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Higher production, sales pull Jordan Phosphate Mines Co. back from loss

By Samir Ghawi - Nov 15,2014 - Last updated at Nov 15,2014

AMMAN — Jordan Phosphate Mines Company (JPMC) maximised its operational profit by 217.3 per cent, or JD22.9 million, during the first nine months of this year, according to a disclosure the corporation sent to the Amman Stock Exchange.

As a result of achieving a JD33.5 million operational profit, compared to JD10.5 million registered during the January-September period of last year, JPMC succeeded in emerging from a JD6.7 million loss posted at the end of June 2014 to a JD8.7 million net profit as of September 30, 2014.

"This shows that the corporation generated a JD15.4 million profit during the third quarter of this year, JD10.1 million higher than the JD5.3 million posted during the same period of 2013," JPMC indicated in the disclosure.

The corporation noted that the profit was attained after making a  JD6.5 million provision for staff incentives in the third quarter, or an accumulated JD19.5 million for the incentives for the full period until the end of September 2014, as per labour deals agreed in previous years.

The disclosure revealed that JPMC's sales during the first nine months of this year amounted to JD523.1 million, 25.3 per cent higher than the JD417.5 million recorded during the same period of last year.

JPMC attributed the rise in sales to a noticeable increase in phosphate exports at the end of the third quarter as the volume went up by 997,000 tonnes reaching 4.3 million tonnes.

This volume represented a 41.7 per cent surge as exports during January-September 2013 stood at 3.1 million tonnes.

Sales of fertilisers also soared by 61.2 per cent, or 172,000 tonnes reaching 453,000 tonnes at the end of September 2014 compared to 281,000 tonnes at the end of September 2013.

"Sale prices were affected this year by stiff competition in the international market," the corporation indicated in the disclosure pointing out that the phosphate average sale price per tonne dropped by $16 compared to the price level that prevailed at the end of last year's third quarter.

Similarly, the fertiliser sale price went down by $43 per tonne by the end of this year's third quarter compared to the price level at the end of September 2013.

Furthermore, JPMC listed other factors that affected production costs, mentioning, as examples, higher mining fees, an increase in fuel prices, and a rise in water and electricity charges.

"To counter the effect of these increases on the costs per each unit of    output, the company resorted to ramp up phosphate and fertiliser production at the end of this year's third quarter," the disclosure said.

Consequently, it added, the phosphate third quarter output went up to 5 million tonnes at the end of September 2014, compared to 4 million tonnes at the end of September 2013.

Similarly, the fertiliser third quarter output shot up to 431,000 tonnes  at the end of September 2014 compared to 319,000 tonnes at the end of  September 2013.

Financially, the disclosure showed that JPMC's total assets at the end of September 2014 amounted to JD1,200.5 million, of which JD459.5 million were current assets and JD741 million were fixed assets. At the end of 2013, total assets stood at JD1,112.5 million.

Total liabilities amounted to JD429.6 million, of which JD344.6 million were current liabilities and JD85 million were long term. At the end of last year, total liabilities stood at JD350.2 million.

Shareholders' equity totalled JD771 million at the end of September 2014, higher than the JD762.3 million as of December 31, 2013. 

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