Despite the strike that began at its Dead Sea Works and Bromine Compunds units in February, Israel Chemicals (TASE: ICL: NYSE: ICL) has reported higher profit for the first quarter of 2015. Proft jumped to $217 million compared with $131 million in the corresponding quarter of 2014.
Revenue, however, was down 13% to $1.403 billion from $1.613 billion in the corresponding quarter. Israel Chemicals estimates that the strike cost it $164 million in revenue, which was partly offset by improved sales by Rotem and in the UK.
Israel Chemicals president and CEO Stefan Borgas said, "The employee strike that was launched during the first quarter was expected and followed a long process of negotiations as part of the implementation of vital efficiency initiatives. However, gains from divestitures of non-core businesses during the quarter more than offset the financial impact of the strike, and we expect to recover most of our delayed potash production and sales in future periods following the conclusion of the strike. Despite the longer than expected duration of the strike, we expect a significant net benefit from efficiency measures implemented at these operations."
Borgas added, "Otherwise, I am pleased to report that our ongoing efforts to achieve operational excellence throughout our global operation continues to progress at, or above target. In addition, most of our growth initiatives are progressing ahead of schedule. These include our efforts to achieve organic growth through increased production and sales, especially at our potash units in the UK and Spain, as well our activities to achieve external growth through synergistic acquisitions, such as our recent purchase of Prolactal by our Food Specialties unit, and other initiatives aimed at broadening our access to natural resources worldwide, including our strategic alliance with China's Yunnan Yuntianhua, which will almost double our phosphates business and provide us with a strong operating platform in Asia. All of these measures are laying the ground for greater growth and profitability in the future."
Published by Globes [online], Israel business news - www.globes-online.com - on May 13, 2015
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