LSB Industries Inc. has released results for the first quarter ended 31 March 2017.
- Net sales from continuing operations of US$123.3 million for 1Q17, an increase of US$24.4 million from US$98.9 million for 1Q16.
- Net loss from continuing operations of US$6.0 million for 1Q17, an improvement of US$9.8 million from a loss of US$15.8 million for 1Q16.
- Adjusted EBITDA from continuing operations of US$20.0 million for 1Q17, an increase of US$11.7 million, from US$8.3 million for 1Q16.
“We have made positive improvements that are reflected in our first quarter 2017 results,” stated Daniel Greenwell, LSB’s President and CEO. “As anticipated, pricing for our agricultural products, although slightly improved from 4Q16, remained well below prior year levels. However, our performance improved compared to 1Q16 as a result of stronger operations at our three primary chemical manufacturing facilities, enhanced by the incremental output from the new ammonia plant at El Dorado, which entered service in May of 2016.
“Our Cherokee and Pryor ammonia plants operated at on-stream rates of approximately 99% and 96%, respectively, throughout the first quarter, and have continued their strong performance thus far in April. El Dorado’s ammonia on-stream rate continued to improve with the first quarter of 2017 increasing over the fourth quarter of 2016. On-stream rates for the first quarter of 2017 rose to approximately 90% and, for the month of March, achieved 100% while consistently producing at rates in excess of 1300 tpd, which is significantly higher than the plant’s nameplate capacity of 1,150 tons per day. We expect this to continue throughout 2017.”
Mr. Greenwell continued: “Demand for our agricultural products for spring applications has been strong, with the UAN production capacity at both our Pryor and Cherokee facilities sold out through the middle of May. Additionally, our previously outlined strategy to increase sales of high density ammonium nitrate (HDAN) has been successful. Sales of HDAN were up significantly in the first quarter versus the same period last year and we are currently working off a significant HDAN order book. We anticipate that HDAN sales will continue to grow and we plan to position product in our storage facilities later this year in anticipation of that increase in demand in 2018. Finally, demand for the nitric acid and ammonia for industrial markets is increasing and we expect this trend to continue.”
“We are encouraged about our prospects for continued year-over-year performance improvement for the balance of 2017. The refinancing actions we completed in the third quarter of 2016 enhanced our financial position, and will result in a meaningful reduction in full year interest expense versus last year. Anticipated sales of non-core assets in the first half of this year will further strengthen our balance sheet and provide us with greater financial flexibility.”
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