Yara Reports Strong Q3 2024 with Improved Profitability Across Segments

Yara International ASA, a leading fertilizer company, released its third-quarter 2024 financial results on October 25. It showcased significant improvements in profitability across its operating segments. Their total revenue was $3.6 billion which was down by 3% Year on Year (YoY). They business in Africa and Asia regions earned the most profits with a whopping 190% YoY jump to $88 million.

Other Significant Metrics -

•             EBITDA: $604 million (up 52% year-over-year)

•             Net operating profit after tax (NOPAT): $982 million (up 150% year-over-year)

•             Return on Invested Capital (ROIC): 8.9% (up 147% year-over-year)

Across regions, Europe did 12% less business YoY and EBITDA was $82 million. This was due to heightened ammonia and gas prices. This was mainly due to limited commodity pre-buying in Southern Europe.

America did 10% better YoY in terms of EBITDA in the last quarter. The improved commercial margins in America and a positive impact of the currency.

Their biggest business boom came from African and Asian regions, indicating higher product margin in Asia and Asia-Pacific region. Last year the production was impacted majorly due to outages in Pilbara, Australia.

Segment-wise Performance:

• Global Plants & Operational Excellence: This segment, responsible for Yara's production facilities, saw a significant increase in EBITDA excluding special items to $108 million, compared to $49 million in Q3 2023.

This quarter saw a higher production volume and improved margins. Their production volume was also up this quarter due to an improvised operational performance.

• Clean Ammonia: EBITDA excluding special items reached $25 million, up from $7 million in the same period last year.

Ammonia plants in the US and Australia yielded higher production this quarter, which led to higher deliveries as compared to last year.

• Industrial Solutions: EBITDA excluding special items for this segment grew by 59% year-over-year to $89 million.

Higher margins and an improved production volume was the driving force behind gains in this segment. Total deliveries too improved by 1% YoY.

Yara remains focused on cost reduction initiatives and portfolio optimization to further strengthen its financial position. The company expects continued improvement in profitability and free cash flow generation. The final investment decision for Yara's US ammonia projects is targeted for the second half of 2025.

Overall, Yara's Q3 2024 results demonstrate a positive trajectory, with improved profitability across all segments. The company's focus on cost control and strategic investments positions it well for future growth.