Bulgarian Fertilizer Powerhouse Neochim Reports Significant Financial Setback in 2023

In a recent disclosure from our sources, Neochim, the renowned Bulgarian fertilizer producer documented striking financial downturn in 2023. The company witnessed a significant shift from a flourishing profit to a significant loss within a year. Having experienced a net profit of around 70 million levs in 2022, the manufacturing giant recorded a consolidated net loss of 39.1 million levs (equivalent to $21.6 million/20 million euro) in 2023.

Revenue Drops by More than Half

The company attributes its financial downside majorly to a sharp decline in the revenue that fell by more than half within a year. The previously recorded revenue of 648.5 million levs in 2022 remarkably plummeted to 300.8 million levs in 2023. Astonishingly, a lion share of the revenue, approximately 289.4 million levs, stemmed from their product sales.

This essential revenue stream also experienced a drastic decrease from earnings of 626.5 million levs in 2022. Compounding the revenue slump, the company observed a contraction in operating expenses. While the company spent 570.5 million levs in the preceding year, the operating expenses reduced to 339.8 million levs in 2023.

Reduction in Material Costs

Interestingly, the cost-saving measures undertaken by Neochim reflected in the significant reduction in the costs of essential materials such as natural gas. Where the expense for natural gas stood at 476.1 million levs in 2022, the subsequent year saw the cost falling to 281.6 million levs. In addition to the raw material costs, the company also incurred 4.9 million levs as other expenses, a significant decline from 42.6 million levs recorded in the previous year.

Net Loss per Share

Further straining the financial structure of the company, Neochim reported a net loss of 15.12 levs per share in 2023, marking a gloomy departure from the net earnings of 27.09 levs per share in the previous fiscal year.

Suspension of Production Facilities

In another key development at the end of 2023, Neochim initiated a gradual suspension of production facilities starting from December 31. The company is set to carry out obligatory technical check-ups and testing of pressurized equipment. This initiative will lead to the resumption of production at the company’s ammonium nitrate and nitric acid plants on March 2.