CC - Earnings call transcript Q1 2018

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Operator

Good morning. My name is Emily, and I will be your conference operator today. At this time, I would like to welcome everyone to The Chemours Company First Quarter 2018 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. you. Thank Instructions] [Operator may conference. you begin Bellezza, your Alisha

Alisha Bellezza

Executive Thank Chemours call conference Company’s Chief and good review a morning, performance discussion and call. call begin to The everyone. our quarters Welcome positions. Chief President first and with highlights; Vergnano, joined and of by you, who with today will the and Mark and conclude our will I’m who Vergnano Mark Officer, quarter XXXX Senior Newman, Officer, Mark then quarterly liquidity results business review the President will Vice Financial our outlook. financial earnings

Before that certain that as Actual as you the information. based that These expectations the involve no of including of forward-looking those risks and Chemours statements and update begin, website the presentation performance statements duty comments events well provided or like developments information future our as our are result not future undertakes are and that with to guarantees in uncertainties, call, any we filed and to in Chemours assumptions may of differ has may supplemental and SEC. described I’d forward-looking be a statements on on not documents forward-looking remind on this future new results realized. contain

this the included Vergnano. evaluating the will now are company’s adjustments I the performance. During to release to call certain of will to investors terms of believe over Mark our of management and end the non-GAAP course presentation. we and refer A call, useful turn financial measures this are that in non-GAAP at reconciliation

Mark Vergnano

joining for thank Thanks, Alisha. morning and us today. Good you

or the some and the Bellezza, to announced changes within we finance transitioning Titanium Operations of this me as all walk Commercial current Before Alisha we take minute personal Treasurer Chain and a Vice President to segment. being Supply President is Investor you well Vice role for function. of Relations our the know morning of through who let Technologies call, today’s

investors she no business global Treasurer dual Corporate the Relations. with to I him that to will Development want results. holding longer like stranger the being thank the growth being with finance key of continue role Alisha’s segment, Alisha his role, And has no Investor prior President Chemours personally In communication will Lock, introduce Sameer new IR Titanium navigator Sameer as through assume he a investors. will our and chief driving to President who face his in be source to of also of investor execution is I welcome our Treasurer. us be talents sure brings to the transformation Jonathan the from of joining Energy. With being finance key our her in move although Finance put corporate Jonathan drive to position, In Jonathan and standing to our joining Chemours strategy the knowledge transformation. can of Sameer function plan. Ralhan, our up will while is future journey, to and use also our also X-point and So, activity surrounding help are our would and relations for Chemours you Alisha. position investor oversee Technologies for the SunCoke corporate previously responsibilities, Vice of our in great Business the player been a also functions. wealth Vice also our of

by GAAP reported full-year all of doubled income at We a results. improvements the momentum to EPS began So, energized with from meaningful our execution businesses. our that quarter our notably adjusted financial XXXX performance. and on net our our driven first basis, XXXX of speed, by metrics, continued across let’s workforce and both strength full key move We the strong and

In with our growth-oriented December, fluorochemicals through capital of to our in addition to Chemours’ common approximately our business. have our new allocation welcome addition team. strategy. we ICOR April, step The authorization first great $XXX performance Since employees repurchased to refrigerant being portfolio outstanding to we We International today. current our In our announcing a on quarter International our organic shares is performance, Chemours of the stock our we enhanced execute to million want shift ICOR a on company. continue to worth of

well are details. call the turn financial now we’ve first the three-year cover quarter on provided. We our on I’ll targets Newman to to previously deliver track over financial to Mark

Mark Newman

Mark. Thanks

Slide on begin me X. Let

growth our million our when XXXX. by expanded performance. points all key to of We XX%, results. the our segments. metrics. during in Our quarter, a free of $XXX a change use XX% EBITDA while income almost and GAAP doubled a experienced Even sales rose margin to basis Adjusted profitability, transformation EBITDA XX%. from to we increased though million normal cash nearly in focus sales Net flow, strong evident growing in adjusted adjusted of our of both capital first XXXX increased XXX working on our quarter operating cash of basis significant we compared over our basis year's increases driven a of year-over-year Net several generated exhibited or across is clearly million $XXX approximately demonstration seasonal last $XXX quarter, result first in first roughly quarter on year-over-year

of rose investing set while We expect capacity XX% three-year remain the our Our ability the we level years. we pre-tax through assets, the investment above profitability demonstrating Technologies as over on are acquisition businesses. like we from International. our in organically focused our XX% target, to ROIC the even of to our grow the recent ICOR in significantly our up while projects ramp targeted ROIC in unlock Further, XX%, coming Titanium circuit existing we our high

primarily accompanied the Overall, products our were year-over-year and million next slide, drivers conversion We for year's previous Opteon to Higher the for dioxide growth recorded on of review also in in variable while drove fluoropolymer appreciation titanium in $XXX with wind chemicals resulting to results. adjusted price the Turning modestly price structure. basis. last contributed on to favorably, to including fluoroproducts year. Technologies, products. chemical of our XXXX, the $XX improvement. first year's pigments of EBITDA nice distribution demand the and solutions compared broad-based basis an EBITDA million a headwind performance. a variance. first the We refrigerant selling resulting our consistent million global increased the volume positive quarter, the excellent Titanium remain our Ti-Pure fluoroproducts overall continued In adjusted increased euro. tail quarter. to to demand by cost, to the the let’s for Within was preference average Overall, vigilant $XX favorable was $XXX of were solutions quarter a improvement provided million for we quarter, treatment Currency benefit, year-over-year year-over-year water Higher on a prices related saw however fixed costs start cost a when

Given have our added new Slide growing on a X. on chart we EPS, forecast

on year's adjusted quarter's even compared when $X.XX impressive when This quarter. negative last of the performance. EPS considering more more on first year-over-year tax effect doubled to is This than the

the in geographic from mix year's contributions I results to along last strong discrete of were business These by tax offset covered rate, earnings our the results by translated first a the of items. previous effective due the into Our segments of somewhat our change slide. each driven improvement impact versus $X.XX quarter in that the with

to negligible, Our versus share due tax quarter this XX%, the repurchases The our was in first rate was quarter. last year's quarter timing. of for XX% in impact

However, benefit we were able become the to offset anticipate dilutive more share the of repurchases to more equity future meaningful of in effect we than quarters. and compensation

Our position, I’ll on operating with next slide. generation cash the have solid additional balance results into also sheet cover translated which a

see of flexibility, our during put us provides the quarter. to can you good strength As sheet the balance we use which ample

in-line billion were: with level approximately our primary to announced to completed three ended capital additional demands, dividend in Investor along comparison growth, seasonal higher quarter investments the with uses cash organic $X.X with at of Day. fund quarter a a Our repurchases of in we balance increased We cash share $X.X capital first by use and the a after at increased Net cash XXXX. capital. quarter nearly year. $XXX to even working million support was primarily versus the flow billion year's business improvement versus quarter, with year-end our million capital flow $XXX driven strong was million, last $XX $XXX million in cash even including first of Free operating expenditures working of results last

our purchased an $XXX to We end, in million million strategy execute leaving $XX capital on million of approximately additional continue authorization. existing remaining the have million $XXX approximately Since $XXX quarter. shares our we allocation quarter repurchasing

while B, agreement a balance and Additionally, our liquidity, sheet. adding $XX new million. we while enhancing are also our approximately and In reducing to restated flexibility into entered credit term company's seven-year principle by April, Loan we amended our

the a transaction, liquidity part we five-year approximately revolver, senior revolving new $XXX facility. forma quarter-end. into As million this Including pro at our secured $X.X on new at a basis stood of billion total entered also credit

debt a basis. Our on trailing X.X XX-month approximately into net net of $X.X approximately times billion leverage ratio of translated

We balance that flow are pleased with and us. cash cash flexibility the our provides

Mark. ICOR has targeted that businesses. April, Our liquidity as and call now, in to cash the International core position And current while our given in turn consider closed acquisition I’ll shareholders to continuing in-organic of us return investing the prospects such back to the our ability

Mark Vergnano

bit points United Opteon within Europe, to and to year-over-year primarily demand the million on from full stationary EBITDA cafe mobile of in of carbon of $XXX In the next – for our improved the of in adoption, translated came into the Price to technology, our the sales line exemplifying quarter, XX% to volume Mark. moving This In by XX%, a a of year's XX% States, increases. review is increase XXXX Europe low quarter. this be increase segment basis the $XXX the side, Thanks we was the HFO reductions. across expansion quarter mix XXX both continues towards in year-over-year EBITDA Adjusted the by first and approximately Beginning was States, with over adjusted see to an with review encouraged refrigerants and segment. last GWP The market generated Opteon later. to strong the demand refrigerants for result driving margin the the segment, driven I’ll capability increased response credits. million. fluoropolymer United F-gas conversion fluoroproducts nearly continued blends which products.

Opteon acquisition of the were flat global base refrigerants, the drove acquisition April, that drive ICOR As a heating, supply enhances last we In café our safe mobile facedowns refrigerant for place, channel products that ventilation, refrigerants meet above a in was XXXX. end customer as International, to completely Europe, of are base related offset for higher our demand Europe, conditioning This a ability our North in Quota mostly the refrigerants as price countries. offset for refrigeration favorable in in in in to we volume quarter fluoropolymers, tightening our the facedowns quota also developing to America, North in impact expanding ozone well conversion rates able volume with as while year's for of completed pricing a increase access. the contractual Base by and standards, air to our current applications seventh America. the quarter products in GDP market In to and U.S. full U.S. of commitments. anticipate comparison supplier growth we market were global first needs row. in our in reminder,

global in to implemented favorable China, increased demand year-over-year, enforcement during Fluoropolymer regulation see price of XXXX. supply. paired market also the result with constricted increases from continue We which improved has trends, a environmental

our year, technology XXXX, committed additional technology. trends driven the Opteon both momentum will side GWP and year refrigerants. compared over toward fluorochemical this lead to remain We transition on are mobile requirements Opteon expected blends continued price they further Current increase market as earlier to expect topline to We in of the XXXX. adopting supporting the further refrigerants. fuel adoption announced towards grow XX% customer’s price in last move stationary We low base Opteon anticipate refrigerant by to to

storage refrigerant base for we our our quarters to regulatory flat anticipate comparison expect prices demand last At refrigerants. in the the base work electronics automotive, market leading favorable energy development with modestly As the base driven given relatively such, to and application year, in to same higher our trends a We environment for fluoropolymers. be to by tightening demand refrigerants are the of time, increase global for year. supply those in are combination managing the and

this and momentum continue expect beyond. will We through XXXX

that closely their outages third with time. we look customers ensure fluoropolymer our in planned during course working over this year, of we to supply As the the have the at maintenance We're certain met quarters. second needs facilities and are

in performance solutions $XXX income our costs. the a Moving improve quarter, authorities adjusted of related We Sales the facility in quarter technology variable to to on across and increased with result modestly. release in several anticipated been expected is against cost reflecting new our of in while our Chemical X% demand throughout construction The intermediates $XX segment. filed along year-over-year our Solutions segment has XXXX, facility. a generated complaint chemicals Mining solutions the of to lower that higher rose process as demand delayed Mexico. the the EBITDA and federal included million mentioned slide. to involved Laguna, remain mining segment is strong of in and the of Mexico higher facility permitting million local to This the distribution also in on higher construction next expense new the licensing

We questions they any to have our working the our with and regarding additional community address may operations. are stakeholders

with are our that to working community, only the in our believe Mexico. the but products serves investment Laguna We and all committed need not for market local stakeholders growing benefits also in

We sold and is will facility out, Americas. previously stated demand in to in mining remain sustained strength the our it due expect sold solutions have current that we

The review prices our by Sales Turning XX for million first $XXX versus up XX% increased dioxide, year's to $XXX to improvement Ti-Pure to higher over year-over-year. Technology quarter. Slide average Titanium driven global last primarily titanium was segment. million

affected most of also April Pacific year. X. the price material for communicated expectation communications account America were communications to with Asia The also quarter. the into certain value our North the raw while We in taking aligned strategy, recent customers These our increases remainder in and stabilization of during costs higher

year's demand volume quarter last strong recall, increased continued first a demand X% may saw saw We preference Ti-Pure growth resulted against very in products comparison, year-over-year. you our TiOX As for that even coatings year's tough EBITDA translated increase compared XXX This XX% basis from end into margin approximately $XXX to markets. first laminate and the million expansion. to Adjusted last plastics, an million, improved $XXX of points quarter.

average global were by higher prices material offset anticipated, costs. As partially increased raw

incurred in We the also distribution costs quarter. higher

modestly XXXX. stabilization remainder consistent our to Looking of with and year the be higher volume we growth in global the expect strategy, to than value GDP

throughout Our customers price implement remainder team we with to of the Based expect increases. communicated margin on work continues to XXXX. this, to previously further expansion realize

to XX outlook. Slide to our Turning review

we performance confidence XXXX look our great disclosed As in and our strong reflect we on first outlook. previously quarter year-end, forward through have

businesses. expect to continued adjusted top the EBITDA our communicated We of deliver at end of momentum positive of previously the our range supported all by

We our range have from we also to above anticipated the adjusted EPS into completed. already original account the share taking repurchases be impact

successfully they sides product customers move warming the fluorochemicals low both Our its towards on to as of refrigerants. business continues potential supporting portfolio, technology transition global optimize

are Titanium quarters. of coming to increases expected price fluoropolymers our carry for And along improvement prices TiOX beyond. the with implementation demand and to is Ti-Pure steady sequentially higher communicated within in the Solid through average remainder products expected in price Technologies, for previously year this of the result

results healthy the our XXXX quarter and expect first flow to of within only delay impact million with to our $XXX products, and be Mexico. our range of $XXX in we the to are but to strength return construction of expectations manufacturing projects now committed balance environmental have Not million the expect to reducing for continuously operations. to high we even $XXX for other CapEx do Owing We of fund, XXXX, a cash million. be for of year, we the continue excess of the also improving to free in the

XXXX, on the we Let goals in -term next Based results for longer slide. the full targets have described. the anticipated us confidence three-year on we at our another look take previously full-year our

to expanding healthy, not to The generating the We is billion flow global results. is facility a to with is basis. operating rate XXXX XX%. anticipate annual on impact $X expected expected EPS across to margins solutions $X continue expected cumulative Adjusted revenue to the construction a even translating new grow billion to mining to company least grow at cash Free XX% above at growth remain on GDP to profits rates approximately delay compounded of bottom-line. higher

to exceed three-year for this expect overall the of targets company delay. our We spite in

by the our the momentum next now for three throughout expect your questions. energized years. we’ll leverage first performance are this call With that, We quarter and to open

Operator

[Operator Instructions] Our first question comes line John from Markets. of Capital BMO the McNulty from

line Your is open.

John McNulty

Thanks Hi. question. my for taking

questions. I So, guess a of couple

to to are First contracts you give you you terms one customers I in lock you would up longer-term us where earlier, guess of talked as be push? on about more trying in little with working them an facilitated can update – bit a effectively. that your

Mark Vergnano

Thanks coverage I I it’s where extremely are John. see well as have us we say our John. out customers. many been with that with we well. very of Sure, would are our with work opening value for along and your to with stabilization happy them going

want as I all we we’ve for We think it portion a volume proposition us, they right have as on. on of to always be our think as our and value it’s I and that exactly want in the a of stabilization recognize want be think to we that significant we’re to don't in value said, contracts. I path and path, well them,

John McNulty

the for think and about suppliers? that potential need with for are contracts duration you out your how are about follow-up your think customers, but I for ores side, on there I And look that your well, know is know to or platform, the discussion insulated with the balance starting you and to does longer to move as that. then longer-term just maybe how that guess some prices advantaged how about raw tight guess Great. when ore I ore you relationships relatively I with a you’re and the them materials from when the

Mark Vergnano

Yes.

and and point and so have in we quarter the we year, the the on contemplated about how how what have we year as are all that first contracts on your that look of of They the contemplated have laddered this John, ore to we with ore terms sort stabilization contract. is value contracts customers we of for our in the it be, we of So, multi-year thought through plan work our is as as we range would thought but year, we’ve buys. all of

So, these through from our are all intertwined thought well and extremely standpoint.

John McNulty

color. very much Great. the for Thanks

Operator

Fischer comes question the Duffy next of Our line from Barclays. from

Your line is open.

Mike Lee

guys, first year? not without your Mark, I for flow there range high Duffy quarter annualize Lee the in price is strongest typically this just seasonally this XQ, seasonal of your why the already quarter Because earnings, through. head-on the even case reason Mike get your this is end this is or any Hi morning. not is for if quarter's business, I further up plusing EBITDA TiOX your above strength that XQ

year? this just So, of is how conservative guide a get trying for to the sense

Mark Vergnano

So, year seasonality this for the the side the say I would if point quarter TiOX second coating it’s the all a you less our of North both said, – to of the about are – have that toward little bit I that season, read used first we you business seasonality mobile and in your the this the Mike, of don't as top fairly a seasonality. have the But with think don't of say is end the confident than America bit as side, in on I the fluorochemical of is the would a but see and side heavily that of bit but seasonality of we additional good to as progresses of spike businesses be think have past, Opteon as we changing bit the you and we much year. I your feel on so used that lighter in a little guidance fairly year still the will feel will we say given, revisit have. to that I massive little well, are they range, should we very the because that see in on the a beginning

Mike Lee

in you previously own and like under buyback, And range mean finish buying you XX, stayed Great. your said the that on like your we and current to authorization actually I they’ve go the to in to Mark that you your to talk pace looks it soon then conversations your so, another how authorization hoping should expect could was here board if in about those XXXX. shares happen? willingness for I

Mark Vergnano

very we’ve we what cash. I transparent do want been So, about to with think

growth capital the on our to acquisitions, to top know return is You use company. targeted acquisitions, into then of company, targeted and our I how grow of think that add do category looking our acquisition cash things ICOR we the our fits shareholders, list, the kind to the of to we're that capital

is the you’re like right, and and this talk stock. I So, and felt a that the was that time opportunity we to point I our believe Mark at this all a undervalued thought in we great buy great time fact about company return that

We will about anticipate that a shareholders. makes engage decision, to it we and them to it’s continue mid-year. will our we buyback them to share do us that board with for And as long but mid-year board Obviously, talking sense and going opportunities. our additional as we feel back

Mike Lee

Thank you. Great.

Operator

Our Vincent next line Andrews the from from Stanley. Morgan question comes of

open. is line Your

Vincent Andrews

you, and everyone. good Thank morning

$XX strong looks like you margin foreign currency Just a very X, it at If have benefit, million look perspective. a so pass question you I on from a had exchange. Slide a through

you versus sort for assumptions the changed just of how beginning benefits if can So, has transactional year, the at you your for remind all? where benefit then and and FX are from us what that year of FX have this

Mark Newman

segments manifests of I benefit Mark most we it in Hi, dollar as Vincent and three currency so pair although currency TiOX more probably Euro, it in all a benefit in currency segments. our comes Newman. U.S. the business other saw our from our itself is then would say,

think contemplated on currency in dollar lot sitting recently the but of U.S. in not may that And of view the think I clearly, that something our factored benefit has quarter currency year, in so, a of so, of It been I guidance. some tightening, year. and be our with here our thinking the talk strengthening ratable a throughout today, the it’s into necessarily for we is we’ve it’s the rest Fed this see quarter

Vincent Andrews

as Slide And the to Okay. three-year XX, are you or that headline a now meet just the target. follow-up says on expected exceed

So, line or the you drill sort that you I'm do there segments of the thinking mean it, as should wondering items just about you in down mean upside? to, of see kind you is or how we where do all

Mark Vergnano

Vincent, more on of have very we you’ve we didn’t to and with but may mean some it. with or up meet standpoint. look in cute be going that strength be meet picked the and we is exceed three-year to elements There exceed, obviously especially as feel there the in that confident over those on we period XXXX, a are the you

So, metrics in the think think we rest We’ll things, With of confident those we obviously in the sit likely very EPS least return year see reading update on probably for this shareholders start [indiscernible]. buckets. towards we and of year this side cash the well. those this everybody, the good of to year a end what but exceed at most to we're some it of you’re the for

Vincent Andrews

Okay. Thank you very much.

Operator

from comes line Citi Juvekar question from of next Our the Group. P.J.

line open. Your is

P.J. Juvekar

good Yes. morning. Hi,

Mark Vergnano

P.J. Hi,

P.J. Juvekar

of what prices auto while opposite OEM you’ve a is I to customers think. mean So, refrigerant your that Opteon, been base for on going keep while, you would adjusting up, Opteon and

forward? bit the go and how about that product a that old dynamic would product going see talk You you up think so prices and can little new prices decline, you

Mark Vergnano

Yes.

think So, P.J. of to this you got

itself job contracts that and is, our Opteon offset mobile with very three as which price air year for that. the come you OEM, one buckets. try to think automotive productivity to multi-year our on everybody, with and open lower Number have to in productivity have to it each OEMs. we’ve OEM, manifests in with that deliver put I with as is you been to our to an – conditioning OEM, opportunities you side up Right, in

goes So one area that’s price that fundamentally down.

remember doesn't go regulations quota the that’s down specifically we’ve that in down are strong third your price if F-gas been a would for to products subsequent right is, but of is and up equal Second system old us. go the refrigerants base come stationary and and uptick leg for actually because then volume refrigerants drives you new the of side or of going because price price that had products down refrigerants demand Europe, terms And your to is nice think pop-up. in that on you absolutely in base where

price at have in play. a where stronger you position the So, least areas the quota

So, together, it put why our when price is composite you on that’s the three those fluorochemicals is. what business

P.J. Juvekar

take? and do as optionality you actions go out how Thank you question about are feedstocks an so to can think in that. chloride you then you ores a use TiOX have and your grade kind TiOX, I of so that to mentioned on you, prices, system would adjust have up, low you given second what for excuse your can that And that flexibility going your you that you unique or is

Mark Vergnano

Yes.

something they have every Brian terms team look think them. at of So, work on front I they of would that’s month, – right, that and in options the Snell the in

You’re right. exactly

to We differently. ore the ability ores, have blends those operate

can’t understand that you dime on to turn that, have have you out. on you to plan a Now necessarily

customers. the stage in the for on So, all that of stabilization your front of our is you think logic right the but timeframe, ores and about facilities the working with us that’s in value we time part

terms get that. can be they’re in knowing signal paying year TiOX. from can reply for or We plan them, to of subsequent going dependable to So, years what they their out dependable a of demand a and they get

So, can efficiently, they can more business their run we and run ours more efficiently.

So, you’re right.

is the whole strategy inside have of contemplated but time, that of all the value We it flexibility stabilization.

P.J. Juvekar

Thank You.

Operator

from Jefferies. line from of Alexander Laurence question the next Our comes

Your line is open.

Laurence Alexander

of Good morning. I couple guess questions. a

with for hit environment can market, maybe in quantify line where just terms peak sort different? EBITDA what just mean order you inventory you also, And environment cycle and for I can breadth levels, around current in seeing how we compare think contrast of your the last First, you’re and terms of are you the could the materials, the in outages trends, it’s the of feel should before give you you the if right raw order how can TiOX strength a year-over-year? world, of the

Mark Vergnano

Yes.

the So, hit let one, you me Laurence. first first for

us, have any obviously outage normal that This of able like longer excellent I’d these take happen on and We have is probably because for. well just for to we the of of planned some is, time. than outages, be these work for get a on say months working year team been to and these. company, there a maintenance honest have take benefit So, when that. little we cost spread because has our for for take there outages work your ready to to facilities also bit the fluoropolymer where we outages Teams be done us XX year we on benefit this all that really and on in the is been normal capacity

extremely we’ll it. be we’re but customers’ we these forward the same to upfront time going handle as inventory think able contemplated I with execute all build at to the well, So, These our are needs.

that we is less all but bit execute obviously of for, do those that, quantify not that to confident well. it I is is our have of will very quantify the and you that guidance. all I a year feel more than team but Lawrence, probably around part little that, where we don’t off planned a this So, We going tell

spike demand and or signals We industry. from talked the holding don't inventory we standpoint, least customers, hording. in think different we monitor see – across steady good you second around see very when we’re across TiOX, our demand seeing, before. question very frame I know time this the see a from from standpoint, from don’t from any about Your or is our you inventories we the clear at

I past. Very different than said we’ve what seen is don’t this industry we years. and utilization situation the what all say is So, disruptive an high rate we’ve in is, would the extremely and see very several along manageable next over think a being that again I at the

Laurence Alexander

Thank you.

Operator

state from of the question line your company comes Our next Zekauskas. name. Please Jeff

line Your is open.

Jeff Zekauskas

year, what’s you, titanium demand from don't for titanium your supply export from JPMorgan. Chinese think the I it do and numbers. disrupts expectation of levels that know, was March wondering I dioxide represented departure thought the that what seemed the remainder you And previous of of China Hi, balances? and do you to that monthly exports Mark, dioxide

Mark Vergnano

Yes.

and out of I So, different Middle of were the you and that primarily actually also at would don’t they exports into think fulfilling Europe of market, bit are still and intercept They The demand. a Jeff. the lower Pacific world, are of the little I Asia China going parts us. are say, East. they first and going end right higher all

the think continue be happened already is this fulfilling is So, supply versus offsetting here world you is, around seeing what’s I there. demand actually and are demand supply pulled to that

the and that’s So, period. coming the from higher was you a point out data, price very different last dynamic if at that look

are anyone and supply having So, not to we quality curve. planning that else's price really a is higher planning, lower in, fulfilling of so at the demand coming demand end the

where for seek to us. this time, be able just disruptive think being I sure not point and to disruptive being I very for nor that to as I and see So, do go, for will it’s if see global do you at that in it needs normal supply natural

Jeff Zekauskas

my think is done to there the you for inflationary XXXX first what about discussion have of expect cost slides reduction costs, cost the do any accomplish for what of I or reduction, XX quarter? follow-up, no was question talked or for but I of did year-over-year Then in million you effects your your and In cost Newman. accomplish Mark reduction you

Mark Newman

on said we took. have would think which business first say higher in that we pricing actions I TiOX the we, we reflected cost, ore Yes, contemplated all, our I are had of before

showing think structure. fixed keep our lid just on cost I tight up We they So, that line. a in are very

while XX%. it our Jeff, is If COGS were revenues or know XX% up to close probably up is, you

Our SG&A as down is SG&A of nominally sale year-over-year our and percentage single digit. actually a is a

which lot out really done a cost, areas of have to it but the business we was in focused. versus the continue that, on So, sense where the initial focus fixed to be of the primarily growing plan, cost business the to investing the makes transformational and we so do continue focused do our and on dial to work the cost of in earnings really,

Mark Vergnano

reiterate. I add Mark's to to Jeff just And want to point, just

take the the off and will not side equation. of cost We have our eye not

do better. We’re always how to inside looking for things to drive the company, how efficiency

goods So, that or raw a of from sold lot manufacturing cost saw standpoint. or you distribution a of material the cost was really

eye side. We cost fixed continue very, the very to keep our on closely

Jeff Zekauskas

Thanks very much.

Operator

of Our the Sachs. Goldman line next Koort question comes from Bob from

Your line is open.

Chris Evans

Hi, good morning for everyone. This Evans on Bob. is Chris

story I the First, we helping fun and appreciate just us as it up It time wanted to on you congratulate in. ramped really Alisha. the all was

and So, congrats. thanks

see fluoro special in legacy the Next, to a was your then wanted on looks quarter of had considerations you being of step there wasn't the in rest uptick up Mark being of than of that for any outplayed how or just time. sort terms margins, might was how any quarter, just a longer that and might your I just the over refrigerants margin for that one-time make sort comments on question that higher the year, of sure period wanted the have

maybe in already previously I profitability your You ultimate be so segment? wanted the you overall high on and XXs targeted what longer could just the think time, of are some you commentary for there, period

Mark Vergnano

made Alisha you Yes, blush.

doing So, Chris. thanks for that

there think I nothing strange in quarter. the is

there the quarter. in wasn't opportunity any one-time So,

you’re getting Europe I we’ve an this then last and XXs have volume else. a We expect fluoropolymers the we’re team it’s in year. is the there than said anything more of I living always where was Opteon, side. now bit but pulled refrigerants just that’s Paul have Kirsch of fluoropolymer little you a we’ve fluorochemical I our should the side, rock knew bit of solid stationary margins, mid-to-high quicker, job think exceptional We and fluoro and the harder right is done little accelerating right. what got side price the what And had and F-gas increases with think regulations on benefit the think

very this on year, application is development a fluoropolymers starting have the to the We engine work but increase targeted side. really price on going

these bit margins. would little a say very I sustainable are maybe earlier, So, but

Chris Evans

some this mean some I year? additional but the seeing an do January HSC strong incremental were of or already F-gas going pricing year, could but X, in into amendments good Kigali positive benefit the Kigali you regulations And helpful and Great. pricing goes positive believe the imagine so into really be business, you’re legacy XXXX, I next force,

Mark Vergnano

– sure are for this is very Europe. us business. going absolutely that Yes, benefit Kigali been you get for his we’ve you important these Paul focused and right. because are team the very and that on seeing for impact businesses forward global for in That’s huge now a

Chris Evans

you. Thank

Operator

Our from Carson of Don next comes the Susquehanna. line question from

open. is line Your

Emily Wagner

Wagner fluoro during on prices you Good with a term do Don. the cycle? morning. absolute above In the downside TiOX contracts, percentage what raising not This longer there Emily or for price spot price is in get an contract line for protection Is certain down the the spot?

Mark Vergnano

specifics is Emily. really Thanks understanding of are that ore with where least We I don't be. those those will talk proprietary we we can you contracts. assure think the how of cost Emily, the at cost side but price in each our or about evaluate ore contemplated of contracts our customers,

talk about we don’t both we and our that? protect ourselves really specifics through but that, So, customers

Emily Wagner

what debottlenecks XXXX through see capacity of you terms Investor in referenced in and then your And increases at XXXX? you production do Day,

Mark Vergnano

getting that really on to those really now do XXXX We said from that. track. through are the we motivated drive XX% and teams We're about trying and are excited standpoint what is to

those Some we’re equipment, all some are those. those of changes, process and are executing of of

Emily Wagner

Thank Okay. you.

Operator

line [Operator Bank from Instructions] Spitz of Our America. next question comes from of Roger the

open. is line Your

Roger Spitz

EBITDA you QX XXXX? Thank QX XXXX tell if the you any plan fluoropolymer and impact us of Can turnarounds in good the morning. in what expected

Mark Vergnano

Those all our of contemplated are guidance. Yes. inside

that always them. known we and these planned So, standpoint have we’ve of from always around

they our absolutely are going of part forward. So, guidance

Roger Spitz

trying the can size just so the how couple Sure. I be shape next see over EBITDA what was might know I to to the of quarters?

Mark Vergnano

think a ignore for is are way is, I way this the plan a the you it. to little say flow way do shutdowns of these the over know shutdown that would So, because to period ratable when sound nature, actually the and going year, goofy a with this you this time. Because large of costs our about I best we remember are

costs revenue we all still and that we an into the have inventory don't have the because those flow going forward. one So, period, we have product

ignore because that cost modelling, would think say it’s and about going So, from play. already standpoint of a revenue I how you our to in contemplated as terms are

Roger Spitz

Okay. asking year of maybe where talking so. question about And the cycle are different, little over bit or your next my of TiOX just it we a from other the view shape is, the

Mark Vergnano

off standpoint. it everyone steady Yes, is Not there that flat I and but say it am be is at into we that team based you, bought cycle we concept That whole part the fairly stabilization absolutely the I theory, we’re going into executing the bought I the value a of believe tell having would to could don’t how know. that is interactions our customers of is is believe we and it, same with on from and time.

over next that believe something years. form this to see cycle going that really is couple of I a of So, you’re the not any

Roger Spitz

much. very you Thank

Mark Vergnano

Sure.

Operator

last of line comes the Roberts Our UBS. from from John question

Your line is open.

John Roberts

quarter guys. Nice Thanks.

Mark Vergnano

Thanks John.

John Roberts

striking you and gain do more but the Back or Europe think are lose Chinese that for strategic business money the to and to exports, think is there sales? outage, do Chinese a profitable foothold willing a they the on [ph] probably those the increase that’s on to Pori making is related to you investment

Mark Vergnano

of all, Well John. pretty there, high first prices are

is that think So, strategic from doing I purpose. don't a anyone

[ph]. there think I for a is product need Pori because of

absolutely you right need price filling need and prize There that good it well served you’re at now think go as is I perspective. guys a and from will pretty why you think and think look that in I ask at getting least serves this but filling that you market at a that’s the are going there, I see isn’t in point. that I right our a would it is volume there, a seeing as

from that not about So, that’s we're concerned standpoint it. why

John Roberts

you. Thank great. Okay,

Operator

of the Juvekar question P.J. line last from Citi Group. comes Our from

Your line open. is

P.J. Juvekar

the in the and the capacity industry, [ph] little some outage can how you over earned XXXX Pori and Chinese with industry pollution up do down control TiOX you. related think capacity much shutting Thank with you. Chinese to a Mark, of restart bit Thank that, do think equipment? back you new in investments

Mark Vergnano

And Did standpoint. don't of of from lot have from a of market I, standpoint. earnings call everything view, if for I shut over restart it would a would we but think of we’re did that I over don't an supply have little into from that an all our I earned it whole on the it know a, was sure. not down. P.J., effect seeing it say bit that I

there spent went I that We be think over of lot might I a Newman a spent of capacity sure this China some time, ago. to a the China I our time month in half about Mark folks coming and in, and to time, are a but talk of and you new lot regulation that inside in time of absolutely real. market, with customers convinced is the environmental say thing would same and I'm many we enforcement and there the lot a

only it but real, not think I it sustainable. it is is

standpoint, being which I operate. I think the their is things think or increase made significant how has and they their governments these and facilities, major I back country a the the it unless see coming cost don't will of a from investment from about standpoint in changes it, something KPI very provincial inside government lot serious the for become is that of so a

think going don't coming out see to play of couple years back. is So, again, still all and next supply I this the that over I

P.J. Juvekar

Okay. Thank you.

Mark Vergnano

Sure.

Operator

to Mark Thank remarks. over Vergnano back you. no There questions will time. are for further I it at this turn closing

Mark Vergnano

So, and for thanks joining again us. everyone thanks

to as the really of growth. exceeding three-year are continuing exemplified really are outlook, Our really efforts said we be our want our and first to to way to targets. dividends us I and achieving all again say results employees commitment earning of XXXX cornerstone XXXX the our quarter paying before, I made the our

your all you Chemours. thank continued the on again, interest call thanks So, for and joining in for

Operator

conference today's concludes call. This

may disconnect. now You

The Chemours Company (CC) 4 May 182018 Q1 Earnings call transcript