VANCOUVER, BRITISH COLUMBIA--(Marketwired - Jul 30, 2014) - For the second quarter of 2014, Methanex (MX.TO)(MEOH) reported Adjusted EBITDA¹ of $160 million, compared to Adjusted EBITDA¹ of $255 million reported in the first quarter of 2014 and $157 million reported in the quarter ended June 30, 2013. Adjusted net income¹ was $91 million ($0.94 per share on a diluted basis) in the second quarter of 2014, compared to Adjusted net income¹ of $160 million ($1.65 per share on a diluted basis) for the first quarter of 2014 and $99 million ($1.02 per share on a diluted basis) for the second quarter of 2013.

John Floren, President and CEO of Methanex commented, "Methanol prices are lower in Q2 2014 compared to Q1 2014, resulting in lower Q2 earnings as compared to the first quarter. We believe pricing is now stabilizing at current levels." Mr. Floren added, "At these methanol prices, Methanex continues to generate strong EBITDA and cash flows. The methanol industry environment remains favourable, with steady demand and limited new supply additions expected in the near to medium term."

Mr. Floren added, "We are making excellent progress on the relocation of two of our Chile plants to Geismar, Louisiana, and are targeting methanol production from our Geismar 1 facility in late 2014 and Geismar 2 in early 2016. Each of these plants will add an incremental one million tonnes to our operating capacity."

"In the second quarter we also reached a settlement agreement with Total Austral S.A. of Argentina and received a lump sum payment of US$42 million, or $27 million net of tax, to terminate their obligations under their former long-term natural gas supply agreement with Methanex in Chile. This payment is not included in our Q2 2014 Adjusted EBITDA or Adjusted net income but has been recorded in Q2 2014 Net income attributable to Methanex shareholders."

"During the quarter, we returned over $100 million in cash to shareholders in the form of dividends and share repurchases. With over $600 million of cash on hand, an undrawn credit facility, robust balance sheet, and strong cash flow generation, we are well positioned to meet our financial commitments, invest to grow the Company and return excess cash to shareholders through dividends and our share buyback program."

A conference call is scheduled for July 31, 2014 at 12:00 noon ET (9:00 am PT) to review these second quarter results. To access the call, dial the conferencing operator ten minutes prior to the start of the call at (416) 340-2218, or toll free at (866) 226-1793. A playback version of the conference call will be available until August 21, 2014 at (905) 694-9451, or toll free at (800) 408-3053. The passcode for the playback version is 2070181. Presentation slides summarizing Q2-14 results and a simultaneous audio-only webcast of the conference call can be accessed from our website at www.methanex.com. The webcast will be available on the website for three weeks following the call.

Methanex is a Vancouver-based, publicly traded company and is the world's largest producer and supplier of methanol to major international markets. Methanex shares are listed for trading on the Toronto Stock Exchange in Canada under the trading symbol "MX" and on the NASDAQ Global Market in the United States under the trading symbol "MEOH".

FORWARD-LOOKING INFORMATION WARNING

This Second Quarter 2014 press release contains forward-looking statements with respect to us and the chemical industry. Refer to Forward-Looking Information Warning in the attached Second Quarter 2014 Management's Discussion and Analysis for more information.

Interim Report for the Three Months Ended June 30, 2014

At July 30, 2014 the Company had 94,323,459 common shares issued and outstanding and stock options exercisable for 1,585,616 additional common shares.

Share Information

Methanex Corporation's common shares are listed for trading on the Toronto Stock Exchange under the symbol MX and on the Nasdaq Global Market under the symbol MEOH.

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SECOND QUARTER MANAGEMENT'S DISCUSSION AND ANALYSIS

Except where otherwise noted, all currency amounts are stated in United States dollars.

FINANCIAL AND OPERATIONAL HIGHLIGHTS

• A reconciliation from net income attributable to Methanex shareholders to Adjusted net income¹ and the calculation of Adjusted net income per common share¹ is as follows:

• We recorded Adjusted EBITDA¹ of $160 million for the second quarter of 2014 compared with $255 million for the first quarter of 2014. The decrease in Adjusted EBITDA¹ was primarily due to a decrease in our average realized price to $450 per tonne for the second quarter of 2014 from $524 per tonne for the first quarter of 2014 and a decrease in sales of Methanex-produced methanol.

• Production for the second quarter of 2014 was 1,216,000 tonnes compared with 1,226,000 tonnes for the first quarter of 2014. Refer to the Production Summary section.

• Sales of Methanex-produced methanol were 1,143,000 tonnes in the second quarter of 2014 compared with 1,228,000 in the first quarter of 2014.

• We continue to progress our Geismar relocation projects. We are targeting to be producing methanol from Geismar 1 in late 2014 and from Geismar 2 in early 2016.

• During the quarter, we reached a settlement with Total Austral S.A. ("Total") for $42 million ($27 million net of tax) in relation to Total's natural gas delivery obligations pursuant to a long-term natural gas supply agreement in Chile.

• During the second quarter of 2014, we paid a $0.25 per share dividend to shareholders for a total of $24 million.

• During the second quarter of 2014, we repurchased 1,371,447 common shares for $82 million for an average buyback price of $59.99 per share under the Normal Course Issuer Bid approved by the Board in late April. The shares repurchased in the quarter represent 28% of the total shares approved to be repurchased.

This Second Quarter 2014 Management's Discussion and Analysis ("MD&A") dated July 30, 2014 for Methanex Corporation ("the Company") should be read in conjunction with the Company's condensed consolidated interim financial statements for the period ended June 30, 2014 as well as the 2013 Annual Consolidated Financial Statements and MD&A included in the Methanex 2013 Annual Report. Unless otherwise indicated, the financial information presented in this interim report is prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). The Methanex 2013 Annual Report and additional information relating to Methanex is available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.

FINANCIAL AND OPERATIONAL DATA

PRODUCTION SUMMARY

New Zealand

Our New Zealand methanol facilities produced 559,000 tonnes of methanol in the second quarter of 2014 compared with 500,000 tonnes in the first quarter of 2014. With all three facilities now operating, we are able to produce up to 2.4 million tonnes annually, depending on natural gas composition.

Trinidad

In Trinidad, we own 100% of the Titan facility with an annual production capacity of 875,000 tonnes and have a 63.1% interest in the Atlas facility with an annual production capacity of 1,125,000 tonnes (63.1% interest). The Titan facility produced 203,000 tonnes in the second quarter of 2014 compared with 149,000 tonnes in the first quarter of 2014. The Atlas facility produced 191,000 tonnes in the second quarter of 2014 compared with 249,000 tonnes in the first quarter of 2014. The Atlas facility had ongoing production interruptions due to mechanical problems with the air separation unit.

We continue to experience some natural gas curtailments to our Trinidad facilities due to a mismatch between upstream commitments to supply the Natural Gas Company of Trinidad and Tobago (NGC) and downstream demand from NGC's customers including Atlas and Titan, which becomes apparent when an upstream supplier has a technical issue or planned maintenance that reduces gas delivery. We are engaged with key stakeholders to find a solution to this issue, but in the meantime expect to continue to experience gas curtailments to the Trinidad site. Gas curtailments in Q2 2014 were slightly higher than in Q1 2014.

Egypt

On a 100% basis, the Egypt methanol facility produced 198,000 tonnes in the second quarter of 2014 (Methanex share of 99,000 tonnes) compared with 278,000 tonnes (Methanex share of 139,000 tonnes) in the first quarter of 2014. Production during the second quarter of 2014 continued to be impacted by natural gas supply restrictions and we idled the plant in mid-June due to a lack of natural gas availability. We believe that we will be able to restart the plant after the peak summer electricity consumption period ends.

The Egypt facility has experienced periodic natural gas supply restrictions since mid-2012 which have resulted in production below full capacity. This situation may persist in the future and becomes more acute during the summer months when electricity demand is at its peak. Refer to page 23 of the Risk Factors and Risk Management section of our 2013 Annual Report for further details.

Medicine Hat, Canada

During the second quarter of 2014, we produced 138,000 tonnes at our Medicine Hat facility compared with 122,000 tonnes during the first quarter of 2014.

Chile

During the second quarter of 2014, we produced 26,000 tonnes in Chile compared with 67,000 tonnes in the first quarter of 2014, supported by natural gas supplies from Chile and from Argentina through a tolling arrangement.

As a result of insufficient natural gas feedstock from Chile and Argentina during the southern hemisphere winter, we idled our Chile operations in May 2014. We are optimistic that we will secure sufficient natural gas from Chilean sources supplemented by Argentine gas to restart our operations later in 2014.

The future of our Chile operations is primarily dependent on the level of natural gas exploration and development in southern Chile and our ability to secure a sustainable natural gas supply to our facilities on economic terms from Chile and Argentina.

Geismar, Louisiana

We continue to progress our two Geismar relocation projects. We are targeting to be producing methanol from the 1.0 million tonne Geismar 1 facility in late 2014 and from the 1.0 million tonne Geismar 2 facility in early 2016. During the second quarter of 2014, we incurred $100 million of capital expenditures related to these projects, excluding capitalized interest.

FINANCIAL RESULTS

For the second quarter of 2014 we recorded Adjusted EBITDA of $160 million and Adjusted net income of $91 million ($0.94 per share on a diluted basis). This compares with Adjusted EBITDA of $255 million and Adjusted net income of $160 million ($1.65 per share on a diluted basis) for the first quarter of 2014.

For the second quarter of 2014, we reported net income attributable to Methanex shareholders of $125 million ($1.24 per share on a diluted basis) compared with net income attributable to Methanex shareholders for the first quarter of 2014 of $145 million ($1.50 income per share on a diluted basis).

We calculate Adjusted EBITDA and Adjusted net income by including amounts related to our equity share of the Atlas (63.1% interest) and Egypt (50% interest) facilities and by excluding the mark-to-market impact of share-based compensation as a result of changes in our share price and items which are considered by management to be non-operational. Refer to the Additional Information - Supplemental Non-GAAP Measures section for a further discussion on how we calculate these measures. Our analysis of depreciation and amortization, finance costs, finance income and other expenses and income taxes is consistent with the presentation of our consolidated statements of income and excludes amounts related to Atlas.

A reconciliation from net income attributable to Methanex shareholders to Adjusted net income and the calculation of Adjusted net income per common share is as follows:

We review our financial results by analyzing changes in Adjusted EBITDA, mark-to-market impact of share-based compensation, depreciation and amortization, Argentina gas settlements, write-off of oil and gas rights, Geismar project relocation expenses, finance costs, finance income and other expenses and income taxes. A summary of our consolidated statements of income is as follows:

Adjusted EBITDA (Attributable to Methanex Shareholders)

Our operations consist of a single operating segment - the production and sale of methanol. We review the results of operations by analyzing changes in the components of Adjusted EBITDA. For a discussion of the definitions used in our Adjusted EBITDA analysis, refer to the How We Analyze Our Business section.

The changes in Adjusted EBITDA resulted from changes in the following:

Average realized price

Methanol pricing for the second quarter was lower compared to the first quarter as the industry recovered from very tight market conditions experienced in late 2013 and early 2014 with multiple suppliers resuming operations after extended periods of closure or reduced operating rates. As a result of these and other factors, prices moderated from the high levels in Q1 and began to stabilize late in the quarter and into the third quarter of 2014. We believe that pricing is now stabilizing at current levels (refer to the Supply/Demand Fundamentals section). Our average non-discounted posted price for the second quarter of 2014 was $523 per tonne compared with $613 per tonne for the first quarter of 2014 and $494 per tonne for the second quarter of 2013. Our average realized price for the second quarter of 2014 was $450 per tonne compared with $524 per tonne for the first quarter of 2014 and $425 per tonne for the second quarter of 2013. The change in average realized price for the second quarter of 2014 decreased Adjusted EBITDA by $134 million compared with the first quarter of 2014 and increased Adjusted EBITDA by $44 million compared with the second quarter of 2013.

Sales volume

Methanol sales volumes excluding commission sales volumes were lower in the second quarter of 2014 compared with the first quarter of 2014 by 96,000 tonnes and with the second quarter of 2013 by 2,000 tonnes. Lower methanol sales volumes excluding commission sales volumes for these periods decreased Adjusted EBITDA by $12 million and $1 million, respectively. For the six month period ended June 30, 2014 compared with the same period in 2013, methanol sales volumes excluding commission sales volumes were higher by 262,000 tonnes and this resulted in higher Adjusted EBITDA by $26 million.

Total cash costs

The primary drivers of changes in our total cash costs are changes in the cost of methanol we produce at our facilities (Methanex-produced methanol) and changes in the cost of methanol we purchase from others (purchased methanol). All of our production facilities except Medicine Hat are underpinned by natural gas purchase agreements with pricing terms that include base and variable price components linked to the price of methanol. We supplement our production with methanol produced by others through methanol offtake contracts and purchases on the spot market to meet customer needs and support our marketing efforts within the major global markets.

We have adopted the first-in, first-out method of accounting for inventories and it generally takes between 30 and 60 days to sell the methanol we produce or purchase. Accordingly, the changes in Adjusted EBITDA as a result of changes in Methanex-produced and purchased methanol costs primarily depend on changes in methanol pricing and the timing of inventory flows.

In a rising price environment, our margins at a given price are higher than in a stable price environment as a result of timing of methanol purchases and production versus sales. Conversely, the opposite applies when methanol prices are decreasing.

The impact on Adjusted EBITDA from changes in our cash costs are explained below:

Methanex-produced methanol costs

We purchase natural gas for the New Zealand, Trinidad, Egypt, and Chile methanol facilities under natural gas purchase agreements where the unique terms of each contract include a base price and a variable price component linked to the price of methanol to reduce our commodity price risk exposure. The variable price component of each gas contract is adjusted by a formula related to methanol prices above a certain level. For the second quarter of 2014 compared with the first quarter of 2014, Methanex-produced methanol costs were lower by $18 million, primarily due to the impact of lower realized methanol prices on the variable portion of our natural gas costs. For the three and six month periods ended June 30, 2014 compared with the same periods in 2013, Methanex-produced methanol costs were higher by $25 million and $75 million, respectively, primarily due to the impact of higher realized methanol prices on our natural gas costs and changes in the mix of production sold from inventory.

Proportion of Methanex-produced methanol sales

The cost of purchased methanol is directly linked to the selling price for methanol at the time of purchase and the cost of purchased methanol is generally higher than the cost of Methanex-produced methanol. Accordingly, an increase in the proportion of Methanex-produced methanol sales results in a decrease in our overall cost structure for a given period. For the second quarter of 2014 compared with the first quarter of 2014, a lower proportion of Methanex-produced methanol sales decreased Adjusted EBITDA by $4 million. For the second quarter of 2014 compared with the same period in 2013, sales of Methanex-produced methanol made up a higher proportion of our total sales and this increased Adjusted EBITDA by $20 million.

Purchased methanol costs

Changes in purchased methanol costs for all periods presented are primarily as a result of changes in methanol pricing.

Other, net

We have commenced the process of building a manufacturing organization in Geismar, Louisiana. Under IFRS, costs incurred related to organizational build-up are not eligible for capitalization and are charged directly to earnings as incurred. During the second quarter of 2014, we incurred approximately $2 million of Geismar organizational build-up costs compared to $3 million in the first quarter of 2014 and nil in the second quarter of 2013. The remaining organizational build-up costs are estimated to be approximately $20 million.

Mark-to-Market Impact of Share-based Compensation

We grant share-based awards as an element of compensation. Share-based awards granted include stock options, share appreciation rights, tandem share appreciation rights, deferred share units, restricted share units and performance share units. For all the share-based awards, share-based compensation is recognized over the related vesting period for the proportion of the service that has been rendered at each reporting date. Share-based compensation includes an amount related to the grant-date value and a mark-to-market impact as a result of subsequent changes in the Company's share price. The grant-date value amount is included in Adjusted EBITDA and Adjusted net income. The mark-to-market impact of share-based compensation as a result of changes in our share price is excluded from Adjusted EBITDA and Adjusted net income and analyzed separately.

The Methanex Corporation share price decreased from US $63.94 per share at March 31, 2014 to US $61.78 per share at June 30, 2014. As a result of the decrease in the share price and the resulting impact on the fair value of the outstanding units, we recorded an $8 million mark-to-market recovery on share-based compensation in the second quarter of 2014 compared with an $18 million mark-to-market expense in the first quarter of 2014 and a $9 million expense in the second quarter of 2013.

Depreciation and Amortization

Depreciation and amortization was $33 million for the second quarter of 2014 compared with $35 million for the first quarter of 2014 and $29 million for the second quarter of 2013. Depreciation and amortization was lower in the second quarter of 2014 compared with the first quarter of 2014 primarily due to lower sales volumes of Methanex-produced methanol.

Finance Costs

Finance costs before capitalized interest primarily relate to interest expense on the unsecured notes and limited recourse debt facilities. Capitalized interest relates to interest costs capitalized for the Geismar projects.

Finance Income and Other Expenses

The change in finance income and other expenses for all periods presented was primarily due to the impact of changes in foreign exchange rates.

Income Taxes

A summary of our income taxes for the second quarter of 2014 compared with the first quarter of 2014 is as follows:

For the second quarter of 2014, the effective tax rate was 25% compared with 24% for the first quarter of 2014. Adjusted net income represents the amount that is attributable to Methanex shareholders and excludes the mark-to-market impact of share-based compensation and items that are considered by management to be non-operational. The effective tax rate related to Adjusted net income was 24% for the second quarter of 2014 compared with 24% for the first quarter of 2014.

We earn the majority of our earnings in Trinidad, Egypt, Chile, Canada and New Zealand. In Trinidad and Chile, the statutory tax rate is 35%. The statutory rates in Canada and New Zealand are 25% and 28%, respectively. During the quarter, there was a temporary change to the Egypt statutory tax rate to 30% from 25% for the years 2014 to 2016. As the Atlas entity is accounted for using the equity method, any income taxes related to Atlas are included in earnings of associate and therefore excluded from total income taxes.

SUPPLY/DEMAND FUNDAMENTALS

We estimate that methanol demand, excluding methanol demand from integrated methanol to olefins facilities, is currently approximately 57 million tonnes on an annualized basis.

In the fourth quarter of 2013 and into the first quarter of 2014, we experienced very tight methanol market conditions and high methanol pricing primarily as a result of major industry supply issues in Asia and the Middle East. As several of these plants returned to operation late in the first quarter, pricing moderated through the quarter, stabilizing in June and into Q3. As a result, our average non-discounted price in the second quarter of 2014 was $523 per tonne compared with $613 per tonne in the first quarter of 2014 and we recently announced our North American non-discounted price for August at $482/tonne, and our Asia Pacific price at $410/tonne, both unchanged from July. In June, we announced the Q3 European contract price at EUR322 or approximately $440/tonne.

The medium term outlook for methanol demand growth continues to be strong, led by the growing use of methanol in energy-related applications which today represent approximately 40% of global methanol demand. The wide disparity between the price of crude oil and that of natural gas and coal has resulted in an increased substitution of methanol into energy-related applications, such as direct methanol blending into gasoline, DME and biodiesel production. Growth of direct methanol blending into gasoline in China has been particularly strong and we believe that future growth in this application is supported by numerous provincial fuel-blending standards, such as M15 or M85 (15% methanol and 85% methanol, respectively). Fuel blending is also starting to gain interest outside of China with several countries currently conducting demonstration programs to test the use of methanol-blended fuels.

China is also leading the commercialization of methanol's use as a feedstock to manufacture olefins. Methanol-to-olefins (MTO) technology, at current energy prices, is proving to be cost competitive relative to the traditional production of olefins from naphtha. There are now three MTO plants operating in China which are dependent on merchant methanol supply and which have the capacity to consume over 3 million tonnes of methanol annually, and there are a number of other plants at various stages of construction which we expect will commence operations in the 2014-15 timeframe. There are other coal-to-olefins (CTO) plants which make methanol using coal as a feedstock and are integrated with olefins production facilities. These plants occasionally purchase methanol to supplement their production when required. We believe demand potential into energy-related applications and olefins production will continue to grow.

Traditional chemical derivatives consume about 60% of global methanol demand and growth is correlated to industrial production growth rates.

The methanol price will ultimately depend on the strength of the global economy, industry operating rates, global energy prices, new supply additions and the strength of global demand. Over the next few years, there is a modest level of new capacity expected to come on-stream relative to demand growth expectations. We are relocating two idle Chile facilities to Geismar, Louisiana and are targeting to be producing methanol from the first 1.0 million tonne facility by late 2014 and the second 1.0 million tonne facility in early 2016. In addition, a 1.3 million tonne Celanese plant is currently under construction in Bishop, Texas. We expect that production from new capacity in China will be consumed in that country and that higher cost production capacity in China will need to operate in order to satisfy demand growth.

LIQUIDITY AND CAPITAL RESOURCES

Cash flows from operating activities in the second quarter of 2014 increased by $61 million to $240 million compared with $179 million for the first quarter of 2014 and increased by $115 million compared to $125 million for the second quarter of 2013. The changes in cash flows from operating activities resulted from changes in the following:

During the second quarter of 2014, we paid a quarterly dividend of $0.25 per share, or $24 million. On April 29, 2014, the Board of Directors approved a 5% normal course issuer bid, which allows us to repurchase for cancellation up to 4.8 million shares. In the second quarter of 2014 we repurchased 1.4 million shares for cancellation under the normal course issuer bid at an average price of $59.99 per share.

We operate in a highly competitive commodity industry and believe it is appropriate to maintain a conservative balance sheet and retain financial flexibility. At June 30, 2014, our cash balance was $647 million, including $65 million related to the 50% non-controlling interest in Egypt. We invest our cash only in highly rated instruments that have maturities of three months or less to ensure preservation of capital and appropriate liquidity. We have a strong balance sheet and an undrawn $400 million credit facility that expires in late 2016.

Our planned capital maintenance expenditure program directed towards maintenance, turnarounds and catalyst changes for existing operations is currently estimated to be $130 million for the 18 month period to the end of 2015. Capital expenditures during the second quarter, excluding the Geismar projects, were $16 million. We are relocating two methanol plants from our Chile site to Geismar, Louisiana. During the second quarter of 2014, capital expenditures related to the Geismar projects were $100 million, excluding capitalized interest. The remaining budgeted capital expenditures related to the Geismar projects are $405 million, excluding capitalized interest.

We believe we are well positioned to meet our financial commitments, invest to grow the Company and continue to deliver on our commitment to return excess cash to shareholders.

SHORT-TERM OUTLOOK

Methanol prices moderated through the second quarter. Entering the third quarter, methanol prices have been relatively stable. We recently announced our August contract prices for Asia at US$410/MT and for North America at US$482/MT, unchanged at the previous month's levels. Methanol prices will ultimately depend on the strength of the global economy, industry operating rates, global energy prices, new supply additions and the strength of global demand. We believe that our financial position and financial flexibility, outstanding global supply network and competitive-cost position will provide a sound basis for Methanex to continue to be the leader in the methanol industry and to invest to grow the Company.

CONTROLS AND PROCEDURES

For the three months ended June 30, 2014, no changes were made in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

ADDITIONAL INFORMATION - SUPPLEMENTAL NON-GAAP MEASURES

In addition to providing measures prepared in accordance with International Financial Reporting Standards (IFRS), we present certain supplemental non-GAAP measures. These are Adjusted EBITDA, Adjusted net income, Adjusted net income per common share and operating income. These measures do not have any standardized meaning prescribed by generally accepted accounting principles (GAAP) and therefore are unlikely to be comparable to similar measures presented by other companies. These supplemental non-GAAP measures are provided to assist readers in determining our ability to generate cash from operations and improve the comparability of our results from one period to another. We believe these measures are useful in assessing operating performance and liquidity of the Company's ongoing business on an overall basis. We also believe Adjusted EBITDA is frequently used by securities analysts and investors when comparing our results with those of other companies.

Adjusted EBITDA (attributable to Methanex shareholders)

Adjusted EBITDA differs from the most comparable GAAP measure, net income attributable to Methanex shareholders, because it excludes depreciation and amortization, finance costs, finance income and other expenses, income tax expense, mark-to-market impact of share-based compensation, Geismar project relocation expenses and charges, write-off of oil and gas rights, and the Argentina gas settlement. Adjusted EBITDA includes an amount representing our 63.1% interest in the Atlas facility and our 50% interest in the methanol facility in Egypt.

Adjusted EBITDA and Adjusted net income exclude the mark-to-market impact of share-based compensation related to the impact of changes in our share price on share appreciation rights, tandem share appreciation rights, deferred share units, restricted share units and performance share units. The mark-to-market impact related to performance share units that is excluded from Adjusted EBITDA and Adjusted net income is calculated as the difference between the grant date value determined using a Methanex total shareholder return factor of 100% and the fair value recorded at each period end. As share-based awards will be settled in future periods, the ultimate value of the units is unknown at the date of grant and therefore the grant date value recognized in Adjusted EBITDA and Adjusted net income may differ from the total settlement cost.

The following table shows a reconciliation from net income attributable to Methanex shareholders to Adjusted EBITDA:

Adjusted Net Income and Adjusted Net Income per Common Share

Adjusted net income and Adjusted net income per common share are non-GAAP measures because they exclude the mark-to-market impact of share-based compensation and items that are considered by management to be non-operational, including Geismar project relocation expenses and charges, write-off of oil and gas rights, and the Argentina gas settlement. The following table shows a reconciliation of net income attributable to Methanex shareholders to Adjusted net income and the calculation of Adjusted net income per common share:

Operating Income

Operating income is reconciled directly to a GAAP measure in our consolidated statements of income.

QUARTERLY FINANCIAL DATA (UNAUDITED)

A summary of selected financial information for the prior eight quarters is as follows:

FORWARD-LOOKING INFORMATION WARNING

This Second Quarter 2014 Management's Discussion and Analysis ("MD&A") as well as comments made during the Second Quarter 2014 investor conference call contain forward-looking statements with respect to us and our industry. These statements relate to future events or our future performance. All statements other than statements of historical fact are forward-looking statements. Statements that include the words "believes", "expects", "may", "will", "should", "potential", "estimates", "anticipates", "aim", "goal" or other comparable terminology and similar statements of a future or forward-looking nature identify forward-looking statements.

More particularly and without limitation, any statements regarding the following are forward-looking statements:

• expected demand for methanol and its derivatives,

• expected new methanol supply or restart of idled capacity and timing for start-up of the same,

• expected shutdowns (either temporary or permanent) or restarts of existing methanol supply (including our own facilities), including, without limitation, the timing and length of planned maintenance outages,

• expected methanol and energy prices,

• expected levels of methanol purchases from traders or other third parties,

• expected levels, timing and availability of economically priced natural gas supply to each of our plants,

• capital committed by third parties towards future natural gas exploration and development in the vicinity of our plants,

• our expected capital expenditures,

• anticipated operating rates of our plants,

• expected operating costs, including natural gas feedstock costs and logistics costs,

• expected tax rates or resolutions to tax disputes,

• expected cash flows, earnings capability and share price,

• availability of committed credit facilities and other financing,

• ability to meet covenants or obtain or continue to obtain waivers associated with our long-term debt obligations, including, without limitation, the Egypt limited recourse debt facilities that have conditions associated with the payment of cash or other distributions and the finalization of certain land title registration and related mortgages that require action by Egyptian governmental entities,

• our shareholder distribution strategy and anticipated distributions to shareholders,

• commercial viability and timing of, or our ability to execute, future projects, plant restarts, capacity expansions, plant relocations, or other business initiatives or opportunities, including the planned relocation of idle Chile methanol plants to Geismar, Louisiana ("Geismar"),

• our financial strength and ability to meet future financial commitments,

• expected global or regional economic activity (including industrial production levels),

• expected outcomes of litigation or other disputes, claims and assessments,

• expected actions of governments, government agencies, gas suppliers, courts, tribunals or other third parties, and

• expected impact on our operations in Egypt or our financial condition as a consequence of civil unrest or actions taken or inaction by the Government of Egypt and its agencies.

We believe that we have a reasonable basis for making such forward-looking statements. The forward-looking statements in this document are based on our experience, our perception of trends, current conditions and expected future developments as well as other factors. Certain material factors or assumptions were applied in drawing the conclusions or making the forecasts or projections that are included in these forward-looking statements, including, without limitation, future expectations and assumptions concerning the following:

• the supply of, demand for and price of methanol, methanol derivatives, natural gas, coal, oil and oil derivatives,

• our ability to procure natural gas feedstock on commercially acceptable terms,

• operating rates of our facilities,

• receipt or issuance of third-party consents or approvals, including, without limitation, governmental registrations of land title and related mortgages in Egypt, governmental approvals related to rights to purchase natural gas,

• the establishment of new fuel standards,

• operating costs including natural gas feedstock and logistics costs, capital costs, tax rates, cash flows, foreign exchange rates and interest rates,

• the availability of committed credit facilities and other financing,

• timing of completion and cost of our Geismar project,

• global and regional economic activity (including industrial production levels),

• absence of a material negative impact from major natural disasters,

• absence of a material negative impact from changes in laws or regulations,

• absence of a material negative impact from political instability in the countries in which we operate, and

• enforcement of contractual arrangements and ability to perform contractual obligations by customers, natural gas and other suppliers and other third parties.

However, forward-looking statements, by their nature, involve risks and uncertainties that could cause actual results to differ materially from those contemplated by the forward-looking statements. The risks and uncertainties primarily include those attendant with producing and marketing methanol and successfully carrying out major capital expenditure projects in various jurisdictions, including, without limitation:

• conditions in the methanol and other industries including fluctuations in the supply, demand for and price of methanol and its derivatives, including demand for methanol for energy uses,

• the price of natural gas, coal, oil and oil derivatives,

• the success of natural gas exploration and development activities in southern Chile,

• our ability to obtain natural gas feedstock on commercially acceptable terms to underpin current operations and future production growth opportunities,

• the ability to successfully carry out corporate initiatives and strategies,

• actions of competitors, suppliers and financial institutions,

• conditions within the natural gas delivery systems that may prevent delivery of our natural gas supply requirements,

• our ability to meet timeline and budget targets for our Geismar project, including cost pressures arising from labour costs,

• competing demand for natural gas, especially with respect to domestic needs for gas and electricity in Chile and Egypt,

• actions of governments and governmental authorities, including, without limitation, the implementation of policies or other measures that could impact the supply of or demand for methanol or its derivatives,

• changes in laws or regulations,

• import or export restrictions, anti-dumping measures, increases in duties, taxes and government royalties, and other actions by governments that may adversely affect our operations or existing contractual arrangements,

• world-wide economic conditions,

• satisfaction of conditions precedent contained in the Geismar 1 natural gas supply agreement, and

• other risks described in our 2013 Management's Discussion and Analysis and this Second Quarter 2014 Management's Discussion and Analysis.

Having in mind these and other factors, investors and other readers are cautioned not to place undue reliance on forward-looking statements. They are not a substitute for the exercise of one's own due diligence and judgment. The outcomes anticipated in forward-looking statements may not occur and we do not undertake to update forward-looking statements except as required by applicable securities laws.

HOW WE ANALYZE OUR BUSINESS

Our operations consist of a single operating segment - the production and sale of methanol. We review our results of operations by analyzing changes in the components of Adjusted EBITDA (refer to the Additional Information - Supplemental Non-GAAP Measures section for a description of each non-GAAP measure and reconciliations to the most comparable GAAP measures).

In addition to the methanol that we produce at our facilities ("Methanex-produced methanol"), we also purchase and re-sell methanol produced by others ("purchased methanol") and we sell methanol on a commission basis. We analyze the results of all methanol sales together, excluding commission sales volumes. The key drivers of changes in Adjusted EBITDA are average realized price, cash costs and sales volume which are defined and calculated as follows:

We own 63.1% of the Atlas methanol facility and market the remaining 36.9% of its production through a commission offtake agreement. A contractual agreement between us and our partners establishes joint control over Atlas. As a result, we account for this investment using the equity method of accounting, which results in 63.1% of the net assets and net earnings of Atlas being presented separately in the consolidated statements of financial position and consolidated statements of income, respectively. For purposes of analyzing our business, Adjusted EBITDA, Adjusted net income and Adjusted net income per common share include an amount representing our 63.1% equity share in Atlas.

On December 9, 2013, we completed the sale of a 10% equity interest in the Egypt methanol facility. At June 30, 2014, we own 50% of the 1.26 million tonne per year Egypt methanol facility and market the remaining 50% of its production through a commission offtake agreement. We account for this investment using consolidation accounting, which results in 100% of the revenues and expenses being included in our financial statements with the other investors' interests in the methanol facility being presented as "non-controlling interests". For purposes of analyzing our business, Adjusted EBITDA, Adjusted net income and Adjusted net income per common share exclude the amount associated with the other investors' non-controlling interests.