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Press Release: PVFCCo reaches remarkable achievements in the first 9 months of 2018

17/10/2018


Petrovietnam Fertilizer & Chemicals Corporation (PVFCCo - Securities code: DPM, the Phu My fertilizer manufactuer and trader) stated that PVFCCo reached remarkable achievements in all aspects thanks to its operation efforts in spite of continuously facing with challenges in the first 9 months of 2018.

It could be said that in the first 9 months of this year, PVFCCo had to confront with “double” challenges originating from the price of input materials and the demand of fertilizers reduced because of the sharp decrease in price of agricultural products. Due to the effect of increase in oil price, the price of input gas used for fertilizer manufacturing has increased about 28% in comparison with the same period of 2017 and about 29% in comparison with planned price in 2018. Specifically, the average price of gas in the first 9 months of 2017 is $4.94/ million BTU, the planned price in 2018 is $4,9/ million BTU, in fact, in the first 9 months of 2018, the price is $6.31/million BTU, as a result, for every $1/million BTU the price of gas increased, the manufacturing cost of PVFCCo rose about VND 500 billion /year.

Agricultural manufacturing and fertilizer market in the first 9 months of this year have been greatly affected by extreme weather and the sharp decline in price of agricultural products. According to statistics of Ministry of Agriculture and Rural Development, as compared to the same period of 2017, nationwide rice-planting areas in has fallen by 160,000 ha; the price of key agricultural products such as coffee has decreased by more than 20%, the price of pepper has decreased by 30% and series of pepper trees has been dead because of epidemic diseases, the price of rubber has reduced by nearly 20%, etc. Besides, storms, floods and heavy rains occured on a large scale, making the demand of fertilizers in Summer-Autumn crop/rainy season – with the largest consumption of fertilizers - considerably decrease.

In this extremely challenging concept, PVFCCo actively prepared many plans, offered solutions and took efforts in all aspects: corporate management, cost administration; implementing projetcs; operating, manufacturing, trading, researching and developing new products.

PVFCCo actively implemented projects and, since the beginning of 2018, revamped NH3 unit has been put into operation commercially; up to 8/2018, NPK chemical technology plant has been also put into commercial use, which have a considerabe contribution to the productivity increase of PVFCCo in the first 9 months of this year.

In term of manufacturing, it was estimated to achieve 650,000 tons of Phu My Urea, completing 109% of the 9-month plan and 81% of the annual plan; the production of NH3 for commerce was over 49,000 tons, fulfilling 119% of 9-month plan and 89% of the year plan, increasing 247% in comparison with the same period; the production of Phu My NPK plant was over 54,000 tons.

In term of trading fertilizers, sale team always has paid a lot of attention to market, quickly approached, effectively taken an advantage of fertilizer-using demand in areas and “emerging and newly ranked” trees such as avocado, duria, citruses, etc. Therefore, total fertilizer output for consumption was 910,000 tons, in which Phu My Urea accounts for around 640,000 tons, exceeding 5% in comparison with the 9-month plan; the trading volume of other types of fertilizer was about 270,000 tons, exceeding 50% in comparison with the 9-month plan, fullfilling 120% of the 2018 plan. Especially, thanks to meticulous preparation for market in the recent years, in the first 9 months, PVFCCo’s new key fertilizer product - Phu My NPK (including the quantity of NPK manufactured by plant) hit the record level of consumption output of nearly 100,000 tons, increasing by 26% in comparison with the same period of year 2017.

Chemical trading also reached considerable achievements with NH3 consumption output of 36,000 tons, increasing by 130% in comparison with the same period of 2017; the trading volume of UFC85, CO2, petrochemicals reached nearly 40,000 tons.

Total revenue in the first 9 months of 2018 was estimated at VND 7,095 billion, achieving 108% of the 9-month plan, 83% of the annual plan, increasing 8% in comparison with the same period of 2017; profit before tax was VND 625 billion, achieving 141% of the annual plan 2018. Revenue, profit exceeded the plan as a result of the fact that NH3-NPK project has come into operations, contributing to output increase; plan-exceeded business output with efforts to minimize costs. Especially, due to focus on branding, key products such as Phu My Urea, Phu My NPK fertilizer, other Phu My fertilizers, and NH3 always keep being sold at a high price level, fast consumption and reasonable inventory.

Mr. Duong Tri Hoi, Vice President of PVFCCo said: “The commercial operation of new plants and active exploitation of market & new customers have created a turning point for PVFCCo. With the positive results, PVFCCo aims to fulfill its 2018 plan as well as create favorable basis for 2019.”