By: ICN Bureau
Last updated : April 30, 2021 7:47 am
Completed a planned turnaround at the Geismar 2 plant and expects to complete the Geismar 2 debottlenecking project by mid-2021.
For the first quarter of 2021, Methanex reported net income attributable to Methanex shareholders of $105 million ($1.19 net income per common share on a diluted basis) compared to a net loss of $27 million ($0.35 net loss per common share on a diluted basis) in the fourth quarter of 2020.
Adjusted EBITDA for the first quarter of 2021 was $242 million and Adjusted net income was $82 million ($1.07 Adjusted net income per common share). This compares with Adjusted EBITDA of $136 million and Adjusted net income of $12 million ($0.15 Adjusted net income per common share) for the fourth quarter of 2020.
Methanex increased our average realized price in the first quarter of 2021 by $81 per tonne, to $363 per tonne, compared to the fourth quarter of 2020. Steady methanol demand recovery and lower industry operating rates supported higher methanol prices. Strong methanol demand combined with low global inventory levels and ongoing industry supply challenges continue to drive tight market conditions into the second quarter of 2021.
Our production in the first quarter of 2021 was similar to the fourth quarter of 2020. Higher production at the Atlas and Medicine Hat facilities offset lower production at the New Zealand and Geismar facilities. The company completed a planned turnaround at our Geismar 2 plant in the quarter. The debottlenecking project at Geismar 1 plant (completed in 2020) and our Geismar 2 plant (to be completed by mid-2021) will increase the annual operating capacity at our Geismar facilities to 2.2 million tonnes, a 10% increase over our 2020 annual operating capacity.
Methanex's adjusted EBITDA of $242 million increased by $106 million over the fourth quarter of 2020. These results highlight our earnings leverage to higher methanol prices and demonstrate the value of our business model. We ended the quarter with $856 million in cash, a $300 million undrawn revolving credit facility and no debt maturities until the end of 2024.
Methanex expects to spend approximately $60 million on our Geismar 3 project, during the care and maintenance period, over the next six months. We have a robust decision-making process for evaluating the project. Before deciding whether to restart construction, management and our Board will carefully consider many factors including the global economic recovery, methanol industry outlook, the Company’s financial position and our ability to execute on the project.
John Floren, President and CEO of Methanex, commented, “We are pleased to see favorable industry conditions continue through the first quarter with positive momentum leading into the second quarter. We are cautiously optimistic that manufacturing activity will rebound and the economy will fully recover in the medium term as vaccine rollouts accelerate and as governments announce additional fiscal support measures. For now, we continue to prioritize liquidity and financial flexibility to best position ourselves to deliver long-term shareholder value.”