Selected Financial Information

2018 Full Year Financial Information

Click here to view 2018 full-year earnings.

Highlights

During the first quarter of 2019, we generated profit of $59 million compared to a loss of $555 million for the first quarter of 2018. The quarter-over-quarter increase in profit 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 quarter of 2019.

On January 16, 2019, we joined The Alliance to End Plastic Waste as a founding member. The Alliance is a not-for-profit organization composed of global companies across the entire plastics value chain to advance solutions to reduce plastic waste in the environment. The nearly 30 companies are making a combined initial commitment of $1 billion, with a goal of $1.5 billion over the next five years.

On February 28, 2019, Bayport Polymers LLC ("BAYSTAR® Polymers"), the joint venture that is owned 50% by Total S.A. and 50% by Novealis Holdings LLC ("Novealis"), held its official groundbreaking ceremony for the construction of a new 1.35 billion pound per year Borstar® polyethylene unit at its production site in Pasadena, Texas, with an anticipated start-up of 2021. Novealis is a joint venture that is 50% owned by Borealis AG and 50% owned by NOVA Chemicals. As of January 1, 2019, we assumed most sales and marketing functions in the Americas for BAYSTAR Polymers' existing 880 million pound per year polyethylene facility in Bayport, Texas.

Capital spending increased by 58% due to spending on expansion of our Corunna cracker by approximately 50 percent and a new Advanced SCLAIRTECHTM technology facility that is designed to 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 revolving credit facilities, less utilization (including letters of credit), plus cash and cash equivalents. Our total liquidity at March 31, 2019, was $2,813 million, compared to $2,885 million at December 31, 2018.

In December 2018, we amended and restated our senior secured credit agreement provided by a syndicate of lenders to, among other things, (i) increase the availability of the revolving credit facility from $1,200 million to $1,500 million, (ii) establish a new 5- year $500 million term loan facility that may be drawn in a single draw down within 181 days of December 3, 2018, (iii) increase the maximum debt to capitalization financial covenant from 62.5% to 65.0% and (iv) extend the maturity date of the senior secured revolving credit facility one year to December 3, 2023. As of March 31, 2019 and December 31, 2018, we had utilized $45 million.

We have two accounts receivable securitization programs (one in the U.S. and one in Canada). At March 31, 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. As of March 31, 2019, the programs were undrawn. The receivables base, at March 31, 2019, would have allowed us to draw approximately 73% 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 March 31, 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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