Acron to maintain capex at $180 mln in 2017
MOSCOW. April 4 (Interfax) - Acron , a major Russian mineral fertilizer producer, is planning to keep capital expenditures flat at $180 million in 2017, the company said in a presentation.
The main investments this year will be in construction of an underground mine at the Oleniy Ruchey operation in Murmansk Region, and 38 km of rail lines to the work site of the mine and processing plant, Acron deputy head of economics and finance Anton Ananyev said in a conference call. The cost of the project is estimated at 4.5 billion rubles.
Acron CFO Alexei Milenkov said that under the strategy to 2025 the company's investments will total "several hundred million dollars," not including the Talitsky potash project. The company will focus on projects that will enable it to process existing excess ammonia and apatite concentrate.
Acron is maintaining its dividend policy, which calls for paying out at least 30% of IFRS net profit to shareholders, Milenkov said. "The growth of our business sets the stage for increasing payments," he added.
Acron plans to increase commercial production by 12% to 7.3 million tonnes in 2017 by increasing processing of ammonia into nitrogen and complex fertilizers following the launch of a new facility in Veliky Novgorod. The company also plans to mine the first ore from the Oleniy Ruchey underground mine.
Acron investor relations director Ilya Popov said the company does not expect difficulties selling the new volume, since it sells most products - 50% to 80% depending on the product - under long-term contracts or through sales networks, rather than on the spot market.
Acron will focus on markets with strong growth potential, such as Russia, the United States, Latin America and Africa, he added.