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PhosAgro's Q4'18 profit up 6% YOY on higher prices, ruble depreciation

PJSC PhosAgro's net income in the fourth quarter of 2018 grew 6% year over year to 4.50 billion Russian rubles from 4.26 billion rubles in the year-ago period.

Revenue jumped 30% to 59.40 billion rubles, and EBITDA increased 51% to 18.56 billion rubles.

The improvement was attributed to higher prices and the depreciation of the ruble against the U.S. dollar, which had a positive impact as most of the company's products are dollar-based while costs are primarily ruble-based.

Fertilizer sales dropped 2% to 2 million tonnes due to bad weather from November to December 2018, which forced the company to postpone shipments and stockpile fertilizers at European ports. Cost of sales increased 18% to 29.5 billion rubles.

The company said March 20 that it redirected exports to Russia, the U.S. and Latin America to achieve the best netback prices.

For full year 2018, PhosAgro's net profit sank 13% to 22.14 billion rubles, revenue increased 29% to 233.43 billion rubles, EBITDA rose 47% to 74.91 billion rubles, and cost of sales climbed 22% to 123.96 billion rubles.

Fertilizer production in 2018 rose 8% to 9 million tonnes due to upgrades to its midstream capacity. The company expects a further 5% growth this year.

PhosAgro's board recommended a dividend of 6.6 billion rubles, or 51 rubles per share, to shareholders on record as of June 10. Shareholders will vote on the proposal during the company's annual general meeting May 24.

PhosAgro anticipates prices for phosphate-based fertilizers to be under pressure throughout the first quarter due to the slow recovery of seasonal demand in the U.S. Prices are expected to recover in the second quarter, driven by the beginning of the application season in major agricultural regions.

As of March 19, US$1 was equivalent to 64.41 Russian rubles.