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OCI Announces 9M 2012 Results

CAIRO, EGYPT -- (Marketwire) -- 11/28/12 --

Results as at 30 September 2012

Cairo, Egypt / 28 November, 2012 8:00 AM

    OCI Reports 31% Decline in Earnings During the Third Quarter

Summary of Consolidated Results for Q3 2012 (1):

- Consolidated revenues increased 1.0% to USD 1,371.1 million (EGP
8,305.3 million) versus USD 1,357.8 million (EGP 8,093.7 million) in
Q3 2011

- EBITDA decreased 18.9% to USD 300.6 million (EGP 1,821.1 million)
versus USD 370.6 million (EGP 2,208.7 million) in Q3 2011

- Consolidated EBITDA margin of 21.9% and Construction Group EBITDA
margin of 9.0% duringQ3 2012

- Net income decreased 30.7% to USD 126.8 million (EGP 769.2
million) versus USD 182.9 million (EGP 1,090.2 million) in Q3 2011
Summary of Consolidated Results for 9M 2012:

- Consolidated revenues decreased 2.3% to USD 3,999.2 million (EGP
24,174.3 million) versus USD 4,092.9 million (EGP 24,237.1 million)
in 9M 2011

- EBITDA decreased 20.4% to USD 848.4 million (EGP 5,127.1
million) versus USD 1,066.0 million (EGP 6,312.7 million) in 9M 2011

- Consolidated EBITDA margin of 21.2% and Construction Group EBITDA
margin of 10.4% during9M 2012

- Net income decreased 38.6% to USD 340.7 million (EGP 2,059.0
million) versus USD 554.7 million (EGP 3,281.9 million) in 9M 2011

Consolidated Construction Group Backlog

- Consolidated backlog as at 30 September 2012 stood at USD 5.64
billion reflecting a decrease of 4.3% over the backlog as at 30 June
2012 and a decrease of 5.2% over the same period last year

- New awards totaled USD 361.5 million during the quarter

- Infrastructure and industrial work constitute 66.6% of the
Construction Group backlog as at 30 September 2012

(1) Consolidated financial figures presented in this press release are

Statement from the Chairman and Chief Executive Officer - Nassef

Our third quarter results have declined year-on-year. EBITDA and net
income fell by 18.9% and 30.7% respectively primarily due to the
seasonal slowdown in the Construction Group's work and a decline in
margin from 10.8% during the second quarter to 9.0% during the third
quarter as a result of some provisioning on several projects. Overall,
net income increased from USD 119.4 million in the second quarter to
USD 126.8 million in the third quarter on the back of strong results
from the Fertilizer Group.

In November, natural gas supply to both our plants in Egypt witnessed
drastic supply cuts arising from unscheduled stoppages in the natural
gas grid for maintenance works. The pressure is only gradually
returning in the third week of disruptions and stoppages. In order to
minimize production down time, EBIC successfully brought forward its
scheduled three week maintenance turnaround from the fourth week of
November to the second week. EFC has also brought forward its revamp/
maintenance turnaround at one of its urea lines from the first quarter
of 2013 to the fourth quarter of 2012. The natural gas supply
shortfalls will have an impact on our fourth quarter production
utilization rates and results.

We continue to expect strong demand for our fertilizer products
supported by strong fundamentals. Farmers in the United States have
witnessed record income despite the fall in yields. A drop in yields
and growing demand for crops (especially corn and wheat) will bode well
for fertilizer prices.

In the United States, both OCI Beaumont and Iowa Fertilizer Company
(IFCo) have made noticeable progress over the last several months. OCI
Beaumont's ammonia and methanol lines are now operational. The plant is
now producing ammonia at the designed capacity of 250 thousand tons and
methanol at 70-80 % of designed capacity of 750 thousand tons per annum.

IFCo, our new Greenfield plant in Wever, Iowa, was issued its air
permit by the Iowa Department of Natural Resources (IDNR) last month
and the plant broke ground last week in an event attended by the
Governor of Iowa. The Construction Group was awarded the Engineering,
Procurement and Construction (EPC) contract to build the plant and
Maire Tecnimont and ThyssenKrupp Uhde will be supplying
state-of-the-art technology for the project. The construction of the
plant is scheduled for completion during the summer of 2015. The plant
will produce 1.5 - 2.0 million metric tons of urea, urea ammonium
nitrate (UAN), ammonia and diesel exhaust fluid (DEF) upon completion
and will supply farmers in the US Corn Belt. The total investment cost
of the project is now expected to be approximately USD 1.65 billion
and will be funded with a combination of equity and a tax-exempt bond

In Algeria, Sorfert Algeria expects to complete all mechanical works on
Line II at the end of December. Once these works are complete, all
necessary permits will be obtained during the first quarter of 2013
ahead of the planned full-fledged commercial production. Our team is
working closely with our partner to ensure all planned works are
complete on time and all necessary permits are obtained. We expect
Sorfert Algeria to start contributing to earnings during the first half
of 2013.

In addition, the Fertilizer Group announced that it has acquired
distribution rights of ammonium sulphate (AS) produced by Lanxess N.V.
at its Antwerp facilities in Belgium. The distribution rights were
acquired from Fertiva GmbH, a wholly owned subsidiary of Eurochem. The
deal entails up to approximately 1 million metric tons of AS including
granular AS, a premium fertilizer product. OCI's wholly owned
subsidiary, Netherlands-based OCI Nitrogen currently distributes
approximate 0.75 million metric tons of AS produced by DSM N.V. in the
Netherlands. Combined, the Fertilizer Group expects to annually
distribute 1.75 million tons of AS in both standard and granular form,
making it a leading supplier in the European market and in Brazil.

The Construction Group reported a 4.3% decrease in backlog over the
previous quarter and the backlog as at the end of the third quarter
stood at USD 5.64 billion. New work secured during the third quarter
totaled USD 361.5 million and USD 1.49 billion during the first nine
months. The Group is increasing its focus on the United States'
infrastructure program and petrochemical construction market in
addition to expanding its presence and work in Saudi Arabia and Iraq.

The Construction Group recently announced that it will acquire the
Weitz Company, a general contractor based in Des Moines, Iowa. The
Group has already received Weitz's Board approval for the transaction
and an agreement has been signed. At present, final shareholders'
approval is pending but expected imminently. The Group is expected to
pay a total consideration of less than USD 90 million on an enterprisevalue

The Weitz Company will be pivotal in the construction of IFCo and will
allow the Construction Group to bid on infrastructure and industrial
opportunities in the United States market in addition to commercial and
federal work. We expect to start consolidating Weitz's results and
backlog during the fourth quarter.

The Egyptian Tax Authority has been reviewing the tax years 2005 -
2010. Our auditors and tax advisors have presented all necessary
documentation to the authorities. We are confident that new laws will
not be applied retroactively and that our legal and financial position
is in accordance with paragraph 8 of article no. 50 of law no. 91 of
2005, which clearly exempts all capital gains resulting from the sale
of shares listed on the Egyptian Stock Exchange (EGX).

On the planned demerger of the company's construction business from its
fertilizer business, we continue to work with the Egyptian Financial
Supervisory Authority (EFSA) to receive final procedural approvals for
the demerger, however no progress has taken place since October.

For additional information contact:
OCI Investor Relations Department:
Omar Darwazah
Email: [email protected]

Erika Wakid
Email: [email protected]
Hassan Badrawi

Tel: +202 2461 1036/0727/0917
Fax: +202 2461 9409

For additional information on OCI:


OCI stock symbols: OCIC.CA / OCIC EY / OCICqL / ORSD / ORSCY

Orascom Construction Industries (OCI)
Nile City Towers - South Tower
2005A Corniche El Nil
Cairo, Egypt

                    This information is provided by RNS
          The company news service from the London Stock Exchange


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