• Friday, March 29, 2024
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Notore targets 500,000 metric tonnes output following Turn Around Maintenance

Notore records N7.2bn gross profit for Q4″22

Nigeria’s leading agro-allied company, Notore Chemical Industries Plc, has said that it has a target to produce 500,000 tonnes of fertilizer output after the company completed its Turn Around Maintenance (TAM) programme.

In its unaudited second quarter report ended March 31, 2021 signed by the Group Managing Director of Notore Chemical Industries Plc, Ohis Ohiwerei, the company said despite suffering several setbacks occasioned by the coronavirus (COVID-19) pandemic, it remained resilient to deliver on its programme.

According to him, “We are pleased to announce the successful completion of the TAM programme. This was a massive undertaking that involved vendors, parts suppliers, VSMs, OEMs from across the globe, and best-in-class engineering companies. Despite experiencing further interruptions to our supply chain and logistics occasioned by the global COVID-19 pandemic emergency, which directly impacted the original anticipated completion date for the TAM, the Company remained resilient and overcame the challenges to deliver a successful TAM. This signifies a key milestone to repositioning the Company and turning around its fortunes.”

He added: “The completion of the TAM ushers in a new phase in the Company’s growth with a focus on optimization and profitability. Notore is committed to continuous improvement. We expect a major upturn in the Plant’s reliability and production output to meet and sustain its 500,000MT per annum nameplate design capacity. Achieving this level of production output will not only lead to significant increases in the Company’s cash flows from operations, but also substantial increases in revenues annually. It is worth noting that a sizeable portion of the additional post-TAM revenue will contribute straight to the Company’s bottom line, a major key to returning the Company to profitability.”

He said the production and sale of Notore NPK fertilizer into the domestic market also contributed to the revenue, adding that with the ramp up of NPK production, Notore expects substantial NPK production and sales during the 2021 financial year.

“Sale of Notore seeds to Nigerian farmers has also continued in furtherance of our corporate vision to be a major contributor to the development of Africa. Additionally, while leveraging the Company’s seeds business, robust supply chain and distribution network, Notore intends to expand further into other products such as rice production. During the period under review, we successfully completed phase one of the Notore rice pilot program, which resulted in the production of 5,000 50kg bags of high-quality Notore rice. We have commenced the second phase of the Notore rice pilot program, which is expected to result in the production of 715MT of rice paddy. These additional initiatives will further diversify the Company’s revenue stream, boost profitability, and consolidate customers’ loyalty,” he said.

He said the company believes that the domestic fertilizer market is yet to reach its full potential, as the consumption of fertilizer per hectare of arable land in Nigeria is still far below the 200kg per hectare recommended by Food and Agriculture Organization, noting, “Furthermore, the demand for Urea and compound fertilizers, such as NPK, from the West African markets and neighbouring countries bordering the northern part of the Country is also substantial.

“The Company will continue to aggressively explore and work on various financial initiatives to further reduce finance cost, such as the restructuring of its capital structure to achieve an optimal mix of debt and equity. The projected cost savings from the restructuring is expected to boost the Company’s profitability.”

Ohiwerei noted that Notore expects to greatly exceed its 2020 FY production volumes, revenue, and operating cash flows.

“With respect to the fertilizer market dynamics, the Nigerian fertilizer demand remains robust and is expected to continue to grow, considering the Federal Government’s strong and decisive policy focus on agriculture as one of the keys to unlock the diversification of the Nigerian economy,” he added.

According to him, “Our business has been faced with many challenges over the past years. However, Notore is now re-positioned for a great future with the completion of TAM. As we look to the future post-TAM, the next phase of Notore’s growth will be focused on diversification, optimization, and profitability.”