Mr. Mark Davis reports
PROLONGED CN RAIL STRIKE COULD HAVE MATERIAL NEGATIVE IMPACT ON CHEMTRADE'S OPERATING RESULTS
A prolonged interruption of rail service resulting from the work stoppage at Canadian National Railway Company (CN) that commenced on early Tuesday morning could have a material negative impact on the operating results of Chemtrade Logistics Income Fund. Chemtrade's earnings guidance for 2019, which was updated on Nov. 6, 2019, did not contemplate an interruption to rail service. If the strike does have a material impact it is likely to prevent Chemtrade from meeting its earnings guidance.
Mark Davis, president and chief executive officer of Chemtrade, said: "It's difficult to quantify the impact of an interruption of rail service as it will also affect our suppliers and customers in varying degrees. Our operations and those of our customers and suppliers are heavily dependent on rail service, and a number of our locations across Canada are served by CN. Where possible, we have plans in place to continue to deliver product to our customers. However, alternative supply arrangements are not just costly but are also generally not feasible. If the stoppage continues for more than a few days, the additional costs and lost sales revenue could have a material impact on our operating results."
Logistics Income Fund
Chemtrade operates a diversified business providing industrial chemicals and services to customers in North America and around the world. Chemtrade is one of North America's largest suppliers of sulphuric acid, spent acid processing services, inorganic coagulants for water treatment, sodium chlorate, sodium nitrite, sodium hydrosulphite and phosphorus pentasulphide. Chemtrade is a leading regional supplier of sulphur, chloralkali products, liquid sulphur dioxide, potassium chloride and zinc oxide. Additionally, Chemtrade provides industrial services such as processing byproducts and waste streams.
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