EANS-News: K+S Aktiengesellschaft / Revenues and earnings increase significantly in 2010 K+S Group on a growth course

--------------------------------------------------------------------------------
Corporate news transmitted by euro adhoc. The issuer/originator is solely
responsible for the content of this announcement.
--------------------------------------------------------------------------------

Kassel (euro adhoc) - Kassel, 10 March 2011

Revenues and earnings increase significantly in 2010
K+S Group on a growth course

• Q4/2010:
- Fertilizer and salt markets in very good shape
- At EUR 1.34 billion, revenues up 26% year on year
- Adjusted earnings per share rise to EUR 0.69 (Q4/2009: EUR 0.10)

• Financial year 2010:
- Significant recovery in the demand for fertilizers and very strong
salt business; first-time inclusion of Morton Salt for whole year
- K+S Group´s revenues rise by 40% to EUR 5.0 billion
- Operating earnings (EBIT I) treble to EUR 727 million;
at EUR 2.33, adjusted earnings per share approx. quadrupled
- Dividend proposal: EUR 1.00 per share (2009: EUR 0.20)

• Outlook 2011: Tangibly higher revenues and significant rise in earnings
expected

• Acquisition of Potash One decisive strategic step for tapping into new
potash capacities

• Conversion to registered shares planned

The K+S Group is looking back to a very successful financial year 2010, in
which all its business segments attained increasing revenues and higher
earnings compared with the previous year.
"In 2010, we again managed to achieve a significant increase in revenues and
earnings. We have emerged from the 2009 crisis strengthened and are looking
confidently to the future," said Norbert Steiner, Chairman of the K+S Board of
Executive Directors, at the Company´s financial report press conference.

Significant recovery of fertilizer demand
Already at the start of the year under review the trade sector showed a high
catch-up demand in order to again build up the very low stocks of fertilizers
ahead of the spring season. Later in the year, agriculture largely returned to
a sustainable consumption pattern. The sharp increase in cereal prices that
started in the second half of the year and the resulting improved income
situation of farmers further boosted the demand for fertilizers.

Salt business fuelled by high demand for de-icing salt in Europe
The extraordinary strong winter that covered Europe caused a huge demand for de-
icing salt, especially in the first and fourth quarters of 2010. While the long-
term average and thus the sales volume budget for the European K+S salt
subsidiary esco is just under 2 million tonnes of de-icing salt, more than
twice that much was sold here alone last year. The de-icing salt business in
North America in 2010 lagged somewhat behind the long-term average.

Revenues in 2010 significantly higher year on year
K+S Group revenues for the whole of 2010 rose by about 40% to just under EUR
5
billion. The increase in revenues is particularly attributable to volume and
consolidation effects, which more than made up for the effects of prices. The
Potash and Magnesium Products business segment posted the highest revenues of
all the K+S Group´s business segments, accounting for just under 37% of the
total, and was followed by Salt (about 35%) and Nitrogen Fertilizers (just
under 26%).

In Europe, revenues were EUR 2.6 billion (+38%). Thus, this region accounted
for
approximately 53% of total revenues. Revenues generated on overseas markets
rose by 41% to EUR 2.4 billion, about 47% of total revenues. The acquisition
of
Morton Salt has contributed to the regional distribution of revenues now being
very balanced between Europe and overseas on the one hand, and the revenue
shares of the individual business segments in total revenues having become more
equal on the other hand.

Strong improvement in operating earnings
During the year under review, earnings before interest, taxes, depreciation and
amortisation (EBITDA) rose by 137% to EUR 975.2 million. As the EBITDA is
not
affected by write-downs on valuations made within the framework of purchase
price allocations and these have increased significantly after the acquisition
of Morton Salt, the EBITDA will now be more important in assessing the
operating earnings capacity.

Operating earnings (EBIT I) increased by EUR 488.9 million or 205% to EUR
726.9
million (2009: EUR 238.0 million). While the Potash and Magnesium Products
and
Nitrogen Fertilizer business segments increased their earnings as a result of
the significant increase in fertilizer demand throughout 2010, the good
earnings in the Salt business segment are attributable both to a positive
consolidation effect (EUR 68.6 million) and to an above-average business of
de-
icing salt in Europe.

Adjusted earnings multiplied year on year
In the year under review, adjusted earnings before taxes totalled EUR
603.4
million, a year-on-year increase of EUR 480.8 million. Adjusted Group
earnings
reached EUR 445.3 million from EUR 93.6 million the year before (details of
the
adjustment process can be found in the 2010 financial report, pages 109-113).
For the year under review, adjusted earnings per share amounted to EUR 2.33
and
were roughly four times higher than the figure for the previous year of EUR
0.56.

Q4/2010: Significant increases in revenues and earnings
Fertilizer and salt markets were in very good shape in the fourth quarter of
2010 as well. During this period, the K+S Group´s revenues rose by 26% to
EUR
1,340.5 million, mainly due to volume factors.
During the fourth quarter, earnings before interest, taxes, depreciation and
amortization (EBITDA) increased by EUR 156.5 million to EUR 260.8
million.
Operating earnings (EBIT I) in the fourth quarter amounted to EUR 195.2
million
and were thus greatly improved against the low level a year ago (Q4/09: EUR
36.5
million). While the Potash and Magnesium Products and Nitrogen Fertilizer
business segments increased their earnings as a result of the significant
increase in fertilizer demand since the start of the year, the good earnings in
the Salt business segment are attributable to a strong de-icing salt business.

In the fourth quarter, adjusted Group earnings before income taxes amounted to
EUR 176.1 million (Q4/2009: EUR 17.8 million) and adjusted Group earnings
after
taxes, at EUR 123.2 million, were also significantly higher than a year
ago
(Q4/2009: EUR 15.6 million).

Board of Executive Directors and Supervisory Board propose a dividend of EUR
1.00
per share
As a result of the strong increase in the adjusted earnings of the K+S Group
and in line with the long-term dividend policy, the Board of Executive
Directors and the Supervisory Board propose to the Annual General Meeting that
a dividend of EUR 1.00 per share (previous year: EUR 0.20) be paid for 2010.
This
corresponds to a payout ratio of 43%.

Positive outlook for 2011 as a whole
Norbert Steiner, Chairman of K+S´s Board of Executive Directors, on the subject
of expected business performance: "I am very confident that 2011 will also be a
good year for the K+S Group. World fertilizer demand should increase further
and, following the peak year 2010, we assume that total salt business should
stabilise at a high level."

Following the estimates in the outlook of the third quarter of 2010 and against
the background of the positive demand and price trends emerging at the end of
the year and during the course of the first quarter of 2011, revenues of the
K+S Group should rise tangibly in financial year 2011 against the previous year
(previous forecast: moderately).

For the financial year 2011, we are forecasting significantly higher operating
earnings (EBIT I) in comparison to last year´s figure. This is primarily due to
the expected significantly higher earnings in the Potash and Magnesium Products
business segment as well as a moderate (previous forecast: tangible)
improvement in operating earnings in the Nitrogen Fertilizers business segment.
On the other hand, the operating earnings of the Salt business segment will
probably fall moderately (previously: significantly).

In 2011, the adjusted Group earnings after taxes should also be significantly
higher in line with the development of operating earnings. The projection is
based not only on the effects described for revenues and operating earnings,
but also on the following circumstances and premises expected from today's
perspective:

• continued attractive agricultural prices;
• higher average proceeds and stable sales volumes in the Potash and
Magnesium Products business segment (expected sales volume in 2011: about
7 million tonnes; 2010: 6.99 million tonnes);
• 22 to 23 million tonnes of crystallised salt to be sold in 2011 (2010:
22.5 million tonnes);
• a US dollar exchange rate of 1.35 USD/EUR;
• a significantly better financial result, after this was negatively
impacted by special effects in 2010;
• significantly rising energy costs in 2011 as a result of an oil price of
around US$ 90 per barrel and the energy contractual clauses to which K+S
is bound;
• a stable adjusted Group tax ratio of 26% to 27%.

Successful takeover of Potash One in Canada
"With the acquisition of Potash One, we have successfully taken a decisive
strategic step," says Norbert Steiner, Chairman of K+S´s Board of Executive
Directors. "The new potash deposits in Canada, added to that of our domestic
potash mines, will significantly increase our international competitiveness,
thus benefiting the K+S Group as a whole," Steiner continues. As the take over
bid was accepted by more than 90% of the Potash One shareholders, the remaining
outstanding Potash One shares will be acquired by means of an exclusion
procedure within the framework of the Canada Business Corporations Act. By mid-
May 2011, the acquisition of Potash One should be completed. In order to
continue the project systematically initial investments in the infrastructure
and initial drilling will already occur in 2011.

Conversion to registered shares planned
K+S intends to convert bearer shares to registered shares. An appropriate
proposal will be put to the vote by shareholders at the K+S Annual General
Meeting on 11 May 2011.

The changeover to registered shares offers advantages to both shareholders and
the Company. Registered shares permit even better and more direct communication
with shareholders and, in the framework of an Annual General Meeting, make it
easier for them to register and vote. They also result in savings for the
Company because invitations for shareholders to the Annual General Meeting can
be sent directly to the shareholders, including by electronic mail to an
increasing extent.

Provided that the Annual General Meeting votes in favour of this motion,
conversion should take place in the late summer of 2011. In such a case, the
shareholders shall be notified in good time by their depositary banks of the
forthcoming conversion to registered shares and of the first-time registration
in the share register.

Experience growth
The K+S Group is one of the world's leading suppliers of standard and
speciality fertilizers. In the salt business, K+S is the world´s leading
producer with sites in Europe as well as North and South America. K+S offers a
comprehensive range of goods and services for agriculture, industry, and
private consumers which provides growth opportunities in virtually every sphere
of daily life. The K+S Group employs more than 15,000 people. The K+S share -
the only commodities stock on the German DAX index - is listed on all German
stock exchanges (ISIN: DE0007162000, symbol: SDF). More information about K+S
can be found at www.k-plus-s.com.

Note to editors
You can download the Financial Report 2010, the Corporate and Sustainability
Report 2010 as well as the Q4/2010 quarterly report by clicking the following
link on our website: www.k-plus-s.com/2010q4en. In addition, you will find a
video message on business developments from Norbert Steiner, Chairman of the
Board of Executive Directors, and from 10 a.m. today´s presentations of the
financial statements press conference in Frankfurt/M. of Norbert Steiner as
well as Joachim Felker and Jan Peter Nonnenkamp, both members of the Board of
Executive Directors.

An analysts´s conference in English will take place in Frankfurt/M. at 1 p.m.
today as well. Norbert Steiner, chairman of the Board of Executive Directors,
as well as Joachim Felker and Jan Peter Nonnenkamp, both members of the Board
of Executive Directors, will attend. Shareholders, investors, representatives
of the press and all other interested parties are invited to follow the
conference via a live webcast at (www.k-plus-s.com/en/audio-und-video/cc.html
or via telephone (+49-69-6677-75757; PIN 3564773#). The conference is being
recorded and will also be available as a podcast.

Your contact persons:

Press:
Michael Wudonig, CFA
Tel: +49 561 9301-1262
Fax: +49 561 9301-1666
michael.wudonig@k-plus-s.com

Investor Relations:
Christian Herrmann, CFA
Tel: +49 561 9301-1460
Fax: +49 561 9301-2425
christian.herrmann@k-plus-s.com

Forward-looking statements

This press release contains facts and forecasts that relate to the future
development of the K+S Group and its companies. The forecasts are estimates
that we have made on the basis of all the information available to us at this
moment in time. Should the assumptions underlying these forecasts prove not to
be correct or risks arise - examples of which are mentioned in the risk report
- actual developments and events may deviate from current expectations. Outside
statutory disclosure provisions, the Company does not take any obligations to
update the statements contained in this press release.

Further inquiry note:
Press:
Michael Wudonig, CFA
Tel: +49 561 9301-1262
Fax: +49 561 9301-1666
michael.wudonig@k-plus-s.com

Investor Relations:
Christian Herrmann, CFA
Tel: +49 561 9301-1460
Fax: +49 561 9301-2425
christian.herrmann@k-plus-s.com
end of announcement euro adhoc
--------------------------------------------------------------------------------

company: K+S Aktiengesellschaft
Bertha-von-Suttner-Straße 7
D-34131 Kassel
phone: +49 (0)561 9301-1460
FAX: +49 (0)561 9301-2425
mail: christian.herrmann@k-plus-s.com
WWW: http://www.k-plus-s.com
sector: Chemicals
ISIN: DE0007162000
indexes: DAX, Midcap Market Index, CDAX, Classic All Share, HDAX, Prime All
Share
stockmarkets: regulated dealing/prime standard: Frankfurt, regulated dealing:
Berlin, Hamburg, Stuttgart, Düsseldorf, Hannover, München
language: English

OTS-ORIGINALTEXT PRESSEAUSSENDUNG UNTER AUSSCHLIESSLICHER INHALTLICHER VERANTWORTUNG DES AUSSENDERS - WWW.OTS.AT | CNE

print