Phosagro S Regulatory News (PHOR)

For Immediate Release 21 November 2013 PhosAgro Reports 9M 2013 IFRS Net Profit of RUB 9.1 bln Moscow - PhosAgro ("PhosAgro" or "the Company") (Moscow Exchange, LSE: PHOR),a leading global vertically integrated phosphate-based fertilizer producer,today announces its reviewed consolidated interim condensed IFRS financialstatements for the nine months ended 30 September 2013. PhosAgro earned a netprofit for the period of RUB 9.1 billion (USD 288 million), compared to RUB19.1 billion (USD 615 million) in 9M 2012. Basic and diluted earnings pershare came to RUB 64 (USD 2) for 9M 2013 compared to RUB 128 (USD 4) in 9M2012. 9M 2013 Financial and Operational Highlights: Result 9M 2013 9M 2012 year-on-year change (RUB vs. RUB), % USD RUB USD RUBRevenue 2,571 m 81,276 m 2,548 m 79,237 m 3%EBITDA* 629 m 19,897 m 874 m 27,194 m (27%)EBITDA margin 24% 24% 34% 34% (10 p.p.)Net Profit 288 m 9,094 m 615 m 19,120 m (52%)Earnings per 2 64 4 128 (50%)share Sales volumes Kmt KmtPhosphate-based 3,479.6 3,230.2 8%fertilizersNitrogen-based 930.6 787.8 18%fertilizersApatit mine and 3,034.0 3,311.7 (8%)beneficiationplantOther products 232.5 203.9 14% RUB/USD rates: average 9M 2013: 31.6170; average 9M 2012: 31.0984As of 30 September 2013: 32.3451; as of 31 December 2012: 30.3727*EBITDA is calculated as operating profit adjusted for depreciation andamortisation. Other 9M 2013 Highlights Production and sales flexibility: - During 9M 2013 PhosAgro's revenue and sales volumes benefited from theCompany's strategy of enhancing production flexibility, with total fertilizerproduction and sales showing significant year-on-year growth of 9% and 10%,respectively. Revenue for the same period increased by only 3% year-on-year asresult of: - a 14% decline in average DAP prices (FOB Tampa) and a 17% decline in averageurea prices (FOB Baltic); - a 5% year-on-year increase in revenue following the consolidation ofMetachem in December 2012, which brought sales of technical phosphates (STTP)and potassium sulphate (SOP) amounting to RUB 3,347 million (USD 106 million)in 9M 2013. Consolidation of ownership in production facilities: - In January 2013, the holders of 10.95% of shares in Apatit acceptedPhosAgro's mandatory tender offer; in April 2013, PhosAgro sent a compulsoryshare purchase notification (squeeze out) to Apatit for the buyout of sharesbelonging to Apatit minority shareholders. As of 30 September 2013, theholders of 4.05% of all issued shares of Apatit had accepted PhosAgro's sharepurchase notification; in addition to the squeeze-out, the Company purchased76% of Nordic Rus Holding, which owns 7.42% of Apatit, bringing PhosAgro'sownership in the subsidiary to 100%; - In June 2013, PhosAgro acquired 25.24% of Metachem, bringing its ownershipin the subsidiary to 100%; - In August 2013, PhosAgro acquired 100% of PhosInt Trading Limited, whichowns 100% PhosAgro Asia Pte Ltd. PhosAgro Asia Pte Ltd will be PhosAgro'sfirst trading operation in Asia, and will focus on international sales ofmineral fertilizers in the region. PhosAgro reported its 9M 2013 net profit of RUB 9.1 billion (USD 288 million),a decrease of 52% year-on-year from RUB 19.1 billion (USD 615 million) in 9M2012. Revenue for the period was up 3% year-on-year to RUB 81.3 billion (USD2,571 million), compared to RUB 79.2 billion (USD 2,548 million) for 9M 2012. Operating profit for 9M 2013 was RUB 14.1 billion (USD 447 million), a 37%decrease from RUB 22.4 billion (USD 721 million) in 9M 2012. EBITDA margindecreased year-on-year to 24%, compared to 34% for 9M 2012. Cash flow from operating activities amounted to RUB 15.9 billion (USD 502million) in 9M 2013, compared to RUB 21.7 billion (USD 699 million) in 9M2012. The Company's capital expenditure (capex) in cash terms during the ninemonths ended 30 September 2013 was RUB 13.1 billion (USD 414 million),compared to RUB 9.7 billion (USD 313 million) in 9M 2012. Net debt at 30 September 2013 stood at RUB 39.7 billion (USD 1,228 million),up from RUB 26.8 billion (USD 883 million) at 31 December 2012. Net debtincreased due to a significant cash outflow for the Apatit minorityshareholder buy-out, which was funded through PhosAgro's successful long-termUSD 500 million debut Eurobond issue. Unfavourable market conditions alsocontributed to the increase in net debt. As a result, the Company's net debtto annualised EBITDA ratio increased to 1.5 as of 30 September 2013. Excludingthe effect of Apatit buyout (under normal course of business), netdebt/annualised EBITDA would be 1.1 as of 30 September 2013. Commenting on the 9M 2013 results, PhosAgro Management Board Chairman and CEOAndrey A. Guryev said: "In the first nine months of 2013 we have increased revenue by 3% year-on-yearas a result of growth in fertilizer production and sales by 9% and 10%,respectively. DAP prices remain under significant pressure for the third yearin a row, with FOB Tampa prices dropping another 21% from USD 493 per tonne atthe beginning of the year to USD 390 per tonne as of the end of September2013, and with a further decrease to just around USD 350 per tonne today. Thishas brought most of our industry to below break-even levels. I am pleased thatwe have managed to generate a 24% EBITDA margin at such challenging times, andto maintain almost 100% production capacity utilisation. "Despite challenging market conditions, we have achieved several strategicgoals with respect to consolidation of our production subsidiaries during theperiod: we completed the Apatit minority squeeze out and now own 100% of thisunique mining asset. We also made progress on further organic growth with thelaunch of construction of a new modern ammonia plant. This plant will help tosustain our low cost advantage in the future and establish a base for thedevelopment of further downstream fertiliser capacity aimed at delivering anytype of phosphate-based fertilizer to farmers in either concentrated orcomplex triple (NPK) and even quadruple (NPKS) nutrient form." 9M 2013 Market Conditions - Weak demand from India, the world's largest DAP market, combined withcontinued declines in the rupee vs. the US dollar, put downward pressure onDAP/MAP prices; - The average DAP price per tonne for 9M 2013 fell 14% to USD 467 (FOB Tampa),compared to USD 540 (FOB Tampa) in January-September 2012; - According to CRU and Fertecon, India imported 2.7 mln tonnes of DAP in thefirst 9 months of 2013, compared to 4.9 mln tonnes in 9M 2012; - Uralkali's new sales strategy, following its exit from BPC, has had anegative impact on all three nutrients and caused stagnation on globalfertilizer markets, resulting in further significant decreases in prices forall fertilizers: from 30 July 2013, DAP has decreased another 23% from USD 455(FOB Tampa) to just slightly above USD 350 as of the date of this release; - Weakness in the global phosphate-based fertilizer market has led producersto curtail production. According to Argus FMB and Fertecon, OCP has decreasedits capacity utilisation to 50%-60%, while in China capacity utilisation is at50%-70% according to CFMW; - DAP exports from China in January-September 2013 were 2.3 mln tonnes, 15%lower than the 2.7 mln tonnes exported in 9M 2012. China's totalphosphate-based fertilizer exports for 9M 2013 decreased 18% (800 ths tonnes)year-on-year and amounted to 3.6 mln tonnes, compared to 4.4 mln tonnes in 9M2012; - Despite the decline in feed stock prices, during the first nine months of2013 DAP spot prices remained below cash cost levels for marginal producers ofconcentrated phosphate fertilizers , and are currently below the average cashcost for the industry. Phosphate-based products segment Result 9M 2013 9M 2012 year-on-year RUB mln RUB mln change, %Revenue 70,926 68,948 3%Cost of goods sold (47,336) (42,521) 11%Gross profit 23,590 26,427 (11%) Phosphate-based products segment revenue increased by 3% year-on-year andtotalled RUB 70,926 million (USD 2,243 million) in 9M 2013. PhosAgro increasedproduction of phosphate-based fertilizers and MCP by 6% year-on-year in ninemonths of 2013, while sales volumes were up 8% year-on-year. Production andsales volumes for phosphate rock and nepheline concentrate decreased in 9M2013 compared to 9M 2012 by 0.2% and 8%, respectively. Revenue growth for the phosphate-based products segment was largely due to theaddition in 9M 2013 of export sales of STTP (sodium tripolyphosphate) and SOP(potassium sulphate) of RUB 2,494 million (USD 79 million) and 701 (USD 22million), respectively, following the consolidation of Metachem at the end of2012. Revenue from NPK export sales decreased by 17% year-on-year, from RUB12,334 million (USD 397 million) in 9M 2012 to RUB 10,200 million (USD 323million) in 9M 2013. This was mainly the result of a 13% decline in revenueper tonne from export sales of NPK. Revenue from DAP/MAP sales decreased by 1%year-on-year from RUB 25,680 million (USD 826 million) in 9M 2012 to 25,399million (USD 803 million) in 9M 2013. This small decrease was due to lowermarket prices counterbalancing an 11% increase in DAP/MAP sales volumes.Revenue from domestic sales of phosphate rock decreased by 17% year-on-year toRUB 6,425 million (USD 203 million) in 9M 2013 due to higher internal usefollowing the consolidation of Metachem and lower sales to a significantRussian customer; these volumes were redirected to export markets, which ledto an 18% year-on-year increase in export sales of the product to RUB 7,142million (USD 226 million) for the period. The phosphate segment's gross profit for 9M 2013 decreased by 11% year-on-yearto RUB 23,590 million (USD 746 million), resulting in a gross profit margin of33%, compared to 38% in 9M 2012. This was primarily the result of a decreasein prices for the Company's main phosphate-based products. PhosAgro is largely self-sufficient in key raw materials for phosphatefertilizer production, and therefore is not subject to price inflation forphosphate rock. However, higher production volumes and changes in theproduction mix in 9M 2013 meant the Company had to increase external purchasesof other inputs, which led to an increase in cost of sales (a more detaileddiscussion is provided in the CoGS analysis below). Revenue per tonne for the principal phosphate-based fertilizers and feedphosphate Product 9M 2013 9M 2012 year-on-year RUB RUB change, %Domestic:MAP 15,589 18,901 (17.5%)DAP 15,068 17,752 (15.1%)NPK 14,149 14,640 (3.4%)MCP 19,952 19,368 3%NPS 11,438 12,217 (6.4%) Export:MAP 15,329 16,902 (9.3%)DAP 15,040 16,687 (9.9%)NPK 12,363 14,215 (13%)MCP 17,520 17,070 2.6%NPS 10,487 12,050 (13%)Nitrogen segment Result 9M 2013 9M 2012 year-on-year RUB RUB change, %Revenue 9,802 9,571 2%Inter-segment revenues 1,119 2,826 (60%)Cost of goods sold (7,171) (5,645) 27%Gross profit 3,750 6,752 (44%) Nitrogen segment revenue was RUB 9,802 million (USD 310 million) in 9M 2013,an increase of RUB 231 million year-on-year from RUB 9,571 million (USD 308million) in 9M 2012. Production and sales volumes of nitrogen-basedfertilizers increased by 17% and 18% year-on-year, respectively, in 9M 2013. Urea sales volumes increased by 28% year-on-year following the launch of thenew urea plant at PhosAgro-Cherepovets in the second half of 2012. Exportrevenue from urea increased by 18% year-on-year from RUB 5,645 million (USD182 million) in 9M 2012 to RUB 6,681 million (USD 211 million) in 9M 2013 as aresult of higher export sales volumes (up 27%) and a 7% decrease in exportrevenue per tonne. Ammonium nitrate (AN) sales volumes have decreased by 21%,which was the major factor behind the 17% decrease in revenue from AN salesfrom RUB 2,374 million (USD 75 million) in 9M 2012 to RUB 1,941 million (USD61 million) in 9M 2013, which was partially compensated by a 17% increase indomestic prices. Inter-segment revenues decreased by 60% year-on-year in the first nine monthsof 2013, to RUB 1,119 million (USD 35 million). This was a result of themerger of Ammophos and Cherepovetskiy Azot, which represented thephosphate-based and nitrogen-based segments, respectively, prior to theirmerger into PhosAgro-Cherepovets. As a result of higher expenses for purchased ammonia (a more detaileddiscussion is provided in the CoGS analysis below), nitrogen segment grossprofit decreased by 44% year-on-year to RUB 3,750 million (USD 119 million) in9M 2013, with a gross profit margin of 34%, compared to 54% in 9M 2012. Revenue per tonne for the principal nitrogen-based fertilizers Product 9M 2013 9M 2012 year-on-year RUB mln RUB mln change, %Domestic:Ammonium nitrate 9,852 8,399 17.3%Urea 12,959 12,458 4% Export:Ammonium nitrate 9,591 10,395 (7.7%)Urea 10,868 11,701 (7.1%)Cost of sales PhosAgro's cost of sales increased by 18% year-on-year in 9M 2013 to RUB52,713 million (USD 1,667 million), in line with the growth in fertilizersales volumes of 10%, PPI inflation of 3.7% year-on-year from 9M 2012 to 9M2013, and a 4% increase resulting from the consolidation of Metachem. Thisincrease in cost of sales was primarily due to the following changes from 9M2012 to 9M 2013: - A RUB 2,229 million (USD 71 million) or 17% increase in the costof materials and services. The consolidation of Metachem into PhosAgro led toan increase in materials and services expenses of 7%, or RUB 897 million (USD28 million). The growth in fertilizer sales volumes by 10% led to higherconsumption of related materials and services. - Higher production of NPS/NPK, which have a high nitrogen content,led to an increase in purchases of ammonium sulphate of RUB 510 million (USD16 million). - A RUB 1,709 million (USD 54 million) or 86% increase in ammoniaexpenses, mainly due to maintenance and debottlenecking of ammonia productionfacilities in August-September 2013 (which has increased annual productioncapacity by 50 thousand tonnes), which in turn led to higher purchases ofammonia from third parties. Higher production volumes of nitrogen-basedfertilizers and changes in the product mix also meant that PhosAgro's thirdparty ammonia purchases increased to RUB 3,687 million (USD 117 million) inthe nine months ended 30 September 2013 from RUB 1,978 million (USD 64million) in the nine months ended 30 September 2012. - An increase in expenditure on natural gas of RUB 293 million (USD9 million), or 7%, to RUB 4,353 million (USD 138 million) in the nine monthsended 30 September 2013. Natural gas is required primarily for the productionof ammonia. The price per cubic meter of natural gas rose by 12%, whilenatural gas consumption decreased by 5% year-on-year. The price increase wasdue to an approximately 15% tariff increase in the second half of 2012. Thedecrease in volume was due to the maintenance of ammonia production facilitiesduring August-September of 2013. - An increase in expenditure on electricity of RUB 192 million (USD6 million), or 8%, from RUB 2,382 million (USD 77 million) in 9M 2012 to RUB2,574 million (USD 81 million) in 9M 2013. This was mainly due to theconsolidation of Metachem. - Personnel costs increased 23% year-on-year, primarily due to thefollowing reasons: indexation of salaries, an approximately 4% increase due tothe consolidation of Metachem, as well as an increase in Russian socialpayments and redundancy payments with respect to the staff optimizationprogramme. - The increase in cost of sales was partially offset by ayear-on-year decrease in expenditure on potash of 8%, or RUB 297 million (USD9 million), to RUB 3,416 million (USD 108 million) in the nine months ended 30September 2013. This was mainly due to a 9% decrease in potash purchasevolumes. Although production volumes of NPK increased by 2%, the share of NPKbrands with low potash content in the overall production mix increased. Item 9M 2013 9M 2012 Change y-on-y RUB USD % of RUB USD % of RUB % mln mln cost mln mln cost mln of sales of sales Materials and 15,467 489 29% 13,238 426 30% 2,229 17%servicesSalaries and 10,264 325 19% 8,357 269 19% 1,907 23%socialcontributionsAmmonia 3,687 117 7% 1,978 64 4% 1,709 86%Potash 3,416 108 6% 3,713 119 8% (297) (8%)Ammonium sulphate 892 28 2% 382 12 1% 510 134%Natural gas 4,353 138 8% 4,060 131 9% 293 7%Depreciation and 5,307 168 10% 4,369 140 10% 938 21%amortisationFuel 3,284 104 6% 3,277 105 7% 7 0%Sulphur and 2,812 89 5% 2,720 87 6% 92 3%sulphuricacidElectricity 2,574 81 5% 2,382 77 5% 192 8%Other items 49 2 0% 50 2 0% (1) (2%)Change in stock of 608 19 1% 310 10 1% 298 96%WIP and finishedgoodsTotal 52,713 1,667 100% 44,836 1,442 100% 7,877 18% Administrative expenses rose by 17% year-on-year to RUB 5,548 million (USD 175million) in the first nine month of 2013 primarily as a result of: inflation,consolidation of Metachem and increased medical insurance coverage. Selling expenses rose by 7% year-on-year, from RUB 5,695 million (USD 183million) in the first nine month of 2012 to RUB 6,080 million (USD 192million) in the first nine month of 2013. This was primarily due to highersales volumes, as well as a 7% year-on-year increase in Russian Railwaysinfrastructure tariff and operators' fees in 9M 2013. Cash spent on capex in 9M 2013 amounted to RUB 13,086 million (USD 414million), compared to RUB 9,719 million (USD 313 million) in the first ninemonths of 2012. PhosAgro's capital expenditure, which consists of additions toproperty, plant and equipment, amounted to RUB 12,150 million (USD 384million) for 9M 2013, compared to RUB 10,707 million (USD 344 million) in 9M2012. Capital expenditure focused on construction of the main ore shaft â"- 2at the Kirovsky underground mine (expected to enable the mine to increaseproduction to 14 mtpa in 2-3 years), the construction of new storagefacilities for liquid ammonia at Balakovo Mineral Fertilizers, and the newammonia plant now being built at PhosAgro-Cherepovets. Total debt at 30 September 2013 amounted to RUB 48,516 million (USD 1,500million), compared to RUB 36,469 million (USD 1,201 million) at 31 December2012. Net debt at 30 September 2013 amounted to RUB 39,712 million (USD 1,228million), compared to RUB 26,805 million (USD 883 million) at 31 December2012. Outlook Market: - Stabilisation of potash prices is expected to revive demand for NPKfertilizers and push purchases of all nutrients; - Despite lower prices, global agricultural commodities market trends remainpositive. The current cereals basket price is at a level that has historicallybeen equivalent to DAP prices being at a point USD 100 per tonne higher thanwhere they currently are; - Record accessibility of phosphate-based fertilizers should support greaterseasonal demand from North America and Western Europe in early 2014, and mayalso push advance purchases by other markets; - India's low import volumes this year combined with favourable weatherconditions and higher demand in the current Rabi season will draw downstockpiles and help restart import demand for DAP and NPK earlier; á New phosphoric acid and MAP/DAP capacities in the Middle East and NorthernAfrica have once again been delayed to next year (now two years behind plan). Company: - While concentrated phosphate fertilizer demand remained under pressure in 9M2013, PhosAgro sees very high global demand for complex fertilizers and NPS;the Company intends to further invest into both increasing capacity andexpanding the number of NPK grades it produces; - All major development projects are on track: the new ammonia plant designedto increase cost efficiency and support expansion of complex fertilizercapacity, as well as new PK/NPK/NPKS production projects; - Following the full consolidation of Apatit shares, PhosAgro will focus onconsolidating its ownership of PhosAgro-Cherepovets in 4Q 2013 Ð 1Q 2014; - Management focus on cost optimisation will help to reduce the Company'smaterial and personnel costs in addition to recent ammonia, sulphur and potashprice developments; - The Management Board is revising the capital expenditure programme to complywith PhosAgro's financial policy with respect to capital spending andleverage. On 21 November 2013, PhosAgro will hold a conference call and webcast at 13:30London time (17:30 Moscow; 08:30 New York). Following a presentation of the results, PhosAgro CEO Andrey A. Guryev willanswer questions from conference call participants. The call will be held in English, with simultaneous translation into Russianon a separate line. Participants will be required to tell the operator whichlanguage to connect to when dialling in. Webcast links: English: http://www.media-server.com/m/p/y9jo4tqq/lan/enRussian: http://www.media-server.com/m/p/y9jo4tqq/lan/ru Conference call dial-ins: +7 499 272 4337 Moscow+1 212 999 6659 New York+44 (0) 20 3003 2666 London Toll Free: 0808 109 0700 UK1 866 966 5335 USA8 10 8002 490 2044 Russia (Moscow only) Conference call password: PhosAgro For further information please contact: OJSC PhosAgroIrina Evstigneeva, Head of Corporate Finance and Investor Relationsir@phosagro.ru+7 495 231 3115 Timur Belov, Press Officer+7 495 232 9689 EM Sam VanDerlipvanderlip@em-comms.com+44 7554 993 032+7 916 306 6112 Notes to Editors PhosAgro is one of the leading global vertically integrated phosphate-basedfertilizer producers. The Company focuses on the production of phosphate-basedfertilizers, feed phosphate and high-grade phosphate rock (P2O5 content of notless than 39%), as well as ammonia and nitrogen-based fertilizers. The Companyis the largest phosphate-based fertilizer producer in Europe, the largestproducer of high-grade phosphate rock worldwide and the second largest MAP/DAPproducer in the world (excluding China), according to Fertecon. PhosAgro has 2.1 billion tonnes of resources (according to JORC as of 1 June2011) of high quality apatite-nepheline ore, representing over 75 years ofproduction (at current production levels). The Company also controlssubstantial Al2O3 resources, and has more than 41% of Russia's rare earthoxides resources. The Company's mines and phosphate rock production facilities are located inthe mountainous areas of the Kola Peninsula in the Murmansk region ofnorthwest Russia, whereas its fertilizer and feed phosphate production assetsare located near the city of Cherepovets in the Vologda region and near thecity of Balakovo in the Saratov region of southwest part of European Russia.PhosAgro's 2012 IFRS revenue was over USD 3.4 bln and EBITDA was USD 1.1 bln.The Company's net debt/EBITDA ratio was 0.77 at 31 December 2012. For further information on PhosAgro please visit: www.PhosAgro.com Consolidated Interim Condensed Statement of Profit or Loss and OtherComprehensive Income for the nine months ended 30 September 2013 (unaudited) Nine months ended Three months ended 30 September 30 September 2013 2012 2013 2012 RUB Million RUB Million RUB Million RUB MillionContinuing operationsRevenues 81,276 79,237 27,561 28,878Cost of sales (52,713) (44,836) (18,041) (16,411)Gross profit 28,563 34,401 9,520 12,467 Administrative expenses (5,548) (4,723) (1,891) (1,790)Selling expenses (6,080) (5,695) (2,003) (1,748)Taxes, other than income tax (1,657) (1,169) (575) (402)Other expenses, net (1,157) (386) (534) (25)Operating profit 14,121 22,428 4,517 8,502 Finance income 831 1,814 332 699Finance costs (1,661) (1,109) (511) (540)Foreign exchange (loss)/gain (2,517) 1,074 242 1,763Share of (loss)/profit of associates (87) 117 (269) 28Profit before tax 10,687 24,324 4,311 10,452 Income tax (expense)/benefit (1,863) (5,204) 26 (2,134)Profit from continuing operations 8,824 19,120 4,337 8,318 Discontinued operationsProfit/(loss) from discontinued operations, net of tax 270 - (13) -Profit for the period 9,094 19,120 4,324 8,318 Attributable to:Non-controlling interests * 915 3,205 364 859Shareholders of the Parent 8,179 15,915 3,960 7,459 Other comprehensive incomeRevaluation of available-for-sale securities - (307) - (319)Recycling of revaluation loss on available-for-sale securities to profit and loss - - - (369)Actuarial gains and losses, net of tax (132) (131) (64) (68)Foreign currency translation difference 186 (260) 44 (622)Other comprehensive income for the period 54 (698) (20) (1,378)Total comprehensive income for the period 9,148 18,422 4,304 6,940 Attributable to:Non-controlling interests * 903 3,181 358 856Shareholders of the Parent 8,245 15,241 3,946 6,084Basic and diluted earnings per share (in RUB) 64 128 31 60 Consolidated Interim Condensed Statement of Financial Position as at 30September 2013 (unaudited) 30 September 2013 31 December 2012 RUB million RUB millionAssetsProperty, plant and equipment 72,643 66,528Intangible assets 481 553Investments in associates 8,313 9,620Other non-current assets 5,584 3,071Non-current assets 87,021 79,772 Other current investments 1,804 833Derivative financial assets 44 45Inventories 11,776 12,324Current income tax receivable 472 769Trade and other receivables 11,651 11,874Cash and cash equivalents 8,804 9,664Assets held for sale, net 31 346Current assets 34,582 35,855Total assets 121,603 115,627 EquityShare capital 372 360Share premium 7,494 1,099Retained earnings 50,930 48,294Other reserves (201) (267)Equity attributable to shareholders of the Parent 58,595 49,486Equity attributable to non-controlling interests 3,176 12,389Total equity 61,771 61,875 LiabilitiesLoans and borrowings 30,430 14,452Defined benefit obligations 1,322 1,257Deferred tax liabilities 1,876 2,973Non-current liabilities 33,628 18,682 Trade and other payables 7,421 12,377Current income tax payable 697 676Loans and borrowings 18,086 22,017Current liabilities 26,204 35,070Total equity and liabilities 121,603 115,627 Consolidated Interim Condensed Statement of Cash Flows for the nine monthsended 30 September 2013 (unaudited) Nine months ended 30 September 2013 2012 RUB million RUB millionCash flows from operating activitiesProfit before tax from continuing operations 10,687 24,324Adjustments for:Depreciation and amortisation 5,776 4,766Loss/(gain) on disposal of fixed assets 188 (224)Finance income (831) (1,814)Finance costs 1,661 1,109Share of loss/(profit) of associates 87 (117)Foreign exchange loss/(gain) 3,039 (980)Operating profit before changes in working capital and provisions 20,607 27,064Decrease in inventories 640 317Decrease/(increase) in trade and other receivables 1,111 (133)Decrease in trade and other payables (2,498) (165)Cash flows from operations before income taxes and interest paid 19,860 27,083Income tax paid (2,643) (4,275)Finance costs paid (1,352) (1,068)Cash flows from operating activities 15,865 21,740 Cash flows from investing activitiesLoans repaid, net 505 143Acquisition of intangible assets (77) (63)Acquisition of property, plant and equipment (13,086) (9,719)Proceeds from disposal of property, plant and equipment 241 446Cash of PhosInt Trading Ltd and PhosAgro Asia Pte Ltd acquired 1,143 -Cash paid for CJSC "Nordic Rus Holding" (1,680) -Proceeds from disposal of CJSC "Pikalevskaya soda" and part ofmanufacturing facilities within LLC "Metachem" 599 -Acquisition of investments, net (258) (8)Additional equity contribution in associates - (400)Finance income received 775 947Cash flows used in investing activities (11,838) (8,654) Cash flows from financing activitiesProceeds from issuance of additional shares 6,407 -Proceeds from borrowings 31,582 18,651Repayment of borrowings (24,656) (14,301)Acquisition of non-controlling interests (11,674) (367)Dividends paid to non-controlling interests (5) (362)Dividends paid to shareholders of the Parent (5,488) (7,628)Finance leases paid (1,183) (615)Cash flows used in financing activities (5,017) (4,622)Net (decrease)/increase in cash and cash equivalents (990) 8,464Cash and cash equivalents at 1 January 9,664 16,946Effect of exchange rates fluctuations 130 (204)Cash and cash equivalents at 30 September 8,804 25,206