/EINPresswire.com/ -- VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 07/27/16 -- For the second quarter of 2016, Methanex (TSX: MX)(NASDAQ: MEOH) reported net loss attributable to Methanex shareholders of $3 million compared to a net loss of $23 million in the first quarter of 2016. Adjusted EBITDA for the second quarter of 2016 was $38 million and Adjusted net loss was $31 million ($0.34 Adjusted net loss per common share). This compares with Adjusted EBITDA of $36 million and Adjusted net loss of $24 million ($0.27 Adjusted net loss per common share) for the first quarter of 2016.

John Floren, President and CEO of Methanex commented, "Our second quarter earnings reflect the impact of lower average realized methanol pricing offset by higher sales of produced product compared to the first quarter. Our operational performance in the second quarter of 2016 was excellent. We increased our production by 8% versus the first quarter, to a total of 1,770,000 tonnes, which is a new company record. Our total sales volume increased by 11% to 2,362,000 tonnes in the second quarter, and was also a company record."

John Floren continued, "Global demand growth rebounded in the second quarter, and remains healthy at an estimated year-over-year growth rate of 8%. MTO demand growth was strong in the quarter, as MTO facilities ran at higher operating rates helped by improving margins, and one new MTO facility began full operation. We also saw good traditional chemical demand following the seasonal slow period during the Chinese New Year holiday. Growth continued to be led by Asia and was stable in the Americas and Europe."

Mr. Floren concluded, "During the quarter, we reached a settlement with Petrobras Argentina S.A. ("Petrobras") for $32.5 million ($21 million net of tax) to terminate Petrobras' natural gas delivery obligations pursuant to a long-term natural gas supply agreement in Chile. During the quarter, we paid a $25 million dividend to shareholders. With $239 million of cash on hand, an undrawn credit facility and a robust balance sheet, we are well positioned to meet our financial and capital commitments and steer through this period of lower methanol pricing. With record production volume, we are well positioned to benefit from a recovery from the bottom of the cycle methanol pricing and generate strong future cash flows."

FURTHER INFORMATION

The information set forth in this news release summarizes Methanex's key financial and operational data for the second quarter of 2016. It is not a complete source of information for readers who are unfamiliar with Methanex Corporation ("the Company") and is not in any way a substitute for reading the second quarter 2016 Management's Discussion and Analysis ("MD&A") dated July 27, 2016 and the condensed consolidated interim financial statements for the period ended June 30, 2016, both of which are available from the Investor Relations section of our website at www.methanex.com. The MD&A and the condensed consolidated interim financial statements for the period ended June 30, 2016 are also available on the Canadian Securities Administrators' SEDAR website at www.sedar.com and on the United States Securities and Exchange Commission's EDGAR website at www.sec.gov.

FINANCIAL AND OPERATIONAL DATA

                                        Three Months Ended  Six Months Ended
                                --------------------------------------------
($ millions except per share      Jun 30   Mar 31   Jun 30   Jun 30   Jun 30
 amounts and where noted)           2016     2016     2015     2016     2015
----------------------------------------------------------------------------
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Production (thousands of tonnes)
 (attributable to Methanex
 shareholders)                     1,770    1,639    1,281    3,409    2,545
Sales volume (thousands of
 tonnes)
  Methanex-produced methanol
   (attributable to Methanex
   shareholders)                   1,689    1,529    1,203    3,218    2,440
  Purchased methanol                 533      422      813      955    1,465
  Commission sales                   140      168      109      308      294
----------------------------------------------------------------------------
  Total sales volume (1)           2,362    2,119    2,125    4,481    4,199

Methanex average non-discounted
 posted price ($ per tonne) (2)      260      272      403      266      393
Average realized price ($ per
 tonne) (3)                          223      230      350      227      344

Revenue                              468      435      638      903    1,215
Adjusted revenue                     496      450      696      946    1,321
Adjusted EBITDA                       38       36      129       74      226
Cash flows from operating
 activities                           34       70       82      104      119
Adjusted net income (loss)           (31)     (24)      51      (55)      72
Net income (loss) (attributable
 to Methanex shareholders)            (3)     (23)     104      (26)     113

Adjusted net income (loss) per
 common share                      (0.34)   (0.27)    0.56    (0.62)    0.79
Basic net income (loss) per
 common share                      (0.03)   (0.26)    1.15    (0.29)    1.24
Diluted net income (loss) per
 common share                      (0.08)   (0.26)    1.15    (0.34)    1.23

Common share information
 (millions of shares)
  Weighted average number of
   common shares                      90       90       91       90       91
  Diluted weighted average
   number of common shares            90       90       91       90       92
  Number of common shares
   outstanding, end of period         90       90       90       90       90
----------------------------------------------------------------------------

(1)  Total sales volume includes any volume produced by Chile using natural
     gas supplied from Argentina under a tolling arrangement ("Tolling
     Volume"). Tolling Volume was nil for the three and six months ended
     June 30, 2016 compared to 28,000 tonnes and 68,000 tonnes for the same
     periods in 2015. Commission sales represent volume marketed on a
     commission basis related to the 36.9% of the Atlas methanol facility
     and 50% of the Egypt methanol facility that we do not own.
(2)  Methanex average non-discounted posted price represents the average of
     our non-discounted posted prices in North America, Europe and Asia
     Pacific weighted by sales volume. Current and historical pricing
     information is available at www.methanex.com.
(3)  Average realized price is calculated as revenue, excluding commissions
     earned and the Egypt non-controlling interest share of revenue, but
     including an amount representing our share of Atlas revenue, divided by
     the total sales volume of Methanex-produced (attributable to Methanex
     shareholders) and purchased methanol, but excluding Tolling Volume.

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

                                      Three Months Ended   Six Months Ended
                              ----------------------------------------------
($ millions except number of    Jun 30   Mar 31   Jun 30    Jun 30   Jun 30
 shares and per share amounts)    2016     2016     2015      2016     2015
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Net income (loss)
 (attributable to Methanex
 shareholders)                 $    (3) $   (23) $   104   $   (26) $   113
Mark-to-market impact of
 share-based compensation, net
 of tax                             (7)      (1)       4        (8)      16
Argentina gas settlement, net
 of tax                            (21)       -        -       (21)       -
Gain related to the
 termination of a terminal
 services agreement, net of
 tax                                 -        -      (57)        -      (57)
----------------------------------------------------------------------------
Adjusted net income (loss)     $   (31) $   (24) $    51   $   (55) $    72
----------------------------------------------------------------------------
Diluted weighted average
 shares outstanding (millions)      90       90       91        90       92
Adjusted net income (loss) per
 common share                  $ (0.34) $ (0.27) $  0.56   $ (0.62) $  0.79
----------------------------------------------------------------------------

--  We recorded a net loss attributable to Methanex shareholders of $3
    million during the second quarter of 2016, compared to a net loss of $23
    million in the first quarter of 2016. The change is attributable to
    higher sales of methanol which was partially offset by a decrease in our
    average realized price to $223 per tonne for the second quarter of 2016
    from $230 per tonne for the first quarter of 2016. We also reached a
    settlement with Petrobras Argentina S.A. ("Petrobras") for $32.5 million
    ($21 million, net of tax) during the second quarter of 2016 to terminate
    Petrobras' natural gas delivery obligations pursuant to a long-term
    natural gas supply agreement in Chile.

--  We recorded Adjusted EBITDA of $38 million for the second quarter of
    2016 compared with $36 million for the first quarter of 2016. The
    increase in Adjusted EBITDA was primarily due to higher sales volume
    which was partially offset by a decrease in our average realized price.

--  Sales of Methanex-produced methanol were a record 1,689,000 tonnes in
    the second quarter of 2016 compared with 1,529,000 in the first quarter
    of 2016.

--  Cash flows from operating activities in the second quarter of 2016 were
    $34 million compared with $70 million for the first quarter of 2016 and
    $82 million for the second quarter of 2015. Cash flows in the second
    quarter of 2016 were impacted by an increase in working capital as a
    result of higher sales volume and inventory build.

--  Our planned capital maintenance expenditure program directed towards
    maintenance, turnarounds and catalyst changes for existing operations,
    including our 63.1% share of Atlas, is currently estimated to be $25
    million for the remainder of 2016.

--  During the second quarter of 2016 we paid a $0.275 per common share
    dividend to shareholders for a total of $25 million.

PRODUCTION HIGHLIGHTS

                                               Q2 2016               Q1 2016
                                         Operating
(thousands of tonnes)                  Capacity(1)   Production   Production
----------------------------------------------------------------------------
----------------------------------------------------------------------------
New Zealand (2)                                608          577          509
Geismar 1 and 2 (Louisiana, USA) (3)           500          527          483
Atlas (Trinidad) (63.1% interest)              281          236          109
Titan (Trinidad)                               218          181          204
Egypt (50% interest)                           158           53           75
Medicine Hat (Canada)                          150          123          159
Chile I and IV (4)                             100           73          100
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                                             2,015        1,770        1,639
----------------------------------------------------------------------------

                                           Q2 2015  YTD Q2 2016  YTD Q2 2015
(thousands of tonnes)                   Production   Production   Production
----------------------------------------------------------------------------
----------------------------------------------------------------------------
New Zealand (2)                                487        1,086          968
Geismar 1 and 2 (Louisiana, USA) (3)           276        1,010          456
Atlas (Trinidad) (63.1% interest)              236          345          445
Titan (Trinidad)                               183          385          369
Egypt (50% interest)                             8          128           16
Medicine Hat (Canada)                           51          282          178
Chile I and IV (4)                              40          173          113
----------------------------------------------------------------------------
                                             1,281        3,409        2,545
----------------------------------------------------------------------------

(1)  Operating capacity includes only those facilities which are currently
     capable of operating, but excludes any portion of an asset that is
     underutilized due to a lack of natural gas feedstock over a prolonged
     period of time. Our current annual operating capacity is 8.1 million
     tonnes, including 0.4 million tonnes related to our Chile operations.
     The operating capacity of our production facilities may be higher than
     original nameplate capacity as, over time, these figures have been
     adjusted to reflect ongoing operating efficiencies at these facilities.
     Actual production for a facility in any given year may be higher or
     lower than operating capacity due to a number of factors, including
     natural gas composition or the age of the facility's catalyst.
(2)  The operating capacity of New Zealand is made up of the two Motunui
     facilities and the Waitara Valley facility.
(3)  We commenced methanol production from Geismar 1 during the first
     quarter of 2015 and from Geismar 2 late in the fourth quarter of 2015.
     Each facility has an annual operating capacity of 1.0 million tonnes.
(4)  The production capacity of our Chile I and IV facilities is 1.7 million
     tonnes annually assuming access to economical natural gas feedstock.

Production for the second quarter of 2016 was a record 1,770,000 tonnes compared with 1,639,000 tonnes for the first quarter of 2016. The higher production in the second quarter reflects strong production at the company's New Zealand and Geismar facilities, and the return to operation of the Atlas facility after a 45-day maintenance turnaround in the first quarter. Key production and operational highlights include:

--  Strong production from New Zealand, where close to full operating
    capacity was achieved.

--  Geismar production rates were strong, reflecting, in part, the
    relatively new catalyst at these plants.

--  Combined operating rate of 84% in Trinidad, reflecting the return to
    normal operation of the Atlas plant.

--  Egypt production of 53,000 tonnes (Methanex share) reflecting higher
    than expected natural gas supply in Egypt. The plant was restarted in
    early May after a shutdown in early March due to natural gas supply
    restrictions and has since operated at reduced rates on an intermittent
    basis as gas has become available. Based on the best information we have
    available, we expect that the plant may be required to shut down
    intermittently during the remaining summer months when electricity
    demand is at its peak.

--  Medicine Hat production of 123,000 tonnes or 82% of capacity, reflecting
    a mechanical issue at the plant that resulted in lost production of
    approximately 40,000 tonnes during the quarter.

--  Chile production of 73,000 tonnes, reflecting continued operation of the
    Chile I facility through the second quarter at reduced rates, 100%
    supported by natural gas supplies from Chile. The plant was shut down at
    the beginning of July for planned maintenance and is expected to restart
    in August. Based on our current view of gas availability in Chile, we
    believe that there is sufficient gas for us to continue to operate
    through the remainder of the southern hemisphere winter at reduced
    rates.

CONFERENCE CALL

A conference call is scheduled for July 28, 2016 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) 340-8530, or toll free at (800) 769-8320. Presentation slides summarizing the Q2 2016 results and a simultaneous audio-only webcast of the conference call can be accessed from our website at www.methanex.com. A playback version of the conference call will be available until August 18, 2016 at (905) 694-9451, or toll free at (800) 408-3053. The passcode for the playback version is 5792019. The webcast will be available on the website for three weeks following the call.

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".

FORWARD-LOOKING INFORMATION WARNING

This second quarter 2016 press release contains forward-looking statements with respect to us and the chemical industry. By its nature, forward-looking information is subject to numerous risks and uncertainties, some of which are beyond the Company's control. Readers are cautioned that undue reliance should not be placed on forward-looking information as actual results may vary materially from the forward-looking information. Methanex does not undertake to update, correct or revise any forward-looking information as a result of any new information, future events or otherwise, except as may be required by applicable law. Refer to Forward-Looking Information Warning in the second quarter 2016 Management's Discussion and Analysis for more information which is available from the Investor Relations section of our website at www.methanex.com, the Canadian Securities Administrators' SEDAR website at www.sedar.com and on the United States Securities and Exchange Commission's EDGAR website at www.sec.gov.

NON-GAAP MEASURES

The Company has used the terms Adjusted EBITDA, Adjusted net income, Adjusted net income per common share, Adjusted revenue and operating income throughout this document. These items are non-GAAP measures that do not have any standardized meaning prescribed by GAAP. These measures represent the amounts that are attributable to Methanex Corporation shareholders and are calculated by excluding the mark-to-market impact of share-based compensation as a result of changes in our share price and the impact of certain items associated with specific identified events. Refer to Additional Information - Supplemental Non-GAAP measures on page 12 of the Company's MD&A for the three and six months ended June 30, 2016 for reconciliations to the most comparable GAAP measures. Unless otherwise indicated, the financial information presented in this release is prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB").

Contacts:
Sandra Daycock
Director, Investor Relations
Methanex Corporation
604-661-2600
www.methanex.com

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