K+S still faces the prospect of tapping shareholders for funds to prop up its balance sheet, despite failing to announce a cash call with results on Thursday as many investors had expected.

The level of the fertilizer group's debts following the $1.68bn purchase of Morton Salt means K+S is "still not out of the woods with respect to a potential rights issue", analysts at Icap in London said.

This sentiment was echoed by brokers including Italy's Unicredit, Germany's Bankhaus Lampe and Switzerland's Credit Suisse.

K+S said it was considering a capital increase among other options.

'Rather sooner than later'

Credit Suisse rated a capital increase as "very likely", given Thursday's third-quarter results showed net debt rising E200m to E833m, year on year - before the Morton Salt deal was paid for last month.

K+S looked set to end the year with net debt of E1.8bn, equivalent to more than four times earnings before interest, tax, depreciation and amortisation.

The German group has aimed for a debt-to-ebitda ratio, a key metric for assessing debt burdens, of at most 1.5 times.

Credit Suisse said: "K+S has made no announcement regarding capital restructuring this morning, However, we still expect K+S to raise fresh equity rather sooner than later."

Dividend hit 

K+S's finances have been weakened by the downturn in fertilizer markets besides its purchase of Morton Salt from America's Dow Chemical.

The group unveiled an underlying loss of E2.1bn for the July-to-September quarter, compared with earnings of E358.1m a year before, led by a slide in the fortunes of its potash and nitrogen divisions.

It restated a doubt over the size of its investor payout, saying the slide in earnings expected for the full year would have a "corresponding impact on the future dividend payment".

Both Moody's and Standard & Poor's, the ratings agencies, are considering a downgrade to K+S's credit ratings.