OJSC PhosAgro (PHOR) PhosAgro to Discuss Key Areas of Growth Strategy to 2025 and Present New Dividend Policy at Capital Markets Day 25-Sep-2019 / 13:00 CET/CEST Dissemination of a Regulatory Announcement, transmitted by EQS Group. The issuer / publisher is solely responsible for the content of this announcement.
PhosAgro to Discuss Key Areas of Growth Strategy to 2025 and Present New Dividend Policy at Capital Markets Day
Key Highlights of PhosAgro's strategy to 2020 adopted in 2013:
As part of its strategy to 2025, PhosAgro aims to accomplish the following:
London - 25 September 2019. At today's Capital Markets Day in London, the top management and independent members of the Board of Directors of PhosAgro ("the Company", "the Group", Moscow exchange, LSE: PHOR), one of the world's leading producers of phosphate-based fertilizers, will present the Company's new development strategy to 2025, including its key priorities and long-term goals, and will discuss the new dividend policy.
Andrey Guryev, PhosAgro's CEO and a member of the Company's Board of Directors, said: "The strategy to 2025 aims to further expand PhosAgro's presence in its priority domestic market, as well as in premium export markets that offer the best netback prices. Compared to 2018 levels, we plan to grow the Company's fertilizer sales volumes by 50% in Russia and by 60% in Europe by 2025. The share of direct export sales will be maintained at a level of at least 90% with the help of PhosAgro's 10 existing foreign trading offices located in the Company's key sales regions.
"An additional competitive advantage that will increase PhosAgro's share in priority markets along with its market premium will be the environmental safety of fertilizers to human and soil health. These safety standards are being implemented as part of new EU regulations on the sale of fertilizers with high amounts of cadmium and other heavy metals. Starting this year, in accordance with EU legislation, PhosAgro fertilizers will be sold with green labelling. In addition, PhosAgro's fertilizers - along with agricultural products - will be included in Russia's brand of products offering improved environmental performance.
"We also hope that foreign regulators will remove trade restrictions - import duties and customs ratios - for the cleanest fertilizers from Russia. Farmers will benefit from this in terms of both price and the absence of a risk of soil contamination, and the Company could potentially earn up to an additional USD 100 million depending on market conditions. The authorities in Argentina and Brazil recently abolished import duties on environmentally friendly phosphate-based fertilizers from Russia.
"An important component of the new strategy is the construction of a new plant in the Leningrad region with a capacity of 630 thousand tonnes, as well as the modernisation of production facilities in the Saratov region. These initiatives will make it possible to produce NPK(S) fertilizers with an expansion of total fertilizer production from an expected 2.2 million tonnes in 2019 to 3.3 million tonnes in 2022, in addition to increasing PhosAgro's share in the domestic market supply from 34% to 60%.
"It should be noted that PhosAgro already passed the peak of its investment cycle following completion of its key capital-intensive project under the strategy to 2020, namely the construction of high-tech ammonia and granulated urea facilities. Investments in the further development of efficient, flexible and high-tech production facilities at existing production sites using BATs - including cutting-edge technologies from one of the world's leading R&D institutes for the fertilizer sector, the Y. Samoilov Research Institute of Fertilizers and Insectofungicides - as well as the adoption of digital and innovative solutions, will be implemented only in projects for which the IRR exceeds the threshold of 20%.
"The Company will focus on expanding the capacity of its own railway and port infrastructure, as well as increasing and upgrading its fleet of railcars to reduce transportation costs.
"One of the key elements of the Company's new strategy is the commitment to the UN Sustainable Development Goals, the implementation of which is overseen by the Sustainability Committee of the PhosAgro Board of Directors, headed by former UNESCO Director-General Irina Bokova.
"Along with the implementation of investment programmes to ensure a stable future cash flow, the Company will continue to pay competitive dividends in a balanced manner, as well as implement charitable and social programmes aimed at training highly professional engineering personnel and supporting education, corporate housing, healthcare, youth policy and athletic initiatives."
For further information please contact: PhosAgro Andrey Serov, Head of Investor Relations Department +7 495 232 9689 ext 2183 firstname.lastname@example.org Timur Belov, Press Officer +7 495 232 9689 EM Sam VanDerlip email@example.com +44 7554 993 032 +7 499 918 3134
+7 495 363 2849
+7 916 770 89 09
About the Company
PhosAgro is one of the world's leading vertically integrated phosphate-based fertilizer producers in terms of production volumes of phosphate-based fertilizers and high-grade phosphate rock with a P2O5 content of 39% and higher. PhosAgro's pure phosphate-based fertilizers stand out for their high efficiency and their environmental safety for the health of people and soils.
The Company is the largest phosphate-based fertilizer producer in Europe (by total combined capacity for DAP/MAP/NP/NPK/NPS), the largest producer of high-grade phosphate rock with a P2O5 content of 39%, a top-three producer of MAP/DAP globally, one of the leading producers of feed phosphates (MCP) in Europe, and the only producer in Russia, and Russia's only producer of nepheline concentrate (according to the RAFP).
PhosAgro's main products include phosphate rock, 39 grades of fertilizers, feed phosphates, ammonia, and sodium tripolyphosphate, which are used by customers in 100 countries spanning all of the world's inhabited continents. The Company's priority markets outside of Russia and the CIS are Latin America, Europe and Asia.
PhosAgro's shares are traded on the Moscow Exchange, and Global Depositary Receipts (GDRs) for shares trade on the London Stock Exchange (under the ticker PHOR). Since 1 June 2016, the Company's GDRs have been included in the MSCI Russia and MSCI Emerging Markets indexes.
More information about PhosAgro can be found on the website: www.phosagro.ru.
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