Fertiglobe’s profit jumps 75% to $1.3b

Fertiglobe, the largest nitrogen fertilizer producer in the Middle East and North Africa, announced on Tuesday a 75 per cent year-on-year jump in “adjusted net profit” to $1.3 billion in 2022.

The Abu Dhabi-based company, a joint venture of Adnoc and OCI, the world’s largest seaborne exporter of urea and ammonia combined, said its full year 2022 revenue increased 52 per cent to $5 billion compared to 2021, while adjusted Ebitda was up 59 per cent to $2.5 billion.

Fertiglobe also announced second-half 2022 dividends of $700 million, bringing total dividends for the full year to $1.45 billion.

The company, an early mover in clean ammonia, said its Q4 2022 revenues declined 11 per cent YoY to $1.1 billion, while adjusted Ebitda fell 27 per cent to $472 million, driven by lower urea prices and plant turnarounds in the UAE and Egypt during the quarter.

Ahmed El Hoshy, chief executive officer of Fertiglobe, said the company has safely completed several turnarounds across its plants in the UAE and Egypt, and do not have further turnarounds planned in 2023.

“We have a good order book going into the first quarter of 2023, and our disciplined commercial strategy and distribution capabilities allow us to manage inventories close to main demand centres, placing us well to serve key import markets,” he said.

Fertiglobe began commissioning of the first phase of Egypt Green Hydrogen, and has signed the engineering procurement and construction contract with Tecnimont for the one million tonne low-carbon ammonia project in the UAE. Once at full scale, the project will deliver up to 15,000 tonnes of green hydrogen as feedstock for production of up to 90,000 tonnes of green ammonia.

The project will be financed by a mix of debt and equity. “As we progress tangible initiatives ahead of COP28 in the UAE, these projects allow us to demonstrate our commitment to taking concrete actions to meet the increasing demand for large-scale low-carbon hydrogen and ammonia and reduce the carbon footprint of both our operations and of hard-to-abate sectors in our value chain,” said El Hoshy

“While the last few months have seen weaker nitrogen pricing globally, market fundamentals continue to remain healthy in the medium to longer term, underpinned by tight supply, healthy farm economics and decades-low grain stocks globally, with another boost to affordability from the lower nitrogen prices. This gives strong incentives to apply nitrogen fertilizers. Moreover, there is no new greenfield urea supply starting up in 2023, and after that we see very few new additions until at least 2026,” said El Hoshy.

The company expects demand upside for its industrial business, supportive of ammonia primarily, driven by a recovery in China, lower energy prices supporting global industrial demand, and an improving outlook for global growth, he said.

— issacjohn@khaleejtimes.com

• Business