STAMFORD, Conn., May 9, 2019 /PRNewswire/ --
First Quarter 2019 Highlights:
- Revenue of $390 million down 12
percent versus first quarter 2018; down 9 percent excluding
$12 million of revenue in prior-year
quarter from Electrolytic business sold in September 2018; primary drivers were 10 percent
lower pigment sales volumes and $6
million of unfavorable Euro translation
- Revenue down 9 percent versus fourth quarter 2018, as higher
pigment sales volumes were more than offset by lower zircon,
feedstock and pig iron sales volumes due to shipment timing
- Income from operations of $16
million; Adjusted EBITDA of $80
million (Non-GAAP) reflected transitioning TiO2
pigment market conditions that improved as the quarter was
completed and the financial impact of certain actions taken in
operations in preparation for moving from a long to short feedstock
position following the closing of the Cristal acquisition
- For the second quarter 2019, Adjusted EBITDA (Non-GAAP) of
$125 million to $135 million expected for legacy Tronox driven by
improved pigment market conditions, increased zircon shipments and
the margin benefits of the actions taken in operations prior to
closing the Cristal acquisition (1)
- GAAP diluted loss per share ($0.27); adjusted diluted loss per share of
($0.18) (Non-GAAP)
- Continued to successfully work with our pigment customers on
margin stability initiatives; TiO2 pigment selling
prices 2 percent lower than prior-year quarter and 1 percent lower
than prior quarter on local currency basis
Strategic Developments:
- Transformational acquisition of Cristal
TiO2 business completed on April 10, 2019
- Sale of Cristal's former North American TiO2
business to INEOS Enterprises for $700
million closed on May 1, 2019
and divestiture of 8120 paper laminate grade to Venator Materials
closed on April 26, 2019
- Repurchased 14 million Tronox shares directly from Exxaro
Resources at a price of $14.32 per
share on May 9, 2019, using portion
of proceeds from INEOS transaction
|
|
|
|
1)
|
For the Company's
guidance with respect to second quarter 2019 Adjusted EBITDA, we
are not able to provide without unreasonable effort the most
directly comparable GAAP financial measure, or reconciliation to
such GAAP financial measure, because certain items that impact such
measure are uncertain or out of our control, or cannot be
reasonable predicted.
|
Tronox Holdings plc (NYSE:TROX) ("Tronox" or the "Company"), the
world's leading integrated manufacturer of titanium dioxide
pigment, reported revenue of $390
million for the first quarter 2019, down 12 percent from
$442 million in the prior-year
quarter and down 9 percent from $429
million in the prior quarter. Excluding revenue of
$12 million in the year-ago quarter
from the Electrolytic business sold in September 2018, revenue declined 9 percent versus
the prior-year quarter. Income from operations of
$16 million compared to $14 million in the year-ago quarter and
$68 million in the prior
quarter. Net loss attributable to Tronox of $34 million, or ($0.27) per diluted share, compared to a net loss
attributable to Tronox of $44
million, or ($0.36) per
diluted share, in the year-ago quarter and a net loss attributable
to Tronox of $5 million, or
($0.05) per diluted share in the
prior quarter. Net loss attributable to Tronox in the first
quarter 2019 included transaction costs primarily related to the
Cristal acquisition, debt modification costs and a charge to
indemnify Exxaro Resources for capital gains tax pursuant to the
Mineral Sands Completion Agreement that, combined, totaled
$11 million or $0.09 per diluted share. Excluding these
items, adjusted net loss attributable to Tronox (Non-GAAP) was
$23 million, or ($0.18) per diluted share. Adjusted EBITDA
of $80 million compared to
$117 million in the prior-year
quarter and $120 million in the prior
quarter.
The Board of Directors declared a quarterly dividend
of $0.045 per share payable on May 31, 2019, to
shareholders of record of the company's ordinary shares at the
close of business on May 20, 2019.
Jeffry Quinn, chairman and chief
executive officer of Tronox commented on the recent developments by
noting, "The closing of the game-changing Cristal acquisition comes
at an opportune time, as pigment markets in Europe and Asia are stabilizing, inventories are
normalizing as destocking runs its course, and North American
market conditions remain resilient. We continue to successfully
work with our pigment customers on our unique win-win margin
stability initiative and now with the closing of the Cristal
transaction, we will accelerate our work on this important
initiative."
Discussing the unique positioning of Tronox as an integrated
pigment producer in favorable feedstock conditions, Quinn stated,
"Furthermore, we are in an advantaged position to benefit from both
zircon and feedstock integration. We expect zircon to continue to
deliver significant profitability and margin enhancement," Quinn
continued, "and we expect to fully derive the benefits of vertical
integration in future quarters that were substantially muted in the
first quarter."
Finally, because of these positive developments, Quinn stated,
"For the second quarter of 2019, we expect Adjusted EBITDA
(Non-GAAP) to range between $125
million to $135 million for
legacy Tronox, a substantial increase from the first quarter."
First Quarter 2019
First Quarter 2019 versus First Quarter 2018
Revenue of $390 million was 12
percent lower than $442 million in
the year-ago quarter primarily due to lower pigment sales volumes,
the absence of revenue from the Electrolytic business sold in
September 2018 and unfavorable Euro
translation, partially offset by higher zircon selling
prices. Revenue was 9 percent lower excluding $12 million of revenue from the Electrolytic
business in the prior-year quarter.
Pigment sales of $286 million
compared to $333 million in the
year-ago quarter. Sales volumes were 10 percent lower as
customer destocking in Europe and
Asia continued in the first
quarter. Selling prices were 2 percent lower on a local
currency basis and 5 percent lower on a U.S. dollar basis, as
translation of the Euro was a $6
million headwind on revenue.
Titanium feedstock and co-products sales of $104 million increased 7 percent from
$97 million in the year-ago
quarter. Zircon sales of $64
million increased 5 percent from $61
million in the year-ago quarter driven by 17 percent higher
selling prices, partially offset by 10 percent lower sales volumes
due to the timing of shipments. Pig iron sales of
$19 million were level to the
year-ago quarter, as 2 percent higher selling prices were offset by
2 percent lower sales volumes. Feedstock and other products
sales of $21 million increased from
$17 million in the year-ago quarter
primarily driven by higher synthetic rutile and slag fines sales
volumes. There were no ilmenite sales in the first quarter
compared to $5 million in the
year-ago quarter, as we were not actively selling ilmenite in the
market in preparation for increased internal requirements following
the closing of the Cristal acquisition.
Adjusted EBITDA of $80 million was
32 percent lower than $117 million in
the year-ago quarter. Higher zircon selling prices and
favorable foreign exchange on costs were more than offset by lower
pigment and zircon sales volumes, unfavorable overhead absorption
related to planned maintenance in South
Africa, higher costs for coke, electrodes, anthracite and
labor, higher one-time SG&A costs associated with
re-domiciliation and other initiatives, and a $9 million royalty refund received in the
year-ago quarter.
First Quarter 2019 versus Fourth Quarter 2018
Revenue of $390 million decreased
9 percent from $429 million in the
prior quarter, as higher pigment sales volumes were more than
offset by lower sales volumes for feedstock, zircon and pig iron
due to the timing of shipments.
Pigment sales of $286 million
increased 9 percent from $263 million
in the prior quarter. Sales volumes increased 10 percent
driven by the normal seasonal increase coupled with positive
momentum in March in European and Asian markets as destocking runs
its course. Selling prices were 1 percent lower on a local
currency basis and 2 percent lower on a U.S. dollar basis.
The impact of translation of the Euro on pigment sales was
negligible compared to the prior quarter.
Titanium feedstock and co-products sales of $104 million decreased 37 percent from
$166 million in the prior quarter,
driven by lower sales volumes for CP slag, zircon and pig iron due
to the timing of shipments. Zircon sales of $64 million were 22 percent lower than
$82 million in the prior quarter, as
3 percent higher selling prices were more than offset by a 24
percent decline in sales volumes due to shipment timing. Pig
iron sales of $19 million decreased
24 percent from $25 million in the
prior quarter on 24 percent lower sales volumes, also due to
shipment timing, while selling prices were level. Feedstock
and other products sales of $21
million decreased 64 percent from $59
million in the prior quarter. There were no ilmenite
sales in the current or prior quarter, and there were no CP slag
sales in the current quarter in preparation for increased internal
requirements following the closing of the Cristal acquisition,
compared to $29 million of sales in
the prior quarter.
Adjusted EBITDA of $80 million was
33 percent lower than $120 million in
the prior quarter, driven primarily by lower sales volumes for
feedstock and zircon due to shipment timing, unfavorable foreign
exchange on costs and higher pigment unit costs related to planned
maintenance undertaken in the fourth quarter 2018 that reduced
margins on pigment products sold in the first quarter.
Other Financial Information
Selling, general and administrative expenses were $67 million compared to $76 million in the year-ago quarter and
$50 million in the prior
quarter. Selling, general and administrative expenses
primarily attributable to the Cristal acquisition were $8 million in the first quarter 2019 compared to
$20 million in the year-ago quarter
and $7 million in the prior
quarter. Interest expense of $49
million was level to the year-ago quarter and prior
quarter. On March 31, 2019,
debt was $3,375 million and debt, net
of cash and cash equivalents, was $1,641
million, including $666
million of cash restricted for the Cristal
transaction. Liquidity was $1,947
million comprised of cash and cash equivalents of
$1,734 million, including
$666 million of restricted cash, and
$213 million available under
revolving credit agreements. In the first quarter 2019,
capital expenditures were $25 million
and depreciation, depletion and amortization expense was
$47 million.
Webcast Conference Call
Tronox will conduct a webcast conference call on Friday, May 10, 2019, 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: +1.253.237.1184
Conference ID: 3492939
Conference Call Presentation Slides will be used during
the conference call and are available on our website:
tronox.com
Conference Call Replay: Available via the internet and
telephone beginning on May 10, 2019,
1:30 p.m. ET (New York), until May
16, 2019, 11:59 p.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: 3492939
Upcoming Conferences and Investor Meetings
During the second quarter of 2019 a member of management is
scheduled to present at the following conferences:
- Tronox Investor Conference, New
York, May 30, 2019
- Deutsche Bank Global Industrial & Materials Summit,
Chicago, June 6, 2019
- Barclays High Yield Conference, Colorado Springs, CO, June 6-7, 2019
- Vertical Research Partners Materials Conference, New York, June 18,
2019
- Citi Leveraged Finance Conference, Park City, UT, June
19-21, 2019
- BMO Capital Markets Chemicals & Materials Conference,
New York, June 27, 2019
Accompanying conference and meeting materials will be available
at http://investor.tronox.com
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 based on our growth 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 or achievements to
differ materially from the results, level of activity, performance
or achievements expressed or implied by the forward-looking
statements. These and other risk factors are discussed in the
company's filings with the Securities and Exchange
Commission (SEC), including those under the heading entitled
"Risk Factors" in our Annual Report on Form 10-K/A for the year
ended December 31, 2018.
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 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 EBITDA, Adjusted EBITDA, Adjusted EBITDA
margin and Adjusted net loss attributable to Tronox and a non-U.S.
GAAP liquidity measure of Free Cash Flow. 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. Specifically, 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. With these first quarter of 2019
results, we have modified our definition of the Adjusted EBITDA
metric to now exclude all realized and unrealized gains and losses
caused by foreign currency re-measurement to be more consistent
with how we report this metric to our lenders. We have
revised the comparable periods for consistency. 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.
A reconciliation of the non-U.S. GAAP financial measures to U.S.
GAAP results is included herein.
For the Company's guidance with respect to second quarter 2019
Adjusted EBITDA, we are not able to provide without unreasonable
effort the most directly comparable GAAP financial measure, or
reconciliation to such GAAP financial measure, because certain
items that impact such measure are uncertain or out of our control,
or cannot be reasonably predicted.
Management believes these non-U.S. GAAP financial measures:
- Reflect the ongoing business of Tronox Holdings plc in a manner
that allows for meaningful period-to-period comparison and analysis
of trends in its business, as they exclude income and expense that
are not reflective of ongoing operating results;
- Provide useful information to investors and others in
understanding and evaluating the operating results and future
prospects of Tronox Holdings plc;
- Provide an additional view of the operating performance of the
company by adding interest expense & income, income taxes,
depreciation, depletion and amortization to the net income. Further
adjustments due to gain (loss) on extinguishment of debt,
stock-based compensation charges, transaction costs associated with
acquisitions, foreign currency re-measurements, impairments,
settlements of pension and postretirement plans, impacts of tax
settlements on non-income related taxes, severance expense, and
noncash pension and postretirement expense and accretion expense
are made to exclude items that are either non-cash or unusual in
nature;
- Adjusted EBITDA is one of the primary measures management uses
for planning and budgeting processes and to monitor and evaluate
financial and operating results. Adjusted EBITDA is not a
recognized term under U.S. GAAP and does not purport to be an
alternative to measures of our financial performance as determined
in accordance with U.S. GAAP, such as net income (loss). Because
other companies may calculate EBITDA and Adjusted EBITDA
differently than Tronox, EBITDA may not be, and Adjusted EBITDA as
presented in this release is not, comparable to similarly titled
measures reported by other companies, and
- We believe that the non-U.S. GAAP financial measure "Adjusted
net income (loss) attributable to Tronox Holdings plc" and its
presentation on a per share basis provide useful information about
our operating results to investors and securities analysts. We also
believe that excluding the effects of these items from operating
results allows management and investors to compare more easily the
financial performance of our underlying businesses from period to
period.
Media Contact: Melissa Zona
+1.636.751.4057
Investor Contact: Brennen
Arndt
+1.646.960.6598
TRONOX HOLDINGS
PLC
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS (U.S. GAAP)
|
(UNAUDITED)
|
(Millions of U.S.
dollars, except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
|
|
|
2019
|
|
2018
|
|
Net
sales
|
|
$
390
|
|
$
442
|
|
Cost of goods
sold
|
|
307
|
|
327
|
|
Gross
profit
|
|
83
|
|
115
|
|
Selling, general, and
administrative expenses
|
|
67
|
|
76
|
|
Impairment
loss
|
|
-
|
|
25
|
|
Income from
operations
|
|
16
|
|
14
|
|
Interest
expense
|
|
(49)
|
|
(49)
|
|
Interest
income
|
|
9
|
|
8
|
|
Loss on
extinguishment of debt
|
|
(2)
|
|
-
|
|
Other expense,
net
|
|
(2)
|
|
(9)
|
|
Loss before income
taxes
|
|
(28)
|
|
(36)
|
|
Income tax
provision
|
|
(2)
|
|
(5)
|
|
Net
loss
|
|
(30)
|
|
(41)
|
|
Net income
attributable to noncontrolling interest
|
|
4
|
|
3
|
|
Net loss
attributable to Tronox Holdings plc
|
|
$
(34)
|
|
$
(44)
|
|
|
|
|
|
|
|
|
Net loss per
share, basic and diluted
|
|
$
(0.27)
|
|
$
(0.36)
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding, basic and diluted (in thousands)
|
|
124,296
|
|
122,327
|
|
|
|
|
|
|
|
|
Other Operating
Data:
|
|
|
|
|
|
|
Capital
expenditures
|
|
$
25
|
|
$
28
|
|
|
Depreciation,
depletion and amortization expense
|
|
$
47
|
|
$
48
|
|
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
NET LOSS
|
ATTRIBUTABLE TO
TRONOX HOLDINGS PLC (U.S. GAAP)
|
TO ADJUSTED NET
INCOME (LOSS) FROM OPERATIONS
|
ATTRIBUTABLE TO
TRONOX HOLDINGS PLC (NON-U.S. GAAP)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
|
2019
|
|
2018
|
|
|
|
|
|
Net loss attributable
to Tronox Holdings plc (U.S. GAAP)
|
|
$
(34)
|
|
$
(44)
|
Impairment loss
(a)
|
|
-
|
|
25
|
Transaction costs
(b)
|
|
8
|
|
20
|
Loss on
extinguishment of debt (c)
|
|
2
|
|
-
|
Charge for potential
capital gains tax payment to Exxaro (d)
|
|
1
|
|
-
|
Adjusted net (loss)
income attributable to Tronox Holdings plc (non-U.S.
GAAP)
|
|
$
(23)
|
|
$
1
|
|
|
|
|
|
Diluted net loss per
share (U.S. GAAP)
|
|
$
(0.27)
|
|
$
(0.36)
|
|
|
|
|
|
Impairment loss, per
share
|
|
-
|
|
0.21
|
Transaction costs,
per share
|
|
0.06
|
|
0.16
|
Loss on
extinguishment of debt, per share
|
|
0.02
|
|
-
|
Charge for potential
capital gains tax payment to Exxaro
|
|
0.01
|
|
-
|
Diluted adjusted net
(loss) income per share attributable to Tronox Holdings plc
(non-U.S. GAAP)
|
|
$
(0.18)
|
|
$
0.01
|
|
|
|
|
|
Weighted average
shares outstanding, diluted (in thousands)
|
|
124,296
|
|
126,117
|
|
|
(a)
|
Represents a pre-tax
charge for the impairment and loss on sale of the assets of our
Tronox Electrolytic Operations which was recorded in "Impairment
loss" in the unaudited Condensed Consolidated Statements of
Operations.
|
(b)
|
Represents
transaction costs primarily associated with the Cristal Transaction
which were recorded in "Selling, general and administrative
expenses" in the unaudited Condensed Consolidated Statements of
Operations.
|
(c)
|
Represents the loss
in connection with the modification of the Wells Fargo Revolver and
termination of the ABSA Revolver.
|
(d)
|
Represents the
potential payment to Exxaro for capital gains tax on the disposal
of its ordinary shares in Tronox Holding plc included in "Other
expense, net" in the unaudited Condensed Consolidated Statements of
Operations.
|
TRONOX HOLDINGS
PLC
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(UNAUDITED)
|
(Millions of U.S.
dollars, except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
|
|
2019
|
|
2018
|
ASSETS
|
|
|
|
|
Current
Assets
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
1,068
|
|
$
1,034
|
|
Restricted
cash
|
|
666
|
|
662
|
|
Accounts receivable,
net of allowance for doubtful accounts
|
|
300
|
|
317
|
|
Inventories,
net
|
|
486
|
|
479
|
|
Prepaid and other
assets
|
|
49
|
|
50
|
|
Income taxes
receivable
|
|
2
|
|
2
|
|
|
Total current
assets
|
|
2,571
|
|
2,544
|
|
|
|
|
|
|
|
Noncurrent
Assets
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
992
|
|
1,004
|
|
Mineral leaseholds,
net
|
|
787
|
|
796
|
|
Intangible assets,
net
|
|
169
|
|
176
|
|
Lease right of use
assets
|
|
62
|
|
-
|
|
Deferred tax
assets
|
|
35
|
|
37
|
|
Other long-term
assets
|
|
110
|
|
85
|
|
|
Total
assets
|
|
$
4,726
|
|
$
4,642
|
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
|
Accounts
payable
|
|
$
150
|
|
$
133
|
|
Accrued
liabilities
|
|
119
|
|
140
|
|
Short-term lease
liabilities
|
|
19
|
|
-
|
|
Short-term
debt
|
|
94
|
|
-
|
|
Long-term debt due
within one year
|
|
58
|
|
22
|
|
Income taxes
payable
|
|
2
|
|
5
|
|
|
Total current
liabilities
|
|
442
|
|
300
|
|
|
|
|
|
|
|
Noncurrent
Liabilities
|
|
|
|
|
|
Long-term debt,
net
|
|
3,223
|
|
3,139
|
|
Pension and
postretirement healthcare benefits
|
|
91
|
|
93
|
|
Asset retirement
obligations
|
|
70
|
|
68
|
|
Long-term lease
liabilities
|
|
44
|
|
-
|
|
Long-term deferred
tax liabilities
|
|
159
|
|
163
|
|
Other long-term
liabilities
|
|
17
|
|
17
|
|
|
Total
liabilities
|
|
4,046
|
|
3,780
|
|
|
|
|
|
|
|
Commitments and
Contingencies
|
|
|
|
|
Shareholders'
Equity
|
|
|
|
|
|
Tronox Holdings plc
ordinary shares, par value $0.01 — 125,738,462 shares issued and
outstanding at March 31, 2019 and 123,015,301 shares issued and
122,933,845 shares outstanding at December 31, 2018
|
|
1
|
|
1
|
|
Capital in excess of
par value
|
|
1,584
|
|
1,579
|
|
Accumulated
deficit
|
|
(397)
|
|
(357)
|
|
Accumulated other
comprehensive loss
|
|
(612)
|
|
(540)
|
|
|
Total Tronox
Holdings plc shareholders' equity
|
|
576
|
|
683
|
|
Noncontrolling
interest
|
|
104
|
|
179
|
|
|
Total
equity
|
|
680
|
|
862
|
|
|
Total liabilities
and equity
|
|
$
4,726
|
|
$
4,642
|
TRONOX HOLDINGS
PLC
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(UNAUDITED)
|
(Millions of U.S.
dollars)
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2019
|
|
2018
|
Cash Flows from
Operating Activities:
|
|
|
|
Net loss
|
$
(30)
|
|
$
(41)
|
Adjustments to
reconcile net loss to net cash provided by (used in) operating
activities:
|
|
|
|
Depreciation,
depletion and amortization
|
47
|
|
48
|
Deferred income
taxes
|
(3)
|
|
3
|
Share-based
compensation expense
|
8
|
|
7
|
Amortization of
deferred debt issuance costs and discount on debt
|
2
|
|
5
|
Impairment
loss
|
-
|
|
25
|
Loss on
extinguishment of debt
|
2
|
|
-
|
Other non-cash
affecting net loss
|
6
|
|
10
|
Changes in assets and
liabilities:
|
|
|
|
Decrease in accounts
receivable, net
|
19
|
|
1
|
Increase in
inventories, net
|
(10)
|
|
(9)
|
Increase in prepaid
and other assets
|
(1)
|
|
(1)
|
Increase (decrease)
in accounts payable and accrued liabilities
|
8
|
|
(47)
|
Net changes in income
tax payables and receivables
|
(3)
|
|
(2)
|
Changes in other
non-current assets and liabilities
|
(6)
|
|
(3)
|
Cash provided by
(used in) operating activities
|
39
|
|
(4)
|
|
|
|
|
Cash Flows from
Investing Activities:
|
|
|
|
Capital
expenditures
|
(25)
|
|
(28)
|
Loans
|
(25)
|
|
-
|
Cash used in
investing activities
|
(50)
|
|
(28)
|
|
|
|
|
Cash Flows from
Financing Activities:
|
|
|
|
Repayments of
long-term debt
|
(101)
|
|
(6)
|
Proceeds from
short-term debt
|
94
|
|
-
|
Proceeds from
long-term debt
|
222
|
|
-
|
Acquisition of
noncontrolling interest
|
(148)
|
|
-
|
Debt issuance
costs
|
(4)
|
|
(1)
|
Proceeds from the
exercise of warrants
|
-
|
|
2
|
Dividends
paid
|
(7)
|
|
(6)
|
Restricted stock and
performance-based shares settled in cash for withholding
taxes
|
(6)
|
|
(4)
|
Cash provided by
(used in) financing activities
|
50
|
|
(15)
|
|
|
|
|
|
|
|
|
Effects of
exchange rate changes on cash, cash equivalents and restricted
cash
|
(1)
|
|
7
|
Net increase
(decrease) in cash and cash equivalents and restricted
cash
|
38
|
|
(40)
|
Cash, cash
equivalents and restricted cash at beginning of
period
|
1,696
|
|
1,769
|
Cash, cash
equivalents and restricted cash at end of period
|
$1,734
|
|
$1,729
|
TRONOX HOLDINGS
PLC
|
RECONCILIATION OF
NET LOSS TO EBITDA AND ADJUSTED EBITDA (NON-U.S.
GAAP)
|
(UNAUDITED)
|
(Millions of U.S.
dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
|
2019
|
|
2018
|
|
|
|
|
|
Net loss (U.S.
GAAP)
|
$(30)
|
|
$ (41)
|
|
Interest
expense
|
49
|
|
49
|
|
Interest
income
|
(9)
|
|
(8)
|
|
Income tax
provision
|
2
|
|
5
|
|
Depreciation,
depletion and amortization expense
|
47
|
|
48
|
EBITDA (non-U.S.
GAAP)
|
59
|
|
53
|
|
Impairment loss
(a)
|
-
|
|
25
|
|
Share based
compensation (b)
|
8
|
|
7
|
|
Transaction costs
(c)
|
8
|
|
20
|
|
Loss on
extinguishment of debt (d)
|
2
|
|
-
|
|
Foreign currency
remeasurement (e)
|
(1)
|
|
10
|
|
Other items
(f)
|
4
|
|
2
|
Adjusted EBITDA
(non-U.S. GAAP)
|
$ 80
|
|
$117
|
|
|
(a)
|
Represents a pre-tax
charge for the impairment and loss on sale of the assets of our
Tronox Electrolytic Operations which was recorded in "Impairment
loss" in the unaudited Condensed Consolidated Statements of
Operations.
|
(b)
|
Represents non-cash
share-based compensation.
|
(c)
|
Represents
transaction costs associated with the Cristal Transaction which
were recorded in "Selling, general and administrative expenses" in
the unaudited Condensed Consolidated Statements of
Operations.
|
(d)
|
Represents the loss
in connection with the modification of the Wells Fargo Revolver and
termination of the ABSA Revolver.
|
(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, which are included in "Other
expense, net" in the unaudited Condensed Consolidated Statements of
Operations. Prior to the first quarter of 2019, realized gains and
losses associated with third party receivables and liabilities had
been included in Adjusted EBITDA. Commencing with 2019, we are now
excluding these amounts from Adjusted EBITDA and prior period
amounts have been revised for comparability purposes. The exclusion
of all of the realized and unrealized gains and losses is
consistent with the reporting of Adjusted EBITDA we make to our
lenders
|
(f)
|
Includes noncash
pension and postretirement costs, accretion expense and other items
included in "Selling general and administrative expenses", "Cost of
goods sold" and "Other expense, net" in the unaudited Condensed
Consolidated Statements of Operations. Amounts for 2019 also
include the potential payment to Exxaro for capital gains tax on
the disposal of its ordinary shares in Tronox Holding plc included
in "Other expense, net" in the unaudited Condensed Consolidated
Statements of Operations.
|
TRONOX HOLDINGS
PLC
|
SEGMENT
INFORMATION
|
REVENUE, OPERATING
INCOME
|
AND
|
FREE CASH FLOW
(NON-U.S. GAAP)
|
(UNAUDITED)
|
(Millions of U.S.
dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table
reconciles net sales and sales growth excluding
Electrolytic:
|
|
|
Three Months
Ended
March 31,
|
|
|
2019
|
|
2018
|
|
%
variance
|
Net sales
|
|
$
390
|
|
$442
|
|
-12
|
%
|
Electrolytic
sales
|
|
-
|
|
(12)
|
|
-100
|
%
|
Net sales,
excluding Electrolytic sales
|
|
$
390
|
|
$430
|
|
-9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table
reconciles Cash provided by operating activities, to free cash flow
for the three months ended March 31, 2019:
|
|
|
|
|
|
|
|
Consolidated
|
|
|
|
|
|
Cash provided by
operating activities, continuing operations
|
$
39
|
|
|
|
|
|
Capital
expenditures
|
|
(25)
|
|
|
|
|
|
Free cash flow (non-U.S. GAAP)
|
$
14
|
|
|
|
|
|
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SOURCE Tronox Holdings plc