- Strong fertilizer demand in first quarter of 2013
- Above-average de-icing salt business in Europe
- Revenues rise to € 1.28 billion (+ 19 %)
- At € 277.9 million, operating earnings EBIT I up 12 % year on year
- 2013 outlook confirmed: Slight increase expected in revenues and operating earnings
“We have made a very decent start to the new year,” said Norbert Steiner, Chairman of the Board of Executive Directors of K+S Aktiengesellschaft, speaking at today’s Annual General Meeting of the Company in Kassel. “Our Potash and Magnesium Products business unit achieved its best first quarter so far.” Following the conclusion of contracts by North American and Russian producers with Chinese and Indian customers at the beginning of the year, demand for fertilizers rose significantly again in time for the start of the spring season in Europe and North America as well as in South America and South East Asia and prices stabilised. “In the Salt business unit, continued wintry weather in Europe at the start of the year resulted in above-average demand for de-icing salt, which was significantly above the low level of the same period a year ago,” Steiner continues. In the United States and in Canada, demand normalised following an extraordinarily mild winter in the same quarter a year ago.
Revenues rise significantly
In the first quarter, revenues of the K+S Group rose by € 199.7 million to € 1.28 billion, an increase of 19 % on the figure for the same period a year ago. On the one hand, this development can be attributed to a volume-related increase in revenues in the Potash and Magnesium Products business unit that could more than offset a moderate price decrease. On the other hand, the Salt business unit, too, could increase its revenues significantly as a result of volume factors. Totalling 8.91 million tonnes, sales volumes of crystallised salt were up 44 % on what was a below-average figure for the same period a year ago (Q1/12: 6.18 million tonnes).
In the first three months of 2013, 49 % of the K+S Group’s revenues were generated by the Potash and Magnesium Products business unit, followed by the Salt business unit (48 %) and the Complementary Activities (about 3 %). In Europe, the K+S Group posted a revenue share of approximately 43 % while North America accounted for 34 %. About 11 % of revenues were generated in South America and 10 % in Asia.
Operating earnings improve by 12 %
In the first quarter of 2013, operating earnings EBIT I increased by € 30.2 million or 12 % to € 277.9 million. In the Potash and Magnesium Products business unit, the volume-related increase in revenues, price-related cost reductions as well as positive currency effects could more than offset the effect from changes in inventories as well as higher depreciation and amortisation. In the Salt business unit, the above-average de-icing salt business in Europe caused operating earnings to rise compared with the exceptionally weak quarter of a year ago.
Adjusted Group earnings from continued operations also up on a year ago
In the first quarter, adjusted Group earnings from continued operations rose by € 21.9 million or 13 % to € 190.2 million (Q1/12: € 168.3 million). In the quarter under review, adjusted earnings per share from continued operations reached € 0.99 and were thus about 13 % above previous year’s figure of € 0.88.
Outlook for 2013 confirmed
In the financial year 2013, revenues of the K+S Group should increase slightly against the previous year. While a price-related revenue decrease can be assumed for the Potash and Magnesium Products business unit, higher revenues are expected in the Salt business unit as a result of volume factors. As far as the operating earnings EBIT I of the K+S Group are concerned, from today’s perspective, there is an opportunity to slightly increase the figure for the year 2013 compared with the year 2012. In this context, the anticipated drop in earnings in the Potash and Magnesium Products business unit should be more than made up for by the earnings improvement in the Salt business unit resulting from the normalisation of the de-icing salt business.
(Further details concerning the outlook can be found on page 20 of the Q1/13 Quarterly Financial Report.)
