Tronox Holdings Plc · NYSE:TROX
Tronox — Q1 2020 Earnings Presentation
21 slides from Tronox's earnings presentation, May 7, 2020
Slide 1: First Quarter 2020 Conference Call
First Quarter 2020 Conference Call Tronox Holdings plc May 7, 2020 Tronox Holdings plc | tronox.com | Confidential & Proprietary | © 2020 1
Slide 2: Safe Harbor Statement and Non-U.S. GAAP Financial Terms
Safe Harbor Statement and Non-U.S. GAAP Financial Terms Cautionary Statement about Forward-Looking Statements Statements in this presentation 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
Slide 3: First Quarter 2020 Highlights
First Quarter 2020 Highlights Adjusted EBITDA and Adjusted EPS exceeded preliminary results Q1 ‘20 Q1 ’19 YoY % ∆ Q4 ‘19 QoQ % ∆ • Revenue up 4% sequentially, driven by TiO2 demand in North Pro Forma Summary Financials America in architectural DIY coatings and plastics end markets Revenue $ 722 $ 72
Slide 4: COVID-19 Response
COVID-19 Response Our focus has been to prioritize three areas: Employees Operations Our Essential Role • Continue to prioritize the safety, • All sites are currently operating • Our operations around the world health and well-being of our have been designated as employees and their families • Ensur
Slide 5: Commercial Performance
Commercial Performance USD millions 1Q20 1Q19(1) YoY % ∆ 4Q19 QoQ % ∆ YoY % ∆ QoQ % ∆ Revenue $ 722 $ 720 0% $ 693 4% Volume Price Volume Price TiO2 580 570 2% 544 7% TiO2 6% (1%) 7% 0% Zircon 65 82 (21%) 71 (8%) Local Currency n/a (3%) n/a 0% Feedstock & Other 77 68 13% 78 (1%) Zircon (7%) (16%) 0%
Slide 6: Operational Performance
Operational Performance USD millions 1Q20 1Q19(1) YoY % ∆ 4Q19 QoQ % ∆ Adjusted EBITDA $ 174 $ 141 23% $ 156 12% Adjusted EBITDA margin 24% 20% 4 pts 23% 1 pt • Q/Q price decline driven by Zircon; Y/Y price decline driven mainly by Zircon with declines in TiO2 pricing in regions such as South Americ
Slide 7: Tronox Delivered $45 million of Synergies in Q1 2020
Tronox Delivered $45 million of Synergies in Q1 2020 Remain committed to our synergy targets Total Synergies $325 USD millions EBITDA Synergies Achieved & Reflected in P&L YTD $275 Tax and Other Synergies Not Reflected in EBITDA Synergy Target $190 $89 $42 $45 $7 $47 $38 2019 Q1 2020 2020 2021 2022
Slide 8: Liquidity and Capital Resources
Liquidity and Capital Resources(1) Pro Forma as of March 31, 2020(1) Pro forma (US$ in millions) March 31, 2020(1) • Current liquidity is $1,070 million Cash and cash equivalents $ 720 • Cash is well distributed across Available under ABL Facility 248 regions – no trapped cash Available under the St
Slide 9: Strong Financial Position
Strong Financial Position • Completed the offering of $500 million 6.5% senior secured notes due 2025 • Total debt of $3.5 billion, net debt of $2.8 billion, TTM net leverage of 3.9x(1) • No near-term maturities on our term loans or bonds until 2024 • No financial covenants on our term loans or bond
Slide 10: Outlook
Outlook • Q2 2020 outlook: • FY 2020 Estimated Uses of Cash: ‒ TiO2 sales volumes to decline in the high teens to ‒ Net Interest Expense: ~$165-170 million(1) low twenties percent range versus Q1 2020 ‒ Zircon volumes to remain largely ‒ Cash Taxes: ~$20-30 million in line with Q1 2020 ‒ Working Cap
Slide 11: Q&A Session
Q&A Session Tronox Holdings plc | tronox.com | Confidential & Proprietary | © 2020 11
Slide 12: Appendix
Appendix © 2020 Tronox Holdings plc. | All rights reserved. | tronox.com 12
Slide 13: Consolidated Statements of Operations (U.S. GAAP)
Consolidated Statements of Operations (U.S. GAAP) TRONOX HOLDINGS PLC CONSOLIDATED STATEMENTS OF OPERATIONS (U.S. GAAP) (UNAUDITED) (Millions of U.S. dollars, except share and per share data) Three Months Ended March 31, 2020 2019 Net sales $ 722 $ 390 Cost of goods sold 547 307 Gross profit 175 83
Slide 14: Reconciliation of Non-U.S. GAAP Financial Measures
Reconciliation of Non-U.S. GAAP Financial Measures 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) INCOME ATTRIBUTABLE TO TRONOX HOLDINGS PLC (U.S. GAAP) TO ADJUSTED NET INCOME
Slide 15: Consolidated Balance Sheets
Consolidated Balance Sheets TRONOX HOLDINGS PLC CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Millions of U.S. dollars, except share and per share data) March 31, 2020 December 31, 2019 ASSETS Current Assets Cash and cash equivalents $ 420 $ 302 Restricted cash 9 9 Accounts receivable (net of allowance f
Slide 16: Consolidated Statements of Cash Flows
Consolidated Statements of Cash Flows TRONOX HOLDINGS PLC CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Millions of U.S. dollars) Three Months Ended March 31, 2020 2019 Cash Flows from Operating Activities: Net income (loss) $ 40 $ (30) Adjustments to reconcile net income (loss) to net cash pro
Slide 17: Reconciliation of Net Loss Income to EBITDA and Adjusted EBITDA (NON-U.S. GAAP)
Reconciliation of Net Loss Income to EBITDA and Adjusted EBITDA (NON-U.S. GAAP) 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, 2020 2019 Net (loss) income (U.S. GAAP) $ 40 $ (30) Interes
Slide 18: Free Cash Flow (NON-U.S. GAAP)
Free Cash Flow (NON-U.S. GAAP) TRONOX HOLDINGS PLC FREE CASH FLOW (NON-U.S. GAAP) (UNAUDITED) (Millions of U.S. dollars) The following table reconciles cash used in operating activities to free cash flow for the three months ended March 31, 2020: Consolidated Cash used in operating activities $ (28)
Slide 19: Pro Forma Consolidated Statements of Operations (U.S. GAAP)
Pro Forma Consolidated Statements of Operations (U.S. GAAP) TRONOX HOLDINGS PLC PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS (U.S. GAAP) (UNAUDITED) (Millions of U.S. dollars, except share and per share data) Proforma amounts March 31, 2020 2019 Net sales $ 722 $ 720 Cost of goods sold 547 579 Gr
Slide 20: Reconciliation of Pro Forma Net (Loss) Income to Adjusted Net Income
Reconciliation of Pro Forma Net (Loss) Income from Continuing Operations attributable to Tronox Holdings plc (U.S. GAAP) to Adjusted Net Income (Loss) from Continuing Operations attributable to Tronox Holdings plc (NON-U.S. GAAP) TRONOX HOLDINGS PLC PRO FORMA RECONCILIATION OF NON-U.S. GAAP FINANCIA
Slide 21: Pro Forma Reconciliation of Net Income (Loss) to EBITDA and Adjusted EBITDA
Pro Forma Reconciliation of Net Income (Loss) from Continuing Operations to EBITDA and Adjusted EBITDA (non-U.S. GAAP) TRONOX HOLDINGS PLC PRO FORMA RECONCILIATION OF NET INCOME (LOSS) TO EBITDA AND ADJUSTED EBITDA (NON-U.S. GAAP) (UNAUDITED) (Millions of U.S. dollars) Pro Forma Three Months Ended M