November 29 (SeeNews) - Bulgarian chemical fertiliser producer Neochim [BUL:3NB] said on Thursday that it turned to a consolidated net loss of 21.6 million levs ($12.5 million/11.0 million euro) in the first nine months of the year from a net profit of 8.0 million levs in the same period of 2017.
Neochim's operating revenue dropped to 143.1 million levs in the January-September period from 158.1 million levs in the corresponding period of last year, the company said in an interim financial statement.
The company's decline in revenue can mainly be attributed to lower ammonium nitrate sales both domestically and abroad. Neochim's ammonium nitrate sales on the Bulgarian market fell to 59.1 million levs from 69.3 million levs the year before, while ammonium nitrate exports decreased to 48.9 million levs from 55.4 million levs.
However, the decline in Neochim's revenue abroad was partially offset by ammonia sales, which increased to 24.7 million levs in the review period from 20.9 million levs the year before.
The company's operating expenses rose to 164.6 million levs in the review period from 150.1 million levs in the comparable period of 2017.
The rise in expenses can, to a large extent, be explained by the growing greenhouse gas emission allowance costs, which rose to 10.9 million levs in the nine months through September compared to 2.3 million levs in the same period of 2017.
The greenhouse gas emission allowances are part of the EU Emissions Trading System, which works on the “cap and trade” principle. Within the cap, companies receive or buy emission allowances which they can trade among themselves as needed. Each year companies must surrender enough allowances to cover all their emissions, otherwise fines are imposed.
(1 euro = 1.95583 levs)