Investor Relations

Financial prospects 2014

Yara aims to maintain a long-term mid-investment grade rating level, i.e. BBB according to Standard & Poor’s methodology and Baa2 according to Moody’s methodology. This implies that the company should normally operate with a net debt below two times EBITDA, and that larger acquisitions would normally be accompanied by new equity issuance.
Financial prospects 2014

Capital management

Yara aims to maintain a long-term mid-investment grade rating level, i.e. BBB according to Standard & Poor’s methodology and Baa2 according to Moody’s methodology. This implies that the company should normally operate with a net debt below two times EBITDA, and that larger acquisitions would normally be accompanied by new equity issuance.


Investment intentions


Yara’s growth ambitions imply significant investments, through expansion of existing operations, new builds and acquisitions. The Board of Directors underlines that the focus on growth opportunities is combined with strict valuation and capital discipline, seeking opportunities where Yara has the best relative synergies, at the right time of the cycle.

Yara expects to invest a total of approximately NOK 11.6 billion during 2015 based on announced growth investments and planned maintenance. The investment level required to maintain current Yara production capacity and productivity is estimated to be approximately NOK 5 billion per year.

Most of the remaining NOK 7 billion is linked to volume and/or margin growth:


  • NOK 1.3 billion is planned to be invested in brownfield expansions in NPK plants in Norway and Finland and Yara’s TAN plant in Köping, Sweden.
  • The Yara Pilbara technical ammo¬nium nitrate plant is scheduled for completion in 2015 with a total investment of USD 800 million, of which Yara’s 45% share in 2015 is approximately NOK 600 million. 
  • The construction of a world scale ammonia plant in Freeport, Texas together with BASF will start in 2015. Yara’s share of 2015 invest¬ments amount to NOK 1.2 billion.
  • A frame of NOK 1.7 billion is set aside for productivity and efficiency improvement projects in Yara’s production plants in addition to smaller Downstream and Industrial acquisitions, ammonia ship investments and Downstream terminals and blending units.
  • An additional NOK 1.5 billion of maintenance investments are required in 2015 to further improve reliability and accom¬modate a higher than normal number of plant turnarounds.

Dividends and buy-backs

Yara’s objective is to pay out an average 40-45% of net income in the form of dividends and share buy-backs. Within this objective, a minimum 30% of net income shall be paid in the form of dividends, while share buy-backs make up the balance and are deployed with greater flexibility.

Dividends

Dividends 2014 View graph

Yara’s Board will propose to the Annual General Meeting a dividend payment of NOK 13 per share for 2014, which represents 47% of net income after non-controlling interests, totaling a payment of NOK 3,581 million based on outstanding shares at the date this financial statement was authorized for issue. The above-target dividend is proposed to improve Yara’s capital efficiency. Combined with the 2014 result for Yara International ASA and other effects, the proposed dividend results in a net increase in equity of NOK 1,836 million.

In 2014 Yara paid out NOK 3,212 million in dividends and share buy-backs, representing approximately 56% of net income in 2013.

Yara executes share buy-back programs as an integral prt of its shareholder policy. In 2014 Yara bought back and redeemed shares for a total of NOK 441 million. The Board intends to propose to the Annual General Meeting a new buy-back program along the lines of the existing one.

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