ICL Group Ltd. reported mixed results for the second quarter of 2024, with profits declining year-over-year but still surpassing analyst expectations. The company recorded a profit of $115 million, or 9 cents per share, down from $163 million, or 13 cents per share, in the same period last year. However, adjusted earnings per share, excluding one-time items, reached 10 cents, beating the Zacks Consensus Estimate of 9 cents.
Revenue also saw a decline, falling by approximately 6% year-over-year to $1,752 million. Despite this dip, the figure exceeded the Zacks Consensus Estimate of $1,733.2 million.
Segment performance varied. The Industrial Products segment saw a 5% year-over-year increase in sales, reaching $315 million. EBITDA remained flat at $74 million, marking the third consecutive quarter of sequential improvement, driven by cost-saving measures and strengthened customer relationships.
The Potash segment experienced a significant drop in sales, declining by 27.5% year-over-year to $422 million. EBITDA also fell by 44% year-over-year to $118 million.
In contrast, the Phosphate Solutions segment saw a slight increase in sales, growing by 1% year-over-year to $572 million. EBITDA rose by 13% year-over-year to $146 million, marking the second consecutive quarter of sequential sales improvement. While pricing remained stable during the quarter, evolving supply dynamics are expected to impact future performance.
The Growing Solutions segment also showed positive growth, with sales rising by 3% year-over-year to $494 million. EBITDA nearly doubled from $22 million in the same period last year to $45 million.
Looking at the company’s financial position, ICL had $287 million in cash and cash equivalents at the end of the quarter, down around 23% year-over-year. Long-term debt stood at $1,850 million, a decrease of nearly 13% year-over-year. Cash provided by operating activities reached $316 million in the reported quarter.
ICL updated its full-year 2024 guidance, now projecting specialties-driven EBITDA of $0.8 billion to $1 billion, compared to the previous guidance of $0.7 billion to $0.9 billion. The expected potash sales volumes remain unchanged, in the range of 4.6-4.9 million metric tons.
Over the past year, ICL’s shares have lost 31.1% of their value, compared to a 23.9% decline in the industry.
The company currently carries a Zacks Rank #3 (Hold). For investors seeking exposure to the Basic Materials sector, Newmont Corporation (NEM), Franco-Nevada Corporation (FNV), and Agnico Eagle Mines Limited (AEM) are considered better-ranked stocks. Newmont and Franco-Nevada both hold a Zacks Rank #1 (Strong Buy), while Agnico Eagle carries a Zacks Rank #2 (Buy).
Newmont’s current-year earnings are expected to reach $2.82, indicating a 75% year-over-year increase. The consensus estimate for NEM’s earnings has risen by 16% in the past 60 days, and the stock has gained nearly 28.8% in the past year.
FNV’s current-year earnings are projected to reach $3.27. The consensus estimate for FNV’s earnings has increased by 3% in the past 60 days, and FNV has exceeded analyst expectations for the past four quarters, with an average earnings surprise of 10.5%.
AEM’s current fiscal year earnings are estimated at $3.65, representing a year-over-year increase of 63.7%. AEM has consistently surpassed analyst expectations for the last four quarters, with an average earnings surprise of 15.7%, and its shares have risen by 70% in the past year.
