Tronox Holdings Plc · NYSE:TROX
Tronox — Q2 2024 Earnings Presentation
23 slides from Tronox's earnings presentation, Aug 2, 2024
Slide 1: Second Quarter 2024 Conference Call
Second Quarter 2024 Conference Call Tronox Holdings plc August 2, 2024 Tronox Holdings plc | tronox.com | Confidential & Proprietary | © 2024 1
Slide 2: Presenters
Presenters John Romano John Srivisal Chief Executive Officer Senior Vice President, Chief Financial Officer Tronox Holdings plc | tronox.com | Confidential & Proprietary | © 2024 2
Slide 3: 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 4: Tronox – A Diversified, Vertically Integrated Titanium Industry Leader
Tronox – A Diversified, Vertically Integrated Titanium Industry Leader TROX $2.9B $524M 85% ~6,500 ~1,200 NYSE 2023 Revenue 2023 Adj. EBITDA Feedstock Integration1 Global Employees Customers • Vertically integrated mining and inorganic chemical Sales by Sales by TiO2 Sales Volume company Region2 Pro
Slide 5: Key Messages from the Quarter
Key Messages from the Quarter Performance consistent with previous guidance • TiO2 volumes continued recovery improved 8% QoQ within guided range of 7-10% – Demand increased in all regions in line with normal seasonal trends • Zircon volumes relatively flat to prior quarter – End of quarter bulk shi
Slide 6: 2023 Sustainability Report Goals & Targets
2023 Sustainability Report Goals & Targets ACHIEVE NET ZERO REDUCE SCOPE 3 ZERO WASTE TO ACHIEVE ZERO HARM BY FOSTER AND BUILD A BY 2050 EMISSIONS IN OUR EXTERNAL DEDICATED BUILDING CAPACITY IN WORKPLACE THAT SUPPLY CHAIN LANDFILLS OUR PEOPLE, PLANTS REFLECTS THE AND PROCESSES COMMUNITIES IN WHICH 2
Slide 7: Second Quarter 2024 Financial Highlights
Second Quarter 2024 Financial Highlights Q2 ’24 Q2 ’23 YoY % ∆ Q1 ’24 QoQ % ∆ • Revenue increase primarily driven by higher sales Revenue $ 820 $ 794 3% $ 774 6% volumes from TiO2 • Income from operations of $76M; Net income Income from Operations $ 76 $ 84 (10)% $ 41 85% attributable to Tronox of $
Slide 8: Commercial Performance
Commercial Performance Sales volumes continued recovery from 2023 levels Price/Mix Q2 ’24 Q2 ’23 YoY % ∆ Q1 ’24 QoQ % ∆ • TiO2 pricing improved 1% QoQ, partially offset by unfavorable Revenue $ 820 $ 794 3% $ 774 6% mix impact TiO2 653 611 7% 605 8% – Higher pricing increases in regions where prices
Slide 9: Operational Performance
Operational Performance Improved fixed cost absorption and lower input costs drove lower production costs YoY Production Costs Q2 ’24 Q2 ’23 YoY % ∆ Q1 ’24 QoQ % ∆ • YoY: Improvement of $37M mainly driven by improved fixed Adjusted EBITDA $ 161 $ 168 (4)% $ 131 23% cost absorption and lower input co
Slide 10: Liquidity, Capital Expenditures & Free Cash Flow
Liquidity, Capital Expenditures & Free Cash Flow Balance sheet remains strong • Total debt at the end of Q2 2024 remained $2.8B; 5.2x net • Total available liquidity of $680M as of June 30, 2024 leverage on TTM basis – Includes $201M in cash and cash equivalents – Q2 2024 weighted average interest r
Slide 11: 2024 From Tronox's View
2024 From Tronox’s View Market Operations Growth • Demand across TiO2 and zircon • Resolved Q2 short term • R&D efforts remain focused on has improved significantly operational challenges relating product and process innovations compared to 2023 to ramping up pigment assets to enhance profitability
Slide 12: Outlook
Outlook Q1 ’24A Q2 ’24A Q3 ’24E Full Year Uses of Cash FY 2024E TiO2 Volume QoQ / YoY 18% / 18% 8% / 16% ↓2-4% / ↑high-teens Net Cash Interest Expense ~$140M Relatively flat / Net Cash Taxes <$10M Zircon Volume QoQ / YoY 54% / 43% (4)% / 4% ↑160% Working Capital Source of cash Adjusted EBITDA $131M
Slide 13: 2024 Capital Allocation Priorities
2024 Capital Allocation Priorities Our capital allocation strategy remains unchanged 1 Investing in projects that are critical to furthering our strategy and driving value from our vertically integrated portfolio 2 Bolstering our liquidity and as the market recovers, resume debt paydown 3 Maintainin
Slide 14: Q&A Session
Q&A Session Tronox Holdings plc | tronox.com | Confidential & Proprietary | © 2024 14
Slide 15: Appendix
Appendix © 2024 Tronox Holdings plc | All rights reserved. | tronox.com 15
Slide 16: Key Capital Projects to Sustain Vertical Integration
Key Capital Projects to Sustain Vertical Integration Fairbreeze Expansion Project Namakwa East OFS Project Life of mine finished Life of mine finished products: ~4,700kt products: ~6,480kt ilmenite, ~610kt zircon, ilmenite, ~935kt zircon, and ~325kt rutile and ~490kt rutile • South African mining pr
Slide 17: Consolidated Statements of Operations (U.S. GAAP)
Consolidated Statements of Operations (U.S. GAAP) 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 June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net sales $ 820 $ 794 $
Slide 18: 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 INCOME (LOSS) ATTRIBUTABLE TO TRONOX HOLDINGS PLC (U.S. GAAP) TO ADJUSTED NET INCOME
Slide 19: Consolidated Balance Sheets
Consolidated Balance Sheets TRONOX HOLDINGS PLC CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Millions of U.S. dollars, except share and per share data) June 30, 2024 December 31, 2023 ASSETS Current Assets Cash and cash equivalents $ 201 $ 273 Accounts receivable (net of allowance for credit l
Slide 20: Consolidated Statements of Cash Flows
Consolidated Statements of Cash Flows TRONOX HOLDINGS PLC CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Millions of U.S. dollars) Six Months Ended June 30, 2024 2023 Cash Flows from Operating Activities: Net income (loss) $ 1 $ (244) Adjustments to reconcile net income (loss) to net cash provid
Slide 21: Reconciliation of Net Income to EBITDA and Adjusted EBITDA (NON-U.S. GAAP)
Reconciliation of Net Income to EBITDA and Adjusted EBITDA (NON-U.S. GAAP) TRONOX HOLDINGS PLC RECONCILIATION OF NET INCOME (LOSS) TO EBITDA AND ADJUSTED EBITDA, ADJUSTED EBITDA AS A % OF NET SALES AND NET DEBT TO TRAILING-TWELVE MONTHS ADJUSTED EBITDA (NON-U.S. GAAP) (UNAUDITED) (Millions of U.S. d
Slide 22: 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 and six months ended June 30, 2024: Six Months Ended Three Months Ended Three Mont
Slide 23: Reconciliation of Trailing Twelve Month Net (Loss) Income to EBITDA and Adjusted EBITDA
Reconciliation of Trailing Twelve Month Net (Loss) Income to EBITDA and Adjusted EBITDA (NON-U.S. GAAP) TRONOX HOLDINGS PLC RECONCILIATION OF TRAILING TWELVE MONTH NET (LOSS) INCOME TO EBITDA AND ADJUSTED EBITDA (NON-U.S. GAAP) (UNAUDITED) (Millions of U.S. dollars) Three Months Ended Trailing Twelv