Wednesday, May 21, 2014

K+S report Q1 2014

K+S, Q1, 2014, front page

The report was very well accepted and directly in the beginning the share price jumped up by 1.5%. During the day it then started moving slightly back again. So what was in the report then?

Please go here for the K+S report Q1 2014 in full. The highlights and outlook that they brought up can be seen below and what please me there was that demand is increasing and even better that the prices seems to have reached the bottom. The other good thing I like is that the revenue was ok in comparison to 2013. Back then the potash trouble had yet not started so the prices had not yet begun to fall and the reason why they did manage to keep up revenue well was due to increased sales of salt... but margins are lower there so earnings dropped. The outlook I like less. They even think that the revenues will drop in comparison to 2013 and I was hoping that the turn would start this year but the management does not think so and they know for sure better than me - so bad news.

K+S, highlights, outlook, Q1, 2014
If we dig into the key figures then we see that the revenue dropped by a little of -7% and for the Potash it dropped by almost -19%. Salt did pretty well due to much snow in the USA and therefor had increased sales of slightly over 4% compared to Q1 2013. The earnings per share was (and Q1 is their outstanding best quarter due to de-icing salt sales) 0.77 € in Q1 2014 compared to 0.99 € in Q1 2013. This is a decrease by more than -25% which is a lot and especially considering that they have an outlook of even decreased revenue compared to 2013.

K+S, key figures, Q1, 2014

Conclusion: The turnaround of K+S seems to take longer time than I thought but it neither changes my mind about the company as such or my ownership of it. So I will continue as a shareholder until at least the turnaround arrives but I will probably even stick around longer. Please go here for the previous analysis of K+S 2014.

No comments: