CF Industries CF posted profit of $26 million or 11 cents per share in the first quarter of 2016, a roughly 88.7% plunge from $231 million or 96 cents per share recorded a year ago.Barring one-time items, earnings were 40 cents per share for the quarter, down from 91 cents per share recorded a year ago. The figure also missed the Zacks Consensus Estimate of 51 cents.Sales rose roughly 5.2% year over year to $1,004 million in the quarter, breezing past the Zacks Consensus Estimate of $815 million. The top line was supported by increased sales volume, including benefits from expanded capacity and the inclusion of CF Fertilizers UK, partly offset by lower pricing across all segments. Elevated supply in the global nitrogen market and weaker demand for ammonia globally pressured pricing in the quarter. CF Industries Holdings Inc. (CF) Street EPS & Surprise Percent - Last 5 Quarters | FindTheCompany Segment ReviewSales for the Ammonia segment slipped roughly 7.3% year over year to $267 million in the reported quarter. Ammonia sales volumes rose 38.8% to 0.74 million tons year over year, partly due to early spring application in the quarter, along with the inclusion of CF Fertilizers UK. Average selling prices declined 33.2% to $362 per ton due to higher ammonia inventory and lower global demand.Sales for the Granular Urea segment rose 10.9% year over year to $235 million. Sales volumes in this segment increased 49.2% to 0.92 million tons as the new urea plant in Donaldsonville, LA, started production during the quarter, resulting in higher available tons, as well as early spring this year. Average selling prices per ton for granular urea declined 25.6% to $256 per ton owing to ample global supply.Sales in the UAN (urea ammonium nitrate solution) segment went down 13.2% year over year to $309 million. UAN sales volumes increased 10.2% to 1.45 million tons due to the company’s UAN plant in Donaldsonville, LA starting production in the quarter. Abundant global supply contributed to 21.1% lower pricing in the quarter.Sales in the AN (ammonium nitrate) segment more than doubled year over year to $125 million. Sales volumes surged 149% due to the addition of CF Fertilizers UK sales. Average selling prices remained relatively flat with the prior-year quarter.The Other segment’s sales climbed 44.7% year over year to $68 million. Sales volumes were 71.9% higher in the reported quarter as a result of the acquisition of CF Fertilizers UK. Average selling prices declined 15.7% to $177 per ton due to higher global nitrogen supply.FinancialsCF Industries ended the first quarter of 2016 with cash and cash equivalents of $2,689 million, up roughly 51.2% year over year. Long-term debt was $5,539 million, up 20.6% year over year.Operating cash for the quarter was $346 million, down 34.8% year over year. The board of directors declared a quarterly dividend of 30 cents per share for the quarter, payable on May 31, 2016.OutlookMoving ahead, CF Industries maintains a positive outlook for the remainder of 2016 and 2017, particularly due to its expansion plans. However, the company expects nitrogen prices to be under pressure, due to increasing supply, while the demand for urea is anticipated to remain firm for the application season.For 2016, the company has increased the total expected cash capital expenditures to $1.8–$2 billion from the previously stated $1.8 billion. The raised outlook is due to higher expected expenditure for the capacity expansion projects, of $1.3–$1.4 billion, compared to the prior projection of $1.2 billion, and between $500–$600 million for sustaining and other capital expenditures.The company’s expansion projects are nearing completion. The ammonia plant at Donaldsonville, LA is mechanically complete and in the process of being commissioned for start-up. The company also expects the ammonia and urea plants in Port Neal to be mechanically complete in second-quarter 2016.In Aug 2015, CF Industries agreed to purchase the European, North American and Global distribution assets of Netherlands-based fertilizers and industrial chemicals producer – OCI N.V. – in a deal valued at around $8 billion, including assumption of roughly $2 billion in debt. The deal, which remains subject to approval by the shareholders of CF Industries and OCI and other closing conditions, is expected to close in mid-2016.Zacks RankCF Industries currently carries a Zacks Rank #3 (Hold).Better-ranked companies in the basic materials sector include The Scotts Miracle-Gro Company SMG, Koninklijke DSM N.V. RDSMY and Sinopec Shanghai Petrochemical Co. Ltd. SHI, all sporting a Zacks Rank #1 (Strong Buy).Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report SHANGHAI PETROC (SHI): Free Stock Analysis Report KONINKLIJKE DSM (RDSMY): Free Stock Analysis Report CF INDUS HLDGS (CF): Free Stock Analysis Report SCOTTS MIRCL-GR (SMG): Free Stock Analysis Report To read this article on Zacks.com click here. 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