SBU Azot Announces 3M 2012 Commercial and Operational Results

  • Ammonium nitrate domestic sales increased by 10%
  • Caprolactam and ammonia exports grew by 12% and 15%, respectively
  • The Company’s 3M revenue totaled 7.9 billion roubles
  • EBITDA margin amounted to 33%

In the first three months of the year SBU Azot delivered domestically and internationally 36,300 tonnes of commercial ammonia, 523,000 tonnes of nitrogen products and 30,800 tonnes of caprolactam.

Domestic market. The amount of nitrogen products delivered to the domestic market increased by 10% year-on-year, exceeding 279,000 tonnes. SBU Azot delivered domestically 16,500 tonnes of ammonia, 259,000 tonnes of ammonium nitrate, 19,700 tonnes of urea and 500 tonnes of ammonium sulphate. SBU Azot is one of the key suppliers of ammonium nitrate within Russia, accounting for over 20% of the product sold nationwide and up to 50% in the industrial segment.

International market. In January – March, 2012, the Company’s caprolactam and ammonia exports grew by 12% and 15%, respectively. SBU Azot delivered internationally 244,000 tonnes of nitrogen products. This included 111,000 tonnes of urea, 48,000 tonnes of AN and 84,500 tonnes of ammonium sulphate exported over the period. International sales of ammonium nitrate decreased by 39% year-on-year due to larger sales to the domestic market, which offers the Company a substantial premium. SBU Azot is a leading Russian supplier of caprolactam to the global market, accounting for 59% of overseas sales.

Financial results. As per the management accounts, the Company’s 3-month consolidated revenue totaled 7.9 billion roubles. EBITDA reached 2.6 billion roubles. EBITDA margin amounted to 33%. Given the current market situation the company’s EBITDA may exceed 9 billion roubles in 2012.

Production in January-March, 2012 (‘000 tonnes)

  3M 2012 3M 2011 YOY Change
ammonia 284 275 3,3%
Nitrogen products, including 535 536  
ammonium nitrate 319 307 4%
urea 132 148 -11%
ammonium sulphate 84 80 5%
caprolactam 29,3 28,8 2%

A slight decrease in urea production resulted from the overhaul of the equipment held in accordance with the repair cycle schedule.

Company profile
SBU Azot is one of the largest Russian nitrogen fertiliser producers. The Company’s enterprises produce nitrogen products for industrial and agricultural customers, and petrochemicals (caprolactam). The Company sells its products in over 40 countries worldwide.

Domestically and in the CIS, industrial grade ammonium nitrate is the Company’s key product. SBU Azot markets the product mainly to customers in Russia’s Siberia and the Far East, as well as in Mongolia and Kazakhstan, regions which offer good market capacity and demand perspective in the AN products for civil explosives segment.

In 2011, the Company’s plants produced more than 1 million tonnes of ammonia, 2 million tonnes of nitrogen products and over 112,000 tonnes of caprolactam. Revenues consolidated in accordance with the International Financial Reporting Standards (IFRS) exceeded 30.9 billion roubles, EBITDA amounted 8.7 billion roubles, EBITDA margin totaled 28%, in 2011.