On the occasion of the publication of its results for the first quarter of 2022, Morocco’s Cheriffian Phosphates Office (OCP) Group announced a significant increase in its turnover, precisely 77% compared to this period last year. The increase translates to MAD 25.5 billion, against MAD 14.2 billion in 2021.
In a press release, the group said it managed to realize such significant results through high sale prices and an optimized cost structure, despite a lower production volume, which it plans to increase by about 10% in 2022.
OCP also specifies that “the Russian-Ukrainian conflict has intensified the tense situation in terms of supply-demand balance on the phosphate market and has led to a further increase in prices, which has also been supported by the increase in raw material costs.”
The group benefited from an improvement in its sales prices over the period, offsetting the sales’ volume.
OCP’s gross margin is set at MAD 15.8 billion, up 71%, as of the end of March 2022.
“The increase in sale prices neutralized the impact of the rise in input costs,” namely sulfur and ammonia, reports OCP, adding that “the gross margin rate reached 63% against 65% in the first quarter of 2021.”
Regarding the Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA), it stood at MAD 11.6 billion, up 117% compared to last year’s MAD 5 billion, generating a solid EBITDA margin of 46%, up 9 points from the 37% recorded in the same period last year.
As for capital expenditures, the office stated that they totaled “MAD 2,988 million, compared to MAD 1,750 million in the first quarter of 2021.”
The OCP group had announced record results reported last March. This had allowed the group to pay an unprecedented dividend to the State set at MAD 8.1 billion.
In summary, OCP underlines that “the solid performance posted by OCP in the first quarter of this year allows for a year of significant growth and supports the group’s positive outlook for 2022”.
“The price increase is expected to continue over the year, supported by solid market conditions, reflecting strong global demand, a tight supply situation and rising raw material prices,” reads the press release.
In addition, OCP continues to invest in environmental and social programs in order to maintain its positive impact on global food security.
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