Methanex Reports Higher Fourth Quarter 2020 Results

Except where otherwise noted, all currency amounts are stated in United States dollars.Average realized methanol price increased to $282 per tonne in the fourth quarter from $217 per tonne in the third quarter of 2020Continued improvement in global methanol demand, methanol industry supply outages and delayed start-up of new industry capacity additions supported higher methanol pricesNet loss attributable to Methanex shareholders of $27 million on Adjusted EBITDA of $136 million, reflecting a $96 million increase over the third quarter, demonstrating significant leverage to methanol priceResilient business model and continued ability to deliver reliable methanol supply to customers around the world demonstrated throughout 2020Strong liquidity position – over $800 million in cash and a $300 million undrawn credit facility providing financial flexibility as the path to sustained global economic recovery remains uncertain
VANCOUVER, British Columbia, Jan. 27, 2021 (GLOBE NEWSWIRE) — For the fourth quarter of 2020, Methanex (TSX:MX) (NASDAQ:MEOH) reported a net loss attributable to Methanex shareholders of $27 million ($0.35 net loss per common share on a diluted basis) compared to a net loss of $88 million ($1.15 net loss per common share on a diluted basis) in the third quarter of 2020. Adjusted EBITDA for the fourth quarter of 2020 was $136 million and Adjusted net income was $12 million ($0.15 Adjusted net income per common share). This compares with Adjusted EBITDA of $40 million and an Adjusted net loss of $79 million ($1.03 Adjusted net loss per common share) for the third quarter of 2020.For the year ended December 31, 2020, Methanex reported a net loss attributable to Methanex shareholders of $157 million ($2.06 net loss per common shares on a diluted basis), Adjusted EBITDA of $346 million and an Adjusted net loss of $123 million ($1.62 Adjusted net loss per common share). This compares with net income attributable to Methanex shareholders of $88 million ($1.01 net income per common share on a diluted basis), Adjusted EBITDA of $566 million and Adjusted net income of $71 million ($0.93 Adjusted net income per common share) for the year ended December 31, 2019.In the fourth quarter of 2020, continued improvement in global methanol demand, combined with various methanol industry supply outages and the delayed start-up of new industry capacity additions, led to tighter market conditions and lower global inventory levels. As a result, methanol prices increased by 30% in the fourth quarter, compared to the third quarter of 2020, resulting in higher Adjusted EBITDA.For the full year of 2020, the impact from the COVID-19 pandemic on the global economy and lower oil price environment resulted in a sharp decline in methanol demand and lower methanol prices in the second and third quarters, with some recovery in the fourth quarter, impacting our financial results in 2020 compared to 2019.John Floren, President and CEO of Methanex, commented, “I am extremely proud of the work that our team has done to deliver reliable methanol supply throughout the COVID-19 pandemic. Their performance underscores the tremendous agility and resilience of our people and business model and gives us confidence in our ability to continue to meet the demands of a very challenging situation. We are encouraged by the early signs of economic recovery that we saw starting in the second half of 2020, and continue to regularly monitor and review the methanol demand outlook and changes in the industry.”We took various steps in 2020 to preserve liquidity and financial flexibility in the challenging economic environment. We ended the year with $834 million in cash, a $300 million undrawn revolving credit facility and no debt maturities until the end of 2024.Our Geismar 3 project is a high-quality project with substantial capital and operating cost advantages. The project remains on temporary care and maintenance, with spending on the project over the next nine months expected to be approximately $80 million. This amount reflects costs that were already committed and the completion of activities that preserve flexibility to complete the project in the future including key engineering activities and procurement of critical path equipment. We have a robust decision making process for evaluating the project and before deciding whether to restart construction, management and our Board will need to carefully consider many factors including the global economic recovery and methanol industry outlook.John Floren concluded, “We are pleased to see continued improvement in methanol demand and prices although the uncertain economic recovery path makes the near-term difficult to forecast. We continue to believe that long-term methanol industry fundamentals are strong and methanol demand will continue to improve as the global economy fully recovers. For now, we continue to prioritize liquidity and financial flexibility. We remain well-positioned to generate significant long-term value as market conditions improve.”FURTHER INFORMATION
The information set forth in this news release summarizes Methanex’s key financial and operational data for the fourth quarter of 2020. It is not a complete source of information for readers and is not in any way a substitute for reading the fourth quarter 2020 Management’s Discussion and Analysis (“MD&A”) dated January 27, 2021 and the unaudited condensed consolidated interim financial statements for the period ended December 31, 2020, both of which are available from the Investor Relations section of our website at www.methanex.com. The MD&A and the unaudited condensed consolidated interim financial statements for the period ended December 31, 2020 are also available on the Canadian Securities Administrators’ SEDAR website at www.sedar.com and on the United States Securities and Exchange Commission’s EDGAR website at www.sec.gov.

FINANCIAL AND OPERATIONAL DATA
1  Methanex-produced methanol represents our equity share of volume produced at our facilities and excludes volume marketed on a commission basis related to the 36.9% of the Atlas facility and 50% of the Egypt facility that we do not own.2  Methanex average non-discounted posted price represents the average of our non-discounted posted prices in North America, Europe and Asia Pacific weighted by sales volume. Current and historical pricing information is available at www.methanex.com.3  Average realized price is calculated as revenue, excluding commissions earned and the Egypt non-controlling interest share of revenue, but including an amount representing our share of Atlas revenue, divided by the total sales volume of Methanex-produced and purchased methanol.4  Revenue for the three months and year ended December 31, 2019 have been restated as compared to revenue reported in our quarterly MD&A and condensed quarterly financial statements issued for 2019 based on a restatement for the recognition of revenue on Atlas-produced methanol.
Resource News, Oil and Gas News, Mining News, Renewable News

Resource News

Oil, Gas, Mining & Metals

Start typing and press Enter to search

shares