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CVR PARTNERS, LP (UAN)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 delivered strong results: net sales $168.6M, net income $38.8M ($3.67/unit), EBITDA $67.2M, operating income $46.3M, and a cash distribution of $3.89 per unit . Versus Q2 2024, revenue rose to $168.6M from $132.9M and EBITDA to $67.2M from $53.8M, driven by higher realized pricing and healthy demand .
  • Pricing strength was broad: average realized ammonia +14% YoY to $593/ton and UAN +18% YoY to $317/ton, amid tight inventory and increased corn plantings; utilization was 91% given planned and unplanned downtime .
  • Q3 2025 outlook guides ammonia utilization 93–98%, direct operating expenses $60–$65M, and capex $20–$25M; management expects seasonal price declines to be narrower than normal given supply tightness .
  • Catalysts: higher distribution, favorable pricing backdrop, and progress on growth/reliability projects (control systems, nitrous oxide abatement, feedstock flexibility to natural gas/hydrogen) supporting medium-term capacity and ESG positioning .

What Went Well and What Went Wrong

What Went Well

  • Realized pricing strength: ammonia $593/ton (+14% YoY) and UAN $317/ton (+18% YoY), supporting revenue and EBITDA growth despite lower production volumes . CEO: “Supply and demand balances for nitrogen fertilizer continue to be tight and pricing has remained strong” .
  • Distribution increased: declared $3.89 per common unit for Q2 2025, underpinned by $41.1M available cash for distribution .
  • Strategic execution: progress on reliability and debottlenecking initiatives, DEF loadout expansion, and Coffeyville project to enable feedstock flexibility and ~8% nameplate ammonia capacity expansion; target >95% utilization longer term .

What Went Wrong

  • Utilization stepped down: consolidated ammonia utilization 91% (vs 101% in Q1 2025 and 102% in Q2 2024) due to planned control system upgrades at East Dubuque and brief unplanned outages .
  • Elevated operating costs: DOE guided $60–$65M for Q3 2025 amid higher natural gas and electricity costs; Q2 DOE was $60.5M .
  • Production lower YoY: Q2 gross ammonia 197k tons vs 221k and UAN 321k vs 337k, even as pricing/pricing mix offset to deliver stronger financials .

Financial Results

MetricQ2 2024Q4 2024Q1 2025Q2 2025
Net Sales ($USD Millions)$132.9 $139.6 $142.9 $168.6
Operating Income ($USD Millions)$33.6 $25.7 $34.6 $46.3
Net Income ($USD Millions)$26.2 $18.3 $27.1 $38.8
Diluted EPS ($)$2.48 $1.73 $2.56 $3.67
EBITDA ($USD Millions)$53.8 $49.8 $52.9 $67.2
EBITDA Margin %40.0%*35.7%*36.8%*40.0%*
EBIT Margin %27.8%*28.6%*24.2%*27.6%*
Net Income Margin %19.7%*13.1%*19.0%*23.0%*

Values with * retrieved from S&P Global.

Segment/Components of Net Sales

ComponentQ2 2024 ($USD Millions)Q2 2025 ($USD Millions)
Fertilizer Product Sales$119.4 $153.9
Other$13.5 $14.7
Total Net Sales$132.9 $168.6

Key KPIs

KPIQ2 2024Q1 2025Q2 2025
Ammonia Utilization Rate (%)102% 101% 91%
Ammonia Gross Produced (k tons)221 216 197
Ammonia Net Available for Sale (k tons)69 64 54
UAN Produced (k tons)337 348 321
Ammonia Sales Volumes (k tons)43 60 57
UAN Sales Volumes (k tons)330 336 345
Avg Realized Price – Ammonia ($/ton)$520 $554 $593
Avg Realized Price – UAN ($/ton)$268 $256 $317
Available Cash for Distribution ($USD Millions)—$23.9 $41.1
Cash and Cash Equivalents ($USD Millions)—$121.8 $114.4

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Ammonia Utilization Rate (%)Q2 202593–97% ——
Direct Operating Expenses ($USD Millions)Q2 2025$57–$62 ——
Total Capital Expenditures ($USD Millions)Q2 2025$18–$22 ——
Ammonia Utilization Rate (%)Q3 2025—93–98% Introduced
Direct Operating Expenses ($USD Millions)Q3 2025—$60–$65 Introduced
Total Capital Expenditures ($USD Millions)Q3 2025—$20–$25 Introduced

Management also reiterated 2025 total capex of roughly $55M, with $40–$45M maintenance, funded by reserves .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024 & Q1 2025)Current Period (Q2 2025)Trend
Demand & PricingTight inventories; rising prices into spring; UAN first‑quarter pricing lower due to timing; corn acres ~95M; favorable farmer economics Strong spring demand; realized price increases; fall pricing expected similar to spring; narrower than typical summer discount Positive, sustained strength
Supply/GeopoliticsEurope high on cost curve; volatile supply; tariffs potential wildcard 20% global urea export capacity offline temporarily; potential tariffs on Russian fertilizer; Europe nat gas ~$11/MMBtu Tight supply supports prices
Operations/UtilizationTarget >95% utilization; 101% in Q1 91% utilization due to planned upgrades and brief outages; Q3 guide 93–98% Near-term dip, improving in Q3
Cost StructureDOE influenced by nat gas/electricity; pet coke expected to rise in Q2 Elevated electricity at peak; nat gas higher YoY; DOE guide $60–$65M Cost headwinds near term
Capex/ProjectsCoffeyville feedstock flexibility (gas/hydrogen), low double-digit $M; DEF expansion; water/electric reliability; N2O abatement planned Begin implementing Coffeyville project in fall; N2O abatement unit during October turnaround; brownfield adds: ~100 t/day at Coffeyville, >5% at East Dubuque Execution progressing
ESG/Low-CarbonN2O abatement strategy Pursuing low-carbon certification; all nitric acid plants with N2O abatement post turnaround Advancing
Logistics/Industry Structure—Watching Union Pacific–Norfolk Southern merger for new lanes; industry consolidation possible Potential logistics upside

Management Commentary

  • “Supply and demand balances for nitrogen fertilizer continue to be tight and pricing has remained strong through the end of the planting season.” — CEO Mark Pytosh .
  • “We ended the quarter with total liquidity of $162 million... and the Board declared a distribution of $3.89 per common unit.” — CFO Dane Neumann .
  • “This project would give us the ability to choose the optimal feedstock mix... making Coffeyville the only nitrogen fertilizer plant in the U.S. with that feedstock flexibility.” — CEO Mark Pytosh .
  • “The normal seasonal price declines... have been much narrower this year.” — CEO Mark Pytosh .

Q&A Highlights

  • Summer fill pricing: UAN fill delayed due to strong late-season demand and low inventories; expected decline from in-season pricing materially smaller than typical 25–30% .
  • Cost drivers: DOE elevated by higher electricity during peak periods and higher natural gas; Q3 DOE guided $60–$65M, including work on control systems .
  • Downtime: Planned control system upgrade at East Dubuque; unplanned outages addressed, not expected to recur .
  • Capacity growth: Brownfield projects to add ~100 tons/day ammonia at Coffeyville and >5% at East Dubuque; classified as growth capex funded by reserves .
  • Industry structure: Potential rail merger could open new lanes; broader consolidation may continue given geopolitics and U.S. cost/logistics advantages .

Estimates Context

Wall Street consensus from S&P Global was unavailable for EPS, revenue, and EBITDA in Q2 2025 (no estimates on file). Comparisons below anchor to actuals.

Metric (Q2 2025)Consensus Mean# of EstimatesActual
Revenue ($USD Millions)N/AN/A$168.6
EBITDA ($USD Millions)N/AN/A$67.2
EPS ($)N/AN/A$3.67

Values retrieved from S&P Global.

Key Takeaways for Investors

  • Distribution momentum: Q2 distribution raised to $3.89 per unit, supported by $41.1M available cash for distribution; reserves maintained for growth/reliability projects .
  • Pricing tailwinds: Tight global/national supply and elevated planted acres drove realized price increases; management expects fall pricing to mirror spring with limited seasonal discounts .
  • Near-term cost headwinds: Elevated electricity and natural gas costs lifting DOE; Q3 DOE guided $60–$65M, tempering margin expansion .
  • Utilization recovery: After 91% in Q2 from upgrades/outages, Q3 guide 93–98%; medium-term target remains >95% through reliability/debottlenecking .
  • Capacity/ESG upside: Coffeyville feedstock flexibility (gas/hydrogen) and N2O abatement improve cost/optionalities and support low-carbon certification; brownfield adds meaningfully increase output at low capital intensity .
  • Macro support: Temporary global urea outages, potential Russia export tariffs, and Europe’s high-cost position support U.S. producers’ pricing and export opportunities .
  • Trading lens: Narrative centers on distribution strength and durable pricing; watch Q3 DOE cadence, fill pricing outcomes, and execution on fall turnaround/capex as near-term stock drivers .