PhosAgro boosts Q3 EBITDA 46% to 9.5 bln rubles, above forecast
MOSCOW. Nov 19 (Interfax) - PhosAgro boosted earnings before taxes, depreciation and amortization (EBITDA) 46% year-on-year in Q3 2014 to 9.5 billion rubles, the fertilizer producer said in a statement.
This was higher than the 9.28 billion rubles that analysts predicted in a consensus forecast for Interfax.
EBITDA grew 24% to 25.8 billion rubles in January-September. The EBITDA margin rose to 30%, from 26% in the same period of last year.
Net profit fell 31% to 6.3 billion rubles and the exchange-rate loss was 9.5 billion rubles.
Net loss was 1.8 billion rubles in Q3, compared with profit of 3.9 billion rubles a year previously.
Phosagro's net debt rose 20% during the 9M to 52.7 billion rubles. Net debt/EBITDA fell to 1.5 from 1.8. Gross debt rose to 73.3 billion rubles from 52.8 billion rubles during the 9M.
"Most of the company's debt is denominated in USD as a natural hedge against primarily USD-denominated sales. The depreciation of the Russian ruble against the US dollar was the primary reason for the increase of PhosAgro's net debt in rubles terms," the company said.
Revenue for 9M increased by 7% year-on-year to 86.8 billion rubles. Favourable market conditions led to higher prices year-on-year for most PhosAgro products. Cost savings in cost of sales also contributed to PhosAgro's strong operating profit result for 9M 2014: operating profit for the period was 19.7 billion up 32% from 9M 2013.
"Healthy global demand for phosphate-based fertilizers has pushed DAP prices to $500 per tonne FOB Tampa and higher in Q3 2014. The average DAP FOB Tampa price for the first nine months of 2014 was up 2% year-on-year to $475, compared to an average of $466 last year. While current DAP prices have softened to around $455 FOB Tampa as a result of the seasonal slowdown, they are still about $100 per tonne higher than they were at this time last year," said Andrei Guryev, CEO.
Phosphate-based products segment revenue increased by 5% year-on-year to 74.233 billion rubles The company said it had substantially increased sales sales of both concentrated fertilizers and NPKs to Latin America and Russia.
MAP fertilizer exports increased by 54% year-on-year, with price increases in rubles terms of 10%. This was offset by a 48% decrease in DAP exports. Domestic MAP sales increased by 37% year-on-year. Revenue from DAP/MAP sales increased by 16% year-on-year to 29.464 billion rubles in 9M 2014, representing an overall 5% year-on-year increase in sales volumes and 10% increase in DAP/MAP average revenue per tonne denominated in rubles.
Domestic NPK sales volumes increased by 36% year-on-year, which partially compensated for weaker domestic NPK prices during 9M 2014. As a result, revenue from domestic NPK sales increased by 32% year-on-year to 8.578 billion rubles in 9M 2014. Revenue from NPK export sales decreased by 10% year-on-year to 9.185 billion rubles in 9M 2014, as a result of a 13% year-on-year decline in NPK export sales volumes, which was partially compensated by a 3% increase in revenue per tonne denominated in rubles.
Total sales of phosphate rock decreased by 20% year-on-year to 10.828 billion rubles in 9M 2014 due to higher internal consumption of phosphate rock by PhosAgro production sites and lower phosphate rock production volumes as a result of the optimisation of mining operations.
The phosphate-based products segment's gross profit for 9M 2014 increased by 22% year-on-year to 30.011 billion rubles, resulting in a gross profit margin of 40%, compared to a 35% margin in 9M 2013, which was the result of higher sales combined with cost savings.
Nitrogen segment revenue increased by 23% year-on-year to 12.018 billion rubles in 9M 2014. Production and sales volumes of nitrogen-based fertilizers increased by 12% and 16% year-on-year, respectively, in 9M 2014. Export revenue from urea increased by 24% year-on-year from to 8.271 billion in 9M 2014, in line with the 22% increase in sales volumes. Ammonium nitrate (AN) sales volumes decreased by 5% year-on-year, which, combined with a 2% decrease in revenue per tonne, was the major factor behind the 7% decline in revenue from AN sales to 1.799 billion rubles in 9M 2014.