Tronox Holdings Plc · NYSE:TROX
Tronox — Q2 2020 Earnings Presentation
21 slides from Tronox's earnings presentation, Jul 30, 2020
Slide 1: Second Quarter 2020 Conference Call
Second Quarter 2020 Conference Call Tronox Holdings plc July 30, 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: Second Quarter 2020 Highlights
Second Quarter 2020 Highlights TiO2 Sales Volumes Consistent with Q2 Outlook; TiO2 Pricing Level; Zircon Above Expectations • Revenue declined by 20 percent sequentially driven primarily by Pro Forma Summary Financials Q2 ‘20 Q2 ’19 YoY % ∆ Q1 ‘20 QoQ % ∆ impacts to TiO2 demand as a result of the CO
Slide 4: Commercial Performance
Commercial Performance USD millions 2Q20 2Q19(1) YoY % ∆ 1Q20 QoQ % ∆ YoY % ∆(1) QoQ % ∆ Revenue $ 578 $ 827 (30%) $ 722 (20%) Volume Price Volume Price TiO2 466 657 (29%) 580 (20%) TiO2 (27%) (3%) (19%) 0% Zircon 68 89 (24%) 65 5% Local Currency n/a (2%) n/a 0% Feedstock & Other 44 81 (46%) 77 (43%
Slide 5: TiO2 Demand | COVID-19 Impact by Region
TiO2 Demand | COVID-19 Impact by Region Europe North America • Social restrictions began lifting mid-way through the • Social restrictions began lifting halfway through Q2 quarter on a country-by-country basis • Continued strength in DIY market with improving • Our customers’ operations started reop
Slide 6: Operational Performance
Operational Performance USD millions 2Q20 2Q19(1) YoY % ∆ 1Q20 QoQ % ∆ Adjusted EBITDA $ 142 200 (29%) $ 174 (18%) Adjusted EBITDA margin 25% 24% 1 pt 24% 1 pt • QoQ and YoY volume declines driven by TiO2 due to impacts from COVID-19, lack of mandated CP slag shipments in the quarter, and lower pig
Slide 7: Tronox Delivered $107 million of Synergies YTD Q2 2020
Tronox Delivered $107 million of Synergies YTD Q2 2020 Remain committed to our synergy targets Total Synergies $325 USD millions $275 EBITDA Synergies Achieved & Reflected in P&L YTD Tax and Other Synergies Not Reflected in EBITDA Synergy Target $190 Total of Full Year Target Achieved $107 $89 $23 $
Slide 8: Liquidity and Capital Resources
Liquidity and Capital Resources As of June 30, 2020 (US$ in millions) June 30, 2020 • Current liquidity is $1,123 million Cash and cash equivalents $ 722 • Cash is well distributed across Available under ABL Facility 288 regions – no trapped cash Available under the Standard Credit Facility (1) 58 •
Slide 9: Strong Financial Position
Strong Financial Position • Total debt of $3.5 billion, net debt of $2.8 billion, TTM net leverage of 4.2x • No maturities on our term loans or bonds until 2024 • No financial covenants on our term loans or bonds • Capital expenditures in the second quarter were $44 million; depreciation, depletion
Slide 10: Outlook
Outlook • Q3 2020 outlook: • Maintaining previous FY 2020 synergy targets: ‒ TiO2 sales volumes to continue to improve versus ‒ Total synergies of $190 million; $140 million within Q2 2020 EBITDA ‒ Zircon market to remain relatively stable as compared to the last several quarters • FY 2020 Estimated
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 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, 2020 2019 2020 2019 Net sales $ 578 $ 791 $
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 FROM CONTINUING OPERATIONS ATTRIBUTABLE TO TRONOX HOLDINGS PLC (U.S. G
Slide 15: 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, 2020 December 31, 2019 ASSETS Current Assets Cash and cash equivalents $ 722 $ 302 Restricted cash 27 9 Accounts receivable (net of a
Slide 16: Consolidated Statements of Cash Flows
TRONOX HOLDINGS PLC Consolidated Statements of Cash Flows CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Millions of U.S. dollars) Six Months Ended June 30, 2020 2019 Cash Flows from Operating Activities: Net income (loss) $ 36 $ (86) Net income from discontinued operations, net of tax - $ (1) N
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 Six Months Ended June 30, June 30, 2020 2019 2020 2019 (a) 2019 amoun
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 six months ended June 30, 2020: Consolidated Cash provided by operating activities - con
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 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (U.S. GAAP) (UNAUDITED) (Millions of U.S. dollars, except share and per share data) Proforma amounts Proforma amounts June 30, Six Months Ended June 30, 2020 2019
Slide 20: Reconciliation of Pro Forma Net (Loss) Income from Continuing Operations
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 Pro Forma Six Months