Let us start with the good news, though. Since November 13th 2008, the company Alkimia has a new Managing Director, «Ali Mhiri». This latter takes over Ali Ben Ali, who retired, in special and rather difficult conditions. The enterprise, subsidiary of the Tunisian Chemical Group (GCT), is indeed strongly impacted by the sky-rocketing prices of its main material which is the phosphoric acid that it buys from the GCT, which is itself impacted by the rising sulfur prices. This acid is the basic material of the STPP which is sold to international manufacturers of detergents, Proctor, Henkel and Unilever.
These manufacturers, have indeed disrupted all purchases from Alkimia, which did not sell anything from last September and which was in the obligation of slowing if not technical disruption in its factory in Gabès. As a matter of fact, for a monthly production of 12 thousand tons of STPP, Alkimia sold in September 2008 only 1699 tons, in October 506 tons and in November of the same year 700 tons. These sales were held back by the the sky-rocketing acid prices which rose to 2630 Usd the ton last August and decreased to 1700 Usd in September. The STPP of Alkimia is hence becoming non-competitive, among detergent manufacturers who developed since then polymères and enzymes, a lot cheaper products, to replace the STPP.
We should note, here, that the GCT, unique supplier of Alkimia, had bought enormous quantities of sulfur when prices were higher (650 Usd) and stocked them (300 thousand tons according to some estimates) to have a stock of 30 thousand tons of phosphoric acid whose production price, 1200 Usd the ton, made it almost impossible to sell in the current phosphate market conjecture where the two main producers (Morocco with 30 million tons and Tunisia with 8,5 million tons), are trying to improve the international price in the acid market so as to sell their stocks. The major shareholder of Alkimia is not ready for the time being to decease the acid price, not even for his subsidiary, which as a result cannot sell any more.
2008, a year with a deficit !
Alkimia losses, for the year 2008 which is financially closed, should be of 3 to 4 MDT, without the 12 other million DT in supply for the coming year 2009. To September 30th, the company with a float of 5 % on the Tunis Stock Market, will have registered a deficit of 1 MDT, against a profit of 7 MDT at the end of the first semester 2008. To December 31st this year, the enterprise should have a loss of at least 2 MDT. Presently, and despite a rising turnover (170 MDT against 122 MDT in 2007), the enterprise cash-flow should end the year with a negative note for Alkimia which will have a 50 MDT debt to pay back to its reference shareholder the GCT.
But this is not the end of the story: According to the enterprise management forecast, if the GCT does not find a solution to its stocks of acid, if it does not decide to supply it with a loss, from now till the end of the year, Alkimia should undergo commercial hardships for about 6 months. This critical situation, is all the more grotesque that it would be almost cheaper for its major shareholder to “subsidise” the slowdown of Alkimia, than sell its acid for a price that would make its STPP «buyable» by international detergent manufacturers.
Annaba and «Om Elkhialet» in ballotage.
This very difficult situation for the enterprise, occurs at the time when the Alkimia factory should be launched in Annaba, Algeria. Its STPP production of 5000 tons per month would then be added to the unsold stock of 20 thousand tons of the mother company. In front of such prospects, the Tunisian management of the group Alkimia, would opt for postponing the start of its factory in Annaba which was to take place in the beginning of next year. However, the enterprise hopes that the new regulations decided by the Tunisian and Algerian authorities concerning the tax exemption for some products would help it to have a 15% competitiveness margin to be able to sell its STPP in the Algerian market.
Alkimia, with already the permission to reseach sodium sulfate, a complementary salt for the STPP, the permission of the Sebkha of Om Elkhialet in the South of Tunisia, should also postpone the start of this project which needed an investment of 35 to 50 MDT, partly in proper funds (these are becoming so rare) and the rest to levy on the Tunisian financial market (in quite unfavourable conditions).
For the time being, Alkimia sells very little STPP, its Tunisian supplier of acid refuses to decrease its price, there is a technical disruption in the factory of Gabès, and only maintenance activities are being carried out to keep its permanent staff of 305 workers whose salary mass is estimated at 7 MDT. Going for adventure !
