The performance is due to a substantial increase in higher acid and fertilizer volumes.
Rabat – Morocco’s OCP Group has announced that its revenues for the first quarter of 2019 have reached MAD 12,521 ($ 1.31 billion), up from MAD 10,419 million or $ 1.13 billion in the same period in 2018.
The group said that its earnings before interest, tax, depreciation and amortization (EBITDA) reached 4,364 million Dirhams (US$ 456 million), against MAD 2,516 million Dirhams ($ 273 million) in the first quarter of 2018.
EBITDA margin increased to 35% from 24% in last year’s first quarter, according to OCP’s press release quoted by Maghreb Arab Press (MAP).
OCP said that the notable performance stems from a substantial increase in the amount of acid and fertilizers the company has so far produced this year.
OCP added that its gross margin was 42% to MAD 9,003 million Dirhams or $ 942 million against MAD 6,354 million ($ 690 million) last year.
The gross margin performance reflects a “favorable product mix and higher revenues, while raw material prices were stable for sulfur and lower for ammonia,” OCP noted.
The group’s first quarter operating profit also reached MAD 2,536 million ($ 265 million), up from MAD 1,158 million ($ 126 million) during the same period in 2018.
OCP said that market conditions in the first quarter were in line with its expectations in terms of price fluctuations, MAP added.
“Demand from India remained somewhat stronger than anticipated despite high inventory levels; European demand recovered from last year’s lows, and there was a modest uptick in imports to Brazil. Conversely, adverse weather conditions affecting the Spring planting season have kept North American inventories high,” the press release added.
OCP announced a successful performance on the supply side, emphasizing that Chinese exports “increased year-on-year tied to lower domestic consumption.”
The company added that the EBITDA margin continued to “benefit from the Company’s industrial flexibility across the value chain, which drove favorable product mix and from its commercial agility that positions OCP as a key global supplier across all major importing continents.”
OCP, which is the largest phosphate producer in the world, has approximately 21,000 employees.
The company also contributes to regional development in several sectors, including mining and fertilizer operations, as well as through its sustainability program.
OCP in Morocco’s South-South agenda
On the continental front, the company is increasingly establishing itself as a driver of growth and intra-African food security program.
Since February 2016, when the Moroccan officially launched its African venture with a dozens of branches in sub-Saharan Africa under the banner OCP Africa, it has landed important agricultural contracts with a number of African governments.
The contracts mostly include projects to provide adequate fertilizers to African farmers on the basis of soil type in their regions as well as conventions to assist governments in the construction of fertilizer plants.
Most recently, OCP Africa announced an ongoing project to launch an African platform for digitized agriculture. According to OCP, the push towards Africa is part of part of the plan to accompany Morocco’s vision of increased intra-African exchanges to reach food security and sustainable development on the continental level.