* Q1 EBIT I 174 mln eur, down 23 pct
* Still sees marked decline in sales, earnings in 2009
* Demand for salt shores up earnings
(Adds details, background)
FRANKFURT, May 13 German fertiliser supplier K+S
SDFG.DE reiterated that is sees a notable decline in 2009
earnings even after it posted first-quarter operating proft that
beat expectations on Wednesday.
The world's fourth-biggest potash maker said operating
profit excluding currency hedging instruments fell 23 percent to
174 million euros ($237.2 million) in the three months through
March as farmers hoping for lower prices delayed ordering
potassium chloride, the fertiliser ingredient that K+S extracts
from potash ore.
Still, that surpassed the 119 million euro average forecast
in a Reuters poll of analysts as demand for the company's road
salt rose during an unusually cold winter.
Quarterly sales fell 11 percent to 1.08 billion euros, above
the 941 million euros forecast by analysts.
"Our salt activities were able to step into the breach for
the fertiliser business," Chief Executive Norbert Steiner said
in a statement.
The mine operator reiterated it expected a notable
year-on-year decline in operating earnings and sales in 2009 as
farmers continue to hold of on fertiliser orders.
A recovery should, however, be seen in the second half, it
Prices of agricultural commodities followed the boom and
bust of financial markets over the last two years, as investors
rushed in and later abandoned the asset class, also buffeting
Fertiliser peers including Yara (YAR.OL), Mosaic (MOS.N) and
Potash Corp (POT.TO) have also raised the prospect of a pickup
in demand in the second half after posting weak first-quarter
K+S early in April agreed to buy Morton Salt from Dow
Chemical (DOW.N) for $1.675 billion including assumed debt,
making the German mine operator the world's largest salt
K+S shares change hands for 10.1 times estimated earnings
for the coming 12 months, according to StarMine, which weights
estimates according to analysts' track record.
Potash Corp of Saskatchewan (POT.TO) the world's No.1 potash
producer, trades at a multiple of about 10.7. Mosaic (MOS.N),
another rival, has a multiple of about 6.5.
(Reporting by Ludwig Burger)