CC - Earnings call transcript Q3 2019

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Operator

Ladies and gentlemen, thank you for standing by. And welcome to the Chemours Company Third Quarter Earnings Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions].

to Lock, conference Development Vice Relations. like speaker to and now Jonathan today, President would turn over the your Investor I of Corporate you. Thank Please go ahead, sir.

Jonathan Lock

quarter to Happy Chemours everybody. morning. conference Welcome Good Company's Tuesday, third XXXX earnings call. The

President President Mark Newman, President Officer. and Operating Chief I'm Chief Executive Sameer and Vice Chief Vergnano, Financial today Officer; and joined Ralhan, and Officer; by Mark Senior Senior Vice

remind supplemental you as Before provided that those made and Chemours we like with SEC. documents start, and call the I uncertainties, has the on contain that the presentation well our to as website forward-looking information would in this including our involve in filed comments on described statements risks

on not a and that future duty certain future new events These undertakes realized. and forward-looking be of statements assumptions as result future statements forward-looking not based guarantees expectations may are results update any no of information. Chemours of may Actual to differ, or are performance developments and

During presentation. performance. the Company's financial in and useful end the management evaluating are to course and non-GAAP to investors adjustments this believe at refer call, that terms release we measures of included of reconciliation are of this A our certain non-GAAP the will

I Vergnano quarter. the our highlights turn Mark? call from CEO, will now who over to the the Mark will review

Mark Vergnano

ago, at strategy capital site. of as a Johnsonville DuPont weeks X, technology started to on including Jonathan. ago Ed reporting our all years Thanks, few increasing DuPont joining of for He Sparks saw and New release Good our morning, appointed everyone, as corporate President you sales, chart Chemours from held segment Newman. well our you career operations, today. has Starting with has positions and as us and planning. XX Fluoroproduct Mark his thank global in been press Ed responsibility at

he Solutions, responsibility in business served expanded Most newly role. Chemical recently of President will this Ed and retain as that for

to believe And to next have see experience step Ed forward leader to right for segment. Again, my Fluoroproducts of commercial the the the such up and together has and a opportunity lucky our ready I business to business. We Ed level to I talented lead the tremendous sincerest very look are mix We across operating congratulations. change. years. to over the take Mark performance Ed, coming to drive our working need improvement

continued to our next on the our chart. from reflect results in many markets. of quarter quarter highlights the and and the Moving sluggishness third core Results a weaker quarter across macro

week affecting region. been has China entire Asia notably competence clearly with ongoing the across the dispute U.S.,

global the in the on lines. control. fluoropolymer business proven have we In our team Opteon applications our has grade, the in mobile face for delivered our focusing growth challenging, conditions, high and While these environment been execution elements of managing the market within and of

And flex Titanium regain our increase to continue will continue and to to leverage channel Technologies, share volume forward. we channel us this through help moving

the lucrative launch announced also We market. enter specialty a under milestone the key TiOX we TiOX as grade select inks Ti-Pure brand, for the new a of

our portfolio our and complete of Methylamines simplify enable shutdown best opportunities. Methylamides finding creation term shutdown We of to long the announced non-core to in we December. end value growth, be portion of business, to Solutions the this asset we're on addition In focus a sources our September, working anticipate by segment. of the new the To Chemical to

entirety But the next September. annual on in the report haven't chart. the responsibility corporate going published through in here you a in take website. more if I'm detail commitment we already, our report at you on we're second please, have doing Finally, work to its our look

a by published responsibility which we achieve cover of XXXX. ambitious XX we embodied X, and a to our us portfolio. our commitment a people, our we chart from This aim apart set statement report sets and the our planet, future our last turning believe unique chemical it to to was first corporate So proof These goals, sector, peers. in in sustainable commitment goals year,

CRC that with metrics second we report to transparent This track progress September, we made. our published annual

We sites, our through and significant the our within made at products have sell progress workforce. we own

example we example, a tons per by and combined bottom make greenhouse new line cycle we our investments footprint that at planet. cost, For heat the year. of installed solution COX New lower our gas lower which will can emissions and a equivalent a power Johnsonville site, is It's benefit recently that XXX,XXX system reduce great how of the

cars warming technology estimate Opteon, basis tons is low million the million that XXXX. great the of XXX eliminate by on From our reason COX technology next offsetting worldwide. power hard equivalent global emissions This refrigerant chemistry. the equivalent And of are we That's this working a will years. the sustainable COX product the over so accelerate to XX.X global of we why six adoption to that's perspective, a of

balanced building team by of positions U.S. XX% more continue we ethnically towards by XX% employees. global work filled diverse with and to filled Finally, of all women a positions

our view address benefit our in business problems As bring diverse tremendously and in we last call, broadly. the we world to I will in the from said, points more of

To we have be answers don't yet. all the clear,

allow the checked businesses Our achieve. CRC that goals to exercises will are us box not usual

our of helps the that reality. change kind is our XXXX objectives necessary know It new to energy us dedication a chemistry make collective and work company. this create it a I to tireless our However, can make that

our results into thoughts over quarter. I'll financial priorities to provide back that, the to the year. be the our Sameer I'll With go over things at next some of turn heading to end for and call

Sameer Ralhan

Mark. Thanks

share in of the line of was net second million. quarter. adjusted X. decline year. per in XXXX. $X.XX and and past drove lower and sales net income was the third the $X.XX the billion chart of were in earnings to $XX $X.X GAAP million Sales midpoint move Lower quarter share demand number $XXX of income continued quarter Ti-Pure adjusted relative of global $XX GAAP of with EPS below as pigment million flat soft Let's per EPS the volumes to the

were quarter. million savings tied of million $XXX recognized of $XX Adjusted to primarily by asset the Methylamines initiatives. of EBITDA cost charges was the the related across Methylamides main two charges lower We restructuring segments. and shutdown and impacted in and business These margins our third

to continue by be segment will he more margins under margin here plants, and and discusses affected margins Technologies low sales. refrigerants declined imports detail quota sales illegal base volumes circuit. Titanium Mark products provide F-Gas when results. impacted the Opteon Total fixed across of Fluoroproducts high costs as absorption

flow million. quarter was That QX. turned cash operations spend On $XXX by of is the second cash $XXX the free that positive flow June. that million Free We for indicated driven third million. cash of call, had quarter carry flow in CapEx $XXX momentum I from and into

third absorption. is negatively to an the segment. a quarter. adjustments year-over-year due Titanium adjusted in combination mix headwind through quarter of total and in $XXX pass was Lower $XX product This million headwind F-Gas year-over-year affected in lower quota and million, Turning same fixed on Technologies quarter Titanium $XX of global dollar our down the million certain lower a refrigerant prices, volume ago. channel sales lines, another primarily from EBITDA $XXX a on was basis. $XXX prices results the Also, our Technologies and million period costs pricing segment, additional in a was basis. in under lower page, some volumes, accounted in principally Lower for a through year In the headwind million

about the Operational when you Newman headwinds of he give benefits up production Corpus the will the Christi this were in Mark quarter details more at by from ramp the offset a results. covers segment Opteon site.

to the X. ahead Moving liquidity on chart section

reflecting of the $XXX a on the million up sheet, quarter. a as ended in second million flow the at in period volumes increased lower from the believe sequential move Technologies we We of continue operations quarter even a the earnings. end from to million basis. $XXX from Titanium Cash strength $XXX balance was nearly of We cash, with of through quarter,

CapEx million $XX in shareholders million quarter. dividend was and a return via of use to the $XXX cash we

the X.X net a results month times the end leverage at of XX on $X.X net that trailing stood approximately of third Our quarter in approximately billion and debt at basis.

performance. turn things now our Chief discuss to over Newman, Operating segment to I'll Officer Mark

Mark Newman

Thanks, Sameer.

weigh ahead actions a and Fluoroproducts. from in continue next Moving perspective. illegal results awareness the from to trade public to accelerating corrective chart, our imports environmental, regulatory, We're headwinds on

been reached a a yet high have profile point we there tipping number have of of While seizures illegal not we XXXX, activity illegal believe in under where control. refrigerants fully is

countermeasures optimistic that ahead regulatory we said, the being law scheme remain and quota and and of level. F-Gas value partners uptick an the rule That will a of to remain committed of step fundamental result State XXXX We with in enforcement our industry the as EU down. working on at

third quarter XXXX. the million, in sales down $XXX from million the $XXX quarter, Fluoroproducts total net in third of

in We U.S. demand with particularly and partners, and outlook where the the remains wake our continue the visits trade channel China of my automotive Asia, weakness, declined demand observe to electronics issues. customers sales uncertain. in In have

Adjusted high F-Gas EBITDA automotive These partially sales activities. into U.S. for XXXX. refrigerants the as quarter of in third Asia, lower $XXX demand stationery quarter lower and to and headwinds fluoropolymer platforms in in compared at application blends, margin offset of Opteon the new Opteon quota million, reflecting adoption well came were by as the development continued

and by fourth resolved. not headwinds our the offset this we approximately issues our year, and to operating These Corpus circuit, impact have saw margins our reduce we in the improve adjusted the was expect Opteon now Christi operational benefit I and a at site. X% execution. which quarter. ramp of production happy EBITDA taking with similar been On the Ed this positive in in actions are performance side, are we operational But Fluoroproducts quarter, by elsewhere

at like in facility, that on works call our TO new capital our investment Moving Thermal it. our Oxidizer share we're making to details XX, chart or I'd investment Fayetteville more as specifically the we to

efficiency. reality. TO TO work is by Fayetteville. system. chlorinated the does of picture While who it organic across chart and our and the the at this on greater Chemours to Wilmington is in come organic to a together teams designed XX% chemicals emissions with eliminate I'm making technology the than very control sure the to people of product The proud investment control The I'm not chlorinated state-of-the-art is impressive, scale engineering chemical site. we're in to It the emissions of a significant make justice have

million drive been fulfill goals. October to excited a chemistry believe manager, past meet plant example and TO our along $XXX company of new the team, complete to the Fayetteville its project the our of work commitment as online, kind XX. our this first tangible and a kind Long, announce several months CRC have our enterprise at of bringing with was XXXX I capital mechanical hard Brian that technology is of investment to our in being over I'm

segment. Solutions contractor quarter chemicals despite were and and the contractual in Chemical volumes our onto of headwind stable, performance pricing a XX, Mexico, solutions within was product which blockade demand Sales the a chart shipments reflecting to intermediates. the lower Moving a in in mine Mining customer in at negatively our $XXX few million, quarter. third affected lines

and quarter or margins $XX marks segment the across consecutive the discipline of This record. EBITDA Was million in and segment. the EBITDA of product XX%, operating also adjusted in on highest expanding segment, Adjusted of quarter better market any the margins this third

to a portfolio. business inside As to profitability return did we This our and announced the and term meet drive objectives Chemours not of the resources Methylamides was Virginia. plan that start call, our Belle, we in of at West elsewhere reallocate at portfolio, our growth the the and Mark mentioned, long Methylamines help shutdown business

I'll to the pushing across improvements strong continued Solutions Titanium in business rest of chart. mining our from Chemical Technologies close incremental portfolio. starting performance cover and year the We're on solutions next the behind segment productivity the our

at the on and sales channel sales. basis, basis. came XX% Third quarter increasing impact down new declined sequential Price $XXX about and reflecting but by mix million. flex product of up in on a Volumes both were changes, at year-over-year approximately X%, year-over-year, XX% sequential development, a

inflation material Ti-Pure within of cost was lower pigment circuit, driving to result in expectations. the $XXX to million the quarter, Similar higher of adjusted last unit continued or volumes, be across raw EBITDA

Turning to the outlook.

be believe levels be at we or normal below with balanced downstream overall While visibility to environment bounce. appears for limited the demand quarter a inventory to levels, fourth

in return pigment reflect we levels, the to our value levels and growth products, market the early over for confident believe in are destocking of at several is outlook ending year, TiOX quarters. we committed With holding the outlook like progressively next GDP the our term and to which prices and TVS fully to strategy. use Our long remain for

Stabilization to three strides the had new we’re On and Ti-Pure forward. first a get global on made our next We be or perspective, full of stand piece with digital the we all Value quarter behind we some critical flex quarter the scale will Chemours TVS. From chart, elements, to commercial believe indicating of going big which during portal. a a flex a began

perspective, manufacturing and integration from the supply a been have on August. and acquired our with we’re and Second, making progress Minerals, impressed chain of the we Ionics capabilities great in team Southern

low our Finally, market, our new the announce offerings, to brand. for the abrasion new the I’m inks new under launch proud Ti-Pure of product select

applications a have of months, for We to that growing products hit inks. at pipeline the like applications XX over specialty the new market specialty next targeted

customers pipeline future to I and love know going We telling more are look about the products our you to these forward on calls.

shareholder the significant long all value. of in these the you behind see, And will over believe TVS. investments elements critical are As create that term, we three can investing

like to With to back Mark. things I’d that, turn

Mark Vergnano

Mark. Thanks,

to as move toward of the wanted early end chart. We to next on we Turning year. provide some the the XXXX thoughts

formal We the providing of as now planning key that will year, process XXXX but are guidance is new be fully underway. in have our early some the for themes these emerged

First, line achieving growth market. an uncertain top in

with can that help services our focused ensuring and products, the engaging in be product in high global the be creating new our end We uncertainty. This we face of maintain even successful. them lines and to offerings on customers more will momentum means

applications. are Ti-Pure of technology OEMs discussed our for is hardware new grades of customers. means inks the our specific Opteon select that of for we helping bring Fluoroproducts, In launch a the next will and what broader equipment range HFO stationary that to generation and create Mark

evolve the and world. to expand Ti-Pure markets to enabled improve, continues technology footprint our pigment geographies to our will and As new we look and chloride end around reach

and Second, discipline productivity. operational

in which Given XXXX. term as we long network ensure that will operate to manufacturing operating lean to issues Sparks a and sacrificing this the we hit we our weak background, as don’t in given are global ensure we repeat Fluoroproducts focus renewed economic efforts network Ed engineering a are our Furthermore, redoubling in of possible the his environment, to I maintenance ensure goal. know without we working bring on deliver growth. to hard our have

free cash prioritize will we generation. Third, flow

flow cash operating business, we’ll are We a convert to as into rapidly determined looking to free maximize conversion be earnings more and cash.

cash flow return shareholders in the majority our of As XXXX, overtime. we will promised we to free

will the is commitments our continue a CRC Finally, this company to from back we down our will execute our not against commitments and bedrock of in teams made XXXX. the we and around communities It world. we’ve to shared planet, our

shareholder will I As we’re earlier, the with initiatives long specific XXXX providing enhance term on the earnings said guidance to early in along we working value. and year, be new

the operator, that, up open ahead With line for please go questions. and

Operator

Duffy you. Fischer first Thank comes Your [Operator from Instructions] Barclays. of question

open. Your line is

Duffy Fischer

guys. morning, Good Yes.

So, but puts business First was in price? than detrimental questions margin, us bit kind versus just just takes around bucket through and it’s give more HFO base the walk whether price of not and was EBITDA, just must the How you Fluoro. little that be year-over-year and the was The sequential color on around Fluoro? because you obviously, can down Can volumes just much losing how some much more F-Gas a price? sales.

Mark Vergnano

Duffy. morning. Good Sure,

me I Let it start Mark. and to hand

also You’re right – right. we have that had issues, some we operating

that that we operational issues had hurt us. So, some

ended You up. saw margin their where

be low we’d If mid-XXs out those of to margin. kind you of back there, issues operating take into our

it. Mark give it you it. can an had on me effect So, through that he But walk and to let

Mark Newman

Thanks, Mark.

million of of Bear is in quota quarter that sales would prior is Fluoro a about I guidance $XXX the in with way line of lumpy. business somewhat mind think year. I imports the say impact about is the effect Duffy, illegal So our our

comparing was the had some our need finally, operating of mentioned, we year front in up to our if our our The But quota the with business then should facility. That headwinds to headwinds a of a you’re of have rest So, operational in go circuit. where more side that had kind as quota you Christi of sales, quarter in you to natural volumes think about is, that keep ramp we continue last as kind I at overshadowed the to had quarter. some we forward. the the of And benefit of Corpus margins in way Mark we you.

offset as you it normally So, And of see. Mark as that would year. the that gain be without that, this in without guided said, the headwinds, to kind would mid-XXs, operational we’ve

Duffy Fischer

on level? EBITDA Would be you volume on HFO, and growing. on still the growing an on then three And level, dollar it a Okay. said on sales all level it’s

Mark Newman

a still. conditioning So, aspect double air Opteon story digit year-over-year. illegal is It’s ramp know Opteon conditions, affects up import mobile at up growing. the of air you the blends targeted Obviously, growth

headwinds having. on where that’s blends. So, is we’re The felt the

double the Conditioning volume see to well. Mobile growth as continue we segment, On Air MAC, digit

Mark Vergnano

to So perspective. point, three a all from Duffy, earnings your growing, are volume revenue

about close market. think year. be always car HFO to we’re year, next end park. move point the XX% U.S. of will you quickly seeing toward is XX% of we’ve By to talked It’s where of the Remember, in to the growth XXX% And the the as about U.S. a side, obviously the If at now their on mobile is up Mark’s Japan Opteon whole moving the utilization they’ll ramp. get we probably very

for us. So, those are really what the drivers are

Duffy Fischer

Thank you, Great. guys.

Operator

question next Your of McNulty BMO from John comes Capital Markets.

open. is line Your

John McNulty

morning, thanks taking for good my question. Yeah,

didn’t some be to can the to verse to to you have a – we you who would seem you. recovery back I the quickly about how that regard expected far help as passed guess So, us this quite your guess drive give can running you’re we as to may of recovery volumes, – your thinking of I ahead with TiOX have come be been they update least given an so going How ability forward? as phase. and seem bit at of TiOX drive year volume market peers destocking

Mark Vergnano

about well don’t but installed customers, expected as our supply the goal to of lose I TVS during think earlier we time, you of we in to you security we Well, it, that as about that, John, if have would the giving that when period we would whole predictability. think share that have price program was as have. year, started we really told

as from our that share market. was quarter. as area look the – you around we the last we’ve gained upon see, turned quarter, that’s we move at you our back, plastics up, really can quarter, As quarter lost believe And this some the primarily volume share

Our need share contracts able gain to they side, really move we’re six customers. plastic where price we as is we months because, work And now with have that’s where that to, advance we could to issues extremely and and the portal in back up the that, we’re coding that well put our we Ti-Pure flex based and orders accomplish. up group, running on operating now our could in and with had through side trying to what the some

we we’re in that I a And as feel from way all the gaining kit we’re would like that we’re say forward we the in moving doing that now. in tools it So, tool standpoint. have to we want our the share back and thoughtful

John McNulty

flow that on XXXX to how incremental XXXX, squeeze out XXXX the what your at it. thinking the are look year for we your can do look measures you And that guess. should relative What Got as cash? flows? you we cash be then Like generation, take spoke and to to can about I cash to in comments you focusing

Mark Vergnano

EBITDA happy is, not Yeah, we performance. number one been well, our with have

we but of around little the of a recession in got a have do both do uncertain that believe we of, That’s said growth cost obviously, what EBITDA want marketplace. to uncertainty. that drive, the on not the there’s as predict a we corner. a the it’s we earlier because terms not an around can of believe. line Listen, top also We’ve lot little our But increase initiatives, performance we bit line. I bit believe So, a that we we from standpoint

a bit we’re costs on there. to some little So, us of going balance take give to actions

material raw The other is now we’ve and to got those work have inventories we right very high through.

one do in can’t that You all go.

have So, get to XXXX focused we that inventory really for those levels.

to we So, working I is want really the on. capital area other that work say

John McNulty

the for color. Thanks Great.

Mark Vergnano

Last piece this had heavy of CapEx CapEx. year. We some

more We’re forward going as be at next go we bit well. year to little judicious a as

flow So, I’d generation, when three the pieces. say those you think all it’s about free cash

John McNulty

Mark. lot a Thanks

Mark Vergnano

Yep.

Operator

question Carson Don Financial. next Susquehanna of Your from comes

Your line is open.

Don Carson

not what’s can three questions cases didn’t agreement secondly, really Thank and issues, And quarter Ohio first, you couple give putting one here? a with happening illegal you’re also uncertain that you. us separation update is range? Mark guidance, on firefighting I an issues the foam? fourth your some outlook guess on update PFOA you the a that DuPont, then

Mark Vergnano

time us Don. Sure, so haven’t talked different guidance that. you Well, when that’s about we all, first of do our changed we didn’t anything why last hear

So, the talk range that of it, we guidance to operate in we gave side lawsuit. legal before, I about not the Around everybody the much DuPont continue of before. said I’ve could as

folks We public I’m could have dismiss sure refiled that. that and DuPont’s to our read reply emotion to is

always But self-explanatory. I’ve pretty go probably in there detail because you lot Chancery more that the that briefing detail in in Court of than Delaware. said is can’t continues a there, see that. As there’s in here any I in

case. is a MDL. tried been not caseload Sargus in case has be the it you and now with cases, another going that Ohio that to that On where taken has might seen, combine had grown. November that the was Really this before. have as Judge about It’s he’s

now really first continue and that. for right the be want trial So, set January, we to for to around and aggressive we prepare is that to continue driving

the finally of foam or AFFF side then it. firefighting around And

And those made cases. PFOS used And we’ve PFOS, we develop. As standpoint. us that never as a always of never defendants use before said, well. to or are going long foams these really are DuPont manufactured It’s PFOS. or time we again, have firefighting around take most have said never to in we’ve many from cases There as manufactured always

we’re a minor something that’s and distance, So, probably player in the we that here. feel that’s

Don Carson

you. Thank

Operator

Goldman Bob comes question of next Your Koort Sachs. from

open. Your line is

Bob Koort

the of Mark, then seasonal market you evidence and quarter? the the from change third I could of we quarter? Should year have morning. or some time real TiOX, be What better fourth year-on-year you was would volume growth stable in the expect the sort quarter as that a talked then drop. Good XX% And fourth guess meaningful in typical last recapture. first about share of saw sequential you to volumes Thanks. second

Mark Vergnano

I seasonally you normally down would second think see Yeah, third Bob, versus quarter quarter.

make we’ve at market, terms to in look been toward really aggressive So, it’ll for customers to to we plastics fourth plastics continue with viable be the our the that working you been work. them say, really of as believe our offering. That’s would up standpoint. quarter, I from flat

to really drive. we’re how that’s So, trying

Bob Koort

Solutions, Thanks. the about Chemical also you pro And getting a much the then metal on margin margin levels. move basis? businesses needle out Does you forma of talked the record in

Mark Newman

fell basis, Yeah. our helps. certainly its But make And help. to It objectives. Mark help of will closer that’s Newman it It’s to Yeah, margin from Bob, breakeven. strategy business segment it here. an our been return part will a overall below us.

Mark Vergnano

Bob, always be goal. EBITDA margin we’ve would the mid-XXs. in work the could that’s company, we Chemical that one is, of the spun segment that which we believe with toward the typical we we the our could said Solutions, since beginning, do move of in since And average the things

get as execute going we range closure bring Chemical the we’re to of work to continues the teens margin off business, you quarter. goal And to on we be think low to very high up close the we into and it. saw Methylamines to in and continue Solutions this mid-XXs XX% to the of said Our

Bob Koort

Great. Thank you.

Operator

Arun from RBC comes of Viswanathan question next Your Capital.

line is open. Your

Arun Viswanathan

far looks to Hey, thanks. a or encouraged have of your that’s still would even side TiOX, comments why the volume some is watching? a outlook it on bit with the take, a as destocked. be what the give more your backdrop? if more and bit on, you’re little else on inventory Good kind hearing earlier or just little customers little like you that morning. be from industrial wouldn’t fully whether does Thanks. bit just I of as And your I in if wanted maybe guess What you’re just thoughts cautious you’re production been half so, it that first made get anything thing they us

Mark Newman

here. largely destocking would Mark Arun, It’s is say done. complete. Yeah, view its is our Newman I the really

economic We create have demand today stimulus going higher to enough forward.

quarter. view certainly So, is, see don’t we the our I think fourth anything, in

As globally, the we go – are improvements would in that look to see terms quarter a will we as fourth demand. in look out as do of through drive, progressive in bounce starting that XXXX. we believe, demand But we

year. back expect around And we we the based year current expectation as start get the that, get through especially move we as coming we stronger through the on some year of cleared move where so, to in up, think on demand these trade today. we see are that the as inventories marketplace And our we uncertainties to strength in

full say, flex. quarter This offerings capability our also quarter. or our full we our last from channel the didn’t we was offerings of perspective, where arsenal had first have of would in I product the

attractive especially to innovate lost in to continue our and more We make that segments share. where we customers channel and

that announced that we to know, portfolio spite strong bringing offerings product have we a of, to that we're you market, going is know, even demand. of our make full move you use plus, market in that view the we're into very XXXX, as So we

Mark Vergnano

the we of it. levels the very thing he I'd beginning, mentioned inventory pigment in channel only comments add think that TiOX Mark's The in low has to

positioned to be for you're to take turn not to of to that. We're marketplace well lot things able up. of whole care need the a going in pull So

customers' to We that have capacity to able be be to when occurs. meet needs ready really able our handle that and

Arun Viswanathan

reached tipping feel Thanks. just to continues worse? more there? tipping get follow-up illegal you slightly that haven't And Thanks. case mentioned take, just you Could is provide the is as reached Or it you And situation. Fluoro thoughts timing? point, point the important any time some problem it around, the because detail if it's on you this it side, maybe that to different the there, just elaborate in what's a a the controlling going on haven't you

Mark Newman

on issues. Yeah, you concerted so environmental tax, This we is efforts advocacy have trade an around and a know, wide, industry enforcement.

cars really as So, raising you This where lot X of the basis to investigative there's for a is in equivalent X work here having, we road. you to complementing with, we're We're believe public know, that know, illegal then of million you significant coming know, enforcement. buyer awareness. And the additional estimates, through. a are a greater imports on

working we're fronts our industry all with partners. on So three

We seizures and of couple Greece profile high in have year seen a Poland. this

as through our the that, something we Our happening impact, view requirements as know, this we is focus you in have quarter you in XXXX. greater today move at maximum is But, XXXX. ensure will is down know, continue you step next look impact to know, to,

in on by some is our we'll early of success, not this day. more, do happen a I we're But of continue earlier, So, and to indicators the the know, going you to mentioned single encouraged points

Mark Vergnano

point, Mark's here, we're alone not right. to And

we're impacted with of also by refrigerant So this. many working are out suppliers here who the

tons talking You the world. million But is atmosphere to this. important you're the carbon I know, this it's XX from because an issue our dioxide mean, standpoint, of a XX of about for issue important million very in us. for going

for terms mentioned. European the that but not the good in not Mark the perspective, them is good is world, also the for and this – So good environment, EU not for understands Commission as of something

got that So and that everyone, all all refrigerant the fix or understand or the individual states to something the the is manufacturers, constituents, we've it whether this together. hurts EU, it's

full so press on put continuing a we've this. court been And to

do thing that is continue We until will solved. this to

Arun Viswanathan

Thanks.

Operator

Spector of Your next question Josh UBS. comes from

is line Your open.

Josh Spector

the contracts guys. portal under was quarter sales run flex bucket be sales? percent what their hey, would you your Yeah, much could of TiOX how term wondering if in long versus I between

Mark Vergnano

Yeah, through our go go our The today. or either have – portal. XX% in over through remainder contracts we about distribution, would flex

So it'd but be two, over contracts. in those a mixture half is long about of our term

Josh Spector

mix in how portal regaining flex So I'd you more pricing around be to that around playing I context guess as out? Would you expect you you came a mix if you that to dynamic share share, some the plays can quarter? decline some curious the do in give assuming fourth part guess Or back that. I relative see price

Sameer Ralhan

plastic think shouldn't increments would that to in price But where that have will I we're dramatic. we really price. don't is that from from coming we that down, have very those consider standpoint. Yeah, customers space fairly some price we flex changes small shouldn't – primarily be of know, standpoint. specific in the But you be be how where We grades to working It's are that operate you that but expecting isolated stable. portal to the that dramatic be you might

it'll and targeted. small I think subtle end be

Mark Newman

marketplace, portal here only a unique gives advantage line, the price in and targeted know, would discovery Chemours very know, is, Maybe flex have segment. you I the thing to you the add by product by

us we very you in helping to make adaptations forward move so, of in going this forward. tool need we that really the And know, as in precise is time terms

Mark Vergnano

is them quickly of change what well as as as surety discovery But can is we're to are allows year with around You going These things mentioned ever for which know, I really we're our route Mark from customers. we've tool, market on price, I for think that's we're learning about we've change – way portal anyone has market the flex a to time, these I everyone is at really different using, price. now TVS that contracts same depending done important predictability to us what stable we're supply but says back ABA this the tool and probably about customers, getting you understand and do to a or ever before or the really contracts that, gives as done. very know this than know talked our

a and help customers So market the tools to really us lot able it our gives inside work be to here of

Josh Spector

Thanks. Okay.

Operator

Alexander question Laurence comes from of Jefferies. Your next

is open Your line

Adam Bubes

Adam on wondering just any you provide if demand stabilizing was this like is signs you detail for in I'm Laurence coatings, Hi either Alexander. wondering Bubes around and I was TiOX, end weakness markets of paper? here? plastics, in your saw demand could any where

Mark Newman

continues know, be, week. Asia to Geographically you a

we going gains we've continue the plastics, you on well. continue laminates And some assess to know, made know, court know, we you some we've weakness as in forward. But, share earlier, that in have regain, but there. to we then you seen As said

Mark Vergnano

be Coatings fairly strong and across. stable appears to

Coatings weakest. be opinion. side. we're you say Mark's And stable the seems I'd regain to plastic all know, Asia to now regionally, on some has point, seeing in So, long our the been year

Mark Newman

to And market. be the North strongest is continuing then America

Adam Bubes

And from After portfolio was potential I Chemical Okay, simplification great. a shutdown Thanks areas lot. Solutions, last question. wondering the my for in just here on?

Mark Vergnano

Yeah, right – it's of we our grow. and do where at have constantly place is terms something in where's the know, look we of invest to portfolio, the to our what terms in you best

seen I will very So, that. since the you our be around think portfolio to aggressive do continue know, beginning you've us

Adam Bubes

very Okay. Thank much. you

Operator

comes of from Your Vincent Andrews next Morgan question Stanley.

open. is line Your

Steve Haynes

Hi, Steve question margin ask continued was slide And there wondering Vincent. Haynes comment the I side just in for you TiOX. a deck. was is and on This guys. on compression about the know, maybe margin a

essentially Thanks. about year-over-year kind that the quarter of in relative So, and on you a in be did you thinking what basis will XXXX? to third

Mark Newman

to the have know, lower volumes. you a absorption with impact on margins So, this year basis, due know, you compressed the fixed year-over-year cost primarily lower of our

this with being year know, delta stable. big is You the volume price relatively

expect, forward. know, very is to know, our capacity that, share fixed availability have that we're going we we dynamics know, we've And dimensions to we would you of evaluate And you in obviously, very as regain do do of absorption. as better to you market against a time. You cost continued our thoughtful other over know, move And, thoughtfully. plan terms

Steve Haynes

specialty could, perspective? overall TiOX color And business strategic the there in some just from you the on then follow-up maybe plan a to provide maybe on if

Mark Vergnano

played area role are hasn't some when areas, the the fibers. you These Yeah, specialty an know, industry, a this you here. and things that whether most into is areas get those breakthroughs are big especially had We've follow – technology in. part, that breakthroughs you for chloride of TiOX

we talked much about. product. instance, with in brighter grade into new the For a with We get market ink the can that

some other products So that have. functionality it won't maybe allows

roadmap that marketplace a next that way in have we we XX nice that as us where I either our that offering that unique into allows we're allow and all And that of a have trying over from bring in area. added in to be bring before. the nice to standpoint. will our has I the is different introductions team customers technology functionality exciting TT the before, months of what And really Mark to think a job to customers look do different use or in haven't into to evaluating a So our honesty offering we been them for at think how done product mentioned offering can areas we or really get better a

So and that this us for for we products areas future is see us our growth for enhanced customers.

Steve Haynes

Thank you.

Operator

Your from P.J. next Citi. Juvekar comes question of

is open. line Your

Eric Petrie

Hi Mark. Eric Petrie for P.J.

to What Your XXX million. get target? the XXX the operations are cash flow levers pull to is from million your you year-to-date

Sameer Ralhan

this quite cash working look in Sameer, the where And the typically of if right, full a a little earlier, Mark are side is focused unwind you Yeah, QX the Eric. as for heavy. are raw as year, to we that's capital free at bit Essentially on mentioned we well. flow tend we material have on

drive going value how are So we creative to are options a in we to that looking at bunch of way.

around it's that can the drive going all working side. be else and So side to on anything the we cost capital

where to. about good need get we pretty to feel we So

Eric Petrie

end think with your expect? sulfate Thank fibers switch chloride grade in the you. inks and you secondly, what into to And customers introductions of market. kind end from Do new uplift those And margin specialty you grade? will do

Mark Vergnano

that. a think I can to you you give good Yeah, we don't know, forecast

just it's product And customers. come You know, to, them this introduced. going down their in right the They sample with just today We're have versus really more them to now. working opportunity give more are does value, portfolio. to they or being what our got

is, about it's just not just about as I capacity strategy strategy, not just contracts, the about TVS new having a drive TVS total of our not said, a fits new as think also it's and the offerings product of low as customers on about that. I right they increases. this cost part portal, in But and it's It's So these of really adopt really it's pour wheelhouse strategy offerings.

Eric Petrie

Thank you.

Operator

comes Your JP Jeff of next Zekauskas Morgan. question from

is open. line Your

Jeff Zekauskas

Thanks very much.

about I place tonnage do demand, some that? Tronox industry of it it's X% are just about shrinking, contraction context, global of you I the think X%, think you this maybe that like tons growing, that, know people maybe this classically titanium this know, your or volume X%. in the year. know. looks X%, don't you think but X% industry don't or dioxide And I know, dioxide down, you year Can which also in What titanium tonnage you And production is to sales that's equivalent enormous. XXX,XXX down. know, volumes

Mark Vergnano

is say think you're the probably on largest been significant seen in Yeah, And history the of don't no, have significant And across Jeff, But destocking in any one. people would event the happened that the that's I don't you this felt world, industry. going we beginning. has a world. destocking market Two number events know, across have one this the you right. poll I that of

to to when be we alluded probably said, he create the you incentive know, need Mark much world to of that before, know, able You don't across an demand earlier here.

just conditions the So across held uncertain GDP. I think time, market at significant a board, same you've the that just combination of have destocking had barely down

decade. world last we've biggest remember, around world the been the been has seen GDP weakness growth Asia the the has driver of around the And Now for Asia.

need think when dramatic seeing, is I us So for that's that we're together, in what very the all see I to you think to why change TiOX. dynamics a don't market demand you're to to pull put which going

depending at happen around a view, to the could Right that on point now, a think I relatively don't just going line just the of markets conditions. of what we from macro have market clear quickly, do think our to sight much dramatically, from significantly the for customer downstream inventory change board, levels them. as the and all across because, across before, base low take are this I Mark doesn't levels said it but

Jeff Zekauskas

PFOA CX declared follow-up, profile ultimate the does or substances Or affect companies that. that or forward? think is of liabilities? these Okay. been If change don't of then that costs only taken as the them is, you things chemicals the go it's it's have whether responsible it how these it who's declare in the And is Thank the for responsible That hazardous whether PFAS already the categorization chemicals for affect of would you my how EPA does for XM, has substances, chemicals be somebody regardless that liability EPA. know, And that place? or for I cleanup the does else. for hazardous DuPont you the or by

Mark Newman

is they that standpoint, right. C-X all, a time. of was will what speculate happen substance by It hazardous first us, does not never from of EPA that we if based that chemistry DuPont remember decade is in now, you're in the longer. standpoint. ago so Yeah, that did. We way approach. not can't point is the But got don't CX from out a almost you participate We this in this are for considered EPA a know, at usually science absolutely declaration. any – Again, a the very

to situation start out really at choices that. talking that is you're EPA. handle of The there happens want about to how occurs? that of with. So What they EPA, the would has up Again, legacy to lots that if point,

what mean speculate the I So hard, think future. in to really it's Jeff, would that

Jeff Zekauskas

much. Thanks Okay. so

Operator

final come Jim SunTrust. Your from questions Sheehan of

Your line is open.

Pete Osterland

to for slower negative for Thanks. been over price impact Opteon or This portfolio generally Osterland is been the for blends? Opteon have the margin the the your margins past ramp of any On couple stable Jim. related quarters? Or Fluoroproducts, there has Pete

Mark Newman

primarily impact know, It's of volume a story, you with the imports. illegal

with, contractual air you. mobile to better digit the Thank side, see, on said price going our we into get know, double corpus we ramp know, technology. on up our conditioning you you HFO baked COG obviously, is the As growth forward. you earlier our I revenue declines And, know, volume side, plan continue on to as some

Pete Osterland

Thank you.

Operator

I the remarks. return for will Vergnano Mark to closing now call

Mark Vergnano

Thank we're want in look for while again, in And continued you we Chemours. your Thanks And to I quarter. Chris. you, here this the you interest everyone on seeing morning. for again. forward the your thank time road to Thank fourth

Operator

participating. you for Ladies and call. today's gentlemen, this concludes conference Thank

disconnect. may You now

The Chemours Company (CC) 5 Nov 192019 Q3 Earnings call transcript