15 February 2006

ZA Puławy SA Sustains Its Financial Forecast for the 2005/2006 Financial Year

The disruptions in gas supplies in the periods January 1st–January 3rd and January 22nd–February 7th did not affect the Company’s forecasts for 2005/2006. They contributed to lower output of fertilisers (granulated urea (7.8%), granulated ammonium nitrate (1.7%), and UAN (2.6%)). However, on a seven-month cumulative basis (July 2005–January 2006), the Company’s production volume of nitrogen fertilisers (as calculated on a pure-nitrogen basis) was 2.9% above the target. The Company’s performance is also stronger than in the previous financial year. Year on year, the output of ammonia went up by 25,9 thousand tonnes, granulated ammonium nitrate – by 11.6 thousand tonnes, granulated urea – by 36.0 thousand tonnes, and UAN – by over 38.0 thousand tonnes.

The effects of lower gas supplies, which directly translate into lower output of ammonia (necessary for production of fertilisers), were mitigated by processing ammonia water imported from Russia.

Based on its seven-month production performance and the data on reduced output in February, the Company sustains its financial forecast.

Sales revenue is planned to reach PLN 1909m, EBITDA – PLN 253m, and net profit – PLN 117m.

ZA Puławy operates on three key product markets:

• Fertilisers for the agricultural sector (urea, ammonium nitrate, urea-ammonium nitrate solution, ammonium sulphate) – leading Polish and global producer
• Melamine (used in the production of synthetic resin which is applied in the furniture, paint and varnish market, as well as textile and paper sectors) – third largest producer in the world, the only producer in Poland
• Caprolactam (used for the production of textile and industrial fibres, carpeting and engineering resins used in automotive, electronic and food industries) – one of the two producers in Poland.
  ZA Puławy is the largest company in the fertilisers and chemical sector in Poland and an important producer in the world. Approximately half of its revenue is derived from the exports.

For more information please contact:

Marek Sieprawski
ZA Puławy SA
tel. (+ 48 81) 887 62 01
msieprawski@azoty.pulawy.pl