OREANDA-NEWS. On 27 March 2008 was announced, that consolidated revenues of JSC Acron under Russian Accounting Standards in 2007 rose 28% to RUB 30.876 billion, up from RUB 24.061 billion in 2006. Cost of goods sold went up 21% to RUB 17.713 billion, from RUB 14.645 billion in 2006.

Operating income grew by 53% year-on-year to RUB 8.527 billion, from RUB 5.579 billion.

Net profit for the accounting period was RUB 13.222 billion after factoring in the RUB 7.571 billion gain from a mark-to-market adjustment of financial investments. Net profit prior to the revaluation of financial investments rose 79% year-on-year to RUB 5.651 billion, from RUB 3.152 billion.

EBITDA rose 62% to RUB 8.736 billion from RUB 5.390 billion in 2006, with an EBITDA margin of 28% compared to 22% in the previous year.

JSC Dorogobuzh saw 2007 consolidated revenue up 35% year-on-year to RUB 7.713 billion, from RUB 5.705 billion.

Dorogobuzh’s net profit for the accounting period was RUB 2.910 billion after factoring in the RUB 1.439 billion gain from a mark-to-market adjustment of financial investments. EBITDA more than doubled to RUB 2.171 billion from RUB 0.898 billion in 2006, and EBITDA margin was 28% compared to 16% in the previous year.

Net profit before the revaluation of financial investments was RUB 1.471 billion, or triple the 2006 figure of RUB 0.482 billion.

Senior Vice President of JSC Acron Alexander Popov commented on the results:

“ The development strategy adopted by the company in 2007 proved to be efficient in terms of increasing profits as well as counteracting negative factors and risks. The key pillars of the company’s strong growth are our expansion of production capacity and development of an independent raw material base, as well as improvements to logistics and distribution. Tighter cost control helped us mitigate the negative impact of substantially higher costs for raw materials, natural gas, apatite concentrate and potassium chloride, as well as temporary suspensions of complex mineral fertilizers production at Acron due to shortages of apatite supplies.

“As to operations, we are seeing our investments being paid off. Last year we brought urea-formaldehyde resin production to full capacity and launched a line to produce a new brand of liquid fertilizers at the Veliky Novgorod site. Hongri Acron also reached full capacity at its new methanol unit.

“Global fertilizer market conditions were also important to the company’s success last year. Strong demand for fertilizers resulted in substantially higher prices in Q4 2007, which improved the year-end financials.

“Dorogobuzh’s financials were improved by the substantial expansion of production capacity generated due the company’s transition to a two-year non-stop operating cycle. In addition, Dorogobuzh, which produces the most popular nitrogen fertilizers in Russia, has notably increased its domestic supplies.

“Last year Dorogobuzh continued introducing more resource-saving technologies. In July 2007, a process of hydrogen recovery from the purge gas was launched at the ammonium production plant, which increased daily ammonia output by 4% given the same gas consumption levels.”