Yara has established ten long-term goals for value creation, underlining its growth ambitions, while creating value for stakeholders. By pursuing its strategy throughout 2009 consistently, Yara has delivered on its goals according to the summary under.
Our strategic goals - performance 2009
Yara’s goal is to deliver a Cash Return On Gross Investment (CROGI ) of more than ten percent as an average over the business cycle.
Performance 2009: Yara delivered a CROGI of 8.5 percent, down from 22.9 percent in 2008.
2 Relative competitiveness
Yara’s goal is to deliver a Gross Return (EBITDA/Total Assets) in the top quartile of a peer group of leading chemical companies.
Performance 2009: Yara’s return on assets (9 percent) was in the last quartile in 2009, reflecting un-precedented drops in fertilizer prices and deliveries.
Yara’s goal is to retain a mid-investment grade credit rating, i.e. minimum BBB, according to Standard & Poor’s methodology.
Performance 2009: Yara maintained a Standard & Poor’s rating of BBB with stable outlook, and a similar rating from Moody’s, through 2009.
4 Cash returns
Yara’s goal is that cash return to shareholders should average 40–45 percent of net income, with dividends at a minimum 30 percent over the business cycle. Share buybacks will constitute the rest.
Performance 2009: Total cash returns to shareholders was NOK 1,544 million, or approximately 19 percent of 2009 net income.
5 Growth in low-cost gas supply
Yara’s goal is to increase its proportion of production in low cost gas regions in order to reduce the average production cost of its fertilizer products.
Performance 2009: Yara’s share of low cost gas increased from 29 percent in 2008 to 37 percent in 2009, due to Lifeco and increased production in Burrup.
6 Overall growth
Yara’s goal within a business cycle is to achieve a ten percent market share in the global fertilizer market, and an average annual growth in the industrial segment of 10–15 percent.
Performance 2009: The establishment of a Libyan JV added 0.9 million tons urea to Yara’s marketing. The decision to build Qafco 6 will add 1.3 million tons of urea in 2012, of which Yara normally markets at least 50 percent.
Yara’s goal is to positively address major global challenges, and to pursue industry-leading standards in all our operations and activities.
Performance 2009: Yara pursued its engagement in climate change and food security issues, saw further development in its support for an African green revolution, reinforced its commitment to the UN Global Compact, and developed the Yara Ethics Program.
Yara’s goal is to be among the most energy efficient companies in the industry, and to reduce greenhouse gas emissions by 45 percent from 2004 to 2013.
Performance 2009: Yara’s target was to reduce GHG emissions by 25 percent from 2004 to 2009. Yara obtained a 37 percent reduction when adjusting for new plants and for market-related capacity reductions in 2009. This has been achieved by the installation of Yara’s technology for reducing nitrous oxide N2O emissions from nitric acid plants.
Yara’s goal is to be a leading performer in the area of worker safety, with a targeted accident rate as close to zero as possible.
Performance 2009: Yara achieved an LTI rate of 1.5 for employees and contractors combined. The average LTI rate for other fertilizer producers in Europe was three times higher. However, Yara experienced two major accidents; a fatal one when a contractor fell down from a roof and an explosion at the ammonia plant in Belgium.
10 Human Resource Management
Yara’s goal is to optimize the management of its people, to ensure that it continues to have the skilled and engaged workforce it will need to meet future business challenges.
Performance 2009: An HR strategy through 2012 was approved by the Executive Management Team, which also launched a restructuring of the global HR delivery model to improve the efficiency and effectiveness of HR operations.