14 February 2024

OCI Global Reports Q4 2023 Results

Download PDF
OCI Global Reports Q4 2023 Results

Financial Highlights

  • OCI Global (Euronext: OCI) reported total FY 2023 revenues of $5,022 million, a decrease of 48% YoY, and total FY 2023 adjusted EBITDA of $1,214 million, a decrease of 69% YoY. Q4 2023 revenues of $1,209 million and Q4 2023 adjusted EBITDA of $310 million represented a 45% and a 54% decline YoY respectively. The YoY declines were driven primarily by materially lower nitrogen pricing globally, partially offset by a reduction in natural gas prices in Europe and the US. Quarter-on-quarter, adjusted EBITDA increased 28% as a result of a recovery in global ammonia prices.
  • Adjusted net loss from total operations in Q4 2023 was $46 million, versus adjusted net profit of $205 million in Q4 2022.
  • Total operating free cash flow was $16 million in Q4 2023.
  • Net debt from total operations was $3,740 million at 31 December 2023, with total net leverage of 3.1x on a consolidated basis.
  • In December 2023, OCI entered into a binding equity purchase agreement for the sale of 100% of its equity interests in Iowa Fertilizer Company LLC (“IFCo”) to Koch Ag & Energy Solutions (“KAES”) for a purchase price consideration of $3.60 billion on a cash free debt free basis, following a competitive process. OCI also announced the sale of its 50% stake in Fertiglobe (ADX: FERTIGLB) to Abu Dhabi National Oil Company P.J.S.C. (“ADNOC”) in December for a total consideration of $3.62 billion, fully exiting and monetizing its entire equity stake. OCI and ADNOC have further entered into an agreement to explore global strategic collaboration on future joint investments in decarbonization and product distribution across North America and Europe.
  • Proceeds from these two transactions will be used to significantly reduce holding company debt to a net cash position by year-end 2024, alongside a substantial distribution of capital to shareholders of at least $3 billion, whilst continuing to execute announced growth initiatives.
  • OCI has suspended its semi-annual cash distribution in light of recent strategic activity during the period and given extraordinary distributions of capital to shareholders expected to be made in FY 2024 from transaction proceeds
  • Pursuant to the recently announced divestments, and as a result of inbound interest in the continuing business, OCI is currently exploring further value creative strategic actions.
  • Discontinued Operations in the Segment Analysis include Fertiglobe, IFCo and a portion of N-7 operations.

Ahmed El-Hoshy, CEO of OCI Global commented:

“We are proud of OCI’s achievements in 2023, a challenging yet transformational year for the company. Encouragingly, OCI benefited in the fourth quarter from positive momentum in nitrogen prices globally, which helped offset lower volumes at IFCo, attributable to the extended turnaround. In contrast, methanol has seen a more challenging year, with down-cycle pricing and uncertainty around key macroeconomic drivers.

The successive announcements of the sale of our equity holding in Fertiglobe to ADNOC, and our industry leading Iowa fertilizer asset to KAES in December 2023 marked a pivotal juncture in OCI’s history. The transactions are expected to deliver $7.2 billion of gross cash proceeds subject to customary closing conditions and receipt of relevant antitrust approvals, and both are expected to close this year. This significant value unlock has helped narrow the discount to OCI’s intrinsic value and further reinforces OCI’s extended track record of value creation.

Looking ahead, we remain focused on running our operations effectively whilst working towards the successful closing of both transactions. On a continuing basis, our strategically differentiated and well capitalized platform is optimally positioned to accelerate efforts in the energy transition space, consolidating early mover advantages and leveraging superior execution capabilities in lower carbon products. We are targeting to materially increase our earnings from our low carbon ammonia and methanol portfolio in the coming years. This portfolio includes OCI’s low carbon ammonia and methanol complex in Texas, our uniquely positioned European fertilizer and integrated nitrates business in the centre of Europe’s agricultural heartland, our growing AdBlue/DEF capacity in Europe, and our unique import and distribution capacity at the Port of Rotterdam. We remain the leading green methanol producer globally and our low carbon initiatives cumulatively place us well ahead of our peers, enabling us to capitalize upon the increasing demand for ammonia and methanol from emerging applications such as shipping fuel and power generation, as well as further decarbonizing existing agricultural and industrial end markets.

In closing, we look forward to an exciting year ahead and I wish to personally thank the entire OCI team for their tireless focus on operational and process safety, which remains our top priority, and my colleagues’ ongoing commitment to manufacturing excellence.”

Strategic Review

In December 2023, OCI announced the successive sales of its 50% equity holding in Fertiglobe to ADNOC, and 100% of Iowa Fertilizer Company LLC to KAES, following the launch of a multi-faceted global strategic review in March 2023. The strategic review was initiated to bridge the gap between the combined value of the individual assets in the Company’s portfolio and the holding company discount.  Both transactions are expected to close during the course of 2024, subject to legal and regulatory conditions and relevant anti-trust approvals.

The transactions mark an important step in OCI’s transformation journey with the expected crystallization of $7.2 billion of gross cash proceeds, or $6.2 billion of cash proceeds on a net basis (EUR 27 per share) subject to closing adjustments. These strategic actions re-emphasize the company’s heritage and its relentless focus on value creation.

OCI intends to use the proceeds of the transactions to deleverage the company to a net cash position by year-end 2024, and to fully fund the remaining capital expenditure required to complete Texas Blue Clean Ammonia. A substantial return of capital to shareholders of at least $3 billion is also planned during 2024.

As a result of these strategic events and the upcoming extraordinary distribution of cash to shareholders, OCI will suspend its regular dividends through the transition period. For reference, OCI has distributed over $2 billion in cash since commencing its dividend distributions in FY 2021.

Given the changes in business perimeter, OCI expects to execute reductions in its holding company (“HoldCo”) costs. OCI anticipates a $30-$40 million forward run-rate in HoldCo costs by 2025 as a result of these restructuring plans.

Pursuant to the recently announced divestments, and as a result of inbound interest in the continuing business, OCI is currently exploring further value creative strategic actions.

Continuing Operations Financial, Operational and Strategic Highlights

Following the announcement of the expected sale of our stake in Fertiglobe, IFCo and a portion of N-7, these segments have been classified as discontinued operations. The FY 2023 and comparative FY 2022 financial results in this press release reflects the performance of continuing businesses and discontinued businesses separately. The continuing operations include the group’s holding costs, net finance costs and other costs on an unadjusted basis.


  • For the fourth quarter, total own production volumes from OCI’s methanol assets increased 7% YoY to 305 thousand tonnes and generated an adjusted EBITDA of $28 million, compared to $63 million last year and $11 million in Q3 2023. The declines year-on-year reflected down-cycle pricing and subdued demand. Q4 2023 volumes were additionally impacted by outages at OCI Beaumont and Natgasoline. The Methanol business includes the production and sale of conventional methanol, biomethanol, ammonia (produced at OCI Beaumont) as well as results from trading activities.

European Nitrogen

  • European Nitrogen reported a Q4 2023 adjusted EBITDA of $4 million compared to a loss of $90 million in Q4 2022 and a gain of $16 million in Q3 2023. Although Nitrogen prices reduced materially year-on-year, this impact was more than offset by lower costs and a reduced impact from gas hedging. The decline versus Q3 2023 was driven by higher gas prices and reduced sales volumes as customers delayed purchases for the spring application season; we expect this demand to catch-up and materialize through the course of H1 2024.
  • In the Netherlands, OCI’s nitrogen complex and its 400kt throughput capacity in Rotterdam continues to afford significant benefits for upstream ammonia distribution into the Dutch and Western European markets as feedstock for fertilizer, as well as downstream distribution into the chemicals and the fuels value chain as a hydrogen carrier. The Rotterdam asset continues to offer considerable strategic optionality, with further capacity increases being explored.
  • In Q4 2023, OCI made two announcements demonstrating the demand potential for renewable and low carbon ammonia for industrial use:
  • OCI supplied Röhm a leading manufacturer of methacrylates, with bio-ammonia for the production of methyl methacrylate (MMA), an important precursor for PLEXIGLAS® – the world’s most popular brand of acrylic glass. The partnership demonstrates the viability of lower carbon ammonia in industrial processes, supporting downstream decarbonization to other industries and ultimately end consumers.
    • In November, OCI launched OCI Dynamon, an integrated nitrogen-sulphur fertilizer (CAN + sulphur), which combines the benefits of both nutrients to increase yield and supply and is higher margin. Q2 2024 will see the addition of 300kt of higher margin AdBlue volumes in Europe coming on stream.
  • In January 2024, OCI announced it is supplying Foresa with BIO MelaminebyOCI™ to be used in the production of essential and everyday products including components for furniture and laminate flooring. OCI Global is the only producer of ISCC PLUS certified bio-melamine in Europe today. OCI’s bio-melamine is produced using biomethane from waste and residues of biological origin, via the mass balance process, resulting in  a GHG reduction of  up to >40% compared to conventional melamine production.

Texas Blue Clean Ammonia

  • OCI believes that greenfield blue ammonia remains the most efficient decarbonization pathway and the most cost-competitive product for low carbon ammonia today. OCI’s 1.1 million tonne Texas Blue Clean Ammonia project, the world’s first large-scale greenfield blue ammonia plant remains on track for commissioning H1 2025. Construction is well underway with c.$500 million spent to date, the plant more than 90% engineered, piling complete, and the first steel structures erected.
  • Commercial discussions for long-term product offtakes and equity investments in the project are at advanced stages with multiple parties.
  • OCI’s clean ammonia design philosophy offers highly synergistic future expansion and growth optionality. Space for a second identical line expansion has been ring-fenced, with utilities and supporting infrastructure oversized to facilitate potential future expansion. A second line would be a simpler and smaller project than the first, with cost benefits deriving from early-mover advantage, requiring less capex, and critically providing the opportunity to capitalize on additional clean ammonia demand at low development cost.

Market Outlook


  • 2023 was a challenging year for global methanol markets. The first half of the year saw exceptionally strong production in the US, with monthly operating rates consistently tracking near multi-year highs. MTO operating rates averaged just 70% through the same time period. As a result, global pricing decreased through end Q2. In early Q3, oil prices began increasing, eventually peaking above $90/bbl. Rising crude oil prices supported Chinese MTO affordability and operating rates. Chinese methanol prices rose through Q3 and maintained the heightened pricing through Q4. In the West, a few planned and unplanned outages in Q4 tightened the supply and demand balance, and prices improved.
  • Methanol fundamentals remain positive in the medium term, notwithstanding global macroeconomic uncertainties, supported by oil prices, new marine fuel demand and limited new supply additions. Demand for hydrogen fuels as a cleaner alternative for road and marine fuel applications continues to increase. Methanol end markets such as maritime and fuels continue to present significant and accelerating earnings potential opportunities for OCI. Prices have rebounded over the past few weeks, with Houston spot rates now above $350/t.
  • OCI remains the leading producer of an array of low carbon methanol products globally with 200kt capacity currently and expected to rise in the coming years, given the significant expected increase in demand. This increased capacity will come from a mix of renewable feedstocks, including renewable natural gas (RNG) and other over the fence feedstock partnerships. Additionally, OCI’s first upstream RNG production facility is expected to come on stream in 2025. OCI Global remains committed to a materially greater proportion of its earnings from low carbon sources/green methanol by in the coming years.


  • OCI believes the outlook for nitrogen markets remains supportive, underpinned by healthy agricultural demand fundamentals, emerging demand for low carbon ammonia, and tightening supply dynamics in the medium term.
  • Nitrogen markets were relatively quiet during the fourth quarter of 2023, and urea prices were impacted by demand deferrals into 2024. However, urea prices have rebounded so far this year as the deferred demand ahead of the spring season application started to materialize in the Northern Hemisphere. Further support for nitrogen fertilizer prices during the coming months is expected to be driven by low inventories in key importing regions, ongoing restrictions on Chinese exports, low operating rates in Iran due to gas shortages, and supply chain disruption in the Red Sea.
  • Medium-term urea fundamentals remain positive with limited major new supply and a significantly slower pace of capacity additions over the 2024 – 2027 period compared to the previous three years.
  • Ammonia prices increased in the fourth quarter compared to the third quarter of 2023, underpinned by widespread supply disruptions. Prices have dropped from the recent highs, but remain at supportive levels and above the troughs reached last year. Industry consultants expect a recovery in global ammonia trade from trough levels of ~17 million tonnes in 2022 / 2023 towards historical levels of 19+ million tonnes per year, as demand for downstream fertilizers, driven by improved affordability, recovers and industrial demand picks up.
  • Medium term, there is potential incremental demand from new applications for ammonia such as its use as a fuel for power generation, especially in Japan and Korea. These two markets alone could generate incremental demand for ammonia of six to nine million tonnes by 2030. Interest in decarbonization of existing value chains within fertilizers and chemicals is also gaining pace. In addition, the outlook for ammonia as a marine fuel continues to strengthen with the potential of accelerated demand growth emerging from 2026 onwards.

Conference Call Details

A conference call for investors and analysts will be hosted on Wednesday, 14 February 2024 at 3:30 PM CET (2:30 PM GMT, 9:30 AM ET) by Ahmed El-Hoshy, Chief Executive Officer and Hassan Badrawi, Chief Financial Officer. 

Investors can access the call and ask live questions by dialling one of the following numbers using the code 510774

UK Toll-Free Dial-in: +44 800 358 1035

USA Toll-Free Dial-in: +1 855 979 6654

Netherlands Dial-in: +31 85 888 7233

UAE Dial-in: +971 800 035704553

All other locations: Global Dial-In Numbers

Participants may also join via the webcast. Please pre-register and join here.

Please log-in or dial-in at least 10 minutes prior to the start time to ensure a fast connection to the call.  

A replay of the webcast will be available through the OCI Global corporate website at www.oci-global.com

Subscribe to email updates

Subscribe for news and stories about our business, industries, and products.

Thank you for subscribing.

Lines Effect