German fertiliser group K+S reports falling profits

K+S, the German fertiliser manufacturer, said on Thursday it expected sales and profits to fall this year after a difficult 2013. "The year 2013 was associated with great challenges for the K+S group," said chief executive Norbert Steiner. Net profit tumbled 18.8 percent to 437.1 million euros ($609 million) in 2013. Underlying or operating profit was down 18.4 percent at 655.9 million euros while revenues were more or less stable, inching 0.4 percent higher to 3.950 billion euros. K+S said business was hurt by falling prices for potassium chloride after Russian group Uralkali said it would expand capacity regardless of prices. Looking ahead to the current year, K+S said potash prices "appeared to bottom out at the start of 2014." With the sales volume for the potash and magnesium products division expected to stay the same, "average prices over the course of the year should be tangibly lower than in the preceding year." Revenues "should therefore be moderately below the figure for the previous year," the company said. "Taking into account the high proportion of fixed costs customary in mining, it can be assumed that operating earnings will be down significantly on the figure for the previous year," it said. And net profit "should follow the trend in operating earnings and thus also be significantly lower than in the previous year," K+S concluded. The outlook weighed on K+S share prices and K+S shares were the biggest losers on the Frankfurt stock exchange on Thursday, shedding as much as 6.90 percent in an unchanged market.