Acron Group Releases 9M11 Operating Results

 Acron Group’s Consolidated Output (Operating Results for Acron, Dorogobuzh and Hongri Acron)

Comments:

In the first nine months of 2011, the Group’s commercial output was up 7% year-on-year to 4.366 million tonnes. In Q3 of the current year, the Group performed a number of maintenance overhauls, including one of the nitrogen unit, which affected the Group’s operational results for nitrogen fertilisers. However, this was compensated for by high performance in the first two quarters. In 2011, Dorogobuzh showed steady growth in its operational results, partially due to the fact that the Company did not have any long-lasting overhauls of the nitrogen unit as in 2010.

The Group’s Chinese company Hongri Acron also increased its output due to a favourable situation in the Chinese fertiliser market.

Nitrogen Fertilisers and Ammonia

In 2011, Acron and Dorogobuzh continued to increase their output of nitrogen fertilisers, demand for which remains very high both in the Russian market and in the major export markets (Latin America, North America and Europe). For the first nine months, production of ammonium nitrate, urea and UAN increased a total of 10% year-on-year.

Complex Fertilisers

High demand for complex fertilisers provides maximum load for the Group’s NPK production facilities and allows it to increase dry blends output, showing 64% growth for the nine months of the current year. The Group is extensively developing new markets for its key product – NPK 16:16:16. This year showed significant results in complex fertiliser sales in Thailand and some countries of Latin America.

Organic and Non-organic Compounds

In the reporting year, Acron and Dorogobuzh continued to ramp up production of industrial products. Acron’s organic compounds output was up 13% in the reporting period, including a 20% jump in UFR production in response to significant demand from the Russian wood industry. Higher demand for non-organic compounds allows both companies to increase their output of low-density and technical grade ammonium nitrate, calcium carbonate and liquid carbon dioxide.

Global Fertiliser Market and Prices

The Group continues its dynamic expansion to the highly populated countries of South-East Asia and Latin America. And because the Group has its own logistics and distribution resources, the efficiency of sales on those remote markets is as high as on the Group’s traditional markets.

In general, there is an upswing trend in the global fertiliser market. Actual global demand by agricultural companies provides for both sustainable fertiliser sales and satisfactory prices for producers.

Indicative Global Prices for Mineral Fertilisers (USD per tonne)

Operating Results for Acron, Dorogobuzh and Hongri Acron