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EANS-News: K+S Aktiengesellschaft
K+S Group stays on course
Significant growth in revenues and earnings in 2011 - Continued attractive
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The issuer/originator is solely responsible for the content of this announcement. -------------------------------------------------------------------------------- Annual Reports/annual result/Company Information/K+S Aktiengesellschaft Kassel (euro adhoc) - Kassel, 15 March 2012 K+S Group stays on course Significant growth in revenues and earnings in 2011 - Continued attractive prospects Financial Year 2011 - High demand for fertilizers and strong salt business once again - Revenues rise by 11% to EUR 5.2 billion - Operating earnings EBIT I reach EUR 976 million (+37%), the second-best result in the history of the Company - Adjusted earnings per share from continued operations improve, reaching EUR 3.52 (+49%) - Adjusted earnings per share at EUR 3.04 (+30%) - Dividend proposal raised significantly: EUR 1.30/share (2010: EUR 1.00) Q4/2011 - Fertilizers: More cautious management of early stocking-up by trade sector; Salt result under record level of 2010 due to weather conditions - Revenues at EUR 1.30 billion (Q4/2010: EUR 1.29 billion) - Operating earnings EBIT I increase by 9% to EUR 216.9 million - Adjusted earnings per share from continued operations at EUR 0.80 per share (Q4/2010: EUR 0.78) Attractive prospects for the two coming years - Outlook for 2012: Revenues stable and earnings moderately decreasing due to mild winter - Promising outlook for 2013: Revenues should rise slightly, operating earnings will probably increase moderately The K+S Group looks back at 2011 as a year that was very successful. "Despite the general uncertainty connected with the sovereign debt crisis in Europe, in the past financial year, we managed to achieve the second-best result so far in the Company's history", says Norbert Steiner, Chairman of the Board of Executive Directors of K+S Aktiengesellschaft on the occasion of the Company´s financial report press conference. High demand for fertilizers The fertilizer business was characterised by strong demand particularly in the first nine months, before a more cautious management of early stocking-up by the trade sector emerged in the fourth quarter. The prices of important agricultural products were at a consistently attractive level in the course of the year, which offered a significant incentive for farmers worldwide to increase the yield per hectare by using more fertilizer. Salt business achieves record level of previous year In the Salt business sector, the wintry weather conditions in the first quarter of 2011 both in North America and Europe resulted in very high demand. It thus proved possible to again achieve the record sales volumes of the previous year despite the mild winter in the fourth quarter. The salt business in 2011 was thus again above average. Revenues increase by 11% to EUR 5.2 billion In financial year 2011, the K+S Group achieved revenues of EUR 5,150.9 million, which was 11% above the figure for the previous year. The increase in revenues is particularly attributable to positive price effects, which were able to more than make up for the slightly negative currency and volume effects. While the Potash and Magnesium Products and Nitrogen Fertilizers business segments posted significant revenue growth, the Salt business segment was able to maintain revenues almost at the high level of the previous year. In Europe, revenues of EUR 2.6 billion (+11%) were achieved. This region therefore accounted for half of total revenues. North America achieved a share in revenues of 23% and South America one of 12%, while Asia accounted for 11% of total revenues. Operating earnings up significantly During the year under review, earnings before interest, taxes, depreciation and amortisation (EBITDA) rose by 28% to EUR 1,217.7 million (2010: EUR 953.0 million). The increase was, in particular, due to the significant improvements in earnings in the Potash and Magnesium Products and Nitrogen Fertilizers business segments. At 23.6%, the EBITDA margin also reached a very pleasing level (2010: 20.6%). The key control variable of the K+S Group, operating earnings EBIT I, increased by EUR 261.2 million or 37% to EUR 975.7 million (2010: EUR 714.5 million). At 18.9%, the EBIT margin also reached a very good level (2010: 15.4%). The Potash and Magnesium Products and Nitrogen Fertilizers business segments increased their earnings above all due to fertilizer prices rising over the year. The earnings of the Salt business segment were below the figure for the previous year, since although the de-icing salt business was above average, due to a different regional mix it did not achieve the record level of the previous year. Adjusted earnings before and after taxes also strongly improved Adjusted earnings before incomes taxes were EUR 911.8 million and thus rose by EUR 317.3 million or 53% in comparison to the previous year's figure. At EUR 673.6 million, the adjusted Group earnings from continued operations were EUR 219.8 million or about 50% above the previous year´s level (2010: EUR 453.8 million). The main reasons for this were the sharply increased operating earnings and a significantly improved financial result. For the year under review, adjusted earnings per share from continued operations amounted to EUR 3.52 - an increase of about 50% over the previous year´s figure of EUR 2.37. Adjusted earnings per share including discontinued operations reached EUR 3.04 (2010: EUR 2.33). 4th quarter of 2011: Higher earnings despite subdued environment The consequences of the sovereign debt crisis became noticeable also in the fertilizer business towards the end of the year. With the 2008/2009 financial crisis still fresh in mind, the trade sector felt uncertain at the end of the year and, for the time being, postponed the customary early stocking-up of fertilizers. In the West European de-icing salt business, the early stocking-up, which extended even into the fourth quarter, resulted in an overall satisfactory start to the winter season 2011/2012 despite the relatively mild weather. However, in the United States and in Canada too, the season began below average due to the also rather mild weather. At EUR 1,300.2 million, revenues of the K+S Group in the fourth quarter of 2011 were somewhat higher than the figure for the previous year (EUR 1,285.3 million). During the fourth quarter, earnings before interest, taxes, depreciation and amortisation (EBITDA) rose by about 11% to EUR 290.8 million (previous year: EUR 261.4 million). Operating earnings EBIT I improved in the fourth quarter by about 9% to EUR 216.9 million (previous year: EUR 198.6 million). The price-related increase in earnings in the Potash and Magnesium Products business segment managed to more than make up for the significant decrease in earnings in the Salt business segment. Adjusted Group earnings from continued operations rose in the fourth quarter by 3% to EUR 153.3 million (Q4/2010: EUR 148.8 million) after the previous year´s quarter had benefited from a low tax ratio. Board of Executive Directors and Supervisory Board propose dividend of EUR 1.30 per share The Board of Executive Directors and the Supervisory Board will propose to the Annual General Meeting that the dividend for the past financial year should be raised in accordance with the significantly increased earnings, and EUR 1.30 per share be paid (2010 dividend: EUR 1.00). This would correspond to a dividend pay- out ratio of about 43%. K+S Group with attractive prospects K+S´s Chairman of the Board of Executive Directors, Norbert Steiner, on the expected course of business: "Despite all the macroeconomic uncertainties, 2012 should nevertheless be another good year for the K+S Group. The current pricing level for agricultural raw materials offers attractive income prospects for farmers and should therefore lead to a positive development in fertilizers demand in those sales regions of relevance for us. However, for the Salt business, due to the weather-related unusually poor start to the de-icing business, we are anticipating significantly lower volumes of business compared to the above-average performance in 2011. In sum, K+S Group revenues will probably remain stable for 2012, while operating earnings and adjusted earnings after taxes should, however, decrease moderately due primarily to the muted demand for de-icing salt. Nonetheless, without the impact of last year´s disposal of the COMPO business, there is a good chance for an at least stable dividend for the year 2012." In 2013, revenues of the K+S Group should increase slightly in comparison to 2012. Owing to the high profitability of the Potash and Magnesium Products business segment and on the basis of an again assumed normal winter business in line with the long-term average historical volumes of de-icing salt, there are realistic opportunities of a moderate increase in operating earnings in comparison to 2012. This should also positively impact the adjusted Group earnings after taxes. A raising of the dividend is therefore possible. (Further details of the outlook in the Financial Report 2011, page 135 et seqq.). 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 Financial Report 2011, the Corporate and Sustainability Report 2011 as well as the K+S Q4/11 Facts & Figures can be downloaded by clicking the following link on our website: www.k-plus-s.com/2011q4en. In addition, you will find a video message on business developments from Norbert Steiner, Chairman of the Board of Executive Directors, and from 10 a.m., today´s presentations of Norbert Steiner and Joachim Felker, member of the Board of Executive Directors, on K+S´s financial report press conference in Frankfurt am Main. An analysts´ conference in English will take place today at 1 p.m., in Frankfurt am Main as well. Norbert Steiner and Joachim Felker will attend. Shareholders, investors, representatives of the press and all other interested parties are invited to follow the conference via a live webcast at (www.k-plus- s.com/en/audio-und-video/cc.html) or via telephone (+49-69-6677-75757; PIN 3564773#). The conference is being recorded and will also be available as a podcast. Your contact persons: Press: Michael Wudonig, CFA Telefon: +49 561 9301-1262 Fax: +49 561 9301-1666 firstname.lastname@example.org Investor Relations: Christian Herrmann, CFA Telefon: +49 561 9301-1460 Fax: +49 561 9301-2425 email@example.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 Telefon: +49 561 9301-1262 Fax: +49 561 9301-1666 firstname.lastname@example.org Investor Relations: Christian Herrmann, CFA Telefon: +49 561 9301-1460 Fax: +49 561 9301-2425 email@example.com end of announcement euro adhoc -------------------------------------------------------------------------------- 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: firstname.lastname@example.org 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: official dealing: Hannover, Berlin, Hamburg, regulated dealing: München, Stuttgart, official dealing/prime standard: Frankfurt language: English