Makhteshim Agan Industries Ltd. today reported lower net profit on higher revenue for the first quarter of 2012.
Revenue rose 6% to $828 million for the first quarter from $780.5 million for the corresponding quarter of 2011. Most of the growth stemmed from an improved mix of products and an increase in sales volumes. The rise in the price of oil and raw materials since 2011 resulted in higher selling prices in the crop protection sector, which allowed Makhteshim to also raise its prices.
Gross profit rose 12% to $286.9 million (34.6% of sales) for the first quarter from $255.5 million (32.7% of sales) for the corresponding quarter. The company attributed most of the increase in gross profit and the higher gross profit margin to an improved product mix aided by an increase in sales volume, the positive effect of efficiency measures, and a rise in selling prices which offset rising prices for raw materials.
Operating profit rose to $125.0 million (15.1% of sales) for the first quarter from $112.1 million (14.4% of sales) for the corresponding quarter.
Net profit fell 2.7% to $89.3 million for the first quarter from $91.7 million for the corresponding quarter. The lower profit was due to a higher tax expense than in the corresponding quarter.
Asia Pacific and Africa sales had the strongest growth, up 11.4%, to $141.2 million for the first quarter from $126.7 million for the corresponding quarter. European sales rose 9% to $423.5 million from $388.9 million, and North American sales rose 4% to $131.9 million from $126.9 million. However, lower sales in Argentina, due to a drought, reduced Latin American sales 5.4% to $107.4 million for the first quarter from $113.5 million for the corresponding quarter.
Makhteshim chairman Yang Xingqiang said that Makhteshim and ChemChina were investigating business opportunities in China that would enable the companies to strengthen their presence in China and the Pacific Asian region.
China National Chemical Corporation (ChemChina) owns 60% of Makhteshim and Nochi Dankner-controlled IDB Holding Corp. Ltd. (TASE:IDBH) unit Koor Industries Ltd. (TASE:KOR) owns 40%.
Published by Globes [online], Israel business news - www.globes-online.com - on May 13, 2012
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