THE BOARD OF DIRECTORS OF PJSC TOAZ HAS APPROVED THE STRATEGY TILL 2025

The Board of Directors of Public Joint-Stock Company Togliattiazot (PJSC TOAZ, the Company), the largest producer of ammonia in Russia, has approved a new strategy for the Company till 2025.

The strategy verbalizes the mission of Togliattiazot, which the management and members of the Board defined as: “We care about land fertility and crop yield for the benefit of the whole world.” The document states that the company’s vision is to become a leader in the production of nitrogen fertilizers in Russia and rank in the Top 5 largest producers in the world.

To achieve this goal, the strategy implies an increase in output (including ammonia by about 40% to 4.15 M tons per annum (tpa), and urea by more than 2.5 times to 2.53 M tpa) and an increase in EBITDA by 3.3 times.

The new strategy of PJSC TOAZ outlines strategic initiatives that will allow the company to achieve the stated vision, as divided into 3 blocks: improving the operational efficiency, increasing the commercial efficiency, and production site development.

In order to increase the operational efficiency of Togliattiazot, it is planned to align the repairs function with the best practices in terms of the frequency and duration of turnaround maintenance, to increase the labour efficiency, and to reduce gas consumption rate.

Changes in sales structure in the foreign and domestic markets, as well as improving in commercial terms for the core products with key buyers are expected to help enhance the commercial efficiency of PJSC TOAZ.

The following targets are stated in the “production site development” block: construction of urea plant No. 4 and an ammonium nitrate and a carbamide-ammonia mixture unit to add new products to the portfolio, completion of construction of the fertilizers’ transshipment terminal in Taman, and improvement in the productivity of ammonia production units.

Investments in the development of production capacities and an increase in production volumes will amount to RUB 112 billion (approx. US$ 1.8 bn as of Dec. 23rd, 2019).

Petr Ordzhonikidze, PJSC TOAZ Chairman of the Board, commented on the adoption of the strategy till 2025: “The new strategy shows an ambitious vision that reflects the leadership aspirations of not only the management, but also the entire team of Togliattiazot. We believe that the stated targets for the medium term are absolutely realistic, since a lot of work has been done as a part of the strategic modernization program over the past 7 years: more than RUB 33 billion has been invested in upgrading the production facilities of PJSC TOAZ. The next step, as recorded in the new strategy, is the production development, product portfolio expansion, better marketing so that products of Togliattiazot become a synonym of efficient agriculture all over the world.”

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