K+S Aktiengesellschaft

EANS-News: K+S Aktiengesellschaft
Robust fertilizer business K+S Group confirms outlook for 2012

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quarterly report/Company Information/K+S Aktiengesellschaft


Kassel (euro adhoc) - Kassel, 9 May 2012

Robust fertilizer business
K+S Group confirms outlook for 2012

 - Best first quarter for potash and magnesium products
 - As expected, de-icing salt business significantly below high figures for
   previous year due to weather conditions
 - At EUR 1.44 billion, quarterly revenues 12 % below previous year
 - Operating earnings EBIT I reach EUR 281.1 million in the first quarter
(Q1/11:
   EUR 368.4 million)
 - Adjusted earnings per share at EUR 1.01 (Q1/11: EUR 1.37)
 - Outlook for fiscal year 2012 unchanged: stable revenues and moderate decline
   in operating earnings expected



While the fertilizer business started well in 2012, the de-icing  salt  business
was exceptionally weak due to weather conditions. As expected, this led  to  the
K+S Group not being able to achieve the high figures of the  previous  year  for
revenues and earnings in the first quarter of 2012.

"Despite challenging framework conditions at the start of the year,  our  potash
fertilizer  business  achieved  a  very  good  result",  says  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. "We were  thus  able
to significantly mitigate  the  sharp  decline  for  de-icing  salts  which  was
entirely due to weather conditions. After the demand for fertilizers started  to
recover at the end of the first quarter and should further continue  during  the
course of the year,  we  still  see  good  prospects  and  are  holding  to  the
forecasts for 2012 as a whole. This year too, we should earn a high  premium  on
our cost of capital", Steiner continues.

Rising fertilizer demand at the end of the first quarter
In the wake of the European sovereign debt crisis, the  trade  sector  was  more
cautious in its early stocking-up of fertilizers at the  end  of  2011  and  the
beginning of 2012. Moreover, winterkill damage resulting from very dry and  cold
weather  led  to  a  postponement  of  the  European  spring  season.   However,
throughout the first quarter, the price level  for  agricultural  raw  materials
continued to offer attractive income prospects  for  farmers  and  therefore  an
incentive to increase yields  per  hectare  also  through  the  optimal  use  of
fertilizers. Against this background, at the end of  the  first  quarter,  there
was  an  upturn  in  demand  for  potash  fertilizers,  especially   after   the
contractual negotiations with China for the first half of  2012  were  concluded
with unchanged terms in mid-March. The global market price level  for  potassium
chloride was tangibly higher in the first quarter  of  2012  than  in  the  same
quarter of the previous year.  In  comparison  to  the  average  of  the  fourth
quarter of 2011, prices moderately decreased in  some  regions;  however,  since
the conclusion of the contracts in China, international potash  prices  tend  to
get stronger again.

For nitrogen fertilizers too, in Europe, the first two months of the  year  were
marked by a certain buying restraint, until demand recovered towards the end  of
the first quarter. The prices for nitrogen fertilizers  were  moderately  higher
than the average for the same quarter of the previous year, but  they  decreased
slightly compared to the average for the fourth quarter of 2011 as a  result  of
lower input costs for ammonia.

Unusually weak demand for de-icing salt
As a result of the very mild and partly dry weather conditions at the  beginning
of the year, the demand for de-icing salt in Western Europe was unusually  weak,
particularly compared to the above-average  first  quarter  of  2011,  but  also
compared to the long-term average sales volume. In the first  quarter  of  2012,
the price level was slightly higher than in the same  quarter  of  the  previous
year and was relatively stable compared to the average for  the  fourth  quarter
of 2011.

On the US East Coast, too, the demand for de-icing salt was  very  weak  due  to
the unusually mild winter, and  it  was  below  average  in  the  de-icing  salt
regions of Canada. Most producers responded to high inventories by cutting  back
production. A slight reduction in price was noted particularly on  the  US  East
Coast and in other de-icing salt regions of the USA.

First-quarter revenues below figure for previous year due to weather conditions
Revenues in the first quarter amounted to EUR 1,438.1 million,  a  decrease  of 
EUR
188.8 million or 12 % relative  to  the  figure  for  the  previous  year.  This
decrease is attributable exclusively to lower  revenues  in  the  Salt  business
segment due  to  weather  conditions.  Revenues  in  the  Potash  and  Magnesium
Products business segment were slightly above the figure for the previous  year,
revenues  in  the   Nitrogen   Fertilizers   business   segment   increased   by
approximately 10 %. In the first three months of the  year,  40  %  of  revenues
were generated in the Potash and Magnesium Products business  segment,  followed
by Salt (32 %) and Nitrogen Fertilizers (25  %).  In  Europe,  K+S  generated  a
share in revenues of approximately 50 %,  followed  by  North  America  (25  %),
South America (12 %) and Asia (11 %).

Operating earnings below previous year due to salt business
In the first quarter of 2012, earnings before interest, taxes, depreciation  and
amortisation (EBITDA) fell by 21 % to EUR 337.0 million (Q1/11: EUR 424.9 
million).


In the first quarter of 2012, operating earnings EBIT I reached 
EUR 281.1 million
and were thus EUR 87.3 million (24 %) lower  than  in  the  same  quarter  of 
the
previous year. The Potash and Magnesium Products business segment  was  able  to
further improve its earnings and achieved its best first-quarter  earnings  yet.
By contrast,  in  the  Nitrogen  Fertilizers  business  segment,  earnings  were
slightly lower than the peak figure of the previous year. As  a  result  of  the
weak de-icing salt business, operating earnings of  the  Salt  business  segment
decreased very sharply relative to the extraordinarily good result for the  same
quarter of the previous year.

Adjusted earnings before and after taxes correspondingly lower
In the first quarter, adjusted earnings before  income  taxes  reached  EUR 
266.1
million and were, in line with the development of  operating  earnings,  EUR 
87.1
million or 25 % below the figure for the previous year. Adjusted Group  earnings
decreased in the first quarter by EUR 68.2 million or 26 % to EUR 193.4 million.

Adjusted earnings per share in the first quarter at EUR 1.01 (Q1/11: EUR 1.37)
Adjusted earnings per share in the quarter under review amounted to EUR  1.01 
and
were thus approximately 26 % lower than the figure for the previous  year  of 
EUR
1.37. They were computed on the basis of 191.40  million  no-par  value  shares,
being the average number of shares outstanding  (Q1/11:  191.20  million  no-par
value shares).

Outlook unchanged: Revenues stable, moderate decline in operating earnings
In the financial year 2012, revenues of the K+S Group should  remain  stable  in
comparison to the previous year. While in  the  Potash  and  Magnesium  Products
business segment, on the basis of the currently achieved potash price  level,  a
moderately, and  in  the  Nitrogen  Fertilizers  business  segment,  a  slightly
increasing development of revenues can be assumed, in the Salt business  segment
tangibly (previously: moderately)  lower  revenues  are  expected.  The  revenue
forecast  assumes  an  average  US  dollar  exchange  rate   of   1.33   USD/EUR
(previously: 1.32 USD/EUR); 2011: 1.39 USD/EUR).

In the financial year 2012, operating earnings EBIT I of the  K+S  Group  should
decrease moderately in comparison to last  year's  figure.  In  the  Potash  and
Magnesium Products business segment,  it  is  assumed  that  operating  earnings
could again approach  those  of  the  good  earnings  achieved  last  year.  The
Nitrogen Fertilizers business segment should be able to achieve earnings at  the
level of the previous year. In comparison to last  year,  which  benefited  from
above-average volumes of de-icing salt, operating earnings of the Salt  business
segment will probably decline strongly.

Moderately declining Group earnings expected
The adjusted Group earnings after taxes should also decline moderately  in  2012
in line with the development of operating earnings. This estimate is  based  not
only on the effects described for revenues and operating earnings, but also  on:



    - the expectation of consistently attractive agricultural prices,
    - the customary, purely  technical  forecast  policy,  which  maintains  the
      currently achieved potash price level unchanged for the remainder of 2012,
    - a sales volume in the Potash and Magnesium Products  business  segment  at
      about the same level as in the previous year (2011: 6.9 million tonnes),
    - a sales volume of  crystallised  salt  of  less  than  19  million  tonnes
      (previously: a good 19 million tonnes;  2011:  22.7  million  tonnes),  of
      which less than 10 million tonnes  de-icing  salt  (previously:  about  10
      million tonnes; 2011: 13.3 million tonnes). For the fourth quarter,  this,
      as usual, assumes the average of multi-year de-icing salt sales volumes.
    - a largely unchanged financial result,
    - a slightly higher adjusted Group tax ratio of 27 % to  28  %  (2011:  26.1
      %).
    -

This outlook still includes the Nitrogen business segment,  since  the  sale  of
K+S Nitrogen was announced after the outlook was set up on 2 May 2012.  However,
the sale of K+S Nitrogen does not change the outlook statement: stable  revenues
and moderately decreasing operating earnings can still be expected for the  year
2012 compared to the pro-forma adjusted year 2011.

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 14,000 people. The  K+S  share  -
the commodities stock on the German DAX index - is listed on  all  German  stock
exchanges (ISIN: DE000KSAG888, symbol: SDF). More information about K+S  can  be
found at www.k-plus-s.com.


Note to editors
The Quarterly Financial Report and the K+S Q1/12 Facts & Figures  are  available
at www.k-plus-s.com/2012q1en on our website.

Today's Annual General Meeting of K+S  Aktiengesellschaft  will  be  transmitted
live on the Internet at www.k-plus-s.com/agm starting from  10  a.m.  until  the
end of the speech by the chairman of  the  Board  of  Executive  Directors.  The
speech and presentation will be  available  there  for  download  starting  from
10:00 a.m., as will a video summary 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  are  also  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 10 May 2012 at  3  p.m.  Norbert
Steiner, chairman of the  Board  of  Executive  Directors  and  Joachim  Felker,
member  of  the  Board  of  Executive  Directors,  will   participate   in   it.
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/2012q1en or by phone under  +49-69-71044-5598.  The  conference  is  being
recorded and will also be available as a podcast.

Your contact persons:

Press:  
Michael Wudonig, CFA    

Phone: +49 561 9301-1262        
Fax: +49 561 9301-1666  
michael.wudonig@k-plus-s.com 

Investor Relations:

Christian Herrmann, CFA
Phone: +49 561 9301-1460
Fax: +49 561 9301-2425
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  obligation  to
update the statements contained in this press release.


Further inquiry note:
Press:	
Michael Wudonig, CFA	
Phone: +49 561 9301-1262	
Fax: +49 561 9301-1666	
michael.wudonig@k-plus-s.com	

Investor Relations:
Christian Herrmann, CFA
Phone: +49 561 9301-1460
Fax: +49 561 9301-2425
christian.herrmann@k-plus-s.com

end of announcement                               euro adhoc 
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company:     K+S Aktiengesellschaft
             Bertha-von-Suttner-Straße  7
             D-34131 Kassel
phone:       +49 (0)561 9301-1460
FAX:         +49 (0)561 9301-2425
mail:     christian.herrmann@k-plus-s.com
WWW:      http://www.k-plus-s.com
sector:      Chemicals
ISIN:        DE000KSAG888
indexes:     DAX, Midcap Market Index, CDAX, Classic All Share, HDAX, Prime All
             Share
stockmarkets: regulated dealing: Hannover, Berlin, München, Hamburg, Düsseldorf,
             Stuttgart, regulated dealing/prime standard: Frankfurt 
language:   English
 



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