Orica plans to expand

Following last week’s profit announcement, explosives and chemicals supplier Orica has signalled that it will continue to expand.

AAP reports that Chief executive Ian Smith said that the company can expand without the need to build as many new plants as it has in the past.

He told the ABC’s Inside Business program that the company had invested a lot of capital into converting gas through ammonia to ammonium nitrate which is Orica’s main source of explosives.

He added that there was no need for Orica to build any more plants because the company is large enough to offer off-take agreements that are long-term and well priced.

Instead of investment in new plants, Orica will focus investment more on the service area. The company expects profits to increase next year as the North American coal markets improve and the company sells more sophisticated explosives.

Orica returned a net profit of $602 million for 2013. This represented a jump of nearly 49% over the previous year.

The net profit after tax and individually material items was up $199 million compared to the same time last year, when it earned $403 million.

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