By Kjetil Malkenes Hovland
OSLO--Norwegian fertilizer producer Yara ASA (YAR.OS) said
Wednesday it is to invest 2.25 billion Norwegian kroner ($342.8
million) to boost production capacity at a plant in Norway as it
reported a rise in net profit of 9% on the year.
The company said it would boost the annual production capacity
at its Porsgrunn plant by 50,000 metric tons of NPK and 200,000
tons of calcium nitrate. Calcium nitrate and NPK fertilizers, based
on nitrogen, phosphorus and potassium, are important parts of
Yara's value-added product portfolio.
The investment also entailed a further 150,000 tons of annual
NPK production capacity at the company's sites in Glomfjord, Norway
and Uusikaupunki in Finland by optimizing production, Yara
said.
"This investment confirms Yara's ambition to create value
through brownfield expansions" and removing debottlenecks in
production, acting Chief Executive Torgeir Kvidal said.
Yara's third-quarter net profit was NOK1.71 billion, compared
with a net profit of NOK1.57 billion in the same period a year
earlier. The average forecast in a Reuters poll of 19 analysts was
NOK2.24 billion.
"Yara reports a strong third-quarter result with record
deliveries, reflecting both organic growth and the Bunge
acquisition in Brazil," said Mr. Kvidal, who replaced Jorgen Ole
Haslestad this month.
Third-quarter revenue were NOK24.10 billion, up from NOK20.61
billion a year earlier and compared with expectations of NOK21.67
billion. Earnings before interest and taxes totaled NOK2.76
billion, up from NOK2.39 billion but missing expectations of
NOK3.16 billion.
Yara's global fertilizer deliveries rose 16% on the year, mainly
driven by Brazil and the inclusion of volumes from Bunge as of
August last year.
Yara said it received on average 3% more on the year for its
urea and 3% less for its NPK fertilizer deliveries, while prices
for its nitrate output were flat in the third quarter.
Yara reported a NOK549 million foreign-exchange loss in the
quarter, from a NOK71 million loss a year earlier, as the dollar
appreciated significantly against almost all of Yara's main
currencies.
The company's oil and gas cost was 19% lower on the year,
especially due to significantly lower natural gas prices in
Europe.
Shares closed Tuesday at NOK309.90, valuing the company at
NOK85.6 billion.
Write to Kjetil Malkenes Hovland at kjetil.hovland@wsj.com
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