Thorleif Enger: Major ambitions for Agri
Hydro Agri will continue to expand its activities in growth markets and improve plant productivity even further. Executive vice president Thorleif Enger also intends to play an active role in the consolidation taking place in the fertilizer industry. It cannot be claimed that the business lacks the financial muscle, or the ambition, to do so.
Thorleif Enger painted an optimistic picture for financial analysts at Hydro's Capital Market Day in Oslo on Monday. Market prospects are good, Hydro's position as a fertilizer producer is unique and the company's brands strong.
Hydro Agri's third quarter results were so good that Enger has to look far to find a better competitor with which to compare Agri, and give his 8,000 employees a goal to strive for.
In a competitiveness ranking for the industry, Hydro Agri has climbed from bottom to top position in just a few years. But there is room for even greater improvement.
"Historically speaking, the financial market's perception of the fertilizer industry has not been too positive. But the industry does deliver, and Hydro is a leading player in it. In the period from 1990 to 2001, three leading agri-companies reported good returns compared with other chemical industry companies. Their results were in fact considerably better than those of the really big names in the chemical industry.
Industry substantially changed
He pointed out that Western Europe's fertilizer industry has undergone substantial changes over the last four to five years. Production capacity totalling five million tonnes has been phased out.
"In Hydro we have sold or shut down 11 plants, closed 12 sales offices and divested 25 other businesses. Our entire organization has been streamlined. Fixed costs have been reduced by a further NOK 210 million during the first nine months of this year," he said.
Enger promised that the positive fixed cost trend would continue, but that it would flatten out now Hydro Agri Turnaround is definitively completed.
"Our position is unique. We are the largest player in the industry, the only true global fertilizer company, and we have a balanced product portfolio that matches market demand perfectly."
Enger stated that Hydro is the world's biggest ammonia supplier with a third of global trade. The company is also a global leader in nitrate fertilizer and has a market share of 30 percent in Europe. In the balanced fertilizer sector, the company is leading in Europe, and plays a major worldwide role through collaborations and partnerships. The company's global distribution and marketing network, with more than 60 sales offices, represents an important success factor. The company also leads in specialty fertilizers, as it does when it comes to selected industrial applications in Western Europe.