ADAMA Provides Net Income Estimate for Q2 and First Half of 2022
TEL AVIV, ISRAEL and BEIJING, CHINA, July 14, 2022 – ADAMA Ltd. (the “Company”) (SZSE 000553),
today provided an estimate regarding its financial performance for the second quarter and firsthalf of 2022.
Sales
ADAMA is expecting to report sales growth of approximately 22% in USD terms (24% in RMB terms) in the
second quarter of 2022 compared to the same quarter last year.
Sales in the first half of 2022 are expected to grow approximately 25% in USD terms (25% in RMB terms),
compared to the same period last year.
The expected strong growth over the quarter and firsthalf period was primarily driven by a significant, double-
digit increase in prices,a trend which started in the third quarter of 2021, complemented by volume growth and
despite the negative impact of exchange rates and supply challenges. This growth is a reflection of the robust
demand inthe market resulting fromthe elevated global croppricesduring the firsthalf of 2022. The Company's
performance was particularly strong in Brazil, where the Company continues to work to strengthen its position
within this growing market, while the Company's sales of raw material and intermediates in China continued to
grow strongly.
Adjusted EBITDA
In the second quarter and firsthalf period, the Company is expecting to report an increase in adjusted EBITDA
and its margin, in comparison to the corresponding periods in 2021. The strong top-line growth more than
compensated for the impacts of higher procurement, production and logistics costs, exchange rate impacts as
well as higher operating costs, which were impacted amongst other factors by higher inflation.
It should be noted that certain relocation and upgrade charges have significantly declined since Q1 2022, as
the relocation and upgrade of the manufacturing Jingzhou site in China has been completed and is now at a
high level of operation.
Net Income
The Company is expecting to report an increase in Adjusted & Reported Net Income in the second quarter
and first half period, compared to the same periods last year following achieving higher Operating Profit and
despite a significantincreasein financialexpenses due to the high Israeli CPI,elevated securitization expenses
attributed to increased exposure to Brazil and higher hedging costs on exchange rate.
Adjusted Net Income Estimated H1 2021 Estimated Q2 Q2 2021
H1 2022 2022
Net income attributable to 135-165 115 60-90 64
shareholders (USD millions)
Earnings per share (USD) 0.0581-0.071 0.0496 0.0259-0.0388 0.0272
Net income attributable to 875-1,073 747 399-597 410
shareholders (RMB millions)
Earnings per share (RMB) 0.3756-0.4607 0.3207 0.1711-0.2562 0.1759
Adjusted Net Income excludes the impact of transitory or non-operational and non-cash items, mainly including:
i. Non-cash amortization charges in respect of Transfer assets received from Syngenta related to the
2017 ChemChina-Syngenta acquisition;
ii. Non-cash amortization net charges related to intangible assets created as part of the Purchase Price
Allocation (PPA) on acquisitions, with no impact on the ongoing performance of the companies
acquired;
iii. Incentive plans: ADAMA granted certain of its employees, a long-term incentive (LTI) in the form of
'phantom' awards linked to the Company’s share price. As such, the Company records an expense, or
recognizes income, depending on the fluctuation in the Company’s share price, regardless of award
exercises. To neutralize the impact of such share price movements on the measurement of the
Company’s performance and expected employee compensation and to reflect the existing phantom
awards, in the Company’s adjusted financial performance, the LTI is presented on an equity-settled
basis in accordance with the value of the existing plan at the grant date. During Q2 2022 the Company
recorded expenses due to an increase in the Company's share price;
iv. Manufacturing facilities relocation & upgrade-related costs: certain extraordinary charges related
largely to a temporary disruption ofthe production ofcertainproducts, were adjusted in H1 2021. These
charges have significantly declined in H1 2022, as the relocation and upgrade of the manufacturing
Jingzhou site in China has been completed and is now at a high level of operation.
Reported Net Income Estimated H1 2021 Estimated Q2 Q2 2021
H1 2022 2022
Net income attributable to 100-130 57 33-63 34
shareholders (USD millions)
Earnings per share (USD) 0.0429-0.0558 0.0244 0.014-0.0269
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