Itafos Provides Update ON Itafos Arraias
ITAFOS PROVIDES UPDATE ON ITAFOS ARRAIAS
TORONTO, ON – March 17, 2020 – Itafos (TSX-V: IFOS) (the “ Company”) provided today an
update on Itafos Arraias and announced the completion of the Co mpany’s plan to idle Itafos
Arraias considering the continued downward pressure on global f ertilizer prices. In addition, the
Company announced that it completed third party reports on Itafos Arraias’ mine and beneficiation
plant and secured important long-term income tax incentives for Itafos Arraias.
“We have safely completed the idling of Itafos Arraias to manag e the current fertilizer downcycle
and preserve the value of the assets while we evaluate strategic alternatives for the business. We
have also further validated the long-term viability of the asse ts by completing independent third
party reviews of the mine and beneficiation plant that confirmed that restarting Itafos Arraias’ mine
and beneficiation plant is viable,” said Dr. Wynand van Dyk, VP Engineering, R&D and
Development at Itafos.
On November 21, 2019, the Company announced its decision to idl e Itafos Arraias as part of a
disciplined approach to capital allocation considering the continued downward pressure on global
fertilizer prices. The Company has followed best practices in i mplementing its plan to idle Itafos
Arraias to protect and preserve the value of the underlying ass ets. As of March 6, 2020, the
Company has completed the employee layoffs and contractor termi nations associated with the
idling plan. In addition, the Company has successfully monetized its remaining inventory and raw
materials to partially offset costs associated with the impleme ntation of the idling plan.
Notwithstanding the idling of Itafos Arraias, the Company will continue to employ personnel that
are necessary for the care and maintenance of the assets and will continue to maintain all licenses
and permits in good standing and compliance with existing regulations.
In parallel with its decision to idle Itafos Arraias, the Compa ny engaged the services of Golder
Associates Inc. and Jesa Technologies LLC to conduct third party reports on Itafos Arraias’ mine
and beneficiation plant, respectively. The third party reports, which were completed in January
2020, confirm that restarting Itafos Arraias’ mine and benefici ation plant is feasible and outline
the respective timing and capex requirements.
Itafos Arraias is domiciled in Brazil and is subject to a feder al tax rate of 34%, composed of a
federal corporate income tax of 25% and other taxes of 9%. The location of Itafos Arraias’ assets
makes it eligible to participate in a regional development prog ram administered by the
Superintendência do Desenvolvimento da Amazônia (“ SUDAM”). Created in 1966 to promote
development of the Amazon region in Brazil, SUDAM offers tax in centives that allow eligible
companies to reduce the federal tax rate of 34% to 15.25% by me ans of a 75% discount to the
federal corporate income tax of 25%. In February 2020, SUDAM ac cepted Itafos Arraias’
application, granting Itafos Arraias the tax incentives for a period of ten years with an opportunity
to extend thereafter.
About Itafos
The Company is a vertically integrated phosphate fertilizers and specialty products company with
an attractive portfolio of long-term strategic businesses and p rojects located in key fertilizer
markets worldwide.
The Company owns, operates and is developing the following businesses and projects:
Itafos Conda – a vertically integrated phosphate mine and fert ilizer business with
production and sales capacity of approximately 550kt per year o f monoammonium
phosphate (“MAP”), MAP with micronutrients (“ MAP+”), superphosphoric acid (“ SPA”),
merchant grade phosphoric acid (“ MGA”) and specialty products including ammonium
polyphosphate (“APP”) located in Idaho, US;
Itafos Arraias – a phosphate fertilizer business with producti on and sales capacity of
approximately 500kt per year of single superphosphate (“ SSP”), SSP with micronutrients
(“SSP+”), premium PK compounds and approximately 40kt per year of exc ess sulfuric
acid located in Tocantins, Brazil;
Itafos Farim – a high-grade phosphate mine project located in Farim, Guinea-Bissau;
Itafos Paris Hills – a high-grade phosphate mine project locat ed in Idaho, US;
Itafos Santana – a vertically integrated high-grade phosphate mine and fertilizer plant
project located in Pará, Brazil;
Itafos Mantaro – a large phosphate mine project located in Jun in, Peru; and
Itafos Araxá – a vertically integrated rare earth elements and niobium mine and extraction
plant project located in Minas Gerais, Brazil.
For more information, or to join the Company’s mailing list to receive notification of future news
releases, please visit the Company’s website, www.itafos.com.
Forward Looking Information
Certain information contained in this news release constitutes forward looking information. All
information other than information of historical fact is forward looking information. The use of any
of the words “intend”, “anticipate”, “plan”, “continue”, “estim ate”, “expect”, “may”, “will”, “project”,
“should”, “would”, “believe”, “predict” and “potential” and sim ilar expressions are intended to
identify forward looking information. This information involves known and unknown risks,
uncertainties and other factors that may cause actual results o r events to differ materially from
those anticipated in such forward looking information. No assur ance can be given that this
information will prove to be correct and such forward looking i nformation included in this news
release should not be unduly relied upon.
Forward looking information is subject to a number of risks and other factors that could cause
actual results and events to vary materially from that anticipa ted by such forward looking
information. Although the Company has attempted to identify imp ortant factors that could cause
actual results to differ materially from those contained in for ward-looking statements, there may
be other factors that cause results not to be as anticipated, e stimated or intended. Factors that
may cause actual results to differ materially from expected res ults described in forward-looking
statements include, but are not limited to, those risk factors set out in the Company’s Management
Discussion and Analysis and other disclosure documents availabl e under the Company’s profile
at www.sedar.com. Readers are cautioned that the foregoing list of risks, uncer tainties and
assumptions are not exhaustive. The forward-looking information included in this news release is
expressly qualified by this cautionary statement and is made as of the date of this news release.
The Company undertakes no obligation to publicly update or revi se any forward-looking
information except as required by applicable securities laws.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PR OVIDER
(AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXC HANGE)
ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS NEW S
RELEASE.
For further information, please contact:
Itafos Investor Relations
www.itafos.com