Good morning, and welcome to the Second Quarter 2014 Earnings Release Conference Call for FMC Corporation. [Operator Instructions] I would now like to turn the conference over to Ms. Alisha Bellezza, Director of Investor Relations for FMC Corporation. Ms. Bellezza, you may begin.

Thank you, Moses. Good morning, everyone, and welcome to FMC Corporation's second quarter earnings call. With me today are: Pierre Brondeau, President, Chief Executive Officer and Chairman, who will review our quarter performance, business segment results and provide an update on our 2014 outlook; and Paul Graves, Executive Vice President and Chief Financial Officer, who will present select financial results. Pierre will conclude the call with an update on our separation activities and on our Vision 2015 goal. Following his comments, we will be joined by Mark Douglas, President, FMC Agricultural Solutions; Ed Flynn, President, FMC Minerals; and Mike Smith, Vice President and Global Business Director, FMC Health and Nutrition, to address your question. Today's discussion will include forward-looking statements that are subject to various risks and uncertainties concerning specific factors, including, but not limited to, those factors identified in our release and in filings with the Securities and Exchange Commission. Information presented represents our best judgment based on today's information. Actual results may vary, based upon these risks and uncertainties. Today's discussion will focus on adjusted earnings for all income statement and EPS references. A reconciliation and definition of these terms, as well as other non-GAAP financial terms that we may refer to during today's conference call are provided on our website. Our 2014 outlook statement, which provides guidance for the full year and the third quarter of 2014 can also be found on our website. I will now turn the call over to Pierre.

Thank you, Alisha, and good morning, everyone. In our release, you saw that we generated $988 million in revenue, an increase of 13% over the second quarter of last year. Adjusted operating profit increased to $203 million, a 10% increase compared to last year, and we delivered $1.01 in adjusted EPS, an increase of 9% over last year. The Health and Nutrition and Minerals segments performed largely as expected. Results were strongly ahead of the second quarter last year. As you already know, compared to the original expectation, the effects of poor weather conditions negatively impacted our Agricultural Solutions segment in the first half of the year. Dry conditions in part of Brazil reduced sales to the sugarcane segment, and prolonged cold in North America led to different patterns of crop protection use. Despite this, the business delivered above-industry growth, with segment earnings and revenues higher than the second quarter of 2013. Second quarter sales in Agricultural Solutions were $531 million, a 20% increase over the second quarter of 2013. Segment earnings were $131 million, up 5% over last year. Segment margin was impacted by changes in product mix, unfavorable foreign exchange and a planned increase in business spending. We chose to continue to increase our sales and technology investment, despite these temporary pressures on our earnings growth. Within Agricultural Solutions, all regions show year-on-year growth in revenue. In North America, the unusually cold and prolonged winter led to later than usual plantings. This was followed by a very strong early growing period, with lower than normal pest pressures, which is leading to forecast a very strong yield in both corn and soybean. All of these factors combined have created unusual market condition and some challenges for the crop protection industry. For example, the delayed planting of corn this spring…

Thanks, Pierre. Today, I'll focus on a few notable items in the quarter, including foreign exchange impacts and cash generation. I'll also update you on our capital deployment plans for the rest of the year. Movements in the Brazilian real and multiple Asian currencies adversely impacted adjusted earnings on a year-over-year basis. In addition, the greater volatility within currencies has led to higher hedging costs versus last year. Our consolidated businesses, these unfavorable currency movements and related costs reduced adjusted EPS compared to last year by approximately $0.05 in the quarter and $0.10 in the first half. For the first half of 2014, cash provided by operating activities was $149 million versus $248 million in the prior year. Much of the lower cash generator was due to lower EBIT from Ag Solutions in the first quarter and higher receivables balances, again, due to our Agricultural Solutions. As we previously highlighted, later timing of sales in North America and a changing crop mix, especially in Brazil, is resulting in a different receivables collection pattern than prior years. So as a result, we expect a greater waiting of cash flow generation to the second half of the year compared to last year. We remain focused on increasing our operating cash flow, and we continue to roll out working capital improvement projects across the businesses. We believe we're on track to generate approximately $400 million of cash from operations, before separation costs. Capital additions in the quarter were approximately $46 million. Spending continues to be primarily associated with construction of the Thailand MCC facility, which is progressing well and remains on track to begin commercial sales in early 2015. We've also focused capital resources on the construction of a new gas pipeline in Argentina. This pipeline will provide a more economical and safer transport of natural gas, up the mountain to our processing facility. We anticipate completion by the end of the year, with benefits increasing our earnings starting in 2015. Finally, while Pierre will provide more details on the separation, let me note that, in the quarter, we incurred approximately $14 million in separation costs. And with that, I will turn the call back to Pierre.

Let me now update you on the status of the separation. We have completed the initial organizational design for both companies and are working on project planning and legal entity's credit [ph]. Regarding the costs to complete the separation, we expect approximately $100 million to $130 million of onetime costs. These costs are in line with costs seen in another companies undergoing similar separation processes. Once the separation is complete, we expect additional ongoing corporate expenses to total approximately $25 million across the 2 entities. These are mainly associated with supporting an additional publicly traded company. I will now update you on progress towards meeting the goals of our Vision 2015 plan. As you recall, the Vision 2015 strategic plan set a number of goals that reflected our objective of delivering to shareholder returns that we believe reflected the quality of the FMC portfolio. Also a combination of lost -- by the middle of 2014, we can demonstrate tremendous progress against these goals. We have met or exceeded our original targets for return on capital and capital return to shareholders. We remain on track to achieve our organic revenue targets. Our target for EBIT and EPS offer the greatest challenge to this. Despite our Ag business significantly outperforming against the plan and our core Health and Nutrition segment performing in line with the targets set forth, there is currently a gap to our 2015 EBIT target. The reason for this can be explained by a few factors that are largely outside of our control. First, related to Minerals. Soda ash pricing is not as high as we had forecasted, and the Argentinian peso to U.S. dollar exchange rates is not in line with where our fundamental projection should be. These 2 factors alone account for a large portion of the…

[Operator Instructions] Okay. We do have a -- your first question comes from the line of John McNulty with Crédit Suisse. John P. McNulty - Crédit Suisse AG, Research Division: So when I look at the guidance for the back half of the year, and in particular, look at the weighting at how it kind of sequences, the fourth quarter, obviously, is going to be having to carry a lot more weight than it normally does. And I guess, I'm wondering, how much of that kind of back end-loaded guidance is really tied to stuff that you have complete control over versus the markets moving in maybe a direction you anticipate or hope, but you don't necessarily control.

Yes, I would say that, today, and I would ask Mark to give more color to it, with a specific product discussion. I would say that a large part of the forecast we are making for the quarter depends upon things we are controlling. So we are looking at a normal fourth quarter from a weather standpoint. And most of the growth is coming -- and I could pretty much put 3 buckets into the growth. First, the first bucket would be mix. Our forecast is, today, with products which are much more differentiated, less third-party project than we did last year. So we have a much stronger mix in the fourth quarter. The other bucket would be, as we have proven, we've been able to grow our market share in soybean. And this soybean market share is forecasted to -- market share gains forecasted to continue for us. Together with a significant, as mentioned in the script, significant new product launch that we are seeing -- are getting very good reception right now in Latin America and in Brazil. And the third bucket will be we are very much seeing the benefit from our newly structured market access, for example, in Argentina. There is also one element, which we do not control, but we're just expecting no major change. If you remember, last year, we got very negatively impacted in the fourth quarter in our ag business by FX. We are not planning any major swing in the fourth quarter of this year around FX, which would create a significant year-on-year benefit. Mark, if you want to add anything around the specificity?

Yes, Pierre, I think, the -- and John, I know you know the market pretty well down there. I think, the piece I would add is the focus we've had in not only Brazil in terms of expanding market access through co-ops in distribution where, traditionally, we've had a lower share. We've put commercial people down on the ground, especially in the South of Brazil, where we're starting to see traction now with the products that we sell to a lot of the mega growers going through distribution. That really wasn't in place last year at this time, so there's a push there that you'll see. I would also that add that the market access outside of Brazil is paying off. Pierre just mentioned Argentina. I think, you know that we had a very good season in North America with our pre-emergent herbicides for glyphosate resistance. We're seeing exactly the same sort of acceleration in Argentina. We have the same brand name, the Authority brand. A lot of the technology used in North America is now being used in Argentina, so that's an accelerated market that we have, which should give confidence that we continue to grow in the soy area. And then, a lot of the smaller countries in Latin America that are extremely high value with specialty crops. We now have new market access in Ecuador, where we didn't have it this time last year, and we've expanded our presence in Chile and Peru. So all in all, when I look at Latin America, there are a number of things that are in our control and we feel very confident about putting those new technologies into the marketplace. John P. McNulty - Crédit Suisse AG, Research Division: Great. And then, just as the follow-up question. With regard to the pipeline that you're putting through, it sounds like, in your Lithium platform, can you walk us through how that changed the profitability and how we should be thinking about the margin progression, from ex pipeline to with pipeline?

Yes, first. We are expecting the pipeline to be in place toward the back end of the year, the back end of the fourth quarter. So we will see a yield impact this year. I would qualify the benefit in EBIT about the mid single-digit million dollar benefit over a year.

Your next question comes from the line of Kevin McCarthy with Bank of America Merrill Lynch.

I was wondering if you could speak to your contribution margins in the Ag business. It looks like you did have a nice sales growth of $89 million on a year-over-year basis, but about $6 million on the profit side, so maybe 7% incremental margin there. You mentioned FX. Perhaps, you can kind of walk us through some of the math there?

Yes. Same thing. I'll give you a view. And then, I'll get Mark to get into the specific. Let's put, first, the 2 things which are very concrete. First, FX went against us in the business in the second quarter. And the second aspect is the fact that we decided not to slow down, we have faith in this business, in our product development access, so we have decided to continue to invest in technology and selling. So we had a negative FX impact and increased investments into the business. But really, the main story is a mix story. First of all, as you know, we do have a very strong position in sugarcane in Brazil. Those are very differentiated product, high-margin products. And with the drought, we saw much less of these products than we were expecting. Second of all, in North America, as I just told in the script before, it was very different pattern from what we were expecting from the mix of product and the mix of pre-emergent versus post-emergent product. This also, within those high-margin products, there is some product with much higher margin than others, even all of those are differentiated. It went against us. So even in our high-margin products, we saw a lower sales of the very differentiated high-margin product. Now there is also a phenomenon which happened, and I unfortunately have to admit against what we would have liked. As you know, we have very sales-driven organization. And when they recognized that we were losing ground on the EBIT, they very aggressively went at selling products, where customers, because of our strong relationship, all things would be equal, would be willing buying from us rather than competition. But those quick sales are mostly of low differentiation or third-party product, which do not carry at all the same margins as our regular products. So we had a very strong push in Latin America, to some extent in North America, of products. I would not or we would not have pushed that hard to get those products in the market if we would have a full understanding of what was going on. So it was a way from -- we have a very strong, very sales-driven organization, and they were committed to an EBIT and they went for it. Maybe the way we were hit was with the mix, which would not be the one we would have chosen. So when you put those together, it created a very strong top line growth. There is places where we gain market share. We talked about it. I think, Authority is one of the brands where we have strong market share, so there is some very good reasons for the top line growth. But the big story behind -- beyond FX and investment in the business is a big mix shift, which we will control much better in the next couple of quarters. Mark, do you want to add something?

Yes. The only thing I would add, Kevin, is -- well, Pierre just touched on the business spending. I think, it's important to recognize that, that business spending is primarily based around research. I think, a lot of people know that we're investing in research for the new active ingredients that we're bringing through that will come through to the end of the decade. It's important to recognize that once we start that work and we get into the chronic talks work and we get into the regulatory side, we can't slow that down. So that's been the major investment when it comes to the business spend side.

It's really helpful color from both of you. As a second follow-up question maybe for Paul. Your DSO declined about 11 days sequentially. Can you update us on some of the initiatives on trade working capital. How much lower do you think you can take that metric? And what would be an appropriate equilibrium target for you?

Sure. Clearly, the business is really driven by, under the working capital targets, really driven by ag. And some of the moving pieces that we have going on Ag at the moment, we touched upon the North American sales patterns being a little different. The sales being made later in the quarter changes the year end receivables balances that we would normally have. And in Latin America, particularly in Brazil, we sell on crop terms, and so when you get a different mix of crop terms, and particularly when you move from the very short payment periods of sugarcane to the much longer payment periods of soybean and cotton, you start to get a very different pattern emerging. And what I would say is we look at a few key metrics, as well as DSO. We do look at industry terms and to make sure that we are not selling on any different terms to the rest of the industry. And we also look at collection rates and past due and default rates. And all of those things are back in line with where they've always been historically. So we're not seeing any major shifts. I think, to Pierre's point around some of the mix challenges that we had in the second quarter, I think, what we believe is that there is an opportunity around the DSO to be somewhat more differentiated about the terms we offer for different products that we're selling to our customers. We also think there are opportunities in some of our other businesses. In Health and Nutrition, we have some opportunities, for sure, around inventory levels in that business and we have some aggressive programs in place. So you put all those pieces together, we're still working through all this. As you can imagine, particularly in ag, moving the needle in working capital, when you have very long-dated terms and you're kind of cross growing seasons in different regions, you don't move things quickly, but we're pretty comfortable with the progress we're making so far. We recognize we need to start showing that in the cash flow numbers, but we're pretty confident that we're on the right track.

Your next question comes from the line of Dmitry Silversteyn with Longbow Research.

A couple of questions. If you -- I'm just trying to understand your outlook statement for, particularly in the ag business versus where you thought it would be 3 months ago. It looks like, at least revenues in the second quarter, you did a little bit better, but if you sort of can contrast and compare your view about the ag market in the second half of the year now, versus what it was 3 months ago?

I don't think that we have a major change in the view, Dmitry, while looking at the market. I think, the first quarter, we -- the year, the year is very much tainted by the first and second quarter. First quarter, sales were down 6%, EBIT was down 26%. In the second quarter sales were up 20%, and EBIT was only up 5%. So when you have such a start of the year, when you get a penalty and it's all weather-driven, and I would tend to admit, at the end of the first quarter, we misread the impacts of the weather on the second quarter. We thought we had a good handle on it and it was much more -- I mean, a couple of the other [ph] companies fell into the same trap as we did. So we had a changing view of the second quarter as we were going through the second quarter. But now, getting into the second quarter and -- sorry, the third quarter and the fourth quarter, we have kept pretty much the same view. The fourth quarter, we are believing will be very strong from a mix standpoint. We are looking at top line growth but very strong from a mix and point, where we are targeting sales and where we are forecasting sales with these good product. And the third quarter also we're showing improvements. So mid single-digit growth rate for the third quarter and high-teens for the fourth quarter, all driven by Latin America with a very strong mix, related to the kind of numbers we are showing. But we are forecasting just a normal back end of the year, nothing special around acreage or nothing particularly changed, or nothing special around the weather.

Got it. Okay. Switching gears to the Minerals part of the business. Can you talk about the sort of the pricing trends in the ANSAC business in Latin America and Asia. And also, there's been, as I'm sure you're aware, a couple of announcements of capacity expansions in soda ash or at least plants in Wyoming area from your competitors. So I was wondering how sort of how you look at the market now, with after several years of no capacity additions of any size, just de-bottlenecking. You actually do have some CapEx project starting up. And how does that impact your decision on bringing the rest of Granger online, in terms of timing on cost or whatever you can share with us?

Sure. So pricing, we had pricing stability in the low single-digit percent in domestic in North America. And pricing, I would say, stability in Latin America and good pricing traction, with double-digit percent increase in Asia. Now we didn't get the full benefit of this double-digit pricing increase in Asia, because the mix was a bit unfavorable. Pricing in Asia remains still lower than Latin America. And true, in fact, we had more sales in Asia than we had in Latin America. So the mix was not as good. But certainly, we've seen some firming of the pricing in Asia. Now still, for next another couple of quarters, until we understand better, we're not going to keep on forecasting a continuation of this price, but the quarter was robust at -- and stable. And Asia is the place where we saw the highest increase. We believe, the pricing situation, if we look at the next couple of years, is firming up in Asia because there is no major capital spending which are forecasted in Asia. And we start to see the demand and supply balance getting better. The capital spending, I think, you're mentioning about other announcements from my colleagues at Solvay. I suppose, that's the one you mentioned, which we see more as a de-bottlenecking than truly a capacity increase. As you know, when you produce de-bottleneck plants in Wyoming, with natural soda ash, you are at a very low pricing. So usually, it's not a very big issue to place those volumes. And the amounts are not such that they are changing the supply-demand pattern. Ed, you want to add something?

Yes. I would add, if you recall, Solvay also had announced that they shut down operations in Portugal, and that is actually more of a decrease than the roughly 150,000 tons they're going to bring on in Green River. In terms of that additional capacity, as it relates to the overall market, it's about 0.5% of global market demand, so we don't think it will have much of an impact. And there has been, in the last year or so, about 1.5 million tons of shutdowns that actually have occurred across the globe. So net-net, supply has actually been decreasing of capacity, that has currently been on line. And I think, the second part of your question Dmitry, was related to Granger, and we have experienced great success in the Manufacturing Excellence arena. And so while we've done pre-engineering work for the Granger facility, I can't go to Pierre and ask to make an investment until I can assure him that I've really been able to get everything I can out of the assets that I currently have in place.

Thanks, Ed. So in summary, we are, I would say, very cautiously optimistic around pricing, with stability in Latin America and North America, and strengthening in Asia. As Ed said, we are focusing capacity expansion through de-bottlenecking and we are seeing our Manufacturing Excellence is still giving us opportunities. I didn't share, I don't think I would be comfortable making the decision around a very large investment at this stage of the corporation. We are still looking at a separation. And I think it's a decision which will be better made by the business when acting as a standalone business.

Your next question comes from the line of Frank Mitsch with Wells Fargo.

Pierre, that almost begs the question as to who will Ed be asking about that capital allocation project, or when might we find out when the CEO comes. And actually, more broadly, regarding this $130 million -- I'm sorry, $100 million to $130 million spending target for the cost of the separation, which you indicated was in line with other sort of separations out there. How should we think about the timing of that? Very little has been spent -- well, not very little, 15% has been spent so far. But how should we think about the timing of that? And what are the big buckets that accounts for that $100 million to $130 million?

Certainly. So about who will be making the decision, we are still in interview process and interviewing candidates, and I would like to say that I have been meeting with very high-quality candidates today. So have a -- we are down to a handful of high-quality candidates today. And as soon as we've crossed the bridge of deciding who it is, you will be -- you guys will be the first to know. We'll put an announcement out. From the timing, I think, we still believe, it's a very complex process. The timing for a separation is always hard to predict, but we have no reason to believe that we will not stay within the timeframe we've announced, which was the first half of 2015. The spending for a separation, I would say, if you think about in between now and the separation, I would say the bulk of the spending will be happening in the next 6 months. That's really where we will have a large part of the spending. Spendings, if I look at the big bucket, I'm going to ask Paul to help me, but certainly, IT is definitely one of the big buckets we do have today. Tax is another parts of the -- those are the big hitters across the corporation.

And they're the 2 big ones, and there's obviously the external consultant costs, which is all around managing the project, and legal costs, consultant costs, bankers' fees. All the wonderful third parties that are willing to come and help us do this, they don't do it for free unfortunately. They're the big bucket.

Yes. So external help, we would call that IT and taxes would represent maybe 80% of your costs.

In that range, yes.

All right. Great. And that's over the next 6 months. And one of the things that you mentioned with respect to Vision 2015, and coming short was on the M&A side. I guess, it's been about a year since you did the Epax transaction. Can you update us on how that's going in the integration and the accretion that you're seeing there?

Yes. The integration is going well. The plant is operating, where they even have customers. I think, the -- so we are very pleased with where we are. It's accretive this year. The key question for us, and when I talk about Vision '15 and ramp up is, there is a base business, which we got with Epax, but there is all of the creation of this new business with the new manufacturing process and the new plant for the high-concentration, high-purity, either for pharmaceutical or for the high-concentration nutraceutical. That is really for us what will differentiate a decent acquisition from a great acquisition. So really, if I want to think about, today, very pleased, nothing wrong with we've done, good results. I'm feeling quite good with our new product line, but what will make it a great acquisition is how much progress we're going to make with the new Seal Sands plant and the high-concentration hydrology product. That's to be seen in the next, I would say, 12 months.

The next question comes from the line of Laurence Alexander from Jefferies.

This is George D'Angelo sitting in for Lawrence this morning. Can you give some color on the comments around glyphosate resistance. What regions are you guys seeing the most interest in those types of products?

Yes, George, this is Mark. First and foremost, North America is the market where we're seeing the most spread of glyphosate resistance, not only in terms of acreage but in terms of types of weeds. So that's a market where our sort of venture is on base products, the Authority brands are taking share and doing very well. Secondary to that, we're seeing the resistance in Argentina, as I talked about earlier. That's another large soy market and a market that we're focused on. Also outside of glyphosate, we do see resistance, insect resistance in Brazil growing, so we'll have opportunities there with our range of insecticides. Overall, it's been an important market for us. It will continue to be as we go into the next few seasons. Resistance is continuing to grow, not only in North America, but down in Latin America as well. And not only in Brazil, but Argentina, so an important market.

Okay. And any update on the JV with Chr. Hansen. What kind of products that might be yielding?

Yes, thanks for asking about that. The biologicals platform for us is, as you know, something we're focusing heavily on. I have to say that we put the alliance in place back in October. We have, right now, 5 new products that are in field testing in North America. A suite of products is expected to go into Latin America for field testing, as we hit their season in the second half of this year. The collaboration is working very, very well. As you know, we also put into that a company we bought, which is a research-based company for screening and identifying of microbial agents for use in biologicals. They're doing a tremendous job. And we have a very strong pipeline of opportunities both in fungicides and in plant growth regulators. So we're very hopeful that, that project will come to fruition. We expect the first products to be out in the marketplace in 2015, predominantly in North America. But I have to say, as an alliance, given the short space of time we've been working with them, we are very impressed with Chr. Hansen, in terms of their ability to scale up the products we're feeding into that alliance, so it's going well.

Next question comes from the line of Mike Harrison from First Analysis.

If I'm looking at the ag business, you commented that you're going to keep an eye on customer inventory levels. Is there any concern that some of the aggressive selling tactics, that came about in Q2, led to some inventory build and maybe you pulled some of your top line from Q3 back into Q2?

Mike, it's Mark. No. What Pierre was referring to in terms of the aggressiveness of the sales group was predominantly down in Latin America. And as you know, Q2 is a pretty quiet period in Latin America, rolling off one season and starting to get ready to gear up for the second season in Q3 and Q4. There may well be pockets of increased inventory throughout that enormous market down there. But fundamentally, it's not going to slow down the growth for FMC, with our active ingredients and our proprietary products. I would say, North America, given the conditions that we saw with weather, it would not surprise me that in some segments, that as the numbers come in, that we see elevated levels of channel inventory. I'm particularly thinking of the corn market. That was particularly affected in terms of insecticides. We may well see elevated levels there. However to offset that, we did extremely well with pre-emergent products, and I would expect, when the numbers come in, that those inventory levels are extremely low.

So I mean, just to support what Mark said, the aggressiveness in terms of selling, those were not on product we are focusing on in Q3 and Q4. Those are products we sold. I believe, we gained market share. But it's market share gained on low margin product based on relationship with customers and certainly not places which are critical to our sales projections for Q3 and Q4.

And then, Mark, maybe you can give a little bit more detail to help us understand the issues around the Brazil sugarcane market and maybe what the drought means to the long-term trajectory of growth in acreage there?

Yes, sure. We talked about it a lot in the various calls over the last few quarters. The droughts had a significant impact on productivity, from the sugar mills themselves in terms of how much sugar is produced out of the actual acreage. But combined with that is the economic impact of what's been going on with ethanol and with sugar pricing in the world markets. That's also been a significant impact. We expect longer term. And certainly, as we go through the rest of this decade, as we think about the next phase of our growth, that sugarcane will continue to be a major growth area for us. This business has gone through these cycles in the past where you've seen significant consolidation on the back of weaker economics for the smaller players. That is also playing out as well. But for us, with our suite of herbicides and insecticides, new products coming to the marketplace, we continue to see it strong. Ethanol mandate will change in Brazil at some point. Prices will change. Sugar prices have been coming back over the last few months and continue to look more healthy. So we do expect the fundamentals to continue to look good. But in the short term, it's been a rough ride.

Okay. Well, I think, with that, that's about all the time we have for the call today. I want to thank everyone for joining us. I am available for additional questions that you might have, and I hope you have a great day.

Thank you. This concludes the FMC Corporation's Second Quarter 2014 Earnings Release Conference Call.