OCI Doubles 4Q Adjusted EBITDA, Iowa Plant Reaches Record Production

OCI NV, Amsterdam, reported a 102 percent increase in adjusted EBITDA to $269 million on revenues of $941.5 million for the fourth-quarter ending Dec. 31, 2018, up from the year-ago $133.2 million and $642 million, respectively. However, it continued to report a net loss attributable to shareholders. The loss was $18.7 million, though improved from the year-ago $56.1 million. Company-wide sales volumes were up 24 percent, to 3 million mt from 2.45 million mt.

The company touted the performance of its Iowa Fertilizer Co. (IFCo) unit, which reached record production levels of 115 percent of nameplate capacity during the quarter. OCI said this played a significant role in the increased EBITDA. The company also revealed that in late 2018 it received a permit to further increase IFCo’s operating rates on a permanent basis. IFCo is expected to have higher production levels in 2019 than in 2018, approaching 120 percent of nameplate capacity.

CEO Nassef Sawiris highlighted the flexibility of having some 500,000 tons of onsite and offsite storage in the U.S. “Our significant onsite ammonia storage allowed us to comfortably keep tons that are not placed in the fall for our customers and achieve a step-up for our spring pricing,” he told analysts on Feb. 26. “On UAN, we have over 150,000 tons of offsite storage in place across the Cornbelt shared between ten facilities.” He added that the N-7 joint venture also bolsters storage and marketing capabilities for urea into the Dakotas and Minnesota.

On the international front, Sawiris said fertilizer and methanol prices have been negatively impacted by U.S. sanctions on Iran, as that country has sold at significant discounts into the market. However, the company said as those sanctions are now being fully implemented and export opportunities for Iran diminish, it expects Iran exports to likely decline in 2019.

As for OCI’s North African production, Sawiris said except for a couple of turnarounds expected in Algeria, most production metrics are very supportive of stronger volumes coming out of North Africa.

For the year, OCI’s total U.S. fertilizer operations (IFCo, OCI Fertilizer, and N-7) reported an operating profit of $39.3 million on revenues of $489.1 million, up from a 2017 loss of $53.5 million and $193.3 million, respectively. Adjusted EBITDA was $157.2 million, up from $4.6 million.

Company-wide, OCI reported full-year adjusted EBITDA of $937.5 million on revenues of $3.25 billion, up from 2017’s $634.3 million and $2.25 billion, respectively. OCI reported a net loss of $48.7 million, down from the year-ago loss of $103.6 million. OCI sales volumes were up 29 percent in 2018, to 11.15 million mt from 2017’s 8.7 million mt.

OCI Product Sales Volumes (000 mt)

 Industrial Chemicals

Traded Third Party – Fertilizer and Industrial Chemicals