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Methanex's (MEOH) Q1 Earnings & Revenues Surpass Estimates

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Methanex Corporation (MEOH - Free Report) logged a first-quarter 2023 profit (attributable to shareholders) of $60 million or 87 cents per share, down from $119 million or $1.60 per share in the year-ago quarter.

Adjusted earnings per share (barring one-time items) in the reported quarter were $1.11, topping the Zacks Consensus Estimate of 92 cents.

Revenues fell 11.7% year over year to $1,038 million in the quarter. The top line, however, beat the Zacks Consensus Estimate of $975 million.

Adjusted EBITDA in the reported quarter fell around 38% year over year to $209 million. The results were hurt by lower average realized prices.

Methanex Corporation Price, Consensus and EPS Surprise

Methanex Corporation Price, Consensus and EPS Surprise

Methanex Corporation price-consensus-eps-surprise-chart | Methanex Corporation Quote

Operational Highlights

Production in the quarter totaled 1,660,000 tons, down 7.2% year over year. Production was, however, higher than the prior quarter, which was affected by an extended turnaround in Egypt, gas restrictions in Chile and outages in Geismar and Trinidad.

Total sales volume in the first quarter totaled 2,805,000 tons, up 1.7% year over year.

The average realized price for methanol was $371 per ton in the quarter, down from $425 per ton in the prior-year quarter.

Financials

Cash and cash equivalents were $780 million at the end of the quarter. Long-term debt at the end of the quarter was $2,133.8 million.

Cash flow from operating activities was $162 million in the quarter.

The company returned $60 million to shareholders through dividends and share repurchases in the reported quarter.

Outlook

Methanex forecasts production for 2023 to be 1.3-1.4 million tons in New Zealand and 0.8-0.9 million tons in Chile.

Production for 2023 is expected to be at 6.5 million tons, excluding any Geismar 3 output. Actual output may vary quarterly due to turnaround schedule, gas availability, unforeseen outages and unanticipated events, MEOH noted.

Price Performance

Shares of Methanex have lost 12.1% in the past year compared with a 4.2% decline of the industry.

Zacks Investment Research
Image Source: Zacks Investment Research

Zacks Rank & Other Key Picks

MEOH currently carries a Zacks Rank #2 (Buy).

Other top-ranked stocks in the Basic Materials space include Steel Dynamics, Inc. (STLD - Free Report) , Linde plc (LIN - Free Report) and PPG Industries, Inc. (PPG - Free Report)

Steel Dynamics currently carries a Zacks Rank #1 (Strong Buy). Shares of STLD have gained 15.9% in the past year. It topped the Zacks Consensus Estimate in all the last four quarters. It delivered a trailing four-quarter earnings surprise of 10.7% on average. You can see the complete list of today’s Zacks #1 Rank stocks here.

Linde, currently carrying a Zacks Rank #2, has a projected earnings growth rate of 9.1% for the current year. The Zacks Consensus Estimate for LIN’s current-year earnings has been revised 0.97% upward in the past 60 days. It has a trailing four-quarter earnings surprise of 5.9%, on average. The stock has gained 18.9% over the past year.

PPG Industries currently carries a Zacks Rank #2 and has a projected earnings growth rate of 17.5% for the current year. Shares of PPG have gained 6.2% in the past year. It delivered a trailing four-quarter earnings surprise of 6.8% on average.

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