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OCI reports 1Q20 results

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World Fertilizer,

OCI N.V. has released its 1Q20 results.


  • Revenues increased 36% to US$811 million and adjusted EBITDA 49% to US$193 million in 1Q20 vs 1Q19.
  • OCI-produced volumes sold increased 62% to 2.7 million t in 1Q20 compared to 1Q19.
  • Adjusted net loss of US$82 million in 1Q20 in line with a loss of US$82 million in 1Q19.
  • Net debt US$3.97 billion as of 31 March 2020, a reduction of US$94 million compared to 31 December 2019.
  • Covid-19 has not caused disruption to production and distribution to date, all OCI’s products deemed essential.
  • On track to deliver a healthy increase in volumes in 2020, in addition to the full consolidation of Fertiglobe.
  • In order to maximise value for stakeholders and in light of Covid-19 uncertainty, OCI postpones methanol process.



  • Internal COVID-19 taskforce established to ensure safety of our employees and business continuity.
  • Production at OCI’s facilities has not been disrupted by the Covid-19 challenges.
  • All OCI’s products deemed as essential to ensure uninterrupted supply of food and other essential products.
  • Supply chains and distribution channels continue to perform resiliently.


  • The current application season is progressing well, and the company's order book is healthy.
  • Expect strong demand for nitrogen fertilizer in core markets this season amidst favourable weather conditions, including:
  • - Direct application ammonia has been strong in the US this spring, which should minimise end-of-season inventory levels.
    - In the company's core US Midwest markets, the urea and UAN application season is expected to be robust, driven by a return to normal corn planting conditions and a forecast increase in planted acreage.
    - The European application season is currently ongoing with healthy nitrate demand developing in our core northern European markets.
    - Demand in several importing countries is healthy, including India, East Africa and Australia.
  • Impact of Covid-19 on nitrogen demand and supply:
  • - In the short term, the company expects some weakness in industrial nitrogen end markets as a result of GDP/industrial activity slowdown.
    - There is currently uncertainty regarding the outlook for ethanol demand, but whether this will ultimately result in reduced corn demand in 2021 will depend on a number of factors such as government incentives to farmers and a recovery in transport demand.
    - Several production curtailments and shutdowns have been announced, e.g. ammonia in Trinidad and short-term curtailment of urea production in India, and it is likely that there will be delays in completion of new projects as construction, delivery of equipment and commissioning is more difficult, resulting in less supply in short- and medium term.


  • A portion of global methanol demand is oil-related; methanol prices are down as a result of Covid-19 and drop in oil prices.
  • In the short term, global demand for methanol could be affected as a result of economic slowdown:
  • - However, likely curtailments of high cost methanol production and postponements of key projects already announced by other producers are mitigating factors that support supply / demand balance.
  • OCI is one of the lowest cost producers globally, and expected to benefit from the ramp-up of methanol capacity as well as the normalisation of production and improved onstream efficiency in 2020 compared to low asset utilisation rates in 2019.

Gas markets

    The company expects to continue to be a beneficiary of a low gas price environment for the remainder of 2020:

  • At TTF gas forward prices (c.US$2.73/MMBtu as of 1 May 2020) for the balance of the year, OCI’s gas input costs in the Netherlands would be c.US$100 million lower in 2020 on an annual basis compared to 2019, all else equal.
  • In the US, natural gas benchmark prices have remained at globally competitive prices below US$2/MMBtu, and current natural gas futures indicate that prices are expected to stay below US$3/MMBtu through 2024.

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