Svein Tore Holsethers first year as the chief in Yara has been hectic, with travel from Thailand to Florida.
Under his leadership, plans Yara now record high investment, expansion of factories and mines, and the purchase of the freighter.
It makes the company in the midst of a challenging period, where gjødselprisene have fallen because of overproduction. Yara delivered on Friday one of its worst quarterly results in several years, despite lower energy costs and higher production, but the result was nevertheless better than the market expected.
the Stock ended up nearly four per cent on the Oslo stock Exchange, and was the day’s most traded share.
E24 Aksjelive: Follow the market trends here
Invest over 50 billion.
Yara is about to invest over 50 billion nok in the period between 2015 and 2018, with a peak of 16 billion next year.
in comparison, the company invested only 12.5 billion two years ago, and even less in the years before.
The levels we are at now is the highest levels ever, ” says Holsether to E24.
Yara loses at low prices
Provides milliardinntekt
Although the low gjødselprisene should stick, will the planned investments help to increase the Yaras result with five crowns per share in 2020, ” says toppsjefen. It is equivalent in this case 1,37 billion. Should prices increase, your payoff will be even greater.
the BUSY MAN: Svein Tore Holsether took over as president and ceo of Yara in september 2015, and has had a hectic first year with over 200 artist.
– This is the projects that provide earnings even on the demanding prices that are in the day, ” says Holsether.
the Investment will remove bottlenecks and expand capacity at existing factories, particularly for value-added products that provide higher price in the market than the raw materials.
– We put the two-and-a-half billion dollars in Porsgrunn. It is based on what we do out in the markets, like in Brazil, to develop the premium markets, ” says Holsether.
200 artist
Since Svein Tore Holsether took over the management in september 2015, he has had over 200 artist, to meet the farmers who grow kinakål in Thailand, coffee and maize in Africa, soybeans in Brazil, almonds in California, citrus fruits in Florida and the grass in Ireland.
I have spent very much of my time traveling to see as much as possible of the business, ” says Holsether.
I think I underestimated a little bit how big and global this is, and how close we are to customers, ” he says.
New mills
This is some of Yaras investments in the period 2015-2018:
the Expansion of the factory in Porsgrunn: 2,2 mrd. money
New salpetersyrefabrikk in Köping, Sweden: 1.4 billion. money
the Expansion of ureaproduksjon in Sluiskil, the Netherlands: 1,7 mrd. money
the Upgrade of the facility in Rio Grande, Brazil: 2,8 mrd. money
New ammoniakkfabrikk together with BASF in Freeport, united STATES: 3,7 billion. money
Five new cargo ships for ammonia: 1,6 billion. money
the Expansion of fosfatgruven Galvani in Brazil: 3,7 billion. money
Yara makes milliardkjøp in India
Global overproduction
Holsether says he has used his first year to build a new management team, and in addition to cut costs to be able to handle a period of lower prices.
the Background of the global overkapasiteten of fertilizer is particularly low gas prices, especially in the united STATES, which has led to the expansion of the gjødselproduksjonen. Countries such as Saudi Arabia, Algeria, Egypt and Iran has also increased its production capacity.
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– It is very much like going on a time, ” says Holsether.
–Very much of it is a result of a very much lower gas market in the united STATES that has triggered new investments, ” he says.
Think of price rises
Roughly speaking, it is the case that a new urea factory that can produce a million tons a year, costing two billion dollars, ” says Holsether.
– Should you have a ten percent return on your investment, then it is 200 dollars. And when ureaprisen now is $ 200, then it means that with free gas, or free employees so you are still not more than the required return, ” says Holsether.
And gas, and employees are not free, ” he says.
Yara-the boss, nevertheless, believe that prices will rise again in the long term. The prices have fallen so much that it will be built in a few new gjødselsfabrikker in the years ahead, while the global demand for fertilizer is expected to rise.
But it gets tough in the period between, ” says Holsether.
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