Notore Chemical Industries Plc has declared a decline by 16.03 per cent in revenue after recording N12.68 billion in 2019, compared to N15.17 billion in the corresponding period in 2018, its unaudited six months financial results showed.
The company witnessed a loss of N1.84 billion as against N2.55 billion which is a 27.7 per cent reduction in loss.
Why Notore’s revenue dropped: The decline was blamed on plant downtime during the period under review as a result of the turn-around maintenance (TAM) programme activities.
The impact on revenue may continue as the TAM programme is expected to be completed by the first quarter (Q1) of 2020 when the plant is expected to operate at its nameplate capacity.
Other results and losses: Cost of sales also dropped to N9.636 billion in 2019 from N11.404 billion in 2018. Due to the net finance cost that grew from N5.144 billion in 2018 to N6.57 billion in 2019, Notore posted a loss of N1.942 billion in H1 of 2019.
However, the loss is a positive result for Notore as the company recorded a loss of N4.517 billion in the corresponding period of 2018.
The future is still bright for Notore: The company said it expects growth in Nigerian fertilizer demand because of the Federal Government’s agenda to use agriculture as one of the keys to unlock the diversification of the Nigerian economy.
Notore added that the market is robust and yet to reach its full potential, with the demand for urea and compound fertilizers, such as NPK, from the West African markets and Sahel African states growing.
“The domestic fertilizer market is yet to reach its full potential as the consumption of fertilizer per hectare of arable land in Nigeria is below 10kg compared to the 200kg recommended by Food & Agriculture Organisation.
“Furthermore, the demand for urea and compound fertilizers, such as NPK, from the West African markets and Sahel African states is also quite significant. Notore sold all the urea that it produced during the period under review.
“Consequently, Notore will be producing a significant quantity of NPK and NPK specialty blends this FY to boost its revenues as well as diversify it from urea fertilizer.
“To enhance profitability, Notore is working on financial initiatives to reduce its finance cost considerably,” the company said.
Notore is certain it will improve on the 2018 financial year urea production figures in 2019, stating that the market demand for NPK and current Federal Government policies are favourable to its operation, the Notore H1 2019 FY Performance Summary disclosed.
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.
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 Notore Chemical Industries Free Zone, which provides significant tax benefits and advanced logistics solutions for international distribution of products.