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Methanex (MEOH) Earnings and Revenues Miss Estimates in Q4

Methanex Corporation MEOH logged a profit (attributable to shareholders) of $201 million or $2.51 per share in fourth-quarter 2021 versus a loss of $27 million or 35 cents per share in the year-ago quarter.

Adjusted earnings per share (barring one-time items) in the reported quarter were $2.43, missing the Zacks Consensus Estimate of $2.56.

Revenues rose around 54.4% year over year to $1,252.7 million in the quarter. However, the top line missed the Zacks Consensus Estimate of $1,299 million.

Adjusted EBITDA in the reported quarter surged 150% year over year to $340 million.

Methanex Corporation Price, Consensus and EPS Surprise

 

Methanex Corporation price-consensus-eps-surprise-chart | Methanex Corporation Quote

 

Operational Highlights

Production in the quarter totaled 1,933,000 tons, up around 20.3% year over year. Total sales volume for the fourth quarter was 2,804,000 tons, lower than the prior-year quarter’s figure of 2,868,000 tons.

The average realized price for methanol was $445 per ton in the quarter, up roughly 57.8% from $282 per ton in the prior-year quarter. In the fourth quarter, the strong fundamentals of the methanol industry, high levels of production and strong execution enabled Methanex to deliver one of the strongest operational and financial performances in its history, the company noted.

Full Year Results

Adjusted earnings for full-year 2021 were $6.03 per share against a loss of $1.62 per share a year ago. Net sales increased 66.6% year over year to $4,415 million.

Financials

Cash and cash equivalents increased around 11.9% year-over-year to $932 million at the end of the fourth quarter. The long-term debt at the end of the fourth quarter was $2,146.4 million, down around 7.6% year over year.

Cash flow from operating activities was $283 million, up around 191.7% year over year. The company paid out dividends worth $9 million during the reported quarter.

Outlook

Methanex forecasts production for 2022 to be roughly 1.5 million tons in New Zealand. It expects adequate gas to operate both Chile plants through the southern hemisphere summer months to the end of April 2022. The company projects production in 2022 to be roughly 1 million tons in Chile. The construction of the Geismar 3 project is progressing according to plan and is on track to be completed on-time and budget by late 2023 or early 2024.

The company stated that its capital allocation priorities remain the same. It is well placed to maintain its business, execute attractive growth opportunities and continue the long track record of returning excess cash to shareholders through dividend payouts and share repurchases.

Price Performance

Shares of Methanex have increased 27% in the past year compared with a 6.8% rise of the industry.

Image Source: Zacks Investment Research

Zacks Rank & Key Picks

Methanex currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the basic materials space are Albemarle Corporation ALB, Nutrien Ltd. NTR and AdvanSix Inc. ASIX.

Albemarle, currently sporting a Zacks Rank #1 (Strong Buy), has an expected earnings growth rate of 51.3% for the current year. The Zacks Consensus Estimate for ALB's earnings for the current year has been revised 5.4% upward in the past 60 days. You can see the complete list of today’s Zacks #1 Rank stocks here.

Albemarle beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, with the average being 22.1%. ALB has rallied around 23.6% over a year.

Nutrien, sporting a Zacks Rank #1, has a projected earnings growth rate of 53.8% for the current year. The Zacks Consensus Estimate for NTR's current-year earnings has been revised 17.4% upward in the past 60 days.

Nutrien beat the Zacks Consensus Estimate for earnings in three of the last four quarters while missed once. It has a trailing four-quarter earnings surprise of roughly 73.5%, on average. NTR has rallied around 35.3% in a year.

AdvanSix has a projected earnings growth rate of 7.4% for the current year. The Zacks Consensus Estimate for ASIX’s earnings for the current year has been revised 5.3% upward in the past 60 days.

AdvanSix beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, with the average being 46.9%. ASIX has surged 90% over a year. ASIX sports a Zacks Rank #1.




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