Highlights of the Result:
• Production impacted by gas-supply limitations.
• Finance cost impacted by an increase in the exchange rate and the increasing cost of funds (driven by MPC rate changes).
Group Financial Highlights
Notore Chemical Industries Limited (Notore) recorded group YTD revenue of ₦4.1 billion for the period ended 31st March 2023, compared to ₦16.3 billion for the same period in 2022, representing a 75.8% decrease Y-o-Y. The Group recorded an operating loss of (₦1.71) billion for its first quarter ended 31st March 2023, compared to an operating profit of ₦5.60 billion for the same period during the prior year.
The Company’s financial performance was impacted by the shortage of natural gas, a feedstock to produce Urea fertilizer, during the period under review resulting in a decrease in production volumes.
Group Managing Director Mr Ohis Ohiwerei stated, “The shortage of natural gas significantly impacted our production capacity, thereby limiting our production output. We are working closely with our suppliers to find a solution to the gas shortage and are exploring alternative sources to ensure improved production output.”
Market Operational Developments:
Notore is committed to providing premium agricultural inputs to its customers. Though the limited gas supply impacted its first-quarter earnings, the Company is addressing the issue to ensure a steady natural gas supply. As a result, it is confident that it will return to profitability in the coming quarters.
The agricultural sector accounts for approximately 24% of Nigeria’s GDP, and one of the most crucial components of the sector is fertilizer to boost food production and growth. The fertilizer market in Nigeria is expected to continue growing in the coming years due to the increasing demand for food and the Federal Government’s efforts to promote agriculture. According to a report by Mordor Intelligence, Nigeria’s fertilizer market is projected to grow at a CAGR of 4.4% between 2021–2026.
The Federal Government continues to drive several initiatives to boost the agriculture sector, such as the Presidential Fertilizer Initiative (PFI) and the Anchor Borrowers Program (ABP). These initiatives aim to increase the production and use of fertilizers to improve crop yields and food security in the country.
Notore remains well-positioned to leverage opportunities to meet domestic and West African market demand.
Mrs. Olufela Olatoye-Sosan
Head, Corporate Communications
Investor Relations Contact
+234 807 328 6641
+234 908 876 4526
About Notore Chemical Industries Plc
Notore is a vertically integrated agro-allied and chemicals business situated in Onne (near Port Harcourt), Rivers State in South-South Nigeria and is engaged primarily in the production and sale of fertilizer products. Notore’s vision is to be the number one company by market share and profitability in our chosen businesses and a significant contributor to the development of Africa and our mission is to enhance the quality of life.
The Group’s current business comprises fertilizer production, supply and trading of fertilizer, and power. The Group’s primary fertilizer products are granular Urea and Ammonia. The Group operates from its Onne Complex in the heart of the Niger Delta, Africa’s most prolific oil and gas producing region.
The Onne Complex is located within the Onne Oil and Gas Free Zone, which provides significant tax benefits and advanced logistics solutions for international distribution of products. The Onne Complex comprises of approximately 560 hectares of land owned by the Group with a 2km of waterfront including the Notore Port and a dedicated jetty (with a capacity to accommodate vessels with a maximum volume of between 25,000 MT and 35,000 MT) owned by the Group. The Notore Port gives the Group easy access to the Atlantic Ocean for easy import of raw materials and export of the Group’s products.
The Group produces Urea, NPK and Ammonia and owns a Urea producing plant in Onne, Rivers State with a current annual design production capacity of approximately 500,000 MTPA of Urea and 330,000 MTPA of Ammonia. The Group also has an installed 2,000 MTD NPK blending plant. The Group currently supplies and sells its fertilizer products in all thirty-six (36) States and Abuja, the Federal Capital Territory. The Group trades and exports its manufactured fertilizer products to West Africa, South Africa, South America, and Europe.
For more information, visit www.notore.com
This announcement contains or will contain forward-looking statements which reflect management’s expectations regarding the Company’s future growth, results of operations, performance, business prospects and opportunities. Wherever possible, words such as “anticipate”, “believe”, “expects”, “intend” “estimate”, “project”, “target”, “risks”, “goals” and similar terms and phrases have been used to identify the forward– looking statements. These statements reflect management’s current beliefs and are based on information currently available to management. Certain material factors or assumptions have been applied in drawing the conclusions contained in the forward-looking statements. These factors or assumptions are subject to inherent risks and uncertainties surrounding future expectations generally. Notore Chemical Industries Plc cautions readers that several factors could cause actual results, performance or achievements to differ materially from the results discussed or implied in the forward-looking statements. These factors should be considered carefully, and undue reliance should not be placed on the forward-looking statements. For additional information with respect to certain of these risks or factors, reference should be made to the Company’s disclosure materials filed from time to time with Securities & Exchange Commission in Nigeria. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether because of new information, future events or otherwise.