LXU - Earnings call transcript Q1 2024

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Operator

Hello and welcome to the LSB Industries First Quarter 2024 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded.It's now my pleasure to turn the call over to Fred Buonocore, Vice President, Investor Relations. Fred, please go ahead.

Fredric Buonocore

Good morning, everyone.

Joining me today are Mark Behrman, our Chief Executive Officer; and Cheryl Maguire, our Chief Financial Officer. is our today Commercial us joining Damien Chief Renwick, Officer. Also forward-looking that today's note statements. call Please includes These statements on are based and intent, projections. expectations, the company's current variety the not factors will materially.On reference are guarantees future we and They results. of the call, could results actual a cause non-GAAP to differ performance of the press GAAP reconciliations our of results section to website, forward-looking lsbindustries.com, see the Investors regarding and Please for statements results. release in of further information non-GAAP

attributes. this tax see As lsbindustries.com ahead Plan like over we to call section a our the to to the have Rights of certain reminder, Investors Stockholder for a protect further time, go Please website at Mark. turn important and details.At I'd

Mark Behrman

Fred. you, Thank

presentation. X to our of Turning Page

but and First stronger somewhat were quarter with natural lower our results line was year-over-year, sales this by in volumes down costs. expectations. gas offset was Pricing

We first the to to flow continued quarter cash free our and our stock, generate to position cash strong capital returning repurchase our in positive shareholders. used

notes further our debt We balance the derisking during by also sheet. our reduced repurchasing quarter,

to continue quarter and further notes to opportunities efforts. our selectively of stock first those seek will both and post the repurchase We

dynamics Commercial Lastly, discussed who provide track pleased in that low-carbon timelines with and pricing remain Officer, the we the call Damien? the and turn market on to trends. Renwick, projects these on Chief the will ammonia Damien initiatives, our I'll later on our more the I'm color March, in back X call.Now current to over discuss

Damien Renwick

at XXXX-'XX translate price income end market. X to of the corn stock agricultural some corn estimates an for our key reduced prices coming see the with including for price exceeds bushel. grains, Thanks, remain support. for recently The December expectations presentation, increasing overview currently supply good Mark, you providing in Despite per $X.XX today. I'm corn, farmers. global 'XX USDA futures U.S. months, and of levels levels On into Page everyone. speak morning, should glad our healthy that Corn you'll

the support the sale during remain of XX% the gasoline, ethanol addition, believe for or for in of season prices. robust harvest.Ammonia with summer, past application planting been corn several to the fall have motivated prices recently that demand again season the through will a by after strong In and yields EPA underpinned We extended over further fertilizers U.S. the corn nitrogen spring in balance the of the application EXX, provide maximize the should which months the farmers pre-plant

of variety the includes this production domestic gas a of Trinidad. We expected saw online of impacting of supply. events supply was number cold and year, production, also the global shipping a disruption weather-related U.S. the that constraining new through to issues in early Suez come This in capacity the ammonia Canal, startup natural factors delayed

to has previous import continued pace a successfully dynamic strategy. negative continued prices. global through was as improved on historically We prices due to also develop we This Chinese below as of impact UAN of the had saw a volatile exports, in to our us of QX quarter expectations a the that direct-to-customer urea marketing where target supply limited, UAN were resumption pockets years.Urea allowed pricing execute demand

the into However, supply the additional global restrictions implemented infusion the on of government urea exports, Chinese delaying recently market. further

attention don't UAN our to dynamics, pricing sell HDAN for we pay and we do urea, urea can pricing close While impact its since pricing products.

book through to and and season, demand products across our remainder order well-positioned support the on the June. forward is As of early through our pricing perspectives market our we May look fertilizer

the Henry years, Middle resilience we that benchmark over trend for and chart following to cost dynamics a at of has upper X warm price U.S. business. representing play and with in shows the QX in the summarizes take indicates.Page have the A foams, U.S. price in agricultural gas to TTF, instability imports. the of is forward balance last key we industrial our on chart manufacturing. The forecasts to We show the XXXX our some European the amount U.S. steady prices in winter competitive price trends product.On to the a drive advantage heavy is good persist sales relative Still, LNG in natural of a price used for remain economy. auto commodities and the advantage of sell depending producers. advantage the orders increased demand a remains business, Europe, those end the believe for U.S. Polyurethane, have the room of seen make the as application We fraction benchmark, X, left-hand of used as through pricing through input spot acid Hub, to furniture East period Overall, and major gas pricing. for Page coming prices pricing the month gas some the offset and natural produce the European industrial significant key through gas in decrease the U.S. both the mining reflecting to our will significant of the polyurethane. markets. end nitric

closely such, to furniture production U.S. orders. we data auto and related As track

trends generally that The on charts year in of our the nitric reflect level first in stable experienced acid solid right-hand sales. the remaining we trends over side demand past X manufacturing. charts U.S. these auto on and The the production depicted furniture show X

steep As over the in past the in the mining on year. The the to third production of decline volumes, a years. remained indicates, drop reduction recent chart is past coal largely in coal relatively in the over shown several activity due Slide in activity chart reflected price stable also the X production

minimal the exposure our so impact on coal to We little business. this have weakness market, very had

up for are significantly nitrate, which is demand we've recent strong mining of demand other gold metals for the and in applications. year. part trends On in production this for in metals both experienced ammonium contrary, healthy vehicle electric strong by driven copper, reflected support price activity and of The

results producers and stable our quarter we expect for at and sides for discuss As outlook. Cheryl? nitrogen financial remain future.Now to attractive foreseeable the our to over call of turn both the look our fundamentals I'll to business, we first Cheryl

Cheryl Maguire

sheet and good Damien, EBITDA quarter to the $XX $X.XX provides quarter. adjusted costs.Page a see in offset a million. volumes relative again cash our of XXXX The first metrics. flow X first change by Weaker EBITDA $XX to X summary our generated EPS year once year-over-year partially selling balance sales of $XX our our Page factor you'll the prior in for financial the pricing summary the XX natural prices weaker first bridges million was Thanks, of of EBITDA. quarter gas EBITDA stronger were Page On lower of results. and and adjusted of primary XXXX We adjusted million and key morning.

an repurchased debt. position cash balance In continue $XX derisk use the We of strong notes, opportunity sheet. to and first quarter, million we year-to-date, to our our of our further million we've repurchased as $XX

We also and approximately repurchased stock shares during quarter of our XXX,XXX the shares first million approximately year-to-date. X.X

to repurchase progresses opportunistically their invest the to to We continuing as assets improve in year while performance. our stock expect

$XXX sits per second our As turnarounds $XXX a this Pryor quarter reminder, UAN year. our reliability the currently and forward, ton Tampa the we and half is integral have efficiency.Looking ton. per be during metric plant turnarounds scheduled These NOLA second to at XXXX, of improve ammonia goal to facilities currently and will around at of Cherokee

the the in seasonal given into pricing and We the second the in closes. sequential expect ammonia for normal sales season strong the we decline ammonia run as planting we the first our products quarter both some of volumes, More pricing as expect move in ammonia part our slowdown specifically, in realized a weakening spring for quarter. latter spring

Additionally, fertilizers, which from application, typically typically such to as application UAN, quarter ammonia are the applied marks usually transition post-planting. other the prior second away done which of the to planting, fertilizer is

we $X.XX realized to year-over-year.Furthermore, Pryor we result, a of higher do costs, gas turnarounds As and sales last the year's respect expect the up inclusive both of offset be we in transportation. half lower UAN quarter, compared sequentially expect for Cherokee ramping volumes, our largely fertilizer quarter, are which planned that second preparation per to second costs, be we lower selling expect approximately natural anticipate our for XXXX. impact With MMBtu to we although by and second will prices

expect incur million during of adjusted lower together, prep of EBITDA be to Putting $X than million realized it the quarter approximately to XXXX, second expenses to work second all related $X lower to second selling this quarter. We the we quarter to expect prices. due primarily our

result However, we adjusted and sequential meaningful quarter XXXX gas higher over in a of as volumes sales lower the costs. a expect natural first EBITDA increase

it back second second year this in year-over-year of quarters to pricing prices, quarters more of Mark. in after selling the beyond the be Looking I'll we X product now year.And turn consecutive half expect line with prior quarter, to during over declines

Mark Behrman

that and XXX,XXX to our the XX we enable with that relating EPA. approval construction permanently Cheryl. than low-carbon factor El March. with gating capturing you, will we to Page more the metric Class main project and facility. information track the application approval and remains Class X our projects Receiving COX begin at Dorado. sequestering remains currently Thank underway. in have summarizes This XX we pertain our Pages timeline XX at on early the ammonia Energy discussed El key Dorado Lapis the of The per of permit the VI year then tons from commence Lapis VI produce to project

the EPA of about recent application. to the We've indicating the previous that for regular could at the expectations encouraged in the We our approval feedback to XXXX. are be been by contact timeline permit mid-XXXX relative accelerated with end

since own will producing yield annually. the of us. tons same COX Lapis As $XX million LSB. Collectively, a receive ammonia in expect credit XXQ time, from incremental EBITDA we reminder, expect for of be At we low-carbon this but million will sequestered $XX the annual XXX,XXX capture the more to of they tax tonne buy per than $XX will the facility, approximately COX to to we they

very actively the have As be our key aspects commercial products date our will quarter, last Channel conversations markets indicated team low-carbon ammonia producing project. of the for is El productive.Page to pursuing summarizes our low-carbon XX we and Dorado, been Ship at that Houston we

in entails the of that reminder, produce pre-FEED ammonia of performing is final second year. design a tons million this of during of Samsung at and third Engineering decision is will quarter our the to world-scale anticipate half metric and expected FEED project X.X a next We low-carbon construction plant begin. that expect approximately a investment point be As the we the completed ammonia. year, to which

work with take anticipated recent our many months. markets continue come Asia, and positive JERA, plants, the we to the Europe, power groundbreaking as with offtake, coal-burning expect we for secure trial a eventually terms the of U.S.The the potential this offtake ammonia long-term trial continue to using in to with to co-fire on success underway one its Japan's dramatically its power low-carbon X-month in to company, has emissions. ammonia The generation. long-term shape, largest emerging customers ammonia viability in offtakers a from Based conversations, production. ammonia for of COX be developments Regarding its ongoing providing would plants XXX% ammonia goal XX% for of use large-scale means of of of using reducing power

regard, producing market blue this a or considerably low-carbon While on If large ships zero-carbon global make green focused Japan projects.The for or in intended high eligible anticipated to first-mover of a of reduction European would prohibitive ammonia cover is largely green a products. the the been when emission is keenly is currently green are that which governments for initially ammonia costs this fuel. power process ammonia legislation began instead passes, than blue low-carbon the working previously legislation as we be also of diesel as marine fuel potential entirely the practical incentives on high considering COX-emitting to Europe, our developing generation, now more bunker on industry option. larger is for focused fuels. only This due has currently increasingly ammonia

scheduled entry to Fortescue, an as ammonia fuel these one successfully clean a trend fuel emerging XXXX. industries ammonia company, numerous and in in to excited involved delivery vessels. the there as of for as soon this to in Australian with be as coming into We're used service combination continues ammonia-powered and and expect grow, vessels on in and to Singapore-based materials the marine very and order of other and a suppliers leading years. fuel be Interest industrials on low-carbon are one diesel ammonia its of

a Industrials We questions, meaningful our participating ongoing the to look following operations on to like Cross we June New our in York in I'd open it Stifel our profitability and Chicago have excited and, Conference value. profitable in Virtual ESG now Insights your our Industrial to future.Before we're Wells Combining we at we you those our XXth; provide and believe We transition. a XXth. up about we current I'm Xth; the improve forward play June: the we'll for in initiatives be Thanks. low-carbon way to those creating June June a to on prepared speaking in in on take Conference conferences the some on that energy happy of Boston Bank Sector be events.That with activities, Xth; June turn, shareholder with Conference mention Deutsche Fargo's will remarks, the will concludes lot Conference that the on increase of believe Jefferies questions. in on

Operator

UBS. [Operator today Instructions] Our first Spector from question coming from Josh is

Joshua Spector

because your the quarter. is the to So, on ask you prices the I U.S. through prepared about talked when higher in tighter second supply-demand comments wanted UAN

comments to a that, North factors part moving you dynamic? the down about If and a you supply-demand compare do quarter. balanced there's can as but pricing more maybe of think in links tighter curve versus through America that the becomes seasonal to cost your back the when Obviously,

Mark Behrman

why Damien, take you that don't one?

Damien Renwick

doing? think a question. I elements there's Look, couple Josh, to how are Hi, your Yes. of you

the playing stable So, really key prior prices. through out And have we've the up first dynamics took of in and They turn than one been imports QX. seen, here a UAN lower seeing we're much part of U.S. pretty what UAN of tracking is years. QX all, early

said take The of of of remarks, bit we've little going urea I moment. opportunity, for that. And factors I and in advantage that's where to we've guess, Other created to so, play, at in uncertainty into some are urea, come able the earlier farmers got been that buyers. created my pockets a as has, volatility

we're towards we the prices to there's so, buying start And see end sure up be, stable until of but And QX. limited will reset. extent, stage, when we at the forward be that not to should a see but this it'll

Mark Behrman

demand, think We there's of a pent-up right? though, bunch

Damien Renwick

Yes, so. I think

In and of closer hand-to-mouth. retailers the terms they're co-ops, to buying

starts and through a be of get end application really there'll to there'll and and So, kicks support pricing of time activity, that'll buying right surge until season. the their when be we a in,

Joshua Spector

if appreciate of I about, some if walking were of I made. And Thanks, but to that. on you that year, wanted seemed flat and be be talking expect guidance you EBITDA you were would Damien. on versus higher, volumes through I volumes heard probably guidance think early, the I you for Cheryl prior was XQ EBITDA, I the it's your lift. terms when up of skip XQ I'll XQ XQ, comments this year, if I calling or seasonally rest the it know follow in and talking flat guess, were like that you'd about don't would flat that would be surprising that volumes. prices And when I

that? So, maybe talk some and of through can you clarify

Cheryl Maguire

Yes. Sure, Josh.

quarters would a prior against so of comparative normalization basis, see decline the have big year I X consecutive post were that script to? periods. your we the after Is let that start pricing did point think, wouldn't pricing of lower to QX, years, in just that me the that prior say referring question. clarify comparative that you we I versus on

Joshua Spector

Yes, year-over-year. I I pricing second were half thought starting maybe to misheard guide flat EBITDA. EBITDA you towards versus

that's So, then it. pretty if answers heard I wrong, much that

Cheryl Maguire

Yes.

EBITDA. not relation in pricing, to Just

Operator

you. Thank

is Sachs. coming from today Goldman question Next from Samuelson Adam

Adam Samuelson

perspective, ammonia, half questioning, framework the Maybe on what but and for you net sequestration back contribute to picking obviously, we there? framed year level Day the EBITDA a that thinking in what's be last a help would carbon would reliability on from plants. from at be year year second Analyst And plant in earnings line operating incremental quarter, the about no 'XX year-on-year to at this bridging your that some and headwind you that normalized about still what as little after the ago, the the think then and year. 'XX? EBITDA a in been think would performance to we over the up there us full Obviously, pricing of of as actually clean think a on just uplift getting about longer I second have realized guess, the operational gave can that uplift just point, rates confidence the

Cheryl Maguire

Yes, sure, Adam.

were XXXX, XX%, I ammonia. probably I that's what improved think, $XXX uplift point I talking going spoken past would think about And we million We've not to about is million would when just what $XX I do bridge we're around on of which to call $XX from of out from it EBITDA. is there in the to million reliability.

to We've assuming in go ammonia. are downstream not UAN. that and going also we're that as nitric sell acid-AN to solution capacity We got product

that downstream there's additional So, impact production. from uplift there on the

So, initiatives we if right from $XXX That's doing production, expansion got $XX improved that some you here on the have costs $XX some We've add try higher the million Pryor EBITDA. another, of quarter. another accelerate go. we to million million are of carrying we're $XX third we million $XX at to as these the take million, in now that call to urea the it,

agreement, Some of should margin we've talked of call And in the coming and $X to online another, Lapis million about from sequestration then $XX million those it, enhancement carbon $X XXXX. another add that's million EBITDA. projects

go So, think about that's how the the we next, uplift it, through we EBITDA months. XX call as

Mark Behrman

a our actually. Yes, question, Adam, to as far great ability as it, do confidence it's in

on to take. we with what our to And last and will month, the a and spent leadership create time it manufacturing spending how get roadmap XX%, so, sites probably our really we

And we're get can would confident we so, highly there. say that that I

Adam Samuelson

sheet. balance the Cheryl, one That's And another on helpful. then maybe for just

some bought back stock. You

in looking would in a at total have and deployment capital April. You target you the in and also buyback repurchase of for from what in quarter debt the seemingly notes be mind a further this you perspective Do bought terms back some year? of

Mark Behrman

we Yes, bought another... -- date, back bought that we've I to $XX back of debt and think so, million

Cheryl Maguire

million Yes. to $XX stock. million of $XX

Mark Behrman

So see I a where make a then we purchases move some think back a take there, to combination are, stock. continued and our of then buy we on or see we've breather are, we'll forward are, allocated of decision with debt about And our what cash needs $XXX not. we'll and million projects and where whether

Operator

The from Deutsche Begleiter David coming from next question is Bank.

David Begleiter

the these of taking just Mark, you at are thinking natural gas over how looking prices, term? advantage prices lower about longer

Mark Behrman

Well, we last we've debated We the -- X years. internally, it, this it's they're for debate great to taking seem a and forward tried some to because I And purchases last million big really hedges, a and we've we've $XX actual lower. somewhat it And prices call question. the want were in locking take lost some, them. based actually not the way, won of at lost for, unfortunately, prices right? higher We on potential year, it, when some we call in

to lock going bet a on of in going the in very often, natural issues taking position the enough natural the any this pass-through be, that course, to combined of And needs. we're of views on XX% have the of on actually prices there. fertilizer of lot right gas sure got coming But where on views of that on there's have next in really end gas up If on forward where our any forward now lot doesn't to since And every we've well. which conflicting at purchases side, and what's prices towards that as there. purchasing year our gas are make out want is into ground. lock in, they're we've primarily if we how to it we'll primarily marketplace we us with the think, to the happen a lock infrequent, industrial you product, we gas and very LNG So, side, margin in lock lock year. month actually of got in in in going much whole lock make I that and And, a that's we the other then conflicting gas we beginning of -- going the gas read customers

of some be in the then gas, that strategy starting hedge and and winter our month to to to is buy the forward where think think in buy do it or now right gas more to somewhat the can continue winter, lock I primarily volatile. So, about we Xst we're actually

David Begleiter

debt point, use the you buying how the or time? on at you decide versus to just any more And of Understood. stock guys, stock, debt do any what's beneficial

Damien Renwick

think, on saying our Well, been is to in that which we right? Cheryl's I million mid-market public X.Xx leverage, first, target EBITDA, so the referred $XXX And that leverage pretty Cheryl is X.Xx earlier. say

$XXX So, that be would million.

of pretty bit much think, projects, that storms million To continue any allow also we just We're $XXX be an to capital would a make to ourselves pricing weather bulletproof repurchase more to a we we're debt. fund relatively more in and last and can million over-levered consider with thing at is and the volatile $XX to quickly, industry more in So, us delevering somewhat right? somewhat where want ever to do move give comfort, position. I

lucky So, think liquidity debt. we enough we pretty enough there have certainly and cash stock. first stock I I right We're now, that all going about not we think is think debt And limb, out do our about can both but hope on we believe that that's I'm and the undervalued. I a that when think thing we

back at I stock sense of some levels that for buying these So, us. a think makes lot

Operator

Capital from from today question Next Wong Markets. coming Andrew is RBC

Andrew Wong

versus Could come just maybe view And bit about rebound going It maybe we that a premiums that. forward? just like forward? what's you seems urea, down talk nitrate little on pricing ammonium driving have see going your could the

Damien Renwick

some in of AN I to high, switching gets What urea. get and through. those for little forward think, there's AN more into as a see bit changes rebound if terms some the start see demand you'll in of trends, you'll we I some then to marketplace. But tend application incentivize natural comes that been to of we Yes, in too of is some demand for think, that pricing going

happy of very with some at things at we're where this right think So, those But minute. dynamics. are I constantly working we're against

Andrew Wong

about test? the Looks saying around talk it's LSB What Amogy, just collaboration testing successful maybe initial right? the with for I I'm a think, is like that is in then QX. opportunity And if that

Mark Behrman

we think things facilities look, low-carbon we whole it's when but Well, really to can development that going talk build we really talking to think talking to started when are our we about transition one together, now we're and with cell, hydrogen is Amogy want, I Power-to-X how be so got run engine. that demand-driven. people because into fuel engines and to of conversations starting allows can basically to existing hydrogen, the And this on system the about ammonia about all work I convert and people energy they've to ammonia cell a they've fuel the got

working market, part a vessels big what of really a and down talked It's marine inland in lot marketplace together develop was the up lot So the United we the to rivers, here a of about used. fuel of States. going dirty

be ammonia for availability And ammonia. can sell that marketplace, that low-carbon run there And that. so us needs sell the low-carbon to for needs to to them be systems, of into engines there to on

of So, glove hand kind it's fits. in in that it way the like

think, and think try to would that's with I And get with really it Coast Washington the to that develop is I progress. as get Coast But test as longer take to why permitting. believe U.S. -- end political Guard. understand opportunity supposed been that last delayed, them scene we're right working market So year, the which really it's they've to well educate and made the their work to was taken them work with happen and the understand that's I has Guard and a of lot to what really of towards why

that. about excited we're So

Operator

from next from coming is Rob Granite Research. [Operator Instructions] McGuire Our question

Robert McGuire

volumes? on about on your could Perhaps behind that, downstream basis and you of remainder think Could healthy what's the increase if year-over-year it XXXX. elaborate talk production continue please just in you a for

Damien Renwick

we've our across so assets, exactly to that's And basically, them in a volumes. of right out on get we're the and doing plants, position what good the sold we then board. performance from sell Rob, we're as improved downstream increase been all those

simple So, it's pretty in aspect. that

Mark Behrman

Yes.

find and diligently in find in about tons working we upgrade. think, customer of love El pipeline we're to ammonia we've fact, inject I the to to sell got Dorado a we'd that way, and to into that way a XXX,XXX a

think to as that, some certainly we we think capabilities. I past. So, an move more forward. in enhancement We'll that like the upgrading some more talked do that about there's take still we've we've got margin capital expansion But

Damien Renwick

Yes. is what's mix, margin that position those what's and term we on bit contract optimize enhancement take other upgrades. of and whatever the do And pricing continually the revise how or mix, the on or we basically we that of

So, yes.

Cheryl Maguire

further. and as in of continue acid. downstream I AN, Rob, out, production thinking sales our in increase QX to ammonia And QX, would point upgrade volumes we in is other of you're I look to UAN, And one think for on script, to about thing we Yes. all I further see the nitric when expect then, to course, it to and you'll a alluded corresponding see decrease

Robert McGuire

from three helpful you. of all That's

how the from spring XQ but could think was on you pull-forward about elaborate, touched on, strength you future you tell a you about demand? appreciate into it. does Moving the also words, it comments, I'd in talk would if QX, the that there application, of characterize and you could other what In if you

Damien Renwick

way season is the Look, of Planting Yes. setting I looking the think it's ahead pretty X-year running average. the is up, good.

on I XX% the average. versus in about last we're think XX% report,

season. pretty of pointing had UAN all some advantage pre-plant think products. this season be throws well-positioned we're And whatever take will nitrogen it that's really run good really now that a spring strong means year. for and us, focused to Look, on healthy a So, what but to at and on ammonia, the other the we of we're we that a we're clearly, confident

Robert McGuire

than the pressure then but Okay. carbon lastly, keeping is you Appreciate mining you rest simply discuss can different it footprint? they to America? Or the with Are that. under industry's touched push they're the past, this corporate its just decrease of in And else? on up everyone

Damien Renwick

strong That's big of a on got effort to driving a trying and for industry both, people responsible question. Look, all is I probably there. really mining It's the an the producers decarbonize of reports think. improvements They've sustainability some bit that. and interesting have

of project So, we're El look some commission come our through our of some at on low-carbon them that seeing our Dorado. to offerings in as with we discussions

So, I continue think we're their and hope chains. well-placed And to of to try to they take supply advantage we that decarbonize push that.

Robert McGuire

follow think same? start in coming next going that look it is on, there's years mining the for do more probably the ammonia or you few low-carbon to from you to about or industrial, demand when Just producing,

Damien Renwick

same. It's think will hard split the I look it about to Difficulty] [Technical the...

Operator

Please line experiencing not technical for a [Operator online has Rob, rejoined. stand Rob? I The Instructions] question, now difficulties. disconnect. believe, were do We're Please by. you speaker

Robert McGuire

Yes, indeed.

on -- upgrades the you to there rate? taking on, mind. uptick sorry move Are I'm that. if turnarounds Just base in just place don't meaningful your about onstream going touching to any

Damien Renwick

Rob, reliability. turnaround a produce on UAN really of XX,XXX pursuing focused be got both we've per at is implementing And and going of us is Pryor to XX,XXX Pryor, tonnes scope help improving expansion that year. and that'll we're urea Yes, for Cherokee, and the another the rest to sites, really

Mark Behrman

Yes.

improve operating sale. we the obviously to So, that and rates, with higher product of for out turnarounds come expect much would just

of actually, turnarounds amount major into we're us. on them. yes, So, the it's these deploying for are fair capital for We're And that looking we're focused turnarounds. very -- a

Operator

from coming today next Piper Sandler. question is Our from Neivert Charles

Charles Neivert

level, for Just the come it seems X quick at to lately. is had rise it couple to SG&A percentage The we Is over or last Should been back where there any be expect it? the higher years? to the it stay on particular going of question. reason to

Mark Behrman

for XX to think, programs. I carry Charlie, going to reliability we as see push $XX in million $XX you're Yes, SG&A XX XX the million maybe extra an to next months, months, us

is corporate rolling carrying of obviously of up as up it to that but overhead. of some sales, Some cost we're

rates definitely So, reduction we've that reliability once the see in we achieve some we outlined, expense. should

Charles Neivert

to be where terms when seen mind trailing to get then of But of has volatile, and so all off terms, target And last bit the big target like begin debt mind? do in through? way in for as XX guys like over a net level your you moving better movement. when EBITDA it's do its multiple, guys to a a has have little worked some lack to Admittedly, EBITDA you less around year, in have things, a you'd been months

Mark Behrman

than Yes, X.Xx more no levered.

Charles Neivert

obviously It a At numbers, the Gas it like but for having of quite where just it considering it seen be exceptionally them down protection that $XXX of out seem for to any might to way. lower increase now? got not going you're online? somebody in numbers but it them easier see come than they've there? back that production bit. to the into in incredibly might it having of it's Does has the still forgetting was, be European Do but higher you Obviously, the be some might production gas keep product much is move coming because the profitable, area. U.S., come ammonia, high game, the where enough see of European

Damien Renwick

some Look, sustained in I think levels the see operations. European want producers to to to some probably confidence will pricing restart more order get

under pass lot still of a bridge that the there's aspect. to So, in water I think

plants and months. have that that quo a think continue of restarted will for think continue I some bit little status the see we'll on, I

Mark Behrman

import think versus I are. on production, of prices cost and those depends also levels it where

but a general, cheaper low still be prices think And in higher for if much several low I might in on is gas here the relatively and it's been where over years, last that import. to them so, compared cap Europe, to gas is ammonia puts

I it's decision. just economic So, think a total really

Charles Neivert

ammonia from closure Do use of close U.K. current operation, outright chose of but the around completely, you [ the see like or might Europe Any who the throwing supply to facility? or the is consider way it towel substitution in anyone and the in ammonia ] in CF the close players outside?

Damien Renwick

late. heard of that Look, we've of, not

their producers, I and like think already moves. of BASF, they've made CF most the

Mark Behrman

couple of A Eastern facilities. closed Europeans down have

Damien Renwick

Yes, probably do but those I we of a think that haven't rest are that And shut the turning happy to suspended or are operating, down, -- heard are that are anything into closure. permanent so. those

Mark Behrman

period you some only able to it you you will It's that after is back just to have shut facility. to think time right? face it, maintain be turn expensive of it on. a can't can to Because down the thing I so people maintain that start

think I force decisions. maintenance point, will some the of at some So, cost

Operator

over floor management question-and-answer I'd our to turn session. further the of to end closing like comments. any reached for We've back

Mark Behrman

you. Thank

interest you follow-up us, to Thank for them. LSB follow-up if calls much questions, and a As day. in happy we'll you. free thanks feel great call your And so always, or Industries. have to be any answer Have

Operator

teleconference. does That today's conclude you. Thank

may You disconnect time wonderful participation a your you line and today. have your at this day. We for thank

LSB Industries (LXU) 30 Apr 242024 Q1 Earnings call transcript