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Wednesday 06 February, 2019

OJSC PhosAgro

PhosAgro FY 2018 Fertilizer & MCP Output Rose 8% y-o-y to 9.0 mln t

OJSC PhosAgro (PHOR)
PhosAgro FY 2018 Fertilizer & MCP Output Rose 8% y-o-y to 9.0 mln t

06-Feb-2019 / 10:30 CET/CEST
Dissemination of a Regulatory Announcement that contains inside information according to REGULATION (EU) No 596/2014 (MAR), transmitted by EQS Group.
The issuer / publisher is solely responsible for the content of this announcement.


For Immediate Release

06 February 2019

 

 

PhosAgro FY 2018 Fertilizer & MCP Output Rose 8% y-o-y to 9.0 mln t

 

Moscow - PhosAgro (MOEX/LSE ticker: PHOR), one of the world's leading vertically integrated phosphate-based fertilizer producers, increased its FY 2018 fertilizer and feed phosphates production by 7.6% year-on-year to 9.0 million tonnes. Sales for the same period grew by 9.0% year-on-year to 8.8 million tonnes. In 4Q 2018, fertilizer production rose by 1.8% year-on-year to 2.3 million tonnes while sales marginally decreased by 2.4% year-on-year to 2.0 million tonnes.

 

PhosAgro's production and sales volumes are summarised in the tables below.

 

Production volumes by type

('000 mt)

4Q 2018

4Q 2017

Chg y/y

FY 2018

FY 2017

Chg y/y

Phosphate-based & MCP

1,741.0

1,692.3

2.9%

6,852.0

6,603.5

3.8%

Nitrogen-based

553.0

561.5

-1.5%

2,123.0

1,734.6

22.4%

Total fertilizers

2,294.0

2,253.8

1.8%

8,975.0

8,338.1

7.6%

PhosRock & nepheline

2,807.0

2,641.0

6.3%

11,053.0

10,538.4

4.9%

Other products

52.3

30.4

72.0%

204.0

122.6

66.4%

 

Sales volumes by type

('000 mt)

4Q 2018

4Q 2017

Chg y/y

FY 2018

FY 2017

Chg y/y

Phosphate-based & MCP

1,492.4

1,599.2

-6.7%

6,634.9

6,484.8

2.3%

Nitrogen-based

470.4

410.7

14.5%

2,195.6

1,615.8

35.9%

Total fertilizers

1,962.8

2,009.9

-2.3%

8,830.5

8,100.6

9.0%

PhosRock & nepheline

1,102.0

1,000.2

10.2%

3,947.3

3,734.0

5.7%

Other products

47.6

34.0

40.1%

182.3

134.7

35.3%

 

Commenting on the FY 2018 operating results, PhosAgro CEO Andrey Guryev said:

 

"The fact that 2018 was PhosAgro's best year ever in terms of production at both the upstream and downstream divisions is something we are all proud of. We achieved our ambitious production guidance of 9 million tonnes for the year, though we have no intention to rest after delivering a strong set of results for 2018, and we plan to increase further the production of fertilizers by up to 5% in 2019. Thanks to our sales strategy that aims to be 'closer to our customer,' PhosAgro made further progress on widening its direct access to priority markets, bolstering sales by 9% year-on-year. Finally, after the first full year of operations of PhosAgro's new ammonia unit, our production site at Cherepovets is now fully self-sufficient in this crucial feedstock, which has solidified our leadership position on the industry cash cost curve."

 

In 4Q 2018, PhosAgro's output of phosphate-based products was up by 2.9% y-o-y to 1.7 million tonnes, primarily driven by higher MAP production (up by 24% year-on-year), which was made possible by the successful modernisation of midstream capacities (both phosphoric and sulphuric acid) in Balakovo. Phosphate rock output in 4Q 2018 increased by 7% year-on-year to 2.6 million tonnes following completion of the modernisation programme at Beneficiation Plant #3. In FY 2018, underground mining accounted for almost 80% of all mining work and had a positive impact on our phosphate rock cash cost (underground mining is nearly two times cheaper than open-pit mining). Ammonia production was down by 8% year-on-year in the fourth quarter due to scheduled maintenance work.

 

Sales of fertilizers rose by 9% year-on-year to 8.8 million tonnes in FY 2018. The strongest growth was in North America, where sales rose by 78% year-on-year to 1.1 million tonnes due to a deficit of phosphates following the closure of capacities in Florida. Shipments to Latin America increased by 24% year-on-year to 2.0 million tonnes in FY 2018, thanks to our strong sales of nitrogen-based products (up by 59% year-on-year) directly to end-customers. European sales rose by 11% year-on-year to 2.1 million tonnes, driven by our strategic approach to move deeper into the distribution chain and expand our on-the-ground presence with new local offices. Volumes in Russia, our priority domestic market, were up slightly, by 5% year-on-year to 2.4 million tonnes in FY 2018.

 

Looking ahead to 2019 market conditions, the fertilizer industry traditionally starts the new year with the off-season slowdown putting pressure on prices. We believe that prices for phosphate-based fertilizers will remain under pressure throughout 1Q 2019. A recovery in prices are expected in 2Q 2019, driven by the beginning of the spring application season in major agricultural regions. Overall, price dynamics in 2019 should be flattish, amid more stable global fertilizer supply than in 2018.

 

The table below provides a breakdown of production volumes by major product:

 

Production volumes by type

('000 mt)

4Q 2018

4Q 2017

Chg y/y

FY 2018

FY 2017

Chg y/y

Apatit mine and beneficiation plant

Phosphate rock

2,552.7

2,379.2

7.3%

10,067.0

9,540.4

5.5%

Nepheline concentrate

254.3

261.8

-2.9%

986.0

998.1

-1.2%

Phosphate-based fertilizers

DAP/MAP

774.7

729.7

6.2%

2,995.0

3,004.0

-0.3%

NPK

692.8

692.9

0.0%

2,799.0

2,566.5

9.1%

NPS

120.7

134.9

-10.5%

419.0

423.4

-1.0%

APP

53.6

40.0

34.0%

216.0

155.4

39.0%

MCP

92.4

78.3

18.0%

356.0

354.4

0.5%

PKS

6.8

16.5

-58.8%

67.0

99.8

-32.9%

Nitrogen-based fertilizers

AN

153.1

140.8

8.7%

533.0

496.4

7.4%

Urea

399.9

420.7

-4.9%

1,590.0

1,238.2

28.4%

Other products

STPP

26.8

18.3

46.4%

105.0

72.9

44.0%

Other

25.5

12.1

110.7%

99.0

49.7

99.2%

Feedstock

Ammonia

465.0

503.4

-7.6%

1,866.0

1,454.9

28.3%

Phosphoric acid

622.6

591.6

5.2%

2,546.0

2,469.2

3.1%

Sulphuric acid

1,444.4

1,390.4

3.9%

5,732.0

5,437.8

5.4%

 

 

The table below provides a breakdown of sales volumes by major product:

 

Sales volumes by type

('000 mt)

4Q 2018

4Q 2017

Chg y/y

FY 2018

FY 2017

Chg y/y

Apatit mine and beneficiation plant

Phosphate rock

844.9

734.1

15.1%

2,964.2

2,732.2

8.5%

Nepheline concentrate

257.1

266.1

-3.4%

983.1

1,001.8

-1.9%

Phosphate-based fertilizers

DAP/MAP

645.1

695.8

-7.3%

2,912.6

2,963.9

-1.7%

NPK

603.7

570.5

5.8%

2,664.6

2,488.8

7.1%

NPS

101.4

199.9

-49.3%

423.5

409.8

3.3%

APP

54.5

35.2

54.8%

209.4

170.7

22.7%

MCP

84.4

90.0

-6.2%

347.2

350.4

-0.9%

PKS

3.3

7.8

-57.7%

77.6

101.2

-23.3%

Nitrogen-based fertilizers

AN

136.2

76.7

77.6%

595.3

476.0

25.1%

Urea

334.2

334.0

0.1%

1,600.3

1,139.8

40.4%

Other products

STPP

23.0

20.9

10.0%

98.6

81.1

21.6%

Other

24.6

13.1

87.8%

83.7

53.6

56.4%

 

 

For further information please contact:

PhosAgro

Alexander Seleznev, Head of Investor Relations Department
+7 495 232 9689 ext 2187
[email protected]

Timur Belov, Press Officer
+7 495 232 9689

EM
Sam VanDerlip
[email protected]
+44 7554 993 032

Dmitriy Zhadan

[email protected]

+7 916 770-89-09

About the Company

PhosAgro is one of the world's leading vertically integrated phosphate-based fertilizer producers in terms of production volumes of phosphate-based fertilizers and high-grade phosphate rock with a P2O5 content of 39% and higher.

The Company is the largest phosphate-based fertilizer producer in Europe (by total combined capacity for DAP/MAP/NP/NPK/NPS), the largest producer of high-grade phosphate rock with a P2O5 content of 39%, a top-three producer of MAP/DAP globally, one of the leading producers of feed phosphates (MCP) in Europe, and the only producer in Russia, and Russia's only producer of nepheline concentrate (according to the RAFP).

PhosAgro's main products include phosphate rock, 39 grades of fertilizers, feed phosphates, ammonia, and sodium tripolyphosphate, which are used by customers in 100 countries spanning all of the world's inhabited continents. The Company's priority markets outside of Russia and the CIS are Latin America, Europe and Asia.

PhosAgro's shares are traded on the Moscow Exchange, and Global Depositary Receipts (GDRs) for shares trade on the London Stock Exchange (under the ticker PHOR). Since 1 June 2016, the Company's GDRs have been included in the MSCI Russia and MSCI Emerging Markets indexes.

More information about PhosAgro can be found on the website: www.phosagro.ru.

 



ISIN: US71922G2093
Category Code: TST
TIDM: PHOR
LEI Code: 635400F8A3KGJIIBIK95
OAM Categories: 2.2. Inside information
Sequence No.: 7385
EQS News ID: 772977

 
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