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Tringen profits down 58%
Point Lisas-based ammonia producer Trinidad Nitrogen Company Ltd (Tringen) on Thursday reported a 58 per cent decline in its profit after tax for the year ended December 31, 2016, with its profit after tax of $114.6 million in 2016 compared with $273.7 million in 2015.
Tringen reported net sales 0f $1.38 billion in 2016, which was 29 per cent less than in 2015, when the company had net sales of $1.95 billion.
Contributing to the reduction in net revenue was the lower international ammonia market prices, which decreased by 40 per cent in 2016 compared to 2015. Natural gas curtailments also contributed to the company’s reduced revenues and profits.
Tringen chairman Carl Chatoor, in his report, said gas curtailment for the period 2011 to 2016 resulted in a cumulative loss of about 500,000 tonnes of production.
In his outlook for 2017, Chatoor stated: “Ongoing gas curtailment will continue to negatively impact the company’s production and financial performance.
“The global ammonia prices saw an upward movement throughout the first quarter of 2017 due to widespread ammonia production closures and disruptions in Russia, Ukraine as well as the Middle East.
“The international ammonia market prices are expected to hold until the end of the second quarter and taper off in the third and fourth quarters.”
Tringen is 51-per cent owned by National Enterprises Ltd, which is publicly listed on the local stock market, and 49 per cent owned by Norwegian fertiliser giant Yara International. For its first quarter, Yara International reported a bigger-than-expected drop in core earnings as prices fell and the cost of natural gas, a key ingredient in production, continued to rise.
“Yara reports a weaker result than a year earlier, reflecting lower fertiliser prices and margins. However, we delivered increased sales volumes, both for fertiliser and industrial products,” Chief Executive Svein Tore Holsether said.
Operating profit before depreciation and amortisation (EBITDA), excluding special items, fell by 34 per cent to 3.34 billion Norwegian crowns ($390.19 million), while analysts had predicted a 23 per cent drop to 3.88 billion crowns.