Potash market’s recovery boosts Israel Chemicals’ revenue, profit
Israel Chemicals Ltd. (ICL) reported on Wednesday higher revenue and profit in the fourth quarter, beating expectations, as potash prices rose and expenses fell at the world’s sixth-largest producer of the fertilizer ingredient.
ICL, which also produces about a third of the world’s bromine, said it earned $142 million excluding one-time items in the fourth quarter, compared with $114m. a year earlier.
Analysts had forecast ICL to earn $100m., according to Thomson Reuters I/B/E/S.
Revenue grew 2% to $1.36 billion.
ICL said its asset sales in 2017 helped reduced debt, enhanced financial stability and generated resources for future growth.
“Looking forward, ICL will focus on its core business, aiming to further strengthen the competitiveness of its existing mineral assets while expanding our specialty business,” ICL chairman Johanan Locker said.
Amid healthy demand, ICL cited data showing potash prices in the quarter were around $280 per ton in Brazil, 19% above the fourth quarter of 2016.
In 2017, China imported 7.5 million tons of potash, up 10.5% from 2016.
Still, ICL’s potash production fell to 4.77 million tons in 2017 from 5.28 million tons in 2016, while potash sales dipped to 5.04 million tons from 5.17 million tons. ICL said the phosphate market had hit bottom in 2017 and prices had begun to rise, while global demand for magnesium remained constrained and prices were still under pressure in China, Brazil and Europe.
Nutrien Ltd. said this month its Potash Corporation of Saskatchewan unit had sold its 13.77% stake in ICL, removing a major overhang for ICL’s New York-listed shares, which fell 1.7% in 2017 and are 2% lower so far in 2018.
ICL, which has exclusive rights in Israel to mine minerals from the Dead Sea, said it would pay a fourth-quarter dividend of $70m., or 5.4 cents a share, up from $57m. in the third quarter.