Tronox Holdings Plc · NYSE:TROX
Tronox — Q2 2007 Earnings Presentation
21 slides from Tronox's earnings presentation, Aug 6, 2007
Slide 1: Building a more competitive company: Second-Quarter Preliminary Results
Buildinga more competitive company Second-Quarter Preliminary Results August 1, 2007
Slide 2: Forward-Looking Statement
Forward-Looking Statement Tronox makes certain forward-looking statements in this presentation that are subject to risks and uncertainties. These statements are based on the beliefs and assumptions of our management and on information currently available to our management at the time of such stateme
Slide 3: Agenda
Agenda Perspective and Key Initiatives Tom Adams ? Chairman and Chief Executive Officer Second-Quarter Performance and Land Sales Update Robert Gibney ? Vice President of Investor Relations and External Affairs Financial Highlights Mary Mikkelson ? Senior Vice President and Chief Financial Officer Q
Slide 4: Strategic Focus
Strategic Focus Baseline Improvements Project Cornerstone Additional savings Selling Stranded Assets Progress being made Environmental and Legal Mitigate liability Balance Sheet Flexibility
Slide 5: Cornerstone Execution
Cornerstone Execution Cash Cost Reductions Land Sales & Capital Program * Does not include 2,200-acre LandWell sales Status Summary Teams on track or ahead of schedule Remain committed to target attainment Beginning to realize benefits in the bottom line $MM $MM * (Cumulative) (Cumulative) * Invento
Slide 6: PPI Industrial Chemicals and TiO2 Inputs
Source: Census Bureau PPI Industrial Chemicals (1982 = 100) TiO2 Inputs
Slide 7: Debt Pay Down
Debt Pay Down $11.5MM Reduction Outstanding Debt = $537.5MM 2006 2007 East 189.5 178 ($MM) Term Loan $189.5 $178.0 2007 2007 Q1 Q2
Slide 8: Uerdingen, Germany
Uerdingen, Germany World-Class Sulfate Process New High Ilmenite Feed Process Annual Capacity = 107,000 MT Strategic Option Status: Process extended to include additional companies
Slide 9: Titanium Tetrachloride: Leverage Technology Advantage
Titanium Tetrachloride Leverage Technology Advantage High Growth Titanium Metals Market Multiple Tronox Plant Locations with High-Quality TiCl4 Titanium Metals Manufacturing
Slide 10: Outlook
Outlook World 2.1% 2.7% 10.5% 3.4% 2007 GDP Forecast Regional Health Gauge (major country proxy) Germany China United States Continued High Input Prices Weak U.S. Housing Strong Demand Asia-Pacific and Europe Additional Project Cornerstone Cost Reduction Initiatives
Slide 11: Second-Quarter Preliminary Results
Second-Quarter Preliminary Results Net Sales Cost of Sales Gross Margin Income (Loss) From Continuing Ops. Diluted EPS From Continuing Ops. Second Quarter 2007 Second Quarter 2006 Foreign Exchange and Freight $1.5MM Environmental Provision + $6.8MM Tax Provision ($MM) 375.9 342.7 33.2 (5.7) (0.14) $
Slide 12: Q2 2007 EPS Bridge (vs. Q2 2006)
Q2 2007 EPS Bridge (vs. Q2 2006) Based on 40.6MM shares
Slide 13: Process Chemicals & Energy Outlook 2007
Process Chemicals & Energy Outlook 2007 U.S. Natural Gas Hedges Q3 Q4 Amount hedged ~90% ~70% Weighted price with basis ($/MMBtu) $6.94 $7.72 Source: CMAI Project Cornerstone Reduced Consumption = $5MM Annually
Slide 14: TiO2 Pigment
TiO2 Pigment Lower Sales Volumes and Prices Due to Weak North American Demand All Plants with Exception of Botlek Ran as Expected During Quarter 2006 2007 East 369 340.2 2006 2007 East 144.5 147.6 (in thousands of tonnes) 589 598 Production +2% 2007 2006 147.6 144.5 ($MM) $352.0 $340.2 Sales -3% Q2
Slide 15: Electrolytic & Other Chemical Products
Electrolytic & Other Chemical Products 2006 2007 East 24 26.3 ($MM) Sales +10% $23.9 $26.3 2006 2007 Q2 Q2 Q2 Revenues Up From Chlorate Cornerstone Program Operating Profit Impacted by Environmental Charge Pursuing Strategies to Address Low-Priced EMD Import Growth
Slide 16: Land Sales Highlights
Land Sales Highlights Tronox 100% Henderson, Nevada ~150 acres total Signed contract on 53-acre tract Additional sales of smaller tracts expected 2007 Key environmental approvals on track LandWell Company Participation 2,200-acre development progressing Additional acreage nearing contract and sale F
Slide 17: Working Capital & Cash Flow - Ahead of Schedule
Working Capital & Cash Flow - Ahead of Schedule Cash to Cash 127 138 Cash Flows $29 ($1) Reduced Term Loan by $11.5MM June 30, 2007 (In Days) March 31, 2006 From Operating Activities ($MM) Q2, 07 Q2, 06 Cornerstone
Slide 18: Financial Items
Financial Items Financial Items ($MM) Q2 2007 YTD 2007 2007 Outlook Interest Expense $12.4 $24.7 $48 to $52 Capital Expenditures $19.5 $33.8 $75 to $80 Depreciation and Amortization $27.9 $55.8 $106 to $110 Effective Tax Rate -33%
Slide 19: Environmental Reserves
Environmental Reserves = $214MM Receivables *Excludes anticipated future receivables of $39MM from DOE for West Chicago 2007 Net Cash Spend Projected = $35MM to $40MM As of 6/30/2007 $ = 60MM*
Slide 20: Q&A
Q&A www.tronox.com
Slide 21: Building a more competitive company: Second-Quarter Preliminary Results
Buildinga more competitive company Second-Quarter Preliminary Results August 1, 2007