CVR PARTNERS LP
For the period ended Jun 30, 2024. Filed Jul 30, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Jul 30, 2024
UAN$109.48+0.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-04-30.
0001425292-24-000008
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-07-30.
0001425292-24-000012
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 116 previous paragraphs and 117 current paragraphs.
79 unchanged; 32 reworded; 3 added; 4 removed; 1 previous and 3 current paragraphs rearranged.
Tables are not compared: 16 previous and 18 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (3)
Current report
For the six months ended June 30, 2024, net sales was $260.6 million compared to $409.3 million for the six months ended June 30, 2023. This decrease was primarily due to unfavorable UAN and ammonia pricing conditions and sales volumes which contributed $102.5 million and $35.5 million, respectively, in lower revenues compared to the six months ended June 30, 2023.
Current report
UAN and ammonia sales volumes for the six months ended June 30, 2024 compared to the six months ended June 30, 2023 was primarily attributable to lower UAN and ammonia production volumes as a result of the 14-day planned outage at the Coffeyville Facility during the first quarter of 2024.
Current report
Selling, General, and Administrative Expenses- For the three and six months ended June 30, 2024, Selling, general and administrative expenses was $6.3 million and $13.6 million, respectively, compared to $7.3 million and $14.7 million, respectively, for the three and six months ended June 30, 2023. The decreases were primarily related to lower share-based compensation due to a decrease in market prices for CVR Partners’ common units in the current period.
Removed paragraphs (4)
Previous report
Recent Developments
Previous report
Following good faith bargaining by EDNF, the United Automobile Workers Union and its Local 1391 representing approximately 90 employees at the East Dubuque Facility went on strike on October 18, 2023 after its collective bargaining agreement expired the previous day. The East Dubuque Facility continued to operate during the strike, which ended on February 24, 2024; employees began returning to work on March 4, 2024.
Previous report
Capital Structure
Previous report
On May 6, 2020, the Board, on behalf of the Partnership, authorized a unit repurchase program (the “Unit Repurchase Program”), which was increased on February 22, 2021. The Unit Repurchase Program, as increased, authorized the Partnership to repurchase up to $20 million of the Partnership’s common units. During the three months ended March 31, 2024 and 2023, the Partnership did not repurchase any common units. On February 20, 2024, the Board, on behalf of the Partnership, terminated the nominal authority remaining under the Unit Repurchase Program.
Reworded paragraphs (32)
Previous wording
The following discussion and analysis of our financial condition, results of operations, and cash flows should be read in conjunction with our unaudited condensed consolidated financial statements and related notes and with the statistical information and financial data appearing in this Report, as well as our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the U.S. Securities and Exchange Commission (“SEC”) on February 21, 2024 (the “2023 Form 10-K”). Results of operations for the three months ended March 31, 2024 and cash flows for the three months ended March 31, 2024 are not necessarily indicative of results to be attained for any other period. See “Important Information Regarding Forward-Looking Statements.”
Current wording
The following discussion and analysis of our financial condition, results of operations, and cash flows should be read in conjunction with our unaudited condensed consolidated financial statements and related notes and with the statistical information and financial data appearing in this Report, as well as our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the U.S. Securities and Exchange Commission (“SEC”) on February 21, 2024 (the “2023 Form 10-K”). Results of operations for the three and six months ended June 30, 2024 and cash flows for the six months ended June 30, 2024 are not necessarily indicative of results to be attained for any other period. See “Important Information Regarding Forward-Looking Statements.”
Previous wording
The Partnership believes the general business environment in which it operates will continue to remain volatile, driven by uncertainty around the availability and prices of its feedstocks, demand for its products, inflation, and global supply disruptions. As a result, future operating results and current and long-term financial conditions could be negatively impacted if economic conditions decline and remain volatile. The Partnership is not able at this time to predict the extent to which these events may have a material, or any, effect on its financial or operational results in future periods.
Current wording
The Partnership believes the general business environment in which it operates will continue to remain volatile, driven by uncertainty around the availability and prices of its feedstocks, demand for and prices of its products, inflation, and existing and potential future global supply disruptions. As a result, future operating results and current and long-term financial conditions could be negatively impacted if economic conditions decline and remain volatile. The Partnership is not able at this time to predict the extent to which these events may have a material, or any, effect on its financial or operational results in future periods.
Previous wording
Regulatory Environment - Certain governmental regulations and incentives associated with the automobile transportation and agricultural industries, including the ones related to corn-based ethanol and sustainable aviation fuel production or consumption can directly impact our business. In June 2023, the United States Environmental Protection Agency (“EPA”) announced the renewable volume obligations for 2023, 2024, and 2025 which maintained the conventional biofuel blending level at 15 billion gallons. These actions lead us to believe that the demand on food, in particular corn, for fuel will remain strong for the foreseeable future and support farmer economics that incentivize the use of nitrogen-based fertilizers.
Current wording
Regulatory Environment - Certain governmental regulations and incentives associated with the automobile transportation and agricultural industries, including the ones related to corn-based ethanol and sustainable aviation fuel production or consumption, can, and have, directly impact our business. In June 2023, the United States Environmental Protection Agency (“EPA”) announced the renewable volume obligations for 2023, 2024, and 2025 which maintained the conventional biofuel blending level at 15 billion gallons. These actions lead us to believe that the demand on food, in particular corn, for fuel will remain strong for the foreseeable future and support farmer economics that incentivize the use of nitrogen-based fertilizers.
Previous wording
There have been several proposed climate related rules, in various stages of approval, that, if finalized, would demand considerable efforts to drive new compliance requirements and could impact our disclosure controls and procedures as well as include additional disclosures in our regulatory filings.
Current wording
There have been several proposed and enacted climate-related rules, in various stages of approval, that, if finalized, would demand considerable efforts to comply with new compliance requirements and could impact our disclosure controls and procedures as well as require additional disclosures in our regulatory filings.
Previous wording
Geopolitical Matters - The conflict in the Middle East, which began in October 2023 and continues to escalate, and the ongoing Russia-Ukraine war, could significantly impact global fertilizer and agriculture markets. These conflicts pose significant geopolitical risks to global markets, raise concerns of major implications, such as the enforcement of sanctions, and could disrupt the production and trade of fertilizer, grains, and feedstock through several means, such as trade restrictions. The ultimate outcome of these conflicts, or further escalation or expansion thereof, and any associated market disruptions are difficult to predict and may affect our business, operations, and cash flows in unforeseen ways.
Current wording
Geopolitical Matters - The conflict in the Middle East, which began in October 2023 and may continue to escalate, and the ongoing Russia-Ukraine war, could significantly impact global fertilizer and agriculture markets. These conflicts pose significant geopolitical risks to global markets, raise concerns of major implications, such as the enforcement of sanctions, and could disrupt the production and trade of fertilizer, grains, and feedstock through several means, such as trade restrictions. The ultimate outcome of these conflicts, or further escalation or expansion thereof, and any associated market disruptions are difficult to predict and may affect our business, operations, and cash flows in unforeseen ways.
Previous wording
The relationship between the total acres planted for both corn and soybeans has a direct impact on the overall demand for nitrogen products, as the market and demand for nitrogen increases with increased corn acres and decreases with increased soybean acres. Additionally, an estimated 13 billion pounds of soybean oil is expected to be used in producing cleaner renewable fuels in marketing year 2023/2024. Multiple refiners have announced renewable diesel expansion projects for 2024 and beyond, which should only increase the demand for soybeans and potentially for corn and canola.
Current wording
The relationship between the total acres planted for both corn and soybeans has a direct impact on the overall demand for nitrogen products, as the market and demand for nitrogen increases with increased corn acres and decreases with increased soybean acres. Additionally, an estimated 14 billion pounds of soybean oil is expected to be used in producing cleaner renewable fuels in marketing year 2024/2025. Multiple refiners have announced renewable diesel expansion projects for 2024 and beyond, which should only increase the demand for soybeans and potentially for corn and canola.
Previous wording
The United States Department of Agriculture (“USDA”) estimates that in spring 2024 farmers will plant 90.0 million corn acres, representing a decrease of 4.9% compared to 94.6 million corn acres in 2023. Planted soybean acres are estimated to be 86.5 million, representing an increase of 3.5% compared to 83.6 million soybean acres in 2023. The combined estimated corn and soybean planted acres of 176.5 million represents a decrease of 1.0% compared to the acreage planted in 2023. Due to lower input costs in 2024 for corn planting and the relative grain prices of corn versus soybeans, economics favored planting corn compared to soybeans in 2024. Inventory levels of corn and soybeans are expected to be supportive of grain prices for the remainder of 2024.
Current wording
The United States Department of Agriculture (“USDA”) estimates that in spring 2024 farmers will plant 91.5 million corn acres, representing a decrease of 3.3% compared to 94.6 million corn acres in 2023. Planted soybean acres are estimated to be 86.1 million, representing an increase of 3.0% compared to 83.6 million soybean acres in 2023. The combined estimated corn and soybean planted acres of 177.6 million represents a decrease of 0.4% compared to the acreage planted in 2023. Due to lower input costs in 2024 for corn planting and the relative grain prices of corn versus soybeans, economics favored planting corn compared to soybeans in 2024. Inventory levels of corn and soybeans are expected to be supportive of grain prices for the remainder of 2024.
Previous wording
Ethanol is blended with gasoline to meet renewable fuel standard requirements and for its octane value. Since 2010, ethanol production has historically consumed 38% of the U.S. corn crop used by the market, so demand for corn generally rises and falls with ethanol demand, as shown by the charts below, through March 31, 2024.
Current wording
Ethanol is blended with gasoline to meet requirements under the Renewable Fuel Standard of the Clean Air Act and for its octane value. Since 2010, ethanol production has historically consumed 38% of the U.S. corn crop used by the market, so demand for corn generally rises and falls with ethanol demand, as shown by the charts below, through June 30, 2024.
Previous wording
Fertilizer input costs have been volatile since the fall of 2021. Natural gas prices were elevated in the fall of 2022 due to shortages in Europe and demand being driven by building natural gas storage for winter. Winter 2022/2023 weather was warmer than average in Europe and, when combined with natural gas conservation measures, caused demand and prices for natural gas in Europe to fall significantly in the first quarter of 2023 and remain below the 2021/2022 price levels. The decline in natural gas prices, and the resulting capacity curtailments, among other factors, has led to a significant reduction in the price for nitrogen fertilizer from peak prices. While we expect that natural gas prices might remain below the elevated levels experienced in 2022 in the near term, we believe that the structural shortage of natural gas in Europe will continue to be a source of volatility for the rest of 2024 through 2026. Although pet coke prices elevated since 2021 due to higher natural gas prices compared to historical levels, as natural gas prices fell in 2023, third-party pet coke prices have declined into 2024.
Current wording
Fertilizer input costs have been volatile since the fall of 2021. Natural gas prices were elevated in the fall of 2022 due to shortages in Europe and demand being driven by building natural gas storage for winter. Winter 2022/2023 weather was warmer than average in Europe and, when combined with natural gas conservation measures, caused demand and prices for natural gas in Europe to fall significantly in the first quarter of 2023 and remain below the 2021/2022 price levels. The decline in natural gas prices, and the resulting capacity curtailments, among other factors, has led to a significant reduction in the price for nitrogen fertilizer from peak prices. While we expect that natural gas prices might remain below the elevated levels experienced in 2022 in the near term, we believe that the structural shortage of natural gas in Europe will continue to be a source of volatility for the rest of 2024 through 2026. Although pet coke prices have been elevated since 2021 due to higher natural gas prices compared to historical levels, as natural gas prices fell in 2023, third-party pet coke prices have declined into 2024.
Previous wording
The chart presented below summarizes our ammonia utilization rates on a consolidated basis for the three months ended March 31, 2024 and 2023. Utilization is an important measure used by management to assess operational output at each of the Partnership’s facilities. Utilization is calculated as actual tons of ammonia produced divided by capacity.
Current wording
The chart presented below summarizes our ammonia utilization rates on a consolidated basis for the three and six months ended June 30, 2024 and 2023. Utilization is an important measure used by management to assess operational output at each of the Partnership’s facilities. Utilization is calculated as actual tons of ammonia produced divided by capacity.
Previous wording
On a consolidated basis for the three months ended March 31, 2024, utilization decreased to 90% compared to 105% for the three months ended March 31, 2023. The decrease was primarily due to the 14-day planned downtime at the Coffeyville Facility in the current period.
Current wording
On a consolidated basis for the three months ended June 30, 2024, utilization increased to 102% compared to 100% for the three months ended June 30, 2023 due to the facilities operating largely as planned with reduced downtime compared to the prior period. For the six months ended June 30, 2024, utilization decreased to 96% compared to 103% for the six months ended June 30, 2023 primarily due to the 14-day planned outage at the Coffeyville Facility during the first quarter of 2024.
Previous wording
For the three months ended March 31, 2024 compared to the three months ended March 31, 2023, total product sales volumes were unfavorable, driven by reduced production volumes due to the 14-day planned downtime at the Coffeyville
Current wording
For the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023, total product sales volumes were unfavorable due to shifting more product sales into the first quarter of 2024 as weather was favorable for an early application during the second quarter of 2024 and reduced production volumes due to the 14-day planned outage at the Coffeyville Facility during the first quarter of 2024. For the three and six months ended June 30, 2024, total product sales prices were unfavorable driven by sales price decreases of 26% and 32%, respectively, for ammonia and 15% and 31%, respectively, for UAN. Ammonia and UAN sales prices were unfavorable primarily due to lower natural gas prices reducing input costs and driving an overall decrease in the market prices during the current period.
Previous wording
Production Volumes -Gross tons of ammonia represent the total ammonia produced, including ammonia produced that was upgraded into other fertilizer products. Net tons available for sale represents the ammonia available for sale that was not upgraded into other fertilizer products. The table below presents these metrics for the three months ended March 31, 2024 and 2023:
Current wording
Production Volumes -Gross tons of ammonia represent the total ammonia produced, including ammonia produced that was upgraded into other fertilizer products. Net tons available for sale represents the ammonia available for sale that was not upgraded into other fertilizer products. The table below presents these metrics for the three and six months ended June 30, 2024 and 2023:
Previous wording
Feedstock -Our Coffeyville Facility utilizes a pet coke gasification process to produce nitrogen fertilizer. Our East Dubuque Facility uses natural gas in its production of ammonia. The table below presents these feedstocks for both facilities for the three months ended March 31, 2024 and 2023:
Current wording
Feedstock -Our Coffeyville Facility utilizes a pet coke gasification process to produce nitrogen fertilizer. Our East Dubuque Facility uses natural gas in its production of ammonia. The table below presents these feedstocks for both facilities for the three and six months ended June 30, 2024 and 2023:
Previous wording
Financial Highlights for the Three Months Ended March 31, 2024 and 2023
Current wording
Financial Highlights for the Three and Six Months Ended June 30, 2024 and 2023
Previous wording
For the three months ended March 31, 2024, the Partnership’s operating income and net income were $20.1 million and $12.6 million, respectively, compared to operating income and net income of $109.4 million and $101.9 million, respectively, for the three months ended March 31, 2023. These decreases were primarily driven by decreased product sales prices due to lower natural gas prices, as well as lower UAN sales volumes due to the 14-day planned downtime at the Coffeyville Facility, partially offset by increased ammonia sales volumes due to favorable weather allowing for early application in the current period.
Current wording
For the three months ended June 30, 2024, the Partnership’s operating income and net income were $33.6 million and $26.2 million, respectively, compared to operating income and net income of $66.7 million and $59.9 million, respectively, for the three months ended June 30, 2023. For the six months ended June 30, 2024, the Partnership’s operating income and net income were $53.6 million and $38.8 million, respectively, compared to operating income and net income of $176.1 million and $161.7 million, respectively, for the six months ended June 30, 2023. These decreases were driven primarily by lower product sales prices attributable to natural gas prices reducing input costs and driving an overall decrease in the market prices.
Previous wording
Net Sales - For the three months ended March 31, 2024, net sales was $127.7 million compared to $226.3 million for the three months ended March 31, 2023. The decrease was primarily due to unfavorable UAN and ammonia sales prices resulting in reduced revenues of $79.1 million and unfavorable UAN sales volumes resulting in reduced revenues of $34.5 million, partially offset by favorable ammonia sales volumes contributing $24.5 million in higher revenues compared to the three months ended March 31, 2023.
Current wording
Net Sales - For the three months ended June 30, 2024, net sales was $132.9 million compared to $183.0 million for the three months ended June 30, 2023. The decrease was primarily due to unfavorable UAN and ammonia sales prices resulting in reduced revenues of $23.7 million and unfavorable ammonia sales volume contributing $25.6 million in lower revenue compared to the three months ended June 30, 2023.
Previous wording
The following table demonstrates the impact of changes in sales volumes and pricing for the primary components of net sales, excluding urea products, freight, and other revenue, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023:
Current wording
The following table demonstrates the impact of changes in sales volume and pricing for the primary components of net sales, excluding urea products, freight, and other revenue, for the three months ended June 30, 2024 compared to the three months ended June 30, 2023:
Previous wording
The $360 and $190 per ton decreases in ammonia and UAN sales pricing, respectively, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 were primarily attributable to natural gas prices reducing input costs and driving an overall decrease in the market prices, paired with increased global supplies of nitrogen fertilizer. The decreases in UAN sales volumes for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 were primarily attributable to the 14-day planned downtime at the Coffeyville Facility in the current period, partially offset by increases in ammonia sales volumes due to favorable weather allowing for early application in 2024.
Current wording
The $187 and $48 per ton decreases in ammonia and UAN sales pricing, respectively, for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 were primarily attributable to natural gas prices reducing input costs and driving an overall decrease in the market prices. The decrease in ammonia sales volume for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 was due to shifting more product into the first quarter as weather was favorable for an early application.
Previous wording
Cost of Materials and Other -For the three months ended March 31, 2024, cost of materials and other was $25.3 million compared to $36.6 million for the three months ended March 31, 2023. The decrease was driven primarily by lower natural gas and petroleum coke prices in the current period.
Current wording
Cost of Materials and Other -For the three and six months ended June 30, 2024, cost of materials and other was $26.1 million and $51.4 million, respectively, compared to $33.4 million and $70.0 million for the three and six months ended June 30, 2023, respectively. These decreases were driven primarily by lower natural gas and refinery pet coke prices in the current period.
Previous wording
Direct Operating Expenses (exclusive of depreciation and amortization) -For the three months ended March 31, 2024, direct operating expenses (exclusive of depreciation and amortization) were $55.7 million compared to $57.5 million for the three months ended March 31, 2023. The decrease was primarily a result of decreased utility costs from lower natural gas and electricity prices, partially offset by increased personnel costs and planned downtime at the Coffeyville Facility.
Current wording
Direct Operating Expenses (exclusive of depreciation and amortization) -For the three and six months ended June 30, 2024, direct operating expenses (exclusive of depreciation and amortization) were $46.9 million and $102.5 million, respectively, compared to $55.8 million and $113.3 million, respectively, for the three and six months ended June 30, 2023. These decreases were primarily a result of decreased utility costs from lower natural gas and electricity prices, partially offset by increased repairs and maintenance costs in the current period.
Previous wording
Depreciation and Amortization Expense- For the three months ended March 31, 2024, depreciation and amortization expense were $19.3 million compared to $15.2 million for the three months ended March 31, 2023. This increase was primarily due to additions to property, plant, and equipment during the current period coupled with fluctuations in depreciation capitalized to inventory and accelerated depreciation related to changes in the granular urea production that will retire assets earlier than their original expected useful lives.
Current wording
Depreciation and Amortization Expense- For the three and six months ended June 30, 2024, depreciation and amortization expense was $20.0 million and $39.3 million, respectively, compared to $19.8 million and $35.0 million for the three and six months ended June 30, 2023, respectively. While depreciation and amortization expense remained consistent during the three months ended June 30, 2024, the increase during the six months ended June 30, 2024 was primarily due to accelerated depreciation related to planned asset retirements, including granular plant production assets, and due to additions to property, plant, and equipment during the current period, partially offset by fluctuations in depreciation capitalized to inventory and retirement of fully depreciated assets.
Previous wording
Adjusted EBITDA- EBITDA adjusted for certain significant noncash items and items that management believes are not attributable to or indicative of our on-going operations or that may obscure our underlying results and trends.
Current wording
Adjusted EBITDA- EBITDA adjusted for certain significant noncash items and items that management believes are not attributable to or indicative of our underlying operational results of the period or that may obscure results and trends we deem useful.
Previous wording
(4)The Partnership declared and paid a cash distribution of $1.68 related to the fourth quarter of 2023 and declared a cash distribution of $1.92 per common unit related to the first quarter of 2024 to be paid in May 2024.
Current wording
(4)The Partnership declared and paid a $1.68 and $1.92 cash distribution related to the fourth quarter of 2023 and the first quarter of 2024, respectively, and declared a cash distribution of $1.90 per common unit related to the second quarter of 2024 to be paid in August 2024.
Previous wording
As of March 31, 2024, we had cash and cash equivalents of $64.6 million, and combined with $43.0 million available under our ABL Credit Facility, we had total liquidity of $107.6 million as of March 31, 2024. As of December 31, 2023, we had $45.3 million in cash and cash equivalents. Long-term debt consists of the following:
Current wording
As of June 30, 2024, we had cash and cash equivalents of $47.5 million, and combined with $50.0 million available under our ABL Credit Facility, we had total liquidity of $97.5 million as of June 30, 2024. As of December 31, 2023, we had $45.3 million in cash and cash equivalents. Long-term debt consisted of the following:
Previous wording
Our total capital expenditures for the three months ended March 31, 2024, along with our estimated expenditures for 2024 are as follows:
Current wording
Our total capital expenditures for the six months ended June 30, 2024, along with our estimated expenditures for 2024 are as follows:
Previous wording
We incurred nominal turnaround expenses during the three months ended March 31, 2024 and 2023, respectively. The next planned turnarounds are currently scheduled to take place in 2025 at the Coffeyville Facility and in 2026 at the East Dubuque Facility.
Current wording
The next planned turnarounds are currently scheduled to take place in 2025 at the Coffeyville Facility and in 2026 at the East Dubuque Facility.
Previous wording
For the first quarter of 2024, the Partnership, upon approval by the Board on April 29, 2024, declared a distribution of $1.92 per common unit, or $20.3 million, which is payable May 20, 2024 to unitholders of record as of May 13, 2024. Of this amount, CVR Energy will receive approximately $7.5 million, with the remaining amount payable to public unitholders.
Current wording
For the second quarter of 2024, the Partnership, upon approval by the Board on July 29, 2024, declared a distribution of $1.90 per common unit, or $20.1 million, which is payable August 19, 2024 to unitholders of record as of August 12, 2024. Of this amount, CVR Energy will receive approximately $7.4 million, with the remaining amount payable to public unitholders.
Previous wording
The change in net cash flows from operating activities for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 is primarily due to a $89.3 million decrease in net income during 2024 due to lower product sales prices and sales volumes. In addition, there was a decrease in working capital of $2.1 million attributable to decreases in accounts receivable and deferred revenue, partially offset by increases in inventories and accounts payable. These decreases were partially offset by an increase in depreciation and amortization of $4.1 million as a result of additions to property, plant, and equipment during the current period coupled with fluctuations in depreciation capitalized to inventory and accelerated depreciation related to changes in the granular urea production that will retire assets earlier than their original expected useful lives.
Current wording
The change in net cash flows from operating activities for the six months ended June 30, 2024 compared to the six months ended June 30, 2023 is primarily due to decreases of $122.9 million in net income and $18.7 million in working capital during 2024 due to lower product sales prices and sales volumes.
Previous wording
The change in net cash flows from investing activities for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 was due to a decrease in distributions received from CVR Partners’ equity method investment of $16.2 million associated with the 45Q Transaction in 2024 and an increase in capital expenditures of $4.7 million during 2024 resulting from an increase in various capital projects in the current period compared to 2023.
Current wording
The change in net cash flows from investing activities for the six months ended June 30, 2024 compared to the six months ended June 30, 2023 was due to a decrease in distributions received from CVR Partners’ equity method investment of $16.4 million associated with the 45Q Transaction in 2024 and an increase in capital expenditures of $6.7 million during 2024 resulting from an increase in various capital projects in the current period compared to 2023.
Previous wording
The change in net cash flows from financing activities for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 was due to a decrease in cash distributions paid of $93.2 million in 2024 compared to 2023.
Current wording
The change in net cash flows from financing activities for the six months ended June 30, 2024 compared to the six months ended June 30, 2023 was due to a decrease in cash distributions paid of $183.2 million in 2024 compared to 2023.
Previous wording
Our critical accounting estimates are disclosed in the “Critical Accounting Estimates” section of our 2023 Form 10-K. No modifications have been made during the three months ended March 31, 2024 to these estimates.
Current wording
Our critical accounting estimates are disclosed in the “Critical Accounting Estimates” section of our 2023 Form 10-K. No modifications have been made during the three and six months ended June 30, 2024 to these estimates.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
Operating Highlights for the Six Months Ended June 30, 2024 versus June 30, 2023
Current report — wording carried from elsewhere
The following table demonstrates the impact of changes in sales volume and pricing for the primary components of net sales, excluding urea products, freight, and other revenue, for the six months ended June 30, 2024 as compared to the six months ended June 30, 2023:
Current report — wording carried from elsewhere
The $245 and $122 per ton decreases in ammonia and UAN sales pricing, respectively, for the six months ended June 30, 2024 compared to the six months ended June 30, 2023 were primarily attributable to natural gas prices reducing input costs and driving an overall decrease in the market prices, paired with increased global supplies of nitrogen fertilizer. The decreases in
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Facility. For the three months ended March 31, 2024, total product sales prices were unfavorable, driven by sales price decreases of 41% for ammonia and 42% for UAN. Ammonia and UAN sales prices were unfavorable primarily due to lower natural gas prices reducing input costs and driving an overall decrease in the market prices and increased global supplies of nitrogen fertilizer.