Investor Relations

Industrial 2008

Adjusting for special items and portfolio effects, Industrial’s 2008 EBITDA result was 23 percent lower than in 2007. The result mainly reflects lower margins.
Financial highlights 1) 2008 2007
Revenue and other income 10,995 8,563
Operating income 401 1,441
EBITDA 629 1,645
EBITDA excl. special items 534 860
CROGI (12-month rolling average) 10.4 % 25.9 %
Sales by product group (excl. industrial gases) 1)
Environmental products 1,107 893
Industrial N-chemicals (incl. TAN) 2,882 2,396
Total 3,898 3,289
1) 4Q 2007 Kemira GrowHow figures included

Industrial EBITDA

Industrial EBITDA View graph

Industrial CROGI

Industrial CROGI View graph

The sharp increase in ammonia and urea prices in the first three quarters of the year had a negative effect on the margins of the chemical related business due to different time lags in purchase and sales contracts. This affected in particular the environmental and TAN businesses. The industrial gas business was impacted negatively and by higher energy and electricity prices.

Temporary plant closures and external outages during the second half of the year led to a difficult sourcing situation with adverse margin effects for both the chemical and the gas businesses.


Total volumes ended 19 percent higher than in 2007. Adjusting for portfolio effects, volume growth was ten percent, mainly driven by increased sales of environmental applications and TAN, where growth was positive throughout the year. Sales of chemicals to the European process chemical industry ended in line with the previous year despite a significant drop in sales of technical urea in the fourth quarter. Liquid CO2 sold to European end-users ended the year in line with 2007.


Yara sold part of its chemical activity to Brenntag during the year, resulting in a gain of NOK 90 million. The divestment will lead to a reduction in annual Industrial EBITDA of approximately NOK 80 million. The gain is reflected in special items, together with the gain in 2007 of NOK 795 million from establishing the Yara Praxair joint venture.

Variance analysis  NOK
million
USD 1)
million
EBITDA 2008 629 118
EBITDA 2007 1 645  290
Variance EBITDA in NOK (1,016)
Conversion (NOK vs. USD) (144)
Variance EBITDA (1,161) (173)
Kemira GrowHow 2007a (pro forma) 2) 50 9
Volume & mix 191 38
Margin (155) (27)
Special items (875) (127)
Yara Praxair joint venture (196) (35)
Other (176) (30)
Total variance explained (1,161) (173)
1) Based on quarterly average NOK/USD rates as detailed in Yara 2008 reports. 
2) Pro forma Kemira GrowHow 1-3Q 2007 EBITDA, restated to Yara segment structure and accounting policies.

Industrial sales volume

Industrial sales volume View graph

Enviromental applications sales volume

Enviromental applications sales volume View graph

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