Trouble for the fertilizer group K + S (SDF) stock holders : The Federal Financial Supervisory Authority (Bafin) suspects that a billions in depreciation due to the drop in fertilizer prices may have been too low. The management of K + S is assuming that it will be able to invalidate the Bafin’s indications and has provided the relevant documents to the German Audit Office for Accounting (DPR). The shareholders reacted in shock, however, the share price collapsed in double digits. They fear further write-downs and possibly even a capital increase.
The case concerns depreciation of two billion euros in the “Europe +” operating unit, which the company announced on November 4, 2020. The background was lower assumptions about the long-term development of the potash price and higher assumptions about the cost of capital.