Shares in K+S fall
Published by Nicholas Woodroof,
K+S said late on Thursday that it now expects EBITDA for the year ending 31 December to be between €660 million and €740 million (US$854 million). The company is due to report detailed 2Q18 results today.
“This range misses the current market expectations,” the company said in a brief statement after the market closed on Thursday, adding it would still significantly beat last year’s EBITDA of €577 million.
Analysts had forecast a full-year EBITDA of €797 million, K+S said, citing a consensus forecast published by Vara Research. The German company did not say why earnings would miss the forecast.
However, K+S warned in June that a stoppage at its new Bethune mine in Canada would weigh on its 2Q18 earnings and noted some quality issues with the potash during the ramp-up of production.
“The newly opened Bethune mine in Canada seems not to have ramped up as quickly as the market had expected due to the ongoing product quality issues,” JP Morgan analysts said in a note.
The company has also faced problems at its Werra site in Germany where waste water issues have led to production stoppages in recent years. K+S had previously projected a “significant increase” in EBITDA this year but never gave a specific target.
Shares in K+S were trading down 10.1% at €20.33 by 0734 GMT, having dropped as much as 11% at the open.
Separately, K+S said EBITDA rose to €105.1 million in 2Q18 from €101.9 million a year ago, adding it continues to target positive cash flow in 2019.
Canadian rival Nutrien Ltd this month reported a better-than-expected quarterly profit, driven by higher prices for potash and nitrogen fertilizers and raised its forecast for potash sales volumes.
Read the article online at: https://www.worldfertilizer.com/potash/14082018/shares-in-ks-fall/
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