Methanex Takes Additional Steps to Strengthen Balance Sheet and Liquidity
April 29 2020 - 7:23PM
Methanex Corporation (TSX:MX) (NASDAQ:MEOH) announced today that,
in addition to the actions previously announced, it is taking
additional measures to enable greater financial flexibility and
preserve liquidity in response to the current uncertain market
conditions caused by the COVID-19 pandemic and low oil price
environment.
The Company is working with its banking partners
to obtain flexibility on certain financial covenants in its
existing $300 million committed revolving credit facility and $800
million non-revolving construction facility. The Company has agreed
on key parameters with its lead bank and is working with the other
members of the bank syndicate to finalize these changes to the
credit facilities, which is expected in the second half of May.
In addition, the board of directors approved a
90 percent reduction in the quarterly cash dividend to $0.0375 per
share from $0.36 per share. The reduction of our dividend
represents approximately $100 million in annualized cash savings.
The new dividend declared will be payable on June 30, 2020 to
holders of common shares of record on June 16, 2020.
John Floren, President & CEO, commented, “We
remain committed to creating long-term value for our shareholders
while maintaining a strong financial position. We believe that the
changes to our credit facilities and taking the prudent decision to
reduce the dividend will provide us with enhanced financial
flexibility and will preserve liquidity to enable us to navigate
the current challenging business and commodity price environment
and emerge financially strong.”
As previously announced, Methanex will report
its Q1 2020 earnings results on May 5, 2020 and hold its earnings
conference call on May 6, 2020 at 11:00AM Eastern Time (08:00AM
Pacific Time).
About Methanex
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”. Methanex can be visited
online at www.methanex.com.
Forward-Looking Information
Warning
This news release contains 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," "will," 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 cash flows, earnings capability and share price;
- availability of committed credit facilities and other
financing;
- our ability to meet covenants or obtain or continue to obtain
waivers associated with our long-term debt obligations;
- our shareholder distribution strategy and anticipated
distributions to shareholders;
- our financial strength and ability to meet future financial
commitments;
- the potential future impact of the COVID-19 pandemic.
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; and
- the availability of committed credit facilities and other
financing.
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 and price for methanol and its
derivatives, including demand for methanol for energy uses;
- actions of competitors, suppliers and financial
institutions;
- worldwide economic conditions;
- the future impact of the COVID-19 pandemic; and
- other risks described in our 2019 Annual Management’s
Discussion and Analysis and our Fourth Quarter 2019 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
implied by forward-looking statements may not occur and we do not
undertake to update forward-looking statements except as required
by applicable securities laws.
For further information, contact:
Kim CampbellDirector, Investor RelationsMethanex
Corporation604 661 2600 or Toll Free: 1 800 661
8851www.methanex.com
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