OAO Acron, a Russian fertilizer producer, said profit more than tripled last year as prices and output increased. Borrowings jumped 20 percent.
Net income advanced to 18.3 billion rubles ($622 million) from 5.58 billion rubles a year earlier, the Velikiy Novgorod-based company said in a statement. Net debt rose to 31.8 billion rubles ($1.14 billion) from 28.3 billion rubles, exceeding a $1.03 billion estimate from Russian bank VTB Capital.
“Acron’s results came in mixed,” said Kevin Whyte, an analyst at VTB Capital in Moscow. “While the company was expected to benefit from higher fertilizer prices, the higher-than-expected increase in costs and net debt was a negative surprise.”
Acron, which produces nitrogen fertilizers, has borrowed funds to expand as it diversifies into phosphates and potash. The company obtained a $1.1 billion loan from state development bank VEB for its Talitsky potash project last year. It also earmarked $400 million to build an ammonia plant in Velikiy Novgorod and last month opened a new $95 million urea factory.
Acron fell as much as 0.6 percent and traded little changed at 1,402 rubles as of 6:30 p.m. in Moscow.
The company’s ratio of net debt to earnings before interest, tax, depreciation and amortization declined to 1.6 last year from 2.7 in 2010, it said. The cost of sales rose 27 percent to 35 billion rubles.