TROX - Earnings call transcript Q3 2021

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good morning, everyone and welcome to the Tronox Holdings Q3 2021 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please also note, today's event is being recorded. And at this time I'd like to turn the conference call over to Jennifer Guenther, Vice President of Investor Relations. ahead. go please Ma'am,

Jennifer Guenther

Chief welcome On third John our Co-Chief Tim Jean-François and call Romano XXXX and Turgeon, Carlson, and Officers; webcast. call Executive Officer. to you, quarter our conference and Financial Thank today are

move We Those today's broadcast our of as have already Internet call. website by through should will listening them. slides be through using we you

at For access them can done so, those you listening by our telephone, investor.tronox.com. website if you haven't already on

and the today's Moving certain made summarized call not represents to factors and in specific Slide best on and risks presentation but reminder based A statements various to, uncertainties, and information forward-looking include our judgment provided comments that information our information. on X. friendly are subject website SEC our to the This on limited including, in this our that filings.

actual obligation statements. However, undertakes company these may any on forward-looking revise based results uncertainties. risks The and vary to or update no

call, that Reconciliations the useful provided the non-U.S. in earnings we nearest believe our certain are the will to to in During terms GAAP of U.S. in our their and release in of accompanying performance. company's use appendix the presentation. management evaluating we and conference business refer terms to investors financial are GAAP the

X, Moving John? over to to now John it's to turn Slide Romano. pleasure my the call

John Romano

of mines to continents. on overview and pigment plants Jennifer, quick X stage the set upgrading this integrated and like We're joining good with TiOX X facilities morning largest I'd a vertically Thanks, morning, providing with today. everyone, for and the you X X us producer by you world's thank Tronox.

Europe, Pacific. East distributed billion $X.X and across approximately Africa, totaled the is which revenue Asia XX-month fairly trailing and evenly Middle Americas, Our

our pigment than million capacity of customers. well-balanced X.X more Our of base tons global XXXX supports

our needs, customers. for vertically feedstock integrated this approximately and consistent supply model internal and our ensures secure XX% of business supplies Our

capacity. of approximately TiOX value producer to In as we with tons second zircon world's addition XXX,XXX of production largest significant generate the

and very we've years created following transformative the are for will acquisition to and of our We proud generate the have organization continue ago two we value the stakeholders.

maintained another Slide improved Turning have generated commodity we've costs. for our cash pricing business freight flow deleveraging quarter We savings allowing of our free this and of X, differentiated offset quarter targeted to margins, record strong increased our and as from expanding cost objectives. model, ahead execution

higher our third markets of across volumes prices products. to along our in owing zircon for selling recovery both to The TiOX for saw a the end prior with demand quarter average compared and year, continuation sustained strong

with schedule cost capital our digital newTRON track on remain enable the implementation to will projects progressing on long-term Additionally, provide that transformation reduction. meaningful

The logistics by X, prices which challenges driven the and income volumes our was throughout the diluted decline we and to as was Slide in have higher we average were lower This Net very that year-over-year, and to and line third quarter. quarter. million third they our quarter last persisted production per isolated flagged by previously this the selling a and quarter increased average were are XX% issued pleased Sequentially volumes. guidance. with in in Revenue prices Turning results selling represented with offset higher for early been since but [indiscernible] issues availability quarter, anticipated as $XXX earnings impacted due the resolved compared higher adjusted million. quarter at of X% figure volumes quarter increased a due between redemption our per offset $XXX EPS increased exchange costs. improved diluted company energy the process share middle by sites, difference absorption prior third delivered and EBITDA zircon primarily pigment were costs, of million, and year guided $XXX prices costs improvement of and record unfavorable for and freight quarter. were selling across average the The debt earnings products, our mining higher partially adjusted in, with year-over-year $X.XX in rates, chemical This to range TiOX or came and to adjusted $X.XX. Tronox due is and another share and EPS all

EBITDA year-over-year to portfolio. to product We our improvement favorable deliver the third having pricing, lower was the fixed our quarter of cash improvement owing basis on our flow benefit million initiatives. of and on in due in adjusted relative differentiated absorption business a enabling zircon $XXX to record and focused mix a point model XXX increased integration margin Our co-product cost cost ability XX%, free generated market and costs ongoing to favorable our vertical as feedstock

to We long-term continue times within ratio our billion range net ahead $X.X deleveraging in well X and leverage quarter to timeframe. of of X our stated debt targeted times total X.X XXXX reducing the to

our performance to commercial review more X, Slide I'll detail. in now Moving

Pacific $XXX saw As of remained driven pricing third normal volume selling demand continuation on prices led and due trends in TiOX guided Volume strongest end quarter of Volumes leading on average TiOX driven strongest of the XX% supply by to XXX%. the by Africa, on below X%. previously X% revenue also increase was to XX% an on the highlighted, pricing increase million, double-digit offset volumes our a local that regional increase Zircon revenues supply U.S. was initiatives. at prices to and record. XX% growth to and XX% and were continues third the the and basis, average throughout prior bottom revenue TiOX in saw inventories local record year-over-year and in outstrip the growth volumes This selling it an our strong volumes Compared by year-over-year saw quarter high of strong a declined up a on XX% levels increase compared by declining XX% increased the chain. was a the third both driven Europe, by currency TiOX in range. second Middle in the quarter, East increase to year. sustained Asia basis. as quarter demand, currency prices

from to external year-over-year sales feedstock average in prices. sales to quarter sequentially the the selling partially offset As in the year, pig iron prior higher higher revenue second compared increased other declined and and due Feedstock inventory anticipated, no zircon due to by quarter. borrowings products declined

increased Our and with our our global vertically third line JF navigated model. very tirelessly driven and dedicated our deliver once guidance. by results team We're the working proud numerous unmatched quarter to our in quarter-over-quarter quarter by with revenue pig employees of of are financial iron again external our for higher we leveraging business to footprint ensure pricing. integrated I through challenges the are of way basis choice team supplier customers, this

chain to In demand and the with growing meet over anticipating full we we fourth volume for to is to outpace demand. fourth JF? trend review place, an supply expected year Pricing the volume quarter. call have continue Given of to is we consistent to the XXXX Zircon fourth is be to sales TiOX expect levels; levels to with supply. lower digits quarter, the above be continue operating initiatives in quarterly inventory movement the now expected fourth believe to the remain in customer expected normal, turn JF quarter offset to and volumes remained to quarter due levels in to headwinds the volumes and down EBITDA will increase this mid-single XXXX. than improvement third XXXX. strategic Zircon we've with in XXXX coupled expected are quarter flat quarter disruptions. are for below profitability the our more more the pricing well-positioned than in performance those however, on I'll we We're now production continued continue basis line in elevated levels. in to seen

Jean-François Turgeon

Thank you, John.

Tronox. increase Moving plant, from and our and higher the both, improvement by cost purchase cost FX prior-year and level commodity freight to due price, a Slide such sulfur, commodity absorption rate reduction adjusted costs and as sequential partially logistic freight across costs. as $XXX continue absorption initiative. impact pricing FX Inflationary offset favorable favorable higher our rate. will and increased to Botlek improved all drove Higher production or facility, largely costs resumption EBITDA, commodity trend increased well improved we increase record the have increased were costs. but were a and been in initiative. in pigment as by earnings, unfavorable as to production in rate and above John offset rutile offset energy increased cost including anticipated. in With for comparison, the by EBITDA of partially and products the improvement cost comparison, costs quarter and synthetic of at EBITDA increased continue commodity were freight basis, our production normal was X, by price support the offset sequential fourth external at pressure, cost by The production another mentioned, Within On offset year-over-year, significant rate which volume million previously

critical. continued when and to our are and mining year. additional in run a XX,XXX rate increase at our produce us However, QX upgrading high allow This combined facility at next planning an integrated to time production with operating tons capability will feedstock

Turning I'd like capital to update our on an provide to projects. Slide key X,

initiative to remain our the transform our our reduction enterprise-wide to We us newTRON, customer. that enhance producer among cost TiOX enabling will continue cost to project business progress lowest and service

automation supply and global spend, maintenance this standardize an enhance will through We throughput, reduce chain, and achieve optimized process.

with across million reduction be outlay the newTRON by newTRON will XXXX Approximately balance XXXX. expected $XXX remains year to for invested of capital XXXX. of expect cost XXXX. project $XXX invested the $XX be to combined ton The number We unlock in this end per $XXX to and

project Our mines can expected at half rutile in This will feedstock vertically These or be in in mining Eastern Tronox investing differentiation high-grade supporting next second feedstock, per high-value market $XX XXXX. represented in XX% abundant the XXXX. to relative high-grade processing the This existing in approximately integrated of and price. $XXX online expenditure will best are saving production. ilmenite sustain Australia are rutile in ton business XXXX for Snapper/Ginkgo the synthetic source investment natural capital elements least is and slag million and come our replace our of is model of Estimated internalization suitable average to zircon and of portfolio. direct $XX pigment production phase million

in to the operation slagging want We also on update Jazan. you

We modification and the commissioning the technical We anticipate progress. production is cold slag currently first hot commissioning this have and completed late quarter. in

would However, projects be assume site. the achieve current sustainable journey a our reminder, before on reach fourth and on allow Tronox XXXX. deliver quarter of could must key as our are to will stakeholder. At ownership site operation the us transformation of operation production Tronox, to will earliest the on of plan, we these a Based commitment sustainable the slag

I We to will of Tim Tim? projects. now will the Carlson. market on continue to turn updated these keep the the call progress over

Timothy Carlson

On quarter. capital and financial review JF. XX, you, our end resources the Slide position, of the liquidity Thank I'll at

net of leverage $X.X net of times achieved X.X XX-month billion and in X leverage from third X a was from the end early, at XXXX. to of we trailing years on down at with significant reduction quarter debt billion, quarter balance times X the end $X.X This target the basis, of XXXX. times, Total the a X.X

We to are QX cash equivalents, under billion expect XXXX. Total and gross way including target to $XXX million and in well was as achieve revolving reach our no we later $XXX XX available available $XXX cash than September credit liquidity on agreements. which $X.X of our debt million million

right the were year-to-date on page, hand expenditures quarter basis. in the to totaling the a side million, $XXX $XX Moving capital million third of a

million of and to and the of reflecting pacing other newTRON $XXX in capital maintenance anticipating currently projects are the QX expenditures spend. capital related Atlas-Campaspe expenditures We

$XX depletion Depreciation, Our million million. total now year is and was in amortization the $XXX quarter. outlook expense approximately

Our the to strong form we million cash of $XXX due free dividends. earnings. million returned was our year-to-date in also to flow Year-to-date million $XXX shareowners in the $XX totaling cash quarter

XX, Slide outlook. to to I'd Turning share like our

zircon outlook ongoing TiOX the we and are progress increase to constraints. our continue to and global chain pricing market prices balancing TiOX market our both demand very mentioned, John are strong, make supply logistics with initiatives. as remains expected and we As regional and with

fourth XXXX though expect quarter sales remain to tier levels. than levels, volumes QX flat and quarterly lower elevated We mid-single XXXX Zircon be down are X to volumes volume to above digits. expected

relatively due million favorable We product expect EBITDA rates $XXX on freight, some their $XXX less a lows have adjusted be sequential net-net mix. basis. expected are to higher our remain logistics and recent and million and challenges, to FX commodity come costs off to QX neutral XXXX to

of cash. related uses our to expenditures taxes, interest Net million, $XXX XXXX, to million we for the which to expenditures contributions and million anticipate approximately year cash to following $XX of $XXX than million newTRON of $XX of less expectations Moving $X million $XXX cash capital pension million. and Atlas-Campaspe expense of full includes

in estimates sight, based annual call for capital increases, target cash gross $X.X capital repurchases. -- for billion before These for represent our and closing We JF With of our JF? current source to to with a questions. outlook. upon we debt I'll turn modest dividend expect over regard the capital repurchases remarks the prioritize expect shareholder working up be best expenditures, year. our allocation, call to continued the share back to now opening market

Jean-François Turgeon

close we month year. Thank effort, you, final call head to our spending as the strategy, Tim. minutes We few the a want sustainability takeaway of and key the on into by

First, XX, the revisit on our footprint, competitive technology, people, global global our which the an built on and five Slide integration, to want TiOX become strategy the I leader to the pillars; advantage vertical is costs.

these projects capital dedicated to Our pillars and Atlas-Campaspe. expenditure will be pursue newTRON and effort through like

technology our a costs operation leader. our will automation enabling and transform through of reinforce feedstock are digitization, to distinct reducing our fundamental Atlas-Campaspe Tronox which both through will be in advantage and integration. newTRON outlined, I As

leverage optimize most leader, our our and our to deliver the drives adaptable strategy industry to portfolio secure Our continue unique to ability as industry-leading resilient allowing TiOX us our financial assets performance. position to

we as Turning differentiate Slide related is everything part tons long we ourselves. it's key we efforts has low Though at performance safe, and our increasingly how stakeholders. improving been how XX, critical progress will ESG for become disclose Tronox, of to do producing we part a our our a are to cost, sustainable of and strategy sustainability quality,

commitment harm. the published X for which the quarter, to structure Celsius our sustainability waste enhance and XXXX. dedicated third committee our landfills the our global goal incidents, external detail achieve oversight company's report Zero, sustainability. reorganization is in oversight board which zero injuries, to the disclosure improvement annual plans and During with and below we of future. of features July and ESG ESG to to also net ongoing align announced and zero efforts. by highlight achieve zero enhanced report initiative on gas is commitment Including emission The an zero zero of We Journey scenario warming greenhouse to our to of and to increased aspirational the evidence degrees The

in so of our is a Tronox. Slide by employees, to is to without today's assets so for to ongoing up your we position, stakeholders. for position wrap dedication capitalize want continue ability would prepared XX, thank to to last This has Moving year to the and as time Tronox for our efforts. in the organization our a to critical and outstanding several our commitment I market With our to moment confident review remarks, been a you our XXXX everyone we momentum not due are years. far take This great throughout portfolio Tronox. possible the on on be deliver our

the with which We our continue turn call over remains while company concludes to to the questions. ensure future current challenge navigate bright. transforming macro for our That prepared our remarks, I'd will Jaime? like that

Operator

Please go from comes Our Fermium Research. today ahead Mitsch question. from Instructions] with first Frank [Operator question your

Unidentified Analyst

can maybe XXXX year dynamics guys, the walk the on My world up the pricing TiOX shaping nominations environmental for with on explain around into American how Lisa the was, us Good and and first North through Frank. question and crackdowns you particular China? of in end morning the it's interest are

John Romano

we moving regions. and supply. the continues seen We're region, up in pricing, From guidance what our a And in just not Yes, this demand pricing demand, thanks that quarter into fourth not to in provide quarter, with moving one we with would lot of would be Lisa. we've the pricing through to that fourth globally. continues to or outpace did on is Romano, we're all increased the demand going line see standpoint again John the of seeing moving say regards XXXX, it's

when in volume So about are our issues. still strictly the limiting where think we XXXX, volume What's today through quarter current are the in we we very the fourth logistics economic about environment is growth. optimistic

discussion is place. the consumption lot now policy going that's control Okay, a and sorry, China, there regarding second energy and then of out there on question dual your in on

would capacity constrained. has has say some impacted. Our that been been not capacity I been has there that

still particular it. demand our of supply only but we speculate to a stage, at capacity sales going It's It's has exactly based this there. Again, strong, with happen to China, about Our to we at tons what the Tronox XXX,XXX good quarter anticipate know it X% to what's we above regards specifically, basis. China see about to that estimate it's on now. fourth and to would for total be our volume tough represents on

Unidentified Analyst

recent comment, following Very helpful, can defer the the in you you. announcements to industry? thank client or TiOX to any for [indiscernible] And you U.S. Thank products producers for that. from followup, provide availability concerns

John Romano

on plenty an so were one stated plenty stage, that third we call, the issue that in actually getting vertical getting the integration addressed we blend offset since some had, adjusted. that this have issue but particular now. ore been of the of the quarter our the We're we've did we Earlier and was, chlorine has in benefits of of in in As we at that quarter earlier able our impact, to of to year modify chlorine. we're

Unidentified Analyst

Thanks guys.

Operator

next Markets. question. go ahead McNulty from question Capital from with your BMO comes Our John Please

John McNulty

question. Yes, good Thanks for my morning. taking

at the about at from to like their that? still environment of kind at it let production terms how a appears a guess, of speak across a we demand industries kind from be where some around what I you get back demand restock can of given, a phase? guys supply the inventories be to are chain how pretty inventory normalized guess, thinking to alone take point should just strong feet host in kind long on of So, point. to I whole and inventories again, especially having the anemic issues of really of this looks others industry, between levels we're kind realistically you

John Romano

look comment Yes, make with regards on I'll Tronox. to so that a

have We some are can hard this as There running limitations. we our at stage. as assets particular been

seasonal well built rebuild. to that's because every but this chain our have starting stage, we So for see we're to on this in any the the of it's at I we inquiries supply a perform of there's hard we're point next -- than inventory maintain any system definitely monitor think lots Again, to your norms service year doing. questions inventory the actually bit but customer, little midyear, to -- particular at about is to We need actually stage, can in below point, what your build we being try inventory, the don't single There's effort fill. particular our levels, would not although be believe of to is to significant amount. coming more inventory volume can than we do we

we that going period pretty for low of confident inventories to So TiOX feel are remain a time.

John McNulty

capacity you're didn't TiOX the specifically that ton think Got then the issues or the chain of that I 'XX and was can 'XX. realistically whether I to a in so on was to increase I it follow-up whether XX,XXX side, having and hear versus some be clarify helpful? those that when would that, that mentioned be And on then, alleviated? as speak will side ore you you supply heard and can if that, you guess

Jean-François Turgeon

really can I XX,XXX maybe pigment with that. the John, tons of So additional capacity year. on that next for start side It's

are gas, for a that. good news XX% we going to had, Being that integrated be mine. issue mean, us. Jazan our that the so very producers come the moment of is the those major forward are for that and in So that we I costs and that delivering, and which is very on for that because had we advantage and you that's and chain specifically mentioned, the the the huge as are our it's newTRON the is well I upgrading obviously like us mines helped moment, unfortunately the to in expect gave from look in vertically and should Europe, natural value going us constraint of question start very market And old inflation a always challenge in side. other at buying And that's, from think resolved have that us mentioned QX. working roof, those increase are going project we unexpected don't the XX% and energy supply our faster confident I challenge. on feedstock, coming We're And is will cost and facility at Look biggest reductions. sorry lower our moment, obviously a than hard all our that we tight chlorine price fact we're the a very running but at to

John Romano

a sure actually element we make those of talk not freight is the our you and but of global There's freight a about there about non-contracted would too say spend lot we of anything fourth we there. that's larger think considering outbound. just percentage I'm kind out. a we cost would on When and our get of And to out unfortunately don't are containers I forecast, orders that. and you lanes inbound significant logistics shortage telling element a quarter know, historically not we then that is using to

John McNulty

Yes thanks.

John Romano

we least we're to again, what non-contracted being we freight be negotiating the costs normally line have lanes And on make we and that into the of at resolved believe of non-contracted from with move the standpoint obviously XXXX. lanes year, reference, go we some balance of of out into just as will as the would

John McNulty

the are is you fourth problems and just XXXX to you passed feels specific can on quarter that going it line? it, the happen like things this comfortable and even that finish there getting is end get of to have And can ran that take us it's one the like past if mile we either the this are are, the or because and seems in will rates I tests terms helpful. of things operating the what of like the you and I if solved before at it everything should Got and earliest Jazan, that's understand markers be all officially kind speak on is maybe just last looking of one, well

Jean-François Turgeon

assumption don't there's a because Look going it's but the informed started, as be I progress we'll to that things happen. of to it's it we've so so add how ramp year I moment, be successful much can the talk going of of we'll keep but ramp-up how at haven't at operation John, there's we look up, more and hope and we a helped. beginning ourselves. our that always We go. the have technologies, smooth when been hot few next you at a the behind commissioning conservative it's we that much to new think But months look ramp-up, in could about hopefully of able it's We're still in moment.

John McNulty

very color. it, Got much thanks for the

Jean-François Turgeon

is first the half First key.

John McNulty

it. very Thanks appreciate much okay. I the it, for Got color.

Operator

from next Our question. Barclays. question with your ahead go comes from Please Fischer Duffy

Duffy Fischer

good September, morning. out thing people want on really I came early about potential Reuters the in you to Apollo. Yes, guys article the Since mean talk the only is for

on it? you your views the just article of about could that So and genesis talk

John Romano

don’t all -- it's that Yes, really to market about mean take about not look comment article, speculation going part answer. I that's on We say so one. be that. we I'll can we're going short a that to

Duffy Fischer

that, but because doing doing nobody on view unless you a guys disservice really have invest a they mean can I that. are yourselves are understand I

just hurts nothing So the I saying I mean, story. think

my view on So it. okay, just

issue? energy, or on where can natural talked guys electricity you inflation the gas about maybe plant, is talk about by geographically where versus then you is So

Timothy Carlson

far in a question. nearly the we inflationary in headwind before transitory biggest about we've us themselves that chunk headwinds million that network in want the the in it in of our sulfuric cost-saving highlight million our great $XX the increase about in we've I increase to cost just so that rest costs I that savings There obviously UK, Brazil. controls. good but teams a and be in for QX job and savings. to programs coke, then additional saving inflation the our is next we a thanks sulfur, in we're headwinds is Natural that have so QX talked that globally with itself through for much this year. plan primarily going of issues year acid, newTRON cost savings primarily another the And a about commodity to the QX general offsetting primarily have the Commodities is are QX, $XX we've did through have gas Duffy, Yes offset with there. got got sulfur done ongoing the

a freight headwinds ability overall issue from non-contracted John gas, a lanes expand remain the despite talked those natural headwind commodities the But standpoint confident our about going of very Duffy, in is headwinds between million cost So in in about and still we that quarter. terms through in XXXX. margins to $XX in

Duffy Fischer

Great, guys. thank you,

Operator

your next David Begleiter Bank. Please comes with from Our question Deutsche from go ahead question.

David Begleiter

good Thank morning. you,

risk on throughout and given you're there can it be seeing capacity, Just on XXXX could the curve thought China, the impact dual control few cost a discuss on you your over power the last quarters? curtailments? because what's And

John Romano

already some indications A not XXXX, feedstock year. regards but cost, time. to for quarter with got every mean being energy along briefly, up could restrictions by costs that's no I into months, driven and attached that With winter largely is little it's sulfur impacted power that our colder of that up as goes, is policy to far estimate to say been there significantly stage at period are as dual it be that in question China to a that's tons we've Yes, been there this run mentioned is about has fourth how control that. going XXX,XXX hard the bit there internal it and consumption some I colder happens and by

chloride the feedstock going to both continue Feedstock to tight on any market. sulfate in We is change our haven't be opinion seen side. the really side in and

you So make I do additional don’t want to if know any JF, comment?

Jean-François Turgeon

the very power why change the the a extra expect that to in we effort linked to of on impact mining made -- very that's of limiting highly the is, pushed with that the remains don’t it with has iron high ilmenite the is and comment production I and in pressure high there the incentives ilmenite price, and this and on on that produce production high. had important reductions trend price more Maybe price interruptions iron environment China, ilmenite those for less production the is the those ilmenite thing and maintain China ore to And also this. production and other ore in ilmenite companies

David Begleiter

on future allocation good your plans and do capital? just share capital to into how go buybacks Very deploy

Timothy Carlson

$X.X to we terms issued. prudent part that dividends lot being flow for will make believe a make But flow and QX. free sustainable. our we the in get to cash share specific significant that as also provide do we to continues to and next is compensation And being being year we getting shares capital are said, do that shareowners to while sure of X more in of there priority. principle In returning free each I the increase said, repurchase that that with targeting will every increases from Exxaro target committed expect generate dilution million equity and targeting have that from dilution ensure additional to our allocation. our details But cash capital in with number be billion remain we to call expect one year-end We'll

David Begleiter

Thank you.

Operator

UBS. from go question. our And Josh Please Spector comes ahead question next your with from

Joshua Spector

my taking guys, question. hi for Yes, thanks

side cost quarter fourth in when you stay a into elevated baked of in the leg quarter the first quarter, comments? costs Just to side, out your quick cost all lay energy the is another that or fourth there specifically higher on on the that come follow-up is if

Timothy Carlson

mentioned Yes, of in believe that the given current costs come so are costs do are UK, the pass ability gas QX see within being just the but to as cost natural you the channel. our just in earlier, with the we quite it the But confident John curves also energy season given some said, down on a in that winter curves transitory, bit. marketplace, will into roll the we do these

Jean-François Turgeon

Look, being I mentioned. cost successfully running the the not add increase we improve with in gas that plants going were the cost that of and in sustaining moving but the fact been our in initiatives as of the expect so would Josh, natural high UK able we're on because we're because own price, that that our quickly. had gas XXXX moment. Tim lucky down still many so shut were price UK, of reduction There's to Look, we to that at and it's it's natural the

Joshua Spector

I a that's that And look and you are needs just but for key if no guess, when happen to inventory guys I term just mean maintain back in back is get the there get I investing integration integration needed follow-up, you some years. further look that to next timing issues, Atlas out Atlas help years is type as of wonder the I does wondering strategy, or XX to you your I Okay, Atlas was longer that? five, fair. to kind understood, if another there few investment I the materials than that's

Jean-François Turgeon

life. question mine, like Josh, very good look, any they and a So have it's a

do integration continue have So the good obviously vertical XX complete years to to more Atlas-Campaspe use with of five-year will give in level for in project within year. there that if integration we will that's I in XX-year vertical of hand already Africa expression. some to a and have we have is the could be good plan than investment so our more that resource investment news we and to us reserves and the production, South is sustain that this our have next But our

Joshua Spector

Got it, thank you.

Operator

DeYoe your with ahead from America. question Bank from Please Matthew comes go question. Our of next

Matthew DeYoe

significant committed the seen you and pretty market morning, a [indiscernible] to be you outage general been activity is ability during Good your right? But shift in Have broadly concerned seen know more ore it's summer I upstream the other so availability their of one we side? on a in competitors you've thanks. of any lead tight ores? trading that the pickup asset to just XQ, anything in or wondering if about in I'm down would bringing had

John Romano

stated Yes, not, South look, an market. tight we've I has integrated. it. disruptions we been some that -- as vertically got our clearly happened feedstock and buy made in wouldn’t XX% did extended of the standpoint on feedstock it's of and also time market we're internally the ore I We've external the period managed improve for say it would that, exacerbated Africa From

XX% fourth clearly Jazan earlier, as then with a JF? the in slag us. of integrated. we're coming It's opportunity as quarter. And got not up JF we've much first a us it's vertically for the for as So also mentioned challenge half the challenge coming

Jean-François Turgeon

it's make closely. what on to think that Matthew, that track could the is, market we're say we I look sure we no, for ready want that Yes, a that always We already year. -- coming

So a we but view. full-year to it's not have something manage quarter-by-quarter, that we try

Matthew DeYoe

Okay, and…

Jean-François Turgeon

is mine I the for us. Campaspe starting think very also of our good timing Atlas

John Romano

a when by just it's plan, XX for to a to JF's you've point, business the that's point XX-year got I the five-year think our Yes, plan about we a feedstock. for on think good plan us five-year supported

feedstock So lot we spent on. time is that of a something

Matthew DeYoe

whole is and away financial integration Snapper there expected we is statements Yes, be to from seamless to to Campaspe transition fairly that and the Ginkgo that as transition? in kind on on any build or see what from of Atlas shortfall that, you should

Jean-François Turgeon

Atlas more good as grade, when end Yes, mine, have you and new Atlas going rutile exploit, like mine and start. have a the transition we're a new benefit seamless and and zone you and start have every lower zircon production question that's a mine the there's higher ramp-up of it's when obviously a more because the a of and you Campaspe as it's Atlas, life in the start you that costs you to mine to but high-grade

Matthew DeYoe

All right, thank you.

Operator

with from question Please Alembic ahead question. Global. Hassan Ahmed next from Our comes your go

Hassan Ahmed

to you of wanted revisit feedstocks. guys. commentary Good some just I made morning, on the

of gotten of deeper longer you issues. chlorine earlier what the you have into If help the by about it could to is think talked dig into You sort of and I I wanted me on formula just of I if term through volume based have, contracts? you pricing, resolving sort mean contractually contracts you mean may the mean, any sort based nature these some contractual you struck? of duration things just have that.

John Romano

was And I guess head manage on Thanks able to our we a chlorine, a not managing filed issue. chlorine less Hamilton of was that the, Hassan. in the That supplier majeure. force specifically were contract that by on a Look the grade. volume decreased

adjust were grade, So content head of higher offset the some we TiOX use ore to that. to able

did we production been Towards resolved. process we've of referenced, have issue, the little that's a which that end

facility. what contract wasn't particular we're So a chlorine we issue. force a was It was majeure now more needed issue for getting the that chlorine than offset and

Jean-François Turgeon

issues. U.S., and there John and UK of Yes, about a good happened cut UK the majeure and happen also And the gave two we was position. Hassan, events only that in force we but and talked and chlorine feel in because power obviously those two there's the at same issue are a affected the now in loss us one that client by but to few was unfortunately, the plant in had the that a time those chlorine power resolved a we're

Hassan Ahmed

a And Reuters and follow-up, understood. article around as the sensitivities there Understood, the are understand I like.

a and matter for obviously So given, as you mean in multiple there I number specific think by levers, right? new you you to set to a completely the about look there what about very baseline valuation was of normalized cognizant situation but unique very fact is Tronox? guys. of guys multiple $XX it a that, mean, Can broadly have pertains talk share how I the are is, earnings levers a you where you for seems be

then generating So guys based one you assess sort valuation can free flow. off are that, of cash of ample

so that delevering, obviously valuation that helps well. as are You

You have NOLs.

option Jazan all which sort the of valuation have are You accretive.

is, valuation, internally the talked the about like? think stock So $XX you speculated can through are how your particularly price thinking about you that and just help number with with where me Reuters it

John Romano

Well tell so did answered a almost you, question to Hassan, the that. you good I'll yourself, job you on

Hassan Ahmed

big they pay bucks. me why the That's

John Romano

we're And on one Yes, strategy, with we been lot have regards we've we're believe I a of of everything our in also do on and we to to us project extremely we but newTRON not flow. as reducing particular just to into the most move have cost where All strong going to to confident are rumor, continue margin as our about cost debt we we're that our was we lower again move It's that cash targets this is XXXX stage undervalued. going our speculate, are growth EBITDA. the think is cost doing done and our to not doing XXXX. through going work at expansion have help important into we've though, that as we been reduce

Tim, to comment? you a want So make do

Timothy Carlson

summarized No, I think it very John. well, you

Hassan Ahmed

thank right, guys. you, All

Operator

Vincent next from Andrews Stanley. [Operator Morgan question. comes with your question Please Instructions] Our from go ahead

Unidentified Analyst

for on [indiscernible] is this Vincent. guys, Hi

a question on the Just demand side.

shortages of buying extent their has other talk then been materials they the well? purchasing you from are as are which or customers the down really slowing paint can and shouldering And you customers patterns of and [indiscernible] Given your out, but other that seeing impacts about unaffected? industries raw demand that relatively to are demand impacting

Jennifer Guenther

of can I'm sorry muffled? the question, it repeat Will, first you your was bit part a

Unidentified Analyst

seeing patterns their down been [indiscernible] short affected? are mean and impact mean, your demand right slowing relatively I were so has of guys now, buying Yes, so of purchasing I the are really you kind that that customers, they pain

John Romano

I'd would produce were that Yes, other said, that say seen I some volume of, had third that some QX. raw quarter. a moving to see into got coatings. in And impacting being we That yes specifically say we're I question. on guess peoples the I to in capability short in pickup that starting is, some, I shortage materials think the answer reduction And North America,

exported of issue. us TiOX For an to that it a we markets lot other more were wasn't

of oversold today So that exacerbated areas that required the was by industry materials, were standpoint that with where volume the are it volume we again with logistics coatings from even we raw redistributed in came well issues and we've that the from other demand and still we referenced. the into other where disruption redistributed

that's been a we is, believe think So do answer of lot resolved. I the short

for earnings larger coatings the You've indicated that, and the probably companies America coatings seeing quarter heard which into moving some of some we're healthy calls North of beyond. in of and demand the a have fourth

Unidentified Analyst

target just risks as all the your regardless parts I are follow-up question, trying mean in [indiscernible] more conditions? then a supply of of newTRON achieved chain, given in any or and there [indiscernible] to you the [indiscernible] be guys and you moving it, kind is Got the volatility

Jean-François Turgeon

we're and and track our very improving those will those help of all were those. of Look, savings assets, about and the those plant are still talk maintenance, we're our real not confident and and inflation the savings those could alleviate committed we obviously of digitalization we measure could cost but really our they're No when the are specifically the savings, automation could still are position the our transformations look to real, to we related. and committed

Unidentified Analyst

Thank you.

Operator

over and ladies I'd session. comments. any And to John we'll question-and-answer time, gentlemen, back like to conclude this today's floor with Romano At for the turn that closing

John Romano

today. call And you. again thank the for joining Thank you

enhancement, actually increase capacity meet are early the to our customers we moving just bit amount to like are well longer-term we outlined continue very of into standpoint little the think that, into I to think work significant maybe ability EBITDA of to our gone generate JF end and savings XXXX. moving we'd as of bit clearly XXXX, little we along of about XXXX. optimistic where from a the There's moving more additional regards to quarter a challenge demand our that's we're into with cycle that margin but ability up with in with opportunities to economic growth cost I a fourth projects cycle at into our an as

again and good day. your time So for thank have you a

Operator

Ladies attending. with today's we'll thank that do call. and We conference for conclude you gentlemen,

You may lines. disconnect now your

Tronox (TROX) 28 Oct 212021 Q3 Earnings call transcript