Fertiglobe Shareholders Approve H2 2023 Dividends Of $200 Mn

Fertiglobe, a leading entity in the global fertilizer industry, convened its Annual General Meeting (AGM) on April 30, 2024, marking a significant milestone in its operational journey. During this pivotal gathering, shareholders ratified the audited financial statements for the year 2023 and sanctioned a cash dividend distribution of $200 million for the second half of 2023, equating to 9 fils per share. This decision elevated the total dividend payout for 2023 to an impressive $475 million, showcasing one of the highest dividend yields within Fertiglobe's sector. This achievement underscores the company's robust financial health and its commitment to generating substantial returns for its shareholders, with a cumulative $2,265 million returned since its initial public offering.

Dr. Sultan Ahmed Al Jaber, Chairman of Fertiglobe, highlighted the company's strong financial performance in 2023, attributing it to its resilience amidst fluctuating urea and ammonia prices. He emphasized Fertiglobe's strategic advancements in low-carbon ammonia production, including the launch of renewable ammonia shipments and the integration of innovative carbon capture technology in its UAE facilities. These steps not only reinforce Fertiglobe's sustainability commitments but also position it as a leader in the transition towards cleaner energy sources.

Ahmed El-Hoshy, Chief Executive Officer of Fertiglobe, reflected on the company's achievements over the past year. He pointed out several operational and sustainability milestones that have poised Fertiglobe for significant growth. The company's agility in navigating market dynamics has been pivotal in enhancing shareholder value while pursuing sustainable growth. El-Hoshy also mentioned the Manufacturing Improvement Plan (MIP) and cost optimization efforts that are instrumental in bolstering Fertiglobe's financial performance and free cash generation capabilities.

In terms of financial outcomes for 2023, Fertiglobe reported a commendable increase in sales volumes and revenue, with full-year figures reaching $2,416 million. The adjusted EBITDA stood at $1,004 million, translating to an adjusted net profit of $363 million. These figures reflect a healthy adjusted EBITDA margin of 42%, demonstrating Fertiglobe's operational efficiency and profitability.

Looking forward, ADNOC's strategic move to acquire OCI’s entire 50% stake in Fertiglobe for $3.62 billion is a testament to its confidence in Fertiglobe’s potential and strategic direction. This acquisition aligns with ADNOC’s chemical growth strategy and ambitions to establish a global platform for ammonia production. Post-transaction, ADNOC’s ownership in Fertiglobe will surge to 86.2%, further solidifying its influence over the company’s future trajectory.

Fertiglobe’s commitment to operational excellence and cost optimization is expected to drive significant EBITDA growth by the end of 2025. The integration of Artificial Intelligence (AI) across its operations is set to unlock additional value, enhance operational efficiencies, and reduce emissions. With a strong focus on sustainable growth and shareholder value maximization, Fertiglobe is well-positioned for future success.

Supported by robust free cash generation and a solid balance sheet, Fertiglobe continues to strike a balance between rewarding shareholders through dividends and investing in selective growth projects. The company’s investment grade status is further affirmed by S&P and Fitch’s positive credit watch placement in Q1 2024, pending the completion of ADNOC’s stake acquisition. This strategic move not only strengthens Fertiglobe’s market position but also enhances its capability to lead in the global shift towards low-carbon ammonia production.

With inputs from WAM