ICL Reports Strongest Quarterly Profit in Three Years Driven by Potash Price Surge
ICL, the Israeli fertilizer and chemical company, reported robust financial results for the second quarter of 2026, marking its strongest operational quarter in three years. The company benefited from continued increases in potash prices, along with higher phosphate prices and sales volumes of potash and bromine-based products. Revenues for the quarter reached $2.35 billion, a 17% increase year-over-year. Operating profit rose 47% to $266 million, adjusted EBITDA grew 28% to $448 million, and net profit attributable to shareholders surged 47% to $137 million. Despite challenges from a weaker dollar and rising raw material costs, all four business segments saw revenue growth, with the potash and industrial segments driving most of the profit improvement.
In the potash segment, which includes potash, salts, and magnesium products from the Dead Sea, sales increased 22% to $468 million, and operating profit jumped 63% to $85 million. This was fueled by a 13% rise in sales volumes, mainly to China, Brazil, and India, totaling 1.081 million tons, and a 14% increase in average potash prices to $376 per ton. In June, ICL signed a contract to supply 375,000 tons of potash to an Indian customer, with an option for an additional 50,000 tons at $383 per ton.
The industrial segment, largely based on bromine products, also saw significant gains with sales up 30% to $414 million and operating profit more than doubling from $54 million to $115 million, driven by higher sales volumes and prices of flame retardants. Conversely, the phosphate segment, ICL's largest by sales, experienced a 13% revenue increase to $722 million but an 11% decline in operating profit to $80 million due to rising raw material costs and supply chain disruptions, including Chinese export restrictions. Demand softened in Brazil and remained low in the U.S. The growing solutions segment, focused on specialty fertilizers and plant nutrition, saw 20% revenue growth to $605 million but a 9% drop in operating profit to $32 million due to higher input costs and currency effects.
Following these results, ICL confirmed its previous guidance, expecting adjusted EBITDA for 2026 to range between $1.5 billion and $1.7 billion, and potash sales to reach 4.5 to 4.7 million tons. The company is also implementing an organizational restructuring effective early 2027, consolidating its activities into four sectors: Nutrition Solutions, Industrial Products, Growing Solutions, and Essential Minerals. Additionally, ICL is pursuing a cost-saving program aiming to reduce expenses by $350 million by the end of 2028, with benefits starting in early 2027. Despite the strong quarter, ICL's stock has declined 24% over the past year amid investor concerns about losing its Dead Sea concession in 2030, while the Tel Aviv 125 index rose 35% during the same period.
ICL announced it will distribute a $75 million dividend in September following the earnings release.
