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PhosAgro Board Members Visit Production Sites

16 September 2014
Moscow – The Board of Directors of PhosAgro (Moscow Exchange, LSE: PHOR) visited the company’s main production sites, PhosAgro-Cherepovets and Apatit, on the eve of the Company’s Extraordinary General Meeting of Shareholders.

PhosAgro CEO Andrey Guryev said: “The Board of Directors, who are tasked with determining the Company’s sustainable growth strategy, decided to review the quality of the work and the management of the assets where PhosAgro’s main investment projects are currently underway.  This is an important part of our work on developing recommendations to further strengthen PhosAgro’s position as a global leader in the production of Phosphate-based fertilizers, as well as for identifying and mitigating risks related to the implementation of our strategic goals.”

At PhosAgro-Cherepovets, the Board members were shown the urea production line and power generation plant that were launched in 2012, and heard about plans for the construction of new ammonia and urea production capacities. PhosAgro-Cherepovets has undergone a series of modernisations and renovations in recent years to increase efficiency.

PhosAgro Board of Directors Chairman Sven Ombudstvedt said: “It was very important for the Board of Directors to see how PhosAgro’s main production facilities are developing and to see first-hand how the major investment projects approved by the Board are being implemented.  The Company’s investment programme includes new production lines for ammonia, urea and other products.

“The work due to be completed over the next 3-4 years will result in a significant expansion of PhosAgro’s production capacity, which will be a serious step toward strengthening the Company’s competitive strengths.  The goals we have set before ourselves are quite challenging, but with experience implementing similar projects and people confident in their ability, I am sure that PhosAgro will succeed.”

The Chairman of the Board of Directors of PhosAgro paid special attention to the need to increase efficiency, both in the implementation of investment projects and at existing PhosAgro-Cherepovets production lines.

Sven Ombudstvedt added, “We must increase the efficiency of technical maintenance programmes.  It is especially important to pay attention to workplace safety and environmental protection.”

PhosAgro CEO Andrey Guryev supported Sven Ombudstvedt’s opinion.

Andrey Guryev said, “In terms of the technology and equipment at our production facilities, PhosAgro is one of the leading fertilizer producers in the world. With modern production lines built using the best available technologies, we must ensure that they work efficiently, using leading practices in industrial and workplace safety and environmental protection.”

At Apatit, the world’s largest producer of high-grade phosphate rock, Board members visited ore shaft No 2 at the Kirovsky underground mine, the construction of which will help to increase mining volumes to 14 million tonnes per year by 2016. The Board members also had a demonstration of PhosAgro’s recently-installed automated fleet dispatch system, which uses computers and GPS locators to maximise the efficiency of the Company’s mining fleet.

PhosAgro Board of Directors member Marcus Rhodes said: “Thanks to implementation of the strategy in the areas of modernisation and expansion of production facilities, as well as improving corporate governance, the Company is well-positioned to increase its market capitalisation and strengthen its competitive position.

“After visiting the beneficiation plant and the underground mine, I was pleased with what I saw and impressed with the high quality of the equipment, as well as the efficient way in which production processes are organised.

“I have seen many Russian management teams, but the people I met here left an especially strong impression – they are well-qualified, with a clear understanding of the technical aspects of their production facilities and the role that each of their divisions play in the overall production system at the site.

“Through successful implementation of the modernisation goals set out in its strategy, PhosAgro has succeeded in upgrading these production facilities to be on a par with some of the best in the world. Constant efforts to improve efficiency, combined with flexible production and sales models, mean that PhosAgro is able to sell its high-quality fertilizer products at premium prices nearly anywhere in the world, which delivers healthy profitability levels.”