Sinofert Holdings, a listed fertiliser unit of mainland oil firm Sinochem Corp, posted a 14.9 per cent increase in net profit for last year, shrugging off a 24.5 per cent decline in sales of potassium fertiliser stemming from protracted procurement talks with foreign suppliers.
Sinofert, the mainland's largest fertiliser distributor, reported a net profit of HK$896.24 million, a rise from HK$779.42 million in 2005 but 4 per cent short of the HK$933.61 million mean estimate of eight analysts polled by Thomson First Call.
Turnover grew 9.7 per cent to HK$21.12 billion, due to a 12.5 per cent increase in sales volume to 12.57 million tonnes.
However, this was partly offset by lower average price per tonne of sales as it sold more domestic products which are cheaper than imports.
Gross profit margin edged up to 8.08 per cent from 8.02 per cent in 2005, thanks largely to the margin improvement in potassium fertiliser sales to 12.6 per cent from 10.7 per cent, as the company used more low-cost inventory and cut imports.
Potassium fertiliser accounted for 42 per cent of the company's overall sales volume, compared with 25 per cent for nitrogen fertilisers, 14 per cent for phosphate fertilisers and 19 per cent for compound fertilisers.
