By Kjetil Malkenes Hovland
OSLO--Norway's Yara International ASA (YAR.OS) Wednesday beat
expectations but still reported a fall in first-quarter profits due
to lower prices.
Announcing the results, the company said fertilizer deliveries
were at record levels, partly due to an early spring in Europe.
Yara's first-quarter net profit was 1.77 billion Norwegian
kroner ($294.5 million), compared with a net profit of NOK2.26
billion in the same period a year earlier. The average forecast in
a FactSet poll of 17 analysts was NOK1.56 billion.
The company said it received on average 13% less on the year for
its urea, 12% less for its nitrate and 10% less for its NPK
fertilizer deliveries.
Yara's global fertilizer deliveries rose 21% on the year, mainly
due to healthy demand both in Europe and Latin America, while
commodity nitrogen markets were hit by higher Chinese supply.
"Yara reports a strong first-quarter result reflecting record
deliveries," said Yara Chief Executive Jørgen Ole Haslestad.
Food prices dropped in 2013, especially for grains, but
rebounded in the first quarter, according to the United Nations
Food and Agriculture Organization. The grain price increased amid
concerns about the 2014 to 2015 crop due to a cold winter and late
spring in the U.S., Yara said.
The company said production has restarted at the Lifeco plant in
Marsa el Brega, Libya, following a controlled shutdown in January
after a local militia blocked the site.
First-quarter revenue totaled NOK21.76 billion, from NOK20.62
billion a year earlier and slightly below the expected NOK22
billion. Earnings before interest and taxes totaled NOK2.57
billion, down from NOK3.29 billion a year earlier but beating
expectations of NOK2.02 billion.
The company expected second-quarter energy costs NOK600 million
lower than the year-earlier period, and third-quarter energy costs
NOK450 million lower than last year.
Shares closed Tuesday at NOK266.60, valuing the company at
NOK74.2 billion.
Write to Kjetil Malkenes Hovland at
kjetilmalkenes.hovland@wsj.com
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