Nov. 21 (Bloomberg) -- Orascom Construction Industries, Egypt’s biggest publicly traded builder, said third-quarter profit rose 30 percent on higher income from its fertilizer business.
Net income climbed to 1.09 billion Egyptian pounds ($182 million) from 839.7 million pounds a year earlier, the Cairo-based company said in a statement on its website today. Orascom, which owns fertilizer assets in Egypt, Algeria, the Netherlands and a recently-announced joint-venture in Brazil, said it will take full control of Texas-based Pandora Methanol LLC after acquiring stock from minority shareholders.
So-called “average netbacks” on third-quarter urea sales rose more than 25 percent from the previous quarter, the company said. “Nitrogen-based fertilizer prices have been stable with a favorable outlook,” Orascom added.
“We expect fertilizer prices to remain buoyant for this season, especially one thing that might give a huge boost is that currently there is talk about imposing sanctions on Iran’s petrochemical industry,” Nassef Sawiris, the company’s Chairman and Chief Executive Officer, said in a telephone interview after the results were released.
Sorfert Algeria, the Algerian unit, is scheduled to state production in the next four to eight weeks, with the first shipment of fertilizer in February. Sorfert will add 1.2 million tons of urea and 800,000 tons of ammonia a year, the company said.
OCI Nitrogen’s expansion of a calcium ammonium nitrate line in the Netherlands is “on track” for completion in the first quarter 2012 and will add about 300,000 tons, or 25 percent, of additional capacity, the company said in the statement. The unit, previously called Royal DSM, will restart a 30,000-ton melamine plant in Geleen, which has been shut down since 2008, Orascom said.
Construction backlog rose 13.6 percent from the previous quarter, bringing contract awards for the first nine months of the year to $2.74 billion, the company said. “We’re becoming more diversified,” Sawiris said. “We’re more into Saudi Arabia, we’re more into the Emirates, Qatar, Morocco. We’re pursuing Iraq.”
Orascom shares fell 3.2 percent yesterday to 220.35 pounds, giving the company a market value of 45.59 billion pounds. The shares have declined 23 percent for the year compared to a 44 percent drop for Egypt’s benchmark EGX 30 Index.
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