Fertiglobe, based in Abu Dhabi, saw its revenue drop by 5.6% to $496 million in the third quarter
Fertiglobe, a fertilizer company based in Abu Dhabi, said on Monday that it made $495.6 million in revenue in the third quarter of 2024. This is a 5.6% decrease compared to the same time last year.
Fertiglobe’s earnings
- Fertiglobe, the largest exporter of urea and ammonia by sea in the world and the top nitrogen fertilizer producer in the Middle East and North Africa (MENA), reported a 12% drop in adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA). This fell to $176 million for the quarter, according to the company’s statement.
- The company, listed in Abu Dhabi, said its sales volume of products it made itself decreased by 7% from the same period last year, due to both planned and unplanned shutdowns.
- For the first nine months of the year, Fertiglobe’s sales volume of its own products dropped slightly by 2%, totaling 4.2 million tons.
- After accounting for special external events in 2024, the sales volume for the third quarter and the first nine months of 2024 would have increased by 2.1% and 5%, respectively.
- Fertiglobe, ranked 68th on Forbes Middle East’s list of Top 100 Listed Companies for 2024, reported a net debt of $957 million at the end of September 2024.
- Despite potential adjustments, Fertiglobe said its costs in Algeria remain competitive compared to other parts of the group and globally.
Important quote
“After ADNOC recently bought most of Fertiglobe, we are happy to announce that ADNOC will transfer its 35% share in the Baytown, Texas low-carbon ammonia project in the US, along with two similar projects in the UAE, to Fertiglobe. This will make us the world’s largest low-carbon ammonia producer by 2029,” said CEO Ahmed El-Hoshy.
“We are also proud to have achieved 92% of our $50 million cost-saving target by September 2024 and are on track to meet the full goal by the end of the year. In addition, our Manufacturing Improvement Plan (MIP) is progressing well and will help us generate $100 million more in annual profit by the end of 2025, compared to 2023, by improving production and energy efficiency,” he added.
New Projects
Two low-carbon ammonia projects are being developed in the UAE. The first is an existing project with a capacity of 1 million tons per year (mtpa), which is under construction. Fertiglobe will nearly double its ownership in this project. The second is a new 1 mtpa project, which is still in the early planning stage.
Also, ADNOC’s joint venture with ExxonMobil includes a 1 mtpa low-carbon hydrogen and ammonia project. ADNOC’s 35% share in this project will later be transferred to Fertiglobe once it is ready to start.
Together, these projects will increase Fertiglobe’s total ammonia capacity by 2.4 mtpa, more than doubling its current capacity of 1.6 mtpa. This will bring its total capacity to 9 mtpa for ammonia and urea combined.
Fertilizer Demand Outlook
The demand for nitrogen fertilizers looks good in the short term, as markets are tight and Chinese exports are at record lows, according to Fertiglobe. The long-term outlook also remains positive due to increasing demand for both new and existing uses, with limited supply from new projects.
In the third quarter, the availability of ammonia for export was reduced because of gas shortages in Egypt and Trinidad, as well as power outages in Algeria.
In the urea market, buying was slow at the beginning of the third quarter because of the summer holidays, bad weather in several markets, and lower crop prices. However, things started to improve in September 2024, as demand from India increased and overall supply remained tight, which helped support prices.
Published: 11th November 2024
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