Leading Russian fertilizer producer PJSC Acron posted an increase in revenue in the fourth quarter of 2017 to US$429 million from US$356 million in 2016. EBITDA for the period climbed to US$140 million, up from US$119 million, the company said in its earnings report March 28.
Average global prices for ammonium nitrate in the quarter improved year over year to US$218/t from US$179/t. Prices of NPK fertilizers rose to US$271/t from US$254/t.
A lower average dollar to Russian ruble exchange rate weighed heavily on Acron's net profit in 2017, which dropped significantly year over year to US$244 million, from US$381 million in 2016.
The company said that while profit suffered due to the weaker exchange rate, revenue benefited from a more robust pricing environment.
Revenue grew 21% to US$1.62 billion as average indicative prices for nitrogen fertilizers were up between 5% and 16% year over year. Cost of sales climbed 15% to 51.91 billion rubles, "mainly affected by higher depreciation and amortization as a result of the Ammonia-4 launch in the mid-2016."
Acron's EBITDA grew 15% to US$511 million.
At the end of 2017, net debt was up 22% to US$1.05 billion.
Commenting on the market trends for 2018, Acron said it is likely that urea exports from China will decrease to 2 million tonnes and the country's higher costs will continue to support global prices during the high season.
"According to our evaluation, in early 2018 the cash cost for most Chinese producers increased to USD 305 (FOB), causing an increase in the FOB China price to USD 310," the company said.
As of March 27, US$1 was equivalent to 57.38 Russian rubles.