K+S Group increases revenues in the first half of 2013

Transcription

1 Kassel, 13 August 2013 K+S Group increases revenues in the first half of 2013 Good sales volumes for potash and magnesium products Salt business significantly above last year Revenues of the first half year increase by 4% to 2,154.8 million Operating earnings EBIT I at million (H1/12: million) Adjusted earnings per share from continued operations reach 1.55 (H1/12: 1.61) Legacy Project advanced according to plan Outlook: As announced on 6 August, K+S, in the light of recent developments on the potash market and following the principle of prudence, will no longer maintain its forecast for The K+S Group increased its revenues for the first six months of financial year 2013 by 4% to about 2.15 billion. The first half of the year was successful for us overall, says Norbert Steiner, chairman of the Board of Executive Directors of K+S Aktiengesellschaft. That s true for both pillars of our business for our fertilizers as well as for our salt business. The revenue growth posted by the K+S Group for the first half of the year was based on high sales volumes in both the Potash and Magnesium Products and Salt business units in the first quarter of At million, second quarter revenues were down 12% on the robust figure of a year ago.

2 Page 2 of press release K+S Group increases revenues in the first half of 2013, 13 August 2013 In the first six months, the revenues generated by the Potash and Magnesium Products business unit reached 1.17 billion (-6%). Compared with the exceptionally high sales volumes for the same quarter a year ago, sales volumes for the Potash and Magnesium Products business unit normalised in the second quarter of 2013, with prices significantly lower than a year ago. The revenues generated by fertilizer specialities increased from April to June 2013 as a result of volume factors. In the Salt business unit, revenues for the first half of the year increased significantly, rising by 21% to million. In the second quarter, the business unit achieved revenues on about the same level as a year ago, because a partially higher price level could almost offset negative currency effects. First half-year operating earnings EBIT I at million For the first six months of 2013, the K+S Group achieved operating earnings of million. This represented a decrease of about 6% on the figure of a year ago. In the second quarter of 2013, at million, operating earnings EBIT I were down 56.1 million or 26% on the high figure for the previous year s quarter. In the Potash and Magnesium Products business unit, lower prices as well as lower sales volumes resulted in declining earnings compared with the robust quarter of a year ago. The earnings decrease in the Salt business unit was particularly attributable to an expense connected with the planned sale of a transport and supply ship in the amount of 3.2 million as well as to catch-up effects related to maintenance activities. At 64.4 million, the K+S Group s depreciation and amortisation for the second quarter taken into account in EBIT I were up on the figure for the same period a year ago (Q2/12: 56.0 million) as a result of higher capital expenditure for the package of measures for water protection. Adjusted Group earnings from continued operations down slightly on a year ago Adjusted Group earnings from continued operations for the first half of 2013 fell by 4% or 12.7 million to million. This key figure fell by 25% or

3 Page 3 of press release K+S Group increases revenues in the first half of 2013, 13 August million to million in the second quarter (Q2/12: million). Adjusted earnings per share from continued operations for the first half of the year reached 1.55 (H1/12: 1.61), with the second quarter accounting for 0.56, compared with 0.73 in the previous year s period. Capital expenditure K+S Group capital expenditure for the first six months totalled million. In the second quarter, capital expenditure came to million and was therefore more than twice as high as in the same quarter a year ago (Q2/12: 77.7 million). The majority of the capital expenditure was accounted for by the Potash and Magnesium Products business unit. In this business unit, the increase is mainly attributable to the capital expenditure related to the package of measures for water protection in the Hesse- Thuringia potash district and to the construction of the potash plant in Canada (Legacy Project), mainly for infrastructure, water supply, drilling and engineering works in the latter case. The Legacy Project proceeded as scheduled. Outlook 2013 As a result of the announcement made by Russian Uralkali that it would exit the BPC sales organisation operated jointly with Belarusian Belaruskali and related statements on the part of Uralkali concerning the expansion of output, significant uncertainty about the future volume- and price development in the market for potash fertilizer has occurred. Against this backdrop, K+S announced on 6 August 2013 that, following the principle of prudence, it will no longer adhere to its forecast for 2013 to slightly increase the operating earnings EBIT I compared to 2012 ( million). It is probable that the expected increase in earnings of the Salt business unit will not be sufficient to compensate for the decrease in earnings of the Potashand Magnesium Products business unit. K+S will continuously monitor the competitive environment include findings into business policies and prepare for potential changes.

4 Page 4 of press release K+S Group increases revenues in the first half of 2013, 13 August 2013 Experience growth K+S is one of the world's leading suppliers of standard and speciality fertilizers. In the salt business, K+S is the world s leading producer, with sites in Europe as well as North and South America. K+S offers a comprehensive range of goods and services for agriculture, industry, and private consumers, which provides growth opportunities in virtually every sphere of daily life. The K+S Group employs more than 14,000 people worldwide. The K+S share the commodities stock on the German DAX index is listed on all German stock exchanges (ISIN: DE000KSAG888, symbol: SDF). More information about K+S can be found at Note to editors The half-yearly financial report (H1/2013), a video webcast by Norbert Steiner, chairman of the Board of Executive Directors of K+S Aktiengesellschaft, and up-to-date press photos relating to the K+S Group are available under We are offering a conference call for analysts in English today at 3 p.m. Norbert Steiner, chairman of the Board of Executive Directors, and Dr. Burkhard Lohr, member of the Board of Executive Directors, will participate in the conference call. Shareholders, investors, representatives of the press and all other interested parties are invited to follow the conference via a live webcast at ( or by phone on The conference is being recorded and will then also be available as a podcast.

5 Page 5 of press release K+S Group increases revenues in the first half of 2013, 13 August 2013 Your contact persons: Press: Investor Relations Martin Bommersheim Thorsten Boeckers Phone: Phone: Fax: Fax: martin.bommersheim@k-plus-s.com thorsten.boeckers@k-plus-s.com Forward-looking statements This press release contains facts and forecasts that relate to the future development of the K+S Group and its companies. The forecasts are estimates that we have made on the basis of all the information available to us at this moment in time. Should the assumptions underlying these forecasts prove not to be correct or should certain risks - such as those referred to in the Risk Report - materialise, actual developments and events may deviate from current expectations. The Company assumes no obligation to update the statements contained in this press release, save for the making of such disclosures as are required by the provisions of statute.

6 Page 6 of press release K+S Group increases revenues in the first half of 2013, 13 August 2013 K+S Group Summary Q2 Q2 Q2/ ) April-June April-June Change All figures in accordance with IFRS million million in % Revenues (12.2) Potash and Magnesium Products (18.1) Salt (0.9) Complementary Activities Reconciliation (50.0) Earnings before interest, taxes, depreciation and amortisation (EBITDA) (17.4) Operating earnings (EBIT I) (25.7) Potash and Magnesium Products (24.2) Salt (13.5) (11.6) (16.4) Complementary Activities (6.1) Reconciliation (12.1) (16.3) Financial result (17.5) (24.1) Earnings before income taxes, adjusted 2) (25.4) Group earnings after taxes, adjusted 2), 3) (29.4) Group earnings from continued operations, adjusted 2) (24.6) Earnings per share, adjusted ( ) 2), 3) (28.2) Earnings per share from continued operations, adjusted ( ) 2) (23.3) Capital expenditure 4) >100 1) Unless stated otherwise, information refers to the continued operations of the K+S Group. The income statement and the cash flow statement were adjusted according to IFRS following the divestment of the nitrogen business. The balance sheet and therefore the key figures of working capital, net indebtedness and the book value per share as of 30 June 2012 were not adjusted and also include the discontinued operations of the nitrogen business. 2) The adjusted key figures only include the result from operating forecast hedges of the respective reporting period reported in EBIT I, which eliminates effects from changes in the market value of the hedges as well as effects from the exchange rate hedging of future capital expenditure in Canadian dollar (Legacy Project). Related effects on deferred and cash taxes are also eliminated; tax rate for Q2/13: 28.5% (Q2/12: 28.5%). 3) Earnings from continued and discontinued operations. 4) Capital expenditure in or depreciation on property, plant and equipment, intangible assets and investment properties as well as depreciation on financial assets.

7 Page 7 of press release K+S Group increases revenues in the first half of 2013, 13 August 2013 K+S Group Summary H1 H1 H1/ ) Jan.-June Jan.-June Change All figures in accordance with IFRS million million in % Revenues 2, , Potash and Magnesium Products 1, ,251.4 (6.2) Salt Complementary Activities Reconciliation (47.8) Earnings before interest, taxes, depreciation and amortisation (EBITDA) (2.5) Operating earnings (EBIT I) (5.6) Potash and Magnesium Products (12.6) Salt Complementary Activities (3.7) Reconciliation (23.3) (28.5) Financial result (35.4) (39.2) +9.7 Earnings before income taxes, adjusted 2) (5.2) Group earnings after taxes, adjusted 2), 3) (13.6) Group earnings from continued operations, adjusted 2) (4.1) Earnings per share, adjusted ( ) 2), 3) (13.4) Earnings per share from continued operations, adjusted ( ) 2) (3.7) Capital expenditure 4) >100 Employees as of 30 June (number) 14,255 14,325 (0.5) of which trainees (number) (0.4) 1) Unless stated otherwise, information refers to the continued operations of the K+S Group. The income statement and the cash flow statement were adjusted according to IFRS following the divestment of the nitrogen business. The balance sheet and therefore the key figures of working capital, net indebtedness and the book value per share as of 30 June 2012 were not adjusted and also include the discontinued operations of the nitrogen business. 2) The adjusted key figures only include the result from operating forecast hedges of the respective reporting period reported in EBIT I, which eliminates effects from changes in the market value of the hedges as well as effects from the exchange rate hedging of future capital expenditure in Canadian dollar (Legacy Project). Related effects on deferred and cash taxes are also eliminated; tax rate for Q2/13: 28.5% (Q2/12: 28.5%). 3) Earnings from continued and discontinued operations. 4) Capital expenditure in or depreciation on property, plant and equipment, intangible assets and investment properties as well as depreciation on financial assets..