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A month has gone by since the last earnings report for Methanex (MEOH). Shares have lost about 15.3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Methanex due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Methanex’s Q4 Earnings Outpace Estimates, Revenues Miss
Methanex reported a fourth-quarter 2024 net income of $45 million or 67 cents per share, an increase from the prior-year quarter’s profits of $33 million or 50 cents per share.
Adjusted earnings per share rose to $1.24 from the year-ago quarter’s 52 cents. The figure surpassed the Zacks Consensus Estimate of $1.01.
Net sales in the quarter stood at $949 million, missing the Zacks Consensus Estimate of $1,023.7 million. However, revenues displayed growth of roughly 3% from the year-ago quarter’s results.
Adjusted EBITDA in the reported quarter climbed 105.7% year over year to $216 million.
Operational Highlights
Production in the quarter was 1,868,000 tons, up around 5% year over year. Production was driven by higher production in Chile, New Zealand, Geismar and Egypt.
The sales volume for the reported quarter was 2,564,000 tons, down around 10% year over year and below our estimate of 2,727,000 tons.
The average realized price per ton of methanol increased from $356 in the previous quarter and $322 in the year-ago quarter to $370, beating our estimate of $368. The increase can be attributed to stable global demand on a backdrop of tight market conditions from lower supply compared to the previous quarter.
FY24 Results
Net sales for 2024 were $3,720 million, down from $3,723 million for the same period in 2023. Adjusted earnings for the full year were $3.72 per share, rising from $2.25 per share in 2023.
Financials
In 2024, Methanex returned $50 million to shareholders through regular dividends and the $300 million bond due in December was repaid with cash flows generated from operations. The fourth quarter saw an operating cash flow of $281 million. Methanex ended the year with $892 million in cash.
Outlook
The company’s production guidance for 2025 is approximately 7.5 million tons (Methanex interest), which excludes any additional production from OCI assets after the acquisition closing date. Actual production may vary quarterly based on gas availability, turnarounds, unplanned outages and unanticipated events.