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Sunday August 18th, 2019 11:54PM

Ciner Resources LP Announces Fourth Quarter and Year Ended 2017 Financial Results

By The Associated Press

ATLANTA--(BUSINESS WIRE)--Feb 15, 2018--Ciner Resources LP (NYSE: CINR) today reported its financial and operating results for the fourth quarter and year ended December 31, 2017.

Fourth Quarter and Year Ended 2017 Financial Highlights:

Kirk Milling, CEO, commented: “Record production levels along with higher than anticipated international prices in the quarter drove an improvement in adjusted EBITDA of 21.6% and net income of 33.3% compared to Q4 of 2016. The quarter was the first true sign that the production initiatives we undertook earlier in the year to improve reliability and increase utilization of our production units are beginning to take hold. Ultimately the quarter pushed our full year results more in line with expectations as EBITDA rose 2.6% and distributable cash flow rose just over 3% compared to 2016.”

“As we look forward into 2018, we expect higher production levels and share gains in the domestic market to soften any potential impact we may experience from lower international pricing. As we begin the year, the market looks better than previously anticipated due to continued strength in Asia and a smaller impact on pricing thus far from the new capacity coming on line in Turkey.”

2018 Outlook:

** Excluding the change related to freight from CIDT sales in 2017.

Three Months Ended December 31, 2017 compared to Three Months Ended December 31, 2016

The following table sets forth a summary of net sales, sales volumes and average sales price, and the percentage change between the periods.

Consolidated Results

Net sales. Net sales increased by 4.4% to $128.5 million for the three months ended December 31, 2017 from $123.1 million for the three months ended December 31, 2016, driven by an increase in total average sales price of 3.7%, as well as a modest increase in soda ash volumes sold of 0.6%. The increased international average sales price reflects the higher ANSAC sales price during the three months ended December 31, 2017.

Cost of products sold, including freight costs. Cost of products sold, including freight costs, depreciation, depletion and amortization expense, decreased by 1.6% to $95.2 million for the three months ended December 31, 2017 from $96.7 million for the three months ended December 31, 2016, primarily due to lower deca rehydration (“DECA”) costs per ton as we harvested DECA from a pond with closer proximity to the plant for 2017 and lower employee benefit costs, primarily resulting from changes to postretirement benefits during 2017, partially offset by an increase in freight costs during the three months ended December 31, 2017.

Selling, general and administrative expenses. Our selling, general and administrative expenses increased 13.7% to $5.8 million for the three months ended December 31, 2017, compared to $5.1 million for the three months ended December 31, 2016. The increase over prior year was primarily driven by a decline in the proportion of employee time spent on Ciner Corp related activities and increased share-based compensation during 2017, offset by certain European restructuring charges present during the three months ended December 31, 2016 that did not occur during 2017 and higher selling and administrative fees relating to our affiliate, ANSAC during three months ended December 31, 2017.

Year Ended December 31, 2017 compared to Year Ended December 31, 2016

The following table sets forth a summary of net sales, sales volumes and average sales price, and the percentage change between the periods.

Consolidated Results

Net sales. Net sales increased by 4.7% to $497.3 million for the twelve months ended December 31, 2017 from $475.2 million for the twelve months ended December 31, 2016, driven by increase in total average sales price of 5.8%, partially offset by an annual decrease in soda ash volumes sold of 1.1%. The increased international average sales price reflects the increase in freight costs driven by higher non-ANSAC export sales volume, primarily CIDT. The decrease in sales volumes are primarily due to lower production output compared to the prior year.

Cost of products sold, including freight costs. Cost of products sold, including freight costs, depreciation, depletion and amortization expense, increased by 6.1% to $383.8 million for the twelve months ended December 31, 2017 from $361.7 million for the twelve months ended December 31, 2016, primarily due to an increase in freight costs of 21.8% to $145.7 million for the twelve months ended December 31, 2017, compared to $119.6 million for the twelve months ended December 31, 2016. The increase in freight costs was driven by higher non-ANSAC export sales volumes, primarily CIDT. The higher incremental freight costs on non-ANSAC export sales is also reflected in the higher average international sales price. In the twelve months ended December 31, 2016, international sales primarily consisted of transactions to ANSAC. During the twelve months ended December 31, 2017, we also had higher maintenance expense that was partially offset by lower employee benefit costs, primarily resulting from changes to postretirement benefits.

Selling, general and administrative expenses. Our selling, general and administrative expenses decreased 3.9% to $22.4 million for the twelve months ended December 31, 2017, compared to $23.3 million for the twelve months ended December 31, 2016. The decrease was primarily driven by lower selling and administrative fees relating to our affiliate, ANSAC, and a higher proportion of employee time spent on Ciner Corp related activities in 2017.

Impairment and loss on disposal of assets, net. During the twelve months ended December 31, 2017, we incurred a $1.6 million asset impairment charge relating to certain assets, which became obsolete as a result of energy sourcing initiatives at our Wyoming facility.

CAPEX AND ORE TO ASH RATIO

The following table below summarizes our capital expenditures, on an accrual basis, and ore to ash ratio:

FINANCIAL POSITION AND LIQUIDITY

As of December 31, 2017, we had cash and cash equivalents of $30.2 million. In addition, we have approximately $75.4 million ($225.0 million, less $138.0 million outstanding and less standby letters of credit of $11.6 million) of remaining capacity under our revolving credit facilities. As of December 31, 2017, our leverage and interest coverage ratios, as calculated per the Ciner Wyoming Credit Facility, were 1.21 and 27.38, respectively.

CASH FLOWS AND QUARTERLY CASH DISTRIBUTION

Cash Flows

Cash provided by operating activities decreased to $79.3 million during the twelve months ended December 31, 2017 compared to $128.3 million of cash provided during twelve months ended December 31, 2016, primarily driven by $37.8 million of working capital used in operating activities during the twelve months ended December 31, 2017, compared to $14.2 million of working capital provided by operating activities during the twelve months ended December 31, 2016. The $52.0 million increase in working capital used in operating activities was primarily due to the $37.7 million increase in due-from affiliates.

This article has been truncated. You can see the rest of this article by visiting http://www.businesswire.com/news/home/20180215006184/en.

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