Eurochem, AK

OJSC MHC EuroChem is the largest producer of mineral fertilizers in Russia. In terms of production volume, EuroChem is one of the three European and ten world producers of chemical fertilizers. The company's goal for the next five years is to become one of the five world leaders in the industry in terms of production and profit. At the same time, EuroChem intends to keep competitive prices for its products by reducing costs and deepening vertical integration.

Performance indicators

2023: Decrease in revenue to 363 billion rubles and profit to 111.9 billion rubles

In 2023, EuroChem gained 363 billion rubles (-8% compared to 2022) and earned 111.9 billion rubles of net profit (-37%). This was reported in the company's statements, IFRS which were published in early April 2024.

According to the head of Eurochem Oleg Shiryaev, the main reason for the reduction in financial indicators was the fall in prices for mineral fertilizers due to lower demand and high warehouse stocks.

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According to Interfax, citing EuroChem materials, in the second half of 2023, the company improved its results and reached approximately the second half of 2022 in terms of revenue and net profit. By the end of 2023, the group's total debt reached 456.3 billion rubles with a net debt of 440 billion rubles.

In 2023, EuroChem's gross profit amounted to 162.65 billion rubles, which is 24% less than a year earlier. Operating profit decreased by 37% (to 93.12 billion rubles), profit before tax - by 40% (to 120.9 billion rubles).

As of December 31, 2023, EuroChem combines enterprises for the production of phosphate raw materials Russia in (Kovdorsky GOK) and, Kazakhstan two potash mines - "" and Usolskiy potash plant"," VolgaKaliy plants for the production of ammonia and fertilizers in Russia ("," Nevinnomyssky nitrogen"," Novomoskovskiy nitrogen"," Phosphorite"EuroChem - Belorechenskiy Minudobrenii," "EuroChem-North-West"), as well as enterprises in, and Belgium. To Lithuania China

By the end of 2023, the group's assets reached 1.08 trillion rubles against 983.53 billion rubles a year earlier. Non-current assets of the company by the end of 2023 amounted to 728.55 billion rubles. Current assets in 2023 decreased by a third compared to 2022 - to 348.82 billion rubles. The group's capital and reserves increased by 11.1%, to 512.57 billion rubles.^[1]

2022: Increase in annual revenue by 6 times to 51.7 billion rubles

The revenue of MHC EuroChem, on which the Russian assets of the EuroChem group were consolidated, reached 51.7 billion rubles in 2022, which is 6 times more than a year earlier. The net profit of the holding during this time rose 2.5 times and amounted to 107 billion rubles. This is stated in the statements that the company disclosed in April 2023.

According to Interfax, citing materials from the EuroChem MHC, by the end of 2022, the company's total debt had grown 1.9 times and amounted to 390.6 billion rubles. Last year, the Swiss parent structure of the group - Eurochem Group AG - transferred obligations to banks to EuroChem MHC for 24.8 billion rubles due in 2024.

EuroChem has increased its annual revenue 6 times

EuroChem's RAS reporting does not reflect group-wide performance. EuroChem has not disclosed its consolidated statements for more than a year. However, the financial results of most of the group's Russian enterprises for 2022 are published. From their analysis it follows that EuroChem in 2022 significantly increased revenues from the potash business, the news agency notes.

Thus, the revenue of the Usolsky Potash Plant (Perm Territory) increased 2.3 times and reached 116.3 billion rubles. The share of the company's export revenue remained at the level of 2021 - 89%. Gross profit increased 2.6 times, to 102.3 billion rubles, net profit - more than 3 times, to 93.6 billion rubles.

Volgakalia's revenue grew almost 5 times, to 4.9 billion rubles, the share of export revenue amounted to 99% against 96% in 2021. The gross profit of the enterprise reached 10.4 billion rubles against 1.9 billion rubles a year earlier. In 2022, Volgakaliy made a profit (9.7 billion rubles).

Revenue of EuroChem-North-West (operator of the ammonia plant in Kingisepp) decreased by 5%, to 28.2 billion rubles. The share of export revenue decreased to 55% against 84% a year earlier. The gross profit of the plant amounted to 20.2 billion rubles, net profit - 17.8 billion rubles (indicators remained at the level of 2021).^[2]

History

2024: Phosphate fertilizer plant launched in Brazil

The largest Russian producer of mineral fertilizers "EuroChem" on March 13, 2024 put into operation a new enterprise for the production of phosphate fertilizers. The launch took place in Brazil, in the city of Serra do Salitri.

According to Kommersant, the plant's capacity will be 1 million tons, which increases the total capacity of the group's enterprises for the production of phosphate fertilizers to 6 million tons per year. The volume of investments in the new project is estimated at $1 billion.

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Previously, the plant was owned by the Norwegian company Yara and was half built. In February 2022, it was bought by the EuroChem group. In addition, the asset includes an open pit mine for the extraction of phosphate raw materials. The transaction amount at that time amounted to $452 million.

This is the third asset of the group in South America. EuroChem already owns Fertilizantes Tocantins, a fertilizer blending and distribution company (acquired by the group in 2020), as well as Fertilizantes Heringer, a distributor (purchased in 2022). In general, EuroChem is the fourth largest player in the fertilizer market in Brazil, and the total capacity of the group's enterprises is 4 million tons of fertilizers per year.

Oleg Shiryaev, CEO of EuroChem, called South America the group's largest growing market, where there is a high demand for the company's products. An important factor is that EuroChem controls the entire chain from the extraction of raw materials to the delivery of fertilizers to the end user. Shiryaev called it a principle "from mine to farm."

Brazil is the world's fourth largest fertilizer import market. In 2023, fertilizer supplies to Brazil reached 45.8 million tons, with a domestic capacity of 6.8 million tons.^[3]

2023

Preservation of the plant in Lithuania

In early July 2023, it became known about the decision of Eurochem to mothball the Lifosa phosphate mineral fertilizer plant in Lithuania. According to the chairman of the board of directors of the holding Samir Briho, the reason for this step was the impossibility for the enterprise "to work steadily in an environment with so many restrictions." Read more here.

Owners and beneficiaries of Eurochem

According to the representative of the press secretary Andrei Melnichenko, as of June 2023, Eurochem owns AIM Capital, almost 100% of which belongs to the Cypriot company Linea. In turn, 75.1% of Linea, according to the source, is owned by the Firstline Trust, the beneficiary of which is Alexandra Melnichenko (without control and ownership). The source declined to provide information on the full number of Firstline Trust beneficiaries at the request of TAdviser, citing confidentiality.

2022

Andrey Melnichenko falls under sanctions and gives his wife 90% of Eurochem Group

Billionaire ​Andrey Melnichenko handed over to his wife 90% of the Eurochem Group AG holding, located in Zug, Switzerland. The accounts of Swiss companies Melnichenko, who fell under sanctions with the start of Russia's special operation in Ukraine, were frozen by UBS and Credit Suisse after March 9, and Citigroup began blocking payments from companies on loans, writes Tagesanzeiger.

But on March 10, Eurochem Group AG published a message that since March 9, Andrei Melnichenko has ceased to be the owner. And on March 30, the Secretary of State for Economics Switzerland unblocked the holding's bank accounts.

Shutdown of production at a plant in Lithuania due to the ban on the supply of raw materials from Russia

Logo in 2017

In April 2022, the Lithuanian phosphorus fertilizer plant Lifosa, a subsidiary of Eurochem, stopped production amid a special operation Russia on To Ukraine and the sanctions that followed. EU The plant switched to temporary preservation of equipment. It is expected to be launched in May, when the issue of the supply of raw materials not from Russia can be resolved. Belarus

2011: CNews interview with Chief information officer Vladimir Chibisov

• Eurochem: We have completely moved to the virtual space

Notes