ATLANTA - Sisecam Resources LP (NYSE: SIRE) ('we,' 'us, 'our,' or the 'Partnership') reported its financial and operating results for third quarter ended September 30, 2022.
Third Quarter 2022 Financial Highlights:
Net sales of $190.5 million increased 40.5% from the prior-year third quarter; year-to-date net sales of $543.0 million increased 41.4% over the prior year for the same period. This increase is primarily attributable to a sales price increase of 42.6% even though the sales volume slightly decreased by 1.5% for the three months ended September 30, 2022, compared to the three months ended September 30, 2021. The increase for the nine months ended September 30, 2022 from the nine months ended September 30, 2021, primarily driven by an increase in the average sales price by 44.3% due to both international and domestic higher demand. The higher sales prices were due to strong demand in the domestic and international markets.
Soda ash volume produced decreased 4.6% from the prior-year third quarter, and soda ash volume sold decreased 1.5% from the prior-year third quarter; year-to-date soda ash volume produced increased 0.4% from the prior-year, and soda ash volume sold decreased 2.0% from the prior-year for the same period.
Net income of $31.1 million increased $15.7 million from the prior-year third quarter; year-to-date net income of $94.1 million increased $66.3 million over the prior year for the same period. The increases are primarily due to higher average sales price partly offset by inflationary impact on operating costs.
Adjusted EBITDA of $40.6 million increased 68.5% from the prior-year third quarter; year-to-date Adjusted EBITDA of $120.1 million increased 114.1% over the prior year for the same period. This increase is primarily attributable to the operating income increase.
Basic earnings per unit of $0.76 for the quarter increased 111.1% over the prior-year third quarter of $0.36; year-to-date basic earnings per unit of $2.30 increased 265.1% over the prior year for the same period.
Net cash provided by operating activities of $49.3 million increased $39.4 million over prior-year third quarter; year-to-date net cash provided by operating activities of $81.7 million increased $53.4 million over the prior year in the same period.
Distributable cash flow of $16.8 million increased 104.9% compared to the prior-year third quarter; year-to-date distributable cash flow of $48.1 million increased 204.4% over the prior year for the same period.
Ertugrul Kaloglu, CEO, commented: The Sisecam Resources team delivered another successful quarter adding to strong year-to-date results mostly driven by strong pricing and demand in the soda ash market globally. We safely produced 686 thousand short tons in the third quarter, and successfully completed our planned Unit 6 production line annual maintenance.
Strong sales results, both domestically and internationally, drove strong third quarter and YTD sales helping to offset challenges resulting from inflation, recession concerns and continued supply chain issues.
Third quarter and Year-to-Date net sales of $190.5 million and $543 million, respectively, an increase year-over-year of 40.5% and 41.4% respectively, have benefited from continued advantageous sales conditions particularly in markets overseas. While higher energy and freight expense have challenged cost of products sold, the team has worked hard to manage those costs and reduce impact of any increases.
Expense and cash flow management continue to be a focus for the team to reduce risks related to higher interest rates, inflation, supply chain pressures and a possible recession. The company is preparing for possible future uncertainty by prioritizing balance sheet management with a conservative capital structure to continue to meet future cash flow needs.
We are pleased with our strong commercial position and stable operations which have helped drive superior results in the third quarter. Going forward, our focus will remain on reducing future operational and financial risks to manage potential impacts from uncertainty in the economy.
Net sales. Net sales increased by 40.5% to $190.5 million for the three months ended September 30, 2022 from $135.6 million for the three months ended September 30, 2021, primarily driven by an increase in international average sales price of 84.7% because the prices are generally negotiated on a quarterly basis with improving supply and demand fundamentals recognized for soda ash in the global market and particularly in Asia. Domestic average price also increased by 7.5% due to customer mix while also factoring in the overall annual market price increase as the market has experienced fundamental improvements. The higher sales prices were due to strong demand in the domestic and international markets.
Cost of products sold, including depreciation, depletion and amortization expense, freight costs and affiliates. Cost of products sold, including depreciation, depletion and amortization expense, freight costs and affiliates increased by 34.7% to $151.1 million for the three months ended September 30, 2022 from $112.2 million for the three months ended September 30, 2021, which was primarily due to increases in freight cost, more specifically due to significant ocean freight cost increases impacted by recent global supply chain constraints as well as price increases in fuel.
Selling, general and administrative expenses. Our selling, general and administrative expenses decreased 1.5% to $6.6 million for the three months ended September 30, 2022, compared to $6.7 million for the three months ended September 30, 2021. The decrease was primarily due to the decline in sales volume to ANSAC and therefore lower related charge per ton which was mostly offset by loss on disposal of assets for the three months ended September 30, 2022, compared to three months ended September 30, 2021.
Operating income. As a result of the foregoing, operating income increased by approximately 96.4% to $32.8 million for the three months ended September 30, 2021 from $16.7 million operating income for the three months ended September 30, 2021. The increase was primarily due to higher net sales resulting from higher average sales price.
Net income. As a result of the foregoing, net income increased by approximately 101.9% to $31.1 million for the three months ended September 30, 2022, from $15.4 million for the three months ended September 30, 2021.
Contact:
Investor
Sisecam Resources LP
M. Nedim Kulaksizoglu
Chief Financial Officer
T: (770) 375-2321
E: NKULAKSIZOGLU@sisecam.com
SISECAM RESOURCES LP 
