Good results - POT owns 10% of this...company.
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By Tova Cohen
TEL AVIV, Nov 20 (Reuters) - Israel Chemicals (ICL) , a maker of fertilisers and specialty chemicals, on Tuesday reported a 58 percent rise in third-quarter net profit due to strong demand for its fertiliser products.
Net profit in the quarter was a record $149.7 million or 11.6 cents a share compared with $94.8 million or 7.4 cents a year earlier.
Boosted by steep increases in potash and phosphate fertiliser prices and strong demand for those products, sales rose to a record $1.04 billion from $854.3 million a year earlier.
This was offset in part by falling prices and demand for some bromine products and the strengthening of the shekel against the dollar. The results were also affected by higher energy and sea transportation costs.
ICL was forecast to post quarterly net profit of $147 million on revenues of $1.05 billion, according to the average estimate of six analysts in a Reuters poll.
The acquisition in August of Supresta, a maker of phosphorus-based flame retardants, contributed $36 million in revenues, the company said.
Shares in ICL, which have gained more than 70 percent since hitting a year low in February, were down 1.7 percent in afternoon trade. It has a market cap of $13.7 billion.
ICL, which produces about a third of the world's bromine and 10 percent of its potash, benefits from exclusive concessions to extract minerals from Israel's Dead Sea. It also mines phosphate rock from Israel's Negev Desert and potash and salt from its mines in Spain and the UK.
"The results were fair but not good enough," Yisca Erez, an analyst at the Clal Finance Batucha brokerage, said in a note.
The bottom line was boosted by a lower tax rate in the third quarter quarter and excluding this, net profit would have been $123 million, Erez said.
"The shekel and transportation costs are the main influence on the results and will be in the next report as well," Erez said. "Until contracts with China and ... India are signed at higher prices, ICL will have to absorb the increases."
Merrill Lynch analyst Haim Israel said the quarterly numbers were strong and "boosted by a very positive cash margin contribution from the fertiliser segment."
Israel, who rates ICL a "buy", expects the strong trend to continue in the fourth quarter and in 2008.
On the negative side, he said, "transportation prices are going through the roof right now, pushing ICL's margins down."
Separately, Asher Grinbaum, currently president and CEO of ICL Fertilisers, has been appointed chief operating officer of ICL, the company said.
Grinbaum, 57, has been affiliated with the company for 32 years, serving in a variety of capacities including president of Dead Sea Works and president of ICL Industrial Products.
Yossi Shachar, currently president and CEO of ICL Industrial Products, has been appointed as executive vice president for strategy and mergers and acquisitions of ICL.
ICL said it would pay a dividend of $104.8 million on December 17, bringing total dividends paid in 2007 to $543.6 million.
Holding company Israel Corp owns 52.2 percent of ICL while Potash Corp of Saskatechewan owns just over 10 percent.