Terra Nitrogen Company, L.P. (TNCLP) (NYSE: TNH) today reported
net earnings of $42.2 million on net sales of
$119.0 million for the quarter ended March 31, 2017. This
compares to net earnings of $37.7 million on net sales of
$108.0 million for the 2016 first quarter. Net earnings
allocable to common units was $38.8 million ($2.10 per common
unit) and $26.7 million ($1.44 per common unit) for the 2017
and 2016 first quarters, respectively. Results for the first
quarter of 2017 included an unrealized net mark-to-market loss on
natural gas derivatives of $7.9 million compared to a loss of
$2.3 million in the first quarter of 2016. The derivative
portfolio at March 31, 2017 includes natural gas derivatives
that hedge a portion of natural gas purchases through 2018.
Analysis of Results
Net sales for the first quarter of 2017 totaled
$119.0 million, compared to $108.0 million for the first
quarter of 2016, as significantly higher sales volumes of ammonia
and urea ammonium nitrate (UAN) were partially offset by lower
average selling prices for both products.
Sales volumes for ammonia and UAN increased 40 percent and 47
percent, respectively, due to increased supply availability of both
products. Production was higher as the entire complex ran well in
the first quarter of 2017 compared to the first quarter of 2016
when one of the ammonia plants experienced an unplanned outage that
resulted in lower volumes of ammonia and UAN available for sale.
Additionally, the first quarter of 2017 saw favorable weather drive
strong early season ammonia and UAN demand in the Southern Plains
and lower Midwest.
Ammonia and UAN average selling prices declined in the first
quarter of 2017 compared to the first quarter of 2016 due to
greater global nitrogen supply availability.
Comparing the first quarter of 2017 to the first quarter of
2016, TNCLP’s:
- Ammonia sales volume increased by 40
percent and UAN sales volume increased by 47 percent;
- Ammonia average selling prices
decreased by 23 percent and UAN average selling prices decreased by
24 percent; and
- Realized natural gas cost per MMBtu
increased by 5 percent.
Cash Distribution
Cash distributions depend on TNCLP’s earnings as well as cash
requirements for working capital needs and capital and other
expenditures. For the first three months of 2017, capital
expenditures were $11.3 million as compared to
$13.8 million in 2016. The decrease was primarily due to costs
incurred in the first quarter of 2016 related to an unplanned
outage of one of the facility's ammonia plants that did not recur
in the first quarter of 2017.
For the full year 2017, TNCLP expects to make capital
expenditures in the range of $25 million to $35 million. TNCLP
previously announced that it expected to make capital expenditures
for the full year 2017 in the range of $75 million to $85 million,
with approximately $40 million of the projected capital
expenditures related to a plant turnaround scheduled to start in
the third quarter of 2017. Subsequent to that announcement, TNCLP
postponed the turnaround due to a delay in receiving certain
equipment. TNCLP anticipates the plant turnaround will occur in
2018 and expects it to cost approximately $40 million. The
calculation of Available Cash included a reserve of approximately
one-half of that amount.
TNCLP reported on May 3, 2017, the declaration of a cash
distribution for the quarter ended March 31, 2017, of $0.97
per common unit payable May 31, 2017 to holders of record as
of May 15, 2017. This compares to a cash distribution of $1.51
per common unit for the quarter ended March 31, 2016.
Cash distributions per common unit also vary based on increasing
amounts allocable to the General Partner when cumulative
distributions exceed targeted levels. With this distribution, TNCLP
cumulative distributions continue to exceed targeted levels.
This release serves as a qualified notice to nominees and
brokers as provided for under Treasury Regulation Section
1.1446-4(b). Please note that 100 percent of TNCLP’s distributions
to foreign investors are attributable to income that is effectively
connected with a United States trade or business. Accordingly,
TNCLP’s distributions to foreign investors are subject to federal
income tax withholding at the highest effective tax rate.
About TNCLP
Terra Nitrogen Company, L.P. is a leading manufacturer of
nitrogen fertilizer products.
Terra Nitrogen, Limited Partnership (TNLP), owner of the
Verdigris, Oklahoma manufacturing facility and related assets, is a
subsidiary of TNCLP. Terra Nitrogen GP Inc., an indirect, wholly
owned subsidiary of CF Industries Holdings, Inc., is the General
Partner of TNCLP and TNLP and exercises full control over all of
TNCLP’s and TNLP's business affairs.
Forward-Looking Statements
All statements in this communication, other than those relating
to historical facts, are forward-looking statements. These
forward-looking statements are not guarantees of future performance
and are subject to a number of assumptions, risks and
uncertainties, many of which are beyond TNCLP’s control, which
could cause actual results to differ materially from such
statements. Important factors that could cause actual results to
differ materially from expectations include, among others:
- Risks related to TNCLP's reliance on
one production facility;
- The cyclical nature of TNCLP's business
and the agricultural sector;
- The global commodity nature of TNCLP's
fertilizer products, the impact of global supply and demand on
TNCLP's selling prices, and the intense global competition from
other fertilizer producers;
- Conditions in the U.S. agricultural
industry;
- The volatility of natural gas prices in
North America;
- Difficulties in securing the supply and
delivery of raw materials, increases in their costs or delays or
interruptions in their delivery;
- Reliance on third party providers of
transportation services and equipment;
- The significant risks and hazards
involved in producing and handling TNCLP's products against which
it may not be fully insured;
- Risks associated with cyber
security;
- Weather conditions;
- Potential liabilities and expenditures
related to environmental, health and safety laws and regulations
and permitting requirements;
- Future regulatory restrictions and
requirements related to greenhouse gas emissions;
- The seasonality of the fertilizer
business;
- Risks involving derivatives and the
effectiveness of TNCLP's risk measurement and hedging
activities;
- Limited access to capital;
- Acts of terrorism and regulations to
combat terrorism;
- Risks related to TNCLP's dependence on
and relationships with CF Industries;
- Deterioration of global market and
economic conditions;
- Risks related to TNCLP's partnership
structure and control of TNCLP's General Partner by CF
Industries;
- Changes in TNCLP's available cash for
distribution to its unitholders, due to, among other things,
changes in its earnings, the amount of cash generated by its
operations and the amount of cash reserves established by its
General Partner for operating, capital and other requirements;
- The conflicts of interest that may be
faced by the executive officers of TNCLP's General Partner, who
operate both TNCLP and CF Industries; and
- Tax risks to TNCLP's common unitholders
and changes in TNCLP's treatment as a partnership for U.S. or state
income tax purposes.
More detailed information about factors that may affect TNCLP’s
performance may be found in its filings with the Securities and
Exchange Commission, including its most recent periodic reports
filed on Form 10-K and Form 10-Q, which are available through CF
Industries’ website. Forward-looking statements are given only as
of the date of this release and TNCLP disclaims any obligation to
update or revise the forward-looking statements, whether as a
result of new information, future events or otherwise, except as
required by law.
Terra Nitrogen Company, L.P. news announcements are also
available on CF Industries’ website, www.cfindustries.com.
TERRA NITROGEN COMPANY, L.P. CONSOLIDATED BALANCE
SHEETS (unaudited)
March 31, December 31, 2017 2016
(in millions, except for units) ASSETS Current
assets: Cash and cash equivalents $ 41.2 $ 39.5 Due from affiliates
of the General Partner 21.7 4.0 Accounts receivable 0.4 0.6
Inventories 5.0 8.6 Other current assets 1.9 7.9 Total
current assets 70.2 60.6 Property, plant and equipment—net 298.4
301.3 Other assets 9.8 11.4 Total assets $ 378.4 $
373.3
LIABILITIES AND PARTNERS' CAPITAL Current liabilities:
Accounts payable and accrued expenses $ 19.0 $ 27.8 Due to
affiliates of the General Partner 3.4 4.1 Other current liabilities
0.5 — Total current liabilities 22.9 31.9 Other
liabilities 3.1 2.6 Partners' capital: Limited partners' interests,
18,501,576 common units authorized, issued and outstanding 302.9
286.7 Limited partners' interests, 184,072 Class B common units
authorized, issued and outstanding 1.9 1.8 General partner's
interest 47.6 50.3 Total partners' capital 352.4
338.8 Total liabilities and partners' capital $ 378.4 $
373.3
TERRA NITROGEN COMPANY, L.P. CONSOLIDATED
STATEMENTS OF OPERATIONS (unaudited)
Three months ended March 31, 2017
2016 (in millions, except per unit
amounts) Net sales: Product sales to affiliates of the General
Partner $ 118.9 $ 107.9 Other income from an affiliate of the
General Partner 0.1 0.1 Total 119.0 108.0 Cost of goods
sold: Materials, supplies and services 65.4 57.7 Services provided
by affiliates of the General Partner 7.0 7.2 Gross margin
46.6 43.1 Selling, general and administrative services provided by
affiliates of the General Partner 3.9 3.9 Other general and
administrative expenses 0.5 1.5 Net earnings $ 42.2 $
37.7 Allocation of net earnings: General Partner $ 3.0 $ 10.6 Class
B common units 0.4 0.4 Common units 38.8 26.7 Net earnings $
42.2 $ 37.7 Net earnings per common unit $ 2.10 $
1.44
TERRA NITROGEN COMPANY, L.P. SUMMARIZED
OPERATING INFORMATION (unaudited)
Three months ended March 31, 2017
2016 Sales volume (tons in thousands) Ammonia 127 91
UAN(1) 532 362 Average selling prices (dollars per ton)
Ammonia $ 286 $ 373 UAN(1) $ 154 $ 203 Cost of natural gas
(dollars per MMBtu): Purchased natural gas costs(2) $ 3.06 $ 1.99
Realized derivatives (gain) loss(3) (0.03 ) 0.89 Cost of natural
gas $ 3.03 $ 2.88
_________________________________________________
(1) The nitrogen content of UAN is 32% by weight. (2)
Represents the cost of natural gas purchased during the period for
use in production. (3) Represents realized gains and losses on
natural gas derivatives settled during the period. Excludes
unrealized mark-to-market gains and losses on natural gas
derivatives.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170503006634/en/
Terra Nitrogen Company, L.P.Martin JarosickVice President,
Investor Relations847-405-2045mjarosick@cfindustries.com
Terra Nitrogen Company . (NYSE:TNH)
Gráfico Histórico do Ativo
De Mai 2024 até Jun 2024
Terra Nitrogen Company . (NYSE:TNH)
Gráfico Histórico do Ativo
De Jun 2023 até Jun 2024