Acron Group’s Q3 2020 EBITDA Up 4%
Today,
Key Financials
- Q3 2020 revenue was RUB 29,656 million (USD 403 million), up 2% year-on-year (Q3 2019: RUB 29,143 million, or USD 452 million).
- Q3 2020 EBITDA* was RUB 8,808 million (USD 120 million), up 4% year-on-year (Q3 2019: RUB 8,468 million, or USD 131 million).
- Q3 2020 EBITDA margin reached 30%, up from 29% in Q3 2019.
- Q3 2020 net loss was RUB 3,175 million (USD 44 million) (Q3 2019: profit of RUB 5,792 million, or USD 90 million).
- At the end of Q3 2020, net debt in US dollar equivalent stood at USD 1,427 million, up 10% from USD 1,300 million at the end of Q2.
- Net debt/LTM EBITDA** in US dollar equivalent was 3.2 at the end of Q3, up from 2.9 at the end of Q2.
Operating Results
- In Q3 2020, commercial output of key products was 2.036 million tonnes, up 2% year-on-year. In 9M 2020, it was 5.957 million tonnes, up 3% year-on-year.
- In Q3 2020, sales of key products totalled 1.925 million tonnes, down 2% year-on-year. In 9M 2020, it was 5.784 million tonnes, almost unchanged year-on-year.
‘In 2020, Acron Group’s financials have grown incrementally. The third quarter saw the highest EBITDA in US dollar equivalent since Q4 2019. Rouble-denominated EBITDA was up year-on-year. Net profit decreased due to a foreign exchange loss, but this is non-cash and, therefore, not representative. Our financials improved over recent quarters due to recovering prices for mineral fertilisers, and a weaker rouble. We expect these factors to continue to support our financial performance in the coming periods.
‘In Q3, the Group’s debt burden increased due to distribution of annual dividends and higher working capital. We believe we have passed our debt peak and expect it to decrease in the coming quarters.
‘In November, we upgraded the Ammonia-4 unit and expanded its capacity by 70,000 tpa. Another major current project is Urea 6+, where we are increasing the unit’s capacity by 520,000 tpa. Until the debt burden normalises, we will keep CAPEX at a lower level compared with previous periods’.
APPENDIX
Notes on Key Items in the Financial Statements
Financial Performance
In Q3 2020, Acron Group’s revenue was up 2% to RUB 29,656 million year-on-year due to a 14% increase in the average USD-RUB exchange rate. Global US dollar-denominated prices for the Group’s key products decreased significantly (see the table below). Sales of the Group’s key products were down 2%. In 9M 2020, revenue was RUB 86,088 million, down 4% year-on-year.
In Q3, the cost of sales was down 5% year-on-year to RUB 15,081 million, mainly due to effective cost controls.
Third quarter selling, general, and administrative expenses were RUB 2,011 million, almost unchanged year-on-year.
Transportation expenses were up 22% in Q3 to RUB 6,477 million year-on-year, mainly due to higher logistics costs abroad resulting from a weaker rouble, and higher US dollar-denominated costs of container shipments to
Third quarter EBITDA was up 4% year-on-year to RUB 8,808 million. EBITDA margin was 30% in the same period, up from 29% in Q3 2019. In 9M 2020, EBITDA was down 18% year-on-year to RUB 24,116 million.
In Q3 2020,
Market Trends
In Q3 2020, global urea prices recovered after a seasonal setback in Q2, driven by strong demand from
The third quarter saw AN prices recover after a Q2 seasonal setback, and they have remained high in Q4 as seasonal demand for AN picks up in the Russian market and urea prices recover. In Q3, UAN prices were in a downward spiral due to low seasonal demand in
Although Q3 NPK prices declined slightly, the premium to the basic product basket remained relatively high at approximately 20%. In Q4, NPK prices have begun to recover due to higher prices for urea and DAP.
Average Indicative Prices,
USD/t | Q3 2020 | Q2 2020 | Q3 2019 | Q3 2020 / Q2 2020 change | Q3 2020 / Q3 2019 change |
NPK 16-16-16 | 253 | 258 | 295 | -2.3% | -14.4% |
AN | 162 | 153 | 196 | +6.0% | -17.4% |
UAN | 114 | 144 | 142 | -20.8% | -19.4% |
Urea | 231 | 207 | 247 | +11.6% | -6.6% |
Ammonia | 186 | 197 | 216 | -5.2% | -13.6% |
The full version of Acron Group’s financial statements is available at www.acron.ru/en
Note: The exchange rate used for currency conversion was RUB 79.6845 to USD 1 as of
* EBITDA is calculated as operating profit adjusted for depreciation and amortisation, foreign exchange gain or loss on operating transactions, and other non-cash and extraordinary items.
** LTM EBITDA is EBITDA calculated for the past 12 months.
Media contacts:
Public Relations
Phone: +7 (495) 777-08-65 (ext. 5196)
Investor contacts:
Investor Relations
Phone: +7 (495) 745-77-45 (ext. 5252)
Background Information
In 2019, the Group sold 7.6 million tonnes of main products to 78 countries, with
In 2019, the Group posted consolidated IFRS revenue of
For more information about
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