Boston, MA 10/03/2014 (wallstreetpr) – According to reports, Rentech Nitrogen Partners LP (NYSE:RNF) has decided to implement plans to make certain changes and restructure the entire Pasadena Facility. The announcement was made by the company itself saying that it had started operations required to restructure Pasadena, Texas facility. The main reason behind restructuring this facility is nothing but to improve profitability in current market conditions which are not favorable for RNF.
Road Ahead:
Rentech Nitrogen Partners LP (NYSE:RNF) expects that if everything goes fine, then the restructuring work will get over by the end of this year. Analysts have predicted that annualized cash savings of FNF in next year will be around $10 million. Experts think that the restructuring work will result into reduction and SG&A and operating expenses by as much as $6 million. Apart from these expenses, the proposed restructuring will also decrease annual maintenance capital expenditure by $4 million. The company has not been able to generate a sound EBITDA in the near past, but with the help of this restructuring work to generate positive EBITDA in next year. The main focus will be on power generation operations of the company, which have not generated good revenues in the past.
If the restructuring work gets executed, then full-time equivalents like employees and contractors will be reduced by 20% minimum. Apart from them, severance and a few other one-time employee-related expenditures which amount close to $0.5 million in the current year, will also reduce significantly. As part of the restructuring process, Rentech Nitrogen Partners LP (NYSE:RNF) will reduce the production of ammonium sulfate by close to 25% to 500,000 tons. The most preferred target audience for sale of it is India. As per the information, 70% of 500,000 tons will be sold in the domestic market while reset will be sent to Australia and New Zealand. These two markets offer highest prices for ammonium sulfate in the world.
