{"id":87912,"date":"2024-11-12T00:00:00","date_gmt":"2024-11-12T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/climate\/2024\/11\/12\/fertiglobe-reports-first-set-of-earnings-since-adnoc-acquisition-with-the-producer-set-to-snap-up-adnocs-stake-in-exxons-texas-hydrogen-project\/"},"modified":"2024-11-12T00:00:00","modified_gmt":"2024-11-12T00:00:00","slug":"fertiglobe-reports-first-set-of-earnings-since-adnoc-acquisition-with-the-producer-set-to-snap-up-adnocs-stake-in-exxons-texas-hydrogen-project","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/climate\/2024\/11\/12\/fertiglobe-reports-first-set-of-earnings-since-adnoc-acquisition-with-the-producer-set-to-snap-up-adnocs-stake-in-exxons-texas-hydrogen-project\/","title":{"rendered":"Fertiglobe reports first set of earnings since Adnoc acquisition, with the producer set to snap up Adnoc\u2019s stake in Exxon\u2019s Texas hydrogen project"},"content":{"rendered":"<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong> Fertiglobe sees dip in net income in 3Q on the back of decline in sales:<\/strong> Fertiglobe \u2014 a UAE-headquartered urea and ammonia exporter and MENA\u2019s largest producer of nitrogen fertilizers \u2014 reported USD 31.1 mn in adjusted net income attributable to shareholders, down 25% y-o-y on the back of several one-offs, according to its <a target=\"_blank\" href=\"https:\/\/ent.news\/2024\/11\/936.pdf\" style=\"\" rel=\"noopener\">earnings release (pdf)<\/a>. The now-Adnoc subsidiary \u2014 with Adnoc\u2019s USD 3.6 bn acquisition of the producer <a target=\"_blank\" href=\"https:\/\/enterprise.news\/uae\/en\/news\/story\/1518b3be-ab9f-4fa0-8564-6afaf3eb94a0\/adnoc-completes-acquisition-of%253cmark%253e-fertiglobe%253c%2Fmark%253e,-el-hoshy-staying-on-as-ceo\" style=\"\" rel=\"noopener\">closed last month<\/a> \u2014 saw its revenues fall 6% y-o-y to USD 496 mn in 3Q 2024.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>(Tap or click the headline above to read this story with all of the links <\/strong>to our background as well as external sources.)<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>On a 9M basis, Fertiglobe\u2019s adjusted bottom line attributable to shareholders fell 48% <\/strong><strong>y-o-y to USD 134.6 mn<\/strong>. The company\u2019s revenues also slipped 13% y-o-y to USD 1.5 bn during the nine-month period. <\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Fertiglobe saw its own-produced sales fall 7% y-o-y in 3Q due partly to the impact of power outag<\/strong><strong>es in Algeria and to natural gas curtailments in Egypt <\/strong>due to declines in production amid hot weather at the beginning of the quarter, Fertiglobe CEO Ahmed El Hoshy said. Meanwhile, the company\u2019s sale volumes inched down 2% to 4.2 mn tons during 9M 2024. Excluding these external factors, its own-produced volumes would have been up 2.1% y-o-y in 3Q and 5% in 9M 2024. <\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Behind the decline?<\/strong> Fertiglobe attributed part of the decline to adjustments in Algerian nitrogen fertilizer producer Sorfert\u2019s gas pricing setup from November 2023 to September 2024, according to its <a target=\"_blank\" href=\"https:\/\/ent.news\/2024\/11\/936.pdf\" style=\"\" rel=\"noopener\">earnings release (pdf)<\/a>. Negotiations for that are still ongoing, El Hoshy explained. <\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Looking ahead:<\/strong> Fertiglobe commissioned a boiler this month that produces steam, which they can use to generate power, and is expected to make it less reliant on the grid, El Hoshy told us. In Egypt, the Oil Ministry is also working to help restore natural gas production to meet the country\u2019s needs, including requirements for industrial producers like Fertiglobe, El Hoshy added.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>WATCH THIS SPACE- Fertiglobe plans to unveil its revised strategy in 1Q 2025<\/strong>, where it will clarify its strategic fit within the Adnoc platform, and further details around its plans as Adnoc\u2019s low-carbon ammonia vehicle, while providing information on initiatives planned to enhance margins and revenues through manufacturing improvement and cost optimization programs, El Hoshy told us. <\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Fertiglobe expects the market to remain favorable<\/strong>, with short-term demand for nitrogen fertilizers staying robust, driven by tight market conditions and \u201crecord low\u201d Chinese exports of urea. In the long term, the sector will be supported by projected growth in demand from both new and existing applications, coupled with limited supply growth.<\/p>\n<p class=\"tag-border-left\">Adnoc transfers stake in Exxon Texas hydrogen project to Fertiglobe- <\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Fertiglobe<\/strong><strong> to hold Adnoc\u2019s stake in Exxon\u2019s Texas hydrogen project<\/strong>: Adnoc will transfer a 35% stake in the Baytown, Texas low-carbon ammonia project to Fertiglobe, along with two unspecified UAE projects, according to the statement. The stakes will be transferred at cost, ensuring that, once operational, they will contribute immediately to Fertiglobe's earnings, supporting project returns while \u201cpreserving the company\u2019s balance sheet during the development and construction phase.\u201d<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>The transferred stakes are set to more than double Fertiglobe\u2019s total capacity to 9.0 mn <\/strong><strong>tons per annum (mtpa)<\/strong>, with the addition of the two UAE low-carbon ammonia projects, which include a 1 mtpa project under construction and another in the pre-FEED stage, adding 2.4 mtpa, while the Texas project will contribute 1 mtpa. <\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>The \u201cglobal\u201d approach will mean more diverse routes and shorter distances: <\/strong>The US project will expand Fertiglobe's presence into the US, alongside its facilities in Egypt, Algeria, and the UAE, El Hoshy told us. This means that low-carbon products will now travel \u201cshorter distances, where anything that was supposed to come from Texas to Korea now goes from the UAE to Korea, while Texas product goes to Europe,\u201d avoiding long distances and reducing emissions, he added.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>REFRESHER-<\/strong> Adnoc signed a strategic partnership agreement with US energy giant Exxon Mobil to purchase a <a target=\"_blank\" href=\"https:\/\/enterprise.news\/uae\/en\/news\/story\/be3bac42-d21c-4ef3-befd-3f58320b1948\/adnoc-to-snap-up-35%2525-of-exxon%25e2%2580%2599s%253cmark%253e-texas%253c%2Fmark%253e-hydrogen-project\" style=\"\" rel=\"noopener\">35% stake<\/a> in Exxon\u2019s low-carbon hydrogen project in Texas, which already has an offtake agreement with Japan\u2019s biggest power producer, Jera, and agreements with France\u2019s Air Liquide to build and operate air separation units for oxygen and nitrogen supply to the facility. <\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>The Texas project will enable Fertiglobe to tap into the growing demand worldwide for <\/strong><strong>ammonia<\/strong>, positioning the firm as a \u201clow-carbon ammonia growth platform with global reach.\u201d The project is pending a final investment decision, expected to be reached in 2025.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>The fact that the project will be sold at cost allows the company to \u201cwarehouse the capital, and the debt involved<\/strong> in building these projects with Adnoc until operations,\u201d El Hoshy told us. <\/p>\n","protected":false},"excerpt":{"rendered":"<p>Fertiglobe incurred USD 19.3 mn in losses<\/p>\n","protected":false},"author":1,"featured_media":87913,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","ep_exclude_from_search":false,"_primary_brand":0,"newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[106],"tags":[80,105,249,11,319,298],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-87912","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-earnings-watch","tag-adnoc","tag-earnings-watch","tag-energy","tag-enterpriseclimate","tag-fertiglobe","tag-hydrogen","wpautop","entry"],"acf":{"mongo_id":"0542d4f2-970a-4b14-a6ab-13556bd6b032","order":"3","is_powered_by":false,"story_type":"1","photo_url":"https:\/\/ent.news\/2024\/11\/1053.jpg","photo_position":"above","homepage_title":"","full_issue_title":"Fertiglobe reports first set of earnings since Adnoc acquisition, with the producer set to snap up Adnoc\u2019s stake in Exxon\u2019s Texas hydrogen project","related_issue":[87907],"teaser":"Fertiglobe incurred USD 19.3 mn in losses","voice_url":"https:\/\/s3.us-east-1.amazonaws.com\/ent.news\/audio\/2024\/11\/.853b6b91-d7b2-4921-84f4-46989f995113.mp3"},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.1 (Yoast SEO v27.1.1) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Fertiglobe reports first set of earnings since Adnoc acquisition, with the producer set to snap up Adnoc\u2019s stake in Exxon\u2019s Texas hydrogen project - Climate<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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