UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

þ		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2007

OR

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission file number: 1-8520

TERRA INDUSTRIES INC.

(Exact name of registrant as specified in its charter)

Maryland		52-1145429
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)
Terra Centre
P.O. Box 6000
600 Fourth Street
Sioux City, Iowa		51102-6000
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (712) 277-1340

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 þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act

Large accelerated filer o           Accelerated filer þ           Non-accelerated filer  o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
o Yes  þ No

As of October 23, 2007, the following shares of the registrant’s stock were outstanding:

Common Shares, without par value		89,507,153 shares

 

 

TABLE OF CONTENTS

Part I – FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets			3
Consolidated Statements of Operations			4
Consolidated Statements of Cash Flows			5
Consolidated Statements of Changes in Common Shareholders’ Equity			7
Notes to Consolidated Financial Statements			8
Item 2. Management Discussion and Analysis of Financial Condition and Results of Operations			31
Item 3. Quantitative and Qualitative Disclosures about Market Risk			38
Item 4. Controls and Procedures			38
Part II – OTHER INFORMATION
Item 1. Legal Proceedings			39
Item 1A. Risk Factors			39
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			39
Item 3. Defaults upon Senior Securities			39
Item 4. Submission of Matters to a Vote of Security Holders			40
Item 5. Other Information			40
Item 6. Exhibits			41
Exhibit 10.1
Exhibit 10.2
Exhibit 31.1
Exhibit 31.2
Exhibit 32

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

TERRA INDUSTRIES INC.

CONSOLIDATED BALANCE SHEETS

(in thousands)
(unaudited)

		September 30,				December 31,				September 30,
		2007				2006				2006
Assets
Cash and cash equivalents		$	360,478			$	179,017			$	122,170
Accounts receivable, less allowance for doubtful accounts of $326, $333 and $371			159,905				198,791				193,339
Inventories			126,154				211,017				160,191
Other current assets			13,067				31,680				26,158
Total current assets			659,604				620,505				501,858
Property, plant and equipment, net			435,103				720,897				722,952
Equity method investments			369,605				164,099				161,455
Deferred plant turnaround costs, net			35,029				44,558				40,577
Intangible assets, net			4,234				5,645				6,115
Other assets			16,918				17,009				27,164
Total assets		$	1,520,493			$	1,572,713			$	1,460,121
Liabilities
Accounts payable			80,296				156,493				115,734
Customer prepayments			85,313				77,091				27,949
Accrued expenses and other current liabilities			96,351				75,863				80,974
Total current liabilities			261,960				309,447				224,657
Long-term debt and capital lease obligations			330,000				331,300				331,300
Pension liabilities			38,041				134,444				112,729
Other liabilities			139,882				104,039				96,541
Minority interest			102,854				94,687				95,014
Total liabilities and minority interest			872,737				973,917				860,241
Preferred Stock - liquidation value of $120,000			115,800				115,800				115,800
Common Shareholders’ Equity
Capital stock
Common Shares, authorized 133,500 shares; 89,501; 92,630 and 92,639 outstanding			142,069				144,976				144,968
Paid-in capital			617,085				693,896				693,944
Accumulated other comprehensive loss			(63,480	)			(63,739	)			(52,362	)
Accumulated deficit			(163,718	)			(292,137	)			(302,470	)
Total common shareholders’ equity			531,956				482,996				484,080
Total liabilities and minority interest, preferred stock and common shareholders’ equity		$	1,520,493			$	1,572,713			$	1,460,121

See Accompanying Notes to the Consolidated Financial Statements.

TERRA INDUSTRIES INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per-share amounts)
(unaudited)

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2007				2006				2007				2006
Revenues
Product revenues		$	590,046			$	461,533			$	1,780,840			$	1,381,084
Other income			3,669				3,248				8,976				6,135
Total revenues			593,715				464,781				1,789,816				1,387,219
Costs and Expenses
Cost of sales			442,879				422,523				1,405,098				1,337,210
Selling, general and administrative expense			21,935				13,679				67,186				38,395
Equity (earnings) of unconsolidated affiliates (Note 8)			(5,566	)			(809	)			(10,379	)			(15,830	)
Impairment of long-lived assets (Note 5)			38,964				—				38,964				—
Total cost and expenses			498,212				435,393				1,500,869				1,359,775
Income (loss) from operations			95,503				29,388				288,947				27,444
Equity earnings of unconsolidated affiliates (Note 8)			2,202				—				2,202				—
Interest income			4,709				2,091				11,078				5,499
Interest expense			(6,905	)			(11,786	)			(22,685	)			(35,340	)
Loss on early retirement of debt			—				—				(38,836	)			—
Income (loss) before income taxes and minority interest			95,509				19,693				240,706				(2,397	)
Income tax (provision) benefit			(29,985	)			(6,000	)			(74,742	)			2,002
Minority interest			(11,144	)			(3,352	)			(33,720	)			(7,000	)
Net income (loss)			54,380				10,341				132,244				(7,395	)
Preferred share dividends			(1,275	)			(1,275	)			(3,825	)			(3,825	)
Income (Loss) Available to Common Shareholders		$	53,105			$	9,066			$	128,419			$	(11,220	)
Basic and diluted income (loss) per share:
Basic		$	0.59			$	0.10			$	1.41			$	(0.12	)
Diluted		$	0.51			$	0.10			$	1.24			$	(0.12	)
Basic and diluted weighted average shares outstanding:
Basic			90,092				91,817				91,143				92,994
Diluted			105,946				93,405				106,899				92,994

See Accompanying Notes to the Consolidated Financial Statements.

TERRA INDUSTRIES INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)
(unaudited)

		Nine Months Ended
		September 30,
		2007				2006
Operating Activities
Net income (loss)		$	132,244			$	(7,395	)
Adjustments to reconcile net income (loss) to net cash flows from operating activities:
Depreciation of property, plant and equipment and amortization of deferred plant turnaround costs			81,057				78,859
Impairment of long-lived assets			38,964				—
Deferred income taxes			48,981				(2,002	)
Minority interest in earnings			33,720				7,000
Distributions in excess of equity earnings			5,121				9,135
Equity earnings GrowHow UK Limited			(2,202	)			—
Non-cash loss on derivatives			176				2,775
Share-based compensation			16,838				4,285
Amortization of intangible and other assets			6,655				8,128
Non-cash loss on early retirement of debt			4,662				—
Changes in operating assets and liabilities:
Accounts receivable			(29,242	)			25,785
Inventories			49,472				36,592
Accounts payable and customer prepayments			(25,100	)			(38,859	)
Other assets and liabilities, net			20,391				(21,029	)
Net cash flows from operating activities			381,737				103,274
Investing Activities
Purchase of property, plant and equipment			(23,124	)			(40,785	)
Plant turnaround expenditures			(35,985	)			(31,987	)
Cash retained by GrowHow UK Limited			(17,249	)			—
Distributions received from unconsolidated affiliates			—				9,660
Changes in restricted cash			—				8,595
Proceeds from the sale of property, plant and equipment			—				9,666
Net cash flows from investing activities			(76,358	)			(44,851	)
Financing Activities
Issuance of debt			330,000				—
Payments under borrowing arrangements			(331,300	)			(34	)
Payments for debt issuance costs			(6,403	)			—
Preferred share dividends paid			(3,825	)			(3,825	)
Common stock issuances and vestings			89				363
Payments under share repurchase program			(87,426	)			(18,796	)
Distributions to minority interests			(25,554	)			(4,244	)
Net cash flows from financing activities			(124,419	)			(26,536	)
Effect of exchange rate changes on cash			501				3,917
Increase to cash and cash equivalents			181,461				35,804
Cash and cash equivalents at beginning of period			179,017				86,366
Cash and cash equivalents at end of period		$	360,478			$	122,170

See Accompanying Notes to the Consolidated Financial Statements.

Consolidated Statements of Cash Flows (continued)

		Nine Months ended
		September 30
		2007				2006
Supplemental cash flow information:
Interest paid		$	22,900			$	21,394
Income tax refunds received		$	555			$	—
Income taxes paid		$	8,743			$	1,569
Supplemental schedule of non-cash investing and financing activities:
Conversion of warrants to common stock		$	568			$	—
Equity method investments contributed to GrowHow UK Limited		$	193,784			$	—
Supplemental schedule of unconsolidated affiliates distributions received:
Equity earnings of unconsolidated affiliates		$	10,379			$	15,830
Distribution in excess of (less than) equity earnings			5,121				9,135
Distributions received from unconsolidated affiliates			—				9,660
Total cash distributions received from unconsolidated affiliates		$	15,500			$	34,625

See Accompanying Notes to the Consolidated Financial Statements.

TERRA INDUSTRIES INC.

CONSOLIDATED STATEMENTS OF CHANGES IN COMMON SHAREHOLDERS’ EQUITY

NINE MONTHS ENDED SEPTEMBER 30, 2007 AND 2006
(in thousands)
(unaudited)

										Accumulated
										Other
		Common				Paid-In				Comprehensive				Accumulated								Comprehensive
		Stock				Capital				Loss				Deficit				Total				Income
Balance at January 1, 2007		$	144,976			$	693,896			$	(63,739	)		$	(292,137	)		$	482,996
Comprehensive income (loss):
Net income			—				—				—				132,244				132,244			$	132,244
Foreign currency translation adjustment			—				—				(42,361	)			—				(42,361	)			(42,361	)
Change in fair value of derivatives, net of taxes of $1,381			—				—				(2,565	)			—				(2,565	)			(2,565	)
Pension and post retirement benefit liabilities			—				—				1,913				—				1,913				1,913
Comprehensive income																						$	89,231
Transfer of UK pension plan to GrowHow UK Limited			—				—				43,272				—				43,272
Preferred share dividends			—				—				—				(3,825	)			(3,825	)
Exercise of stock options			252				320				—				—				572
Net vested stock			273				(757	)			—				—				(484	)
Conversion of warrants			568				(568	)			—				—				—
Shares purchased and retired under share repurchase program			(4,000	)			(83,426	)			—				—				(87,426	)
Share-based compensation			—				7,620				—				—				7,620
Balance September 30, 2007		$	142,069			$	617,085			$	(63,480	)		$	(163,718	)		$	531,956

										Accumulated
										Other
		Common				Paid-In				Comprehensive				Unearned				Accumulated								Comprehensive
		Stock				Capital				Loss				Compensation				Deficit				Total				Income
Balance at January 1, 2006		$	146,994			$	712,671			$	(70,143	)		$	(5,369	)		$	(291,250	)		$	492,903
Comprehensive income (loss):
Net loss			—				—				—				—				(7,395	)			(7,395	)		$	(7,395	)
Foreign currency translation adjustment			—				—				22,638				—				—				22,638				22,638
Change in fair value of derivatives, net of taxes of $2,589			—				—				(4,857	)			—				—				(4,857	)			(4,857	)
Comprehensive income																										$	10,386
Preferred share dividends			—				—				—				—				(3,825	)			(3,825	)
Exercise of stock options			95				268				—				—				—				363
Non vested stock			554				549				—				—				—				1,103
Shares purchased and retired under share repurchase program			(2,675	)			(16,121	)			—				—				—				(18,796	)
Reclassification for adoption of FAS 123 R			—				(5,369	)			—				5,369				—				—
Share-based compensation			—				1,946				—				—				—				1,946
Balance at September 30, 2006		$	144,968			$	693,944			$	(52,362	)		$	—			$	(302,470	)		$	484,080

See Accompanying Notes to the Consolidated Financial Statements.

TERRA INDUSTRIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1.

Financial Statement Presentation

Basis of Presentation

The accompanying unaudited consolidated financial statements and notes thereto contain all adjustments necessary, in the opinion of management, to summarize fairly the financial position of Terra Industries Inc. and all majority-owned subsidiaries (“Terra”, “the Company” and “it”) and the results of operations for the periods presented. Because of the seasonal nature of Terra’s operations and effects of weather-related conditions in several of its marketing areas, results of any interim reporting period should not be considered as indicative of results for a full year. These statements should be read in conjunction with the Company’s 2006 Annual Report on Form 10-K to Shareholders.

Revenue Recognition

Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred, the price is fixed or determinable, no obligations remain and collectibility is probable.

Revenues are primarily comprised of sales of the Company’s nitrogen- and methanol-based products, including any realized hedging gains or losses related to nitrogen product derivatives, and are reduced by estimated discounts and trade allowances. Revenues also include profit sharing revenue under the Methanex supply contract when the estimated margin on an annualized basis is probable. The Company classifies amounts directly or indirectly billed to its customers for shipping and handling as revenue.

Cost of Sales

Costs of sales are primarily manufacturing costs related to the Company’s nitrogen- and methanol-based products, including any realized hedging gains or losses related to natural gas derivatives. The Company classifies amounts directly or indirectly billed for delivery of products to its customers or its terminals as cost of sales.

Derivatives and Financial Instruments

The Company enters into derivative financial instruments, including swaps, basis swaps, purchased put and call options and sold call options, to manage the effect of changes in natural gas costs, to manage the prices of its nitrogen products and to manage foreign currency risk. The Company reports the fair value of the derivatives on its balance sheet. If the derivative is not designated as a hedging instrument, changes in fair value are recognized in earnings in the period of change. If the derivative is designated as a hedge, and to the extent such hedge is determined to be effective, changes in fair value are either (a) offset by the change in fair value of the hedged asset or liability, or (b) reported as a component of accumulated other comprehensive income (loss) in the period of change, and subsequently recognized in cost of sales in the period the offsetting hedged transaction occurs. If an instrument is settled early, any gains or losses are immediately recognized in cost of sales.

Inventories

Inventories are stated at the lower of average cost or estimated net realizable value. The Company performs a monthly analysis of its inventory balances to determine if the carrying amount of inventories exceeds its net realizable value. The analysis of estimated realizable value is based on customer orders, market trends, and historical pricing. If the carrying amount exceeds the estimated net realizable value, the carrying amount is reduced to the estimated net realizable value.

Production costs include the cost of direct labor and materials, depreciation and amortization, and overhead costs related to manufacturing activity. The cost of inventories is determined using the first- in, first-out method.

The Company estimates a reserve for obsolescence and excess of its materials and supplies inventory. Inventory is stated net of the reserve.

Plant Turnaround Costs

Costs related to the periodic scheduled major maintenance of continuous process production facilities (plant turnarounds) are deferred and charged to product costs on a straight-line basis during the period until the next scheduled turnaround, generally two years.

Impairment of Long-Lived Assets

Terra reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If the sum of the expected future cash flows expected to result from the use of the asset (undiscounted and without interest charges) is less than the carrying amount of the asset, an impairment loss is recognized based on the difference between the carrying amount and the fair value of the asset. During the third quarter, there was an impairment at the Beaumont, Texas facility, see Note 5.

Use of Estimates in Preparation of the Financial Statements

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

2.

Income (Loss) Per Share

Basic income (loss) per share data is based on the weighted-average number of common shares outstanding during the period. Diluted income (loss) per share data is based on the weighted-average number of common shares outstanding and the effect of all dilutive potential common shares including stock options, nonvested shares, convertible preferred shares and common stock warrants. Nonvested stock carries dividend and voting rights, but is not involved in the weighted average number of common shares outstanding used to compute basic income (loss) per share.

The following table provides a reconciliation between basic and diluted income (loss) per share for the three- and nine-month periods ended September 30, 2007 and 2006:

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
(in thousands, except per-share amounts)		2007				2006				2007				2006
Basic income (loss) per share computation:
Net Income (loss)		$	54,380			$	10,341			$	132,244			$	(7,395	)
Less: Preferred share dividends			(1,275	)			(1,275	)			(3,825	)			(3,825	)
Income (loss) available to common shareholders		$	53,105			$	9,066			$	128,419			$	(11,220	)
Weighted average shares outstanding			90,092				91,817				91,143				92,994
Basic income (loss) per common share		$	0.59			$	0.10			$	1.41			$	(0.12	)
Diluted income (loss) per share computation:
Income (loss) available to common shareholders		$	53,105			$	9,066			$	128,419			$	(11,220	)
Add: Preferred share dividends			1,275				—				3,825				—
Income (loss) available to common shareholders and assumed conversions		$	54,380			$	9,066			$	132,244			$	(11,220	)
Weighted average shares outstanding			90,092				91,817				91,143				92,994
Add incremental shares from assumed conversions:
Preferred shares			12,049				—				12,049				—
Nonvested stock			985				596				783				—
Common stock warrants			2,710				846				2,791				—
Common stock options			110				146				133				—
Dilutive potential common shares			105,946				93,405				106,899				92,994
Diluted income (loss) per common share		$	0.51			$	0.10			$	1.24			$	(0.12	)

For the three-month period ended September 30, 2006, common stock options totaling 0.1 million shares were excluded from the computation of diluted income per share because the exercise prices of these options exceeded the average market price of the Company’s stock for the respective periods, and the effect of their inclusion would have been antidilutive. For the three-month period ending September 30, 2006, 120,000 preferred shares were excluded from the computation of diluted earnings per share. These preferred shares were antidilutive using the if-converted method.

For the nine-month period ended September 30, 2006, all preferred shares, nonvested stock and common stock options were antidilutive because the Company was in a net loss position. As such, these instruments were excluded from the computation of the diluted income (loss) per share for the nine-month period ended September 30, 2006.

3.

Inventories

Inventories consisted of the following:

		September 30,				December 31,				September 30,
(in thousands)		2007				2006				2006
Raw materials		$	19,558			$	26,583			$	29,679
Supplies			36,385				54,542				53,642
Finished goods			70,211				129,892				76,870
Total		$	126,154			$	211,017			$	160,191

Inventory is valued at actual first-in, first-out cost. Costs include raw material, labor and overhead.

4.

Derivative Financial Instruments

Terra manages risk using derivative financial instruments for (a) changes in natural gas supply prices (b) interest rate fluctuations (c) changes in nitrogen prices and (d) currency. Derivative financial instruments have credit risk and market risk.

To manage credit risk, Terra enters into derivative transactions only with counter-parties who are currently rated as BBB or better or equivalent as recognized by a national rating agency. Terra will not enter into transactions with a counter-party if the additional transaction will result in credit exposure exceeding $20 million. The credit rating of counter-parties may be modified through guarantees, letters of credit or other credit enhancement vehicles.

Terra classifies a derivative financial instrument as a hedge if all of the following conditions are met:

	1.		The item to be hedged must expose Terra to currency, interest or price risk.
	2.		It must be probable that the results of the hedge position substantially offset the effects of currency, interest or price changes on the hedged item (e.g., there is a high correlation between the hedge position and changes in market value of the hedge item).
	3.		The derivative financial instrument must be designated as a hedge of the item at the inception of the hedge.

Natural gas supplies to meet production requirements at Terra’s North American and United Kingdom (U.K.) production facilities are purchased at market prices (See Note 8). Natural gas market prices are volatile and Terra effectively fixes prices for a portion of its natural gas production requirements and inventory through the use of futures contracts, swaps and options. The North American contracts reference physical natural gas prices or appropriate NYMEX futures contract prices. Contract physical prices for North America are frequently based on prices at the Henry Hub in Louisiana, the most common and financially liquid location of reference for financial derivatives related to natural gas. However, natural gas supplies for Terra’s North American production facilities are purchased at locations other than Henry Hub, which often creates a location basis differential between the contract price and the physical price of natural gas. Accordingly, the use of financial derivatives may not exactly offset the change in the price of physical gas. The U.K. contracts are based on the Intercontinental Exchange (ICE) index price. Physical delivery prices in the U.K. are based on the ICE index. The contracts are traded in months forward and settlement dates are scheduled to coincide with gas purchases during that future period.

A swap is a contract between Terra and a third party to exchange cash based on a designated price. Option contracts give the holder the right to either own or sell a futures or swap contract. The futures contracts require maintenance of cash balances generally 10% to 20% of the contract value and option contracts require initial premium payments ranging from 2% to 5% of contract value. Basis swap contracts require payments to or from Terra for the amount, if any, that monthly published gas prices from the source specified in the contract differ from the prices of a NYMEX natural gas futures during a specified period. There are no initial cash requirements related to the swap and basis swap agreements.

Terra may also use a collar structure where it will enter into a swap, sell a call at a higher price and buy a put. The collar structure allows for greater participation in a decrease to natural gas prices and protects against moderate price increases. However, the collar exposes Terra to large price increases. At September 30, 2007 there were no collars outstanding.

The following summarizes open natural gas derivative contracts at September 30, 2007 and 2006 and December 31, 2006:

		Other				Other
		Current				Current				Deferred				Net
(in thousands)		Assets				Liabilities				Taxes				Asset (Liability)
September 30, 2007		$	4,732			$	(26,167	)		$	7,754			$	(13,681	)
December 31, 2006		$	4,731			$	(22,591	)		$	6,373			$	(11,487	)
September 30, 2006		$	7,050			$	(22,129	)		$	5,365			$	(9,714	)

Certain derivatives outstanding at September 30, 2007 and 2006, which settled during October 2007 and 2006, respectively, are included in the position of open natural gas derivatives in the table above. The October 2007 derivatives settled for an approximate $7.7 million loss. Substantially all open derivatives will settle during the next 12 months.

At September 30, 2007, the Company determined that certain derivative contracts were ineffective hedges for accounting purposes and recorded a credit of $0.3 million to cost of sales for the three-month period and a credit of $1.7 million for the nine-month period ending September 30, 2007. At September 30, 2006, the Company determined that certain derivative contracts were ineffective hedges for accounting purposes and recorded a charge of $1.2 million and $2.8 million to cost of sales for the three- and nine-month periods ending September 30, 2006, respectively.

The effective portion of gains and losses on derivative contracts that qualify for hedge treatment are carried as accumulated other comprehensive income (loss) and credited or charged to cost of sales in the month in which the hedged transaction settles. Gains and losses on the contracts that do not qualify for hedge treatment are credited or charged to cost of sales based on the positions’ fair value. The risk and reward of outstanding natural gas positions are directly related to increases or decreases in natural gas prices in relation to the underlying NYMEX and ICE natural gas contract prices.

The activity to accumulated other comprehensive income (loss), net of income taxes, relating to current period hedging transactions for the three-month periods ended September 30, 2007 and 2006 follows:

		Three Months Ended
		September 30,
		2007								2006
(in thousands)		Gross				Net of tax				Gross				Net of tax
Beginning accumulated gain (loss)		$	(28,684	)		$	(18,644	)		$	(7,034	)		$	(4,578	)
Reclassification into earnings			(31,210	)			(20,286	)			(34	)			(14	)
Net change in market value			37,739				24,529				(8,263	)			(5,374	)
Ending accumulated gain (loss)		$	(22,155	)		$	(14,401	)		$	(15,331	)		$	(9,966	)

The activity to accumulated other comprehensive income (loss), net of income taxes, relating to current period hedging transactions for the nine-month periods ended September 30, 2007 and 2006 follows:

		Nine Months Ended
		September 30,
		2007								2006
(in thousands)		Gross				Net of tax				Gross				Net of tax
Beginning accumulated gain (loss)		$	(18,210	)		$	(11,836	)		$	(7,886	)		$	(5,109	)
Reclassification into earnings			(31,562	)			(20,515	)			42,556				27,597
Net change in market value			27,617				17,950				(50,001	)			(32,454	)
Ending accumulated gain (loss)		$	(22,155	)		$	(14,401	)		$	(15,331	)		$	(9,966	)

At times, the Company also uses forward derivative instruments to fix or set floor prices for a portion of its nitrogen sales volumes. At September 30, 2007, the Company had open contracts of nitrogen solutions. When outstanding, the nitrogen solution contracts do not qualify for hedge treatment due to inadequate trading history to demonstrate effectiveness. Consequently, these contracts are marked-to-market and unrealized gains or losses are reflected in revenue in the statement of operations. For the three- and nine-month periods ending September 30, 2007, the Company recognized a loss of $1.0 million and $2.9 million, respectively, on nitrogen forward derivative instruments. For the three- and nine-month periods ending September 30, 2006, there were no gains or losses on nitrogen forward derivative instruments.

5.

Impairment of Beaumont Assets

On September 28, 2007, Eastman Chemical Company exercised its option to purchase the Company’s Beaumont, Texas assets, including the methanol and ammonia production facilities. The Company anticipates closing the sale on or before January 1, 2009.

As a result of this agreement, the Company determined that the value of its Beaumont property was impaired. The Company recorded a $39.0 million impairment charge for the quarter ended September 30, 2007. The impairment charge reduces Terra’s investment in the Beaumont property to approximately $51 million.

6.

Unrecognized Tax Benefit

The Company adopted the provision of Financial Accounting Standards Board (FASB) Interpretation No. 48, Accounting for Uncertainty to Income Taxes (FIN 48), on January 1, 2007. Under FIN 48, tax benefits are recorded only for tax positions that are more likely than not to be sustained upon examination by tax authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50% likely to be realized upon ultimate settlement. Unrecognized tax benefits are tax benefits claimed in the Company’s tax returns that do not meet these recognition and measurement standards.

The primary jurisdictions in which the Company or one of its subsidiaries files income tax returns are the United States, Canada and the United Kingdom (See Note 8). In most United States jurisdictions, the Company has significant net operating loss (“NOL”) carryforwards that date back to 1999 and will remain subject to examination by tax authorities as those NOL positions may be used to offset future taxable earnings. For jurisdictions in Canada and the United Kingdom, income tax returns remain subject to examination by tax authorities for calendar years beginning in 2001 and 2005, respectively.

The adoption of FIN 48 had no impact on the Company’s financial statements other than the reclassification of the unrecognized tax benefit. The Company’s other liabilities include an unrecognized tax benefit of $33.5 million at September 30, 2007, which had been previously recognized under FASB Statement No. 5 Accounting for Contingencies or FASB Statement No. 109 Accounting for Income Taxes. There were no changes in unrecognized tax positions during the period, and there are no expected changes in the next twelve months. If recognized, the $33.5 million of unrecognized tax benefit would have an impact on the effective tax rate.

When applicable, the Company recognizes interest accrued and penalties related to unrecognized tax benefits in income taxes on the statement of operations. Due to the Company’s NOL carryforward position, no interest or penalties were recognized at September 30, 2007.

7.

Other Liabilities

Other liabilities consisted of the following:

		September 30,				December 31,				September 30,
(in thousands)		2007				2006				2006
Deferred income taxes		$	49,691			$	63,851			$	58,922
Unrecognized tax benefit			33,560				—				—
Long-term medical and closed facility reserve			24,026				23,206				23,560
Other			32,605				16,982				14,060
		$	139,882			$	104,039			$	96,542

8.

Equity Investments

Trinidad and United States

Terra’s investments in companies that are accounted for on the equity method of accounting and included in operations consist of the following: (1) 50% ownership interest in Point Lisas Nitrogen Limited, (“PLNL”) which operates an ammonia production plant in Trinidad (2) 50% interest in an ammonia storage joint venture located in Houston, Texas and (3) 50% interest in a joint venture in Oklahoma CO₂ at Terra’s Verdigris nitrogen plant. These investments were $156.4 million at September 30, 2007. Terra includes the net earnings of these investments as an element of income from operations as the investees’ operations provide additional capacity to Terra’s operations.

The combined results of operations and financial position of Terra’s equity method investments are summarized below:

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
(in thousands)		2007				2006				2007				2006
Condensed income statement information:
Net sales		$	46,844			$	28,078			$	101,903			$	129,943
Net income		$	13,555			$	4,483			$	23,049			$	32,964
Terra’s (loss) equity in earnings of unconsolidated affiliates		$	5,566			$	809			$	10,379			$	15,830

		September 30,				September 30,
(in thousands)		2007				2006
Condensed balance sheet information:
Current assets		$	43,130			$	45,964
Long-lived assets			194,310				194,549
Total assets		$	237,440			$	240,513
Current liabilities		$	24,193			$	26,473
Long-term liabilities			—				—
Equity			213,247				214,040
Total liabilities and equity		$	237,440			$	240,513

The carrying value of these investments at September 30, 2007 was $49.7 million more than Terra’s share of the affiliates’ book value. The excess is attributable primarily to the step-up in basis for fixed asset values, which is being depreciated over a period of approximately 15 years. Terra’s equity in earnings of unconsolidated subsidiaries is different than its ownership interest in income reported by the unconsolidated subsidiaries due to deferred profits on intergroup transactions and amortization of basis differences.

Terra has transactions in the normal course of business with PLNL whereby Terra is obliged to purchase 50 percent of the ammonia produced by PLNL at current market prices. During the nine-month period ending September 30, 2007, Terra purchased approximately $52.7 million of ammonia from PLNL. During 2007, PLNL performed a turnaround, resulting in lower production levels and consequently, lower purchases by the Company. During the first nine months of 2006, Terra purchased approximately $63.4 million of ammonia from PLNL.

During the first nine months of 2007 there were $15.5 million in cash distributions from all of the Company’s equity investments. The total distributions from all investments were $34.6 million for the nine-month period ended September 30, 2006.

United Kingdom

On September 14, 2007, the Company completed the formation of GrowHow UK Limited (GrowHow), a joint venture between the Company and Kemira GrowHow Oyj (Kemira). Pursuant to the joint venture agreement, Terra contributed its United Kingdom subsidiary Terra Nitrogen (UK) Limited to the joint venture for a 50% interest. Subsequent to September 14, 2007, the Company has accounted for its investment in GrowHow UK Limited as an equity method investment. The equity investment of $213.2 million was recorded at Terra’s net historical cost basis.

The preliminary financial position of GrowHow UK Limited at September 30, 2007 was:

		September 30,
Condensed balance sheet information:		2007
Current assets		$	119,082
Long-lived assets			179,767
Total Assets		$	298,849
Current liabilities		$	52,527
Long-term liabilities			74,697
Equity			171,625
Total liabilities and Equity		$	298,849

These preliminary financial position balances are based on historical cost of the Growhow UK Limited assets contributed into the joint venture.

Pursuant to the joint venture agreement, the Company retained all rights to sales generated through September 30, 2007. GrowHow UK Limited was formed on September 14, 2007. The Company estimated the equity earnings of its equity method investment of $2.2 million for the 2007 third quarter. This estimate was based on the proportionate number of days as an equity investment as compared to the pre-joint venture classification as a wholly-owned and fully consolidated subsidiary.

The Company’s interest in the joint venture is classified as a non operating equity investment. Terra does not include the net earnings of this investment as an element of income from operations since the investees’ operations do not provide additional capacity to Terra, nor are its operations integrated with Terra’s supply chain in North America.

Pursuant to the Joint Venture Contribution Agreement, the Company is eligible to receive a balancing consideration payment from GrowHow UK Limited. The payment is due to the Company in 2011. The Company will receive a minimum of $40 million, and has the right to receive up to $120 million, based on operational efficiencies of GrowHow UK Limited.

The Company has rights to receive a cash refund from GrowHow UK Limited for working capital contributions in excess of amounts specified in the Joint Venture Contribution Agreement. The Company anticipates receiving approximately $20 million during the 2007 fourth quarter.

There were no distributions from the United Kingdom equity investment for the three- and nine-month period ended September 30, 2007.

9.

Long-term Debt and Capital Lease Obligation

Long-term debt and capital lease obligations consisted of the following:

		September 30,				December 31,				September 30,
(in thousands)		2007				2006				2006
Unsecured Senior Notes, 7.0% due 2017		$	330,000			$	—			$	—
Secured Senior Notes, 12.875% due 2008			—				200,000				200,000
Second Priority Senior Secured Notes, 11.5%, due 2010			—				131,300				131,300
Other			—				1				4
Total long-term debt and capital lease obligations			330,000				331,301				331,304
Less current maturities			—				1				4
Total long-term debt and capital lease obligations		$	330,000			$	331,300			$	331,300

In January 2007, Terra Capital, Inc., (“TCAPI”) a subsidiary of Terra Industries Inc., issued $330 million of 7.0% Senior Notes due 2017. The notes are unconditionally guaranteed by Terra Industries Inc. and its U.S. subsidiaries. Fees and expenses of the transaction totaled $6.4 million. These notes and guarantees are unsecured and will rank equal in right of payment with any existing and future senior obligations of such guarantors.

The Indenture governing these notes contains covenants that limit, among other things, the Company’s ability to: incur additional debt, pay dividends on common stock of Terra Industries Inc. or repurchase shares of such common stock, make certain investments, sell any of the Company’s principal production facilities or sell other assets outside the ordinary course of business, enter into transactions with affiliates, limit dividends or other payments by the Company’s restricted subsidiaries, enter into sale and leaseback transactions, engage in other businesses, sell all or substantially all of the Company’s assets or merge with or into other companies, and reduce the Company’s insurance coverage.

The Company is obligated to offer to repurchase these notes upon a Change of Control (as defined in the Indenture) at a cash price equal to 101% of the aggregate principal amount outstanding at that time, plus accrued interest to the date of purchase. The Indenture governing these notes contains events of default and remedies customary for a financing of this type.

Offering proceeds were used to repurchase the Company’s 12.875% Senior Secured Notes and 11.5% Second Priority Secured Notes pursuant to a tender offer.

As a result of the Company’s debt refinancing, the Company incurred costs of approximately $31.9 million for tender premiums, and approximately $2.2 million for make-whole payments and administrative expenses. In addition, the Company recognized approximately $4.7 million of expense related to deferred fees on the bonds that were repaid. In connection with the new bond offering the Company paid approximately $6.4 million for fees and administrative costs.

In the first quarter of 2007, the Company amended the $200 million revolving credit facility to extend the expiration date to January 31, 2012. The revolving credit facility is secured by substantially all of the assets of the Company. Borrowing availability is generally based on 100% of eligible cash balances, 85% of eligible accounts receivable and 60% of eligible finished goods inventory less outstanding letters of credit issued under the facility. These facilities include $50 million only available for the use of Terra Nitrogen Company, L.P. (TNCLP), one of the Company’s consolidated subsidiaries. Borrowings under the revolving credit facility will bear interest at a floating rate plus an applicable margin, which can be either a base rate, or, at the Company’s option, a London Interbank Offered Rate (LIBOR). At September 30, 2007, the LIBOR rate was 5.13%. The base rate is the highest of (1) Citibank, N.A.’s base rate (2) the federal funds effective rate, plus one-half percent (0.50%) per annum and (3) the base three month certificate of deposit rate, plus one-half percent (0.50%) per annum, plus an applicable margin in each case. LIBOR loans will bear interest at LIBOR plus an applicable margin. The applicable margins for base rate loans and LIBOR loans are 0.50% and 1.75%, respectively, at September 30, 2007. The revolving credit facility requires an initial one-half percent (0.50%) commitment fee on the difference between committed amounts and amounts actually borrowed.

At September 30, 2007, the Company had no outstanding revolving credit borrowings and $10.8 million in outstanding letters of credit. The $10.8 million in outstanding letters of credit reduced the Company’s borrowing availability to $189.2 million at September 30, 2007. The credit facilities require that the Company adhere to certain limitations on additional debt, capital expenditures, acquisitions, liens, asset sales, investments, prepayments of subordinated indebtedness, changes in lines of business and transactions with affiliates. If the Company’s borrowing availability falls below $60 million, the Company is required to have achieved minimum operating cash flows or earnings before interest, income taxes, depreciation, amortization and other non-cash items of $60 million during the most recent four quarters.

10.

Pension Plans

Terra maintains defined benefit and defined contribution pension plans that cover substantially all salaried and hourly employees. Benefits are based on a pay formula. The defined benefit plans’ assets consist principally of equity securities and corporate and government debt securities. The Company also has certain non-qualified pension plans covering executives, which are unfunded. Terra accrues pension costs based upon annual actuarial valuations for each plan and funds these costs in accordance with statutory requirements.

The estimated components of net periodic pension expense follow:

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
(in thousands)		2007				2006				2007				2006
Service cost		$	748			$	744			$	2,244			$	2,232
Interest cost			6,231				5,888				18,693				17,664
Expected return on plan assets			(6,056	)			(5,394	)			(18,168	)			(16,182	)
Amortization of prior service cost			(9	)			(7	)			(27	)			(21	)
Amortization of actuarial loss			1,409				1,408				4,227				4,224
Termination charge			123				291				369				873
Pension expense		$	2,446			$	2,930			$	7,338			$	8,790

Cash contributions to the defined benefit pension plans for the three months ended September 30, 2007 and 2006 were $14.7 million and $8.8 million, respectively. Cash contributions to the defined benefit pension plans for the nine months ended September 30, 2007 and 2006 were $29.4 million and $14.1 million, respectively.

During the 2007 third quarter, the Company contributed its UK assets and operations into a joint venture, which included a reduction of the Company’s pension liabilities of approximately $67 million (see Note 8).

Terra also sponsors defined contribution savings plans covering most full-time employees. Contributions made by participating employees are matched based on a specified percentage of employee contributions. The cost of the Company contributions to these plans for the three-month periods ending September 30, 2007 and 2006 totaled $1.4 million and $1.2 million, respectively. Contributions to these plans for the nine-month periods ending September 30, 2007 and 2006 were $4.5 million and $5.3 million, respectively.

Terra provides health care benefits for certain U.S. employees who retired on or before January 1, 2002. Participant contributions and co-payments are subject to escalation. The plan pays a stated percentage of most medical expenses reduced for any deductible and payments made by government programs. These costs are funded as paid.

11.

Accumulated other comprehensive income (loss)

Accumulated other comprehensive income (loss) refers to revenues, expenses, gains and losses that under accounting principles generally accepted in the United States are recorded as an element of shareholders’ equity but are excluded from net income (loss). Terra’s accumulated other comprehensive income (loss) is comprised of (a) adjustments that result from translation of Terra’s foreign entity financial statements from their functional currencies to United States dollars, (b) adjustments that result from translation of intercompany foreign currency transactions that are of a long-term investment nature (that is, settlement is not planned or anticipated in the foreseeable future) between entities that are consolidated in Terra’s financial statements, (c) the offset to the fair value of derivative assets and liabilities (that qualify as hedged relationships) recorded on the balance sheet, and (d) pension and post-retirement benefit liabilities adjustments.

The components of accumulated other comprehensive income (loss), net of tax, for the nine months ended September 30, 2007 and 2006 follow:

		Foreign
		Currency								Pension and Post-
		Translation				Fair Value of				Retirement Benefit
(in thousands)		Adjustment				Derivatives				Liabilities				Total
Balance January 1, 2007		$	24,518			$	(11,836	)		$	(76,421	)		$	(63,739	)
Change in pension and post retirement benefit liabilities			—				—				1,913				1,913
Transfer of UK pension plan to GrowHow UK Limited			—				—				43,272				43,272
Change in foreign translation adjustment			(42,361	)			—				—				(42,361	)
Reclassification to earnings			—				(20,515	)			—				(20,515	)
Change in fair value of derivatives			—				17,950				—				17,950
Balance September 30, 2007		$	(17,843	)		$	(14,401	)		$	(31,236	)		$	(63,480	)
Balance January 1, 2006		$	(9,100	)		$	(5,109	)		$	(55,934	)		$	(70,143	)
Change in foreign translation adjustment			22,638				—				—				22,638
Reclassification to earnings			—				27,597				—				27,597
Change in fair value of derivatives			—				(32,454	)			—				(32,454	)
Balance September 30, 2006		$	13,538			$	(9,966	)		$	(55,934	)		$	(52,362	)

12.

Industry Segment Data

Terra classifies its operations into two business segments: nitrogen products and methanol. The nitrogen products business produces and distributes ammonia, urea, nitrogen solutions, ammonium nitrate and other products to farm distributors and industrial users. The methanol business manufactures and distributes methanol which is used in the production of a variety of chemical derivatives and in the production of methyl tertiary butyl ether (MTBE), an oxygenate and an octane enhancer for gasoline. Terra does not allocate interest, income taxes or corporate-related charges to business segments. Included in Other are general corporate activities not attributable to a specific industry segment.

The following summarizes operating results by business segment:

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
(in thousands)		2007				2006				2007				2006
Revenues - Nitrogen Products		$	571,518			$	442,612			$	1,739,001			$	1,355,574
- Methanol			18,528				18,921				41,839				25,510
- Other			3,669				3,248				8,976				6,135
Total revenues		$	593,715			$	464,781			$	1,789,816			$	1,387,219
Income (loss) from operations
- Nitrogen Products		$	123,676			$	20,409			$	315,978			$	25,098
- Methanol			(27,208	)			9,405				(25,646	)			3,363
- Other			(965	)			(426	)			(1,385	)			(1,017	)
Income (loss) from operations		$	95,503			$	29,388			$	288,947			$	27,444

The following summarizes geographic revenues information (See Note 8):

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
(in thousands)		2007				2006				2007				2006
United States		$	474,270			$	337,958			$	1,416,068			$	1,048,142
Canada			11,353				12,874				54,639				48,755
United Kingdom			108,092				113,949				319,109				290,322
		$	593,715			$	464,781			$	1,789,816			$	1,387,219

13.

Commitments and Contingencies

The Company is involved in various claims and legal actions arising in the ordinary course of business, including employee injury claims. Based on the facts currently available, management believes that the ultimate disposition of these matters will not have a material adverse effect on the Company’s consolidated financial position, results of operation or liquidity and that the likelihood that a loss contingency will occur in connection with these claims is remote.

The Company has entered into physical natural gas supply agreements through March 2009 for approximately 25.9 million MMBtu’s. As of September 30, 2007, these natural gas commitments were $1.4 million above the respective index prices.

14.

Share Information

On April 25, 2006, the Board of Directors authorized the Company to repurchase a maximum of 10 percent, or 9,516,817 shares, of its outstanding common stock. The stock buyback program has been and will be conducted on the open market, in private transactions or otherwise at such times prior to June 30, 2008, and at such prices, as determined appropriate by the Company. Purchases may be commenced or suspended at any time without notice. In 2006 there were 2.7 million shares repurchased for an aggregate cost of $18.8 million, which resulted in a balance of 6.8 million shares available for repurchase under the program.

During 2007, the Company repurchases under the stock program were:

(In thousands, except		Number of				Average Price				Total Cost of
average price of shares		Shares				of Shares				Shares
repurchased)		Repurchased				Repurchased				Repurchased
January 2007			—			$	—			$	—
February 2007			—				—				—
March 2007			—				—				—
April 2007			—				—				—
May 2007			650				18.79				12,220
June 2007			350				19.53				6,991
July 2007			200				25.53				5,067
August 2007			2,800				22.55				63,148
September 2007			—				—				—
Total			4,000			$	21.86			$	87,426

15.

New Accounting Pronouncements

In September 2006, the FASB issued SFAS 157, Fair Value Measurements, (SFAS 157). SFAS 157 is definitional and disclosure oriented and addresses how companies should approach measuring fair value when required by generally accepted accounting principles (GAAP); it does not create or modify any current GAAP requirements to apply fair value accounting. SFAS 157 provides a single definition for fair value that is to be applied consistently for all accounting applications, and also generally describes and prioritizes according to reliability the methods and input used in valuations. SFAS 157 prescribes various disclosures about financial statement categories and amounts which are measured at fair value, if such disclosures are not already specified elsewhere in GAAP. The new measurement and disclosure and requirements of SFAS 157 are effective for the Company in 2008 first quarter and the Company expects no significant impact from adopting the Standard.

In February 2007, the FASB issued Statement of Financial Accounting Standards (SFAS 159), The Fair Value Option for Financial Assets and Financial Liabilities (SFAS 159). SFAS 159 permits entities to choose to measure many financial instruments and certain other items at fair value at specified election dates. SFAS 159 is effective for the Company beginning in the first quarter of 2008. The Company is currently assessing the impact SFAS 159 may have on its financial statements.

16.

Subsequent Events

On October 9, 2007, GrowHow UK Limited (GrowHow) announced the closure of its Severnside manufacturing facilities. The closure is expected to be completed by the end of January 2008. GrowHow estimates the costs associated with severance to be approximately $26.5 million, which will impact the Company’s equity earnings from GrowHow during the 2007 fourth quarter.

Pursuant to the Joint Venture Contribution Agreement, the Company is responsible for any remediation costs required to prepare the Severnside site for disposal. The Company anticipates remediation costs to be approximately $5.0 million to $10.0 million; however, the Company also has an option to purchase the Severnside land for a nominal amount at any time prior to its sale. The Company anticipates that the proceeds related to the sale of the Severnside land would exceed the total cost of reclamation of the site.

17.

Guarantor Subsidiaries

The consolidating statement of financial position of Terra Industries Inc. (the “Parent”), Terra Capital, Inc. (“TCAPI”), the Guarantor Subsidiaries and subsidiaries of the Parent that are not guarantors of the Unsecured Senior Notes due 2017 for September 30, 2007; December 31, 2006; and September 30, 2006 are presented below for purposes of complying with the reporting requirements of the Guarantor Subsidiaries. Statements of operations and statements of cash flows for the nine months ended September 30, 2007 and 2006 are presented below for purposes of complying with the reporting requirements of the Guarantor Subsidiaries. The guarantees of the Guarantor Subsidiaries are full and unconditional. The Subsidiary issuer and the Guarantor Subsidiaries guarantees are joint and several with the Parent.

Guarantor subsidiaries include subsidiaries that own the Woodward, Oklahoma; Port Neal, Iowa; Yazoo City, Mississippi, and Beaumont, Texas plants as well as the corporate headquarters facility in Sioux City, Iowa. All guarantor subsidiaries are wholly owned by the Parent. All other company facilities are owned by non-guarantor subsidiaries.

Consolidating Balance Sheet as of September 30, 2007:

										Guarantor				Non-Guarantor
(in thousands)		Parent				TCAPI				Subsidiaries				Subsidiaries				Eliminations				Consolidated
Assets
Cash and cash equivalents		$	—			$	43,545			$	218,604			$	566,133			$	(467,804	)		$	360,478
Accounts receivable, net			—				—				97,989				61,916				—				159,905
Inventories			—				—				78,753				51,785				(4,384	)			126,154
Other current assets			2,075				537				7,516				4,811				(1,872	)			13,067
Total current assets			2,075				44,082				402,862				684,645				(474,060	)			659,604
Property, plant and equipment, net			—				—				311,535				123,569				(1	)			435,103
Equity method investments			—				—				10,917				358,688				—				369,605
Intangible assets, other assets and deferred plant turnaround costs			(1,839	)			8,326				23,854				30,253				(4,413	)			56,181
Investments in and advanced to (from) affiliates			589,662				344,748				1,459,277				—				(2,393,687	)			—
Total assets		$	589,898			$	397,156			$	2,208,445			$	1,197,155			$	(2,872,161	)		$	1,520,493
Liabilities
Accounts payable		$	2,298			$	(212	)		$	89,147			$	74,376			$	—			$	165,609
Accrued expenses and other current liabilities			36,314				3,549				37,913				20,357				(1,782	)			96,351
Total current liabilities			38,612				3,337				127,060				94,733				(1,782	)			261,960
Long-term debt and capital lease obligations			—				330,000				—				—				—				330,000
Pension and other liabilities			100,247				(511	)			14,167				(27,333	)			91,353				177,923
Minority interest			—				20,077				82,777				—				—				102,854
Total liabilities and minority interest			138,859				352,903				224,004				67,400				89,571				872,737
Preferred stock - liquidation value of 120,000			115,800				—				—				—				—				115,800
Common Shareholders’ Equity
Common stock			142,070				—				73				32,458				(32,532	)			142,069
Paid-in capital			617,085				150,218				1,949,997				1,173,391				(3,273,606	)			617,085
Accumulated other comprehensive income (loss)			(37,305	)			—				—				102,236				(128,411	)			(63,480	)
Accumulated deficit			(386,611	)			(105,965	)			34,371				(178,330	)			472,817				(163,718	)
Common shareholders’ equity			335,239				44,253				1,984,441				1,129,755				(2,961,732	)			531,956
Total liabilities and minority interest, preferred stock and common shareholders equity		$	589,898			$	397,156			$	2,208,445			$	1,197,155			$	(2,872,161	)		$	1,520,493