Azoty chemicals finalises work on target model for group's operations

Listed chemical group Azoty is finalising work on a target model for the group's operations, the company said in a press release. The most important assumptions will be presented in the coming weeks.

"We are currently finalising work on the target model for the functioning of Azoty and will present its most important assumptions in the coming weeks," Azoty's deputy CEO Andrzej Skolmowski, quoted in the release, said.

"Regardless of the ongoing activities, we are observing increasing imports of cheap fertilisers from Russia and Belarus, which is becoming an increasing challenge in our key Agro segment," he added.

The CEO said that the scale of imports and their negative impact on the competitiveness of European producers, make this an issue that requires support at the EU regulatory level.

Skolmowski said that since the end of March, corrective measures have been implemented to stabilise the group's financial situation.

"We closed the first half of the year with an improvement in financial performance and an increase in sales performance of more than 700,000 tonnes compared to the same period last year," he said.

As the deputy CEO pointed out, this is the result of, among other things, projects to improve the efficiency of the group's businesses.

"Over the past few months, we have implemented specific cost optimisations across the group - by the end of June, we had reduced fixed costs by more than PLN 200 million compared to the previous management's plan," he added.

Azoty Group's consolidated sales revenue in the second quarter of 2024 stood at PLN 3.344 billion (EUR 780 mln). The Group generated an EBITDA loss of PLN 128 million (EUR 29.9 mln), with an EBITDA margin of minus 3.8 percent against an EBITDA loss of 608 million (EUR 141.8 mln) and an EBITDA margin of minus 17.4 percent in the second quarter of 2023.

In the first half of 2024, the Group generated consolidated sales revenues of PLN 6.743 billion (EUR 1.572 bln) and an EBITDA loss of 179 million (EUR 41.8 mln), with an EBITDA margin of minus 2.7 percent, which improved by nearly PLN 830 million (EUR 193.6 mln) compared to the same period last year.

The net loss for the first half of 2024 amounted to PLN 748 million (EUR 174.5 mln) and was lower compared to the loss reported in the first half of 2023, which amounted to PLN 1.098 billion (EUR 256 mln).

gaw/ han/