-
Revenue increased to US $ 2,423 million, compared to US $ 2,080
million in 2011.
-
Operating profit increased to US $ 734 million, compared with US $
659 million in 2011.
-
Adjusted EBITDA grew to US $ 839 million, compared to US $ 750
million in 2011.
-
Net profit amounted to US $ 665 million, compared with US $ 445
million in 2011.
Moscow,
Russia (March 12, 2013) -- URALCHEM
HOLDING P.L.C. (hereinafter URALCHEM Holding or the
Company), a Cypriot holding company of the URALCHEM Group
(hereinafter the Group), one of the largest producers of nitrogen and
phosphate fertilizers in Russia, published its audited IFRS Financial
Statements for the year 2012.
Key Financial Figures of the Group for 2012 and 2011 (US $
million)
|
2012
|
2011
|
Increase
|
|
Revenue
|
2,423
|
2,080
|
16%
|
|
Gross profit
|
1,400
|
1,212
|
16%
|
|
Gross profit margin
|
58%
|
58%
|
-
|
|
Operating profit
|
734
|
659
|
11%
|
|
Operating profit margin
|
30%
|
32%
|
-6%
|
|
Net profit
|
665
|
445
|
49%
|
|
Net profit margin
|
27%
|
21%
|
29%
|
|
Adjusted EBITDA
|
839
|
750
|
12%
|
|
Adjusted EBITDA margin
|
35%
|
36%
|
-3%
|
|
Cash generated from operating activities
|
669
|
523
|
28%
|
Dmitry
Konyaev, CEO of URALCHEM, OJSC (a Russian holding company of the
Group), commented on the 2012 results, "Thanks to the programmes
for the modernization of production facilities, which we have
successfully implemented in recent years, as well as our efforts to
improve the management of the company, the year 2012 was a success
for URALCHEM Holding. During the year, we maintained an optimal
balance of production, oriented towards current demand, which allowed
us to be responsive to the needs of the market. These factors enabled
the company to show good operational and financial performance over
the past year."
Financial
Results
Revenue
for the year 2012 grew to US $ 2,423 million, compared to US $ 2,080
million in 2011. Operating profit amounted to US $ 734 million, or
30% of the revenue, compared with the operating profit of US $ 659
million, or 32% of the revenue in 2011. Net profit for the year 2012
amounted to US $ 665, compared to US $ 445 million in 2011.
During
the year 2012, adjusted EBITDA reached US $839 million, compared to
US $750 million the year before, a rise of 12%. Adjusted EBITDA
margin for the year 2012 comprised 35% of the revenue compared with
36% of the revenue for the year 2011.
Markets
After
the fall of the price of ammonia in the first quarter due to
lower demand from industrial consumers, prices started to recover in
late March and early April. This recovery occurred due to the delayed
launch of new facilities and close-down repairs at a number of major
enterprises in the Middle East, as well as restrictions on the supply
of gas in Trinidad. The same factors determined growth in prices
during the second and third quarters. In the fourth quarter, there
was a decline in prices associated with the reduction in demand from
the industrial consumers in the US, Asia, and North Africa. Over the
year, average prices for ammonia on the basis of FOB Yuzhny port grew
by 5.2% compared to the same period in 2011.
The
urea market remained relatively stable in the first half of the first
quarter. However, a sharp rise in prices began later, due to high
demand in the United States, backed by demand in Latin America and
India. In the second half of the second quarter, prices fell due to
the end of seasonal demand in the Northern Hemisphere. During the
third quarter, prices were relatively stable, with a tendency to
growth towards the end of the quarter, due to increased demand in
major markets, which coincided with the closure of a number of CIS
and the Middle East facilities for repairs. In the fourth quarter,
prices fell due to low buying activity. Overall, in the second half
of the year the market was under pressure from massive Chinese
exports. As a result, the average price of prilled urea on the basis
of FOB Yuzhny port decreased by 3.5% compared to 2011.
The
prices of ammonium nitrate in 2012 basically followed the
dynamics of the urea price. The price increase in the first quarter
was driven by demand in the domestic market of the CIS. Until the
middle of the second quarter, prices grew mainly due to the support
from price of urea. From the middle of the second quarter, prices
fell under the influence of the seasonal decrease in demand and also
the pressure of prices for urea. In the third quarter, prices were
relatively stable. Near the end of the quarter there was a strong
growth in prices due to the lack of available products as a result of
a number of enterprises switching to the production of commercial
ammonia, as well as due to increased demand in the domestic market of
the CIS. Falling prices in the first half of the fourth quarter is
associated with pressure from the price of urea. From the middle of
the quarter, there was a recovery in prices for ammonium nitrate in
the ports of the CIS because of redistribution of the product to the
domestic market, as well as switching of production to the
manufacture of ammonia. Overall for the year 2012, there was a 2%
decline in the prices of ammonium nitrate in the ports of CIS
compared to the average price in 2011.
During
the first quarter, the price of phosphate fertilizers slightly
decreased due to the extremely low market activity. In the second
quarter, the signing of the Indian contracts stabilized prices.
During the quarter, the market showed a moderate recovery due to
demand in Latin America and a number of "niche" markets.
The third quarter was characterized by stable prices and low market
activity. By the end of the quarter there was a tendency to a slight
decrease in prices due to lack of demand in the South Asian markets
and the purchasing tactics used by Latin American buyers based on
current needs. In the fourth quarter, the downward trend in prices
continued. The main reason for the decline in prices remained a lack
of demand from South Asia, the low demand activity in Latin America,
as well as increasing export supply from the US due to the end of the
phosphate season. In 2012 the price of phosphate fertilizers in the
CIS ports decreased by more than 12% compared to the average price in
2011.
Sales
Against
the background of steady high demand for the Group's fertilizers in
Russia and abroad, the sales in 2012 rose by 18% compared to 2011,
amounting to a total of 5,796 thousand tons. Sales of urea increased
by 128%, sales of commercial ammonia grew by 50%.
Sales of Commercial Products of URALCHEM Group in 2012-2011
(thousands of tons)
|
Name of Product
|
2012
|
2011
|
Increase
|
|
Ammonium nitrate and its derivatives
|
2,043
|
2,169
|
-6%
|
|
Urea
|
1,188
|
521
|
128%
|
|
Ammonia
|
673
|
449
|
50%
|
|
Phosphate fertilizers
|
508
|
543
|
-6%
|
|
Complex fertilizers
|
587
|
584
|
1%
|
|
Other chemicals, including ammonium nitrate for
industrial use
|
797
|
654
|
22%
|
|
Total
|
5,796
|
4,920
|
18%
|
Financial
Situation
Due
to the increase in revenue, cash generated from operating activities
amounted to US $669 million for the year 2012, compared to US $523
million the year before.
On
31 December 2012, the Company's net debt amounted to US $830 million
compared to US $931 million at the end of the previous year. The
weighted average interest rate in the loan portfolio of the Group for
the year 2012 amounted to 5.2% annually compared to 5.9% annually for
the year 2011.
-Ends-
For
more information, please visit the Company web site
http://www.uralchem.com
or use the following contact information:
PR
department
URALCHEM,
OJSC
Tel:
+7 (495) 721 89 89
URALCHEM
HOLDING P.L.C. is a holding company of the URALCHEM Group, which
includes four fertilizer manufacturing facilities in Russia. URALCHEM
Group is one of the largest producers of nitrogen and phosphate
fertilizers in Russia and the CIS with production capacities of over
2.5 million tons of ammonium nitrate, 2.8 million tons of ammonia,
0.8 million tons of MAP and DAP, 0.8 million tons of complex
fertilizers and 1.2 million tons of urea per year. URALCHEM Group is
the second largest ammonium nitrate producer in the world and number
one in Russia, the second largest producer of nitrogen fertilizers in
Russia. URALCHEM Group's key production assets include Azot Branch of
URALCHEM, OJSC in Berezniki, Perm Region; OJSC Minudobrenia, Perm;
MFP Kirovo-Chepetsk Chemical Works, OJSC Branch in Kirovo-Chepetsk,
Kirov region; Voskresensk Mineral Fertilizers, OJSC in Voskresensk,
Moscow region.
Some
of the information in this press release may contain projections or
other forward-looking statements regarding future events or the
future financial performance of URALCHEM. We wish to caution you that
these statements are only predictions. We do not intend to update
these statements and our actual results may differ materially from
those contained in our projections or forward-looking statements,
including, among others, the achievement of anticipated levels of
profitability, growth, cost and synergy of our recent acquisitions,
the impact of competitive pricing, the ability to obtain necessary
regulatory approvals and licenses, the impact of developments in the
Russian economic, political and legal environment, financial risk
management and the impact of general business and global economic
conditions.
Annex
to the press release about the audited financial results for the year
2012
EBITDA
is a profit / loss from financial and economic activities during the
reporting period, before deduction of income tax on profits, income
and interest costs, depreciation and amortization. "Adjusted
EBITDA" is EBITDA for the reporting period before goodwill,
profit / loss from associates, profit / loss on foreign exchange
differences arising on financial performance and profit / loss on
operations with derivative financial instruments. Adjusted EBITDA is
operating profit before depreciation and amortization and financial
results of operations with derivative financial instruments. In
accordance with International Financial Reporting Standards ("IFRS"),
depreciation and amortization are included in cost structure, and in
the selling, general and administrative expenses. IFRS does not
require the disclosure and does not describe the calculation of
EBITDA and adjusted EBITDA, among other financial indicators, so they
can not substitute for net profit for the period when evaluating the
results of operations or the measure of cash provided by operating
activities when evaluating liquidity. Approach to the calculation of
EBITDA and adjusted EBITDA, as described earlier, may not coincide
with the approaches used by other companies, therefore, comparability
may be limited. We believe that EBITDA and adjusted EBITDA provide
useful information to investors because they are indicators of the
stability and efficiency of our business and our ability to fund
discretionary spending such as capital expenditures, the acquisition
of subsidiaries and other investments, as well as indicators of our
ability to incur and service debt. IFRS classifies depreciation and
amortization to operating costs, while in fact they are distributed
to the current period non-cash expenses for the acquisition or
creation of fixed assets, incurred in previous periods, and are not
affiliated with the movement of funds.
Calculation
of EBITDA for the years 2012 and 2011 (Thousands of US dollars)
|
|
2012
|
2011
|
|
|
Net profit
|
664,945
|
444,646
|
|
|
Add:
Income tax
Interest and other
financial income
Interest and other
financial costs
Amortisation
|
|
|
|
137,846
|
113,261
|
|
|
(12,918)
|
(3,289)
|
|
|
77,673
|
115,346
|
|
|
104,748
|
90,727
|
|
Share of profit of associates
|
(293)
|
(49,541)
|
|
Gain on change
in fair value
of the share in
the associate
|
(153,458)
|
-
|
|
|
Revaluation of goodwill
|
76,450
|
-
|
|
Foreign exchange gain from financing
activities
|
(56,454)
|
38,957
|
|
|
Adjusted EBITDA
|
838,539
|
750,107
|
|
