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German minerals group K+S expects slightly positive 2021 net result

March 11 (Reuters) - German minerals miner K+S expects to turn a slight net profit in 2021, despite confirming a net loss of 1.8 billion euros ($2.2 billion) with its final 2020 results on Thursday.

By 0930 GMT, shares in the salt and potash fertiliser supplier had risen 1.4%, making up for losses after the company had said it would not pay a dividend for 2020.

“In 2023 at the latest, we should be able to achieve positive free cash flow,” Chief Executive Burkhard Lohr said.

K+S reported an outflow of free cash to the tune of 42 million euros in the full year, which was narrower than a consensus provided by the company of an outflow of 51 million euros. Since 2013, the company has reported a positive cash flow only once, in 2019.

The group, which is aiming to reduce debt levels that had soared after its investment in a new potash mine in Canada, in October signed an agreement to sell its North and South American salt business to Stone Canyon Industries Holdings and affiliates for $3.2 billion.

K+S said strong demand for potash and the rising prices of the fertilizer, together with an above-average demand for de-icing salt overall in the first quarter, helped the company start the year well.

On Tuesday, the company released preliminary results, saying it expected a rise in core profit in 2021, helped by a one-off gain, after 2020 core earnings beat analysts’ forecasts. It said its auditor had confirmed than an impairment loss being examined by Germany’s Audit Office for Accounting should not have been recognized earlier. ($1 = 0.8359 euros) (Reporting by Bartosz Dabrowski in Gdansk; Additional reporting by Anna Rzhevkina; Editing by Hugh Lawson)

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