Yara delivers improved returns reflecting higher prices in third quarter. Net income was a negative USD 143 million, compared with a positive USD 340 million a year earlier. The negative net income includes a USD 355 million impairment of Salitre assets in line with Yara’s regulatory release dated 1 August 2021, and a currency translation loss of USD 148 million. Excluding currency effects and special items, the basic earnings per share was USD 1.33 compared with USD 0.88 per share in third quarter 2020.
The main elements of the third-quarter results are:
- Improved returns reflecting higher prices
- 8.3% ROIC1, up from 7.9% a year earlier
- 40% ammonia curtailment in Europe due to natural gas price spike
“Yara delivers solid third quarter results, with EBITDA2 excluding special items up 37%, mainly thanks to improved margins. However, the gas price spike in Europe has led to Yara curtailing around 40% of its European ammonia production,” said Svein Tore Holsether, President and Chief Executive Officer of Yara.
“European nitrogen production is essential to global food security, and we are therefore concerned about the impact current European natural gas prices will have, especially for the world’s poorest regions. However, Yara will do its utmost to supply farmers and support global food production. The current situation clearly demonstrates the need for more resilient food supply chains, and I call on authorities, international organizations and food value chain players to work together to secure global food supply,” said Holsether.
Third-quarter operating income was USD 121 million, compared with USD 384 million a year earlier. Earnings per share excluding currency effects and special items was USD 1.33, compared with USD 0.88 per share in third quarter 2020.
Yara’s leading food solutions and ammonia positions are well placed to both address and create business opportunities from global challenges, as the twin demands of increased resource efficiency and lower environmental footprint require significant transformations within both agriculture and the hydrogen economy.
Link to report, presentation and webcast 20 October at 12:00 CEST:
1) Return on invested capital, for definition and reconciliation of ROIC see APM section in 3Q report page 30
2) For definition and reconciliation of EBITDA excl. special items, see APM section in 3Q report page 29
Note on Alternative performance measures: Alternative performance measures are defined, explained and reconciled to the Financial statements in the APM section of the Quarterly report on pages 29-34.