EANS-News: K+S Aktiengesellschaft / Demand for fertilizers continues to recover K+S Group significantly increases revenues and earnings in the second quarter

K+S Aktiengesellschaft / Demand for fertilizers continues to recover

K+S Group significantly increases revenues and earnings in the second
quarter

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Financial Figures/Balance Sheet/quarterly report/6-month report

Subtitle: K+S Aktiengesellschaft / Demand for fertilizers continues
to recover K+S Group significantly increases revenues and earnings in
the second quarter

Kassel (euro adhoc) - Kassel, 12 August 2010

Demand for fertilizers continues to recover K+S Group significantly
increases revenues and earnings in the second quarter

• Quarterly revenues up by 43% to just under EUR 1.1 billion
• Second quarter operating earnings reach EUR 155.5 million
(Q2/09: EUR 18.1 million)
• Adjusted earnings per share rise to EUR 0.51 (Q2/09: EUR (0.27))
• All business segments with improved earnings situation
• Net indebtedness reduced significantly
• Outlook for 2010:

- Potash sales volume forecast again raised to between 6.5 and 7.0 million
tonnes of goods (previously: a good 6.5 million tonnes; previous year:
4.3 million tonnes)
- Increase in revenues expected to be between EUR 4.6 billion and EUR 5.0
billion (previous year: EUR 3.6 billion)
- Operating earnings should rise to between EUR 550 million and EUR 600
million (previous year: EUR 238.0 million)
- Adjusted earnings per share expected to be between EUR 1.75 and EUR 1.95
(previous year: EUR 0.56/share)

After the successful result in the first quarter, the K+S Group also
achieved a significant increase in revenues and earnings in the
second quarter of this year. The further normalisation in
fertilizer demand and the inclusion of Morton Salt, acquired
last year, were the main drivers of the positive performance.

"The pleasant development so far this year shows that has bottomed
out and that the K+S Group is back on the path to growth," says
Norbert Steiner, Chairman of the Board of Executive Directors of K+S
Aktiengesellschaft. "The positive trend in fertilizer demand is set
to continue in the second half of the year too. Together with
the first-time inclusion of Morton Salt for the entire year, this
should result in significantly rising revenues and earnings of the
K+S Group in 2010."

Second quarter revenues up significantly In the second quarter, the
revenues of the K+S Group rose by about 43% to EUR 1,058.5
million. All in all, volume- and consolidation-related growth was
able to more than make up for decreases in revenues attributable to
price factors. The Salt business segment has significantly
increased revenues through the inclusion of Morton Salt (Morton
Salt revenues Q2/2010: EUR 152.5 million). The Potash and Magnesium
Products and Nitrogen Fertilizers business segments also achieved
welcome revenue increases after the demand for fertilizers
recovered significantly again. At EUR 2,592.1 million, revenues in
the first half of 2010 rose by almost 43% primarily due to volume-
and consolidation-related effects (Morton Salt revenues H1/2010:
EUR 422.3 million).

In the first half of the year, 37% of revenues were generated in the
Potash and Magnesium Products business segment, followed by
Salt (34%) and Nitrogen Fertilizers (26%). The acquisition of
Morton Salt has contributed to the regional distribution of
revenues now being very balanced between Europe and overseas:
thus about 53% of total revenues were generated in Europe and
47% overseas.

All business segments have improved their earnings situation At EUR
155.5 million, second quarter´s operating earnings (EBIT I) of
the K+S Group were very significantly higher than the result of EUR
18.1 million in the previous year. The Potash and Magnesium
Products and Nitrogen Fertilizers business segments increased
their earnings due to the significantly higher demand for
fertilizers that persisted from the start of the year. The earnings
of the Nitrogen Fertilizers business segment benefited to the tune
of EUR 10.0 million from the release of provisions affecting profit
or loss after final settlement of input costs for 2009. Earnings
of the Salt business segment rose significantly due to
consolidation effects. There was also a positive one-off effect in
the area of provisions in the amount of EUR 16.2 million. K+S
Group operating earnings for the first half of 2010 stood at EUR
423.2 million and thus exceeded the figure for the previous year by
about 120%.

EBITDA up sharply in the second quarter During the second quarter
of 2010, earnings before interest, taxes, depreciation and
amortisation (EBITDA) increased to EUR 217.0 million (previous
year: EUR 53.1 million). Depreciation and amortisation amounted to
EUR 61.5 million and were EUR 26.5 million higher in comparison to
the previous year. Of this increase, EUR 20.8 million was
accounted for by the inclusion of Morton Salt. This includes
depreciation on valuations recognised within the framework of
purchase price allocation in the amount of EUR 12.3 million.

In the first half of 2010, EBITDA was EUR 550.1 million (previous
year: EUR 262.2 million). Morton Salt accounted for EUR 96.5 million
of this. The depreciation in this period totalled EUR 126.9 million
and includes depreciation on valuations made within the framework
of the purchase price allocation at Morton Salt in the amount of
EUR 28.5 million. Against this backdrop, greater importance will be
assigned to EBITDA in the future when assessing earnings capacity,
especially in the Salt business segment.

Adjusted earnings also up significantly year on year It proved
possible to increase adjusted Group earnings before income taxes to
EUR 134.0 million in the second quarter (previous year: EUR (58.5)
million). These stood at EUR 371.5 million in the first half of
2010 (previous year: EUR 107.1 million). Adjusted Group earnings
after taxes rose to EUR 97.5 million in the second quarter
(previous year: EUR (44.3) million) and stood at EUR 273.3 million
in the first half of 2010 (previous year: EUR 78.2 million).
Details of the adjustment process can be found in the half-yearly
financial report H1/2010 on pages 11-12.

Adjusted earnings per share reach EUR 0.51 in the second quarter For
the quarter under review, adjusted earnings per share amounted to
EUR 0.51 and were thus significantly higher than a year ago (EUR
(0.27)). In the first half of 2010, they reached EUR 1.43 (previous
year: EUR 0.47).

In the first half of 2010, Morton Salt contributed a total of EUR
0.08 despite a below-average winter, depreciation arising from
purchase price allocation and further one-off effects. Thus, since
the first day of its inclusion in the K+S Group (1 October 2009),
Morton Salt has, despite all acquisition-related special and
customary seasonal effects, contributed positively to the success
of the business in each quarter.

Outlook for 2010: Significant revenue and earnings increase expected
In 2010, demand for fertilizers, and in particular for potash
fertilizers, should increase significantly due to the low
stocks of single-nutrient fertilizers in the trade sector at the
start of the year and due to the lower potash content of the soil
following two very good harvests and the reduced application of
fertilizers since autumn 2008. Furthermore, most of the volumes
demanded by the trade sector in the first quarter in Europe were
consumed by farmers, so that the stocks are again at a relatively
low level before the upcoming autumn fertilizing. Moreover,
the demand for fertilizers should benefit from the persistent dry
weather conditions at the start of the third quarter, the higher
prices for agricultural raw materials in view of this and the
resultant improved future income situation of farmers. In 2010 as a
whole, we now assume global potash sales volumes of about 50 million
tonnes (previous forecast: 45 to 50 million tonnes; 2009: 32
million tonnes). This increased sales forecast mainly assumes a
stronger recovery of the markets in Europe and North America and
higher expected consumption in Latin America.

In the salt sector, the situation of suppliers for the early
procurement business in the third quarter in Western Europe should
benefit from the long winter at the start of the year, while the
mild winter in parts of North America and the related high
stocks are likely to make the position in the local tenders
more difficult. In the fourth quarter, the de-icing salt business
will be influenced decisively by wintry weather conditions in Europe
and North America. In this respect, we are assuming that sales
volumes will be on their multi-year average level in the case of
both the European and North American markets. While demand for
food grade and industrial salt in Europe and North America should
be stable, the South American industrial and food grade salt
market will probably grow further in line with the regional
population trend. Demand from the chemical industry for salt for
chemical use both in Europe and South America is likely to remain
depressed due to the global economic crisis, but sales volumes
should increase moderately again in light of the emerging
economic recovery.

Against this backdrop, in financial year 2010, the revenues of the
K+S Group should rise significantly in comparison to the previous
year. A figure of between EUR 4.6 billion and EUR 5.0 billion
(previous year: EUR 3.6 billion) appears realistic from today´s
perspective. In particular the Salt business segment, which will
grow very significantly due to the first-time inclusion of Morton
Salt for the whole year, but also the Potash and Magnesium
Products and Nitrogen Fertilizers business segments should
experience significant revenue growth.

Operating earnings EBIT I of the K+S Group will probably
also increase significantly to between EUR 550 million and EUR 600
million this year (previous year: EUR 238.0 million). This is
attributable to the earnings increase in the Potash and Magnesium
Products business segment, the turnaround in earnings in the
Nitrogen Fertilizers business segment and the already
described consolidation effect in the Salt business segment.

Based on expected depreciation of about EUR 250 million for
2010 including depreciation on valuations of about EUR 55 million
within the framework of purchase price allocation at Morton Salt,
we expect EBITDA of between EUR 800 million and EUR 850 million
in this year (previous year: EUR 411.8 million).

At between EUR 330 million and EUR 370 million (previous year: EUR
93.6 million), adjusted Group earnings after taxes should also be
significantly higher in 2010 in line with the development of
operating earnings. This would correspond to adjusted earnings
per share of about EUR 1.75 to EUR 1.95 (previous year: EUR 0.56).

Our forecast is based on the following assumptions:

• In comparison to the first half of the year, moderately declining average
prices in the Potash and Magnesium Products business segment due to
expected seasonal product mix and staggered price effects with an
otherwise stable potash price level in the second half of the year;
• A sales volume in the Potash and Magnesium Products business segment of
between 6.5 and 7.0 million tonnes of goods (forecast up to now: a good
6.5 million tonnes);
• A total sales volume in the Salt business segment of 21 to 22 million
tonnes, of which 12 to 13 million tonnes should be accounted for by de-
icing salt. This, as customary, assumes a normal de-icing salt sales
volume at its multi-year average level in the fourth quarter;
• An average US dollar exchange rate of 1.31 USD/EUR for 2010 as a whole
(average exchange rate for 2009: 1.39 USD/EUR);
• In spite of higher interest expenses, a somewhat better financial result,
after this had been negatively impacted by special effects in the previous
year;
• A domestic Group tax rate of 27.9% to be applied in accordance with IFRSs
and an overall adjusted Group tax ratio derived from this of a good 26%
(2009: 23.7%).

Further significant reduction in net indebtedness expected The net
indebtedness (including non-current provisions) of the K+S Group
fell significantly to EUR 862.1 million at the end of the first
half of 2010 (31 December 2009: EUR 1,338.9 million). With a level
of indebtedness of 33% and as a result of both high operating and
free cash flows expected this year, K+S therefore has a strong
financial base. Against the backdrop of the anticipated earnings
development, the level of financial debt should decline
significantly in comparison to the previous year.

Experience growth The K+S Group is one of the world's leading
suppliers of standard and speciality fertilizers. In the salt
business, K+S is the world´s leading producer with sites in
Europe as well as North and South America. K+S offers a
comprehensive range of goods and services for agriculture,
industry, and private consumers which provides growth opportunities
in virtually every sphere of daily life. The K+S Group employs more
than 15,000 people. The K+S share - the only commodities stock on
the German DAX index - is listed on all German stock exchanges
(ISIN: DE0007162000, symbol: SDF). For additional information on
K+S please visit www.k-plus-s.com.

Note to editors The half-yearly financial report (H1/2010), an
interview with Norbert Steiner, chairman of the Board of Executive
Directors of K+S Aktiengesellschaft, about the second quarter of
2010 and up-to-date press photos relating to the K+S Group are
available under http://www.k-plus-s.com/2010h1en.

We are offering a conference call for analysts in English today
at 3 p.m. Norbert Steiner, chairman of the Board of Executive
Directors, as well as Joachim Felker and Jan Peter Nonnenkamp,
members of the Board of Executive Directors, will participate in
the conference call. Shareholders, investors, representatives of
the press and all other interested parties are invited to follow
the conference via a live webcast (http://www.k-plus-s.com/2010h1en)
or by phone (+49-69-71044-5598). The conference will be recorded
and also be available as a podcast.

Contact:
Press:

Michael Wudonig
Phone: +49 561 9301-1262
Fax: +49 561 9301-1666
michael.wudonig@k-plus-s.com

Investor Relations:
Christian Herrmann
Phone: +49 561 9301-1460
Fax: +49 561 9301-2425

christian.herrmann@k-plus-s.com

K+S Aktiengesellschaft
Kommunikation und Medien
Postfach 10 20 29, 34111 Kassel
Bertha-von-Suttner-Str. 7, 34131 Kassel
www.k-plus-s.com
__________________________________________________________

Aufsichtsratsvorsitzender: Dr. Ralf Bethke Vorstand: Norbert Steiner
(Vors.), Joachim Felker, Gerd Grimmig, Dr. Thomas Nöcker, Jan Peter
Nonnenkamp Sitz der Gesellschaft: Kassel; Handelsregister: Kassel HRB
2669

This press release contains facts and forecasts that relate to
the future development of the K+S Group and its companies. The
forecasts are estimates that we have made on the basis of all the
information available to us at this moment in time. Should the
assumptions underlying these forecasts prove not to be correct or
risks arise - examples of which are mentioned in the risk
report -, actual

developments and events may deviate from current expectations. Outside
statutory disclosure provisions, the Company does not take any
obligation to update the statements contained in this press release.

|K+S Group at a Glance | | | | | | |
|Q2/2010 | | | | | | |
| | | | | | | | |
|All figures in accordance with | |Q2 | |Q2 | | |
|IFRSs | | | | | | |
| | | |Apr.-June | |Apr.-June| | |
| | | |2010 | |2009 | |Change |
| | | |EUR million | |EUR million| |in % |
| | | | | | | | |
|Revenues | |1,058.5 | |738.7 | |+43.3 |
| | | | | | | | |
| |Potash and Magnesium Products | |463.5 | |354.3 | |+30.8 |
| |Nitrogen Fertilizers | |287.4 | |257.4 | |+11.7 |
| |Salt | |275.3 | |99.3 | |+177.2 |
| |Complementary Business Segments| |32.2 | |27.6 | |+16.7 |
| |Reconciliation | |0.1 | |0.1 | |- |
| | | | | | | | |
|Operating earnings (EBIT I) | |155.5 | |18.1 | |+759.1 |
| | | | | | | | |
| |Potash and Magnesium Products | |119.2 | |53.8 | |+121.6 |
| |Nitrogen Fertilizers | |26.0 | |(26.6) | |- |
| |Salt | |21.8 | |(0.6) | |- |
| |Complementary Business Segments| |6.2 | |3.2 | |+93.8 |
| |Reconciliation | |(17.7) | |(11.7) | |- |
| | | | | | | | |
|Earnings after operating hedges (EBIT |126.1 | |37.7 | |+234.5 |
|II) | | | | | |
| | | | | | | | |
|Financial result | |(21.5) | |(76.6) | |- |
| | | | | | | |
|Earnings before income taxes | |104.6 | |(38.9) | |- |
| | | | | | | | |
|Earnings before income taxes, | |134.0 | |(58.5) | |- |
|adjusted1) | | | | | | |
| | | | | | | | |
|Group earnings after taxes | |76.3 | |(30.2) | |- |
| | | | | | | | |
|Group earnings after taxes, adjusted1)| |97.5 | |(44.3) | |- |
| | | | | | | | |
|Earnings per share, adjusted (EUR)1)|0.51 | |(0.27) | |- |
| | | | | | | | |
|Capital expenditure2) | |34.4 | |41.5 | |(17.1) |
| | | | | | | |
| | | | | | | | |
|1) The adjusted key figures only contain the earnings actually realised |
|on operating forecast hedges for the respective reporting period. The |
|changes in the market value of operating forecast hedges still |
|outstanding, however, are not taken into account. Any resulting effects |
|on deferred and cash taxes are also eliminated; tax rate Q2/10: 27.9% |
|(Q2/09: 27.9%). |
| |
|2) Cash-effective investments in or depreciation on property, plant and |
|equipment, intangible assets. |

|K+S Group at a Glance | | | | | | |
|H1/2010 | | | | | | |
| | | | | | | | |
|All figures in accordance with | |H1 | |H1 | | |
|IFRSs | | | | | | |
| | | |Jan.-June | |Jan.-June| | |
| | | |2010 | |2009 | |Change |
| | | |EUR million | |EUR million| |in % |
| | | | | | | | |
|Revenues | |2,592.1 | |1,814.4 | |+42.9 |
| | | | | | | | |
| |Potash and Magnesium Products | |961.9 | |720.3 | |+33.5 |
| |Nitrogen Fertilizers | |672.9 | |599.5 | |+12.2 |
| |Salt | |891.7 | |437.6 | |+103.8 |
| |Complementary Business Segments| |65.4 | |56.7 | |+15.3 |
| |Reconciliation | |0.2 | |0.3 | |(33.3) |
| | | | | | | | |
|Operating earnings (EBIT I) | |423.2 | |192.1 | |+120.3 |
| | | | | | | | |
| |Potash and Magnesium Products | |269.8 | |150.8 | |+78.9 |
| |Nitrogen Fertilizers | |40.5 | |(18.5) | |- |
| |Salt | |129.7 | |79.6 | |+62.9 |
| |Complementary Business Segments| |12.6 | |5.2 | |+142.3 |
| |Reconciliation | |(29.4) | |(25.0) | |- |
| | | | | | | | |
|Earnings after operating hedges (EBIT |389.0 | |190.6 | |+104.1 |
|II) | | | | | |
| | | | | | | | |
|Financial result | |(51.7) | |(85.0) | |- |
| | | | | | | |
|Earnings before income taxes | |337.3 | |105.6 | |+219.4 |
| | | | | | | | |
|Earnings before income taxes, | |371.5 | |107.1 | |+246.9 |
|adjusted1) | | | | | | |
| | | | | | | | |
|Group earnings after taxes | |248.6 | |77.1 | |+222.4 |
| | | | | | | | |
|Group earnings after taxes, adjusted1)| |273.3| |78.2 | |+249.5 |
| | | | | | | | |
|Earnings per share, adjusted (EUR)1)|1.43 | |0.47 | |+204.3 |
| | | | | | | | |
|Capital expenditure2) | |61.7 | |70.6 | |(12.6) |
| | | | | | | |
|Employees as of 30.06. (number) | |15,102 | |12,233 | |+23.5 |
| |of which trainees (number) | |495 | |483 | |+2.5 |
| |
|1) The adjusted key figures only contain the earnings actually realised |
|on operating forecast hedges for the respective reporting period. Changes|
|in the market value of operating forecast hedges still outstanding, |
|however, are not taken into account. Any resulting effects on deferred |
|and cash taxes are also eliminated. |
| |
|2) Cash-effective investments in or depreciation on property, plant and |
|equipment, intangible assets. |

end of announcement euro adhoc
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ots Originaltext: K+S Aktiengesellschaft
Im Internet recherchierbar: http://www.presseportal.de

Further inquiry note:

Contact:

Press:

Michael Wudonig

Phone: +49 561 9301-1262

Fax: +49 561 9301-1666

michael.wudonig@k-plus-s.com

Investor Relations:

Christian Herrmann

Phone: +49 561 9301-1460

Fax: +49 561 9301-2425

christian.herrmann@k-plus-s.com

K+S Aktiengesellschaft

Kommunikation und Medien

Postfach 10 20 29, 34111 Kassel

Bertha-von-Suttner-Str. 7, 34131 Kassel

www.k-plus-s.com

__________________________________________________________

Aufsichtsratsvorsitzender: Dr. Ralf Bethke

Vorstand: Norbert Steiner (Vors.), Joachim Felker, Gerd Grimmig, Dr. Thomas
Nöcker, Jan Peter Nonnenkamp

Sitz der Gesellschaft: Kassel; Handelsregister: Kassel HRB 2669

Branche: Chemicals
ISIN: DE0007162000
WKN: 716200
Index: DAX, Midcap Market Index, CDAX, Classic All Share, HDAX,
Prime All Share
Börsen: Frankfurt / regulated dealing/prime standard
Berlin / regulated dealing
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Stuttgart / regulated dealing
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Hannover / regulated dealing
München / regulated dealing