Tronox Holdings Plc · NYSE:TROX
Tronox — Investor Day (June 2022)
101 slides from Tronox's investor day presentation, Jun 16, 2022
Slide 1: Clearly Differentiated
Clearly Differentiated Investor Day - June 16, 2022
Slide 2: Welcome & Safety Share
Welcome & Safety Share Jennifer Guenther | VP, Investor Relations
Slide 3: New York Stock Exchange Safety Briefing
New York Stock Exchange Safety Briefing General Fire Safety Procedures Feel doorknobs with the back of your hand before you open 1 Identify all emergency exits. 6 any doors and open slowly. Stay on the right in order to allow emergency response 2 Do not ignore an alarm. 7 personnel clear access up t
Slide 4: 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 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- lo
Slide 5: Today’s Agenda
Today’s Agenda Welcome & Safety Share 8:30 am Operational Excellence 10:15 am Jennifer Guenther Russ Austin VP, Investor Relations SVP, Operations Tronox: Clearly Differentiated Investing in Our Assets Jean-François Turgeon – co-Chief Executive Officer John Srivisal John Romano – co-Chief Executive
Slide 6: Tronox: Clearly Differentiated
Tronox: Clearly Differentiated Jean-François Turgeon | co-CEO John Romano | co-CEO
Slide 7: Clearly Differentiated
Clearly Differentiated 1 2 3 4 5 Executing as Demonstrating Strengthening Outperforming Investing for a World-class a Track Record Competitive and Enabling Profitable Operator of Execution Differentiators Success Growth Delivering strong, Significant Deepening vertical Unwavering in our Returning va
Slide 8: Living Our Values Unleashes Our Potential
Living Our Values Unleashes Our Potential We… • Have an uncompromising focus on operating safe, reliable and responsible facilities • Honor our responsibility to create value for stakeholders • Treat others with respect and act with personal and organizational integrity • Build our organization with
Slide 9: We Lead With Safety
We Lead With Safety An uncompromising ✓ Investing in our people, plants and processes to achieve world-class safety focus on operating safe, reliable and ✓ Collaborating with and ensuring all functions understand their contributions responsible facilities to safe work outcomes is our highest ✓ Provi
Slide 10: The Transformation of Tronox
The Transformation of Tronox 2019 2020 2021 2022 Redomiciled to the UK Realized $220M target in Appointed John Romano and Achieved 20th quarter of from Australia Cristal acquisition synergies Jean-François Turgeon EBITDA Margin >20% two years ahead of schedule; co-CEOs Closed transformative $2.2B At
Slide 11: A Larger, More Diversified and More Stable Company
A Larger, More Diversified and More Stable Company Pre Cristal Acquisition1 2021 ∆ Mines | Upgrading | Pigment Facilities 3|5|3 6|5|9 +3 | - | +6 Nameplate TiO2 Pigment Capacity 465K tons 1.1M tons +613K tons Chloride / Sulfate Technology 100% / 0% 87% / 13% +13% Sulfate Zircon Processing Capacity 2
Slide 12: Diversified, Vertically Integrated Titanium Industry Leader
Diversified, Vertically Integrated Titanium Industry Leader TROX $3.6B $947M 85% ~6,500 ~1,200 NYSE 2021 Revenue 2021 Adj. EBITDA Feedstock Integration Global Employees Customers • Vertically integrated mining and inorganic Sales by Sales by TiO2 Sales Volume chemical company Region1 Product1 by End
Slide 13: Using Our Global Footprint for Good is Our Responsibility
Using Our Global Footprint for Good is Our Responsibility Environment Social Governance • Environmental stewardship • Global workforce with diverse • Board of Directors reflects the is an essential component of perspectives and backgrounds diversity of our global our business operations • We respect
Slide 14: Our Strategy Differentiates Us
Our Strategy Differentiates Us Advantaged global TiO2 leader Foundational Our Distinct Advantage Enabling 1 Competitive TiO2 2 3 4 Pigment Costs Feedstock Integration Leading Global Footprint TiO2 Technology Leader • Low-cost operator • Profit contribution from zircon • Effectively serve most attrac
Slide 15: An Experienced Executive Team Committed to Executing
An Experienced Executive Team Committed to Executing John Romano Jean-François Tim Carlson Melissa Zona co-Chief (“JF”) Turgeon SVP & Chief SVP, Chief Executive Officer co-Chief Financial Officer Sustainability 1988* / ~35 Executive Officer 2016 / ~35 & HR Officer (Joined / Experience) 2014 / ~35 20
Slide 16: An Engaged Board of Directors
An Engaged Board of Directors Skills Matrix2 Ilan Kaufthal CG* John Romano JF Turgeon Chairman, Tronox co-CEO, Tronox co-CEO, Tronox Senior Executive Experience 100% Elected to Board: 2011 2021 2021 Elected Chairman: 2020 Strategic Planning 100% Vanessa Guthrie A, CG Peter Johnston A, HR Stephen Jon
Slide 17: The TiO2 Landscape Has Changed
The TiO2 Landscape Has Changed What changed during the 2020 – 2022 COVID-19 pandemic period • Increased % of sales under contract following Chinese product shortages in 2020 • High sulfuric acid costs negatively impacting sulfate producers • High freight costs and duties result in higher delivered c
Slide 18: Focused on Long-term Value Creation for Shareholders
Focused on Long-term Value Creation for Shareholders • Initiated enhanced commercial approach with customers in 2018 to proactively stabilize margin volatility and enable cash generation across all scenarios Delivered 20 • Producing valuable co-products, such as zircon and pig iron, that contribute
Slide 19: Differentiated, Vertically Integrated Business Model
Differentiated, Vertically Integrated Business Model Clearly differentiated from peers 2021A EBITDA Margin1 26.5% Strong balance sheet and ample liquidity to 11 support our vertically integrated operations 19.4% 20.3% 13.5% 85% vertical integration provides annualized 22 feedstock cost savings of $3
Slide 20: Delivering on Our Commitments
Delivering on Our Commitments 2019 Investor Day 2022 Investor Day Targets Achievements Score $220M $243M Target Synergies (Cristal) ✔✔✔ in 2022 in 2020, 2 years early Yesterday’s Gross Debt $2.5B in 2023 $2.5B on April 4, 2022, 1 year early ✔ targets are today’s Net Leverage 2.0x – 3.0x <3.0x in Q3
Slide 21: Introducing New 2025 Financial Milestone Goals
Introducing New 2025 Financial Milestone Goals 2021A 2025E Commentary • Market growth driven by GDP Adj. EBITDA ($) $947M $1.3B – $1.5B • Absorption benefits and newTRON savings, partly offset by inflation in labor, ore, direct materials and Adj. EBITDA Margin (%) 26.5% 30%+ energy costs, drive marg
Slide 22: Investments Will Drive Profitable Growth and High Returns
Investments Will Drive Profitable Growth and High Returns Continued reinvestment in the business will generate returns in excess of 25% • Disciplined capital expenditures with hurdle rates >25% • Opportunities in base business and other potential markets, such as carbon capture and rare earths Trono
Slide 23: Jazan Would Significantly Increase Tronox’s Titanium Slag Production
Jazan Would Significantly Increase Tronox’s Titanium Slag Production Jazan Option • Site has the potential for two high-grade chloride slag furnaces (each with a capacity of 250KT) • Tronox technological expertise guiding Furnace 1 rebuild and startup process under revised agreement ‒ Tronox loaned
Slide 24: Disciplined Capital Allocation Supports Value Creation
Disciplined Capital Allocation Supports Value Creation • Elevated expected capital requirements in 2022 and 2023 – return threshold of 25% • newTRON 2022E capital: $90M Capital Expenditures • Vertical integration 2022E capital: $150M – $175M • Normalized estimated CapEx of $250M – $300M in 2025+ Gro
Slide 25: Clearly Differentiated
Clearly Differentiated 1 2 3 4 5 Executing as Demonstrating Strengthening Outperforming Investing for a World-class a Track Record Competitive and Enabling Profitable Operator of Execution Differentiators Success Growth Delivering strong, Significant Deepening vertical Unwavering in our Returning va
Slide 26: Preserving Our Privilege to Operate
Preserving Our Privilege to Operate Melissa Zona | SVP, Chief Sustainability & Human Resources Officer
Slide 27: Protecting Our People and Our Privilege to Operate
Protecting Our People and Our Privilege to Operate 1 2 3 4 5 Purposeful Protecting Keeping Our Leading with Supporting Investments Our Planet Commitments Safety Our People Investing in our Leaving the Earth Sustainability and Maintaining an Striving to be a people, projects and and our communities E
Slide 28: Continuing to Drive Sustainable Growth
Continuing to Drive Sustainable Growth We operate with the end in mind Sustainability has always been Living our values unleashes fundamental to and our full potential integrated into every aspect of our business, culture Our people make the difference and strategy Outperformance enables target acce
Slide 29: Updating Our Targets in 2022
Updating Our Targets in 2022 Achieve Carbon Zero Waste to Achieve Zero Harm Foster & Build a Neutrality by 2050 External Dedicated by Building Workplace that Landfills Capacity in our Reflects the 2050 2050 People, Plants and Communities in 100% Carbon Zero Waste Neutrality Reduce waste to Processes
Slide 30: Achieving Our Goals through Purposeful Investments
Achieving Our Goals through Purposeful Investments Investing in Investing in Investing in People Projects Products • Provide enduring benefits that • Solar agreement in South • TiO2 used to manufacture enhance communities where Africa will reduce our global catalysts for emissions we operate Scope 1
Slide 31: Developing Essential Products that Benefit the World
Developing Essential Products that Benefit the World Harnessing sunlight and photocatalytic properties of TiO2 • Photocatalytic solutions in building materials, paints and coatings can help to degrade air pollutants • Important component in solar energy technologies • Significant ingredient in dye-s
Slide 32: Delivering Results
Delivering Results We operate with Living our values Our people make Outperformance the end in mind unleashes our the difference enables target ✓ Created detailed plan full potential ✓ Planted 10,000 trees acceleration to align our business ✓ Achieved Platinum in Australia during ✓ Greenhouse Gas to
Slide 33: Accelerating Our Emissions Targets
Accelerating Our Emissions Targets 2021 View 2022 View Enabled By: 2025: 15% reduction in 2025: NEW 35% • Organizational momentum Scope 1 and 2 reduction in • Seeking out and applying GHG emissions Scope 1 and 2 opportunities to reduce intensity GHG emissions GHG emissions 2030: 35% reduction intens
Slide 34: Contributing to a Circular Economy
Contributing to a Circular Economy Reducing the amount of solid waste Zero waste generated or finding beneficial re-uses: to external • Helps lower costs landfills • Creates new revenue streams • Reduces our environmental footprint 2025: 15% reduction 2030: 25% reduction 2050: Zero waste to external
Slide 35: Leading with Safety
Leading with Safety Fostering a safety culture where no person is injured and with 15% of annual Achieve zero compensation incentive plan tied directly harm by building to safety goals capacity in our people, plants Introducing human and organizational and processes performance programs that empower
Slide 36: Promoting Diversity and Inclusion
Promoting Diversity and Inclusion ✓ Created a global and regional Tronox Diversity Inclusion Network Foster and build ✓ Conducted a gender equity pay analysis a workplace that and adjusted where needed reflects the communities in ✓ Launched a Women in Leadership program which we operate ✓ Piloted so
Slide 37: Supporting Our People and Communities
Supporting Our People and Communities We combine our global vision with Promoting Equitable and local action Accessible Education in South Africa Tronox donated a state-of-the-art We work together computer laboratory to Mbuyiseni High School, where students did not with our neighboring previously ha
Slide 38: Our Efforts are Supported by Strong Leadership and Governance
Our Efforts are Supported by Strong Leadership and Governance Recent Accomplishments Promoting robust Ongoing engagement leadership and with our stakeholders: ✓ Created detailed plan to align our business to a 2°C global warming scenario and track upstream Scope governance, with a • Occurs at local,
Slide 39: Aligning with Programs and Ratings Agencies
Aligning with Programs and Ratings Agencies Signatory to UN Aligned with TCFD Proactively providing Global Compact and SASB reporting robust disclosures required by third parties Tronox Holdings plc | tronox.com | Confidential & Proprietary | © 2022 2022 Tronox Investor Day 39
Slide 40: Protecting Our People and Our Privilege to Operate
Protecting Our People and Our Privilege to Operate 1 2 3 4 5 Purposeful Protecting Keeping Our Leading with Supporting Investments Our Planet Commitments Safety Our People Investing in our Leaving the Earth Sustainability and Maintaining an Striving to be a people, projects and and our communities E
Slide 41: Positioned to Win
Positioned to Win Jeff Engle | SVP, Commercial & Strategy
Slide 42: Positioned to Win
Positioned to Win 1 2 3 4 Delivering on Competitive Customer- Long-term Commitments Advantages centric Focus Investment Focus Tronox has delivered A shift in TiO2 market Proven track record on commitments to to net short feedstock of delivering for Forward-looking change the TiO2 position has set cu
Slide 43: In 2019, We Described How the TiO2 Industry Had Changed
In 2019, We Described How the TiO2 Industry Had Changed… Margin Stability program presented at Investor Day 2019: • Programs in place to decrease volatility • Improved alignment with our customers to enable a win-win collaboration Tronox Holdings plc | tronox.com | Confidential & Proprietary | © 202
Slide 44: Last Three Years Demonstrated the Changed TiO2 Landscape
Last Three Years Demonstrated the Changed TiO2 Landscape What changed during the 2020 – 2022 COVID-19 pandemic period • Increased % of sales under contract following Chinese product shortages in 2020 • High sulfuric acid costs negatively impacting sulfate producers • High freight costs and duties re
Slide 45: Several Factors Have Supported the Changed TiO2 Dynamics
Several Factors Have Supported the Changed TiO2 Dynamics Structural Changes • TiO2 producer landscape • Lack of investment in feedstock market leading to higher feedstock / pigment demand imbalances • Chinese capacity growth expected to be relatively in-line with demand as Chinese government increas
Slide 46: Tronox’s Strategy is a Differentiator
Tronox’s Strategy is a Differentiator Commercial Investment in Advantaged approach Global newTRON Broad product cost structure and margin footprint to enable offering to and vertical Innovation stabilization positions increased meet our integration to focus are key parts Tronox close production cust
Slide 47: Global Footprint and Vertical Integration Result in Security of Supply
Global Footprint and Vertical Integration Result in Security of Supply Sales by Product1 Balanced Geographical Sales Feedstock & Other Products 8% Zircon 13% 21% 39% 33% Paper & Specialty TiO2 6% Paints & 79% Coatings Plastic 60% 13% 7% Better insulated from ongoing macro Vertical integration allows
Slide 48: Vertical Integration Proves Critical Given Structural Supply Shortage for Feedstock
Vertical Integration Proves Critical Given Structural Supply Shortage for Feedstock Global Feedstock Supply / Demand Balance Outlook High Grade Feedstock Price Trend (Indexed) 12,000 10,000 '000 TiO2 Units (MT) 8,000 Supply That Is Needed 6,000 4,000 2,000 - 2020 2021 2022 2023 2024 2025 2026 2017 2
Slide 49: Zircon Adds Significant Value
Zircon Adds Significant Value Global Zircon Supply Demand Balance Zircon is a co-product of TiO2 mining Zircon 1,600 Tronox is world’s 2nd largest zircon producer • ~297,000 tons of capacity Long-Term • R&D group devoted to zircon Fundamentals 1,200 Largest production capacity of portfolio at Namakw
Slide 50: Our Customers Value Our Differentiation and Reliability
Our Customers Value Our Differentiation and Reliability Proven Track ~20 Years ~50% Record of Avg Length of Relationship % of Total TiO2 Sales Represented with Top 20 TiO2 Customers by Top 20 Customers Delivering for Customers • Strong relationships with diversified customer base of ~1,200 on six co
Slide 51: Commercial Approach is a Competitive Differentiator
Commercial Approach is a Competitive Differentiator • Previous TiO2 cycles have been "self inflicted" – recessionary impact on TiO2 lasts 2 quarters or less • Driving differentiated market • Thoughtful in our commercial approach – “not all in one bite” • Reduced volatility and less impact on pricing
Slide 52: Tronox Commercial Approach Focused on Long-Term
Tronox Commercial Approach Focused on Long-Term TiO2 Competitor Indexed Pricing Effective, value- 140% enhancing pricing 120% strategy while building long-term 100% customer relationships 80% 60% Building both shareholder and 40% customer value through balanced use of Margin 20% Stability Agreements
Slide 53: Tronox Produces a Wide Variety of Products
Tronox Produces a Wide Variety of Products Mineral Sands Titanium Dioxide (TiO2) • Ore deposits that are mined to • Inorganic white pigment used mostly produce TiO2 feedstock → Ilmenite, for coatings and plastics Leucoxene, Rutile • TiONA® and TiKON™ brands Ultrafine and Specialty TiO2 Titanium Chem
Slide 54: Innovative New Products for Existing and New Markets
Innovative New Products for Existing and New Markets Recently Launched Pipeline Full for New Products Will TiO2 Products Core Product Fuel Additional • TiONA® 244 for premium Development Topline Growth plastics product • Multiple next generation • TiO2 products designed for • TiONA® 592 high-perform
Slide 55: Positioned to Win
Positioned to Win 1 2 3 4 Delivering on Competitive Customer- Long-term Commitments Advantages centric Focus Investment Focus Tronox has delivered A shift in TiO2 market Proven track record on commitments to to net short feedstock of delivering for Forward-looking change the TiO2 position has set cu
Slide 56: Q&A Session & Break
Q&A Session & Break
Slide 57: Operational Excellence
Operational Excellence Russ Austin | SVP, Operations
Slide 58: Safe and Sustainable Operations
Safe and Sustainable Operations 1 2 3 4 Superior Competitive Operational Global Position Advantage Excellence Business Transformation Maintaining position Ensuring vertical Agile operations and as world’s largest integration remains a higher output while Leveraging vertically integrated competitive
Slide 59: Operations Overview
Sites Operations Overview Tronox Corporate Chloride Pigment 6 Continents Sulfate Pigment Mineral Sands Operational Offices 6 Mineral % Employee Distribution Sand Mines 9 TiO2 Pigment Plants 5 Upgrading Facilities TiO2 Capacity 940 KT Chloride 138 KT Sulfate 1,078 KT Total Tronox Holdings plc | trono
Slide 60: Superior Competitive Position as Most Vertically Integrated TiO2 Producer
Superior Competitive Position as Most Vertically Integrated TiO2 Producer ✓ ~85% of pigment production ore needs met from mining and upgrading operations ✓ Full utilization of mining and feedstock assets – more efficient production at a lower cost ✓ Optimizes targeted feedstock and grades depending
Slide 61: Superior Competitive Position as Most Vertically Integrated TiO2 Producer
Superior Competitive Position as Most Vertically Integrated TiO2 Producer Investing in mining expansions to sustain our vertical integration advantage Option to acquire Jazan facility at “Sustainable Operations” newTRON will enable digital transformation and further deployment of operational excelle
Slide 62: Introducing Tronox’s Enhanced Operating System
Introducing Tronox’s Enhanced Operating System Investor Day 2019 Achievements Since 2019 Today Manufacturing Excellence Evolution to Enterprise-wide Model ✓ Connected sites into integrated business planning system ✓ Rebuilt and standardized organizational design ✓ Implemented the design template ✓ A
Slide 63: We Have Created Centers of Excellence to Support Operational Outperformance
We Have Created Centers of Excellence to Support Operational Outperformance Develop projects Technology Sustainability globally, deploy Mineral locally Recovery Chlorination Waste Finishing • Leads and Subject Matter Sulfate / New Base Experts located around Products the globe Ultrafines Oxidation G
Slide 64: newTRON: The Digital Phase of our Operational Excellence Journey
newTRON: The Digital Phase of our Operational Excellence Journey Enhanced Efficient Automation Maintenance Implementing advanced Using technology and data to process controls to improve enhance predictive process stabilization maintenance and increase plant uptime $150-200 per ton expected annual ru
Slide 65: newTRON Processes
Transforming Our Operations Producing Safe, Quality, Low-Cost, Sustainable Tons Holistic Approach Enabling Goal Achievement ERP SAP newTRON Change Advanced Step Advanced RWM Data Analytics & newTRON integrated Predictive Process Control Maintenance (with S/4HANA) OE Governance processes & systems Pe
Slide 66: Operational Excellence in Action: 5S at Namakwa
Operational Excellence in Action: 5S at Namakwa Tronox Holdings plc | tronox.com | Confidential & Proprietary | © 2022 2022 Tronox Investor Day 66
Slide 67: newTRON in Action: Advanced Process Controls
newTRON in Action: Advanced Process Controls – “APC” APC value delivery is exceeding expectations 1. 1 Head temperature Before APC variation reduction Chlorinator Health Trend 1 2. 2 High frequency and 2 magnitude of pour 3 back set-point changes by CRO 3. 3 Coke ratio stability improved – coke rate
Slide 68: Operational Excellence in Action: Global Dashboard
Operational Excellence in Action: Global Dashboard Tronox Holdings plc | tronox.com | Confidential & Proprietary | © 2022 2022 Tronox Investor Day 68
Slide 69: newTRON: Manufacturing Advantages
newTRON: Manufacturing Advantages Operational excellence processes aligned with newTRON technology LEVEL 4 Enterprise Resource Planning (ERP) ERP = Enterprise Months Business • SAP plus bolt on functional applications such as Resource Planning Planning & maintenance scheduling and reporting and Inte
Slide 70: Future State of Tronox: Where Are We Headed?
Future State of Tronox: Where Are We Headed? People Process Technology • Continue training, • Standardizing global • Committed to rolling out coaching and vision to processes our ERP and operations ensure our people information systems • Rolling out new processes understand the process and every mon
Slide 71: Safe and Sustainable Operations
Safe and Sustainable Operations 1 2 3 4 Superior Competitive Operational Global Position Advantage Excellence Business Transformation Maintaining position Ensuring vertical Agile operations and as world’s largest integration remains a higher output while Leveraging vertically integrated competitive
Slide 72: Investing in Our Assets
Investing in Our Assets John Srivisal | SVP, Business Development & Finance
Slide 73: Investing in our Assets to Deliver Significant Value
Investing in our Assets to Deliver Significant Value 1 2 3 Strong Track Operational Securing Our Record Excellence Advantage Demonstrating Delivering meaningful Investing in vertical excellence in and long-lasting integration to execution, including improvements and maintain our commitments made cos
Slide 74: Track Record of Strong Execution
Track Record of Strong Execution Demonstrates strength of vertically-integrated, cost-focused strategy Cristal Acquisition Synergy Performance 2020 Synergies Breakout Exceeded our synergy target EBITDA synergies 2 years ahead of schedule directly impact P&L Other 2% EBITDA Cash $243 15% 85% $220 $17
Slide 75: Continue to Take Actions to Combat Cost Inflation
Continue to Take Actions to Combat Cost Inflation Fixed vs. Variable Integrated Pigment Manufacturing Costs Cost Components Pigment Mining Other 14% 13% Fixed 25% 34% Maintenance 11% 8% 10% 68% 62% Labor 14% 8% Utilities 5% Process 22% 17% Chemicals 75% Variable 66% 38% Feedstock 39% 38% 32% 2020 20
Slide 76: Key Capital Projects Support Long-Term Strategy
Key Capital Projects Support Long-Term Strategy Vertical integration and focus on growth and cost reduction position Tronox as a leading TiO2 producer with superior financial performance newTRON • Strategic, multi-year, global digital transformation to support growth and cost reductions • 2021A EBIT
Slide 77: newTRON Will Drive Significant Run Rate Savings
newTRON Will Drive Significant Run Rate Savings Costs & Benefits by Year EBITDA Run Rate ✓ Pre-funded based on Benefit Breakout realized one-time cash 250 Volume benefits Cost Savings Contribution 200 68% 32% ✓ Annual run rate benefits 150 of $150-$200 per ton 100 expected by end of 2023 $Millions B
Slide 78: Investing Now to Secure Future Vertical Integration
Investing Now to Secure Future Vertical Integration Ample titanium ore reserves for 2035 and beyond Mine Production Forecast 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 Australia Snapper Atlas Campaspe Other Deposits Eastern Ops Ginkgo Gingko /
Slide 79: Atlas Campaspe Soon to Come Online
Atlas Campaspe Soon to Come Online High value project, supporting our vertical integration strategy • Replaces supply from Snapper / Ginkgo mines, which are at end of life • Maintains ~85% vertical integration, without Atlas Campaspe vertical integration falls to 70% • Provides much needed high-grad
Slide 80: The Value of Vertical Integration
The Value of Vertical Integration Clear and Annualized TiO2 Pigment Cost Zircon Contribution compelling 2020 2021 2022E financial benefits Zircon is a Limited co-product incremental from vertical of TiO2 cost to 49% 50% 48% mining extract integration: 61% 59% 62% Other Tronox is the 7.4MT in 2nd lar
Slide 81: Additional Upside / Growth Potential Opportunities
Additional Upside / Growth Potential Opportunities Mine Jazan Option Acquisitions Developments • Currently producing much • Opportunistically evaluate needed high-grade feedstock, strategic acquisitions • Optionality to bring mines on- but still work to get to operating line earlier or later, depend
Slide 82: Investing in our Assets to Deliver Significant Value
Investing in our Assets to Deliver Significant Value 1 2 3 Strong Track Operational Securing Our Record Excellence Advantage Demonstrating Delivering meaningful Investing in vertical excellence in and long-lasting integration to execution, including improvements and maintain our commitments made cos
Slide 83: Delivering Robust Financial Performance
Delivering Robust Financial Performance Tim Carlson | SVP, Chief Financial Officer
Slide 84: Delivering Robust Financial Performance
Delivering Robust Financial Performance 1 2 3 4 5 New Long- Leading the Strong Cash Shareholder Clear term Targets Industry Flow Value Creation Priorities Confident in Market leader due to Enabling strong cash Generating Maintaining clear achieving our new the strength of our flow and balance signif
Slide 85: Executing Our Strategy and Delivering Results
Executing Our Strategy and Delivering Results Pro Forma Revenue Pro Forma Adjusted EBITDA Free Cash Flow1 ~48% CAGR $468 ~9% CAGR $3,572 ~18% CAGR $947 $3,008 $2,758 $681 $668 $214 $160 2019 2020 2021 2019 2020 2021 2019 2020 2021 Adjusted EBITDA Margin FCF Conversion2 ($M) 23% 24% 27% 71% 71% 71% N
Slide 86: Healthy Balance Sheet Supporting Future Value Creation
Healthy Balance Sheet Supporting Future Value Creation • Achieved 2.5x net leverage on TTM basis Net Leverage2 – Reduced total debt by $740M in 2021 4.0x 4.1x – Achieved $2.5B debt target in Apr 2022 through refinancing 2.5x 2.1x 1.0x - 1.5x • Q1 2022 refinancing reduced cash interest, extended matu
Slide 87: Strong Capital Allocation Track Record
Strong Capital Allocation Track Record Capital Allocation Overview ($M) Capital Allocation $1,077 Priorities 6% • Investing for growth $714 4% 69% • Dividend increases evaluated Dividends annually 40% Share Repurchases • Anticipate relatively even split of 23% $235 Debt Retirement cash available bet
Slide 88: Investments Today Support Growth and Profitability Tomorrow
Investments Today Support Growth and Profitability Tomorrow Flexible projects Annual Capital Expenditures ($M) and initiatives $400 – $425 where capital spend can be Growth / Cost Reduction adjusted as needed $272 $234 • Focus on high-return projects, with total capital returns of 25% $195 Vertical
Slide 89: Tronox’s Existing Tax Attributes Will Drive Continued Benefits
Tronox’s Existing Tax Attributes Will Drive Continued Benefits Gross Tax Estimated Tronox has Estimated Cash Tax & Attribute Savings ($M) Loss Carryforward Cash Tax Benefit Significant Long-Term $121 Attributes $60- US Federal NOLs $4.3B $0.2B1 $90 • 2023 – 2025 Tax Attribute $70 savings anticipated
Slide 90: Long-Term Financial Outlook
Long-Term Financial Outlook 2021A 2025E Assumptions • Pigment volumes → ~2% CAGR • Pigment pricing → less than 1% CAGR Adj. EBITDA ($) $947M $1.3B – $1.5B • Zircon volumes → ~2% CAGR • Zircon pricing → ~2% CAGR • $100M to $150M cost savings • Improved pricing, increased volumes and cost savings (net
Slide 91: A Clear Path to 2025E Adjusted EBITDA & FCF
A Clear Path to 2025E Adjusted EBITDA & FCF Tronox’s 2025 2022E – 2025E Adjusted EBITDA Targets are $1.3B – $1.5B achievable through top line $75- growth as well as executing against our strategy to 2022E Adjusted EBITDA Price Volume Cost Savings Inflation 2025E FCF reduce costs and 2022E1 – 2025E F
Slide 92: Resilience Across Economic Scenarios
Resilience Across Economic Scenarios Flexibility to lever inventory, working capital and capital expenditures GDP GDP Recession Case Upside Case Adj. EBITDA $800M – $1B $1.5B – $1.7B Adj. EBITDA Margin 24% – 26%+ 32% – 34%+ Free Cash Flow $300M – $400M $850M – $1B Upside & Recession • TiO2 volumes d
Slide 93: Narrowing FY 2022 Guidance
Narrowing FY 2022 Guidance As of June 16, 2022 FY 2022 Comments • Increasing the bottom end of the range given performance year to date Adjusted EBITDA $1.075 – $1.125B • Assumes continued logistics and supply chain challenges (Prev. $1.025-$1.125B) offset by anticipated pricing increases and higher
Slide 94: Delivering Robust Financial Performance
Delivering Robust Financial Performance 1 2 3 4 5 New Long- Leading the Strong Cash Shareholder Clear term Targets Industry Flow Value Creation Priorities Confident in Market leader due to Enabling strong cash Generating Maintaining clear achieving our new the strength of our flow and balance signif
Slide 95: Closing Remarks
Closing Remarks Jean-François Turgeon | co-CEO John Romano | co-CEO
Slide 96: Q&A Session
Q&A Session
Slide 97: Thank You!
Thank You! This concludes Tronox’s 2022 Investor Day Please reach out to Jennifer Guenther, VP Investor Relations with any questions: Investor.Relations@Tronox.com
Slide 98: Appendix
Appendix
Slide 99: Reconciliation of Net Income to EBITDA and Adjusted EBITDA
Reconciliation of Net Income to EBITDA and Adjusted EBITDA (NON-U.S. GAAP) 1 TRONOX HOLDINGS PLC - 2019 figures are proforma to include Cristal. RECONCILIATION OF NET INCOME TO EBITDA AND ADJUSTED EBITDA (NON-U.S. GAAP) (UNAUDITED) (a) Represents non-cash share-based compensation. (Millions of U.S.
Slide 100: 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 ATTRIBUTABLE TO TRONOX HOLDINGS PLC (U.S. GAAP) TO ADJUSTED NET INCOME ATTRIB
Slide 101: 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 provided by operating activities to free cash flow for the following periods: Year Ended December 31, 2021 2020 2019 2018 Cash provided by oper