The key subsidiaries of Evrokhim, Russia’s largest nitrogen mineral fertilizer producer, have been ramping up output owing to favorable conditions in the industry. Thus, Novomoskovsky Azot raised its output of mineral fertilizers to 544,200 tons in 9M05 (restated as 100% nutritional content), up 20.4% y-o-y. Nevinnomyssky Azot, in turn, produced 682,000 tons of mineral fertilizer in 9M05 (restated as 100% nutritional content), which is 9.7% more than the same period in 2004.
In addition, based on 9M05 RAS financial reports, both companies showed impressive financial results. Sales revenue at Novomoskovsky Azot rose 39.5% during the reporting period and amounted to $340.9 mln, while Nevinnomyssky Azot boosted its revenue to $331.2 mln, up 63.1% on the year-earlier period. The faster pace of growth displayed by Nevinnomyssky Azot is attributable to a higher proportion of exportable goods. Evrokhim’s companies also considerably improved their profit margins.
We are upbeat on the outlook for Russia’s nitrogen fertilizer producers, especially in light of expectations that domestic gas prices will not be hiked, which would allow domestic nitrogen fertilizer producers to retain their competitive edge on the global market and keep their privileged status as highly profitable exporters. Among Evrokhim’s various subsidiaries, we would like to draw investors’ attention especially to the shares of the promising and dynamically expanding Novomoskovsky Azot.
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