluted earnings per share 
26,132 
26,132
Options outstanding were not included in our computations of diluted earnings per share for the three-month period ended September 30, 2001 and 2000, because they were antidilutive.

 

 
**NOTE 3 - SEGMENT INFORMATION**
Our reportable operating segments, nitrogen, phosphate and potash, are strategic business units that offer different products.  They are managed separately because each business unit requires different technology and marketing strategies.  Our nitrogen segment produces ammonia, ammonium nitrate, urea, nitrogen solutions and nitric acid.  We distribute these products to fertilizer dealers and distributors, and industrial users.  Our phosphate segment produces diammonium phosphate fertilizer (commonly referred to as "DAP") that is marketed to agricultural users primarily in international markets through a separate export association.  Our potash segment mines and produces granular and standard potash products and distributes them to agricultural and industrial users.  Below is our segment information for the three-month period ended September 30, 2001 and 2000.  The Other caption includes corporate and consolidating eliminations.
  
Three months ended September 30, 2001
(In thousands) 
Nitrogen
Phosphate
Potash
Other
Total       
Net sales - external customers 
$  64,250 
$  24,565 
$ 19,028 
$     -      
$107,843 
Net sales - intersegment 
5,907 
13 
-      
(5,920)
-      
Operating loss 
(9,057)
(1,287)
(2,282)
9 
(12,617)
Depreciation, depletion and         amortization 
6,941
1,395 
1,753 
1,080 
11,169 
Capital expenditures 
2,051
411 
314 
82 
2,858 
 

 
  
Three months ended September 30, 2000
(In thousands) 
Nitrogen
Phosphate
Potash
Other
Total       
Net sales - external customers 
$ 71,325 
$  29,823 
$18,905 
$   -      
$120,053 
Net sales - intersegment 
7,570 
15 
-      
(7,585)
-      
Operating loss 
(9,863)
(1,907)
(2,425)
(522)
(14,717)
Depreciation, depletion and         amortization 
7,947 
1,505 
1,607 
979 
12,038 
Capital expenditures 
1,877 
293 
2,320 
5 
4,495 ** 

 

NOTE 4 - ACCUMULATED OTHER COMPREHENSIVE LOSS**
Comprehensive loss is the total of net loss and all other non-owner changes in equity.  The components of comprehensive loss that relate to us are net income or loss and unrealized gains or losses on our natural gas derivative transactions, and, as permitted under the provisions of SFAS No. 130, are presented in the Consolidated Statements of Shareholders' Equity.  These derivative transactions may consist of futures contracts, commodity swaps, or similar derivative financial instruments related to the price of natural gas.  The changes in the components of accumulated other comprehensive loss during the three months ended September 30, 2001, are included below.
  
 

Before-Tax

Amount 
Tax

(Expense)

Benefit 
Net-of-Tax

Amount
Net unrealized loss on natural gas hedging 
(In thousands)  activities:             
    Balances, June 30, 2001 
$  (9,292) 
$   3,484  
$  (5,808)       
       Net unrealized loss arising during period 
(4,243) 
1,592  
(2,651)
       Less: reclassification adjustment for net 
                       losses realized in net income 
     3,802  
  (1,426) 
    2,376 
      Balances, September 30, 2001 
$ (9,733) 
$    3,650  
$ (6,083)** 

 

NOTE 5 - GUARANTOR SUBSIDIARIES**
Payment obligations under our 7.25% Senior Notes, due November 15, 2017, issued pursuant to that certain indenture, dated as of November 25, 1997, are fully and unconditionally guaranteed on a joint and several basis by Mississippi Nitrogen, Inc., and MissChem Nitrogen, L.L.C. (the "Guarantor Subsidiaries"), our wholly owned direct subsidiary and our wholly owned indirect subsidiary, respectively.  Condensed consolidating financial information regarding the parent company, Guarantor Subsidiaries and non-guarantor subsidiaries for September 30, 2001 and 2000 is presented below for purposes of complying with the reporting requirements of the Guarantor Subsidiaries.

 

CONDENSED CONSOLIDATING STATEMENT OF INCOME
  
Three months ended September 30, 2001
 
(In thousands) 
Parent

Company
Guarantor

Subsidiaries
Non-Guarantor

Subsidiaries
Eliminations
Consolidated
Revenues:      
  Net sales 
$       -      
$    33,831 
$  108,529 
$  (34,517)
$ 107,843        
Operating expenses:      
  Cost of products sold 
      -      
35,561 
106,006 
(34,873)
106,694 
  Selling, general and
         administrative 
(19)
1,215 
5,952 
-      
7,148 
  Other 
               -      
            3,628 
             2,990 
                  -      
             6,618   
                 (19)
        40,404 
     114,948 
      (34,873)
    120,460 
Operating income (loss) 
 19 
(6,573)
(6,419)
356 
(12,617)       
Other (expense) income:      
  Interest, net 
(7,674)
(2,855)
2,843 
-      
(7,686)
  Other 
             (744)
         (1,588)
            3,181 
             2,352 
            3,201        
Loss before income taxes 
(8,399)
(11,016)
(395)
2,708 
(17,102)       
Income tax benefit 
            (349)
         (6,502)
         (1,051)
         (1,150)
         (9,052)       
Net (loss) income 
$  (8,050)
$  (4,514)
$       656 
$     3,858 
$   (8,050)
 

 

 

CONDENSED CONSOLIDATING STATEMENT OF INCOME
  
Three months ended September 30, 2000
 
(In thousands) 
Parent

Company
Guarantor

Subsidiaries
Non-Guarantor

Subsidiaries
Eliminations
Consolidated
Revenues:      
  Net sales 
$     -    
$     33,883 
$ 144,813  
$  (58,643)
$ 120,053        
Operating expenses:      
  Cost of products sold 
-      
41,137 
140,543  
(59,119)
122,561 
  Selling, general and
    administrative 
513 
1,473 
6,787  
-       
8,773
  Other 
       -      
       1,600 
      1,836  
         -       
      3,436   
          513 
     44,210 
  149,166  
   (59,119)
  134,770 
Operating loss 
(513)
(10,327)
(4,353) 
476 
(14,717)       
Other (expense) income:      
  Interest, net 
(7,574)
(3,488)
3,903 
-       
(7,159)
  Other 
    (5,102)
        3,149 
         209 
      3,203 
      1,459        
Loss before income taxes 
(13,189)
(10,666)
(241) 
3,679 
(20,417)       
Income tax benefit 
              (943)
     (2,060)
     (4,534)
        (634)
    (8,171)       
Net (loss) income 
$(12,246)
$    (8,606)
$      4,293
$    4,313 
$ (12,246)
 

 

 

CONDENSED CONSOLIDATING BALANCE SHEET
 
September 30, 2001
 
(In thousands)
Parent

Company
Guarantor

Subsidiaries
Non-Guarantor

Subsidiaries
Eliminations
 
Consolidated
Assets     
Current assets:     
   Cash and cash equivalents
$    2,003 
$               16 
$               55 
$          -      
$     2,074 
   Receivables, net
2,528 
11,298 
66,483 
(38,674)
41,635 
   Inventories
-      
18,693 
62,305 
400 
81,398 
   Prepaid expenses and other 
         current    assets
                 8,792 
                     1,681 
                    9,993 
                (6,515)
               13,951       
         Total current assets
13,323 
31,688 
138,836 
(44,789)
139,058       
Investments in affiliates
620,138 
294,202 
83,519 
(898,704)
99,155 
Other assets
179,350 
-     
295,120 
(468,260)
6,210 
PP&E, net
9,009 
136,015 
256,499 
-      
401,523 
Goodwill, net
                 -      
                    -     
       103,465 
                          -      
      103,465       
         Total assets
$821,820 
$  461,905 
$  877,439 
$(1,411,753)
$  749,411       
Liabilities and Shareholders' Equity     
Current liabilities:     
   Accounts payable
$  33,855 
$       7,299 
$   50,638 
$     (51,037)
$  40,755 
   Accrued liabilities
         12,778 
              3,607 
              7,059 
                (6,893)
          16,551       
            Total current liabilities
46,633 
10,906 
57,697 
(57,930)
57,306       
Long-term debt
492,222 
154,962 
140,542 
(422,557)
365,169 
Other long-term liabilities and     
   deferred credits
1,533 
33,577 
57,245 
(46,851)
45,504       
Shareholders' equity:     
   Common stock
280 
1 
58,941 
(58,942)
280 
   Additional paid-in capital
305,901 
324,715 
535,866 
(860,581)
305,901 
   Retained earnings
10,913 
(62,256)
27,148 
35,108 
10,913 
   Accumulated other      
      comprehensive loss
(6,083)
-      
-      
-      
(6,083)
   Treasury stock, at cost
     (29,579)
                   -      
                    -      
                         -      
       (29,579)      
   Total shareholders' equity
     281,432 
       262,460 
        621,955 
         (884,415)
      281,432       
          Total liabilities and     
              shareholders' equity
$ 821,820 
$  461,905 
$  877,439 
$(1,411,753)
$ 749,411 
 

 

 

CONDENSED CONSOLIDATING BALANCE SHEET

 
 
June 30, 2001
 
(In thousands)
Parent

Company
Guarantor

Subsidiaries
Non-Guarantor

Subsidiaries
Eliminations
 
Consolidated
Assets     
Current assets:     
   Cash and cash equivalents
$ 11,728 
$         16 
$          53
$           -      
$   11,797 
   Receivables, net
10,785 
11,062 
83,052
(50,703)
54,196 
   Inventories
-      
22,620 
64,421
71 
87,112 
   Prepaid expenses and other
         current    assets
     5,382 
     1,445 
      7,427
      (4,610)
       9,644 
         Total current assets
27,895 
35,143 
154,953
(55,242)
162,749       
Investments in affiliates
620,945 
296,171 
80,003
(901,055)
96,064 
Other assets
180,201 
-      
277,126
(451,023)
6,304 
Property, plant and         equipment, net
9,315 
138,201 
262,776
-       
410,292 
Goodwill, net
         -      
          -      
  104,198
             -       
  104,198       
          Total assets
$838,356 
$469,515 
$879,056
$(1,407,320)
$779,607       
Liabilities and Shareholders' Equity     
Current liabilities:     
   Accounts payable
$  42,171 
$  15,131 
$  45,916
$     (65,051)
$  38,167 
   Accrued liabilities
      6,493 
      2,924 
      5,841
         (4,461)
    10,797       
         Total current liabilities
48,664 
18,055 
51,757
(69,512)
48,964       
Long-term debt
498,166 
150,460 
148,288
(410,629)
386,285 
Other long-term liabilities and     
   deferred credits
1,769 
34,025 
57,713
(38,906)
54,601       
Shareholders' equity:     
   Common stock
280 
1 
58,941
(58,942)
280 
   Additional paid-in capital
305,901 
324,715 
535,866
(860,581)
305,901 
   Retained earnings
18,963 
(57,741)
26,491
31,250  
18,963 
   Accumulated other      
      comprehensive loss
(5,808)
-      
-     
-      
(5,808)
   Treasury stock, at cost
  (29,579)
         -      
          -     
              -      
  (29,579)      
         Total shareholders' equity
  289,757 
  266,975
  621,298
    (888,273)
  289,757       
         Total liabilities and     
              shareholders' equity
$838,356 
$469,515
$879,056
$(1,407,320)
$779,607 
 

 

 

 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

 
 
Three months ended September 30, 2001
 
(In thousands)
Parent

Company
Guarantor

Subsidiaries
Non-Guarantor

Subsidiaries
Eliminations
 
Consolidated      
Cash flows from operating        activities:     
   Net (loss) income
$  (8,050)
$   (4,514)
$         656 
$     3,858 
$     (8,050)
   Reconciliation of net (loss)      
     income to net cash (used in)      
     provided by operating activities:     
          Net change in operating      
             assetsand liabilities
4,977 
(3,671)
19,797 
1,280 
22,383 
          Depreciation, depletion and     
             amortization
1,079 
3,156 
6,934 
-     
11,169 
          Deferred loss on hedging     
             activities, net of tax
(1,589)
-     
-     
-     
(1,589)
          Equity earnings in      
             unconsolidated affiliates
718 
1,473 
(3,520)
(2,352)
(3,681)
          Deferred income taxes and      
             other
       (6,902)
                (353)
          (3,533)
            (2,786)
         (13,574)
Net cash (used in) provided by     
   operating activities
      (9,767)
          (3,909)
         20,334 
                     -     
               6,658       
Cash flows from investing        activities:     
   Purchases of property, plant and     
      equipment
(82)
(1,208)
(1,568)
-     
(2,858)
   Proceeds from sale of assets
-     
120 
4,686 
-     
4,806 
   Other
                -     
                   495 
             2,305 
                     -     
              2,800 
Net cash (used in) provided by     
   investing activities
                (82)
               (593)
             5,423 
                    -     
              4,748       
Cash flows from financing        activities:     
   Debt proceeds
52,669 
-     
-     
-     
52,669 
   Debt payments
(73,798)
-     
-     
-     
(73,798)
   Net change in affiliate notes
       21,253 
              4,502 
        (25,755)
                    -     
                 -      
Net cash provided by (used in)     
   financing activities
                124 
              4,502 
        (25,755)
                    -     
     (21,129)      
Net (decrease) increase in cash      
   and cash equivalents
(9,725)
-     
2 
-     
(9,723)      
Cash and cash equivalents -     
   beginning of period
      11,728 
                        16 
                         53 
                    -     
         11,797       
Cash and cash equivalents -     
   end of period
$  2,003 
$                  16 
$            55 
$           -     
$    2,074 
 

 

 

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

 
 
Three months ended September 30, 2000
 
(In thousands)
Parent

Company
Guarantor

Subsidiaries
Non-Guarantor

Subsidiaries
Eliminations
 
Consolidated      
Cash flows from operating       activities:     
   Net (loss) income
$ (12,246)
$    (8,606)
$       4,293 
$      4,313 
$   (12,246)
   Reconciliation of net (loss)       
     income to net cash (used in)      
     provided by operating activities:     
          Net change in operating      
             assetsand liabilities
(2,949)
5,264 
19,372 
(4,046)
17,641 
          Depreciation, depletion and     
             amortization
979 
3,254 
7,805 
-       
12,038 
          Equity earnings in      
             unconsolidated affiliates
5,986 
(3,045)
(2,461)
(3,203)
(2,723)
          Deferred income taxes and      
             other
    (7,502)
          850 
          (715)
      2,936 
     (4,431)
Net cash (used in) provided by      
   operating activities
   (15,732)
      (2,283)
       28,294 
         -      
    10,279       
Cash flows from investing        activities:     
    Purchases of property, plant      
      and equipment
(5)
(1,381)
(3,109)
-       
(4,495)
    Other
      2,315 
           -       
             343 
        -       
       2,658       
Net cash provided by (used in)        investing activities
      2,310 
      (1,381)
       (2,766)
        -       
      (1,837)      
Cash flows from financing        activities:     
   Debt proceeds
88,521 
-       
-       
-       
88,521 
   Debt payments
(96,328)
-       
-       
-       
(96,328)
   Cash dividends paid
(784)
-       
-       
-       
(784)
   Net change in affiliate notes
     21,884 
       3,664 
     (25,548)
         -       
          -             
Net cash provided by (used in)     
   financing activities
     13,293 
       3,664 
     (25,548)
         -       
      (8,591)      
Net decrease in cash and cash     
   equivalents
(129)
-      
(20)
-       
(149)      
Cash and cash equivalents -     
   beginning of period
       2,085
            17 
            88 
        -       
        2,190       
Cash and cash equivalents -     
   end of period
$     1,956 
$          17 
$          68 
$       -       
$      2,041 
 

 

 
**ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION**
GENERAL.  Our operations are organized into three strategic business units: nitrogen, phosphate and potash.  Our nitrogen business unit produces nitrogen products for distribution to fertilizer dealers and distributors, and industrial users located primarily in the southern region of the United States.  Our phosphate business unit produces diammonium phosphate fertilizer (commonly referred to as "DAP") and exports the majority of this production through Phosphate Chemicals Export Association, Inc., a Webb-Pomerene corporation known as "PhosChem."  Our potash business unit mines and produces agricultural and industrial potash products for sale to farmers, fertilizer dealers and distributors, and industrial users for use primarily in the southern and western regions of the United States.  The following is management's discussion and analysis of results of operations and financial condition, which should be read in conjunction with our audited financial statements and related notes for the fiscal year ended June 30, 2001.

SEASONALITY.  Consistent with the historical nature of our business, the usage of fertilizer in our trade territory is highly seasonal, and our quarterly results reflect the fact that significantly more fertilizer is traditionally sold during the last four months of our fiscal year (March through June).  Since interim period operating results reflect the seasonal nature of our business, they may not necessarily be indicative of results expected for the full fiscal year.  We incur substantial expenditures for fixed costs and inventory throughout the year.  In addition, quarterly results can vary significantly from year to year due to a number of factors as detailed under "Forward Looking Statements" in this report and under the heading "Certain Business Factors" and elsewhere in our most recent Annual Report on Form 10-K which is on file with the Securities and Exchange Commission.  

 
**RESULTS OF OPERATIONS - THREE MONTHS ENDED SEPTEMBER 30, 2001 COMPARED TO THE THREE MONTHS ENDED SEPTEMBER 30, 2000**
OVERVIEW.  For the quarter ended September 30, 2001, we incurred a net loss of $8.1 million (or $0.31 per diluted share) compared to a net loss of $12.2 million (or $0.47 per diluted share) for the same quarter during the prior year.  Net sales decreased to $107.8 million for the quarter ended September 30, 2001, from $120.1 million for the quarter ended September 30, 2000.  We incurred an operating loss of $12.6 million for the quarter ended September 30, 2001, compared to an operating loss of $14.7 million for the quarter ended September 30, 2000.  Earnings before interest, taxes, depreciation and amortization ("EBITDA") for the quarter ended September 30, 2001, were positive $1.8 million compared to negative $1.2 million for the quarter ended September 30, 2000.

 

NET SALES

OVERVIEW.  Our net sales decreased 10% to $107.8 million for the quarter ended September 30, 2001, from $120.1 million for the quarter ended September 30, 2000.  This decrease was primarily the result of lower sales prices for our nitrogen products and lower sales prices and volumes for DAP.

The following tables summarize our sales results by product categories for the three months ended September 30:

  
 

2001
2000
%

Inc. (Dec.)
Net Sales (in thousands):    
   Nitrogen 
 $  64,083
$ 71,180
(10%)
   DAP 
24,557
29,380
(16%)
   Potash 
19,028
18,905
1% 
   Other 
        175
        588
   (70%)     
       Net Sales 
$107,843
$120,053
    (10%)
 

  
 

2001
2000
%

Inc. (Dec.)
Tons Sold (in thousands):    
   Nitrogen:    
       Ammonia 
189
215
(12%)
       Ammonium nitrate 
123
104
18% 
       Urea 
126
143
(12%)
       Nitrogen solutions 
79
46
72% 
       Nitric acid 
       21
      13
     62% 
            Total Nitrogen 
538
521
3%      
   DAP 
210
222
(5%)
   Potash 
222
215
3% 
 

  
 

2001
2000
%

Inc. (Dec.)
Average Sales Price Per Ton:    
   Nitrogen 
$     119
$     137
(13%)
   DAP 
$     117
$     132
(11%)
   Potash 
$       86
$       88
(2%)     
 

NITROGEN.  Our nitrogen sales decreased 10% as a result of a 13% decrease in sales prices partially offset by a 3% increase in sales volumes.  Our ammonia sales prices decreased 14% while sales volumes decreased 12%.  Lower demand from industrial customers, due to the slowing economy, accounted for the decrease in sales volumes.  Anticipation of increased domestic fertilizer production due to lower natural gas prices and the presence of new fertilizer production in South America negatively influenced product prices.  We operated our domestic ammonia plants at approximately 54% of capacity during the quarter.  By the end of the quarter, all of our domestic ammonia plants were operating except for the 500-ton-per-day plant in Yazoo City which was undergoing maintenance work at quarter end.  To meet customer commitments and to offset lost production, we purchased approximately 45,000 tons of ammonia in the open market.  

Ammonium nitrate sales volumes increased 18%, while sales prices decreased 1%.  Late season movement to cotton and stronger pasture applications accounted for the increase in sales volumes.  Our ammonium nitrate operations ran at approximately 58% of capacity for the quarter ended September 30, 2001.  

Urea sales volumes decreased 12%, while average sales prices decreased 5%.  Sales prices decreased as a result of excess industry supply caused by high levels of carryover spring inventory.  Sales volumes were lower during the quarter ended September 30, 2001, because we did not produce or sell any granular urea.  Approximately 16,000 tons of granular urea were sold during the quarter ended September 30, 2000.  On September 20, 2001, the granular urea plant at Faustina, Louisiana, was transferred back to IMC Phosphate Company.  Our prilled urea facility operated at approximately 86% of capacity during the quarter.  

Nitrogen solutions sales volumes increased 72% during the quarter, while the average sales price decreased 19%.  The increase in sales volumes resulted from the purchase of approximately 25,000 tons for resale, late season application to crops, and customers electing to fix product prices early thereby taking delivery from consignment programs.  During the quarter ended September 30, 2000, less product was available for sale due to a scheduled maintenance shutdown at our Yazoo City facility and low beginning inventory levels.  While there were no perceived supply problems in the quarter ended September 30, 2001, during the prior year quarter prices were positively affected by concerns about availability.  We operated our nitrogen solutions production at approximately 72% of capacity during the quarter.

PHOSPHATES.  Our DAP sales decreased 16% as a result of an 11% decrease in sales prices and a 5% decrease in sales volumes.  Sales prices decreased as a result of the world  supply/demand balance; however, improvement was beginning to occur by quarter end as China announced its decision to increase DAP imports for the December 31, 2001 quarter.

POTASH.  Our potash sales increased 1% as a result of a 3% increase in sales volumes partially offset by a 2% decrease in sales prices.  The change in sales prices and volumes resulted from an increase in export sales at lower sales prices.

 

COST OF PRODUCTS SOLD
****
OVERVIEW.  Our cost of products sold decreased to $106.7 million for the quarter ended September 30, 2001, from $122.6 million for the quarter ended September 30, 2000.  As a percentage of net sales, cost of products sold decreased to 99% for the quarter ended September 30, 2001, from 102% for the quarter ended September 30, 2000.  This decrease is primarily the result of lower nitrogen and DAP costs per ton partially offset by lower sales prices for nitrogen and DAP.  Our corporate average natural gas price decreased 16% to $3.32 per MMBtu for the quarter ended September 30, 2001.

NITROGEN.  Our nitrogen costs per ton decreased 17% primarily as a result of lower natural gas costs at our domestic production facilities.  The average price of natural gas, net of futures gains and losses, at our domestic nitrogen production facilities decreased approximately 15% to $3.33 per MMBtu.  We also incurred lower maintenance costs during the quarter ended September 30, 2001.  During the prior year quarter, we incurred additional maintenance costs at our Yazoo City, Mississippi, nitrogen facilities as a result of having scheduled maintenance shutdowns.  During the quarter ended September 30, 2001, we also had higher equity earnings at our joint venture ammonia plant in Trinidad, Farmland MissChem Limited ("Farmland MissChem").  Our portion of the earnings from Farmland MissChem was $3.5 million as compared to $2.5 million for the quarter ended September 30, 2000.  

PHOSPHATES.  Our DAP costs per ton decreased 13% for the quarter ended September 30, 2001.  This decrease was primarily the result of lower raw material costs for sulfur, phosphate rock, ammonia and sulfuric acid.

POTASH.  Our potash costs per ton decreased 3% for the quarter ended September 30, 2001.  This decrease was primarily the result of lower natural gas and labor costs, partially offset by higher electricity costs.

 

SELLING, GENERAL AND ADMINISTRATIVE

Our selling, general and administrative expenses decreased to $7.1 million for the quarter ended September 30, 2001, from $8.8 million for the quarter ended September 30, 2000.  This decrease was primarily the result of reduced goodwill amortization, depreciation and other items during the quarter.  In addition, the prior year included approximately $787,000 in charges related to an early retirement program.  As a percentage of net sales, selling, general and administrative expenses were 7% for the quarter ended September 30, 2001 and September 30, 2000.

 

OTHER OPERATING EXPENSES

Our other operating expenses increased to $6.6 million for the quarter ended September 30, 2001, from $3.4 million for the quarter ended September 30, 2000.  This increase is the result of higher idle plant costs at our nitrogen facilities.  Portions of our ammonia, urea and nitric acid production capacities were idled for various periods primarily due to the unfavorable relationship between product prices and natural gas prices.

 

INTEREST, NET

Our net interest expense for the quarter ended September 30, 2001, increased to $7.7 million from $7.2 million.  This increase was primarily the result of higher average debt balances partially offset by lower average interest rates under our revolving credit facility.

 

OTHER INCOME

Other income increased to $3.2 million from $1.5 million, primarily as a result of gains on the sale of assets.

 

INCOME TAX BENEFIT

For the quarter ended September 30, 2001, our income tax benefit was $9.1 million, as compared to an income tax benefit of $8.2 million for the quarter ended September 30, 2000.  These income tax benefits are primarily the result of our net losses and providing taxes based on an estimated annual effective tax rate of approximately 53%.

 

 
**LIQUIDITY AND CAPITAL RESOURCES**
At September 30, 2001, we had cash and cash equivalents of $2.1 million, compared to $11.8 million at June 30, 2001, a decrease of approximately $9.7 million.

 

OPERATING ACTIVITIES

For the three-month period ended September 30, 2001, our net cash provided by operating activities was $6.7 million compared to $10.3 million for the three-month period ended September 30, 2000.

 

INVESTING ACTIVITIES

Our net cash provided by investing activities was $4.7 million for the three-month period ended September 30, 2001, and included $4.8 million in proceeds from the sale of assets.  These proceeds were partially offset by $2.9 million in capital expenditures that were for normal improvements and modifications to our facilities.  Our net cash used in investing activities was $1.8 million for the three-month period ended September 30, 2000, and included capital expenditures of $4.5 million partially offset by $2.4 million in proceeds from the sale of assets.

 

FINANCING ACTIVITIES

Our net cash used in financing activities was $21.1 million for the three-month period ended September 30, 2001, which reflected net debt payments of $21.1 million.  Our net cash used in financing activities was $8.6 million for the three-month period ended September 30, 2000, which reflected net debt payments of $7.8 million and $784,000 in cash dividends.

We have a secured revolving credit facility (the "Facility") with Harris Trust and Savings Bank and a syndicate of eleven commercial banks totaling $200.0 million.  The Facility matures on November 25, 2002, and bears interest at rates related to the Prime Rate, the London Interbank Offered Rate or the Federal Funds Rate.  At September 30, 2001, we had borrowings outstanding in the amount of $151.0 million, and letters of credit outstanding in the amount of $6.4 million that lowered our availability under the Facility.  We had $35.2 million available under the Facility at September 30, 2001, in addition to cash on hand of $2.1 million.  Amounts outstanding under the Facility are subject to a requirement that the total amount outstanding under the Facility not exceed a certain asset value calculation.  On August 15, 2001, we amended the Facility to provide us with more flexibility under the Facility's covenants in light of the current volatile conditions in our industry and the natural gas markets.  Our borrowing spreads on loans for the September 30, 2001, quarter under the amended Facility increased by 100 basis points over the borrowing spreads in effect prior to fiscal 2002.  Since we were in compliance with all covenants as of September 30, 2001, this borrowing spread increase is only 50 basis points for all future quarters as long as we continue to meet certain covenants.    The specific covenants are more particularly described in the amendment to the Facility filed as an exhibit to our August 20, 2001, Form 8-K and our most recent Annual Report on Form 10-K, each of which is on file with the Securities and Exchange Commission.

Since the Facility matures in November 2002, it will become a current liability on our balance sheet for financial reporting purposes in November 2001.  We are currently exploring refinancing alternatives and believe that we will be able to refinance the Facility at maturity.  However, we cannot guarantee that we will be able to obtain substitute financing or that such financing will consist of terms, particularly interest rates, fees, or amounts, similar to the Facility's.

Based on natural gas and product market prices as of the date of this filing, and our current hedge positions, we believe that our existing cash, cash generated from operations, cash generated from non-core asset dispositions and cash available under the Facility will be sufficient to satisfy our financing requirements for operations and capital projects through fiscal 2002.  There has been unprecedented volatility in natural gas prices since late spring 2000.  Although natural gas prices have declined during calendar 2001, they remain volatile.  If natural gas prices increase without corresponding increases in the market prices for our products, our natural gas costs will have a material adverse impact on our liquidity. 

 
**OUTLOOK**
We believe that world nitrogen demand growth will exceed supply growth over the next several years as a result of projected increases in world demand and fewer new production facilities announced to come online in the next four years.  However, to maximize results in the current environment, we continue to determine operating levels for our plants based on our commitments to customers and the relationship between nitrogen product prices and natural gas prices.    We continue to believe that significantly higher natural gas storage levels, compared to fiscal 2001, will help moderate natural gas pricing during the winter, and reduce the volatility from levels experienced last winter.  This should significantly improve our nitrogen production cost compared to the prior year.  However, if natural gas prices increase, it will have a material adverse impact on our performance if product prices do not experience corresponding increases.  Also, extremely low farm commodity prices continue to negatively influence fertilizer demand worldwide through lower planted acreage, and it is difficult to predict when farm commodity prices will begin to rise.

Currently, phosphate markets are firming as a result of anticipated purchases by China.  PhosChem, our export distributor, announced in October of this year that it had concluded new contracts with China for major sales through calendar 2002.  Approximately two-thirds of our DAP tons are sold into export markets.  We also view the accession of China to the World Trade Organization, which is anticipated to be in early calendar 2002, as positive in the long-term for the DAP industry.  We also anticipate increased domestic demand for DAP in the near-term.  During the last two growing seasons, farmers have reduced the application rates of phosphate and potash fertilizers and "mined" the soil due to low farm commodity prices.  Since agronomic best practices indicate that phosphate and potash fertilizer are necessary soil nutrients that must be replenished, we expect increased domestic application rates.  Finally, we believe potash pricing will remain firm; however, the performance of our potash segment will depend on energy costs and improving ore grades.  Other variables can affect our results of operations as stated elsewhere in the discussion under the headings titled "Results of Operations" and "Forward-Looking Statements," as well as under the heading "Certain Business Factors" and elsewhere in our most recent Annual Report on Form 10-K which is on file with the Securities and Exchange Commission.
** 

FORWARD-LOOKING STATEMENTS**
Except for the historical statements and discussion contained herein, statements set forth in this report constitute "forward-looking statements."  Since these forward-looking statements rely on a number of assumptions concerning future events, risks and other uncertainties that are beyond our ability to control, readers are cautioned that actual results may differ materially from such forward-looking statements.  Future events, risks and uncertainties that could cause a material difference in such results include, but are not limited to, (i) changes in matters which affect the global supply and demand of fertilizer products, (ii) the volatility of the natural gas market, (iii) a variety of conditions in the agricultural industry such as grain prices, planted acreage, projected grain stock, U.S. government policies, weather, and changes in agricultural production methods, (iv) availability and cost of capital; (v) possible unscheduled plant outages and other operating difficulties, (vi) price competition and capacity expansions and reductions from both domestic and international competitors, (vii) foreign government agricultural policies (in particular, the policies of the governments of India and China regarding fertilizer imports), (viii) the relative unpredictability of international and local economic conditions, (ix) the relative value of the U.S. dollar, (x) regulations regarding the environment and the sale and transportation of fertilizer products, and (xi) other important factors affecting the fertilizer industry and us as detailed under the heading "Certain Business Factors" and elsewhere in our most recent Annual Report on Form 10-K which is on file with the Securities and Exchange Commission.
** 

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK.**
We are exposed to market risk, including changes in natural gas prices and interest rates.  For more information about how we manage specific risk exposures, see Note 13 - Hedging Activities, and Note 6 - Credit Agreements and Long-Term Debt, in our Notes to Consolidated Financial Statements contained in our most recent Annual Report on Form 10-K.  

To manage our natural gas price risks, we enter into derivative transactions,primarily in the near-term markets, as the opportunity arises.  Thesederivative transactions may consist of futures contracts, commodity swaps, orsimilar derivative financial instruments related to the price of naturalgas.  We do not hold or issue derivative financial instruments for tradingpurposes.  We maintain formal policies with respect to entering into andmonitoring derivative transactions.  Our derivative transactions areintended to hedge our future natural gas costs.  The volume of natural gashedged varies from time to time based on management's judgment of marketconditions, particularly natural gas prices and nitrogen product prices.

We prepared a sensitivity analysis to estimate our market risk exposurearising from our open natural gas derivative instruments.  At September 30,2001, the fair value of open positions was calculated by valuing each positionusing quoted market prices on the New York Mercantile Exchange ("NYMEX"). We define market risk as the potential loss in fair value as a result of a 10%adverse change in market prices of our open natural gas derivativeinstruments.  We estimate that this adverse change in prices would havereduced the fair value of our open positions by approximately $800,000 atSeptember 30, 2001.

 

 
**PART II.  OTHER INFORMATION**
Item 6.
Exhibits and Reports on Form 8-K.   
(a)   Exhibits.   
        See Index of Exhibits on page 26.   
(b)   Reports on Form 8-K.   
        On August 20, 2001, the registrant filed a Report on Form 8-K regarding its pressrelease of the same date that announced the registrant's results of operations for its fourth fiscal quarter of 2001 and that on August 15, 2001, the registrant amended its revolvingcredit facility. 

 

SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
MISSISSIPPI CHEMICAL CORPORATION    
Date:                                      November13, 2001          
By:  /s/ Timothy A. Dawson 
Timothy A. Dawson 
Senior Vice President and CFO 
(Principal Financial Officer and 
  Chief Accounting Officer)
 

 
**INDEX OF EXHIBITS****EXHIBIT NUMBER**DESCRIPTION**PAGE NO.   
3.1
Articles of Incorporation of the Company; filed as Exhibit 3.1 to theCompany's Amendment No. 1 to Form S-1 Registration Statement filed August 2, 1994, SEC File No. 33-53119, and incorporated herein by reference.

*
3.2
Bylaws of the Company; filed as Exhibit 3.2 to the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 1997, SEC File No. 0-20411, and incorporated herein by reference.

*
4.1
Shareholder Rights Plan; filed as Exhibit 1 to the Company's Form 8-A Registration Statement dated August 15, 1994, SEC File No. 2-7803, and incorporated herein by reference.

*
4.2
Agreement of Substitution and Amendment of Common Shares Rights Agreement dated as of August 1, 2001, among the Company, Harris Trust and Savings Bank, and American Stock Transfer and Trust Company; filed as Exhibit 4.1 to theCompany's Report on Form 8-A/A (Amendment No. 1), SEC File No. 001-12217, and incorporated herein by reference.

*
4.3
Indenture dated as of November 25, 1997, between the Company and Harris Trust and Savings Bank, as Trustee, governing theCompany's 7 1/4% debt securities due November 15, 2017; filed as Exhibit 4(a) to the Company's Current Report on Form 8-K filed November 25, 1997, SEC File No. 001-12217, and incorporated herein by reference.

*
4.4
First Supplemental Indenture dated as of July 1, 1999, among the Company, Mississippi Nitrogen, Inc., MissChem Nitrogen, L.L.C., and Harris Trust and Savings Bank, as Trustee, supplementing the Indenture dated as of November 25, 1997, between the Company and Harris Trust and Savings Bank, as Trustee, governing theCompany's 7 1/4% debt securities due November 15, 2017; filed as Exhibit 4.3 to theCompany's Annual Report on Form 10-K for the fiscal year ended June 30, 2001, SEC File No. 001-12217, and incorporated herein by reference.
*
4.5
Instrument of Resignation, Appointment and Acceptance dated as of February 18, 2000, among the Company, Harris Trust and Savings Bank as the Resigning Trustee, and Trustmark National Bank as the Successor Trustee, under the Indenture dated as of November 25, 1997, between the Company and Harris Trust and Savings Bank, as Trustee, governing the Company's 7 1/4% debt securities due November 15, 2017; filed as Exhibit 4.4 to the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2001, and incorporated herein by reference.

*
4.6
Indenture of Trust dated as of March 1, 1998, between Mississippi Business Finance Corporation and Deposit Guaranty National Bank, for the issuance of bonds in the aggregate principal amount of $14.5 million to assist the Company in financing and refinancing the cost of construction and equipping of solid waste disposal facilities at its Pascagoula, Mississippi, facility; filed as Exhibit 4.3 to theCompany's Annual Report on Form 10-K for the fiscalyear ended June 30, 1998, SEC File No. 0-20411, and incorporated herein by reference. 

*
10.1
Agreement made and entered into as of September 15, 1991, between Office Cherifien des Phosphates and the Company for the sale and purchase of phosphate rock; filed as Exhibit 10.1 to theCompany's Annual Report on Form 10-K for the fiscal year ended June 30, 2001, FileNo. 001-12217, and incorporated herein by reference.(1) 

*
10.2
Amendment No. 1, effective as of July 1, 1992, to the Agreement effective as of September 15, 1991, between Office Cherifien des Phosphates and the Company for the sale and purchase of phosphate rock; filed as Exhibit 10.2 to theCompany's Annual Report on Form 10-K for the fiscal year ended June 30, 2001, SEC File No. 001-12217, and incorporated herein by reference. 

*
10.3
Amendment No. 2, effective as of July 1, 1993, to the Agreement effective as of September 15, 1991, between Office Cherifien des Phosphates and the Company for the sale and purchase of phosphate rock; filed as Exhibit 10.11 to the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 1995, SEC File No. 2-7803, and incorporated herein by reference.(2)

*
10.4
Amendment No. 3, effective as of January 1, 1995, to the Agreement effective as of September 15, 1991, between Office Cherifien des Phosphates and the Company for the sale and purchase of phosphate rock; filed as Exhibit 10.10 to theCompany's Annual Report on Form 10-K for the fiscal year ended June 30, 1995, SEC File No. 2-7803, and incorporated herein by reference.(3)

*
10.5
Amendment No. 4, effective as of January 1, 1997, to the Agreement effective as of September 15, 1991, between Office Cherifien des Phosphates and the Company for the sale and purchase of phosphate rock; filed as Exhibit 10.8 to theCompany's Annual Report on Form 10-K for the fiscal year ended June 30, 1997, SEC File No. 0-20411, and incorporated herein by reference.
*
10.6
Amendment No. 5, effective as of July 1, 2000, to the Agreement effective as of September 15, 1991, between Office Cherifien des Phosphates and the Company for the sale and purchase of phosphate rock; filed as Exhibit 10.6 to theCompany's quarterly report on Form 10-Q for the quarter ended March 31, 2001, SEC File No. 001-12217, and incorporated herein by reference.

*
10.7
Amendment No. 6, effective as of July 1, 2001, to the Agreement effective as of September 15, 1991, between Office Cherifien des Phosphates and the Company for the sale and purchase of phosphate rock.

32
10.8
Credit Agreement dated as of November 25, 1997, among the Company; the Lenders Party Thereto; Harris Trust and Savings Bank, as Administrative Agent; Bank of Montreal, Chicago Branch, as Syndication Agent; and Credit Agricole Indosuez, as Co-Agent, establishing the Company's $200 million revolving line of credit; filed as Exhibit 10.6 to theCompany's Annual Report on Form 10-K for the fiscal year ended June 30, 1998, SEC File No. 0-20411, and incorporated herein by reference.

*
10.9
First Amendment, effective as of June 10, 1999, to Credit Agreement dated as of November 25, 1997, among the Company; the Lenders Party Thereto; Harris Trust and Savings Bank, as Administrative Agent; Bank of Montreal, Chicago Branch, as Syndication Agent; and Credit Agricole Indosuez, as Co-Agent, establishing the Company's $200 million revolving line of credit; filed as Exhibit 10.7 to theCompany's Annual Report on Form 10-K for the fiscal year ended June 30, 1999.
*
10.10
Second Amendment, effective as of September 17, 1999, to Credit Agreement dated as of November 25, 1997, among the Company, the Lenders Party Thereto; Harris Trust and Savings Bank, as Administrative Agent; Bank of Montreal, Chicago Branch, as Syndication Agent; and Credit Agricole Indosuez, as Co-Agent, establishing theCompany's $200 million revolving line of credit, filed as Exhibit 10 to theCompany's Quarterly Report on Form 10-Q for the quarter ended September 30, 1999, SEC File No. 001-12217, and incorporated herein by reference.
*
10.11
Third Amendment, effective as of February 24, 2000, to Credit Agreement dated as of November 25, 1997, among the Company, the Lenders Party Thereto; Harris Trust and Savings Bank, as Administrative Agent; Bank of Montreal, Chicago Branch, as Syndication Agent; and Credit Agricole Indosuez, as Co-Agent, establishing theCompany's $200 million revolving line of credit, filed as Exhibit 10.9 to theCompany's Quarterly Report on Form 10-Q for the quarter ended March 31, 2000, SEC File No. 001-12217, and incorporated herein by reference. 

*
10.12
Fourth Amendment, effective as of August 15, 2001, among Harris Trust and Savings Bank, individually and in its capacity as Administrative Agent thereunder, Bank of Montreal, Chicago Branch, in its capacity as Syndication Agent thereunder, and Credit Agricole Indosuez (formerly known as Caisse Nationale de Credit Agricole) in its capacity as Co-Agent thereunder, and the member banks party thereto; filed as Exhibit 10.1 to theCompany's Current Report on Form 8-K filed August 20, 2001, SEC File No. 001-12217, and incorporated herein by reference.

*
10.13
Form of Severance Agreement dated July 29, 1996, by and between the Company and each of its Executive Officers; filed as Exhibit 10.14 to theCompany's Annual Report on Form 10-K for the fiscal year ended June 30, 1996, SEC File No. 2-7803, and incorporated herein by reference.
*
10.14
Mississippi Chemical Corporation Officer and Key Employee Incentive Plan; filed as Exhibit 10.8 to theCompany's Annual Report on Form 10-K for the fiscal year ended June 30, 1998, SEC File No. 0-20411, and incorporated herein by reference.
*
10.15
Mississippi Chemical Corporation Executive Deferred Compensation Plan, as amended and restated, effective January 1, 2000; filed as Exhibit 10.2 to theCompany's Quarterly Report on Form 10-Q for the quarter ended December 31, 1999, SEC File No. 001-12217, and incorporated herein by reference.
*
10.16
Mississippi Chemical Corporation Nonemployee Directors' Deferred Compensation Plan; filed as Exhibit 10.10 to theCompany's Annual Report on Form 10-K for the fiscal year ended June 30, 1998, SEC File No. 0-20411, and incorporated herein by reference.

*
10.17
Mississippi Chemical Corporation Supplemental Benefit Plan, as amended and restated as of July 1, 1996; filed as Exhibit 10.11 to theCompany's Annual Report on Form 10-K for the fiscal year ended June 30, 1998, SEC File No. 0-20411, and incorporated herein by reference.

*
10.18
Mississippi Chemical Corporation 1994 Stock Incentive Plan; filed as Exhibit 4.2 to theCompany's Form S-8 Registration Statement filed December 21, 1995, SEC File No. 33-65209, and incorporated herein by reference.

*
10.19
Mississippi Chemical Corporation Amended and Restated 1995 Stock Option Plan for Nonemployee Directors effective November 7, 2000; filed as Exhibit 10.1 to theCompany's Quarterly Report on Form 10-Q for the quarter ended December 31, 1999, SEC File No. 001-12217, and as Exhibit 4.2 to theCompany's Form S-8 Registration Statement filed March 8, 2001, SEC File No. 333-56726, and incorporated herein by reference.
*
10.20
Mississippi Chemical Corporation 1995 Restricted Stock Purchase Plan for Nonemployee Directors; filed as Exhibit 4.4 to theCompany's Form S-8 Registration Statement filed December 21, 1995, SEC File No. 33-65209, and incorporated herein by reference.

*
__________________ 

     (1) Pursuant to the Securities Exchange Act of 1934,Rule 24b-2, confidential business information has been deleted from the first,second and third paragraphs of Article IV, Article VII, Article VIII, and fromthe second and third paragraphs of Article IX, and an application forconfidential treatment has been filed separately with the Commission.

     (2) Pursuant to the Securities Exchange Act of 1934,Rule 24b-2, confidential business information has been deleted from paragraphsnumbered 5 and 8 of Amendment No. 2; from the first paragraph, paragraphnumbered 1, paragraph numbered 2, and paragraph numbered 3 of Schedule 1,Exhibit A; from Schedule 2, Exhibit B; from Schedule 3, Exhibit C, and fromSchedule 4, Exhibit D; and an application for confidential treatment has beenfiled separately with the Commission.

     (3) Pursuant to the Securities Exchange Act of 1934,Rule 24b-2, confidential business information has been deleted from Schedule 1to Amendment No. 3, Exhibit B, and an application for confidential treatment hasbeen filed separately with the Commission.

 

* Incorporated by reference.******