Tidewater Midstream And Infrastructure ((TSE:TWM)) has held its Q4 earnings call. Read on for the main highlights of the call.
Tidewater Midstream and Infrastructure’s recent earnings call presented a mixed bag of strategic successes and operational hurdles. The company made notable strides in transitioning to in-house marketing and successfully filed a trade complaint, yet faced challenges with decreased throughput and lower crack spreads. Despite these operational setbacks, Tidewater significantly reduced its net loss compared to the previous year, and the sale of noncore assets contributed to its deleveraging efforts.
Successful Transition to In-house Marketing
Tidewater has successfully transitioned to marketing all refined products produced at both its HDRD and PGR facilities in-house. This move follows the expiration of a five-year offtake agreement with Cenovus, marking a significant strategic shift for the company.
Anti-Dumping Investigation
In a proactive move, Tidewater Renewables filed a trade complaint against subsidized renewable diesel imports from the United States. This action has prompted a countervailing anti-subsidy and antidumping duty investigation by the Canada Border Services Agency (CBSA).
Noncore Asset Sales for Deleveraging
The company completed the sale of three noncore assets, generating over $40 million. This includes a $24 million sale of the BRC Roadway Network and a $10.6 million sale of the used cooking oil business, all of which were used to deleverage the company’s balance sheet.
Operational Efficiency and Cost Reduction
Tidewater completed a major turnaround at the BRC Complex under budget, initiating cost and capital savings exceeding $15 million. The company anticipates ongoing run rate savings between $7 million and $10 million.
Decreased Throughput at PGR
The Prince George Refinery (PGR) experienced a 6% decrease in throughput, averaging 10,963 barrels per day. This decline was attributed to scheduled maintenance and third-party pipeline maintenance.
Lower Crack Spreads
Crack spreads at Prince George averaged $75 per barrel in Q4 2024, a decrease from $87 per barrel in Q4 2023. However, there was an improvement to $86 at the start of Q1 2025.
Net Loss in Q4 2024
Tidewater reported a consolidated net loss of $3.3 million for Q4 2024, a significant improvement from the $331.8 million loss in Q4 2023, showcasing the company’s progress in financial recovery.
Temporary Curtailment at Ram River Gas Plant
Gas processing activities at the Ram River gas plant were temporarily curtailed due to producers shutting in volumes as a result of depressed natural gas prices.
Forward-Looking Guidance
Looking ahead, Tidewater provided several key metrics and guidance details. The company aims for $15 million to $20 million in capital maintenance for 2025. The Brazeau River Complex averaged 132 million cubic feet per day, while the HDR facility’s throughput was slightly down from Q3 2024. The company also expects duties valued between $0.50 and $0.80 per liter from the trade complaint against U.S. renewable diesel imports.
In summary, Tidewater Midstream and Infrastructure’s earnings call highlighted a blend of strategic achievements and operational challenges. The company has made significant progress in reducing its net loss and leveraging noncore asset sales for financial stability. As Tidewater navigates these challenges, its strategic initiatives and forward-looking guidance suggest a cautiously optimistic outlook for the future.