K+S Aktiengesellschaft

EANS-News: K+S Group
Quarterly figures up significantly on previous year Very successful start for K+S into the financial year 2011

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Annual Reports/quarterly report/K+S group

Kassel (euro adhoc) - Kassel, 11 May 2011

Quarterly figures up significantly on previous year Very successful start for K+S into the financial year 2011

•       Very good start to the year for fertilizer and salt businesses
•       First quarter revenues rose by 16% to EUR 1.8 billion
•       Operating earnings (EBIT I) reach EUR 384.3 million (+44%)
•       Adjusted earnings per share at EUR 1.42 (Q1/10: EUR 0.92)
•       Outlook for 2011 raised: Significant rise in revenues and strong rise in
earnings expected


The K+S Group enjoyed a successful start to financial year 2011. Strong demand
for fertilizers and an above-average de-icing salt business were mainly
responsible for the positive course of business in the first quarter.

"We had a successful start into the new financial year," said Norbert Steiner,
chairman of the Board of Executive Directors of K+S Aktiengesellschaft on the
occasion of the Company´s Annual General Meeting in Kassel. "This allows us to
look towards the coming quarters with confidence," Steiner continued. 

Strong demand for fertilizers in first quarter of 2011 After what was largely a normalisation of demand for fertilizers in 2010, the first quarter of 2011 was characterised by strong demand. The currently high level of agricultural prices favoured the income prospects of the agricultural sector, so that there was a significant incentive to raise yields per hectare through the increased use of fertilizers. For both potash and magnesium products and nitrogen fertilizers, this resulted in a very high utilisation of respective production capacities throughout the world. This environment also favoured the price development for potassium chloride.

High demand for de-icing salt once again In the Salt business segment, the wintry weather conditions on the East Coast of the United States and in Europe triggered above-average demand for de-icing salt. While the European market for industrial salt was characterised by a positive demand trend overall, the business in South and North America was largely stable. The demand for food grade salt proved to be in good shape in the first quarter both in Europe and North America. In South America the situation on this market normalised. As regards salt for chemical use, demand in Europe and South America was stable, while it rose in the North American market.

First quarter 2011 revenues up significantly on previous year In the first quarter, the revenues of the K+S Group rose by about 16% to EUR 1,776.5 million on the figure for the same period last year. This increase was mainly attributable to price and volume factors. The Potash and Magnesium Products and Nitrogen Fertilizers business segments achieved strong revenue increases, after the prices for fertilizers increased in comparison to the same quarter last year. The Salt business segment managed to significantly increase its revenues due to volume and price factors. In the first three months of the year, 38% of Group revenues were generated in the Salt business segment, followed by Potash and Magnesium Products (32%) and Nitrogen Fertilizers (27%). Regionally, the distribution of revenues is almost balanced between Europe and overseas. Thus, 51% of the total revenues was generated in Europe and 49% overseas.

Operating earnings have risen strongly Earnings before interest, taxes, depreciation and amortisation (EBITDA) of the first quarter of 2011 rose by 33% to EUR 443.1 million, while operating earnings (EBIT I) reached EUR 384.3 million and were increased by EUR 116.6 million or about 44% in comparison to the same quarter of the previous year. At EUR 58.8 million, depreciation and amortisation taken into account in EBIT I decreased by EUR 6.6 million in comparison to the previous year´s figure, which had been adversely affected by special depreciation. All business segments managed to achieve an improvement year on year. While the Potash and Magnesium Products and Nitrogen Fertilizers business segments were able to increase their earnings due to fertilizer prices that were higher than in the same quarter of the previous year, in the Salt business segment it was primarily the disappearance of one-time effects charged to earnings that produced significantly higher earnings after the already very strong same quarter of the previous year.

Adjusted earnings also increase strongly In the quarter under review, adjusted earnings before income taxes totalled EUR 368.4 million (Q1/10: EUR 237.5 million). In the first quarter, adjusted Group earnings after taxes amounted to EUR 272.0 million (Q1/10: EUR 175.8 million). For the quarter under review, adjusted earnings per share amounted to EUR 1.42 and were thus about 55% higher than the figure for the previous year of EUR 0.92.

Revenues and earnings outlooks for 2011 raised Against the backdrop of the positive demand and price trends emerging during the course of the first quarter of 2011, the revenues of the K+S Group should rise significantly (previously: tangibly) in financial year 2011 against the previous year. While in the Potash and Magnesium Products business segment K+S is assuming a significant (previously: tangible) increase in revenues and in the Nitrogen Fertilizers business segment also a significant one, in the Salt business segment stable revenues at a high level are expected. In financial year 2011, earnings before interest, taxes, depreciation and amortisation (EBITDA) and operating earnings EBIT I of the K+S Group should increase strongly (previously: significantly) in comparison to the figures for the previous year. This is primarily due to a probably strong (previously: significant) growth in earnings in the Potash and Magnesium Products business segment as well as a tangible (previously: moderate) improvement in operating earnings in the Nitrogen Fertilizers business segment. However, the operating earnings of the Salt business segment will probably decline moderately. The forecast is based on the following assumptions:

•       continued attractive agricultural prices;
•       in comparison to the previous year higher average proceeds and stable
sales volumes in the Potash and Magnesium Products business segment (expected
sales volume: about 7 million tonnes);
•       22 to 23 million tonnes of crystallised salt sales volumes in the Salt
business segment, of which 13 to 14 million tonnes should be accounted for by
de-icing salt. For the fourth quarter, this, as customary, assumes the average
of multi-year de-icing salt sales volumes;
•       an average US dollar exchange rate of 1.40 USD/EUR (previously: 1.35
USD/EUR ) in 2011;
•       significantly rising energy costs in 2011 on the basis of an oil price
level of about US$ 120 (previously: US$ 90) per barrel;
•       a significantly better financial result, after this had been negatively
impacted by special effects in 2010;
•       a domestic Group tax rate of 28.3% and an adjusted Group tax ratio of
about 26 to 27% (2010: 26.2%). 

Experience growth The K+S Group is one of the world's leading suppliers of standard and speciality fertilizers. In the salt business, K+S is the world´s leading producer with sites in Europe as well as North and South America. K+S offers a comprehensive range of goods and services for agriculture, industry, and private consumers which provides growth opportunities in virtually every sphere of daily life. The K+S Group employs more than 15,000 people. The K+S share - the commodities stock on the German DAX index - is listed on all German stock exchanges (ISIN: DE0007162000, symbol: SDF). More information about K+S can be found at www.k-plus-s.com.

Note to editors The quarterly financial report and a video webcast by Norbert Steiner, Chairman of the Board of Executive Directors of K+S Aktiengesellschaft, for the 1st quarter of 2011 are available at www.k-plus-s.com/2011q1en

Today´s Annual General Meeting of K+S Aktiengesellschaft will be transmitted on the Internet at www.k-plus-s.com/agm starting from 10:00 a.m. until the end of the speech by the Chairman of the Board of Executive Directors. The speech and the presentation will be available there for download starting from 10:15 a.m., as will a video montage of the speech by the Chairman of the Board of Executive Directors starting from about 2 p.m.

Current image material relating to the K+S Group can be downloaded from our website. Photos of today´s Annual General Meeting will also be available on the Internet at www.k-plus-s.com/agm starting from about 11 a.m.

A conference call in English will take place on 12 May 2011 at 3 p.m. Representatives of the press, shareholders, investors and all other interested parties are invited to follow the conference via a live webcast at www.k-plus-s.com. The conference is being recorded and will also be available as a podcast.

Your contact persons:

Press: Investor Relations:

Michael Wudonig, CFA                Christian Herrmann, CFA
Tel: +49 561 9301-1262              Tel: +49 561 9301-1460
Fax: +49 561 9301-1666              Fax: +49 561 9301-2425
michael.wudonig@k-plus-s.com  christian.herrmann@k-plus-s.com



Forward-looking statements 

This press release contains facts and forecasts that relate to the future development of the K+S Group and its companies. The forecasts are estimates that we have made on the basis of all the information available to us at this moment in time. Should the assumptions underlying these forecasts prove not to be correct or risks arise - examples of which are mentioned in the risk report - actual developments and events may deviate from current expectations. Outside statutory disclosure provisions, the Company does not take any obligations to update the statements contained in this press release.

end of announcement                               euro adhoc
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Contact:

Your contact persons:

Press: Investor Relations:
Michael Wudonig, CFA Christian Herrmann, CFA
Tel: +49 561 9301-1262 Tel: +49 561 9301-1460
Fax: +49 561 9301-1666 Fax: +49 561 9301-2425
michael.wudonig@k-plus-s.com christian.herrmann@k-plus-s.com

Branche: Chemicals
ISIN: DE0007162000
WKN: 716200
Index: DAX, Midcap Market Index, CDAX, Classic All Share, HDAX,
Prime All Share
Börsen: Frankfurt / regulated dealing/prime standard
Berlin / regulated dealing
Hamburg / regulated dealing
Stuttgart / regulated dealing
Düsseldorf / regulated dealing
Hannover / regulated dealing
München / regulated dealing



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