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 March 31, 2002

OR

 

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

Of the Securities Exchange Act of 1934

For Quarter Ended March 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 [ ]

               The number of shares outstanding of each of the issuer's classes of common stock, as of March 31, 2002.

Class
Number of Shares
Common Stock, $0.01 par value
26,161,161
MISSISSIPPI CHEMICAL CORPORATION

AND SUBSIDIARIES

INDEX

 
   
Page 

Number
PART I. 
FINANCIAL INFORMATION:
  
Item 1.
Financial Statements       
Consolidated Statements of Income
3  
     Three months ended March 31, 2002 and 2001 and    
            Nine months ended March 31, 2002 and 2001       
Consolidated Balance Sheets
4 - 5  
     March 31, 2002 and June 30, 2001       
Consolidated Statements of Shareholders' Equity
6  
     Fiscal Year ended June 30, 2001 and   
     Nine months ended March 31, 2002       
Consolidated Statements of Cash Flows
7  
     Nine months ended March 31, 2002 and 2001       
Notes to Consolidated Financial Statements
8 - 17     
Item 2.
Management's Discussion and Analysis of Results    
of Operations and Financial Condition
18 - 30     
Item 3.
Quantitative and Qualitative Disclosure About    
Market Risk
31        
PART II. 
OTHER INFORMATION:      
Item 6.
Exhibits and Reports on Form 8-K
32     
Signatures 
32
 

PART I.
FINANCIAL INFORMATION  
ITEM 1.
FINANCIAL STATEMENTS.
 

MISSISSIPPI CHEMICAL CORPORATION

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)
 
Three months ended

March 31, 
Nine months ended

March 31, 
2002 
2001 
2002 
2001 
(In thousands, except per share data)
Revenues:       
   Net sales
$  94,694  
$147,512  
$318,552  
$403,880         
Operating expenses:       
      Cost of products sold
95,610  
132,225  
309,844  
389,905 
   Selling, general and       
             administrative
7,009  
7,463  
20,643  
23,499 
      Other
     1,135  
     6,647  
     8,986  
    13,029  
 103,754  
 146,335  
 339,473  
 426,433         
Operating (loss) income
(9,060) 
1,177  
(20,921) 
(22,553)        
Other (expense) income:       
      Interest, net
(6,799) 
(7,009) 
(21,448) 
(21,278)
      Other
   11,304  
    5, 457  
   15,184  
      7,837         
Loss before income taxes
(4,555) 
(375) 
(27,185) 
(35,994)        
Income tax expense (benefit)
        432  
        120  
   (12,979) 
   (14,042)        
Net loss
$   (4,987) 
$     (495) 
$  (14,206) 
$ (21,952)        
Loss per share - basic and       
      diluted (see Note 3)
$     (0.19) 
$     (0.02) 
$     (0.54) 
$     (0.84)
 

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

 

 

MISSISSIPPI CHEMICAL CORPORATION

AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)

ASSETS
  
March 31, 
June 30,  
2002 
2001  
(In thousands, except per share data)
Current assets:    
   Cash and cash equivalents 
$         1,157  
$     11,797 
   Accounts receivable, net 
42,355  
51,692      
      Inventories:    
        Finished products 
47,079  
44,502 
      Raw materials and supplies 
5,025  
6,230 
      Replacement parts 
     35,683  
     36,380 
         Total inventories 
87,787  
87,112      
      Income tax receivable 
10,264  
2,504 
   Prepaid expenses and other current assets 
8,832  
2,364 
   Deferred income taxes 
          226  
       7,280      
                       Total current assets 
150,621  
162,749      
Investments in affiliates 
103,817  
96,064      
Other assets 
4,736  
6,304      
Property, plant and equipment, at cost 
839,425  
841,080 
  less accumulated depreciation, depletion     
    and amortization 
  (452,178) 
  (430,788)
             Net property, plant and equipment 
387,247  
410,292      
Goodwill, net of accumulated amortization 
   101,997  
   104,198        
$ 748,418  
$ 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
  
March 31, 
June 30,  
2002 
2001  
(In thousands, except per share data)     
Current liabilities:    
      Long-term debt due within one year 
$122,787  
$      -       
   Accounts payable 
31,052  
38,167 
   Accrued liabilities 
    14,543  
    10,797 
          Total current liabilities 
168,382  
48,964      
Long-term debt 
214,202  
386,285      
Other long-term liabilities and deferred credits 
11,519  
10,922      
Deferred income taxes 
66,553  
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 
4,413  
18,963 
   Accumulated other comprehensive     
            income (loss) 
6,279  
(5,808)
   Treasury stock, at cost (1,815 shares) 
   (29,111) 
   (29,579)
                    Total shareholders' equity 
   287,762  
   289,757        
$ 748,418  
$ 779,607 
 

 

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

 

 

MISSISSIPPI CHEMICAL CORPORATION

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

MARCH 31, 2002

(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 change in       
                unrealized gain 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
-    
-      
(14,206)
-       
-       
(14,206)
     Net change in       
                unrealized loss on      
        hedges, net of tax       
                expense of $7,252
       -    
        -      
       -      
      12,087 
       -       
    12,087        
          Comprehensive loss
              -    
                -      
   (14,206)
             12,087 
             -       
       (2,119)       
          Treasury stock, net
              -    
                -      
              (344)
                   -       
                 468 
                124        
Balances,      
      March 31, 2002
$    280
$305,901
$    4,413
$         6,279 
$(29,111)
$287,762        
 

 

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

 

MISSISSIPPI CHEMICAL CORPORATION

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)
  
Nine months ended March 31,  
2002 
2001  
(In thousands)
Cash flows from operating activities:    
Net loss 
$   (14,206) 
$   (21,952)
  Reconciliation of net loss to net cash provided by    
     (used in) operating activities:    
       Net change in operating assets and liabilities 
(1,772) 
(26,778)
       Depreciation, depletion and amortization 
33,494  
35,157 
       Change in deferred loss on hedging activities,    
                     net of tax 
6,015  
1,872 
              Collection of prior year taxes paid 
26,446  
-      
       Deferred income taxes 
(161) 
(13,079)
       Equity earnings in unconsolidated affiliates 
(9,024) 
(5,149)
       Other 
      (2,545) 
      (2,512)     
Net cash provided by (used in) operating activities 
       38,247  
     (32,441)     
Cash flows from investing activities:    
  Purchases of property, plant and equipment 
(7,868) 
(13,997)
  Proceeds from sale of assets 
5,017  
15,583 
  Other 
       3,300  
             750      
Net cash provided by investing activities 
             449  
      2,336      
Cash flows from financing activities:    
  Debt proceeds 
167,904  
334,331 
  Debt payments 
(217,240) 
(304,703)
  Cash dividends paid 
         -       
          (784)     
Net cash (used in) provided by financing activities 
   (49,336) 
     28,844      
Net decrease in cash and cash equivalents 
(10,640) 
(1,261)     
Cash and cash equivalents - beginning of period 
     11,797  
      2,190      
Cash and cash equivalents - end of period 
$     1,157  
$          929 
 

 

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 and its subsidiaries.  In our opinion, the financial statements reflect all adjustments necessary to present fairly our results of operations for the three-month and the nine-month periods ended March 31, 2002 and 2001, our financial position at March 31, 2002 and June 30, 2001, our consolidated statements of shareholders' equity for the nine months ended March 31, 2002 and the year ended June 30, 2001, and our cash flows for the nine months ended March 31, 2002 and 2001.  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 periods ended March 31, 2002, are not necessarily indicative of the operating results for the full fiscal year.

 
**NOTE 2 - LONG-TERM DEBT DUE WITHIN ONE YEAR**
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 March 31, 2002, we had borrowings outstanding under the Facility in the amount of $122.8 million.

Since the Facility matures in November 2002, it became a current liability on our balance sheet for financial reporting purposes in the quarter ended December 31, 2001.  We are currently exploring refinancing alternatives and believe that we will be able to refinance the Facility at or prior to maturity.  We have engaged Credit Suisse First Boston Corporation to help us evaluate such alternatives.  However, we cannot guarantee that we will be able to obtain new financing or the same amount, and that such financing is likely to will contain terms, particularly interest ratesand fees, not as favorable as the Facility's.

 
**NOTE 3 - EARNINGS PER SHARE**
The number of shares used in our basic and diluted earnings per share computation are as follows:
  
Three months ended 
Nine months ended  
March 31, 
March 31,  
2002 
2001 
2002 
2001  
(In thousands)
Weighted average common shares        
       outstanding, net of treasury shares, for        
       basic earnings per share 
26,139 
26,132 
26,135 
26,132
Common stock equivalents for employee        
    stock options 
    -      
    -      
          -     
        -              
Weighted average common shares        
   outstanding for diluted earnings per share 
26,139 
26,132 
26,135 
26,132****
Options outstanding were not included in our computations of diluted earnings per share for the three-month or nine-month periods ended March 31, 2002 and 2001, because they were antidilutive.

 
**NOTE 4 - 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 and nine-month periods ended March 31, 2002 and 2001.  The Other caption includes corporate and consolidating eliminations.
  
Three months ended March 31, 2002
(In thousands) 
Nitrogen
Phosphate
Potash
Other
Total       
Net sales - external customers 
$  50,631 
$  24,555 
$ 19,508 
$    -      
$ 94,694 
Net sales - intersegment 
4,086 
17 
-      
(4,103)
-      
Operating (loss) income 
(10,214)
1,667 
(798)
285 
(9,060)
Depreciation, depletion and      
  amortization 
6,687
1,409 
1,900 
1,164 
11,160 
Capital expenditures 
367
1,872 
488 
15 
2,742 
 
  
Three months ended March 31, 2001
(In thousands) 
Nitrogen
Phosphate
Potash
Other
Total       
Net sales - external customers 
$101,400 
$  25,439 
$20,673 
$    -      
$147,512 
Net sales - intersegment 
11,762 
16 
-      
(11,778)
-      
Operating income (loss) 
3,523 
(2,695)
(630)
979 
1,177 
Depreciation, depletion and      
  amortization 
7,486 
1,366 
1,683 
920 
11,455 
Capital expenditures 
1,898 
302 
652 
148 
3,000 ** **  
Nine months ended March 31, 2002
(In thousands) 
Nitrogen
Phosphate
Potash
Other
Total       
Net sales - external customers 
$184,830
$  77,092 
$56,630 
$   -       
$318,552 
Net sales - intersegment 
14,950 
52 
-      
(15,002)
-      
Operating (loss) income 
(18,842)
1,334 
(4,475)
1,062 
(20,921)
Depreciation, depletion and      
  amortization 
20,536 
4,206 
5,347 
3,405 
33,494 
Capital expenditures 
2,646 
3,387 
1,697 
138 
7,868 ** **  
Nine months ended March 31, 2001
(In thousands) 
Nitrogen
Phosphate
Potash
Other
Total       
Net sales - external customers 
$270,948 
$  78,124 
$54,808 
$   -      
$403,880 
Net sales - intersegment 
26,443 
48 
-      
(26,491)
-      
Operating (loss) income 
(12,576)
(8,495)
(2,875)
1,393 
(22,553)
Depreciation, depletion and      
  amortization 
23,152 
4,221 
4,972 
2,812 
35,157 
Capital expenditures 
7,572 
2,151 
4,093 
181 
13,997 ** 

NOTE 5 - ACCUMULATED OTHER COMPREHENSIVE INCOME ( 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 income (loss) during the nine months ended March 31, 2002, are included below.
  
Before-Tax

Amount 
Tax

Effect 
Net-of-Tax

Amount  
(In thousands)
Net unrealized loss on natural gas hedging       
    activities at June 30, 2001 
$  (9,292) 
$   3,484  
$  (5,808)       
       Net unrealized gain arising during period 
1,760  
(659) 
1,101 
              Reclassification adjustment for net      
           losses realized in net income 
   17,578  
    (6,592) 
  10,986        
Net unrealized gain on natural gas hedging       
       activities at March 31, 2002 
$ 10,046  
$  (3,767) 
$  6,279 ** 

NOTE 6 - SETTLEMENT OF LITIGATION**
In January 2002, we settled the defamation action we filed against Terra International, Inc. in August 1995.  We received $11.0 million in our third fiscal quarter related to this settlement that was recorded as a component of other income in our Statement of Operations.  This settlement was with Zurich Specialties London, Ltd., which was Terra's liability carrier, and this payment concluded this litigation.

In April 2002, we received approximately $4.3 million in net proceeds from the conclusion of litigation related to defective equipment purchased at our Yazoo City, Mississippi, nitrogen production facility.  The problems arising from this equipment occurred during periods prior to this fiscal year.  This amount will be recorded as a component of other income in our fourth fiscal quarter Statement of Operations.
**NOTE 7 - 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 March 31, 2002 and 2001 is presented below for purposes of complying with the reporting requirements of the Guarantor Subsidiaries.

CONDENSED CONSOLIDATING STATEMENT OF INCOME
  
Three months ended March 31, 2002
 
(In thousands) 
Parent

Company
Guarantor

Subsidiaries
Non-Guarantor

Subsidiaries
Eliminations
Consolidated
Revenues:      
  Net sales 
$      -                  
$ 30,851 
$  95,917 
$ (32,074)
$  94,694        
Operating expenses:      
  Cost of products sold 
-       
36,022 
90,522 
(30,934)
95,610 
  Selling, general and      
          administrative 
  (293)
1,337 
5,965 
-       
7,009 
  Other 
              -      
                853 
                282 
                -       
             1,135   
            (293)
      38,212 
       96,769 
     (30,934)
    103,754 
Operating income (loss) 
293 
(7,361)
(852)
(1,140)
(9,060)       
Other (expense) income:      
  Interest, net 
(3,552)
(2,140)
(1,107)
-       
(6,799)
  Other 
         3,215 
          1,480 
                142 
           6,467 
       11,304        
(Loss) income before      
      income taxes 
(44)
(8,021)
(1,817)
5,327 
(4,555)
Income tax expense       
     (benefit) 
         4,943 
            3,455 
       (2,895)
        (5,071)
                  432        
Net (loss) income 
$  (4,987)
$ (11,476)
$      1,078 
$  10,398               
$   (4,987)
 

 

CONDENSED CONSOLIDATING STATEMENT OF INCOME
  
Three months ended March 31, 2001
 
(In thousands) 
Parent

Company
Guarantor

Subsidiaries
Non-Guarantor

Subsidiaries
Eliminations
Consolidated
Revenues:      
  Net sales 
$     -    
$     53,395 
$ 148,666  
$  (54,549)
$ 147,512        
Operating expenses:      
  Cost of products sold 
-      
53,600 
129,875  
(51,250)
132,225 
    Selling, general and      
    administrative 
(988)
1,518 
6,933  
-       
7,463 
  Other 
       -      
          749 
      5,898  
        -       
      6,647   
       (988)
     55,867 
  142,706  
   (51,250)
  146,335 
Operating income (loss) 
988 
(2,472)
5,960  
(3,299)
1,177        
Other (expense) income:      
  Interest, net 
(7,301)
(3,795)
4,087 
-       
(7,009)
  Other 
     3,145 
     13,794 
      4,307 
   (15,789)
      5,457        
(Loss) income before      
      income taxes 
(3,168)
7,527 
14,354 
(19,088)
(375)       
Income tax (benefit)       
      expense 
      (2,673)
       4,299 
         (222)
      (1,284)
             120        
Net (loss) income 
$       (495)
$     3,228 
$  14,576
$ (17,804)
$        (495)
 

 

CONDENSED CONSOLIDATED STATEMENT OF INCOME
  
Nine months ended March 31, 2002
 
(In thousands) 
Parent

Company
Guarantor

Subsidiaries
Non-Guarantor

Subsidiaries
Eliminations
Consolidated
Revenues:      
   Net sales 
$           -       
$ 104,162 
$ 320,911   
$(106,521)  
$  318,552        
Operating expenses:      
  Cost of products sold 
      -       
116,172 
300,563 
(106,891)
309,844 
  Selling, general and      
         administrative 
(1,082)
3,810 
17,915 
-       
20,643 
  Other 
              -            
           5,539 
            3,447 
                  -       
              8,986   
       (1,082)
   125,521 
   321,925 
   (106,891)
     339,473 
Operating income (loss) 
1,082 
(21,359)
(1,014)
370 
(20,921)       
Other (expense) income:      
  Interest, net 
(18,211)
(7,904)
(4,284)
8,951 
(21,448)
  Other 
       11,288 
          6,409 
            3,812 
           (6,325)
         15,184        
(Loss) income before       
      income taxes 
(5,841)
(22,854)
(1,486)
2,996 
(27,185)       
Income tax expense       
      (benefit) 
          8,365 
    (10,145)
        (8,731)
         (2,468)
      (12,979)       
Net (loss) income 
$(14,206)
$ (12,709)
$      7,245 
$      5,464 
$ (14,206)
 

 

CONDENSED CONSOLIDATING STATEMENT OF INCOME
  
Nine months ended March 31, 2001
 
(In thousands) 
Parent

Company
Guarantor

Subsidiaries
Non-Guarantor

Subsidiaries
Eliminations
Consolidated
Revenues:      
  Net sales 
$     -    
$    131,654 
$ 406,703  
$ (134,477)
$ 403,880        
Operating expenses:      
  Cost of products sold 
-      
142,484 
381,029  
(133,608)
389,905 
    Selling, general and      
    administrative 
(1,424)
4,481 
20,442  
-       
23,499 
  Other 
        -      
       3,432 
      9,597  
         -       
     13,029   
   (1,424)
    150,397 
  411,068  
 (133,608)
   426,433 
Operating income (loss) 
1,424 
(18,743)
(4,365) 
(869)
(22,553)       
Other (expense) income:      
  Interest, net 
(22,482)
(11,006)
12,210 
-       
(21,278)
  Other 
    (4,971)
     18,826 
        4,613 
   (10,631)
     7,837        
(Loss) income before      
      income taxes 
(26,029)
(10,923)
12,458 
(11,500)
(35,994)       
Income tax (benefit)      
     expense 
        (4,077)
         2,054 
    (10,071)
    (1,948)
  (14,042)       
Net (loss) income 
$ (21,952)
$   (12,977)
$     22,529
$   (9,552)
$ (21,952)
 

 

 CONDENSED CONSOLIDATING BALANCE SHEET
 
March 31, 2002
 
(In thousands)
Parent

Company
Guarantor

Subsidiaries
Non-Guarantor

Subsidiaries
Eliminations
 
Consolidated
Assets     
Current assets:     
   Cash and cash equivalents
$    1,090 
$                   16 
$                   51 
$                    -       
$        1,157 
   Receivables, net
21,255 
10,718 
51,064 
(30,418)
52,619 
   Inventories
-      
19,703 
67,672 
412 
87,787 
   Prepaid expenses and other      
           current assets
        6,695 
              1,550 
             5,836 
                 (5,023)
            9,058       
          Total current assets
29,040 
31,987 
124,623 
(35,029)
150,621       
Investments in affiliates
366,402 
301,686 
88,516 
(652,787)
103,817 
Other assets
304,165 
-      
70,108 
(369,537)
4,736 
PP&E, net
8,282 
129,862 
249,103 
-       
387,247 
Goodwill, net
              -      
                  -      
      101,997 
                        -       
     101,997       
           Total assets
$707,889 
$ 463,535 
$ 634,347 
$(1,057,353)
$748,418             Liabilities and Shareholders'     
   Equity     
Current liabilities:     
      Long-term debt due within      
           one year
$122,787 
$        -      
$             -       
$                    -       
$  122,787 
   Accounts payable
14,215 
12,387 
47,175 
(42,725)
31,052 
   Accrued liabilities and other
        11,521 
              2,638 
              5,785 
                 (5,401)
           14,543       
            Total current liabilities
148,523 
15,025 
52,960 
(48,126)
168,382       
Long-term debt
269,546 
160,206 
142,920 
(358,470)
214,202 
Other long-term liabilities and     
   deferred credits
2,058 
34,038 
55,512 
(13,536)
78,072       
Shareholders' equity:     
   Common stock
280 
1 
58,940 
(58,941)
280 
   Additional paid-in capital
305,901 
324,715 
335,618 
(660,333)
305,901 
   Retained earnings
4,413 
(70,450)
(11,603)
82,053 
4,413 
   Accumulated other      
      comprehensive income
6,279 
-      
-      
-      
6,279 
   Treasury stock, at cost
     (29,111)
                   -      
                   -      
                          -      
     (29,111)      
    Total shareholders' equity
 287,762 
      254,266 
   382,955 
          (637,221)
     287,762       
          Total liabilities and     
             shareholders' equity
$707,889 
$ 463,535 
$634,347 
$(1,057,353)
$748,418       
 

 

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

 
 
Nine months ended March 31, 2002
 
(In thousands)
Parent

Company
Guarantor

Subsidiaries
Non-Guarantor

Subsidiaries
Eliminations
 
Consolidated      Cash flows from operating     
  activities:     
    Net (loss) income
$(14,206)        
$ (12,709) 
$     7,245 
$     5,464 
$    (14,206)
   Reconciliation of net (loss)      
     income to net cash (used in)      
     provided by operating          activities:     
         Net change in operating      
             assetsand liabilities
(36,979)
118 
33,768 
1,321 
(1,772)
          Depreciation, depletion and     
             amortization
3,404 
9,472 
20,618 
-      
33,494 
          Change in deferred loss on                                 hedgingactivities, net     
             of tax
6,015 
-      
-      
-      
6,015 
          Equity earnings in      
             unconsolidated affiliates
8,685 
(6,505)
(8,523)
(2,681)
(9,024)
          Deferred income taxes and      
             other
      32,450 
                 142 
            (4,748)
           (4,104)
        23,740 
Net cash (used in) provided by     
   operating activities
        (631)
       (9,482)
            48,360 
                   -      
       38,247       Cash flows from investing     
   activities:     
     Purchases of property, plant      
       and equipment
(139)
(1,374)
(6,355)
-      
(7,868)
     Proceeds from sale of assets
42 
120 
4,855 
-      
5,017 
     Other
                -      
                  990 
              2,310 
                 -      
            3,300 
Net cash (used in) provided by     
   investing activities
                 (97)
               (264)
                    810 
                 -      
                  449       Cash flows from financing     
   activities:     
     Debt proceeds
167,904 
-      
-      
-      
167,904 
     Debt payments
(217,240)
-      
-      
-      
(217,240)
     Net change in affiliate notes
     39,426 
            9,746 
         (49,172)
                  -      
                  -       
Net cash (used in) provided by     
   financing activities
         (9,910)
           9,746 
         (49,172)
                  -      
      (49,336)      
Net decrease in cash and cash     
   equivalents
(10,638)
-      
(2)
-      
(10,640)      
Cash and cash equivalents -     
   beginning of period
         11,728       
                    16 
                         53 
                 -      
         11,797       
Cash and cash equivalents -     
   end of period
$     1,090  
$        16 
$              51 
$       -      
$     1,157 
 

 

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
 
Nine months ended March 31, 2001
 
(In thousands)
Parent

Company
Guarantor

Subsidiaries
Non-Guarantor

Subsidiaries
Eliminations
 
Consolidated      Cash flows from operating     
   activities:     
     Net (loss) income
$ (21,952)
$   (12,977)
$     22,529 
$     (9,552)
$   (21,952)
     Reconciliation of net (loss)       
      income to net cash used in     
      operating activities:     
          Net change in operating      
             assetsand liabilities
13,367 
7,108 
(42,812)
(4,441)
(26,778)
          Depreciation, depletion      
             andamortization
2,807 
9,596 
22,754 
-       
35,157 
                   Change in deferred loss on                    hedgingactivities, net     
                          of tax
1,872 
-      
-      
-       
1,872 
          Equity earnings in      
             unconsolidated affiliates
6,534 
(17,954)
(4,360)
10,631 
(5,149)
          Deferred income taxes and      
             other
   (16,743)
      (3,195)
          985 
      3,362 
    (15,591)
Net cash used in operating     
      activities
   (14,115)
   (17,422)
        (904)
         -      
    (32,441)      Cash flows from investing     
   activities:     
     Purchases of property, plant      
       and equipment
(181)
(1,954)
(11,862)
-       
(13,997)
        Proceeds from sale of assets
4,759 
6 
10,818 
-       
15,583 
    Other
           -      
          742 
                 8 
         -       
           750       Net cash provided by (used in)     
      investing activities
      4,578 
     (1,206)
     (1,036)
         -       
      2,336       Cash flows from financing     
   activities:     
     Debt proceeds
334,331 
-       
-       
-       
334,331 
     Debt payments
(304,703)
-       
-       
-       
(304,703)
     Cash dividends paid
(784)
-       
-       
-       
(784)
     Net change in affiliate notes
   (20,537)
    18,628 
        1,909 
        -       
          -             
Net cash provided by financing     
   activities
       8,307 
    18,628 
        1,909
         -       
    28,844       
Net decrease in cash and      
   cash equivalents
(1,230)
-      
(31)
-       
(1,261)      
Cash and cash equivalents -     
   beginning of period
       2,085
            17 
            88 
        -       
       2,190       
Cash and cash equivalents -     
   end of period
$        855 
$          17 
$         57 
$      -       
$         929 
 

 
**ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION**
GENERAL.  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, in our most recent Annual Report on Form 10-K which is on file with the Securities and Exchange Commission.
****
SEGMENTS.  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.  

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.    

OTHER FACTORS.  Our products and primary raw materials (particularly natural gas) are commodities, the prices for which may vary significantly from quarter-to-quarter.  These prices and the global supply/demand balance for our products do not necessarily change in relation to one another and may impact our performance in different ways.  In addition, quarterly results can vary significantly from year to year due to a number of other factors as detailed under "Forward Looking Statements" in this quarterly 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 MARCH 31, 2002 COMPARED TO THE THREE MONTHS ENDED MARCH 31, 2001**
OVERVIEW.  For the quarter ended March 31, 2002, we incurred a net loss of $5.0 million (or $0.19 per diluted share) compared to a net loss of $495,000 (or $0.02 per diluted share) for the same quarter during the prior year.  Net sales decreased to $94.7 million for the quarter ended March 31, 2002, from $147.5 million for the quarter ended March 31, 2001.  We incurred an operating loss of $9.1 million for the quarter ended March 31, 2002, compared to operating income of $1.2 million for the quarter ended March 31, 2001.  Earnings before interest, taxes, depreciation and amortization ("EBITDA") for the quarter ended March 31, 2002, were $13.4 million compared to $18.1 million for the quarter ended March 31, 2001.

NET SALES

OVERVIEW.  Our net sales decreased 36% to $94.7 million for the quarter ended March 31, 2002, from $147.5 million for the quarter ended March 31, 2001.  This decrease was primarily the result of lower sales prices for our nitrogen, DAP and potash products and lower sales volumes for our nitrogen products.

The following tables summarize our sales results by product categories for the three months ended March 31:

    
%  
2002
2001
Inc. (Dec.)
Net Sales (in thousands):    
   Nitrogen 
 $  50,469
$101,246
(50%)
   DAP 
24,538
25,430
(4%)
   Potash 
19,508
20,672
(6%)
   Other 
        179
        164
       9%      
       Net Sales 
$ 94,694
$147,512
    (36%)
 

    
%  
2002
2001
Inc. (Dec.)
Tons Sold (in thousands):    
   Nitrogen:    
       Ammonia 
162
238
(32%)
       Ammonium nitrate 
142
124
15% 
       Urea 
96
86
12% 
       Nitrogen solutions 
109
116
(6%)
       Nitric acid 
        2
      19
    (89%)
            Total Nitrogen 
511
583
(12%)     
   DAP 
186
185
1% 
   Potash 
226
223
1% 
 

    
%  
2002
2001
Inc. (Dec.)
Average Sales Price Per Ton:    
   Nitrogen 
$       99
$     174
(43%)
   DAP 
$     132
$     137
(4%)
   Potash 
$       86
$       93
(7%)     
 

NITROGEN.  Our nitrogen sales decreased 50% as a result of a 43% decrease in sales prices and a 12% decrease in sales volumes.  Prices for all of our nitrogen products declined due to market concerns that higher production levels brought on by reduced gas costs would negatively affect future supply/demand balances.  During the quarter ended March 31, 2001, nitrogen product prices were unusually strong due to capacity shutdowns by domestic producers amid industry-wide cost pressure caused by record high natural gas prices.  Additionally, as a result of low demand for nitrogen and high import levels last spring in the US, product inventory was carried over into this year and has negatively influenced product prices.

Ammonia sales prices decreased 51%, and sales volumes decreased 32%.   We operated our domestic ammonia plants at approximately 81% of capacity during the quarter ended March 31, 2002, as compared to 56% in the quarter ended March 31, 2001.  Sales prices and volumes were also negatively affected by reduced demand from industrial customers.  Increased production rates during the quarter ended March 31, 2002, replaced approximately 150,000 tons of ammonia purchased from third parties during the quarter ended March 31, 2001.

Ammonium nitrate sales prices decreased 28%, while sales volumes increased 15%.  The increase in sales volumes was primarily due to recaptured market share; however, unusually cold and wet weather conditions in our southeast US trade area negatively impacted demand.  We operated our ammonium nitrate facilities at approximately 87% of capacity during the quarter ended March 31, 2002, as compared to 83% during the quarter ended March 31, 2001.

Urea sales volumes increased 12%, while the average selling price decreased 37%.  During the quarter ended March 31, 2002, there was a more favorable relationship between natural gas prices and prilled urea prices than during the quarter ended March 31, 2001.  As a result, we had higher production rates and corresponding increases in sales volumes.  Nevertheless, this increase in sales volumes was partially offset by the absence of industrial sales of urea melt during the quarter as a result of the closure of Melamine Chemical Inc.'s facility in our Donaldsonville, Louisiana, complex.  During the quarter ended March 31, 2001, we sold approximately 29,000 tons of urea melt.  Our urea facility operated at 66% of capacity as compared to 51% in the quarter ended March 31, 2001.

Nitrogen solutions sales prices decreased 35%, and sales volumes decreased 6%.  In addition to the impact of general market conditions, nitrogen solutions sales prices were negatively impacted by an oversupply in the market caused by high levels of low priced imports, primarily from certain former Soviet Union countries.  To manage inventory levels, production was curtailed to 39% of capacity during the quarter ended March 31, 2002, as compared to 91% during the quarter ended March 31, 2001.

PHOSPHATES.  Our DAP sales decreased 4% as a result of a 4% decrease in sales prices.  While sales prices were lower as compared to the quarter ended March 31, 2001, the average sales price increased 6% from the quarter ended December 31, 2001, as the world supply/demand balance continued its improvement from late summer 2001 conditions.  Near the end of the March 31, 2002 quarter, DAP sales prices leveled off from the increases experienced during the preceding six months.

POTASH.  Our potash sales decreased 6% as a result of a 7% decrease in sales prices partially offset by a 1% increase in sales volumes. Sales volumes were negatively impacted during the quarters ended March 31, 2002 and 2001, by wet weather conditions. 

 

COST OF PRODUCTS SOLD
****
OVERVIEW.  Our cost of products sold decreased to $95.6 million for the quarter ended March 31, 2002, from $132.2 million for the quarter ended March 31, 2001.  As a percentage of net sales, cost of products sold increased to 101% for the quarter ended March 31, 2002, from 90% for the quarter ended March 31, 2001.  This increase was primarily the result of lower sales prices for our nitrogen, DAP and potash products partially offset by lower costs per ton for all products.  Our average domestic natural gas price for all operations, net of futures gains and losses, decreased 48% to $2.72 per MMBtu for the quarter ended March 31, 2002.

NITROGEN.  Our nitrogen costs per ton decreased 27% 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 46% to $2.73 per MMBtu.  In addition, we had lower costs related to third-party purchases of ammonia.  During the quarter ended March 31, 2002, we also had higher equity earnings at our joint venture ammonia plant in Trinidad, Farmland MissChem Limited ("Farmland MissChem") that contributed to the decrease in our nitrogen costs per ton.  Our portion of the earnings from Farmland MissChem was $1.5 million as compared to a loss of $488,000 during the quarter ended March 31, 2001. 

PHOSPHATES.  Our DAP costs per ton decreased 19% for the quarter ended March 31, 2002.  This decrease was primarily the result of lower raw material costs for ammonia and sulfur.

POTASH.  Our potash costs per ton decreased 7% for the quarter ended March 31, 2002.  This decrease was primarily the result of lower natural gas and electricity costs.

 

SELLING, GENERAL AND ADMINISTRATIVE

Our selling, general and administrative expenses decreased to $7.0 million for the quarter ended March 31, 2002, from $7.5 million for the quarter ended March 31, 2001.  This decrease was primarily the result of reduced goodwill amortization during the quarter.  As a percentage of net sales, selling, general and administrative expenses increased to 7% for the quarter ended March 31, 2002, as compared to 5% for the quarter ended March 31, 2001.

OTHER OPERATING EXPENSES

Our other operating expenses decreased to $1.1 million for the quarter ended March 31, 2002, from $6.6 million for the quarter ended March 31, 2001.  This decrease is the result of reduced idle plant costs at our nitrogen facilities.  Portions of our ammonia, nitric acid and urea production capacities were idled for various periods during the quarters ended March 31, 2002 and March 31, 2001, primarily due to the unfavorable relationship between product prices and natural gas prices.  However, significantly reduced natural gas prices during the March 31, 2002 quarter, permitted us to run our nitrogen facilities at a higher utilization rate than during the quarter ended March 31, 2001.

INTEREST, NET

Our net interest expense for the quarter ended March 31, 2002, decreased to $6.8 million from $7.0 million.  This decrease was the result of lower average interest rates under our revolving credit facility more than offsetting higher average debt balances and lower interest income during the quarter.

OTHER INCOME

Other income increased to $11.3 million from $5.5 million, primarily as a result of settling the defamation action we filed against Terra International, Inc. in August 1995.  We received $11.0 million from Terra's liability carrier during the quarter ended March 31, 2002.  During the prior-year quarter ended March 31, 2001, other income primarily consisted of gains on the sale of non-core real estate assets.

INCOME TAX EXPENSE (BENEFIT)

For the quarter ended March 31, 2002, our income tax expense was $432,000, as compared to  $120,000 for the quarter ended March 31, 2001.  Our income taxes for the quarter ended March 31, 2002 include the effect of lowering our estimated annual effective tax rate from 59% to 48%.

 
**RESULTS OF OPERATIONS - NINE MONTHS ENDED MARCH 31, 2002 COMPARED TO THE NINE MONTHS ENDED MARCH 31, 2001**
OVERVIEW.  For the nine-month period ended March 31, 2002, we incurred a net loss of $14.2 million (or $0.54 per diluted share) compared to a net loss of $22.0 million (or $0.84 per diluted share) for the same period during the prior year.  Net sales decreased to $318.6 million for the nine-month period ended March 31, 2002, from $403.9 million for the nine-month period ended March 31, 2001.  We incurred an operating loss of $20.9 million for the nine-month period ended March 31, 2002, compared to an operating loss of $22.6 million for the nine-month period ended March 31, 2001.  Earnings before interest, taxes, depreciation and amortization ("EBITDA") for the nine-month period ended March 31, 2002, were $27.8 million, compared to $20.4 million for the nine-month period ended March 31, 2001.

 

NET SALES

OVERVIEW.  Our net sales decreased 21% to $318.6 million for the nine-month period ended March 31, 2002, from $403.9 million for the nine-month period ended March 31, 2001.  This decrease was primarily the result of lower sales prices for our nitrogen, DAP and potash products and lower sales volumes for nitrogen.  These decreases were partially offset by higher sales volumes for our DAP and potash products.

The following tables summarize our sales results by product categories for the nine-month periods ended March 31:

    
%  
2002
2001
Inc. (Dec.)
Net Sales (in thousands):    
   Nitrogen 
 $183,985
$270,513
(32%)
   DAP 
76,958
77,366
(1%)
   Potash 
56,630
54,807
3% 
   Other 
        979
     1,194
    (18%)     
       Net Sales 
$318,552
$403,880
    (21%)
 

    
%
  
2002
2001
Inc. (Dec.)
Tons Sold (in thousands):    
   Nitrogen:    
       Ammonia 
567
672
(16%)
       Ammonium nitrate 
482
432
12% 
       Urea 
358
382
(6%)
       Nitrogen solutions 
250
270
(7%)
       Nitric acid 
      31
      46
    (33%)
            Total Nitrogen 
1,688
1,802
(6%)     
   DAP 
620
571
9% 
   Potash 
663
603
10% 
 

 
    
%  
2002
2001
Inc. (Dec.)
Average Sales Price Per Ton:    
   Nitrogen 
$     109
$     150
(27%)
   DAP 
$     124
$     136
(9%)
   Potash 
$       85
$       91
(7%)     
 

NITROGEN.  Our nitrogen sales decreased 32% as a result of a 27% decrease in sales prices and a 6% decrease in sales volumes.  Sales prices for all of our nitrogen products declined due to market concerns that higher production levels brought on by reduced gas costs would negatively affect future supply/demand balances.  During the prior year, nitrogen product prices were unusually strong due to capacity shutdowns by domestic producers amid industry-wide cost pressure caused by record high natural gas prices.

Our ammonia sales prices decreased 35% and sales volumes decreased 16%.  Sales volumes decreased because of lower demand from industrial customers due to a slowdown in economies worldwide. 

Ammonium nitrate sales prices decreased 14%, while sales volumes increased 12%.  Sales volumes increased primarily due to recaptured market share.

Urea sales prices decreased 21%, and sales volumes decreased 6%.  Sales prices decreased as a result of higher industry production levels during fiscal 2002, as well as excess industry inventories carried over from spring 2001.  Sales volumes decreased as a result of decreased granular urea sales due to our transfer of our granular urea facility back to its prior owner during the period, as well as decreased urea melt sales caused by Melamine Chemical, Inc.'s closure of its plant at our Donaldsonville, Louisiana, complex.  The decrease in sales volumes was partially offset by increased production and sales of prilled urea.

Nitrogen solutions sales prices decreased 27%, and sales volumes decreased 7%.  Sales prices and sales volumes decreased primarily as a result of higher producer inventory levels and increased import levels at low prices, primarily from certain former Soviet Union countries.

PHOSPHATES.  Our DAP sales prices decreased 9%, while our DAP sales volumes increased 9%.  While prices were down, world market conditions improved from late summer 2001 conditions and leveled off near the end of the nine-month period.

POTASH.  Our potash sales increased 3% as a result of a 10% increase in sales volumes, partially offset by a 7% decrease in sales prices.  The change in sales prices and volumes partially resulted from an increase in export sales, which typically have lower sales prices than domestic sales.  Domestic market conditions also negatively impacted prices.

 

COST OF PRODUCTS SOLD

OVERVIEW.  Our cost of products sold decreased to $309.8 million for the nine-month period ended March 31, 2002, from $389.9 million for the nine-month period ended March 31, 2001.  As a percentage of net sales, cost of products sold was 97% for the nine-month periods ended March 31, 2002 and March 31, 2001.  For all of our products, lower costs per ton were offset by lower sales prices.  Our average domestic natural gas price for all operations, net of futures gains and losses, decreased 33% to $3.02 per MMBtu for the nine-month period ended March 31, 2002.

NITROGEN.  Our nitrogen costs per ton decreased 24%, 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 32% to $3.03 per MMBtu.  In addition, we had lower costs related to third-party purchases of ammonia and lower maintenance and labor costs than those incurred during the nine-month period ended March 31, 2001, associated with maintenance shutdowns at our Yazoo City, Mississippi, and Donaldsonville, Louisiana, facilities.  During the nine-month period ended March 31, 2002, we also had higher equity earnings at Farmland MissChem that contributed to the decrease in our nitrogen costs per ton.  Our portion of the earnings was $8.5 million as compared to $4.4 million for the nine-month period ended March 31, 2001.

PHOSPHATES.  Our DAP costs per ton decreased 19% for the nine-month period ended March 31, 2002.  This decrease was primarily the result of lower raw material costs for ammonia and sulfur.

POTASH.  Our potash costs per ton decreased 3% for the nine-month period ended March 31, 2002.  This decrease was primarily the result of lower natural gas costs.  These lower costs were partially offset by higher electricity costs and higher per-ton costs for labor and maintenance as a result of lower production.

 

SELLING, GENERAL AND ADMINISTRATIVE

Our selling, general and administrative expenses decreased to $20.6 million for the nine-month period ended March 31, 2002, from $23.5 million for the nine-month period ended March 31, 2001.  This decrease was primarily the result of reduced goodwill amortization during the nine-month period ended March 31, 2002.  In addition, the prior year included costs related to benefits paid under an early retirement program and severance costs related to a reduction in force.  As a percentage of net sales, selling, general and administrative expenses were 6% for the nine-month periods ended March 31, 2002 and 2001.

OTHER OPERATING EXPENSES

Our other operating expenses decreased to $9.0 million for the nine-month period ended March 31, 2002, from $13.0 million for the nine-month period ended March 31, 2001.  This decrease is the result of reduced idle plant costs at our nitrogen facilities.  Portions of our ammonia, urea and nitric acid production capacities were idled for various periods during the nine-month periods ended March 31, 2002 and 2001, primarily due to the unfavorable relationship between product prices and natural gas prices.

INTEREST, NET

Our net interest expense for the nine-month period ended March 31, 2002, increased to $21.4 million from $21.3 million.  This increase was primarily the result of higher average debt balances and costs associated with the amendment of our revolving credit facility.  These increases were partially offset by lower average interest rates under our revolving credit facility.

OTHER INCOME

Other income increased to $15.2 million from $7.8 million, primarily as a result of settling the defamation action we filed against Terra International, Inc. in August 1995.  We received $11.0 million from Terra's liability carrier during the nine-month period ended March 31, 2002.  During the nine-month period ended March 31, 2001, other income primarily consisted of gains on the sale of non-core real estate assets.

INCOME TAX EXPENSE (BENEFIT)

For the nine-month period ended March 31, 2002, our income tax benefit was $13.0 million, as compared to an income tax benefit of $14.0 million for the nine-month period ended March 31, 2001.  These income tax benefits are primarily the result of our net losses and permanently reinvested foreign earnings from our investment in Farmland MissChem, partially offset by non-deductible goodwill amortization.  Our current income tax benefit is based on an estimated annual effective tax rate of approximately 48%.
** 

LIQUIDITY AND CAPITAL RESOURCES**
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.  This Facility matures on November 25, 2002.  It became a current liability on our balance sheet for financial reporting purposes in the quarter ended December 31, 2001.  We are currently exploring refinancing alternatives and believe that we will be able to refinance the Facility at or prior to maturity.  We have engaged Credit Suisse First Boston Corporation to help us evaluate such alternatives.  However, we cannot guarantee that we will be able to obtain new financing or the same amount, and such financing is likely to contain terms, particularly interest rates and fees, not as favorable as the Facility's.

At March 31, 2002, we had cash and cash equivalents of $1.2 million, compared to $11.8 million at June 30, 2001, a decrease of approximately $10.6 million.

OPERATING ACTIVITIES

For the nine-month period ended March 31, 2002, our net cash provided by operating activities was $38.2 million, and included a $26.4 million refund of federal taxes pursuant to the recently enacted Job Creation and Workforce Assistance Act of 2002.  Net cash used in operating activities was $32.4 million for the nine-month period ended March 31, 2001.

INVESTING ACTIVITIES

Our net cash provided by investing activities was $449,000 for the nine-month period ended March 31, 2002, and included $5.0 million in proceeds from the sale of non-core assets and $3.3 million primarily related to the collection of a note for the sale of non-core real estate.  These proceeds were partially offset by $7.9 million in capital expenditures that were for normal improvements and modifications to our facilities.  Our net cash provided by investing activities was $2.3 million for the nine-month period ended March 31, 2001, and included $15.6 million in proceeds from the sale of non-core assets partially offset by capital expenditures of $14.0 million that were for normal improvements and modifications to our facilities.

FINANCING ACTIVITIES

Our net cash used in financing activities was $49.3 million for the nine-month period ended March 31, 2002, which reflected net debt payments.  The $11.0 million cash settlement from the Terra lawsuit, plus the receipt of $26.4 million during the quarter from a refund of previously paid federal taxes pursuant to the recently enacted Job Creation and Workforce Assistance Act of 2002, allowed us to repay debt in the quarter.  Our net cash provided by financing activities was $28.8 million for the nine-month period ended March 31, 2001, which reflected net debt proceeds of $29.6 million and $784,000 in cash dividends.

Our $200.0 million 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 March 31, 2002, we had borrowings outstanding in the amount of $122.8 million, and letters of credit outstanding in the amount of $1.9 million that lowered our availability under the Facility.  We had $66.8 million available under the Facility at March 31, 2002, in addition to cash on hand of $1.2 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 volatile conditions in our industry and the natural gas markets at that time.  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 was reduced by 50 basis points for the December 31, 2001, quarter and all quarters thereafter as long as we continue to meet certain covenants.  We were in compliance with all covenants as of March 31, 2002, and anticipate being in compliance with all covenants at June 30, 2002.  Our weighted average interest rate under the Facility was 5.40% for the quarter ended March 31, 2002, and 6.26% for the nine-month period ended March 31, 2002.  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.

In August 1997, we issued $14.5 million in industrial revenue bonds, a portion of which were tax-exempt, to finance the development of our new phosphogypsum disposal facility at our Pascagoula, Mississippi, DAP manufacturing plant.  On April 1, 1998, we issued $14.5 million in tax-exempt industrial revenue bonds, the proceeds of which were used to redeem the initial industrial revenue bonds issued in August 1997.  The bonds issued on April 1, 1998, mature on March 1, 2022, and carry a 5.8% fixed rate.  The bonds may be redeemed at our option at a premium from March 1, 2008, to February 28, 2010, and may be redeemed at face value at any time after February 28, 2010, through the maturity date.  The bonds are the obligation of our subsidiary, Mississippi Phosphates Corporation, but are guaranteed by Mississippi Chemical Corporation.

On November 25, 1997, we issued $200.0 million of 7.25% Senior Notes (the "Senior Notes") due November 15, 2017.  The holders may elect to have the Senior Notes repaid on November 15, 2007.  The Senior Notes were issued under a $300.0 million shelf registration statement filed with the Securities and Exchange Commission in November 1997.

Based on natural gas and product market prices as of the date of this filing, and our current  natural gas 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 the maturity of our Facility in November 2002, by which time we anticipate having our Facility refinanced as mentioned above in this section.  Natural gas prices remain volatile, and if they  increase without corresponding increases in the market prices for our products, our natural gas costs will have a material adverse impact on our liquidity and results of operations. 
** 

OUTLOOK**
Despite low worldwide grain inventories, compared to normal historical levels, there has been only minor price improvement in farm commodities.  Low farm commodity prices have translated into several consecutive years of reductions in the number of worldwide acres planted, which has contributed to lower consumption of nitrogen, phosphate, and potash products.  In the fourth quarter of fiscal 2002, we expect to recapture a portion of the sales volumes delayed during the third fiscal quarter due to the adverse effect of weather conditions in our trade area.  Nitrogen product prices will be impacted by the progression of the planting season in the US and the amount of US nitrogen production that remains curtailed due to market conditions. In the recent weeks prior to the filing of this report, several US nitrogen plants scaled back operations in response to rising natural gas prices, slow demand and low product prices.  Natural gas prices will continue to play a major role in determining how we operate our nitrogen plants as we try to match production to market conditions.

The planting intention report from the USDA on March 31, 2002, showed increased corn plantings in the US this spring, which should help increase nitrogen demand.  Corn is a large user of nitrogen fertilizer, accounting for approximately 45% of all nitrogen consumed by crops in the US each year.  However, the absence of a new federal farm bill may affect stated planting intentions due to the lack of certainty regarding government support payments.  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 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. 

Significantly higher natural gas storage levels, compared to fiscal 2001, should help moderate natural gas pricing as the year progresses, and this should improve our nitrogen production cost compared to fiscal 2001.  Although nitrogen product prices have increased slightly since March 31, 2002, they are currently at low levels as reflected in our results for the March 31, 2002 quarter.  Additionally, if natural gas prices increase, it will have a material adverse impact on our performance if nitrogen product prices do not experience corresponding increases.  

On April 19, 2002, the Nitrogen Solutions Fair Trade Committee (the "Committee"), a coalition of U.S. producers of nitrogen solutions consisting of Mississippi Chemical Corporation, Terra Industries Inc., and CF Industries, Inc., filed an antidumping petition against nitrogen solutions from Belarus, Lithuania, the Russian Federation, and Ukraine.  The Committee filed the antidumping petition with the U.S. International Trade Commission and the U.S. Department of Commerce after developing facts that led the Committee to believe that nitrogen solutions from these four countries is being sold in the U.S. at unfairly low prices and is materially injuring the domestic nitrogen solutions industry.  The Committee has asked the United States government to move quickly with the case to limit further damage to the domestic nitrogen solutions industry.

Although we expect the firming of international phosphate markets to continue, prices have leveled off from the increases experienced since January 2002.  Since a majority of our DAP is sold into export markets by PhosChem, the PhosChem contracts with China for major sales through calendar 2002 will be positive for our phosphate segment.  In the long-term, the accession of China to the World Trade Organization is positive for the DAP industry.  During the last two growing seasons, farmers have reduced the application rates of phosphate as well as 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 for these nutrients.  Finally, the performance of our potash segment will depend on increases of currently low potash sales prices and the continued improvement of energy costs and ore grades experienced during our third fiscal quarter.  

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 stocks, 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, which is on file with the Securities and Exchange Commission.  

To manage our natural gas price risks, we enter into derivative transactions as the opportunity arises.  These derivative transactions may consist of futures contracts, commodity swaps, or similar derivative financial instruments that mature at various dates and are related to the price of natural gas.  We do not hold or issue derivative financial instruments for trading purposes.  We maintain formal policies with respect to entering into and monitoring derivative transactions.  Our derivative transactions are intended to hedge our future natural gas costs.  The volume of natural gas hedged varies from time to time based on management's judgment of market conditions, particularly natural gas prices and nitrogen product prices.  

We prepared a sensitivity analysis to estimate our market risk exposure arising from our open natural gas derivative instruments.  At March 31, 2002, the fair value of open positions was calculated by valuing each position using 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 derivative instruments.  We estimate that this adverse change in prices would have reduced the fair value of our open positions by approximately$1.8 million at March 31, 2002 (see Note 5 to our consolidated financial statements included in this report).

 
**PART II.  OTHER INFORMATION**
Item 6.
Exhibits and Reports on Form 8-K.   
(a)   Exhibits.   
        See Index of Exhibits on page 33.   
(b)      No reports on Form 8-K have been filed for the quarter for which this           report  is filed.  
 

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:     April 30, 2002                   
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 the Company'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 the Company'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 the Company'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 the Company's 7 1/4% debt securities due November 15, 2017; filed as Exhibit 4.3 to the Company'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.
*
 

 
**EXHIBIT NUMBER**DESCRIPTION**PAGE NO.   
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 the Company'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 the Company'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 the Company'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.
*
_______________________ 

     (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 from the second and third paragraphs of Article IX, and an application for confidential treatment has been filed separately with the Commission.

      
**EXHIBIT NUMBER**DESCRIPTION**PAGE NO.   
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 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. (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 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.
*   
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 the Company's quarterly report on Form 10-Q for the quarter ended March 31, 2001, SEC File No. 001-12217, and incorporated herein by reference.
*
_________________________ 

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

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

           

           

 
**EXHIBIT NUMBER**DESCRIPTION**PAGE NO.   
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; filed as Exhibit 10.7 to the Company's quarterly report on Form 10-Q for the quarter ended September 30, 2001, 2001, SEC File No. 001-12217, and incorporated herein by reference.
*   
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 the Company'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 the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 1999, SEC File No. 001-12217 and incorporated herein by reference.
*   
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 the Company's $200 million revolving line of credit, filed as Exhibit 10 to the Company'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 the Company's $200 million revolving line of credit, filed as Exhibit 10.9 to the Company'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 the Company'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 the Company'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 the Company'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 the Company's Quarterly Report on Form 10-Q for the quarter ended December 31, 1999, SEC File No. 001-12217, and incorporated herein by reference.
*   
 
**EXHIBIT NUMBER**DESCRIPTION**PAGE NO.   
10.16
Mississippi Chemical Corporation Nonemployee Directors' Deferred Compensation Plan; filed as Exhibit 10.10 to the Company'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 the Company'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 the Company'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 the Company'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 the Company'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 the Company's Form S-8 Registration Statement filed December 21, 1995, SEC File No. 33-65209, and incorporated herein by reference.

*
* Incorporated by reference.******************************