Methanex earns $265 million in third quarter as methanol prices remain strong
Key Facts
Methanex reported net income attributable to shareholders of $265 million in the third quarter of 2026, compared with a loss of $7 million in the same period last year, according to the company. Adjusted net income rose to $284 million from $5 million, while adjusted earnings per share were $3.69, versus $0.06. Revenue came to $1.388 billion, up from $927 million a year earlier. Adjusted EBITDA increased to $543 million from $191 million. Chief Executive Rich Sumner said the impact of the Middle East conflict on the methanol industry continued during the quarter, and the loss of a significant portion of supply supported strong prices.
Operating performance did not match the year-over-year improvement on a sequential basis: the average realized price fell to $510 per ton from $529 in the second quarter, but remained above $345 a year earlier. Methanol sales, meanwhile, rose to 2.595 million tons from 2.555 million tons in the previous quarter. Methanex-attributable production was 2.143 million tons, compared with 2.213 million tons in the second quarter. The company reported record production at its North American assets. Sumner said the enhanced asset base continued to perform well, particularly in the region, helping support earnings and cash flow. The sequential price decline reflects a divergence between the strong prices the company attributed to supply shortages and the realized price falling from its peak in the previous quarter.
Production varied across the company’s regions because of gas and operating conditions. Methanex said Chilean output declined due to expected seasonal constraints on gas availability, while production in Trinidad fell after the Titan plant produced 34,000 tons in the third quarter, compared with 121,000 tons in the second quarter. The company then shut the plant and took it out of service indefinitely. In Egypt, the plant produced 330,000 tons, the same amount recorded in the second quarter; Methanex’s 50% share was about 165,000 tons in both quarters. In New Zealand, production rose to 156,000 tons from 46,000 tons in the previous quarter, following a planned shutdown there during that quarter.
Cash liquidity improved alongside earnings: cash flow from operating activities rose to $646 million in the third quarter, compared with $184 million a year earlier. The company ended the quarter on September 30 with cash of $912 million, as well as access to an undrawn $400 million revolving credit facility. Methanex paid total quarterly dividends of $14 million, equivalent to $0.185 per common share. After the quarter ended, it notified bondholders of its intention to redeem $300 million of notes from a total issuance of $700 million due in October 2027. The company expects to redeem the remaining $400 million during the fourth quarter of 2026.
On capital allocation, the company approved a normal course issuer bid on October 29 equivalent to 5%, for a maximum of 3,868,213 shares, to run through November 3, 2027. Methanex expects the average realized methanol price in October and November to range from $525 to $550 per ton. Based on a higher realized price and sales at levels similar to its production, the company expects fourth-quarter adjusted EBITDA to be higher. It also targets production of about 9.0 million tons of methanol on an attributable basis and 0.3 million tons of ammonia during 2026. In New Zealand, it agreed to sell most of its remaining gas contract entitlements starting in the first quarter of 2027 through the end of the contract, and expects to shut down its production facilities there indefinitely in the same quarter.