MOSCOW (MRC) -- Poland's largest chemicals maker, Grupa Azoty, doubled its first-quarter net profit and beat market forecasts as mild winter boosted fertiliser sales while lower gas tariffs translated into higher margins, said Reuters.
The state-controlled group closed its seasonally best quarter with a bottom line of 276 million zlotys (USD76 million), while analysts expected a profit of 203 million zlotys. Overall sales rose by 5% to 2.84 billion zlotys. Analysts polled by Reuters forecast 2.854 billion zlotys.
"We benefited from mild winter that allowed farmers to use fertilisers earlier than usually, increasing our sales in this segment of the market," Grupa Azoty's deputy chief and chief financial officer Andrzej Skolmowski said in a statement.
"Polish zloty depreciation strengthened our competitiveness in international markets whilst lower prices of natural resources reduced our costs, boosting our performance in the export-oriented parts of the business," he added.
The group said it signed UOP, a unit of U.S. conglomerate Honeywell International, to design technological solutions for Azoty's 1.68 billion zloty project to build Europe's largest propylene plant.
Azoty flagged the investment -- its biggest ever -- to capitalise on a regional shortage of the chemical used to make paint. The plant, part of the group's 7 billion zloty investment plan, is to be completed by 2020. It will increase Grupa Azoty's annual sales by about 2 billion zlotys and profit by "hundreds of millions of zlotys".
As MRC informed earlier, Poland’s Grupa Azoty is making a USD450m entry into the global propylene market, in a move that underscores its position as one of Europe’s biggest chemical companies. The investment, the largest in the company’s history, will create Europe’s biggest production plant for propylene, a critical chemical in the production of plastics and solvents, used in a range of products including car parts, carpets and toys.
MRC