Methanex Corporation (NASDAQ:MEOH) , through its fully-owned unit – Methanex Chile S.A. – has inked an agreement with Petrobras Argentina S.A. to settle a legal dispute related to Petrobras' natural gas delivery obligations, following a long-term natural gas supply pact between the two companies.
Petrobras will pay $32.5 million to Methanex in order to end both the natural gas supply agreement as well as all claims associated to the agreement.
Methanex recorded a loss of $23 million or 26 cents per share in the first quarter of 2016, against a profit of $9 million or 9 cents per share in the year-ago quarter. Loss per share was wider than the Zacks Consensus Estimate of a loss of 22 cents.
Methanex’s adjusted earnings before interest, tax, depreciation and amortization (EBITDA) were $36 million in the quarter, reflecting a decline of roughly 62.9% from $97 million recorded a year ago. The fall was attributable to lower average realized prices of methanol in the quarter.
Furthermore, revenues plunged around 24.6% year-over-year to $435 million in the reported quarter, missing the Zacks Consensus Estimate of $449 million.
Methanex is optimistic about methanol prices in the second quarter of 2016. The company has stabilized contract pricing and is seeing an uptrend in the Asian spot-market for the current quarter. With the increased production capacity, the company is well placed to take advantage of the rising methanol prices. The company is also focusing on the delivery of methanol-run ocean-going vessels in this quarter.
Methanex currently has a Zacks Rank #3 (Hold).
Some better-ranked companies in the chemical space include Albemarle Corp. (NYSE:ALB) , BASF SE (OTC:BASFY) and Akzo Nobel N.V. (OTC:AKZOY) , all of them sporting a Zacks Rank #1 (Strong Buy).
BASF SE (BASFY): Free Stock Analysis Report
METHANEX CORP (MEOH): Free Stock Analysis Report
ALBEMARLE CORP (ALB): Free Stock Analysis Report
AKZO NOBEL NV (AKZOY): Free Stock Analysis Report
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