* Q1 EBIT I 174 mln eur, down 23 pct
* Still sees marked decline in sales, earnings in 2009
* Demand for salt shores up earnings
(Adds details, background)
FRANKFURT, May 13 (Reuters) - German fertiliser supplier K+S SDFG.DE reiterated that is sees a notable decline in 2009 earnings even after it posted first-quarter operating proft that beat expectations on Wednesday.
The world’s fourth-biggest potash maker said operating profit excluding currency hedging instruments fell 23 percent to 174 million euros ($237.2 million) in the three months through March as farmers hoping for lower prices delayed ordering potassium chloride, the fertiliser ingredient that K+S extracts from potash ore.
Still, that surpassed the 119 million euro average forecast in a Reuters poll of analysts as demand for the company’s road salt rose during an unusually cold winter.
Quarterly sales fell 11 percent to 1.08 billion euros, above the 941 million euros forecast by analysts.
“Our salt activities were able to step into the breach for the fertiliser business,” Chief Executive Norbert Steiner said in a statement.
The mine operator reiterated it expected a notable year-on-year decline in operating earnings and sales in 2009 as farmers continue to hold of on fertiliser orders.
A recovery should, however, be seen in the second half, it added.
Prices of agricultural commodities followed the boom and bust of financial markets over the last two years, as investors rushed in and later abandoned the asset class, also buffeting fertiliser prices.
K+S early in April agreed to buy Morton Salt from Dow Chemical DOW.N for $1.675 billion including assumed debt, making the German mine operator the world’s largest salt supplier.
K+S shares change hands for 10.1 times estimated earnings for the coming 12 months, according to StarMine, which weights estimates according to analysts’ track record.
Potash Corp of Saskatchewan POT.TO the world’s No.1 potash producer, trades at a multiple of about 10.7. Mosaic (MOS.N), another rival, has a multiple of about 6.5. (Reporting by Ludwig Burger)