CVR Partners(US:UAN)2020-02-20 19:36Financial Data and Key Metrics Changes - For the full year 2019, the company reported net sales of $404 million, a net loss of $35 million, and EBITDA of $107 million, compared to a net loss of $50 million and EBITDA of $84 million for 2018, indicating a 27% increase in EBITDA year-over-year [7][14] - In Q4 2019, net sales were $86 million with a net loss of $25 million and EBITDA of $11 million, down from net sales of $98 million and EBITDA of $33 million in Q4 2018 [7][15] - Direct operating expenses for Q4 2019 increased to $46 million from $38 million in the prior year, primarily due to turnaround expenses and higher personnel costs [16] Business Line Data and Key Metrics Changes - Combined operations produced approximately 180,000 gross tons of ammonia, 286,000 tons of UAN, and 55,000 tons of ammonia available for sale in Q4 2019, compared to 209,000 gross tons of ammonia and 357,000 tons of UAN in Q4 2018 [10] - UAN sales volumes decreased by 20% in Q4 2019, with an average netback price of $176 per ton, a 2% decrease from Q4 2018 [11][15] Market Data and Key Metrics Changes - The extreme wet conditions in spring 2019 led to a late planting season and delayed grain harvest, negatively impacting nitrogen application and pricing in Q4 2019 [12][23] - The UAN market experienced changes in trade flows due to EU tariffs on imports from certain countries, affecting pricing and availability [24] Company Strategy and Development Direction - The company is focused on improving plant reliability and debottlenecking to increase production with low capital investment over the next five years [22] - A re-expansion project at the Coffeyville plant has been approved, expected to enhance reliability and UAN production [22] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2020, anticipating an increase in planted corn acreage and strong in-season purchases of nitrogen fertilizer [12][26] - The company expects to navigate near-term market volatility while benefiting from lower natural gas costs, which positively impact production costs [25] Other Important Information - As of December 31, the company had approximately $62 million in liquidity, with $37 million in cash and $50 million available under the ABL facility [18] - The company generated EBITDA of $11 million for Q4 2019 but had total cash needs of $15 million for debt service, resulting in no cash available for distribution [19] Q&A Session Summary Question: Market conditions and UAN values - The market saw a sharp fall in UAN values, with producers trying to clear inventory and manage sales for the first quarter [32][34] - The NOLA price for UAN is not a liquid market point and may not reflect inland pricing accurately [34] Question: Urea debottlenecking and capital expenditure - The company is not ready to disclose incremental production figures but expects capital expenditures to be within the normal range for 2020 [37]