* Cuts adj EBIT outlook to lower end of previous range
* Sees 2013 adj EBIT up slightly, worse than expected
* Protracted talks with buyers India, China weigh on prices
* Shares lose 4.7 percent
FRANKFURT, Nov 13 German potash and salt miner
K+S cut its 2012 profit outlook on Tuesday and said
it was concerned about next year due to a decline in prices for
its fertiliser minerals.
K+S now expects 2012 earnings before interest and tax,
adjusted for currency hedging effects, to reach about 820
million euros ($1.04 billion), at the bottom of its previously
targeted range of 820-900 million euros, and down from 906.2
million last year.
The shares lost 4.7 percent to 34.22 euros at 0942 GMT,
making them the second-worst performer on Germany's blue chip
Drawn-out talks between K+S's larger rivals in Canada and
Russia, and potash importers China and India, among the world's
largest users of the plant nutrient, have resulted in a decline
in global potash prices at the end of the third quarter.
Even though K+S exports very little to China and India and
derives more than half of its potash revenues from Europe, it
will be hit by the global decline in prices.
"(This) leads to an overall cautious assessment," the group
said in a statement.
K+S, the world's fourth-largest potash miner, also dampened
market expectations for next year's earnings, saying annual
average potash prices would be slightly lower than in 2012.
It sees a slight increase in 2013 adjusted EBIT from the 820
million predicted for this year, while analysts had projected
978 million in 2013 adjusted EBIT.
"We believe K+S will struggle to grow earnings in 2012 and
2013," Sanford Bernstein analyst Jeremy Redenius said, citing
higher costs, nearly flat potash volumes due to production
constraints and limited domestic reserves and increasing
pressure on potash prices.
Third-quarter adjusted EBIT came in at 156.7 million euros,
below the 166 million euro average estimate in a Reuters poll of
10 banks and brokerages.
Analysts had expected Canadian suppliers including Potash
Corp to renew supply contracts with China and India in
late summer, but now they say it may take until late 2012 or
Potash Corp took a direct hit from the delay. Third-quarter
earnings at the industry's No.1 fell 22 percent as a standoff
over new contracts led to a sharp drop in shipments to China and
China is seen as being well supplied with the crop nutrient,
while a reduction in Indian subsidies and a weaker rupee have
made potash more expensive for that nation's farmers.