* Q3 oper profit up sixfold at 502.2 mln euros
* Beats 430 mln euro poll estimate
* Tones down FY sales outlook but sees gain in 2009
* Shares rise as much as 6 percent before retreating
(Adds shares, details, background, analyst comment)
By Ludwig Burger
FRANKFURT, Nov 12 German fertiliser supplier K+S
SDFG.DE toned down its 2008 sales outlook to reflect the more
cautious earnings forecast it issued last month but added that a
rebound in fertiliser demand could be in the offing next year.
The world's fourth-largest potash miner expects group sales
to increase in 2009, banking on a rebound in grain prices
because the current slump lacked a "fundamental explanation", it
said on Wednesday.
Third-quarter operating profit jumped more than sixfold,
better than expected, on surging demand for its plant nutrients
potash and magnesium.
Its shares climbed as much as 6 percent in early trade but
were down 2.1 percent at 32.65 euros by 0956 GMT, while the
German benchmark DAX was off 0.4 percent.
Quarterly earnings before interest and taxes and excluding
swings in currency hedging instruments (EBIT I) jumped to 502.2
million euros ($640 million) from 79 million euros a year
earlier, exceeding the average estimate of 430 million euros in
a Reuters survey of 11 analysts.
The company, also the world's second-largest salt producer
after China's National Salt, reiterated its full-year outlook
for EBIT I of 1.4 billion euros.
K+S cut its 2008 earnings outlook in October, just two
months after lifting it, after the financial crisis put an
abrupt end to the agricultural commodities boom, suppressing
Full-year sales should rise to just under 5.3 billion euros,
the lower end of its previous target range of 5.3-5.5 billion
euros, it said on Wednesday.
Financial investors who took on debt to bet on rising soft
commodities prices have started selling to deleverage.
Commerzbank analyst Stephan Kippe said the slump in grain
prices was as much an exaggeration as the boom that preceded it,
and maintained his "buy" rating on K+S.
"Even in a global recession, food demand would remain flat
for maybe a year at worst but would not fall because of
population growth," he said. "Even a further decline in grain
prices would make an even stronger rebound at a later stage
Potassium chloride, which is extracted from potash ore, is
one of three main nutrients used in synthetic fertilisers
alongside nitrogen and phosphorus.
K+S shares trade at 4 times estimated 2009 earnings after
they slumped from their record high of 95.9 euros in June to
below 34 euros.
Potash Corp of Saskatchewan (POT.TO), the world's No. 1
potash producer, trades at about 4.7 times earnings, while the
multiple for Mosaic (MOS.N), another rival, is about 3.
(Editing by Will Waterman)