Strong EBITDA Growth
EBITDA excluding special items of $896 million in Q1, up 40% year-on-year, driven by higher nitrogen upgrading margins in a tight market.
Yara International
· YARIY
April 24th, 2026
Summary
- Earnings Call Date:
- 2026-04-24
- Change Since:
- -19.93%
- Next Earnings Date:
- 2026-07-17
Earnings Call Sentiment
PositiveThe call presents a broadly positive commercial and financial performance: strong EBITDA (+40%), EPS (+60%), ROIC (12.2%) above target, improved free cash flow and demonstrable operational resilience and cost discipline. These positives are tempered by serious lowlights — notably deteriorating safety with 59 recorded accidents, significant market disruption from the Middle East conflict (disrupting ~1/3 of traded urea and driving large price spikes), production outages (Pilbara and Belle Plaine) and pressure on premiums and certain product lines. Overall, the company appears financially robust and operationally resilient, but faces material operational, safety and market risks that require active management.
Company Guidance
Yara’s guidance emphasized operational resilience and disciplined capital allocation rather than specific forward volume or price guidance: Q1 EBITDA excl. special items was USD 896m (+40% y/y) with EPS up ~60%, return on invested capital at 12.2% (vs 6% a year ago and above the >10% through‑the‑cycle target), and last‑12‑month EBITDA ~USD 3bn with accumulated cash flow ~USD 1.2bn; free cash flow improved by USD 196m despite a USD 35m increase in operating capital. Management reiterated no gas hedging (gas effects lag ~2 months) and the ability to import ammonia to keep finished‑goods output; Crop Nutrition deliveries were +3% y/y and Europe season‑to‑date +2.5% (EU urea imports Jan–Mar 4.2m t vs 4.9m), while market shocks have pushed urea +47% since February (Egypt FOB +77%). Operational headwinds include Belle Plaine turnaround (~150,000 t urea) and Pilbara outage (~140,000 t ammonia), fixed costs on a 12‑month basis at ~USD 2.3bn (down ~USD 230m vs Q2‑24) and a further USD 18m y/y cost reduction, and the improvement program targets >USD 200m EBITDA by end‑2027 and USD 350m by end‑2030 while pursuing up to +1.0m t of premium‑product growth and selective energy diversification projects (NEOM/US timelines).
Significant EPS Improvement
Earnings per share increased ~60% year-on-year as depreciation, interest and tax remained stable.
Return on Invested Capital Above Target
ROIC doubled from 6% to 12.2% on a rolling 12-month basis, exceeding the through-the-cycle target of 10%.
Improved Free Cash Flow and Strong 12‑month Cash Generation
Free cash flow increased by USD 196 million in the quarter (net investments flat). Last 12 months accumulated cash flow close to USD 1.2 billion and EBITDA up about USD 3 billion.
Delivery and Volume Execution
Crop Nutrition deliveries rose 3% vs Q1 last year; Europe season-to-date deliveries up ~2.5% and among the highest in the last five years; overall volumes and customer deliveries increased reflecting strong commercial execution.
Fixed Cost Reduction and Cost Discipline
Fixed cost level on a 12-month basis at USD 2.3 billion, down approximately USD 230 million from Q2 2024; additional fixed cost reduction of USD 18 million vs prior year noted.
Operational Resilience and Energy Flexibility
Yara maintained high finished-goods production and uptime through global optimization and the ability to import ammonia, enabling continuity of supply during market disruptions.
Clear Improvement Program and Growth Targets
Improvement program targeting >USD 200 million EBITDA uplift by end-2027 and USD 350 million by end-2030; organic growth ambition up to 1 million tonnes of premium products and multiple expansion projects progressing.
Maria Gabrielsen
Welcome to Yara's First Quarter Results Presentation. The presentation today will be held by Yara's CEO, Svein Tore Holsether; and Yara's CFO, Magnus Krogh Ankarstrand. I would like to mention that we have a change in how we do our Q&A session today. Once the presentation is done, we will move straight into the Q&A session. [Operator Instructions] But first, let's start the presentation. It is my pleasure to hand over to our CEO, Svein Tore Holsether.
Svein-Tore Holsether
Thank you, Maria. Good morning, good afternoon, good evening, depending on where you're dialing in from. And thank you for joining our first quarter presentation. As always, I'm starting with our safety performance. Our license to operate is creating a safe working environment for all our employees and contractors. And we have a lot to be proud of our performance in the first quarter, but safety is not one of them. We continue to see an increase in accidents, and this has also been the case in April, which means that we will likely see further deterioration as we get into the second quarter. And there is only one responsible for it, and that is me.
And I take that responsibility very seriously. I'm now in my 30th year in industry. And what I've learned from safety is that you cannot dictate your way to safety and also that campaigns, they only have a short-term impact. It is what we do every day, every week and every year that matters. And we know what to do. We will continue to work according to our Safe by Choice approach that has now been in place for 12 years. This is our joint commitment to safety throughout the whole org...
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