Chemtrade Logistics Income Fund Announces Organic Growth Targets Ahead of Upcoming Investor Day
TORONTO, Ontario, November 18, 2022 – Chemtrade Logistics Income Fund (TSX: CHE.UN) will be hosting an Investor Day this morning, November 18, 2022, beginning at 9:00 am ET and concluding by 12:00 pm ET. The event will be held in person at the Exchange Tower (ground floor) in downtown Toronto, ON (120 Adelaide St. W., Toronto, ON, M5X 1J2). A related investor presentation will be available prior to the event on Chemtrade’s website, www.chemtradelogistics.com/investors. Following the Investor Day, a replay of the event will also be made available on the website.
Investor Day Agenda
The Investor Day will include presentations from various members of Chemtrade’s Senior Leadership Team. Speakers and topics to be addressed include the following:
- Scott Rook, President and Chief Executive Officer – Business Overview and Strategy
- Alan Robinson, Group Vice President, Commercial and Timothy Montgomery, Group Vice President, Manufacturing and Engineering – Market Fundamentals and Growth Opportunities
- Timothy Montgomery, Group Vice President, Manufacturing and Engineering – Operational Excellence
- Emily Powers, Group Vice President, Human Resources and Responsible Care – Environmental, Social & Governance Strategy
- Rohit Bhardwaj, Chief Financial Officer – Financial Strategy
The event will also feature a presentation from Nick Kovics, Executive Director of Global Chlor-Alkali at OPIS (formerly IHS Markit), during which he will speak to global market dynamics for chlor-alkali chemicals.
Organic Growth Targets and Related Capital Investments
During today’s event, Chemtrade’s Senior Leadership Team will discuss a number of the Company’s organic growth projects. This includes Chemtrade’s Ultrapure sulphuric acid plant expansion and upgrade in Cairo, Ohio and its greenfield construction of an Ultrapure sulphuric acid plant in Casa Grande, Arizona through its joint venture, KPCT Advanced Chemicals LLC. It also includes organic growth projects that Chemtrade is undertaking in its water chemicals business as well as its projects to monetize green hydrogen production.
Through the construction and commercialization of its organic growth projects, Chemtrade is targeting to generate incremental annual Adjusted EBITDA(1) of $45 million by year-end 2025 and incremental annual Adjusted EBITDA of $75 million by year-end 2027. Chemtrade estimates that approximately $270 million of growth capital expenditures(2) will be incurred through 2027 to complete these projects and generate this incremental annual Adjusted EBITDA.
Chemtrade operates a diversified business providing industrial chemicals and services to customers in North America and around the world. Chemtrade is one of North America’s largest suppliers of sulphuric acid, spent acid processing services, inorganic coagulants for water treatment, sodium chlorate, sodium nitrite, sodium hydrosulphite and phosphorus pentasulphide. Chemtrade is also the largest producer of high purity sulphuric acid for the semiconductor industry in North America. Chemtrade is a leading regional supplier of sulphur, chlor-alkali products, liquid sulphur dioxide, and zinc oxide. Additionally, Chemtrade provides industrial services such as processing by-products and waste streams.
NON-IFRS AND OTHER FINANCIAL MEASURES
Non-IFRS financial measures and non-IFRS ratios
Non-IFRS financial measures are financial measures disclosed by an entity that (a) depict historical or expected future financial performance, financial position or cash flow of an entity, (b) with respect to their composition, exclude amounts that are included in, or include amounts that are excluded from, the composition of the most directly comparable financial measure disclosed in the primary financial statements of the entity, (c) are not disclosed in the financial statements of the entity and (d) are not a ratio, fraction, percentage or similar representation. Non-IFRS ratios are financial measures disclosed by an entity that are in the form of a ratio, fraction, percentage or similar representation that has a non-IFRS financial measure as one or more of its components, and that are not disclosed in the financial statements of the entity.
These non-IFRS financial measures and non-IFRS ratios are not standardized financial measures under IFRS and, therefore, are unlikely to be comparable to similar financial measures presented by other entities. Management believes these non-IFRS financial measures and non-IFRS ratios provide transparent and useful supplemental information to help investors evaluate our financial performance, financial condition and liquidity using the same measures as management. These non-IFRS financial measures and non-IFRS ratios should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with IFRS.
The following section outlines our non-IFRS financial measures and non-IFRS ratios, their compositions, and why management uses each measure. It includes reconciliations to the most directly comparable IFRS measures. Except as otherwise described herein, our non-IFRS financial measures and non-IFRS ratios are calculated on a consistent basis from period to period and are adjusted for specific items in each period, as applicable.
Growth capital expenditures
Most directly comparable IFRS financial measure: Capital expenditures
Definition: Growth capital expenditures is calculated as Capital expenditures less Maintenance capital expenditures, plus Investments in a joint venture.
Why we use the measure and why is it useful to investors: It provides useful information related to the capital spending and investments intended to grow earnings.
Caution Regarding Forward-Looking Statements
Certain statements contained in this news release constitute forward-looking statements within the meaning of certain securities laws, including the Securities Act (Ontario). Forward-looking statements can be generally identified by the use of words such as “anticipate”, “continue”, “estimate”, “expect”, “expected”, “intend”, “may”, “will”, “project”, “plan”, “should”, “believe” and similar expressions. Specifically, forward-looking statements in this news release include statements respecting certain future expectations about:the Fund’s ability to deliver on organic growth opportunities; the Fund’s expected returns from its organic growth projects; and the expected growth capital expenditures that will be incurred for its organic growth projects through year-end 2027. Forward-looking statements in this news release describe the expectations of the Fund and its subsidiaries as of the date hereof.
These statements are based on assumptions and involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements for a variety of reasons. Although the Fund believes the expectations reflected in these forward-looking statements and the assumptions upon which they are based are reasonable, no assurance can be given that actual results will be consistent with such forward-looking statements, and they should not be unduly relied upon.
Actual events and results can be substantially different from what is expected or implied by the forward-looking information as a result of risks, uncertainties and other factors, including without limitation, the factors detailed under the “Risk Factors” section of the Fund’s latest Annual Information Form and the “Risks and Uncertainties” sections of the Fund’s most recent Management’s Discussion and Analysis.
All forward-looking information in this release speaks as of the date of this press release. Except as required by law, the Fund does not undertake to update or revise any forward-looking statements, whether as a result of new information, future events or for any other reason. The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement.
Further information can be found in the disclosure documents filed by the Fund with the securities regulatory authorities, available at www.sedar.com.
(1) Adjusted EBITDA is a Total of Segments measure. Certain additional disclosures for this specified financial measure have been incorporated by reference and can be found on Page 39 in the MD&A for the third quarter of 2022, available on SEDAR at www.sedar.com and on Chemtrade’s website under the Investors section.
(2) Growth capital expenditures is a non-IFRS measure. Please see Non-IFRS and Other Financial Measures for more information.
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For further information:
Chief Financial Officer
Tel: (416) 496-4177
Business Development Manager
Tel: (973) 515-1831