CVR Partners

Greetings and welcome to the CVR Partners first quarter 2021 conference call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Richard Roberts, Senior Manager of Financial Planning and Analysis and Investor Relations. Thank you, sir. You may begin.

Thank you, Christine. Good morning, everyone. We appreciate your participation in today's call. With me today are Mark Pytok, our Chief Executive Officer, Tracy Jackson, our Chief Financial Officer, and other members of management. Prior to discussing our 2021 first quarter results, let me remind you that this conference call may contain forward-looking statements. as that term is defined under federal securities laws. For this purpose, any statements made during this call that are not statements of historical facts may be deemed to be forward-looking statements. You are cautioned that these statements may be affected by important factors set forth in our filings for the Securities and Exchange Commission and in our latest earnings release. As a result, actual operations or results may differ materially from the results discussed in the forward-looking statements. We undertake no obligation to publicly update any forward-looking statements whether as a result of new information, future events, or otherwise, except to the extent required by law. Let me remind you that TVR Partners completed a one for 10 reverse split of its common units on November 23rd, 2020. Any per unit references made on this call are on a split adjusted basis. This call also includes various non-GAAP financial measures. The disclosures related to such non-GAAP measures, including reconciliation to the most directly comparable GAAP financial measures, are included in our 2021 first quarter earnings release that we filed with the SEC yesterday after the close of the market. Let me also remind you that we are a variable distribution MLP. We will review our previously established reserves, current cash usage, evaluate future anticipated cash needs, and may reserve amounts for other future cash needs as determined by our General Partners Board. As a result, our distributions, if any, will vary from quarter to quarter due to several factors, including but not limited to operating performance, fluctuations in the prices received for finished products, capital expenditures, and cash reserves deemed necessary or appropriate by the board of directors of our general partner. With that said, I'll turn the call over to Mark Pytosh, our chief executive officer.

Mark. Thank you, Richard, and good morning, everyone, and thank you for joining us for today's call. The summarized financial highlights for the first quarter of 2021 included net sales of $61 million, a net loss of $25 million, and EBITDA of $5 million. We repurchased 24,000 CBR Partners common units for half a million, and there's no cash available for distribution this quarter. During the first quarter of 2021, we experienced some unplanned downtime at Coffeyville due to an outage of the third-party air separation unit in January. The ammonia plant at Coffeyville operated at 87% utilization for the first quarter of 2021 compared to 86% in the first quarter of 2020 that was also impacted by downtime due to third-party outages. At East Dubuque, the ammonia plant operated at 89% utilization, compared to 101% in the prior year period, the result of strong operations following the plant turnaround in the fall of 2019. The severe winter weather in February caused a spike in natural gas pricing, and we elected to shut in production at East Dubuque for several days and sold our contracted natural gas volumes into the market. Our combined operations produced approximately 188,000 growth tons of ammonia, of which 70,000 net tons were available for sale for the first quarter of 2021. This compares to production of 201,000 gross tons of ammonia, of which 78,000 net tons were available for sale in the prior year period. We produced 272,000 tons of UAN in the first quarter of 2021 as compared to 317,000 tons in the prior year period. During the first quarter of 2021, we sold approximately 239,000 tons of UAN at an average price of $159 per ton, and approximately 32,000 tons of ammonia at an average price of $300 per ton. Sales volumes in the quarter were impacted by the previously discussed downtime, as well as shipping restrictions related to winter storm URI. Year-over-year pricing was 14% higher for ammonia, but 4% lower for UAN, as UAN prices were more reflective of the November-December price environment due to forward sales agreements. Nitrogen fertilizer prices have increased significantly since the start of the year, and that strength continued into the spring planting season. Although our first quarter results did not reflect increased spot market prices, we believe that stronger pricing environment will be more evident in our second quarter results. Continued strong crop prices are driving strong demand for crop inputs, which I will discuss further in my closing remarks. I will now turn the call over to Tracy to discuss our financial results.