TORONTO -- (Business Wire)
Chemtrade Logistics Income Fund (TSX: CHE.UN) today announced that it has declared a cash distribution of $0.05 per unit for the month of March 2020 payable on April 30, 2020 to unitholders of record at the close of business on March 31, 2020.
Holders of units who are non-residents of Canada will be required to pay all withholding taxes payable in respect of any distributions of income by the Fund.
Chemtrade reviews its distribution policy on an ongoing basis. Chemtrade has paid a monthly distribution of $0.10 per unit since the beginning of 2007. Given the current uncertainty in the global economy and reduced visibility into the future, Chemtrade believes that it is prudent to reduce its monthly distributions by 50%. To date, the current economic conditions have not had a material impact on Chemtrade’s business, nor on the assumptions underpinning Chemtrade’s 2020 earnings guidance, which was issued in January 2020. However, the longer these circumstances persist the higher is the risk to our underlying assumptions.
Mark Davis, President and Chief Executive Officer, said, “While we continue to believe that our distribution is sustainable in normal times; these are not normal times. In times like these, financial prudence is essential. Accordingly, to protect our balance sheet and maintain financial flexibility, we have reduced our monthly distribution to $0.05 per unit. We intend to use excess cash flow to strengthen our balance sheet by reducing leverage. We will continue to evaluate our distribution policy as economic conditions stabilize and as our business performance warrants.”
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 and phosphorus pentasulphide. Chemtrade is a leading regional supplier of sulphur, chlor-alkali products, liquid sulphur dioxide, potassium chloride, sodium hydrosulphite and zinc oxide. Additionally, Chemtrade provides industrial services such as processing by-products and waste streams.
Caution Regarding Forward-Looking Statements
Certain statements contained in this news release constitute forward-looking statements within the meaning of certain securities laws, including the Securities Act (Ontario). Forward-looking statements can be generally identified by the use of words such as “anticipate”, “continue”, “estimate”, “expect”, “expected”, “intend”, “may”, “will”, “project”, “plan”, “should”, “believe” and similar expressions. Specifically, forward-looking statements in this news release include statements respecting certain future expectations about: the sustainability of our distribution rate in normal times; our intention to use excess cash flow to reduce leverage; and our intention to continue to evaluate our distribution rate. Forward-looking statements in this news release describe the expectations of the Fund and its subsidiaries as of the date hereof.
These statements are based on assumptions and involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements for a variety of reasons, including without limitation the risks and uncertainties detailed under the “RISK FACTORS” section of the Fund’s latest Annual Information Form and the “RISKS AND UNCERTAINTIES” section of the Fund’s most recent Management’s Discussion & Analysis.
Although the Fund believes the expectations reflected in these forward-looking statements and the assumptions upon which they are based are reasonable, no assurance can be given that actual results will be consistent with such forward-looking statements, and they should not be unduly relied upon. With respect to the forward-looking statements contained in this news release, the Fund has made assumptions regarding: there being no significant disruptions affecting the operations of the Fund and its subsidiaries, whether due to labour disruptions, supply disruptions, power disruptions, transportation disruptions, damage to equipment or otherwise; the ability of the Fund to obtain products, raw materials, equipment, transportation, services and supplies in a timely manner to carry out its activities and at prices consistent with current levels or in line with the Fund’s expectations; the timely receipt of required regulatory approvals; the cost of regulatory and environmental compliance being consistent with current levels or in line with the Fund’s expectations; the ability of the Fund to successfully access tax losses and tax attributes; the ability of the Fund to obtain financing on acceptable terms; currency, exchange and interest rates being consistent with current levels or in line with the Fund’s expectations; and global economic performance.
Except as required by law, the Fund does not undertake to update or revise any forward-looking statements, whether as a result of new information, future events or for any other reason. The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement.
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President & CEO
Tel: (416) 496-4176
Vice President, Finance & CFO
Tel: (416) 496-4177
Source: Chemtrade Logistics Income Fund
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