Yara’s Q4 profits rise 187% on higher prices

14 February 2008 09:18  [Source: ICIS news]

SINGAPORE (ICIS news)--Yara International has posted a 186.8% year-on-year surge in fourth-quarter operating income, due to improved fertilizer prices, strong volume growth and a gain on the establishment of the Yara Praxair joint venture, the Norwegian fertilizer company said on Thursday.

 

It reported fourth-quarter operating income of Norwegian krone (NKr) 1.5bn ($274.2m) in 2007, compared with NKr521m the previous year, while revenue rose 40% to NKr17.4bn.

 

“We continue to deliver [a] strong financial performance with further margin improvements and volume growth,” said Thorleif Enger, company president and CEO.

 

“The global fertilizer market is tight with growing demand and limited new capacity, resulting in substantial fertilizer price increases to balance the market. The price increases have more than compensated for higher energy costs,” he added.

 

Fourth-quarter net income after minority interest jumped 129.4% to NKr2bn (NKr7.01 per share).

 

The company’s operating income for the full year rose 48.7% to NKr5bn compared with 2006 while revenues rose 19.1% to NKr57.5bn.

 

Full-year net income after minority interest grew 44.1% year-on-year to NKr6bn (NKr 20.60 per share.

 

Fourth-quarter fertilizer sales excluding new acquisition Kemira GrowHow were up 10% from last year, primarily reflecting a strong market in Europe, Yara said.

 

The industrial segment continued its rapid growth with sales of environmental products for nitrogen oxides (NOX) abatement rising 48% from last year driven by stricter legislation, it added.

 

Technical ammonium nitrate - for use in explosives - sales increased 18% amid booming mining activity, the company said.

 

The industrial segment realised a one-off gain of NKr795bn in the quarter with the establishment of the Yara Praxair joint venture, Yara said.

 

The firm said it expected European energy costs in the first half of 2008 to be substantially higher than last year but added current fertilizer price levels would more than compensate for higher costs.

 

The integration of Finnish rival Kemira GrowHow was on track, the company added.

 

($1 = NKr5.47)

 

By: Jeanne Lim
+65 6780 4359

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