STAMFORD, Conn., April 17, 2020 /PRNewswire/ -- Tronox
Holdings plc (NYSE:TROX) ("Tronox" or the "Company"), the world's
leading integrated manufacturer of titanium dioxide pigment, today
released selected preliminary unaudited financial results for the
quarter ending March 31, 2020 and
provided an update on its business.
First Quarter 2020 Highlights:
- Revenue expected to be $722
million(1)
- Adjusted EBITDA expected to be $172
million(1)(2) (Non-GAAP)
- Adjusted EPS expected to be between $0.20 and $0.26(1)(2) (Non-GAAP)
- Solid balance sheet and broad flexibility to manage cash
flows
(1)
|
Note: The
information is preliminary, based upon information available as of
today and is subject to change and finalization following the
completion of adjustments associated with purchase accounting and
taxes, as well as management's disclosure controls
process.
|
(2)
|
Refer to the
tables at the end of this press release for a reconciliation to net
income.
|
Jeffry N. Quinn, Chairman and
Chief Executive Officer of Tronox commented, "I am very pleased
with Tronox's strong first quarter 2020 results, which came in
above consensus and our previously issued guidance despite the
onset of the COVID-19 pandemic in the latter part of the
quarter. We expect first quarter revenue of $722 million, in-line with first quarter 2019
revenue pro forma for the Cristal transaction, and Adjusted EBITDA
of $172 million, an increase of 22
percent over first quarter 2019 pro forma Adjusted EBITDA of
$141 million. We expect
Adjusted EPS to be between $0.20 and
$0.26. We will report our full
financial results as planned in early May.
"We continue to prioritize the safety, health and well-being of
our employees and their families while preserving and protecting
our business. Our operations have been designated as
essential to support the continued manufacturing of products such
as food and medical packaging, medical equipment, pharmaceuticals,
and personal protective gear. All of our sites are currently
running to planned production levels, excluding South Africa where we elected to leverage our
inventories on hand and not operate our mines and concentrators and
run our smelters at a near-full rate with a reduced workforce
through the initial 21-day countrywide lockdown period. In
the coming days, we expect to restart our mines and
concentrators.
"Our balanced geographic sales, vertically integrated business
model with operations across six continents and integrated business
planning capabilities enable us to rapidly respond to changing
regional market conditions. Demand for TiO2 in
North America has been the most
resilient, as we benefit from our exposure to do-it-yourself
coatings and packaging applications. Regions hit hardest by
the virus have experienced lower than normal demand, but we are
seeing signs of certain markets picking back up in areas within
Europe. Asia Pacific remains
mixed, with China continuing to
show strength, while we continue to monitor the developments in
countries such as India. Based on our current forward order
book, we expect our TiO2 volumes in the second quarter
to be only 4-7 percent below the volumes we achieved in the first
quarter, which were up 7 percent from the fourth quarter last
year. We are monitoring the changing market conditions daily
but continue to believe that Tronox is well positioned to meet the
challenges of the current situation. Zircon demand remains
mixed, with demand recovering in China offset by weaker demand in Europe.
Zircon volumes for the first quarter were in-line with fourth
quarter 2019 volumes.
"Our balance sheet is strong. As of March 31, 2020, our total available liquidity was
$570 million, including $419 million in cash and cash equivalents and
$151 million available under
revolving credit agreements including $123
million available under our ABL facility. Our total
debt was $3.2 billion and net debt to
trailing-twelve month Adjusted EBITDA pro forma for the Cristal
transaction was 3.9x. There are no upcoming maturities on the
Company's term loan or bonds until 2024. The Company also has
no financial covenants on its term loan or bonds and only one
springing financial covenant on its ABL facility, which we do not
expect to be triggered in any scenario.
"We are proactively managing our cash flow through cost
reductions, harvesting of working capital, and reducing capital
expenditures by at least $50
million. We have ample levers available to ensure
sufficient cash across a wide range of economic scenarios.
"We continue to run our operations according to plan with the
ability to adjust accordingly to address shifting
circumstances. Our unique integrated business planning
capabilities enable us to optimize our business at each step of our
value chain. We are working diligently across our global
network to operate safely and supply our customers and ensure we
are prepared to fully participate in the economic recovery to
come."
Mr. Quinn concluded, "One week ago today, we celebrated the
one-year anniversary of the closing of the Cristal
acquisition. A year ago, we did not anticipate the
circumstances we are facing today; however, we are finding that as
a combined company, the New Tronox is far more resilient and able
to weather the storm with substantially more flexibility and
strength, providing us the ability to continue executing on our
strategy to enhance our position as the leading vertically
integrated TiO2 producer."
First Quarter 2020 Earnings Release and Webcast Conference
Call
Tronox will report full financial results for the first quarter
2020 on Wednesday, May 6, 2020 and
will conduct a webcast conference call on Thursday, May 7, 2020 at 8:30 a.m. ET (New
York), the details of which are included
below.
Earnings Release: Wednesday, May
6, 2020, after the market close via PR Newswire and the
Tronox Holdings plc website: Tronox.com
Webcast Conference Call: Thursday,
May 7, 2020, at 8:30 a.m. ET
(New York). The live call is
open to the public via internet broadcast and telephone.
Internet Broadcast: Tronox.com
Dial-in Telephone Numbers:
U.S. / Canada: +1.877.831.3840
International: +1.224.633.1393
Conference ID: 9961929
Conference Call Presentation Slides will be used during
the conference call and will be available on our website:
Tronox.com
Conference Call Replay: Available via the internet
and telephone beginning on May 7,
2020, 11:30 a.m. ET
(New York), until May 14, 2020, 11:30 a.m.
ET (New York)
Internet Replay: Tronox.com
Replay Dial-in Telephone Numbers:
U.S. / Canada: +1.855.859.2056
International: +1.404.537.3406
Conference ID: 9961929
About Tronox
Tronox Holdings plc is one of the world's leading producers of
high-quality titanium products, including titanium dioxide pigment,
specialty-grade titanium dioxide products and high-purity titanium
chemicals; and zircon. We mine titanium-bearing mineral sands and
operate upgrading facilities that produce high-grade titanium
feedstock materials, pig iron and other minerals. With nearly 7,000
employees across six continents, our rich diversity, unmatched
vertical integration model, and unparalleled operational and
technical expertise across the value chain
position Tronox as the preeminent titanium dioxide
producer in the world. For more information about how our products
add brightness and durability to paints, plastics, paper and other
everyday products, visit Tronox.com.
Forward Looking Statements
Statements in this release that are not historical are
forward-looking statements within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995. These forward-looking
statements, which are subject to known and unknown risks,
uncertainties and assumptions about us, may include projections of
our future financial performance including the effects of the
COVID-19 pandemic and anticipated synergies based on our growth and
other strategies and anticipated trends in our business. These
statements are only predictions based on our current expectations
and projections about future events. There are important factors
that could cause our actual results, level of activity,
performance, actual synergies, or achievements to differ materially
from the results, level of activity, performance, anticipated
synergies or achievements expressed or implied by the
forward-looking statements. Significant risks and uncertainties may
relate to, but are not limited to, business and market disruptions
related to the COVID-19 pandemic, market conditions and price
volatility for titanium dioxide, zircon and other feedstock
materials, as well as global and regional economic downturns,
including as a result of the COVID-19 pandemic, that adversely
affect the demand for our end-use products; disruptions in
production at our mining and manufacturing facilities; and other
financial, economic, competitive, environmental, political, legal
and regulatory factors. These and other risk factors are discussed
in the Company's filings with the Securities and Exchange
Commission (SEC).
Moreover, we operate in a very competitive and rapidly changing
environment. New risks and uncertainties emerge from time to time,
and it is not possible for our management to predict all risks and
uncertainties, nor can management assess the impact of all factors
on our business or the extent to which any factor, or combination
of factors, may cause actual results to differ materially from
those contained in any forward-looking statements. Although we
believe the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results,
level of activity, performance, synergies or achievements. Neither
we nor any other person assumes responsibility for the accuracy or
completeness of any of these forward-looking statements. You should
not rely upon forward-looking statements as predictions of future
events. Unless otherwise required by applicable laws, we undertake
no obligation to update or revise any forward-looking statements,
whether because of new information or future developments.
Use of Non-U.S. GAAP Financial Information
To provide investors and others with additional information
regarding the financial results of Tronox Holdings plc, we have
disclosed in this press release certain non-U.S. GAAP operating
performance measures of Adjusted EBITDA and Adjusted EPS.
These non-U.S. GAAP financial measures are a supplement to and not
a substitute for or superior to, the Company's results presented in
accordance with U.S. GAAP. The non-U.S. GAAP financial
measures presented by the Company may be different from non-U.S.
GAAP financial measures presented by other companies. The Company
believes the non-U.S. GAAP information provides useful measures to
investors regarding the Company's financial performance by
excluding certain costs and expenses that the Company believes are
not indicative of its core operating results. The
presentation of these non-U.S. GAAP financial measures is not meant
to be considered in isolation or as a substitute for results or
guidance prepared and presented in accordance with U.S.
GAAP.
Media Contact: Melissa Zona
+1.636.751.4057
Investor Contact: Jennifer
Guenther
+1.646.960.6598
TRONOX HOLDINGS
PLC
|
RECONCILIATION OF
PRELIMINARY NET INCOME FROM CONTINUING OPERATIONS (US GAAP) TO
EBITDA AND ADJUSTED EBITDA (NON-U.S. GAAP)
|
(UNAUDITED)
|
(Millions of U.S.
dollars)
|
|
|
|
|
|
Three Months
Ended March 31, 2020
|
|
|
Preliminary net
income from continuing operations (U.S. GAAP) (a)
|
$
34
|
Interest
expense
|
45
|
Interest
income
|
(3)
|
Income tax provision
(a)
|
8
|
Depreciation,
depletion and amortization expense (a)
|
75
|
EBITDA (non-U.S.
GAAP)
|
159
|
Share-based
compensation (b)
|
9
|
Restructuring
(c)
|
2
|
Integration Costs
(d)
|
6
|
Foreign currency
remeasurement (e)
|
(12)
|
Other items
(f)
|
8
|
Adjusted EBITDA
(non-U.S. GAAP)
|
$ 172
|
|
(a) Preliminary net
income from continuing operations is subject to change as we
finalize our Disclosure & Controls processes and complete our
purchase accounting and tax provision analyses.
(b) Represents non-cash share-based compensation.
(c) Represents amounts for employee-related costs, including
severance.
(d) Represents integration costs associated with the Cristal
acquisition which were recorded in "Selling, general and
administrative expenses".
(e) Represents realized and unrealized gains and losses associated
with foreign currency remeasurement related to third-party and
intercompany receivables and liabilities denominated in a currency
other than the functional currency of the entity holding them, net
of the change in value of any associated derivative instruments,
which are included in "Other expense, net".
(f) Includes noncash asset writeoffs, pension and postretirement
costs, accretion expense and other items included in "Selling
general and administrative expenses", "Cost of goods sold" and
"Other income (expense), net".
|
TRONOX HOLDINGS
PLC
|
RECONCILIATION OF
NON-U.S. GAAP FINANCIAL MEASURES
|
(UNAUDITED)
|
(Millions of U.S.
dollars, except share and per share data)
|
|
RECONCILIATION OF
PRELIMINARY NET INCOME FROM CONTINUING OPERATIONS
|
ATTRIBUTABLE TO
TRONOX HOLDINGS PLC (U.S. GAAP)
|
TO ADJUSTED NET
INCOME FROM CONTINUING OPERATIONS
|
ATTRIBUTABLE TO
TRONOX HOLDINGS PLC (NON-U.S. GAAP)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31, 2020
|
|
|
Low
End
|
|
High
End
|
|
|
|
|
|
Preliminary net
income from continuing operations attributable to Tronox Holdings
plc (U.S. GAAP) (a)
|
|
$
20
|
|
$
28
|
Restructuring
(b)
|
|
2
|
|
2
|
Integration costs
(c)
|
|
6
|
|
6
|
Other
|
|
1
|
|
1
|
Adjusted net income
from continuing operations attributable to Tronox Holdings plc
(non-U.S. GAAP)
|
|
$
29
|
|
$
37
|
|
|
|
|
|
Diluted net income
per share from continuing operations (U.S. GAAP)
|
|
$
0.14
|
|
$
0.19
|
|
|
|
|
|
Restructuring, per
share
|
|
0.01
|
|
0.01
|
Integration costs,
per share
|
|
0.04
|
|
0.04
|
Other
|
|
0.01
|
|
0.01
|
Diluted adjusted net
income from continuing operations per share attributable to Tronox
Holdings plc (non-U.S. GAAP)
|
|
$
0.20
|
|
$
0.26
|
|
|
|
|
|
Weighted average
shares outstanding, diluted (in thousands)
|
|
143,596
|
|
143,596
|
|
(a) Preliminary net
income from continuing operations attributable to Tronox is subject
to change as we finalize our Disclosure & Controls processes
and complete our purchase accounting and tax provision
analyses.
(b) Represents amounts for employee-related costs, including
severance, net of tax.
(c) Represents integration costs associated with the Cristal
acquisition after the acquisition which were recorded in "Selling,
general and administrative expenses".
|
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SOURCE Tronox Holdings plc