|By PR Newswire||
|November 21, 2012 02:02 AM EST||
TEL AVIV, Israel, November 21, 2012 /PRNewswire/ --
- ICL's Leading Market Positions & Balanced Portfolio Continue to Counterbalance External Headwinds
- Q3'12 Revenues Down $9M Compared with Q3'11 Before Exchange Rate Fluctuations, Which Accounted for $72M
- In Contrast to Low Demand in World Potash Markets, ICL Fertilizers' Q3 Potash Shipments Were Similar to Their Level in Q3'11
- Weak Global Economic Environment Impacting ICL-IP & ICL-PP Less Than In Previous Cycles
ICL (TASE:ICL), a multinational fertilizer and specialty chemicals company, today reported its financial results for the third quarter ended September 30, 2012.
Mr. Stefan Borgas, ICL's CEO since September 20, 2012, commented: "Despite the challenging global economic environment, ICL continues to demonstrate resilience due to its numerous leading market positions and a balanced portfolio that counterbalances low economic growth. The products that we manufacture for the agriculture, food, water and materials markets are an answer to the essential, fundamental requirements of the world's growing population. ICL develops products and processes that will enable it to grow and strengthen the contribution that it makes to consumers in these critical areas."
Revenues: ICL's revenues for the third quarter of 2012 totaled $1,817.5 million, an $81 million decline compared with $1,898.3 million in the third quarter of 2011. The decrease was due primarily to the impact of unfavorable exchange rate fluctuations, which accounted for approximately $72 million of the difference. The Company's revenues during the quarter were enhanced by the consolidation of companies acquired during the past 12 months.
For the nine-month period, sales totaled $5,334.2 million compared with $5,355.5 million in the first nine months of 2011, a decline of approximately $21 million. Excluding the impact of unfavorable exchange rate fluctuations (primarily the Euro/dollar exchange rate), which reduced revenues by approximately $155 million, the Company's sales for the quarter would have risen by $134 million for the nine-month period. This reflected the rise of prices, on average, and the stable quantities sold, coupled with the contribution of newly-consolidated companies acquired during the past 12 months.
Gross profit: Gross profit for the third quarter totaled $786.0 million compared with $871.4 million in the third quarter of 2011. The decline reflected the period's lower sales, coupled with the impact of increased raw material, energy and other costs. Gross margin for the period was 43.2% compared with 45.9% for the third quarter of 2011.
For the nine-month period, gross profit totaled $2,250.1 million, a 5% decline compared with $2,380.2 million in the first nine months of 2011. Gross margin for the period was 42.2% compared with 44.4% for the first nine months of 2011.
Operating income: Operating income for the third quarter of 2012 was $487.9 million compared with $556.2 million for the third quarter of 2011. For the nine-month period, operating income totaled $1,382.5 million, a 5% decline compared with $1,459.5 million in the first nine months of 2011. The decrease derived from the reduction in the gross margin, countered partially by reduced sales, marketing and administrative expenses.
Net income: Net income to shareholders for the third quarter of 2012 totaled $394.8 million compared with $436.3 million in the parallel period of 2011. For the nine-month period, net income to shareholders totaled $1,091.0 million compared with $1,142.2 million in the first nine months of 2011.
Cash flow: During the third quarter of 2012, operating cash flow totaled $680.1 million, a 36% increase compared with $498.8 million in the third quarter of 2011. For the nine-month period, cash flow totaled $1,317.7 million, an increase of 42% compared with $925.0 million for the first nine months of 2011.
- The continued decline of global grain stock-to-use ratios to historically low levels, as predicted by the U.S. Department of Agriculture, and other indicators point to a market environment that will support strong sales of fertilizers in the 2013 planting season.
- The completion of potash deliveries under the framework of existing contracts signed with customers in India and China, coupled with the delay of new contract renewals with these customers, is expected to reduce potash shipments during the fourth quarter as compared with the fourth quarter of 2011.
- ICL continues manufacturing potash at its normal rate, benefiting from its strategic ability to store very large quantities of potash outdoors.
- Due to the decrease in demand for flame retardants during the third quarter, production was halted at one of ICL Industrial Products' production units. This shutdown is expected to continue into the fourth quarter.
- Due to the seasonality of ICL Performance Products' sales of some of its products, especially its fire safety products, and the general holiday-related slowdown of sales in December, the fourth quarter is generally characterized by lower profit margins.
Highlights of Core Business Segments
- ICL Fertilizers: The segment's sales for the third quarter of 2012 totaled $1.1 billion, representing 55.7% of total revenues (before offsets of inter-segment sales), a decline of approximately 5% compared with Q3 2011. This moderate decline during a period of low overall potash demand reflected primarily the impact of unfavorable exchange rate fluctuations, as explained above, and the segment's strong potash sales to Indian and Brazilian customers during the quarter, which compensated for weak sales to customers in China and other markets. During the third quarter and also in October 2012, the Company's potash deliveries to India that had been called for under the framework of supply agreements signed during the second half of 2011 (but that had been delayed beyond the original agreed-upon dates) were completed.
Despite declining world sales of potash during the quarter, the segment sold 1,390 thousand tons of potash (including internal sales) during the third quarter of 2012, a quantity that was almost unchanged from that sold during the third quarter of 2011. However, the completion of existing contracts coupled with delayed renewals of contracts in India and China is expected to reduce the Company's Q4 2012 potash shipments as compared with Q4 2011. The quantity of phosphate fertilizers sold during Q3 2012 totaled 458 thousand tons compared with 456 tons in Q3 2011.
For the nine-month period, sales totaled $3.1 billion, representing 55.1% of total revenues (before offsets of inter-segment sales), a 1% increase compared with the first nine months of 2011. The increase derived from a rise in the segment's prices, on average, during the year, together with the consolidation, for the first time, of companies acquired during the past 12 months. This was countered partially by unfavorable fluctuations of key exchange rates, as explained above, and reduced quantities sold during the period. During the period, the Company sold 3,821 thousand tons of potash (including internal sales) and 1,298 thousand tons of phosphate fertilizers.
ICL Fertilizers' operating income for the third quarter of 2012 totaled $367 million, representing an operating margin of 34%. For the nine-month period, operating income totaled $1,019 million, representing an operating margin of 33%.
Fertilizer market trends: World potash markets during Q3 2012 exhibited low demand as compared with Q3 2011. This decline derived primarily from delays in the renewal of potash supply agreements with China and India, Europe's ongoing financial crisis and droughts in North America. In contrast, Brazil exhibited strong demand for potash, with the total quantities imported during the first nine months of 2012 nearly reaching the record levels recorded in 2011.
In India, demand for phosphate fertilizers has begun to decline due to reduced government subsidies, which result in increased fertilizer prices to the end-user, together with the devaluation of the Indian rupee as compared with the U.S. dollar, and the delay of the monsoon season. During the last several weeks, the rainy season has begun, resulting in an increase in fertilizer demand and a stabilization of the market.
In October 2012, the US Department of Agriculture published its 2012/13 Agricultural Outlook, and once again reduced its forecast regarding the quantity of crops expected to be harvested due to the year's hot and dry weather, the severe draught in U.S. growing regions and dryer-than-normal weather in Russia, the Ukraine and Kazhakstan. These developments have led to continued rises in the prices of corn, wheat and soy and a further decline in grain stock-to-use ratios, developments that are expected to improve demand for fertilizer in the next agricultural season. According to the report, the global grain stock-to-use ratio is forecast to decline to 18.5% at the end of the 2012/2013 agricultural season, compared with 20.48% at the end of the 2011/12 season and 20.7% at the end of the 2010/11 season.
- ICL Industrial Products: The segment's sales for the third quarter of 2012 totaled $347 million, representing 18.1% of total revenues (before offsets of inter-segment sales), compared with $381 million for the third quarter of 2011. The decline reflected lower quantities sold coupled with unfavorable fluctuations in exchange rates, countered partially by increased selling prices. For the nine-month period, sales totaled $1,110 million, a 6% decrease compared with the first nine months of 2011.
The segment's operating income for the third quarter of 2012 totaled $59 million compared with $76 million for the third quarter of 2011. The decrease in operating income derived from the reduced quantities sold, coupled with higher raw material and energy costs and unfavorable exchange rate fluctuations. For the first nine months of 2012, operating income totaled $204 million compared with $234 million in the parallel period of 2011.
Market developments: During the past year, the economic slowdown throughout the world and especially in China has led to reduced demand for the brominated flame retardants that are used in electronics and products for the building industry. In parallel, China's demand for elemental bromine has declined, leading to reduced selling prices there.
In contrast, demand for drilling fluids has been rising throughout 2012 due to an increase in the deep-water gas and oil exploration activities in the Gulf of Mexico.
- ICL Performance Products: The segment's sales for the third quarter of 2012 totaled $416 million, representing 21.7% of total revenues (before offsets of inter-segment sales), a 3% increase compared with $403 million for the third quarter of 2011. The increase reflects higher quantities sold, coupled with the consolidation, for the first time, of companies that were acquired during the past 12 months. The increase was countered partially by the negative impact of exchange rate fluctuations, especially the Euro vs. the U.S. dollar. For the nine-month period, sales totaled $1,137 million, a 2% decrease compared with the first nine months of 2011.
The segment's operating income for the quarter totaled $60 million, a 13% increase compared with $53 million in the third quarter of 2011. The increase derived from the increased sales, countered partially by the increased costs of raw materials and energy. For the first nine months of 2012, operating income totaled $148 million compared with $166 million in the parallel period of 2011.
Market developments: During the third quarter, the trends that characterized the global market throughout the year, including the lack of certainty regarding global economic stability, political instability in the Middle East, the slow recovery of markets in the U.S., continued to affect markets for the majority of products that use the segment's offerings. In addition, the slowdown of fertilizer markets, whose by-products are raw materials for the segment's products, increased the price of the segment's inputs, primarily in Europe. However, prices of these components in the U.S. remained stable.
- On April 30, 2012, the Company paid a dividend totaling $260 million in respect of its fourth quarter 2011 results. This brought the total dividend paid in respect of 2011 results to $1,053 million.
- On June 26, 2012, the Company paid a dividend totaling $200 million in respect of its first quarter 2011 results.
- On September 12, 2012, the Company paid a dividend totaling $285 million in respect of its second quarter 2012 results.
- The Company's Board of Directors today declared that a dividend totaling $276 million will be paid on December 19, 2012 in respect of its third quarter 2012 results.
ICL is one of the world's leading fertilizer and specialty chemicals companies. For a world challenged by population growth and 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 6th 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.
PRINCIPAL FINANCIAL RESULTS
THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2012
3 months ended September 9 months ended September 30, 30, 2012 2011 2012 2011 $ % of $ % of $ % of $ % of millions sales millions sales millions sales millions sales Net Sales 1,817.5 100.0 1,898.3 100.0 5,334.2 100.0 5,355.5 100.0 Gross profit 786.0 43.2 871.4 45.9 2,250.1 42.2 2,380.2 44.4 Operating income 487.9 26.8 556.2 29.3 1,382.5 25.9 1,459.5 27.3 Pre-tax income 477.1 26.3 542.6 28.6 1,330.2 24.9 1,410.2 26.3 Net income to the Company's shareholders 394.8 21.7 436.3 23.0 1,091.0 20.5 1,142.2 21.3 EBITDA* 561.7 30.9 631.8 33.3 1,595.5 29.9 1,661.6 31.0 Operating cash flow 680.1 498.8 1,317.7 925.0 Investment in property, plant and equipment less grants received 192.2 156.4 522.0 360.8
* EBITDA is calculated as follows:
3 months ended Sept. 30, 9 months ended Sept. 30, 2012 2011 2012 2011 Net income 394.8 436.3 1,091.0 1,142.2 Amortization & depreciation 72.4 75.1 210.3 197.7 Financing expenses, net 13.4 16.3 59.4 60.5 Taxes on income 81.0 104.1 234.8 261.2 Unusual or one-time expenses EBITDA 561.7 631.7 1,595.5 1,661.6
PRINCIPAL RESULTS FROM CORE
THREE MONTHS AND NINE MONTHS ENDED
SEPTEMBER 30, 2012
3 months ended September 9 months ended September 30, 30, 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 1,066.3 55.7 1,126.0 56.1 3,102.4 55.1 3,063.5 54.3 ICL Industrial Products 346.6 18.1 380.7 19.0 1,110.2 19.7 1,178.0 20.9 ICL Performance Products 415.7 21.7 403.1 20.1 1,137.3 20.2 1,161.5 20.6 Other and offsets (11.1) (11.5) (15.7) (47.5) Total 1,817.5 1,898.3 5,334.2 5,355.5
Note: Segment sales data and their percentage of total sales are before offsets of inter-segment sales.
3 months ended September 30, 9 months ended September 30, 2012 2011 2012 2011 Operating % of % of % of % of income by $ segment $ segment $ segment $ segment segment millions sales millions sales millions sales millions sales ICL Fertilizers 366.9 37.0 416.3 37.0 1,018.9 33.9 1,038.8 33.9 ICL Industrial Products 58.6 19.9 75.9 19.9 203.6 19.9 234.2 19.9 ICL Performance Products 59.9 13.1 52.9 13.1 147.9 14.3 166.0 14.3 Other and offsets 2.5 11.1 12.1 20.5 Total 487.9 556.2 1,382.5 1,459.5
Fleisher Communications and Public Relations
SOURCE ICL - Israel Chemicals Ltd
The IoT has the potential to create a renaissance of manufacturing in the US and elsewhere. In his session at 18th Cloud Expo, Florent Solt, CTO and chief architect of Netvibes, will discuss how the expected exponential increase in the amount of data that will be processed, transported, stored, and accessed means there will be a huge demand for smart technologies to deliver it. Florent Solt is the CTO and chief architect of Netvibes. Prior to joining Netvibes in 2007, he co-founded Rift Technol...
May. 1, 2016 11:00 PM EDT Reads: 1,584
The increasing popularity of the Internet of Things necessitates that our physical and cognitive relationship with wearable technology will change rapidly in the near future. This advent means logging has become a thing of the past. Before, it was on us to track our own data, but now that data is automatically available. What does this mean for mHealth and the "connected" body? In her session at @ThingsExpo, Lisa Calkins, CEO and co-founder of Amadeus Consulting, will discuss the impact of wea...
May. 1, 2016 07:00 PM EDT Reads: 739
SYS-CON Events announced today that Peak 10, Inc., a national IT infrastructure and cloud services provider, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Peak 10 provides reliable, tailored data center and network services, cloud and managed services. Its solutions are designed to scale and adapt to customers’ changing business needs, enabling them to lower costs, improve performance and focus inter...
May. 1, 2016 06:00 PM EDT Reads: 1,145
We’ve worked with dozens of early adopters across numerous industries and will debunk common misperceptions, which starts with understanding that many of the connected products we’ll use over the next 5 years are already products, they’re just not yet connected. With an IoT product, time-in-market provides much more essential feedback than ever before. Innovation comes from what you do with the data that the connected product provides in order to enhance the customer experience and optimize busi...
May. 1, 2016 05:00 PM EDT Reads: 1,009
In his session at @ThingsExpo, Chris Klein, CEO and Co-founder of Rachio, will discuss next generation communities that are using IoT to create more sustainable, intelligent communities. One example is Sterling Ranch, a 10,000 home development that – with the help of Siemens – will integrate IoT technology into the community to provide residents with energy and water savings as well as intelligent security. Everything from stop lights to sprinkler systems to building infrastructures will run ef...
May. 1, 2016 04:00 PM EDT Reads: 925
So, you bought into the current machine learning craze and went on to collect millions/billions of records from this promising new data source. Now, what do you do with them? Too often, the abundance of data quickly turns into an abundance of problems. How do you extract that "magic essence" from your data without falling into the common pitfalls? In her session at @ThingsExpo, Natalia Ponomareva, Software Engineer at Google, will provide tips on how to be successful in large scale machine lear...
May. 1, 2016 01:45 PM EDT Reads: 1,229
Digital payments using wearable devices such as smart watches, fitness trackers, and payment wristbands are an increasing area of focus for industry participants, and consumer acceptance from early trials and deployments has encouraged some of the biggest names in technology and banking to continue their push to drive growth in this nascent market. Wearable payment systems may utilize near field communication (NFC), radio frequency identification (RFID), or quick response (QR) codes and barcodes...
May. 1, 2016 01:30 PM EDT Reads: 810
SYS-CON Events announced today that Stratoscale, the software company developing the next generation data center operating system, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Stratoscale is revolutionizing the data center with a zero-to-cloud-in-minutes solution. With Stratoscale’s hardware-agnostic, Software Defined Data Center (SDDC) solution to store everything, run anything and scale everywhere...
May. 1, 2016 01:30 PM EDT Reads: 1,570
Angular 2 is a complete re-write of the popular framework AngularJS. Programming in Angular 2 is greatly simplified – now it's a component-based well-performing framework. This immersive one-day workshop at 18th Cloud Expo, led by Yakov Fain, a Java Champion and a co-founder of the IT consultancy Farata Systems and the product company SuranceBay, will provide you with everything you wanted to know about Angular 2.
May. 1, 2016 01:00 PM EDT Reads: 1,745
You think you know what’s in your data. But do you? Most organizations are now aware of the business intelligence represented by their data. Data science stands to take this to a level you never thought of – literally. The techniques of data science, when used with the capabilities of Big Data technologies, can make connections you had not yet imagined, helping you discover new insights and ask new questions of your data. In his session at @ThingsExpo, Sarbjit Sarkaria, data science team lead ...
May. 1, 2016 12:45 PM EDT Reads: 815
SYS-CON Events announced today that Men & Mice, the leading global provider of DNS, DHCP and IP address management overlay solutions, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. The Men & Mice Suite overlay solution is already known for its powerful application in heterogeneous operating environments, enabling enterprises to scale without fuss. Building on a solid range of diverse platform support,...
May. 1, 2016 12:15 PM EDT Reads: 2,324
You deployed your app with the Bluemix PaaS and it's gaining some serious traction, so it's time to make some tweaks. Did you design your application in a way that it can scale in the cloud? Were you even thinking about the cloud when you built the app? If not, chances are your app is going to break. Check out this webcast to learn various techniques for designing applications that will scale successfully in Bluemix, for the confidence you need to take your apps to the next level and beyond.
May. 1, 2016 11:45 AM EDT Reads: 1,494
Whether your IoT service is connecting cars, homes, appliances, wearable, cameras or other devices, one question hangs in the balance – how do you actually make money from this service? The ability to turn your IoT service into profit requires the ability to create a monetization strategy that is flexible, scalable and working for you in real-time. It must be a transparent, smoothly implemented strategy that all stakeholders – from customers to the board – will be able to understand and comprehe...
May. 1, 2016 11:00 AM EDT Reads: 1,092
Increasing IoT connectivity is forcing enterprises to find elegant solutions to organize and visualize all incoming data from these connected devices with re-configurable dashboard widgets to effectively allow rapid decision-making for everything from immediate actions in tactical situations to strategic analysis and reporting. In his session at 18th Cloud Expo, Shikhir Singh, Senior Developer Relations Manager at Sencha, will discuss how to create HTML5 dashboards that interact with IoT devic...
May. 1, 2016 09:45 AM EDT Reads: 1,018
Artificial Intelligence has the potential to massively disrupt IoT. In his session at 18th Cloud Expo, AJ Abdallat, CEO of Beyond AI, will discuss what the five main drivers are in Artificial Intelligence that could shape the future of the Internet of Things. AJ Abdallat is CEO of Beyond AI. He has over 20 years of management experience in the fields of artificial intelligence, sensors, instruments, devices and software for telecommunications, life sciences, environmental monitoring, process...
May. 1, 2016 09:45 AM EDT Reads: 927
SYS-CON Events announced today that Ericsson has been named “Gold Sponsor” of SYS-CON's @ThingsExpo, which will take place on June 7-9, 2016, at the Javits Center in New York, New York. Ericsson is a world leader in the rapidly changing environment of communications technology – providing equipment, software and services to enable transformation through mobility. Some 40 percent of global mobile traffic runs through networks we have supplied. More than 1 billion subscribers around the world re...
May. 1, 2016 07:30 AM EDT Reads: 978
There is an ever-growing explosion of new devices that are connected to the Internet using “cloud” solutions. This rapid growth is creating a massive new demand for efficient access to data. And it’s not just about connecting to that data anymore. This new demand is bringing new issues and challenges and it is important for companies to scale for the coming growth. And with that scaling comes the need for greater security, gathering and data analysis, storage, connectivity and, of course, the...
May. 1, 2016 07:00 AM EDT Reads: 852
SYS-CON Events announced today that DatacenterDynamics has been named “Media Sponsor” of SYS-CON's 18th International Cloud Expo, which will take place on June 7–9, 2016, at the Javits Center in New York City, NY. DatacenterDynamics is a brand of DCD Group, a global B2B media and publishing company that develops products to help senior professionals in the world's most ICT dependent organizations make risk-based infrastructure and capacity decisions.
May. 1, 2016 06:30 AM EDT Reads: 2,502
Machine Learning helps make complex systems more efficient. By applying advanced Machine Learning techniques such as Cognitive Fingerprinting, wind project operators can utilize these tools to learn from collected data, detect regular patterns, and optimize their own operations. In his session at 18th Cloud Expo, Stuart Gillen, Director of Business Development at SparkCognition, will discuss how research has demonstrated the value of Machine Learning in delivering next generation analytics to im...
Apr. 30, 2016 04:15 PM EDT Reads: 1,705
This is not a small hotel event. It is also not a big vendor party where politicians and entertainers are more important than real content. This is Cloud Expo, the world's longest-running conference and exhibition focused on Cloud Computing and all that it entails. If you want serious presentations and valuable insight about Cloud Computing for three straight days, then register now for Cloud Expo.
Apr. 30, 2016 02:30 PM EDT Reads: 1,732