Selected Financial Information

2018 Full Year Financial Information

Highlights

While we continue to have strong production and sales, overall the industry is not performing as well as expected a year ago due to slowing growth prospects across much of the globe and rising trade tensions.

For the first half of 2019, we generated profit of $160 million, compared to a loss of $389 million for the first half of 2018. The increase in profit in the first half of 2019 compared to the first half of 2018 was due to the legal provision of $727 million (net of tax) that we recorded in the first quarter of 2018, somewhat offset by lower selling prices for polyethylene and ethylene in the first half of 2019.

On July 10, 2019, we published our 2018 Sustainability Report which outlines our long-term vision for sustainability. The report shares our direction for sustainability as well as our roles as a sustainability collaborator and global citizen.

Capital spending increased by 61% due to spending on the expansion of our Corunna cracker by approximately 50 percent and a new Advanced SCLAIRTECHTM technology facility that will increase NOVA Chemicals' polyethylene production capacity by approximately 950 million pounds per year. Construction is currently underway for both projects, with start-up targeted for late 2021.


Liquidity and Credit Facilities

We define liquidity as total available capacity under our senior secured credit agreement, less utilization (including letters of credit), plus cash and cash equivalents. Our total liquidity at June 30, 2019, was $2,754 million, compared to $2,885 million at December 31, 2018.

We have a senior secured credit agreement provided by a syndicate of lenders. The senior secured credit agreement includes a $1,500 million revolving credit facility, which has a maturity date of December 3, 2023, and a 5-year $500 million term loan facility which may be drawn in a single draw down within nine months of December 3, 2018. We amended the senior secured credit agreement in May 2019 to extend the availability period of the $500 million term loan facility from within six months to within nine months of December 3, 2018. The senior secured term loan facility was undrawn as of June 30, 2019 and December 31, 2018. As of June 30, 2019 and December 31, 2018, we utilized $45 million on our revolving credit facility.

We have two accounts receivable securitization programs (one in the U.S. and one in Canada). At June 30, 2019 and December 31, 2018, the combined maximum funding availability of the programs was $175 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. Our Canadian accounts receivable securitization program allows for maximum funding of $50 million and has a term that expires on February 11, 2020. At June 30, 2019 and December 31, 2018, the programs were undrawn. The receivables base, at June 30, 2019, would have allowed us to draw approximately 68% of the maximum funding availability.

Our senior secured credit agreement, which includes a revolving credit facility and a term loan 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 65%. We were in compliance with these covenants at June 30, 2019.

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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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