Phosagro S Regulatory News (PHOR)

For Immediate Release

2 August 2021

 

PhosAgro Celebrates 10-Year Anniversary of Its Listing on London Stock Exchange

 

Since its IPO in July 2011, PhosAgro has invested more than RUB 337 billion (around USD 6 billion*) on modernisation and the construction of new high-tech production facilities. This has helped bolster its leading position as the largest supplier of fertilizers to the Russia market and as the global leader in terms of production costs in the market for phosphate-based fertilizers. As a result of the Company's large-scale investment programme, the volume of fertilizer production has more than doubled, setting a record when production exceeded 10 million tonnes for the first time ever. The range of fertilizers produced has increased from 14 grades in 2011 to more than 50. Supplies to the Russian market - a strategic priority - of the Company's own mineral fertilizers have quadrupled to 2.9 million tonnes. From 2011 to 2020, PhosAgro Group's total tax payments exceeded RUB 115 billion (USD 2.3 billion). The Group's tax payments in 2021 are expected to exceed its 2011 payments by nearly fivefold. Annual expenditures on charity and social projects exceed RUB 4 billion. Total dividends since the IPO amounted to RUB 495 (USD 8.5) per GDR, which represents a return of more than 60% to the GDR price at IPO; While continuing to implement its large-scale investment programme, carry out its charity and social programmes and pay dividends to shareholders, the Company has maintained a stable financial position, as confirmed by leading rating agencies: Standard & Poor's, BBB-; Moody's, Baa3; and Fitch, BBB-. PhosAgro is one of a small number of companies around the world to have been granted LEAD status in the UN Global Compact, and it has received the highest ESG scores among its global peers and all Russian companies: Sustainalytics, 26.9; MSCI ESG Research, A; and CDP, B-.'

 

Moscow - PhosAgro (Moscow Exchange, LSE: PHOR), one of the world's leading vertically integrated phosphate-based fertilizer producers, is celebrating its 20th anniversary this year and the 10th anniversary of the listing of its shares and GDRs on the Moscow and London Stock Exchanges.

Throughout this entire period, PhosAgro has consistently enjoyed strong production and financial results, strived to balance the interests of all its stakeholders and demonstrated a commitment to the principles of sustainability and socially responsible business.

 

PhosAgro CEO Andrey A. Guryev said:

 

"PhosAgro's story is one of development and growth; an important milestone in this story was the Company's IPO in 2011. Despite the fact that, even before the IPO, we already occupied leading positions in domestic and world markets and set ourselves apart thanks to the high quality and wide range of our products, we have changed considerably and improved nearly every aspect of our operations over the past 10 years. Since the IPO, we have raised our standards for information disclosure and corporate governance, and we have become even more open and transparent in communication with our stakeholders.

 

"We are proud to talk about the Company's excellent results. Fertilizer production has more than doubled since 2011 and exceeded 10 million tonnes for the first time last year. Last year, we also increased our supply of our own mineral fertilizers to our key market, Russia, to more than 2.9 million tonnes for the first time in our 20-year history. Over the last 10 years, we have expanded our fertilizer product range from 14 grades to more than 50. Our flexible production model enables us to quickly adapt our product basket in response to external challenges in the economic environment.

 

"PhosAgro is a vertically integrated company whose business model covers all segments of the business: from the extraction of raw materials to logistics and the distribution of finished products. That's why we're able to meet 100% of our phosphate rock and phosphoric acid needs, 93% of our sulphuric acid needs and more than 80% of our ammonia needs. This has made us considerably more competitive.

"Our achievements are also reflected in our strong financial results. For example, we have enjoyed, for several years now, one of the highest EBITDA margins among our closest peers,and around half of our EBITDA is used to finance our investment programme: over the past 10 years, more than RUB 337 billion has been earmarked for investments. The Company also carries out social and charitable projects, allocating around RUB 4 billion for these purposes every year, and it complies with its dividend policy: our investors have received RUB 495 per GDR since the IPO.

 

"We pay special attention to sustainability issues. Our goal is to ensure global food security by supplying farmers all around the world with eco-efficient fertilizers that are free of levels of cadmium that are hazardous to soils and human health. PhosAgro is a recognised industry leader in terms of ESG. We have the highest ratings from reputable international agencies: Sustainalytics, 26.9; MSCI ESG Research, BBB; and CDP, B-.

 

"I am pleased to note all of our accomplishments and to acknowledge our commitment to international best practices in the industry, which we have demonstrated throughout our history. We plan to continue to pursue a growth strategy and to develop our business, delivering sustainable results for the benefit of our stakeholders."

 

Irina Bokova, a member of PhosAgro's Board of Directors and the Chair of the Board's Sustainable Development Committee, said:

 

"For me, as the Chair of the Sustainable Development Committee, it is especially laudable how the Company has improved its ESG practices over the past 10 years. At the moment, PhosAgro is one of the sustainability leaders in both the Russian and global markets: we are working to reduce carbon dioxide emissions, we are increasing the use of renewable energy sources, and we are expanding production of innovative products that minimise greenhouse gases. And, of course, we are accomplishing our main mission of providing farmers with eco-efficient fertilizers that do not contain dangerous concentrations of cadmium."

 

James Rogers, an independent director and member of the Board of Directors, said the following in congratulating the Company on its important milestone:

 

"PhosAgro has consistently demonstrated strong results: in just the last year, the Company's share price has increased by two-thirds, while production and supplies to the Russian market have reached record levels. I am confident that all of PhosAgro's achievements are a logical consequence of finding the right balance between its ambitious investment programme and regular dividend payments to shareholders. I believe that the Company will enjoy solid growth in 2021 and for a long time to come."

 

Andrey G. Guryev, Deputy Chairman of PhosAgro's Board of Directors of PhosAgro, said:

 

"PhosAgro's history proves that, when we went public 10 years ago, the right choice was made in opting for strict standards of corporate governance, corporate transparency and communications with investors and shareholders. During this time, PhosAgro has achieved impressive results and remained true to its commitments: we have quadrupled fertilizer supplies to Russian farmers and become a reliable guarantor of food security in Russia and in 102 countries around the world. The Company's achievements would not have been possible without our exceptional team of dedicated professionals."

 

Xavier R. Rolet, Chairman of PhosAgro's Board of Directors and an independent director, said:

 

"PhosAgro was complying with best corporate governance practices even before its IPO, but the Company has demonstrated considerable progress over the past 10 years. Since its IPO, the number of shares in PhosAgro's free float has doubled, and we have received high credit ratings. Currently, seven out of the 10 members of PhosAgro's Board of Directors are independent, and independent directors also chair five of the six Board committees. As in everything it does, PhosAgro doesn't plan to rest on its laurels; the Company is constantly developing and improving its corporate governance practices."

 

Julia Hoggett, CEO of the London Stock Exchange, also congratulated PhosAgro on the 10th anniversary of its public listing:

 

"PhosAgro is an excellent example of an issuer that has demonstrated a strong commitment to transparency and engagement with public-market investors. The London Stock Exchange pays a great deal of attention to sustainability issues. This year London Stock Exchange Group became the first global exchange to commit to a target of net-zero greenhouse gas emissions. We appreciate that PhosAgro also pays close attention to this issue and is making a significant contribution to the achievement of sustainable development goals. We wish the Company all the best on its journey as a public company."

 

Oleg Vyugin, Chairman of the Supervisory Board of Moscow Stock Exchange, said:

 

"I would like to congratulate the Company's staff, management and shareholders. We're proud of the fact that this successful company's stock is traded on our exchange. PhosAgro's operating and financial performance has consistently improved. Its share price has more than quadrupled since its initial listing, and the Company is now worth more than RUB 620 billion. PhosAgro's shares are included in our main index, the MOEX Russia Index, they're liquid, and investors working on Moscow Exchange have shown a great deal of interest in them. I would like to mention the high quality of the Company's corporate governance. This is important for investors, and it's also a key to the sustainability of the business. Also noteworthy is the fact that the Company pays close attention to environmental and social issues. I wish PhosAgro, its employees, management and shareholders continued success."

 

As part of the celebration of this milestone, we have prepared a video with statements by the following individuals:

 

Andrey A. Guryev, Chairman of the Management Board, CEO and member of the Board of Directors; Andrey G. Guryev, Deputy Chairman of the Board of Directors; Irina Bokova, member of the Board of Directors and Chair of the Sustainable Development Committee; Xavier R. Rolet, Chairman of the Board of Directors and an independent director; James Rogers, member of the Board of Directors and an independent director; Julia Hoggett, CEO of the London Stock Exchange; and Oleg Vyugin, Chairman of the Supervisory Board of Moscow Stock Exchange.

 

The video is available at the following link:

 

*Calculated according to the averaged weighted USD exchange rate.

 

About PhosAgro

 

PhosAgro (www.phosagro.com) is one of the world's leading vertically integrated phosphate-based fertilizer producers in terms of production volumes of phosphate-based fertilizers and high-grade phosphate rock with a P2O5 content of 39% and higher. PhosAgro's environmentally friendly fertilizers stand out for their high efficiency, and they do not lead to the contamination of soils with heavy metals.

 

The Company is the largest phosphate-based fertilizer producer in Europe (by total combined capacity for DAP/MAP/NP/NPK/NPS), the largest producer of high-grade phosphate rock with a P2O5 content of 39%, a top-three producer of MAP/DAP globally, one of the leading producers of feed phosphates (MCP) in Europe, and the only producer in Russia, and Russia's only producer of nepheline concentrate (according to the RAFP).

 

PhosAgro's main products include phosphate rock, more than 50 grades of fertilizers, feed phosphates, ammonia, and sodium tripolyphosphate, which are used by customers in 102 countries spanning all of the world's inhabited continents. The Company's priority markets outside of Russia and the CIS are Latin America, Europe and Asia.

 

PhosAgro's shares are traded on the Moscow Exchange, and global depositary receipts (GDRs) for shares trade on the London Stock Exchange (under the ticker PHOR). Since 1 June 2016, the Company's GDRs have been included in the MSCI Russia and MSCI Emerging Markets indexes.