Prolonged CN Rail Strike Could Have Material Negative Impact on Chemtrade’s Operating Results
TORONTO, November 20, 2019 — A prolonged interruption of rail service resulting from the work stoppage at Canadian National Railway Company (CN) that commenced on early Tuesday morning could have a material negative impact on the operating results of Chemtrade Logistics Income Fund (TSX: CHE.UN). Chemtrade’s earnings guidance for 2019, which was updated on November 6, 2019 did not contemplate an interruption to rail service. If the strike does have a material impact it is likely to prevent Chemtrade from meeting its earnings guidance.
Mark Davis, President and Chief Executive Officer of Chemtrade said, “It’s difficult to quantify the impact of an interruption of rail service as it will also affect our suppliers and customers in varying degrees. Our operations and those of our customers and suppliers are heavily dependent on rail service, and a number of our locations across Canada are served by CN. Where possible, we have plans in place to continue to deliver product to our customers. However, alternative supply arrangements are not just costly but are also generally not feasible. If the stoppage continues for more than a few days, the additional costs and lost sales revenue could have a material impact on our operating results.”
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 a leading regional supplier of sulphur, chlor-alkali products, liquid sulphur dioxide, potassium chloride, and zinc oxide. Additionally, Chemtrade provides industrial services such as processing by-products and waste streams.
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 impact of the CN work stoppage on the Fund’s operating results and ability to meet its earnings guidance. 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, including without limitation the risks and uncertainties detailed under the “RISK FACTORS” section of the Fund’s latest Annual Information Form and the “RISKS AND UNCERTAINTIES” section of the Fund’s most recent Management’s Discussion & Analysis.
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.
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 Chemtrade Logistics Income Fund with the securities regulatory authorities, available at www.sedar.com.
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For further information:
President & CEO
Tel: (416) 496-4176
Vice President, Finance & CFO
Tel: (416) 496-4177