Chemtrade Logistics Income Fund's Q2 revenue up 10.8%, beats estimates

Overview

• Chemtrade Q2 revenue up 10.8% yr/yr, beating analyst expectations, per LSEG data

• Adjusted EBITDA for Q2 rises 19.9%, surpassing analyst estimates, per LSEG data

• Co raises 2025 adjusted EBITDA guidance, announces Polytec acquisition

Outlook

• Chemtrade raises 2025 Adjusted EBITDA guidance to C$475 mln-C$500 mln

• Chemtrade Vision 2030 aims for C$550 mln-C$600 mln Adjusted EBITDA by 2030

Result Drivers

• HIGHER SELLING PRICES - Revenue growth driven by increased selling prices for merchant acid, water solutions products, Regen acid, and caustic soda, offsetting lower sodium chlorate volumes and chlorine prices

• FOREIGN EXCHANGE IMPACT - Weaker Canadian dollar relative to the U.S. dollar positively impacted revenue and Adjusted EBITDA by C$5.8 mln and C$2.6 mln, respectively

• MAINTENANCE TURNAROUND - Prior year's maintenance at North Vancouver plant negatively impacted Q2 2024 results, with a C$10.5 mln reduction in revenue and C$17.9 mln decrease in Adjusted EBITDA

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 5 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the commodity chemicals peer group is "buy"

• Wall Street's median 12-month price target for Chemtrade Logistics Income Fund is C$15.00, about 25.3% above its August 13 closing price of C$11.20

• The stock recently traded at 9 times the next 12-month earnings vs. a P/E of 8 three months ago

Press Release: ID:nBw72gMhHa