Abu Dhabi-based Fertiglobe has proposed a firs half-year dividend of $750 million, higher than the previous guidance, after revenues more than doubled in the second quarter.

The fertilizer company, a joint venture between state energy firm ADNOC and Dutch chemical producer OCI, reported on Tuesday a Q2 net profit attributable to owners of $429.4 million compared with $113.3 million in the previous year.

The profit beat analysts’ mean estimate of $414 million, according to data provider Refinitiv.

Revenues for the quarter more than doubled to $1.47 billion. Free cash flow increased to $789 million in Q2 2022 from $328 million a year ago, supporting a first-half dividend of $750 million, which is higher than the previous guidance of at least $700 million, the company said.

"The outlook for the fundamentals of our nitrogen end markets continues to be underpinned by tight supply, healthy farm economics and low grain stocks globally that incentivize the use of nitrogen fertilizers. Forward curves imply that natural gas prices in Europe will remain at elevated levels through 2023 and beyond, setting break-even pricing well above historical average global prices for ammonia and urea," said Ahmed El-Hoshy, CEO.

He said the company, which has low leverage position, will look at pursuing value-creative growth opportunities, "including organic expansions below replacement cost, capitalizing on the emerging demand for low-carbon ammonia as a solution to decarbonize industries that make up around 90% of current global greenhouse gas emissions".

The robust performance was due to strong in-season demand, tight market balances and elevated gas prices in Europe, as well as higher sales volumes due to a phasing of some shipments from Q1 2022 to this quarter, the company said

Net profit for the first half of the year jumped to $786 million from $198.5 million in the previous period.

(Reporting by Brinda Darasha; editing by Cleofe Maceda)