TORONTO, Feb. 20, 2014 /CNW/ - Chemtrade Logistics Income Fund
(TSX: CHE.UN) today announced results for the three months and year
ended December 31, 2013. The financial statements and MD&A will be
available on Chemtrade's website at chemtradelogistics.com and on SEDAR at sedar.com.
For the year ended December 31, 2013, distributable cash after
maintenance capital expenditures was $75.5 million or $1.81 per unit.
The comparable numbers for 2012 were $86.4 million and $2.07 per unit.
The decline reflected higher maintenance capital expenditures relative
to 2012, increased LTIP accruals, and costs related to the acquisition
of General Chemical. Revenue for the year was $836.1 million (2012:
$919.4 million). EBITDA was $129.9 million compared with $141.5
million in 2012. Cash flow from operating activities was $107.8 million
(2012: $108.3 million). Net earnings for 2013 were $5.5 million, which
was lower than the $38.9 million reported in 2012, mainly due to
certain non-cash items recorded in 2013. These included higher net
finance costs in 2013 as a result of the fair value adjustments on the
convertible unsecured debentures, a large unrealized foreign exchange
loss in 2013 compared with a gain in 2012 and a write-down of property,
plant and equipment. These were partially offset by a higher income tax
recovery in 2013.
Chemtrade President and Chief Executive Officer, Mark Davis, said, "Each
of our operating segments performed well in 2013 and in the fourth
quarter. EBITDA generated by our operating businesses for the year was
$175.8 million, which was consistent with $178.8 million generated in
2012, and EBITDA generated by our businesses in the fourth quarter was
also similar to the results achieved in 2012."
For the fourth quarter of 2013, revenue was $201.6 million, which was
$21.4 million lower than the fourth quarter of 2012, mainly due to
lower revenue in the International segment. Aggregate cash flow from
operating activities was $29.9 million compared with $39.6 million
generated during the fourth quarter of 2012.
Distributable cash after maintenance capital expenditures for the fourth
quarter of 2013 was $3.4 million or $0.08 per unit. The comparable
numbers for the fourth quarter of 2012 were $13.8 million or $0.33 per
unit. The two main reasons for the $0.25 per unit difference in
distributable cash were an increase in LTIP costs of $6.9 million, or
$0.17 per unit, and costs of $2.9 million, or $0.07 per unit related to
merger and acquisition activities that were incurred in fourth quarter.
These costs were also reflected in aggregate EBITDA of $21.1 million
for the fourth quarter of 2013 compared with $34.7 million in 2012.
In the fourth quarter SPPC generated revenue of $144.3 million compared
with $147.0 million in 2012. The main reason for the decrease in
revenue was lower prices for sulphur. This was partially offset by
higher prices for certain of the segment's other products relative to
2012. EBITDA for the fourth quarter of 2013 was $35.5 million compared
with $36.3 million in 2012.
Pulp Chemicals reported fourth quarter revenue of $13.0 million compared
with $13.1 million in 2012. The segment generated EBITDA of $2.5
million compared with $3.1 million in 2012. The decline was due to
lower production levels of sodium chlorate as well as higher
maintenance costs relative to 2012.
International reported revenue of $44.2 million for the fourth quarter,
compared with $62.9 million in 2012, reflecting lower prices of sulphur
and lower volumes of sulphuric acid due to the generally weak business
conditions in international markets. Despite the lower revenue, EBITDA
of $3.7 million was virtually unchanged from the $3.8 million reported
Corporate costs during the fourth quarter of 2013 were $20.6 million,
which was $12.0 million higher than the fourth quarter of 2012. The
main reasons for the increase were the higher LTIP accruals and the
costs related to merger and acquisition activities.
Mr. Davis said, "It was a good year for Chemtrade, with our operating
businesses continuing to perform well. We were also able to effectively
deploy our capital plan and further improve the effectiveness of our
assets. The highlight of the year was the acquisition of General
Chemical and the related $345.0 million equity issue which were
announced in December and completed in January 2014. We are now
integrating the businesses and are excited about the prospects for the
enlarged operations. Each of our acquisitions is dependent on the
strength and performance of our businesses so we will continue
investing in our assets to optimize efficiency and reliability. We
expect demand for most of our products and services to remain stable in
2014 and believe the combination of our diversified customer base, our
long-term risk-sharing contracts and strong balance sheet is more than
sufficient to sustain our current distribution rate."
Distributions declared in the fourth quarter totalled $0.30 per unit,
comprised of monthly distributions of $0.10 per unit.
Chemtrade operates a diversified business providing industrial chemicals
and services to customers in North America and around the world.
Chemtrade is one of North America's largest suppliers of sulphuric
acid, inorganic coagulants for water treatment, liquid sulphur dioxide,
sodium nitrite and sodium hydrosulphite. Chemtrade is a leading
processor of spent acid as well as a leading regional supplier of
sulphur, sodium chlorate, phosphorus pentasulphide, and zinc oxide.
Additionally, Chemtrade provides industrial services such as processing
hydrogen sulphide and other by-products and waste streams.
Caution Regarding Forward-Looking Statements
Certain statements contained in this news release constitute
forward-looking statements within the meaning of certain securities
laws, including the Securities Act (Ontario). Forward-looking statements can be generally identified by
the use of words such as "anticipate", "continue", "estimate",
"expect", "expected", "intend", "may", "will", "project", "plan",
"should", "believe" and similar expressions. Specifically,
forward-looking statements in this news release include statements
respecting certain future expectations about: demand for products and
services; investment strategy; and the sustainability of the Fund's
distributions. Forward-looking statements in this news release describe
the expectations of the Fund and its subsidiaries as of the date
hereof. These statements involve known and unknown risks, uncertainties
and other factors that may cause actual results or events to differ
materially from those anticipated in such forward-looking statements
for a variety of reasons, including without limitation the risks and
uncertainties detailed under the "Risk Factors" section of the Fund's
latest Annual Information Form and the "Risks and Uncertainties"
section of the Fund's most recent Management's Discussion & Analysis.
Although the Fund believes the expectations reflected in these
forward-looking statements and the assumptions upon which they are
based are reasonable, no assurance can be given that actual results
will be consistent with such forward-looking statements, and they
should not be unduly relied upon. With respect to the forward-looking
statements contained in this news release, the Fund has made
assumptions regarding: there being no significant disruptions affecting
the operations of the Fund and its subsidiaries, whether due to labour
disruptions, supply disruptions, power disruptions, transportation
disruptions, damage to equipment or otherwise; the ability of the Fund
to obtain products, raw materials, equipment, transportation, services
and supplies in a timely manner to carry out its activities and at
prices consistent with current levels or in line with the Fund's
expectations; the timely receipt of required regulatory approvals; the
cost of regulatory and environmental compliance being consistent with
current levels or in line with the Fund's expectations; the ability of
the Fund to successfully access tax losses and tax attributes; the
ability of the Fund to obtain financing on acceptable terms; currency,
exchange and interest rates being consistent with current levels or in
line with the Fund's expectations; and global economic performance.
The Fund disclaims any intention or obligation to update any
forward-looking statement even if new information becomes available, as
a result of future events or for any other reason. The forward-looking
statements contained herein are expressly qualified in their entirety
by this cautionary statement.
Further information can be found in the disclosure documents filed by
Chemtrade Logistics Income Fund with the securities regulatory
authorities, available at www.sedar.com.
A conference call to review the fourth quarter and full year 2013
results will be webcast live on www.chemtradelogistics.com and www.newswire.ca/en/webcast on Friday, February 21, 2014 at 10:00 a.m. ET.
SOURCE Chemtrade Logistics Income Fund