Israel Chemicals (TASE: ICL: NYSE: ICL) today reported its financial results for the fourth quarter and full year 2019. The company's fourth quarter revenue of $1.1 billion compared with $1.4 billion in the corresponding quarter of 2018, led to a decrease in annual revenue from $5.6 billion in 2018 to $5.3 billion in 2019.
The company's operating profit and adjusted operating profit was $88 million in the fourth quarter of 2019, compared with operating profit and adjusted operating profit of $166 and of $214 million, respectively, in the corresponding quarter of 2018. Operating profit was $756 million in 2019 compared with $1.519 billion in 2018, which also included a capital gain of $841 million from divestments. Adjusted operating profit of $760 million in 2019 was slightly higher than $753 million in 2018.
Revenue and profit were hit by the closure of the company's Dead Sea potash plant for a month for the successful upgrade of facilities, which will increase capacity by 5%. The closure also affected bromine production. Lower production, and the absence of a potash supply contract to China and weak commodity markets, resulted in a significant impact on results, the company added.
Israel Chemicals will extend its existing policy of returning up to 50% of adjusted net income to shareholders through dividends. Dividends for 2019 amounted to $0.18 per share, similar to 2018.
Israel Chemicals president and CEO, Raviv Zoller said, "ICL achieved several important milestones in 2019, the most recent of which was the upgrade of our Dead Sea facilities. While ICL's results for the fourth quarter were impacted by disruptions associated with the upgrade, a weak environment for commodity fertilizers and the unfavorable impact of exchange rates, we believe that the actions we have taken throughout 2019 have significantly strengthened ICL's position and prospects to create value for our shareholders for years to come."
He added, "We also completed the construction of our new food grade phosphoric acid plant in China that will allow us to shift from commodity phosphates to specialty products. We also introduced breakthrough solutions for plant-based meat alternatives and executed strategic long-term agreements with bromine compounds' customers, which further demonstrates our ability to execute on our specialty-focused growth strategy. ICL's business mix continues to strengthen as we increase our focus on developing innovative products, novel materials and cost-effective processes that will create competitive advantages for ICL."
Published by Globes, Israel business news - en.globes.co.il - on February 13, 2020
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