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 December 31, 2002

 

OR

 

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

Of the Securities Exchange Act of 1934

For Quarter Ended December 31, 2002

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 [ ]

               Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).  Yes [  ]   No [X]

               The number of shares outstanding of each of the issuer's classes of common stock, as of January 31, 2003.

Class
Number of Shares
Common Stock, $0.01 par value
26,211,633
MISSISSIPPI CHEMICAL CORPORATION

AND SUBSIDIARIES

INDEX

 
   
Page   
Number
PART I. 
FINANCIAL INFORMATION:
  
Item 1.
Financial Statements       
Consolidated Statements of Income
3  
     Three months ended December 31, 2002 and 2001 and    
     Six months ended December 31, 2002 and 2001       
Consolidated Balance Sheets
4 - 5  
     December 31, 2002 and June 30, 2002       
Consolidated Statements of Shareholders' Equity
6  
     Fiscal Year ended June 30, 2002 and   
     Six months ended December 31, 2002       
Consolidated Statements of Cash Flows
7  
     Six months ended December 31, 2002 and 2001       
Notes to Consolidated Financial Statements
8 - 23     
Item 2.
Management's Discussion and Analysis of Results    
of Operations and Financial Condition
24 - 44     
Item 3.
Quantitative and Qualitative Disclosure About    
Market Risk
45     
Item 4.
Controls and Procedures
45    
PART II.
OTHER INFORMATION:      
Item 4.
Submission of Matters to a Vote of Security Holders
46     
Item 6.
Exhibits and Reports on Form 8-K
46     
Signatures 
46     
Certifications 
47 - 48
 
**PART I.**FINANCIAL INFORMATION  **ITEM 1.**FINANCIAL STATEMENTS.
 

MISSISSIPPI CHEMICAL CORPORATION

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)
 
Three months ended

December 31, 
Six months ended

December 31, 
2002 
2001 
2002 
2001 
(In thousands, except per share data)
Revenues:       
   Net sales
$116,826  
$116,014  
$214,352  
$223,858         
Operating expenses:       
  Cost of products sold
115,418  
107,541  
211,301  
214,235 
  Selling, general and       
     administrative
7,353  
6,485  
14,713  
13,633 
   Impairment of long-lived assets
12,351  
-      
12,351  
-     
   Other
        386  
    1,233  
    5,731  
    7,851  
 135,508  
 115,259  
 244,096  
 235,719         
Operating (loss) income
(18,682) 
755  
(29,744) 
(11,861)        
Other (expense) income:       
  Interest, net
(7,645) 
(6,964) 
(14,218) 
(14,650)
  Other
    4,002  
       679  
     4,538  
     3,880         
Loss before income taxes
(22,325) 
(5,530) 
(39,424) 
(22,631)        
Income tax benefit
   (8,153) 
   (4,360) 
   (1,747) 
  (13,411)        
Net loss
$ (14,172) 
$  (1,170) 
$ (37,677) 
$  (9,220)        
Loss per share - basic and       
  diluted (see Note 3)
$    (0.54) 
$    (0.04) 
$    (1.44) 
$   (0.35)
 

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

MISSISSIPPI CHEMICAL CORPORATION

AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)

ASSETS

 
  
December 31, 
June 30,  
2002 
2002  
(In thousands, except per share data)
Current assets:    
   Cash and cash equivalents 
$     4,432  
$   1,989 
   Accounts receivable, net 
49,012  
46,384      
   Inventories:    
     Finished products 
38,542  
25,865 
     Raw materials and supplies 
5,884  
6,120 
     Replacement parts 
     35,053  
    34,761 
           Total inventories 
79,479  
66,746      
   Income tax receivable 
-      
14,971 
   Prepaid expenses and other current assets 
13,537  
3,784 
   Deferred income taxes 
      2,344  
     1,394      
            Total current assets 
148,804  
135,268      
Investments in affiliates 
109,615  
106,972      
Other assets 
7,063  
7,071      
Property, plant and equipment, at cost 
821,289  
840,797 
  less accumulated depreciation, depletion and    
  amortization 
  (459,285) 
 (459,823)
         Property, plant and equipment, net 
   362,004  
  380,974        
$  627,486  
$ 630,285      
 

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

 
  
December 31, 
June 30,  
2002 
2002  
(In thousands, except per share data)     
Current liabilities:    
   Long-term debt due within one year 
$ 142,414  
$ 110,172 
   Accounts payable 
38,376  
35,948 
   Accrued liabilities 
    10,613  
    11,129 
          Total current liabilities 
191,403  
157,249      
Long-term debt 
214,241  
214,215      
Other long-term liabilities and deferred credits 
16,306  
12,540      
Deferred income taxes 
65,083  
66,805      
Shareholders' equity:    
   Common stock ($.01 par, authorized 100,000    
      shares; issued 27,976) 
280  
280 
   Additional paid-in capital 
306,063  
305,901 
   Accumulated deficit 
(140,735) 
(102,577)
   Accumulated other comprehensive income 
3,458  
4,983 
   Treasury stock, at cost (1,778 and     
      1,809 shares) 
   (28,613) 
   (29,111)
          Total shareholders' equity 
  140,453  
  179,476        
$ 627,486  
$ 630,285 
 

 

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

MISSISSIPPI CHEMICAL CORPORATION

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

DECEMBER 31, 2002

(Unaudited)

 
   RetainedAccumulated    AdditionalEarningsOther   CommonPaid-In(Accumulated)ComprehensiveTreasury  
Stock
Capital
(Deficit)
(Loss) Income
Stock
Total
(In thousands)            
Balances, July 1, 2001
$     280
$  305,901
$  18,963 
$    (5,808)
$(29,579)
$289,757 
  Comprehensive loss:      
     Net loss
-    
-      
(121,196)
-       
-     
(121,196)
     Net change in      
                unrealized loss on      
        hedges, net of tax      
                expense of $6,474
      -    
       -    
      -       
     10,791 
        -     
    10,791        
          Comprehensive loss
-    
-    
(121,196)
10,791 
-     
(110,405)       
     Treasury stock, net
      -    
        -    
       (344)
         -     
       468 
        124        
Balances, June 30, 2002
280
305,901
(102,577)
4,983 
(29,111)
179,476 
  Comprehensive loss:      
     Net loss
-    
-    
(37,677)
-     
-     
(37,677)
     Net change in      
        unrealized gain on      
        hedges, net of tax       
        benefit of $848
      -    
       -    
       -     
      (1,525)
       -     
   (1,525)       
          Comprehensive loss
-    
-    
(37,677)
(1,525)
-     
(39,202)       
     Stock based       
        compensation
-    
162 
-      
-      
-     
162 
     Treasury stock, net
        -    
       -    
       (481)
        -      
       498 
          17        
Balances,      
  December 31, 2002
$      280
$  306,063
$ (140,735)
$      3,458
$(28,613)
$140,453        
 

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

MISSISSIPPI CHEMICAL CORPORATION

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)
  
Six months ended December 31,  
2002 
2001  
(In thousands)
Cash flows from operating activities:    
  Net loss 
$  (37,677) 
$    (9,220)
  Reconciliation of net loss to net cash (used in)    
     provided by operating activities:    
       Net change in operating assets and liabilities 
(24,105) 
11,645 
       Refund of federal taxes pursuant to the Job     
           Creation and Workforce Assistance Act of 2002 
14,871 ********