19 August 2013 15:17 [Source: ICIS news]
LONDON (ICIS)--Uralchem saw its first-half net profit slide 43% to $253m (€189.8m) with its performance squeezed by a less favourable global market environment and rising raw material costs, the Russia-based nitrogen and phosphate fertilizer producer said on Monday.
Revenue edged up 2% year on year to $1.3bn (€975m), while operating profit fell 4% to $394m, it added.
In comments on the first-half earnings, Uralchem CEO Dmitry Konyaev said :“The overall global market situation has been less favourable for fertilizer producers in 2013 compared to last year.
“This trend is very likely to continue in the second half of this year. Along with the continuing rise in the cost of raw materials, this situation creates conditions for the further decline in the financial performance of the leading manufacturers of mineral fertilizers,” he added.
During the first six months of this year, Uralchem was able to reduce its debt to a record low of $787m and withdraw all its property from collateral arrangements thanks to the early repayment of loans amounting to $300m, Konyaev added.
The company noted that during the first half it was hit by a decline in the price of ammonia, partly because of lower demand in the agricultural segment due to the late start of the sowing season in the northern hemisphere.
Looking at the urea market, Uralchem said: “Urea prices showed significant growth at the beginning of the year due to active procurement in Europe and North America, which coincided with a limited supply of product from Egypt, forcing buyers to look for alternative sources.
“However, from mid-February to the end of June prices have been decreasing, mainly due to lack of demand,” the company added.
($1 = €0.75)
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