Adama Posts Higher Profit for Year, Weighs IPO Options

Adama posted a 19.1% increase in profit for 2014 buoyed by more product sales in Latin America, Europe and North America.

Before one-time costs related to preparation for an initial public offering and provision for early retirement of employees, net income for the year rose nearly 15% to $146 million, Adama said.

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The company, which is majority-owned by CNAC, the agrochemical arm of ChemChina, posted a wider net loss of $32.6 million in the fourth quarter, compared with a loss of $29.1 million in the year-ago period. Revenue rose 2.8% to $674.2 million in the period.

For the full year, adjusted net income climbed 19.1% to $151.3 million, from $127.1 million in 2013. Full-year revenue increased 4.7% to $3.22 billion.

Adama Chairman Yang Xingqiang said, “The past year was an exceptional period for Adama as we took a number of steps to position our organization for long-term growth. Most importantly, we laid the groundwork for our expansion into China, a vital and fast-growing market with significant untapped potential.”

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Xingqiang said that with investments underway in a global formulation center and R&D hub in China, as well as combining with the China business, “Adama is building the foundation of a leading platform, which will allow the company to fully capitalize on this major growth opportunity.”

Chen Lichtenstein, Adama president and chief executive officer, commented on the company’s new organizational structure unveiled in 2014. “We divided our global commercial operations into seven regional clusters, to enable better support and tighter delivery across our geographies. We also set up a designated division for Innovation, Development, Research and Registration (IDR), which, by managing and coordinating all these activities, will drive and focus our efforts to further increase the differentiation and innovation in our product offering.”

IPO Update

Citing adverse market conditions, Adama postponed its planned IPO on the New York Stock Exchange in late 2014. “Various possibilities” are being examined regarding executing the business combination between the company and the China business, “whether by consummating the acquisition as originally agreed, or in a different manner.”

The company said it is also considering its options regarding a future flotation, including both the listing venue and its timing, “all in accordance with the advantages of the different markets and the developments in market conditions.”

 

 

 

 

 

 

 

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