Grupa Azoty SA reported a more than tripling in net profit to Pln799.6 million (approximately $164.6 million at current exchange rates) on consolidated revenue of Pln6.41 billion for the second quarter ended June 30, 2022.
EBITDA increased by 243% to Pln1.24 billion. Consolidated revenue was up by 100% year-over-year.
The group said the second-quarter results were strongly impacted by the turmoil caused by Russia’s invasion of Ukraine, which adversely affected the availability and prices of feedstocks, pushing up prices of final products across all segments.
Azoty said as a result of lower exports, the volumes of fertilizers supplied by the group to the domestic market were “significantly larger” compared with the same period last year.
For the first half of 2022, the group posted a net profit of Pln1.68 billion on consolidated revenue of Pln13.24 billion, versus the year-earlier Pln253.7 million and Pln6.53 billion, respectively. Six-month EBITDA increased to Pln2.58 billion.
Commenting on the half-year results, Azoty said the results were bolstered by product prices prevailing in the European markets where the group operates, but were adversely affected by record prices of feedstocks used in production processes and lower sales volumes of most fertilizer, chemical, and plastic product categories.
Azoty said it was operating at full available capacity in the first half of the year, “actively responding to fertilizer demand in the domestic market at the peak of the spring fertilizer season.”
But it said in the third quarter, record natural gas prices drove fertilizer prices to levels that became “unacceptable” to end customers, and led the group to the decision to reduce production at three group companies.
Azoty’s Fertilizers/Agro business posted a 336% year-over-year increase in second-quarter EBITDA toPln657.3 million.
The group cited high prices of fertilizer feedstocks, particularly natural gas, potassium chloride, and phosphate rock, continued into the reporting quarter.
Azoty reported that Fertilizers/Agro’s sales volumes in the second quarter fell 11% year on year, with a decline of 21% reported for compound fertilizers volumes.