OJSC PhosAgro (PHOR)
PhosAgro Boosts Fertilizer Production to a Record 9.5 Million Tonnes in 2019
29-Jan-2020 / 12:00 MSK
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For Immediate Release
PhosAgro Boosts Fertilizer Production to a Record 9.5 Million Tonnes in 2019
Moscow, Russia - 29 January 2020 - PhosAgro (MOEX/LSE ticker: PHOR), one of
the world's leading vertically integrated phosphate-based fertilizer
producers, announces that its 4Q 2019 fertilizer sales volumes increased by
16% year-on-year to 2.3 million tonnes.
Total fertilizer production in 4Q 2019 increased by 2.8% year-on-year to
2,358.9 kt. Fertilizer and feed phosphate output for FY 2019 grew by 6.1%
year-on-year to a record 9,521.8 kt.
Phosphate rock and nepheline concentrate production in 4Q 2019 rose by 3.2%
year-on-year to 2,897.0 kt. For FY 2019, the output of phosphate rock and
nepheline concentrate was up by 5.8% year-on-year and reached 11,694.7 kt.
Sales of phosphate-based fertilizers in 4Q 2019 grew by 16.6% year-on-year
to 1,738.4 kt. Sales of phosphate-based fertilizers for FY 2019 increased by
9.4% year-on-year and reached 7,255.0 kt.
Sales of nitrogen fertilizers in 4Q 2019 rose by 14.5% year-on-year and
amounted to 537.1 kt. Sales of nitrogen fertilizers for FY 2019 increased by
0.1% year-on-year and amounted to 2,197.3 kt.
Sales of phosphate rock and nepheline concentrate in 4Q 2019 grew by 4.6%
year-on-year and amounted to 1,152.9 kt. For FY 2019, sales of phosphate
rock and nepheline concentrate increased by 12.6% year-on-year and amounted
to 4,446.2 kt.
PhosAgro production and sales volumes
Production volume by category
(kt) 4Q 4Q 2018 Chg y/y FY 2019 FY 2018 Chg y/y
2019
Phosphate-based 1,780. 1,741.0 2.3% 7,271.3 6,852.0 6.1%
& MCP 3
Nitrogen-based 578.6 553.0 4.6% 2,250.5 2,123.0 6.0%
TOTAL 2,358. 2,294.0 2.8% 9,521.8 8,975.0 6.1%
fertilizers 9
Phosphate rock 2,897. 2,806.7 3.2% 11,694. 11,052. 5.8%
and nepheline 0 7 6
concentrate
Other products 44.6 52.3 -14.8% 177.5 204.0 -13.0%
Sales volumes by category
(kt) 4Q 4Q 2018 Chg y/y FY 2019 FY 2018 Chg y/y
2019
Phosphate-based 1,738. 1,491.5 16.6% 7,255.0 6,634.7 9.4%
& MCP 4
Nitrogen-based 537.1 469.2 14.5% 2,197.3 2,195.6 0.1%
TOTAL 2,275. 1,960.7 16.1% 9,452.4 8,830.2 7.1%
fertilizers 5
Phosphate rock 1,152. 1,102.1 4.6% 4,446.2 3,947.3 12.6%
and nepheline 9
concentrate
Other products 48.2 47.6 1.3% 185.6 182.3 1.8%
Commenting on the 4Q and FY 2019 operating results, PhosAgro CEO Andrey
Guryev said:
"The Company continued its steady development in 2019 by unlocking the
potential created during the previous investment cycle. Stable demand in our
primary sales markets during the year made it possible to increase
production volumes at our production facilities, and a balanced approach to
ordinary maintenance enabled us to mitigate seasonal fluctuations in sales
of our end product.
"As a result, fertilizer production surpassed 9.5 million tonnes in 2019,
which was fully in line with the Company's announced production guidance.
This is a record level for us.
"Fertilizer production grew together with higher production volumes of
feedstocks like phosphate rock, ammonia, sulphuric acid and phosphoric acid,
which enabled us to maintain our self-sufficiency in these key inputs and
guaranteed our cost advantage, thus increasing our global competitive
position.
"PhosAgro's flexible sales model enabled us to increase sales in 2019 to
priority sales markets. For example, sales to the Russian and CIS markets
grew by more than 10% year-on-year, exceeding 3 million tonnes, and sales to
the European market over the same period increased by 28% to more than 2.6
million tonnes. As a result of this growth, these markets accounted for more
than 32% and 28% of total sales volumes, respectively.
"Looking at fertilizer prices in late 2019 and early 2020, I would note that
the price correction we saw throughout 2019 led to a large part of global
producers reaching marginal profitability levels, which made the market more
rational. This has laid the foundation for price growth in anticipation of
seasonal recovery in demand."
Production volumes by type
Production volumes by category
(kt) 4Q 4Q 2018 Chg y/y FY FY 2018 Chg
2019 2019 y/y
Apatit mine and beneficiation plant
Phosphate 2,606. 2,552.7 2.1% 10,506 10,067.0 4.4%
rock 9 .6
Nepheline 290.1 254.0 14.2% 1,188. 985.7 20.5%
concentrat 1
e
TOTAL 2,897. 2,806.7 3.2% 11,694 11,052.6 5.8%
0 .7
Phosphate-based fertilizers
DAP/MAP 771.6 774.7 -0.4% 3,202. 2,995.0 6.9%
9
NPK 672.7 692.8 -2.9% 2,770. 2,799.0 -1.0%
4
NPS 155.3 120.7 28.6% 643.8 419.0 53.6%
APP 59.9 53.6 11.8% 193.4 216.0 -10.4%
MCP 99.3 92.4 7.5% 367.7 356.0 3.3%
PKS 21.5 6.8 216.1% 93.0 67.0 38.9%
TOTAL 1,780. 1,741.0 2.3% 7,271. 6,852.0 6.1%
fertilizer 3 3
s
Nitrogen-based fertilizers
AN 165.8 153.1 8.3% 566.4 533.0 6.3%
Urea 412.8 399.9 3.2% 1,684. 1,590.0 5.9%
1
TOTAL 578.6 553.0 4.6% 2,250. 2,123.0 6.0%
fertilizer 5
s
Other products
STPP 25.6 26.8 -4.5% 98.9 105.0 -5.8%
Other 19.0 25.5 -25.6% 78.5 99.0 -20.7%
TOTAL 44.6 52.3 -14.8% 177.5 204.0 -13.0%
other
products
Feedstocks
Ammonia 460.1 465.0 -1.0% 1,930. 1,866.0 3.4%
2
Phosphoric 663.9 622.6 6.6% 2,701. 2,546.0 6.1%
acid 4
Sulphuric 1,512. 1,444.4 4.7% 6,123, 5,732.0 6.8%
acid 2 0
TOTAL 2,176. 2,067.0 5.3% 8,824. 8,278.0 6.6%
feedstocks 2 4
In 4Q 2019, production in the phosphate and nitrogen segments increased by
2.3% and 4.6% year-on-year, respectively, due to an increase in productivity
following the completion of technical upgrades at the Company's production
facilities in Cherepovets and Balakovo at the end of the last year. This
growth was partially limited by the large volume of scheduled maintenance
conducted in 4Q 2019, which were moved to the end of the year amid
expectations of a seasonal slowdown in demand.
Sulphuric acid production increased by 4.7% year-on-year to 1,512.2 kt due
to upgrades to one of the production lines in Cherepovets in December 2018.
Sales volumes by type
Sales volumes by category
(kt) 4Q 2019 4Q 2018 Chg y/y FY 2019 FY 2018 Chg y/y
Apatit mine and beneficiation plant
Phosphate 857.9 845.0 1.5% 3,256.4 2,964.2 9.9%
rock
Nepheline 295.0 257.2 14.7% 1,189.8 983.1 21.0%
concentrat
e
TOTAL 1,152.9 1,102.1 4.6% 4,446.2 3,947.3 12.6%
Phosphate-based fertilizers
DAP/MAP 694.8 644.5 7.8% 3,204.6 2,912.6 10.0%
NPK 670.2 603.4 11.1% 2,775.7 2,664.4 4.2%
NPS 177.6 101.4 75.1% 616.0 423.5 45.4%
APP 64.9 54.5 19.1% 198.4 209.4 -5.3%
MCP 122.9 84.4 45.6% 377.4 347.2 8.7%
PKS 8.1 3.3 142.2% 82.9 77.6 6.9%
TOTAL 1,738.4 1,491.5 16.6% 7,255.0 6,634.7 9.4%
fertilizer
s
Nitrogen-based fertilizers
AN 115.0 136.2 -15.5% 506.4 595.3 -14.9%
Urea 422.0 333.0 26.7% 1,690.9 1,600.3 5.7%
TOTAL 537.1 469.2 14.5% 2,197.3 2,195.6 0.1%
fertilizer
s
Other products
STPP 25.9 23.0 12.2% 103.5 98.6 4.9%
Other 22.4 24.5 -8.9% 82.2 83.7 -1.8%
TOTAL 48.2 47.6 1.3% 185.6 182.3 1.8%
other
products
In 4Q 2019, PhosAgro's fertilizer sales rose by 16.1% year-on-year to
2,275.5 kt thanks to the favourable price ratio for agricultural products
and fertilizers. Another factor behind the substantial increase in sales was
the low base effect from 4Q 2018, when transport restrictions in Europe
prevented the complete sale of traders' stocks.
In 4Q 2019, sales of phosphate-based fertilizers grew by 16.6% year-on-year
to 1,738.4 kt, mainly driven by increased sales of NPK and NPS fertilizers,
which enjoyed more stable prices compared to DAP/MAP, and the premium for
nutrients increased. Thus, the share of NPK(S) grades in the phosphate
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