Yara International ASA reported a 72 percent increase in net income after non-controlling interests for the first quarter ending March 31, 2010. Income moved up to NOK 1,522 million (US$257 million) (NOK 5.27 or $.89 per share), compared with the year-ago NOK 887 million (US$149.8 million) (NOK 3.06 or $.52 per share). Excluding net foreign exchange gains/losses and special items, the result was NOK 4.22 per share ($.71 per share) compared with NOK 2.81 per share ($.47 per share) in first-quarter 2009. First-quarter 2010 operating income was NOK 2,315 million (US$391 million) compared with NOK 1,194 million (US$201.5 million) in 2009. EBITDA was NOK 3,251 million (US$549 million) compared with 1Q 09’s NOK 2,036 million (US$344 million).
Total revenues and other income were NOK 15,638 million (US$2.64 billion) for the first quarter, down from the year-ago quarter’s NOK 17,118 million (US$2.89 billion). Fertilizer sales volumes moved up to 5.3 million mt from 4.9 million mt the previous year. Total sales volumes, including industrial, were 6.3 million mt, up from the year-ago 5.7 million mt.
“Yara reports strong first-quarter results. Fertilizer markets have improved substantially from the downturn witnessed in late 2008 and 2009. Yara has increased production to full capacity again in the first quarter, and prices have continued to increase. However, we are prepared for volatile markets going forward and can meet these with the flexibility and scale in Yara’s business model,” said Jørgen Ole Haslestad, Yara president and CEO.
“We did not succeed in acquiring Terra Industries at an attractive price for Yara, but our growth ambitions remain firm, with a scalable business model geared for profitable expansions. However, as demonstrated by our decision to not participate in a Terra bidding war, strict focus on financial discipline and attractive valuation remain at the core of Yara’s growth strategy,” he said.
Yara fertilizer deliveries were up 8 percent over first quarter last year. Yara said it continued to exercise tight inventory management, maintaining an already low stock level and ending 37 percent below first quarter 2009. First-quarter margins for the Industrial segment were second only to a year ago, when margins were boosted by contractual time lags. Fertilizer production increased to full capacity at the beginning of the first quarter as NPK demand picked up, following production curtailments since late 2008. First-quarter results include a US$123 million breakup fee paid to Yara after the termination of the merger agreement with Terra Industries, giving a NOK 666 million (US$112.4 million) profit before tax.
Yara said that going forward, the long-term fundamentals for fertilizer demand are strong as global grain consumption growth remains at an historic high.