Overview

• LSB Q2 net sales rise to $151.3 mln but miss analyst expectations as per LSEG data

• Net income falls to $3.0 mln from $9.6 mln year-over-year

• Adjusted EBITDA declines to $38.3 mln due to higher natural gas costs

Outlook

• Company expects gas costs to be less of a headwind in Q3

• LSB sees robust demand for nitric acid and ammonium nitrate

• UAN pricing strengthened due to tight U.S. supply fundamentals

• Low carbon project expected operational by end of 2026

Result Drivers

• SALES VOLUME INCREASE - 6% year-over-year increase in sales volumes driven by improved ammonia production and higher margin upgraded products, per CEO Mark Behrman

• HIGHER NATURAL GAS COSTS - Materially higher natural gas prices offset gains from increased sales volumes and higher UAN selling prices, impacting operating income and adjusted EBITDA

• FAVORABLE DEMAND - Robust demand in end markets, with tight inventories and global supply disruptions boosting UAN pricing and sales volumes for nitric acid and ammonium nitrate

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 2 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the diversified chemicals peer group is "buy"

• Wall Street's median 12-month price target for LSB Industries Inc is $9.00, about 4% above its July 28 closing price of $8.64

• The stock recently traded at 30 times the next 12-month earnings vs. a P/E of 19 three months ago

Press Release: ID:nBw9HSS8Pa

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)