November 1, 2018 / 9:44 PM / 15 days ago

Australia's Orica posts 16 percent fall in annual underlying profit

(Reuters) - Australia’s Orica Ltd (ORI.AX), the world’s top supplier of commercial explosives, said on Friday annual underlying profit fell 16 percent, hurt by unplanned maintenance shutdowns as well as operational issues at the Burrup plant.

Underlying profit, a measure of earnings that excludes one-off gains and losses, fell to A$324.2 million ($233.55 million) for the year ended Sept. 30 from A$386.2 million a year ago.

The company declared a final dividend of 31.5 Australian cents per share, up from the 28 cents per share a year earlier.

Total ammonium nitrate volumes were up 5.0 percent year-on-year, helped by higher demand in Indonesia and Australia.

However, the volume growth was offset by unfavorable contract pricing, the company said, adding that earnings before interest and taxes was further impacted by unplanned maintenance shutdowns at Yarwun and Kooragang Island operations in Australia.

Burrup plant, the joint venture in Western Australia between Orica and Norwegian partner Yara International, is expected to be operational by the end of the FY2018, with the replacement of some key components expected to delay production until the first half of FY20.

The impact of contract pricing for the year was lower than previously expected due to the deferral of some contract re-negotiations to the 2019 financial year, the company said.

Reporting by Chandini Monnappa and Aby Jose Koilparambil in Bengaluru; Editing by Tom Brown

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