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ICL Reports Solid Results & Strong Cash Flow for 2012 Despite Weak Global Economic Environment



  ICL Reports Solid Results & Strong Cash Flow for 2012 Despite Weak Global
                             Economic Environment

PR Newswire

TEL-AVIV, Israel, March 13, 2013

TEL-AVIV, Israel, March 13, 2013 /PRNewswire/ --

- Key 2012 Results: $1.3B Net Profit, $6.7B Sales -

- 2^nd-Best   Annual Cash Flow Ever of $1.6B, Up 26% Compared With 2011-

- ICL Fertilizers: As Expected, Low Q4 Potash Sales to China and India
Impacted Q4 & 2012 Revenues; Significant New Potash Supply Agreements Were
Signed During Q1 2013 -

  o ICL Industrial Products: 2^nd-Best-Ever Annual Operating Income Despite
    Slower Flame Retardant Sales Due to Weak Global Electronic Markets;
    Stronger Sales of Drilling Fluids & Other Brominated Products for the
    Energy and Water Markets -

  o ICL Performance Products: Year-Over-Year Increase in European Sales Led to
    Increased Sales in Q4;Trend Continuing into Q1 2013 -

ICL (TASE:ICL), a multinational fertilizer and specialty chemicals company,
today reported its financial results for the fourth quarter and full year
ended December 31, 2012.

Financial Results

Revenues: For the full year 2012, ICL's sales totaled $6,672.2 million, a 5.6%
decline compared with $7,067.8 million in 2011. The decrease derived from
reduced sales of the fourth quarter, countered partially by a rise in selling
prices and the consolidation of companies acquired in 2011-2012.

For the fourth quarter of 2012, sales totaled $1,338.1 million, a $374 million
decline compared with $1,712.4 million in the fourth quarter of 2011,
reflecting lower quantity sales, including primarily the low level of potash
shipments to India and China, and lower average prices. During the first
quarter of 2013, ICL Fertilizers signed a number of significant potash supply
agreements with customers in both India and China indicating strong volumes
for 2013(see "Outlook" section below).

Gross profit: Gross profit for the fourth quarter totaled $507.1 million
compared with $775.4 million in the fourth quarter of 2011. The decline
reflected lower selling prices for most of the Company's products coupled with
lower quantities sold and an increase in raw-material and energy prices. Gross
margin for the period was 37.9% compared with 45.3% for the fourth quarter of
2011.

For the full year, gross profit totaled $2,757.2 million compared with
$3,155.7 million in 2011. The decrease derived primarily from the lower
quantities sold together with a rise in raw material and energy costs, offset
partially by a decline in other operating expenses. Gross margin for the year
was 41.3% compared with 44.6% for 2011.

Operating income: Operating income for the fourth quarter of 2012 was $238.0
million, excluding one-time expenses (associated mainly with early retirement
plans), compared with $466.5 million for the parallel quarter of 2011. The
decrease derived from the reduction in the gross profit, partially offset by
lower operating expenses.

For the full year, operating income totaled $1,576.5 million compared with
$1,926.0 million in 2011. The decrease derived from the reduction in the gross
profit and the impact of one-time expenses, as explained above. Operating
margin for the year was 23.6% compared with 27.2% for 2011.

Net income: Net income to shareholders for the fourth quarter of 2012 totaled
$209.5 million compared with $369.6 million in the parallel period of 2011.
For the full year, net income to shareholders totaled $1,300.5 million
compared with $1,511.8 million in 2011.

Cash flow: During the fourth quarter of 2012, cash flow from current
operations totaled $275.0 million. For the full year, cash flow totaled
$1,592.7 million, a 25% increase compared with $1,269.4 million for 2011.

Outlook:

  o The high price of agricultural products, together with the past year's
    decline in fertilizer prices, has given farmers a strong incentive to
    increase fertilizer application.
  o The world economic environment is expected to continue impacting the sales
    of ICL Industrial Products and ICL Performance Products.  

Highlights of Core Business Segments

        ICL Fertilizers: The segment's sales for the fourth quarter of
2012 totaled $709.7 million, representing 53.0% of total revenues (before
offsets of inter-segment sales), a 31% decline compared with Q4 2011. This
decrease reflected the lack of significant potash sales to customers in China
and India. However, during the first quarter of 2013, the Company has signed
significant potash supply agreements with customers in both of these key
markets.

   For the full year, sales totaled $3.8 billion, representing 57.1% of total
revenues (before offsets of inter-segment sales), a 7% decrease compared with
2011. The decrease derived from the lower potash quantities sold together with
unfavorable exchange rate fluctuations.

ICL Fertilizers' operating income for the fourth quarter of 2012 totaled
$140.0 million, representing an operating margin of 19.7%. Excluding one-time
expenses associated with early retirement plans, the segment's operating
income totaled $173 million, representing an operating margin of 24.4%. For
the full year, operating income totaled $1,158.9 million, representing an
operating margin of 30.4%.

During 2012, ICL Fertilizers manufactured 4.94 million tons of potash, a 16%
increase compared with 4.26 million tons in 2011. This reflected the Company's
continued full-capacity operations in Israel despite the lower sales, which is
enabled by its strategic ability to store nearly unlimited quantities of
potash outdoors at its Sodom site. In addition, the increase reflected higher
production in Spain during the year. The strike in DSW in Israel in early 2011
reduced the quantities of potash manufactured during the comparative year.

2012 sales of phosphate fertilizers were slightly higher compared to their
level in 2011 reflecting the consolidation of companies acquired during 2011,
countered by lower quantities and prices as well as fluctuations in exchange
rates. The global phosphate market was relatively stable in 2012 as strong
demand in Brazil offset lower demand in China and India. The Company's plan
for mining phosphates in Israel's Barir Field (South Zohar) has reached the
planning approval stages. Non-receipt of approvals needed to mine the Barir
Field could have a significant negative impact on the Company's future mining
reserves, both in the medium and the long term.

Agreements in early 2013: During the first half of 2013, the Company will
supply 660,000 tons of potash to China, a quantity that represents more than
20% of the total potash supply contracts  announced for the first half of
2013.  ICL Fertilizers has signed 3-year framework agreements with a number of
Chinese customers for the sale of 3.3 million tons of potash at prices to be
negotiated between the parties.

The Company will also supply 820,000 tons of potash to customers in India
during 2013. This represents approximately 23% of the total potash supply
contracts announced so far in 2013.

Fertilizer market trends: According to the reports of fertilizer distributors
in Brazil, 2012 potash sales to local farmers totaled 8.1 million tons,
representing a 9% increase compared to their level in 2011. Based on this
data, it is estimated that potash inventory levels in Brazil at the end of
2012 were lower than their level at the end of 2011, leading to an expectation
for strong demand in the next fertilizing season.

During the last months of 2012, world fertilizer prices moderated, but
remained at historically high levels. The high price of agricultural products
and the reduction of world stocks of grains represent, in general, an
incentive for farmers to apply more fertilizers in order to increase their
yields and profits.

According to the Agricultural Outlook published by the US Department of
Agriculture in February 2013, the global grain stock-to-use ratio is expected
to decline to 18.6% at the end of the 2012/2013 agricultural season, compared
with 20.19% at the end of the 2011/12 season and 20.66% at the end of the
2010/11 season.

  o ICL Industrial Products: The segment's sales for the fourth quarter of
    2012 totaled $326.4 million, representing 24.4% of total revenues (before
    offsets of inter-segment sales), a 2.6% decrease compared with the fourth
    quarter of 2011, reflecting lower quantities sold, lower prices and
    exchange rate fluctuations.

For the full year, sales totaled $1,436.6 million, a 5% decrease compared with
2011. The decline reflected lower quantities sold, countered partially by
higher selling prices.  

The segment's operating income for the fourth quarter of 2012 totaled $27.2
million compared with $63.5 million for the fourth quarter of 2011. The
decrease reflected the impact of one-time expenses associated with the
segment's early retirement program. Excluding these expenses, operating income
for the quarter totaled $49 million.

For the full year, operating income totaled $230.7 million compared with
$297.7 million in 2011, its second-highest level ever. The decrease in
operating income derived from the reduced quantities sold, higher raw material
and energy costs, countered partially by higher prices. Excluding one-time
expenses associated with the segment's early retirement program, the annual
operating income totaled $253 million.

Recent developments:

Having signed an agreement in January 2012 with Dow Global Technologies for
the licensing of its patent for the manufacture of FR122P, a new bromine-based
polymeric flame retardant, ICL IP has now begun construction of new FR122P
manufacturing plants. The segment expects to be able to begin supplying
customers in the second half of 2013, which is earlier than originally
expected.

During 2012, the segment's sales of Merquel™, a new mercury emission reduction
product line, rose at a double-digit rate as compared with 2011. Sales of
Merquel™ in 2013 are expected to continue growing at a similar rate, due to
its adoption by additional U.S. power plants.

Market developments: In March 2011, the American government ended its
suspension of gas and oil exploration activities in the Gulf of Mexico and
began granting licenses for deep-water drilling in that region. Sales of
drilling fluids to the area rose throughout 2012 and have now reached
pre-freeze levels. In addition, drilling activities throughout the world have
been increasing, including deep-water drilling activities.

  o ICL Performance Products: The segment's sales for the fourth quarter of
    2012 totaled $339.2 million, representing 25.3% of total revenues (before
    offsets of inter-segment sales), a 2% increase compared with $333.3
    million for the fourth quarter of 2011. The increase reflects higher
    quantities sold.

For the full year, sales totaled $1,476.5 million, a 1% decrease compared with
2011 reflecting decreased quantities sold and the negative effect of currency
fluctuations, countered partially by price increases and the consolidation of
companies acquired during 2011.  

The segment's operating income for the quarter totaled $32.0 million, a 19%
increase compared with $26.8 million in the fourth quarter of 2011, reflecting
the higher sales. For 2012, operating income totaled $179.9 million compared
with $192.9 million in 2011, reflecting increased costs of raw materials and
energy.

Recent developments: ICL Performance Products has recently acquired the
phosphorus pentasulfide (P2S5) business aspects and operations of Thermphos
International B.V. (NL) located in Knapsack, Germany. The acquisition expands
ICL Performance Products' leadership in global markets for phosphorus-based
specialty chemicals while expanding its European footprint.

Dividends:

The Company's Board of Directors declared that a dividend totaling $147
million will be paid on April 25, 2013 in respect of its fourth quarter 2012
results. This brings total dividend paid in respect of ICL's 2012 results to
$908 million, which represents a 6.4% dividend yield based on the Company's
average share price in 2012.

About ICL

ICL is one of the world's leading fertilizer and specialty chemicals
companies. For a world challenged by the rapid growth rate of its population
and the deterioration of its scarce resources, ICL makes products that
increase global food and water supplies and improve industrial materials and
processes.

ICL produces approximately a third of the world's bromine and is the 6^th
largest potash producer in the world. ICL is a leading supplier of fertilizers
in Europe and a major player in specialty fertilizer market segments. One of
the world's most integrated manufacturers and suppliers of phosphate products,
ICL has become the world's leading provider of pure phosphoric acid and a
major specialty phosphate player.

ICL is comprised of three core segments: ICL Fertilizers, ICL Industrial
Products and ICL Performance Products. Its major production activities are
located in Israel, Europe, the US, South America and China, and are supported
by major global marketing and logistics networks. ICL extracts potash,
bromine, magnesium chloride and sodium chloride from Israel's Dead Sea, mines
phosphate rock from Israel's Negev Desert, and mines potash and salt in Spain
and the UK.

ICL's shares are traded on the Tel Aviv Stock Exchange (TASE: ICL).

Forward Looking Statement

This press release contains forward-looking assessments and judgments
regarding macro-economic conditions and the Group's markets, and there is no
certainty as to whether, when and/or at what rate these projections will
materialize. Management's projections are likely to change in light of market
fluctuations, especially in ICL's manufacturing locations and target markets.
 In addition, ICL is likely to be affected by changes in the demand and price
environment for its products as well as the cost of shipping and energy,
whether caused by actions of governments, manufacturers or consumers. ICL can
also be affected by changes in the capital markets, including fluctuations in
currency exchange rates, credit availability, interest rates, etc.  

                                           ICL
                                  PRINCIPAL FINANCIAL RESULTS
                      THREE MONTHS AND TWELVE MONTHS ENDED DECEMBER 31, 2012

                      3 months ended December      12 months ended December
                                31,                           31,
                        2012           2011           2012           2011
                      $     % of     $     % of     $      % of       $     % of
                   millions sales millions sales millions  sales  millions sales
    Net Sales      1,338.2  100.0  1,712.4  100.0  6,672.2  100.0  7,067.8  100.0
    Gross profit     507.1   37.9    775.4   45.3  2,757.2   41.3  3,155.7   44.6
    Operating
    income*          194.0   14.5    466.5   27.2  1,576.5   23.6  1,926.0   27.2
    Pre-tax income   195.9   14.6    461.5   27.0  1,526.2   22.9  1,871.7   26.5
    Net income to
    the
    Company's
    shareholders     209.5   15.7    369.6   21.6  1,300.5   19.5  1,511.8   21.4
    EBITDA**         315.7   23.6    528.6   30.9  1,911.2   28.6  2,190.2   31.0
    Operating cash
    flow             275.0           344.4         1,592.7         1,269.4
    Investment in
    property,
    plant and
    equipment less
    grants
    received         145.5           134.1           667.8           494.9

*Excluding the impact of one-time expenses associated with early retirement
plans and one time gain associated with VAT refund received by a subsidiary
abroad, operating profit for Q4'12 and 2012 totaled $238 million & 1,621
million, respectively.

** EBITDA is calculated as follows:

                       3 months ended December  12 months ended December
                                 31,                       31,
                              2012         2011         2012           2011
    Net income               209.5        369.6      1,300.5        1,511.8
    Amortization &
    depreciation              76.8         69.8        287.1          267.4
    Financing
    expenses, net             (0.8)         1.7         58.6           62.3
    Taxes on income          (13.8)        87.5        221.0          348.7
    Unusual or
    one-time expenses         44.0***         -         44.0*             -
                             _________   _______     ________       _______
    EBITDA                   315.7        528.6       1911.2        2,190.2
                             =========   =======     ========       =======

*** Mainly expenses in respect of early retirement plan.

  
                                         ICL
                            PRINCIPAL RESULTS FROM CORE
                                MANAGERIAL SEGMENTS
                       THREE MONTHS AND TWELVE MONTHS ENDED
                                 DECEMBER 31, 2012
                     3 months ended December      12 months ended December
                               31,                           31,
                       2012           2011           2012           2011
                           % of           % of           % of             % of
    Sales CIF by     $     gross    $     gross    $     gross    $      gross
    segment       millions sales millions sales millions sales millions  sales
    ICL
    Fertilizers   709.7    53.0  1,034.2   60.4s  3812.2   57.1  4,097.6  58.0
    ICL
    Industrial
    Products      326.4    24.4    335.0   19.6  1,436.6   21.5  1,513.0  21.4
    ICL
    Performance
    Products      339.2    25.3    333.3   19.5  1,476.5   22.1  1,494.8  21.1
    Other and
    offsets       (37.2)             9.8           (53.0)          (37.6)
    Total       1,338.1           1712.3         6,672.2         7,067.8

Note: Segment sales data and their percentage of total sales are before
offsets of inter-segment sales.

                   3 months ended December 31,      12 months ended December 31,
                      2012             2011             2012             2011
    Reported
    operating             % of             % of             % of             % of
    income by      $     segment    $     segment    $     segment    $     segment
    segment     millions  sales  millions  sales  millions  sales  millions  sales
    ICL
    Fertilizers
    [1]          140.0    19.7    364.6     35.3    1,158.9   30.4  1,403.4    34.2
    ICL
    Industrial
    Products
    [2]           27.2     8.3     63.5     18.9      230.7   16.1    297.7    19.7
    ICL
    Performance
    Products
    [3]           32.0     9.4     26.8      8.1      179.9   12.2    192.9    12.9
    Other and
    offsets       (5.1)            11.5                 7.0            32.0
    Total        194.0            466.5             1,576.5         1,926.0

 1. Includes a non-recurring expense in respect of an early retirement plan
    for employees, in the amount of about $33 million , which was recognized
    during the fourth quarter of 2012
 2.  Includes a non-recurring expense in respect of an early retirement plan
    for employees, in the amount of about $22 million , which was recognized
    during the fourth quarter of 2012.
 3. Includes non-recurring income in respect of a VAT refund, in the amount of
    about $ 11 million , which was received by a foreign subsidiary during the
    fourth quarter of 2012.

SOURCE ICL - Israel Chemicals Ltd
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