Karnalyte Resources Inc. has announced its financial results and corporate highlights for the 2019 financial year.In 2019, Karnalyte continued to make progress in investigating the economic and technical viability of its proposed Proteos nitrogen project. Karnalyte also continued to prepare its Wynyard potash project for improvement in market conditions such that when this project becomes economically viable, it could be advanced to the next development stage.The company continues to move towards the development of the Wynyard potash project as well as conclude some preliminary investigation of the viability of the Proteos nitrogen project.
For the Wynyard potash project, the company plans to continue to optimise the project costs with a view to re-activating the development of the project if an improving potash price environment results in the Wynyard potash project becoming economically viable and financeable.For the Proteos nitrogen project, the company plans to complete the pre-feasibility study for the project with a view towards making a decision on how to take the project forward including exploring and securing an offtake partner. The company continues to have discussions with a number of agricultural industry participants who have shown interest in the project.
Karnalyte Resources Inc. exercised fiscal restraint in 2019 as it continued to wait for the potash price environment to improve before proceeding with further development of the Wynyard potash project. The costs incurred by the company in 2019 related to further cost optimisation of the Wynyard project and revalidation of certain technical aspects of the project as well as further investigation and evaluation of the Proteos nitrogen project. As a result, at 31 December 2019, the company had cash of CAN$7.5 million, a positive working capital of CAN$7.2 million, and no debt. The company had adequate cash to fund all existing commitments in 2019. Furthermore, the company has sufficient cash to meet short term operating and capital requirements.
Also the Russia-headquartered Acron Group has released its audited consolidated IFRS financial statements for 2019. The company’s sales in 2019 hit a record high of 7.6 million t, and the sales geography expanded to cover 78 countries worldwide where the Group implemented several investment projects. The ammonia unit upgrades at Dorogobuzh and construction of the nitric acid unit in Veliky Novgorod were completed and operate efficiently. Another two major projects – urea granulation to be commissioned in 2Q20, and the construction of the Urea-6+ unit to be completed in early 2021 – entered the active implementation stage. In 2019, the Acron Group made capital investments of US$294 million, its maximum amount for the last five years.
Despite these overal positive results, “declining global mineral fertiliser prices in the second half of the year affected the Group’s financial performance,“ Alexander Popov, Chair of Acron’s Board of Directors, commented. „To address this situation, we decided to slow down implementation of the investment programme and refrain from taking on any new projects until the market recovers. This step will help us temporarily minimise CAPEX and prevent the debt burden from increasing, while meeting performance targets in terms of both operations and dividends. In 2019, the Group allocated US$221 million in dividends”.
