Chemtrade Logistics Income Fund Concludes 2025 With Record Results

Executive Summary

• Chemtrade Logistics Income Fund reported record full‑year 2025 Adjusted EBITDA of $507.4 M (up 7.8% YoY) and net earnings of $139.4 M, driven by higher acid and water solutions margins.
• The fund reaffirmed its 2026 Adjusted EBITDA guidance of $485 M–$525 M, targeting a payout ratio of ~45% and a Net Debt/LTM Adjusted EBITDA ratio near 2.5×.
• Significant balance‑sheet actions in 2025 included reducing convertible debentures by ~90%, issuing new senior unsecured notes (total $375 M), extending the credit facility to 2030, and repurchasing ~8.9 M units under its NCIB.

Key Details

• Full‑Year 2025 Financial Highlights
• Revenue: $1,997.8 M (+11.8% YoY).
• Adjusted EBITDA: $507.4 M (record high; +7.8% YoY).
• Net earnings: $139.4 M (+9.9% YoY).
• Distributable cash after maintenance capex: $228.0 M ($1.99 per unit, +10.8%).

• Monthly distribution increased to $0.06 per unit (≈4% rise) in Jan 2026; payout ratio ~45% at guidance midpoint.

• Quarter‑End 2025 Highlights

• Q4 revenue: $502.0 M (+12.4% YoY).
• Q4 Adjusted EBITDA: $98.2 M (down 9.6% YoY).

• Distributable cash after maintenance capex: $16.7 M ($0.15 per unit, –57.9%).

• Capital Structure & Financing

• Convertible debentures reduced by ~90%; remaining $30.96 M (maturing 2028).
• Issued senior unsecured notes: $125 M @6.375% (due Aug 2029) and $250 M @5.75% (due Oct 2032).
• Credit facility extended to Oct 2030; undrawn capacity $370.3 M.

• Net debt as of Dec 31 2025: $1,180.3 M; Net Debt/LTM Adjusted EBITDA = 2.3×.

• Acquisitions & Organic Growth

• Acquired Polytec, Inc. and assets of Thatcher Group for total US$180 M in 2025.
• Ongoing integration of Polytec and Thatcher assets; focus on water‑chemical portfolio.

• Ultrapure acid projects (Cairo, OH plant completed 2025; Tulsa, OK upgrades) progressing toward commercial ramp‑up in 2026.

• Guidance & Outlook for 2026

• Adjusted EBITDA: $485 M–$525 M (midpoint comparable to 2025 record).
• Maintenance capex: $120 M–$150 M; Growth capex: $35 M–$55 M (primarily water chemicals).
• Lease payments: $70 M–$80 M; Cash interest: $65 M–$75 M; Cash tax: $35 M–$45 M.

• Expected Net Debt/LTM Adjusted EBITDA ≈ 2.5×; implied payout ratio ~45%.

• Shareholder Returns

• NCIB activity in 2025: repurchased ~8.9 M units (≈$100.8 M).

• Additional unit purchases of ~1.9 M in Q4 2025 under approved NCIB.

• Management Commentary

• CEO Scott Rook highlighted record Adjusted EBITDA, operational excellence, and the strategic role of water‑chemical growth and recent acquisitions.
• CFO Rohit Bhardwaj emphasized balance‑sheet optimization, debt refinancing, and disciplined capital allocation supporting both growth and distributions.

Notable Quotes

• “2025 was another year of strong financial and operational performance… delivering the highest annual Adjusted EBITDA result in our history.” – Scott Rook, President & CEO
• “We remain encouraged by the outlook of our water products where we continue to invest organically…” – Scott Rook
• “Our focus on reducing leverage … provided the dry powder necessary to finance two acquisitions during 2025 without diluting our unitholders.” – Rohit Bhardwaj, CFO