OCIP 4Q Results Up; Higher Prices, Production Cited

OCI Partners LP, Nederland, Texas, reported fourth-quarter net income of $13 million on sales of $98 million, up from a year-ago loss of $17 million on sales of $66 million. EBITDA was $38 million, up from $16 million.

“Our ammonia and methanol production units operated efficiently during the quarter and both experienced three days of downtime, resulting in capacity utilization rates of 102 percent and 97 percent, respectively,” said President and CEO Ahmed El-Hoshy.

“Methanol prices increased compared to the same quarter last year and compared to the third quarter of 2017, benefiting from good demand from both the Methanol-to-Olefins (MTO) sector in China and global construction activity, as well as tight supply,” he added. “After reaching multi-year low levels in the third quarter of 2017, ammonia prices increased throughout the fourth quarter, driven by firming phosphate and urea end markets and several supply curtailments in key export hubs.

“Looking forward to the first quarter of 2018, we expect our business to benefit from a recent increase in methanol and ammonia prices,” he said. While noting that the Tampa price was down at $305/mt CFR in March, he said first-quarter 2018 prices were still higher than fourth-quarter 2017.

OCIP is also looking forward to closing a recently announced new Term Loan B Facility and Revolving Credit Facility (GM Feb. 23, p. 25) in the coming weeks, which will allow it to reduce debt service costs and increase maturities.

On the results of the fourth quarter, OCIP announced a cash distribution of $0.27 per common unit, or approximately $23.5 million in the aggregate.

The company reported full-year preliminary and unaudited results on Feb. 5 in anticipation of company meetings with debt investors (GM Feb. 9, p. 26). Full-year net income was $24 million on sales of $343 million, up from a 2016 loss of $51 million on sales of $258 million. EBITDA was $127 million, up from $59 million.