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Investing.com -- Shares of Yara International ASA (OTC:YARIY) (OSLO:YAR) climbed 5% today following the company’s release of its first-quarter financial results, which surpassed both Jefferies’ and consensus estimates. The robust performance was primarily driven by higher sales and EBITDA across multiple regions.
The company reported group sales of $3,648 million, exceeding the consensus projection of $3,464 million and Jefferies’ forecast of $3,141 million. This represents a significant increase from the previous year, with total deliveries up 7% year-over-year (YoY), largely fueled by demand in Europe and Brazil.
Yara’s EBITDA before special items reached $638 million, a 6% improvement over Jefferies’ estimate of $604 million and a substantial 23% above the consensus of $518 million. The EBITDA margin also saw a notable expansion, up 440 basis points YoY.
Breaking down the performance by region, Europe stood out with sales of $1,388 million and an EBITDA of $159 million, marking an impressive 468% YoY growth. European deliveries increased by 15% YoY, with a significant uptick in NPK and nitrates sales. In the Americas, sales amounted to $1,041 million, with EBITDA rising by 8% YoY to $155 million, supported by a 12% YoY increase in deliveries, particularly of NPKs in Brazil.
However, not all regions experienced growth. Africa and Asia sales were $709 million, with a 26% YoY increase in EBITDA to $87 million, despite a 3% decline in deliveries due to an outage in India and divestment activities. The Global Plants and Operational segment saw a decrease, with EBITDA falling 22% YoY to $96 million, attributed to lower ammonia production and portfolio changes.
The newly highlighted Clean Ammonia segment demonstrated strong performance with sales of $545 million and a 58% YoY increase in EBITDA to $41 million, bolstered by higher volumes and margins. Industrial Solutions also reported positive results, with EBITDA up 60% YoY to $93 million, despite a slight 1% dip in deliveries.
From a financial standpoint, Yara’s operating cash flow in the first quarter stood at $329 million, a significant improvement from $58 million in the same period last year, mainly due to stronger operating income and a smaller increase in trade receivables. The company’s net interest-bearing debt was reported at $3,454 million, equating to 1.7 times ND/EBITDA.
Jefferies analysts commented on the results, stating, "We expect a positive share price response." This aligns with the market’s reaction to the earnings release, which has seen Yara’s stock rise significantly during the trading session.
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