Resilience, Growth, Sustainability - Annual Report and Accounts 2010
1 Continuing to transform
our business
“Throughout its ten year history, EuroChem has earned a reputation as a responsible and successful company by investing in long-term sustainable growth and efficiency, and at the same time working to reduce our impact on the environment and to support the development of the communities where we operate.”
See more- What we have achieved in ten years
- Where we are today
- Where we are going
2 Thriving in a
vibrant marketplace
Feeding the world’s growing population is one of the most basic long-term challenges. These challenges were exacerbated in 2010 by extreme weather conditions in several important agricultural areas, including Russia, as well as underfertilization in 2009 as a consequence of the global financial crisis. Fertilizers are an important part of the solution. Currently, demand for fertilizers is very strong; at the same time, new production capacity coming on stream over the next few years means that we must constantly find ways to operate more efficiently to remain competitive with our global peers.
See more3 A dynamic business
delivering sustainable growth
Main strategic objectives
- Become a top five global fertilizer producer by EBITDA and volume in all three fertilizer segments (nitrogen, phosphate and potash) by growing faster than the market through investment in growth and M&A
- Maintain/increase cost advantage through vertical integration and investment in efficiency
4 The importance
of nitrogen
Nitrogen is one of the basic building blocks for life, and farmers require a steady supply of nitrogen fertilizers to ensure high-quality crop growth and yields. Nitrogen production capacity is relatively accessible due to the abundant supply of the main raw materials – natural gas and air.
See more5 The importance
of phosphates
Crops mature faster, making them more drought-resistant, with the help of phosphate fertilizers. EuroChem’s phosphate production is fully vertically integrated, with apatite rock from our Kovdorsky GOK mine supplying nearly all of the raw materials needs for our three phosphate plants in Russia and Lithuania.
See more6 The key value driver –
our potash story continues
Potash is known as ‘the quality nutrient’ because it helps to improve the taste and color of crops. For EuroChem, our investments at the Gremyachinskoe potash deposit are a top priority, which will help us to become one of just four major global producers with production capacity in all three nutrient groups.
See more7 Sustainability
at the core
EuroChem recognizes that superior shareholder returns can only be achieved by ensuring that the business is run in a sustainable and responsible way. Our view of sustainability involves ten key aspects of our operations:
See more8 Setting the
standards
Shareholding structure and influence
- EuroChem has adopted a robust approach to corporate governance in Russia
Transparency and disclosure
- IFRS reporting since 2002, audited by PwC
- Annual reports issued since 2005
- Financial statements and majority of corporate governance documents are publicly available on regularly-updated website
9 Looking
ahead
We are working hard to secure our future as the fourth producer of N, P and K fertilizers in the world, and reaching the top five by nutrient content and profitability. On the previous pages, we have given you a taste of how we plan to do this, and what we have achieved already. On the following pages, we will discuss our business in further detail.
See more10 Unlocking
growth
How EuroChem unlocks growth
- Smart investments to achieve flexible product portfolio and
cost-efficient production - Vertical integration to reduce dependency on Russia’s natural monopolies, and to decrease costs
- Commitment to investing in our employees, communities and the environment to secure sustainability
- Corporate governance and transparency at a level expected of an international public company
- Robust financial and risk management policies and systems to help management take informed, timely actions
Q&A with our CEO
Financial highlights
Net profit for 2010 stood at RUB 20.0bn, an 80% increase from the RUB 11.1bn we earned in 2009.
