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Rentech Nitrogen Partners, L.P. Announces Results For Third Quarter 2013

Stocks in this article: RNF

For the Pasadena Facility, the Partnership’s current view for the balance of 2013 is based on lower forecasts of ammonium sulfate deliveries and prices compared to the August 8 guidance, with prices only slightly higher than the most recent business conducted. Based on these prices, EBITDA for the Pasadena Facility is expected to improve from the third quarter, which was affected by inventory write-downs, but to remain negative for the fourth quarter and the full year.

As a result of these factors, Rentech Nitrogen revised guidance on October 28, stating that the cash distribution for the fourth quarter of 2013 could be as low as zero.

The Partnership provided guidance for the following additional key operating metrics, and progress against its 2013 guidance updated on October 28:

       
Locked-in or Delivered

East Dubuque Facility

 

Deliveries 1

Ammonia

 

Tons

106,000 or 90%

Average price

$649

UAN

 

Tons

289,000 or 99%

Average price

$293

 

Natural gas in cost of sales 2

 

(million MMBtus)

10.7 or 100%

Average cost per million MMBtus

 

(including transportation costs)

$4.10

 

Pasadena Facility

 

Deliveries 1

Ammonium sulfate

 

Tons

401,000 or 83%

Average price

$254

 

Sulfuric acid 2

 

Tons

119,000 or 70%

Average price

$94

 

Ammonium thiosulfate 2

 

Tons

42,000 or 70%

Average price

$189

 

1Through October 31, 2013.

2Through September 30, 2013.

The Partnership provided the following guidance for production, deliveries, and raw materials consumption in 2013 and 2014 by product:

       

Production (in thousand tons)

2013E

2014E

East Dubuque Facility

Ammonia

273

365
UAN

287

315
Urea (liquid and granular)

176

190
Nitric Acid

116

120
Ammonium nitrate

129

135
CO 2

82

75
 

Pasadena Facility

Ammonium sulfate

492

670
Sulfuric acid

500

560
Ammonium thiosulfate

56

55
 
       

Deliveries (in thousand tons)

2013E

2014E

East Dubuque Facility

Ammonia

118

190
UAN

291

315
Urea (liquid and granular)

50

55
Nitric Acid

15

15
CO 2

83

75
 

Pasadena Facility

Ammonium sulfate

482

670
Sulfuric acid

171

95
Ammonium thiosulfate

60

55
 

Consumption

2013E

2014E

Ammonia (in thousand tons)

132

180
Natural gas (in million MMBtus)

10.7

12.5
Sulfur (in thousand tons)

179

210
Sulfuric acid (in thousand tons)

365

500
 

The Pasadena Facility’s margins are expected to improve and EBITDA is anticipated to be positive in 2014. The benefits of lower input costs, already visible in the market, should begin to be realized in early 2014. Additionally, third-party forecasters show modest improvements in prices for ammonium sulfate in 2014 relative to current pricing levels, and the variable margin expected to be earned on incremental volumes should contribute to increased profitability.

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