PhosAgro Board of Directors Welcomes Signing of New Collective Bargaining Agreements at Group Enterprises

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August 30, 2023 (press release) –

The Board of Directors of PJSC PhosAgro, one of the world’s leading producers of phosphate-based fertilizers, welcomed, at its meeting today, the signing of new collective bargaining agreements at all Group enterprises. 

At an offsite meeting held at the Company’s plant in Volkhov, which will reach its design capacity of 1 million tonnes this year, the Board reviewed reports from PhosAgro’s CEO and Management Board for 1H 2023. 

As PhosAgro CEO Mikhail Rybnikov noted in his report, the Company has been demonstrating robust performance thanks to the consistent implementation of its investment programme, for which a record RUB 67 billion has been earmarked for this year:

“In the first six months of the year, production of agrochemicals increased by 4.3% year-on-year to over 5.6 million tonnes. I would also like to highlight the phosphate-based fertilizer segment – MAP, DAP and liquid complex fertilizers – where production increased by 19% to more than 2.4 million tonnes. The main growth driver was the construction of a state-of-the-art complex for the production of phosphate-based fertilizers in Volkhov. Thanks to the radical overhaul and new construction carried out at the site, annual production of mineral fertilizers and other chemicals will exceed 1 million tonnes. In the first half of the year, the new million-tonne plant mastered the production of water-soluble MAP and launched a project to increase the processing of phosphate rock. 

“The Company also continues developing its ore and raw material base: the second start-up complex for the 10th horizon at the Kirovsky mine is scheduled to come online in the fourth quarter. PhosAgro continues to modernise and increase the capacity of its production facilities. In Cherepovets, in addition to modernising the ammonia, phosphoric acid and sulphuric acid production facilities, a project has been launched to increase the processing of phosphate rock. In Balakovo, projects will be completed in the fourth quarter to increase the production of feed phosphates as well as sulphuric acid output as part of the third stage in the development of the production complex.” 

Viktor Cherepov, Chairman of PhosAgro’s Board of Directors, emphasised that it was no accident that the results of PhosAgro’s 10-year investment cycle were being summed up in Volkhov: 
“It is here that we are completing our largest-ever investment project, the result of which is the construction of an extraordinary new plant for the production of mineral fertilizers. RUB 34 billion has been invested in the site; over 10 years, more than RUB 390 billion has been invested in the Company. The investment cycle has resulted in an 80% increase in the output of our core product, from 6.1 million tonnes in 2013 to 11.1 million tonnes in 2022. Our production-related successes enabled us to double our supplies of eco-efficient products to our priority domestic market over the course of a decade: from 1.5 million to 2.9 million tonnes. Labour productivity increased 170% over the same period. In the future, we will continue to follow our chosen development strategy: we intend to invest more than RUB 250 billion in the next five years.

“Thanks to our dynamic development, continuous improvement of production efficiency and excellent production results, we are able to focus on sustainability and social responsibility. Over the past 10 years, our support for social and charitable projects has increased sevenfold, from RUB 1.9 billion to RUB 12.9 billion, average salaries across the Group have increased 150%, and investments in environmental activities have increased by more than RUB 60 billion. 

“It is symbolic that new collective bargaining agreements were signed yesterday at all PhosAgro Group production sites. The Company once again expanded its benefits package for workers in Volkhov, Cherepovets, Kirovsk and Balakovo. This is a landmark event both for our sector and for the domestic chemical industry as a whole. In addition, the acceptance of a new residential building that the Company built for its employees in Volkhov took place today. Thanks to the corporate housing programme, the families of more than 2,700 of our chemists and miners have improved their living conditions. 

“This year marks the 10th anniversary of PhosAgro’s corporate education programme, which involves a full cycle of training and support for specialists that follows a pathway from school to vocational school or university to employment with the Company. The programme covers six schools and four sponsored colleges in all the regions where the Company operates. We collaborate closely with 24 leading specialised institutions of higher learning. 

“Since 2013, 83 PhosAgro Schools graduates have found employment with the Company, and another 36 graduates plan to do so this year. Over the past 10 years, 994 PhosAgro Schools graduates have enrolled in higher education institutions, which is 88% of the total number of students who have receiving training at sponsored schools. The relevant committee of the Federation Council recommended that the experience of PhosAgro’s educational model be taken into account in the development of education–production clusters in key industries. Over 10 years, the Company has allocated RUB 4.2 billion for the programme’s implementation.”

The Board of Directors heard a report on the Company’s work on international projects in 2022 and the first half of 2023, and also took note of information provided by the chairs of the Company’s Board committees on the work of those committees. The Board of Directors recognised that its independent members met the independence criteria set out in the Regulation on the Board of Directors of PJSC PhosAgro, the Corporate Governance Code recommended by the Bank of Russia for use by joint-stock companies, the Moscow Exchange Listing Rules and the UK Corporate Governance Code.

The Board also reviewed PhosAgro’s financial results for 1H 2023, including its IFRS interim consolidated financial statements. The Board decided to hold an Extraordinary General Meeting of Shareholders on 30 September 2023 in the form of absentee voting and approved its agenda, which will include the issue of dividend payments for 1H 2023. The Board of Directors recommended that PhosAgro’s General Meeting of Shareholders decide to pay dividends at the rate of RUB 126 per share. The list of persons entitled to participate in the meeting will be drawn up on the basis of the information available in the Company’s shareholder register as of 8 September 2023.

In addition, a new version of the Company’s budget for 2023 was approved and recommended for approval by the Management Board. The Board of Directors reviewed a report on the Company’s compliance with legal provisions concerning the protection and handling of insider information for 2022 and 1H 2023, as well as on the main requirements under Russian and European laws for persons discharging managerial responsibilities (PDMR).

Information on occupational health and industrial safety at PhosAgro companies was noted, as were the results of the monitoring of key risk management at the Company in 2Q 2023. Information was heard on the implementation of measures outlined in the Company’s climate strategy. 

The Board of Directors determined the amount of remuneration to be paid for the services of the Company’s independent RAS auditor and heard a report on the Company’s work with investors in 2022 and 1H 2023. The Board approved a report on the work of the corporate secretary for the same period and also approved an amended version of the Company’s Policy on the Selection of External Auditors and Guidelines for Establishing Relations with Them. 




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