Results at the end of September 2023: the OCP group posts a turnover of MAD 61 billion – Le Desk

At the end of September 2023, the OCP group’s results show a turnover of 61 billion dirhams, compared to nearly 89 billion dirhams the previous year. A drop explained by the decline in sales prices. The details

Published on November 20, the OCP group’s results at the end of September 2023 show a strong rebound in profitability in the 3rd quarter, driven mainly by the improvement in prices and the recovery in demand.

At the end of September, turnover reached 61.036 billion dirhams (billion dirhams) compared to 89.538 billion dirhams during the same period in 2022.

“This decline is mainly attributable to the decline in sales prices in all product categories compared to the exceptional price levels of 2022”we note.

For fertilizers, fertilizer turnover decreased by 28% compared to the same period of the previous year in local currency, mainly due to lower fertilizer prices year-on-year. This decrease was partially mitigated by increased export volumes, driven by increased global demand in our key export markets, primarily South America and Europe, OCP said.

“Over the period, rock turnover recorded a decrease of 429% while phosphoric acid turnover fell by 50% compared to the previous year in local currency. This decline is mainly explained by the drop in prices from one year to the next and the reduction in volumes exported to the main importing regions. However, OCP export volumes rebounded strongly in the third quarter, making up for some of the postponements in rock and acid sales encountered in the first half of the year.we continue from the same source.

EBITDA amounted to MAD 17.179 billion compared to MAD 42.964 billion achieved in 2022. The EBITDA margin stood at 28%. And finally, investment expenditure amounted to MAD 17.830 billion compared to MAD 15.226 billion made a year earlier.

Favorable market conditions continuing

For OCP, OCP’s results for the first nine months of 2023 were reinforced by the group’s performance in the third quarter, marking a significant rebound in profitability compared to the second quarter. We add that “The favorable market conditions that began in August persisted throughout September and continued in the fourth quarter, with a gradual increase in the prices of phosphate products, supported by a strengthening of demand in the main importing regions” .

The group emphasizes that it was able “take advantage of improving pricing, turning a 22% sequential increase in revenue in the third quarter into a more than three-fold increase in EBITDA compared to the second quarter of the year.”

Still as part of the announcement of its results, through its CEO Mostafa Terrab, the phosphate group indicates that sales of phosphate fertilizers constituted 69% of turnover during the first nine months of 2023, in progression to the 65% recorded in 2022.

The group also declares having maintained “strong interest in TSP, a very popular fertilizer for fertilizing leguminous crops. The first of three new fertilizer production lines, completed in the second quarter, is currently in the ramp-up phase for the manufacture of TSP. The two additional lines should be operational in early 2024. This initiative fits perfectly with OCP’s modular approach to expanding its capacities, adapted according to market needs.

Finally, in his communication, “ OCP welcomes the decision from the US Department of Commerce received in October 2023, significantly reducing countervailing duties on imports of Moroccan phosphate fertilizers to the United States to 2.12% compared to 19.97% previously.

“This new rate came into force from November 2023 until the conclusion of the next administrative review in the fourth quarter of 2024”signals OCP.

“The Department of Commerce (DOC) considered the detailed evidence provided by OCP during DOC’s initial administrative review and verification process. This result reflects OCP’s commitment to fully cooperate with the DOC review and verification process, which resulted in a significant reduction in tariffs.”we conclude.

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