PhosAgro sales show great results

PhosAgro has published its 1Q 2020 financial results. The company’s revenue has decreased by 11.4% to 64,058 billion rubles. However, it’s free cash flow has remained almost unchanged and amounting to 18,253 billion rubles.

The volume of sales of mineral fertilizers in January-March this year has increased by 9.6% to 2.790 million tons, including phosphorus by 8.2% to 2.087 million tons and nitrogen by 13.9% to 703 thousand tons.

“Speaking about the company’s financial results, I would like to note that in the first quarter this year, the situation on world markets was favorable for fertilizer producers. Seasonal demand contributed to the rise in fertilizer prices from the minimum levels at the end of 2019. It allowed us to increase sales volumes in key areas, bringing the share of Russian priority market almost to 40% in the company’s total revenue,” said PhosAgro CEO Andrey Guryev.

“Gain in sales volumes against the price recovery provided an increase in EBITDA of more than 1.5 times compared to the previous quarter. Optimization of circulating capital by reducing the volume of finished goods inventory made it possible to obtain free cash flow of more than 18 billion rubles,” he added.

Strong growth in financial indicators allowed the company to continue implementing the investment program without attracting additional external financing. The level of investments was fully consistent with the annual plan and did not exceed 50% of EBITDA for the quarter.