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Highlights

  • Incitec Pivot is a manufacturer and distributor of industrial explosives, industrial fertilizers and chemicals and associated services
  • In FY23, group revenue of IPL fell by 4.86% YoY to AUD 6,008.10 million
  • Janchor Partners has the highest stake in the firm with a shareholding of around 8.91%

Incitec Pivot Limited (ASX: IPL) is an Australia-based manufacturer and distributor of industrial explosives, industrial fertilizers and chemicals and related services. The company mainly caters to the agricultural and resources sectors. Two customer facing business of IPL are Incitec Pivot Fertilisers and Dyno Nobel.

In the financial year 2023, the company witnessed 4.86% YoY fall in its group revenue to AUD 6,008.10 million, 40.76% YoY drop in EBIT to AUD 879.80 million and 44.76% YoY decrease in NPAT to AUD 560 million.

Revenue during the reported period was impacted by commodity prices as they fell from  historic highs in FY22.

Dyno Nobel business of Incitec exceeded expectations as it delivered EBIT of AUD 188 million, backed by improvement in demand for Dyno’s premium technology and record production at the Moranbah ammonium nitrate plant.

Top 10 shareholders of DEG

The top 10 shareholders of DEG hold around 37.60% shareholding in the company. Janchor Partners Limited has the highest stake in the firm with a shareholding of around 8.91%, followed by Allan Gray Australia Pty Ltd which has 6.11% interest.

Recent business update

On 5 April 2024, IPL notified that State Street Corporation, and its subsidiary companies have ceased to be substantial shareholder in the firm on 3 April 2024.

Outlook

The company said that market conditions are expected to remain positive in Australia for its Dyno Nobel business. Additionally, for Dyno Nobel business, positive impacts of recontacting and repricing are expected to emerge through 2024 and 2025.

In the first half FY24, the company expects production at Phosphate Hill to be lower due to the Cyclone Kirrily.

Forecasted production level in FY24 have been reduced to 730kt – 770kt, from earlier estimate of 780kt – 820kt. The company highlighted that financial impact of lower production on FY24 EBIT for fertilisers business. The expected impact is likely to be around AUD 8.5 million for every 10kt of lost production, including related costs incurred.  

Share performance of IPL

IPL shares closed 1.071% down at AUD 2.770 apiece on 9 April 2024 with a market capitalization of AUD 5.43 billion. In the last 12 months, IPL’s share price has increased by 2.52%, while in the last three months, it has jumped over 12.60%.

The 52-week high of IPL is AUD 2.92, recorded on 26 March 2024, and the 52-week low is AUD 2.227, recorded on 15 June 2023.

IPL Daily Technical Chart, Source: EODHD/Others

Note 1: Past performance is neither an Indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, and currency, is 09 April 2024. The reference data in this report has been partly sourced from EODHD/Others.