TEL AVIV (Reuters) - Israel Chemicals (ICL) ICL.TAICL.N reported a rise in quarterly earnings on Thursday, but said sales slipped due to a nearly one-month planned shutdown and upgrade of the company's Dead Sea facilities.
ICL said it earned 4 cents per diluted share in the fourth quarter excluding one-time items, up from 1 cent a year earlier. Sales declined to $1.1 billion from $1.4 billion.
Both results were in line with analysts’ estimate, according to I/B/E/S data from Refinitiv.
The plant upgrade is expected to increase annual potash production by about 5%.
ICL’s results were also negatively impacted by the continued delay in the signing of a potash supply agreement in China and the weak commodity fertilizer environment.
Earnings were boosted by lower financing expenses due to profit from hedging transactions.
ICL is the world’s sixth-largest producer of potash, a key ingredient in fertilizers, with exclusive rights in Israel to extract minerals from the Dead Sea.
Potash sales, which accounted for 24% of the group total, declined to $302 million in the quarter from $515 million a year earlier. The average selling price per tonne edged down to $274 from $292, while output fell to 844,000 tonnes from 1.2 billion.
Chief Executive Raviv Zoller struck an upbeat tone on the group’s outlook, while acknowledging the impact of the plant upgrade, a weak environment for commodity fertilizers and unfavorable moves in foreign exchange rates on its fourth-quarter results.
“We believe that the actions we have taken throughout 2019 have significantly strengthened ICL’s position and prospects to create value for our shareholders for years to come,” he said.
ICL extended its policy of returning up to 50% of adjusted net income to shareholders through dividends. Dividends for 2019 amounted to $0.18 per share, similar to 2018, while the company declared a quarterly dividend of 1.8 cents per share.
Reporting by Tova Cohen; Editing by Jan Harvey
Our Standards: The Thomson Reuters Trust Principles.