OCP continues to show sustained operational efficiency and is performing well in the first quarter of the year. All aggregates increased at the end of March. This performance supports the Group’s positioning as a world leader in the fertilizer market. In the first three months of 2019, the group achieved a clear improvement in sales.
Double-digit growth was noted at this level. The volume rose in one year from 10.41 billion dirhams to 12.52 billion dirhams at the end of March 2019 marking a rise of 20% compared to the first quarter of the previous year.
Commenting on this performance, OCP notes two factors. In fact, we are talking about the increase in the volumes of acid and fertilizer exported as well as the increase in prices in the three segments, namely rock, acid and fertilizer.
Which, according to the group, largely offset the slight decline in rock export volumes. “OCP’s first-quarter revenue growth was widespread, driven by higher volumes and improved pricing compared to the first quarter of last year, although prices have fallen significantly on a sequential basis,” the Group stresses in a quarterly earnings communication.
In terms of gross margin, it benefited from significantly higher sales and an optimized product mix. OCP notes in this sense an improvement of 42% thus reaching 9 billion dirham against 6.35 billion dirhams a year earlier.
With regard to commodity prices, the Group indicates that they have remained relatively stable for sulfur and declining for ammonia. It should be noted that the operational efficiency of the Group, the increase in volumes and the “greater” selling prices observed over the period contributed to the strengthening of its EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization). It has indeed appreciated by 73% compared to the first three months of last year to be around 4.36 billion dirhams at the end of March 2019.
A consolidation that generated an EBITDA margin of 35%. “Ebitda’s margin continued to benefit from the company’s industrial flexibility across the entire value chain, which helped optimize the product mix, and the Group’s business agility positions OCP as a key exporter. on the main consuming continents”, we learn from the Group. Operating income also recovered during the quarter, reaching a value of 2.53 billion dirhams at the end of March.
Investment expenditures reached 2.25 billion dirhams against 2.91 billion dirhams a year earlier.