Fertiglobe’s third-quarter profit surges on higher demand for its products

Fertiglobe, the world’s largest seaborne exporter of urea and ammonia, reported a surge in third-quarter profit as revenue jumped on the back of higher demand for its products.

Net profit attributable to owners of the company for the three-month period to the end of September was $137.7 million from $6.2mn in the year-earlier period, the company said in a statement to the Abu Dhabi Securities Exchange, where its shares are traded.

Revenue during the period more than doubled to $866.7m.

“Fertiglobe’s earnings momentum during the third quarter and positive outlook are underpinned by a strong market environment for ammonia and urea,” the company said.

“Demand is robust in Fertiglobe’s key import markets, with the US, Europe, Latin America and India competing for [the] product ahead of the spring season in the second quarter of 2022.”

Fertiglobe, a joint venture between Adnoc and Netherlands-listed OCI, raised about $795m in its initial public offering last month, amid strong demand from international, regional and local investors.

The company – which is also the Mena region’s largest producer of nitrogen fertilisers by production capacity – sold more than 1.145 billion shares representing 13.8 per cent of its share capital.

The listing is the third-largest on the Abu Dhabi Securities Exchange.

Fertiglobe's “strong earnings momentum", is set to continue, said chief executive Ahmed El-Hoshy.

That will be "driven by increasing ammonia and urea prices, exemplifying the structural shift to a demand-driven market environment for nitrogen products over the medium term”, he said.

“Furthermore, as an early mover in clean ammonia projects, Fertiglobe is uniquely positioned to capitalise on the new demand for low or no carbon ammonia as an efficient energy carrier and clean fuel as part of the energy transition.”

The company made good progress in the last few months “by partnering with Adnoc to sell blue ammonia to Japan and reached a milestone through our partnership with Scatec and the Sovereign Fund of Egypt on a new project that could produce up to 90,000 metric tonnes of green ammonia in Egypt".

Fertiglobe has increased its dividend guidance to at least $240m for the second half of 2021, up from $200m. The dividend will be payable in April 2022, with the final number to be determined in February 2022, it said on Monday.

The company operates four plants in Egypt, Algeria and the UAE, and employs more than 2,600 people.

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