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Highlights
- Revenue for Q4 2024 increased by 5.8% year-over-year to $446.5 million.
- Full-year adjusted EBITDA reached $470.8 million, second highest in company history.
- Distributable cash after maintenance capital expenditures for Q4 surged 192.5%.
Chemtrade Logistics Income Fund (TSX:CHE.UN) ("Chemtrade" or the "Fund") has announced its results for the three- and twelve-month periods ended December 31, 2024. The company's financial performance reflects strong growth in certain areas despite facing challenges, including the sale of its P2S5 business in Q4 2023 and the impact of a biennial maintenance turnaround at the North Vancouver chlor-alkali facility in 2024.
Fourth Quarter 2024 Performance
Chemtrade's fourth-quarter revenue for 2024 totaled $446.5 million, marking an increase of 5.8% year-over-year, driven by strong performance across the Fund’s core operations. Excluding the impact of the sale of its P2S5 business, revenue grew by 7.3% from the previous year. The adjusted EBITDA for the quarter reached $108.6 million, an impressive 28.3% year-over-year increase, which is attributed to improved operating performance, particularly in the industrial chemicals sector.
Despite these gains, net earnings for the quarter amounted to $10.3 million, reflecting a decrease of $1.4 million compared to Q4 2023. This decline is mainly due to a one-time gain in the prior year associated with the P2S5 business sale, partially offset by the increase in adjusted EBITDA.
The cash flows from operating activities increased to $100.0 million, up 1.4% year-over-year. This increase was primarily driven by higher adjusted EBITDA, though partially offset by working capital changes. The Fund also reported strong distributable cash after maintenance capital expenditures for Q4, which stood at $39.5 million, reflecting a remarkable increase of 192.5% from the previous year.
Full Year 2024 Financial Results
For the full year 2024, Chemtrade recorded revenue of $1,787.0 million, a 3.2% decrease from 2023. However, excluding the impact of the P2S5 business sale and the maintenance turnaround at its North Vancouver facility, revenue remained relatively stable compared to the prior year. The decline was primarily attributable to the P2S5 business divestiture and the temporary effects of the plant maintenance.
The adjusted EBITDA for the year totaled $470.8 million, marking the second-highest annual adjusted EBITDA in the company's history. Excluding the negative impacts of the maintenance turnaround and work stoppage at Canadian railways, Chemtrade's performance remained strong, with adjusted EBITDA being similar to the record levels achieved in 2023.
Chemtrade's net earnings for the year were $126.9 million, a $122.4 million decrease from 2023. This decline was largely driven by higher net finance costs, unrealized foreign exchange losses, and a decrease in adjusted EBITDA. However, the loss was partially offset by lower depreciation and amortization expenses.
The cash flows from operating activities for 2024 were $347.8 million, reflecting a decrease of 13.4% from the prior year, largely due to the lower adjusted EBITDA and changes in working capital. Additionally, distributable cash after maintenance capital expenditures decreased by 24.7% to $213.1 million, driven by lower cash flows from operations and higher lease payments.
Capital Allocation and Return to Unitholders
In 2024, Chemtrade returned $131.1 million of capital to its unitholders through unit buybacks and monthly distributions. This represented 61.5% of the distributable cash after maintenance capital expenditures. The company’s commitment to returning capital demonstrates its ongoing focus on delivering value to unitholders, despite the challenges faced during the year.
