Acron Group’s Commercial Output Up 4.5% in Q1 2021

22 April 2021

Acron Group’s Commercial Output Up 4.5% in Q1 2021

Group’s consolidated output (including operating results for Acron, Dorogobuzh and

North-Western Phosphorous Company)

Product, ‘000 t	Q1 2021	Q1 2020	YOY, %
MINERAL FERTILISERS
Ammonia	688	677	1.6
incl. in-house consumption	677	634
Nitrogen fertilisers, including	1,170	1,114	5.0
incl. in-house consumption	170	170
AN	575	604	-4.8
incl. in-house consumption	46	53
Urea	319	245	30.3
incl. in-house consumption	124	117
incl. prilled urea	56	131	-57.1
incl. in-house consumption	5	3
incl. granulated urea	151	0	increase
incl. in-house consumption	7	0
UAN	276	265	4.1
Complex fertilisers, including	611	618	-1.1
incl. in-house consumption	8	9
NPK	584	590	-1.0
incl. in-house consumption	8	9
Bulk blends	27	28	-4.8
Total commercial output for Mineral Fertilisers	1,615	1,596	1.2
INDUSTRIAL PRODUCTS
Organic compounds, including	118	112	5.2
incl. in-house consumption	62	55
Methanol	26	27	-5.3
incl. in-house consumption	23	20
Formalin	42	40	6.0
incl. in-house consumption	38	35
Urea-formaldehyde resins	50	45	10.8
incl. in-house consumption	1	1
Non-organic compounds, including	290	249	16.5
Low-density and technical-grade AN	125	78	61.0
Industrial urea	41	45	-8.9
Calcium carbonate	111	113	-2.1
Liquid carbon dioxide	12	12	-0.8
Argon	2	2	-6.3
Total commercial output for Industrial Products	346	306	13.2
PHOSPHATE INPUTS
Apatite concentrate	313	256	22.5
incl. in-house consumption	238	209
Total commercial output for Apatite Concentrate	75	47	60.6
TOTAL COMMERCIAL OUTPUT	2,035	1,948	4.5

Note: Commercial output is output less in-house consumption.

Comments from Chairman of Acron’s Board of Directors Alexander Popov:

‘In the first quarter of 2021, Acron Group produced 2,035,000 tonnes of its main commercial products. This is the third straight quarter that our commercial output has exceeded 2 million tonnes.

‘The capacity-building projects completed in the past year have already delivered positive outcomes: ammonia output increased 2%, and urea output was up 30%. It is particularly satisfying that granulated urea output at the new unit put on stream in May 2020 is still growing, reaching 151,000 tonnes in the reporting period.

‘We continue to focus on progressive development, with plans to further increase our commercial output. Construction of the Urea-6+ unit is underway, with expected commissioning in the second quarter of 2021. This new unit will add 520,000 tonnes of urea per annum to our total urea capacity.

‘Today, almost all of the ammonia produced by Acron Group is processed in-house into finished products with high added value, so we are implementing projects to boost capacity at the Ammonia-2 and Ammonia-3 units in Veliky Novgorod. Once these two units are upgraded using the best available technology in 2023, they will provide all of the ammonia required by our Novgorod–based facility’.

Market Trends

Global urea prices grew rapidly in Q1 2021. Baltic FOB prices reached a seven-year record-high of USD 350. This sharp rise was driven by several factors, including strong seasonal demand in Europe and the United States, limited urea volume available for export from China, an increase in global prices for natural gas, and record-high grain prices. India’s urea purchases give additional support to the market. However, the end of the high season in Europe and the United States and the expansion of Chinese exports may cause an excess of supply on the market, which could grow further this year with the commissioning of new production facilities in Africa and India.

In Q1 2021, AN and UAN prices also increased to their highest level in several years due to strong seasonal demand in the Northern Hemisphere and growth in urea prices used as a benchmark for other nitrogen fertiliser prices.

NPK prices increased in Q1 2021 as well, mainly driven by higher prices for basic products (urea, DAP, and potassium chloride). The increase in basic product prices outstripped blends because of their higher liquidity, so the NPK 16-16-16 premium over the basic product basket decreased to 5% from the historical average of 20%.

Average Indicative Prices, USD per t, FOB Baltic/Black Sea

	Q1 2021	Q4 2020	Q1 2020	Q1 2021/ Q4 2020 change	Q1 2021/ Q1 2020 change
NPK 16-16-16	312	262	252	19%	24%
AN	234	166	187	41%	25%
UAN	213	119	123	79%	73%
Urea	326	234	217	39%	50%
Ammonia	329	211	222	56%	48%

Media Contacts:

Sergey Dorofeev

Anastasia Gromova

Tatiana Smirnova

Public Relations

Phone: +7 (495) 777-08-65 (ext. 5196)

Investor Contacts:

Ilya Popov

Investor Relations

Phone: +7 (495) 745-77-45 (ext. 5252)

Background Information

Acron Group is a leading vertically integrated mineral fertiliser producer in Russia and globally, with chemical production facilities in Veliky Novgorod (Acron) and Smolensk region (Dorogobuzh). The Group owns and operates a phosphate mine in Murmansk region (North-Western Phosphorous Company, NWPC) and is implementing a potash development project in Perm Krai (Verkhnekamsk Potash Company, VPC). It owns transportation and logistics infrastructure, including three Baltic seaport terminals and distribution networks in Russia and China. Acron subsidiary North Atlantic Potash Inc. (NAP) holds mining leases and an exploration permit for ten parcels of the potassium salt deposit at Prairie Evaporite, Saskatchewan, Canada. Acron also holds a minority stake (19.8%) in Polish Grupa Azoty S.A., one of the largest chemical producers in Europe.

In 2020, the Group sold 7.8 million tonnes of main products to 74 countries, with Russia, Brazil, Europe and the United States as key markets.

In 2020, the Group posted consolidated IFRS revenue of RUB 119,864 million (USD 1,661 million), with EBITDA of RUB 35,311 million (USD 489 million). Acron’s shares are traded on the Moscow Exchange and its global depositary receipts are traded at the London Stock Exchange (ticker AKRN). Acron employs over 11,000 people.

For more information about Acron Group, please visit www.acron.ru/en.