Moroccan phosphate giant OCP publishes solid 2019 results

Despite « less favourable market conditions », the Moroccan phosphate giant OCP confirms more than ever its status as the cash-machine of the Cherifian kingdom. With an annual turnover of 54.09 billion dirhams (5.3 billion dollars) and a net margin close to 30%, the world leader in phosphate ore has – once again – published excellent results.

Published on Tuesday, March 31, these figures conceal, however, an overall deterioration in the business climate: a drop in raw material prices, a fall in fertilizer prices… So many unfavorable elements that resulted in a slight inflection of the turnover of the Cherifian Phosphate Office, down 3.2% compared to 2018. The same applies to EBITDA1 , which reached MAD 15.33 billion ($1.5 billion) in 2019, compared to MAD 17.079 billion ($1.7 billion) in 2018, i.e. a net margin of 28% compared to 31% one year earlier. However, lower fertilizer prices were partially offset by higher export volumes, particularly to Latin America and Africa, where fertilizer sales grew by 11% in 2019.

1English acronym meaning « Earnings before interest, taxes, depreciation and amortization ». It is an Anglo-Saxon financial indicator that corresponds more or less to « gross operating surplus », the French cousin of EBITDA.

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As for the outlook for the current year, the charismatic CEO of the group, Mostafa Terrab, was optimistic, expecting a growth in demand « expected in all regions with relatively stable prices in 2020, also accompanied by the rise in prices of agricultural raw materials and an index of accessibility favorable to the farmer ». Many analysts are nevertheless taking a cautious view of these forecasts, as the current context of the Covid-19 pandemic can only make activity projections for 2020 uncertain.