Selected Financial Information

2017 Full Year Financial Information

Highlights

For the first half of 2018, we generated a loss of $389 million, compared to a loss of $84 million for the first half of 2017. The decrease in profit in the first half of 2018 compared to the first half of 2017 was due to the legal provision that we recorded in the first quarter of 2018, somewhat offset by higher polyethylene sales volume in the first half of 2018 and the legal provision that we recorded in the first quarter of 2017. Excluding the $727 million (net of tax) and $369 million (net of tax) legal provisions that we recorded in the first half of 2018 and 2017, respectively, our profit would have been $53 million higher in the first half of 2018 compared to the first half of 2017.

On May 23, 2018, we entered into a joint venture with affiliates of Borealis AG ("Borealis") and Total S.A. ("Total"), at which time we contributed $180 million. The joint venture, named Bayport Polymers LLC is owned 50% by Total and 50% by Novealis Holdings LLC. The joint venture includes (i) the under-construction 2.2 billion pound per year ethane steam cracker in Port Arthur, Texas, (ii) Total’s former 880 million pound per year polyethylene facility in Bayport, Texas, and (iii) a new 1.35 billion pound per year Borstar® polyethylene unit at Total’s Bayport, Texas, site, subject to final investment decision. Novealis Holdings LLC is a joint venture 50% owned by Borealis and 50% owned by NOVA Chemicals.

Capital spending in the first half of 2018 compared to the first half of 2017 decreased by 22%, primarily due to the purchase of two pipelines, the Ethylene Delivery System and Joffre Feedstock Pipeline, from AltaGas Extraction and Transmission L.P., on March 15, 2017.


Liquidity and Credit Facilities

We define liquidity as total available capacity under revolving credit facilities, less utilization (including letters of credit), plus cash and cash equivalents. Our total liquidity at June 30, 2018, was $1,750 million, compared to $1,545 million at December 31, 2017.

We have a $1,200 million senior secured revolving credit facility provided by a syndicate of lenders, which has a maturity date of December 16, 2022. As of June 30, 2018 and December 31, 2017, we had utilized $71 million.

We have two accounts receivable securitization programs (one in the U.S. and one in Canada). At June 30, 2018 and December 31, 2017, the combined maximum funding availability of the programs was $175 million and $225 million, respectively. In March 2018, we amended our Canadian accounts receivable securitization program to extend the term two years until February 11, 2020 and decrease the program's maximum funding from $100 million to $50 million. Our U.S. accounts receivable securitization program allows for maximum funding of $125 million and has a term that expires on January 30, 2020. As of June 30, 2018, the programs were undrawn. The receivables base, at this date, would have allowed us to draw approximately 96% of the maximum funding availability.

Our $1,200 million secured revolving credit facility and our accounts receivable securitization programs are governed by financial covenants which require quarterly compliance. The covenants require a maximum senior debt-to-cash flow ratio of 3:1 computed on a rolling 12 month basis and a debt to capitalization ratio not to exceed 62.5%. We were in compliance with these covenants at June 30, 2018.

As of June 30, 2018 and December 31, 2017, we had $24 million outstanding on our standby letter of credit facility and our cash secured letter of credit facility was undrawn.

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NOVA Chemicals Corporation (the “Company”) no longer makes its financial statements available to the general public. However, (1) holders of notes of the Company, (2) bona fide prospective investors who are either qualified institutional buyers or are non-US persons, (3) securities analysts, or (4) market makers in Company notes, can access Company information through the Company’s password-protected online data system. If you are included in any one of the above categories and wish to view Company information, please contact Carolyn Rose per the contact information provided below. Prior to providing log-in details, Ms. Rose may require proof that you fall within one of the above categories and are entitled to access to the data site.
 

Carolyn Rose
Senior Corporate Paralegal
E-mail: bondholder@novachem.com

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