Adjusted EBITDA in the third quarter of 2014, at the world’s largest producer of Methanol and Canada-based Methanex slipped 14.37% from second quarter of 2014.
Methanex said adjusted EBITDA fell 14.37% sequentially quarter on quarter to $137 million for the third quarter of 2014 due to a decrease in its average realized price dropping to $389 per ton from $450 per ton in second quarter of 2014.
Adjusted net income was $66 million or $0.69 per share on a diluted basis in the third quarter of 2014, compared to adjusted net income of $91 million or $0.94 per share on a diluted basis for the second quarter of 2014.
Methanol production for the reporting quarter dropped just a shade under 1% to touch 1,204,000 tons compared with 1,216,000 tons for the second quarter of 2014.
During the third quarter of 2014, Methanex continued to repurchase common shares approved by its board in the second quarter. Till the end of the quarter, it repurchased 2,701,399 or 56% of the shares approved by the board for repurchasing.
According to Methanex, it continued to make excellent progress on its Geismar relocation projects. It is targeting to complete construction in late 2014 and produce methanol from Geismar 1 in January 2015 and from Geismar 2 in the first quarter of 2016.
It said the estimated remaining capital expenditures based on a revised budget related to the Geismar projects is approximately $500 million and during the third quarter of 2014, paid a $0.25 per share dividend totalling to $23 million.
Cash flows from operating activities in the third quarter of 2014 declined by $69 million to $171 million, compared with $240 million for the second quarter of 2014 and was down by $10 million compared to $181 million for the third quarter of 2013.
John Floren, CEO at Methanex said, "Methanol market fundamentals remain strong and methanol pricing has been resilient in the wake of the recent drop in oil prices and demand remained robust in the third quarter.”
John Floren added, "We are making excellent progress on the relocation of two of our Chile plants to Geismar, Louisiana. Each of these plants will add an incremental one million tonnes to our operating capacity.
"With over $475 million of cash on hand, an undrawn credit facility, robust balance sheet, and strong cash flow generation, we are well positioned to meet our financial commitments and invest to grow the Company.”
On its short term outlook, Methanex said, methanol prices moderated through the second quarter and stabilized in the third quarter and entering the fourth quarter, posted methanol prices have remained stable or increased across the major markets.
It added that methanol prices will ultimately depend on the strength of the global economy, industry operating rates, global energy prices, new supply additionsand the strength of global demand. (AR)
