CAPTION: K+S may not achieve earnings target due to potash price movements. (picture alliance / dpa / Klaus-Dietmar Gabbert)
German agricultural products supplier K+S on Wednesday said it may not hit the earlier annual earnings outlook due to the price movements in potash.
In May, the company had said it was expecting EBITDA of €1.15 billion ($124 billion) to €1.35 billion for the fiscal year.
It expects a greater clarity regarding the annual results only after movement of significant volumes in the important overseas market of Brazil.
It has contracted with Chinese customers for the supply of potassium chloride until the year end at a price of $307 per ton.
In case the Chinese potassium chloride price reflects into other markets and there is no price recovery from the levels reached it then expects a total EBITDA of €0.8 billion for the year.
However, the company expects the price to recover in the second half of the year resulting in EBITDA exceeding €0.8 billion.
For the second quarter of 2023, the company expects a negative impact on its EBITDA with a low triple-digit million euro amount, on the conclusion of the Chinese contract and lower prices in Brazil along with lower sales volume based on the wait-and-see attitude of the customer.
Currently, shares of K+S are trading at 14.85 euro down 6.61% or 1.05 euro on the Xetra Exchange.
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