Israel Chemicals Ltd. (ICL) reported increased revenues and net profits in 2010. Sales rose by 25 percent to $5.692 billion, compared to $4.554 billion in 2009. Net profits were up by 33 percent, to $1.073 billion from $809 million in the previous year.
In the fourth quarter, ICL sales reached $1.421 billion, compared to $1.227 billion in the corresponding quarter a year earlier. Net profits totaled $293 million, versus $213 million in the fourth quarter of 2009. The company noted that increased quantities of potash, fertilizers, and other products compensated for lower potash prices and the weak dollar during the final quarter of the year.
ICL said that it was the second-best year on record and the best fourth quarter ever. It noted that sales to Asia primarily to China and India rose last year by 46 percent, to $1.680 billion.
ICL Fertilizers, the company’s largest division, accounted for $3.1 billion, or 51.7 percent of total revenues in 2010, up from 45 percent in the 2009. The increase was due to a sharp rise in the quantities of potash, phosphate fertilizers, and phosphate rock, which compensated for lower potash prices. Potash accounted for 66 percent of revenues. Potash revenues in 2010 totaled $2.141 billion, compared to $1.429 billion in 2009 and $2.7 billion in 2008. Fertilizer and rock sales totaled $1.056 billion, compared to $787.7 million in 2009 and $1.681 billion in 2008.
ICL Fertilizers sales to Asia rose by 46 percent to $1.102 billion, and to Latin American by 17 percent to $517 million. Asia (primarily India and China) accounted for 38 percent of total sales of ICL Fertilizers, with Europe 31 percent and South America 18 percent.
Potash production in 2010 totaled 4.251 million mt, compared to 4.109 million mt in 2009. Sales were 5.558 million mt, versus 2.709 million mt in 2009. Inventory dropped sharply, from 2.917 million mt in 2009 to 1.610 million mt in 2010. ICL said that the strike at Dead Sea Works in the first quarter of 2011 led to 450,000 mt of lost production at Sdom, but that the high level of inventories would enable the company to meet all commitments.
ICL said it is currently in the process of expanding the capacity of its Sdom operations by 500,000 mt/y. The additional capacity is due to come online by the end of 2014. This will raise total potash capacity to 6.5 million mt at its facilities in Israel, Spain, and England. ICL is also considering shutting down one of its two production facilities in Spain, and offsetting this by increasing production at the remaining facility.
ICL Fertilizers reported that it produced 3.135 million mt of phosphate rock in 2010, compared to 2.697 million in the previous year. Rock sales rose marginally, to 636,000 mt compared to 610,000 mt the previous year. Fertilizer production rose to 1.688 million mt, compared to 917,000 mt the year before. Fertilizer sales were up sharply, to 1.735 million mt from 1.061 million in 2009.
Meanwhile, Knesset Member Sheli Yechimovitz of Labor sharply criticized ICL for what she termed the outrageous salaries paid to its top officials. In its annual report ICL said that CEO Akiva Mozes received $5 million in compensation in 2010. Yechimovitz said that the salaries paid to the top management were indecent in light of the pressure put to bear on the Knesset Finance Committee last year to grant the company huge corporate tax breaks, arguing that at regular rates the company and its work force would be hurt. She added that ICL cannot pay its top management such huge salaries and at the same time pay such low royalties on natural resources that belong to the citizens of Israel.