16 November 2012 16:41 [Source: ICIS news]
LONDON (ICIS)--Soaring demand for urea and ammonia helped Russia's Uralchem almost double its nine-month net profit to $600m (€468m) from $318m reported in the same period of 2011 on strong double-digit sales growth, the fertilizer producer revealed on Friday.
The group's Cypriot-headquartered parent, Uralchem Holding, attributed the impressive 89% jump in net income for the January-September period to a 16% year-on-year rise in revenue to $1.80bn from $1.56bn.
In volume terms, urea sales in the first nine months of 2012 surged to 904,000 tonnes from 371,000 tonnes during the same period the year before, while ammonia sales advanced 54% year on year to 503,000 tonnes, Uralchem said.
Sales of ammonium nitrate (AN) and its derivatives in the first nine months slipped 6% year on year to 1.58m tonnes, while sales of phosphate fertilizers fell 14% to 344,000 tonnes and total NPK (nitrogen phosphorous potassium) sales dipped 5% to 464,000 tonnes.
In addition, sales of other chemicals, including AN for industrial use, increased 19% to 566,000 tonnes.
"During Q3 [the third-quarter] 2012, price dynamics for fertilizers and intermediate products were different," said Uralchem. "Prices for ammonia in Q3 showed a significant increase due to growing demand and limited supply. During these three months, the price level rose $50/tonne and reached $650/tonne FOB (free on board) Port of Yuzhny by the end of September.
"In the absence of a strongly marked trend, the urea market was characterized by high volatility. Prices have not shown any significant increase or noticeable reduction, remaining within the limits of $360-400/t FOB the ports of the CIS. Ammonium nitrate prices mainly matched the dynamics of urea prices during Q3.
"The global market for phosphate fertilizers in Q3 showed low levels of activity. In September, there has been a downward trend in prices amid a lack of demand in South Asia (India, Pakistan)," it added.
Uralchem CEO, Dmitry Konyaev, said he was pleased with the results which "showed steady improvement of its financial performance" compared with the same period of 2011.
"To this contributed the acquisition earlier this year of another production unit, Minudobrenia, located in Perm, and rising world prices for our main products, ammonia and urea," he said. "Looking back at the first nine months, we are optimistic about the full-year results for 2012."
On Thursday, Uralchem revealed ammonia output for the nine month period jumped 9% to 577,561 tonnes from 530,100 tonnes in the year-ago period, while urea output climbed 8% year on year to 856,546 tonnes.
The group added total NPK fertilizer output edged up 4% year on year to 462,111 tonnes and it had concentrated on “high-margin products”.
($1 = €0.78)
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