CC - Earnings call transcript Q2 2020

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Operator

Ladies and gentlemen, thank you for standing by and welcome to The Chemours Company Second Quarter Earnings Call. At this time, all participants lines are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions]. Thank you. to Lock, conference Development Vice Relations. like speaker to and now Jonathan today, President would hand over the our Investor I of Corporate go Please ahead.

Jonathan Lock

earnings Chemours Good Financial Officer; Executive Officer. and Sameer Senior Chief Second to Ralhan, and and Newman, Vergnano, The President Officer; morning quarter and welcome Mark XXXX Chief Operating by Vice Chief Senior Mark President President Company’s and Vice

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

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

Mark Vergnano

for everyone Thank you, Jonathan. And you joining us thank today.

and challenging months with Americas. last Europe And times. then the some unprecedented in It started COVID-XX, in living remember. can of the in of Asia, three the I been first are We most

I'm tremendous half the witnessed a to these In of this Company's takes awakening stage of extremely May, response in the events response. and center incredible the both societal social first late in collective of have saw proud resilience proportion. of spirit XXXX. our human we of justice We dramatic

acted quickly and a more face scale to challenges will have as We global result. head-on on emerge and a stronger united these

response Regarding our strong. all all COVID-XX, we proven across measures effective and call, safety Early our our as said maintain across swift operational implemented sites first footprint. was quarter our in have I and global continuity

engaged. the continue current in surge cases health United to internal the our through fully manage States of We and epidemiology with team

people our Through to the many As we all, a decision maintained have had it tough yet leadership team, true timely, worn has of make north putting we on. as pandemic our first.

As a more company committed we and coming this to of competitive. stronger remain out pandemic

focus company. for the type George reframe safety practices of into number our civil murder taken all includes including to and of social of and we create reflect of entire to We value us to own not to put and kind more policy programs company. and training team of emotional commitments in corporate internal the They a include is are those are the unrest better generation. firestorm form programs our set why with racism. zero obsession of a would website new a XX/XX to X,XXX as better behavioral new toward His about the many up interested has. a this types and more of has Chemours issues deep-seated education Floyd including to to unfortunate rethink of of think justice. Turning our of society death company. holistic of not learning expanded May actions XX our leadership The chemistry in the seen all And protest on responsibility caused strengthen our and a it working of tolerance regards and for our safety This invite basis like inclusion had opportunity information. psychological of discrimination company A Chemours. of An inspire and any that in I commitments the elements to us. along is to and practices. to These world the expansion visit across norms our diversity employees

to COVID-XX end the well Moving market and on we in driven results. the weakness nearly quarter started which first every which second into serve. extended The the impacted

global impacted by COVID-XX. the macro severely was While

by our Our impacted second as idling quarter headwinds million]. manage quarter second the drop [$XXX across prove facilities the rates in resulted production we a EBITDA were related working COVID-XX response cash COVID-XX of reflecting solid of Margins plan. in revenue flow by several resilient, low execution sharp adjusted company. with capital

are on through and helped As to call, we generation and with quarter, trough. the said our maximizing jumped cost-cutting this focused into actions In cash the first some the action cash in quarter team on the conservation swift headwinds quarter. second of demand I offset

as to our to the focus around were we of in second members an able We free the team us the each have quarter. was result But versus flow to world for applaud of cash second we this million This of growth. of turn result. XXXX. $XXX still improvement $XX million a contribution of head our work generate quarter excellent their As revenue significant I'd to like

$XXX credit the [technical end second of Our remains a we difficulty] on with draw billion. facility. balance cautionary $X.X maintained ample a At million sheet the quarter solid revolving

June wave the the we're beyond ahead, Since in Looking of to in week bottom we have patterns weeks. forecast Barring ongoing mid-May. remain customers to while clear. coming economy ability with recovery, improvement virus, limited is each order and hopeful an then, large begun not And July. consistently from global we stabilize our the believe our view in second of into a

the recovery. enough enough a and not sign, While trajectory of project do we the shape positive yet have data to have

second first As to a do we and prudent for quantitative quarter it half. with not consistent guidance result is practice, believe our provide the

the we last quarter response I to over items financial proactive I'd to our Sameer to things commitments turn quickly detail, made review in to to to purpose some our starts COVID-XX. results I and all quickly these have significant of chart and your that investors with we to the use strategic with our financial It customers first. earlier. and and company. reinforce We putting covered this Before the to create cover employees But like wanted for flexibility acted

our masks not disease. of down and social and spread on back help have We procedures the our at health requirements the PPE to distancing and limit use continue to sites

we have to in need We and pandemic supplies to help in help position supply advice during and continue to customers These in spending, across took by those CapEx proactive We temporarily remain early PPE track. to measures and our this conserve cash. balance and communities operate. salaries a which other sheet to fortunate on programs our with down chain partners the reducing scaling be been bolster eliminating we'll discretionary

bottom, be key perspective, move vigilant cost from we need cautiously of the markets. recovery will a we the off continue to the momentum mindful into maintain in invest to As and

over the have well about our grit determination Finally, prepared in and was resilience for this recognize else quarter. short hand review late shared effort to on spoke comes here know which want resilience to With this entire no full hours things that Sameer Chemours call, and is quarter long results. The the and of for sacrifice together. the on get doubt the display past I quarter, that, first I we're I we financial way. Chemours' I'll our I nights. to second history. through whatever our team their will defined That

Sameer Ralhan

Mark. my comments on I'll Thanks, begin slide five.

titanium while an from volumes markets. to $X.X COVID-XX cash $XX principal the free at demand income GAAP was share, GAAP Lower was adjusted Strong per with $X.XX in share earnings quarter per and same was working high came driven contributed lower strong XXXX. resulted share global management, million in technologies share. margins per across most cash improvement net by impacted revenue products income lower $X.XX flow million. quarter million, per the quarter million, cash across while net operations and of the flow CapEx versus was in combined two Total $XX $XX in as result. billion the adjusted from production costs earnings Second capital flow Free $XXX XXXX. was segments.

$X.XX from will payable record unchanged be directors our dividend XX. board August of This of Finally, share. of of as approved prior and is quarter per shareholders to the QX the

six. chart to Turning

Second due to $XXX volumes XXXX. adjusted million, impacted was COVID-XX EBITDA second in quarter down three our Lower XXXX quarter from segments. of $XXX all million

Improved mix, million price. high operating gains We company product idle improvement performance fluoroproducts more unit year of charges also costs reduction than experienced ago. down and lines. efficiency customer and lower lower operating in In the efforts average the sales offset selling due price prices as the commitments costs well and due and F-Gas of product to period quota other were across some same and $XX and contractual in a titanium cost total fluoroproducts in timing to versus and technologies production lower as

next the to Moving chart.

liquidity strong. Our position remains

Our the U.S. dividends. balance and CapEx form end billion, $XX at quarter, to million was In cash approximately shareholders in the of $X million cash. on quarter $XXX spent second the we return including $XX of the million of

response strong earlier, we of Mark COVID-XX draw to market respond to plan million our on provides significant our As credit facility. revolving quickly a mentioned flexibility the financial any execution The maintain cautionary disruption. $XXX

to chart. the next Turning

balance You help chart calls QX current our on will leverage our and we to position. this use out recall lay liquidity sheet,

have balance we ample sheet of But capacity. total, source considering over a million our believe to billion $X approximately we liquidity cash, $XXX approximately continue remaining maintain just current market billion is draw. million including $XXX have revolver revolver In and We of of $X.X strength, of liquidity. conditions. We global

senior level. is two secured below maintenance current net one well of approximately covenant the times Our leverage ratio times

Our and nearest XXXX. maturity with spaced in towers balanced maturity well a are

our we the today year. over well-positioned cover for to results. conservative I'll new earlier now given our segment But financial call the to we are took Mark to will turn always opportunities we Newman course, actions Of improve flexibility. I in believe look the

Mark Newman

Sameer. Thanks,

kept costs comments. preserving while cover just action underscore we earlier segments, our team safe, plants our around some running cutting needs, into people cash. and met I let of Mark's all COVID-XX. And The me Before customer Chemours our and sprang

stepped inclusion chemistry also all up efforts our kind of diversity, company. We commitment and part a on being new of of our

let's challenges potential is to Fluoroproducts with Our in fully on that, is we uneven an gradual nine. and results focus move the of the the recovery. engaged, by us. daunted from growth chart The team second this profitable not are point With beginning quarter, revenue in and ahead on

across product reflect plants was lines end as shut impacted Second fluoropolymer a quarter most fluorochemical for the number Fluoroproducts demand weak of with America Europe Auto in COVID-XX in and North market demand. of extended periods down quarter time. and sales lower volumes particularly

reduced X demand in in demand impact business. the of this Tier As felt end We second fluoropolymers automotive immediately OEMs. to by Demand and for Opteon severely almost was less Auto quarter. in fluorochemicals supplier a markets HFO components impacted refrigerants industrial from our

sit given in However, EBITDA other legacy total, impacted demand quarter where and in came chains QX. we half. refrigerant in margins mix, headwind was we the quarter in adjusted first X% value at Price weakness $XX on the the as in XX%. of the bottomed product a second million customer and In for pricing by expect polymers, automotive with

the in adjusted the and quarter F-Gas and sites. factors more fluorochemicals business. the across idling shutdowns impact of line EBITDA cost production limited efficiency our improve offset Our reflects than on productivity side the and of quota primarily These efforts sales,

remains outlook demand the forward, Going mixed.

While auto recovery volumes OEM here starting in July. there been some in has

and volumes to cross likely see a to that are believe yet on the we in industry a coming over demand. May quarters. sustained have We bottomed path in recovery recovery We

more Tier into a as to fully expect rebound and X our supplier. quickly fluorochemicals demand recovery, OEM auto margin we move given we exposure As more

lag markets. in that of On fuel Xg polymers, the in which confidence in other we in the will essentially other networks, the and and Longer unevenness growth to term, continue back be of to potential supply as further the fluoropolymers polymer given cells areas such we we're chain hydrogen Generation hand, expect Next have our recovery infrastructure.

the XXXX. of our our impacted next nearly were year. customer down XXXX of Adjusted rose of and cost from XX% lower Sales $XX revenue which reflecting was the the quarter second in million Let's margin chart. turn from reduction mining quarter in MAP in Americas improvement an XX% the solutions. $XX $XX efforts, in million, timing the business XX%, chemical XX% and solutions and reflecting margins EBITDA the on portfolio shutdowns across sale in reflects mind from segment Adjusted quarter million to point management EBITDA improvement basis prior This actions. the second the

the For demand the full to as minds we balance of year, return operations. to customer normalize, expect

readiness. full generation year and actions, our to on operational cost focus cash We continue reduction

of to part business efforts the of down to our your efficiencies, end as portfolio, at effective year. continuously our made shut operating decision and Finally, the Aniline manage we improve the our

move Technology Titanium Let's chart XX. ahead segment our to on

Chemours. year-over-year consistent value benefits low down e-commerce basis, strategy, expectations XX% was volumes headed the over decline, in as in Despite flat with the sequential $XXX due Pacific. testament a Overall, in a soft sequential our see to North X% quarter basis volumes XX% a compared our the sales driven demand helped has our to trend Asia demand. customers of year. basis, of were price quarter. into Our to on their America stable with and Latin on were by primarily Europe, down in last end of down market a was the million and a lower the this DIY the The has the resilience on channel America decline been bolster relatively TVS partnership flex and

to XX% absorption share market supply Margins down buyers reflect due $XX a contracting a with While of production favorably quarter to add as TiOX first In sales headwinds offered contract based experienced of we two XXXX. and continue impact second related as of modest levels. we value more we of to demand certainty AVA trending from the the EBITDA whole quarter, the weekly as the through significant second TVS. were low the customers exited recovery quarter. cost of attracted lower reflected XX% of in months million our to fixed the Adjusted COVID-XX, quarter June, was the

based world. global believe in our the the recovery. markets we of coordinated their patterns differences of disease stages path ahead, around will and the regional recovery. laminates coatings, emerging of market follow With Looking a we're on end architectural regional of early Downstream, more ahead plastics demand

broad Flex continue portfolio Ti-Pure that and we AVA contracts, with to customers. well-positioned our believe We are of distribution

this customers our their to pigment help back to meet needs continue things dynamic over will I'll Mark. We turn periods. through incredibly now

Mark Vergnano

some my close with a to observations third few also in like I'd on global here on the thoughts seen the Mark. Thanks, we've what prepared and remarks early recovery. quarter

Our conversations downturn. customers marked order patterns pandemic of indicate the and related that book the bottom with demand QX

markets. We One major recoveries to half barring will here play stimulus of stimulus, be that see believe of the strength major us a We specific for our of open but the the to announcements that particular core be critical are trajectory With support people for and to and the synchronized the The of customers. recent wave in will the to everything hopeful will will run are allow segments stronger experiencing do this role we participate. please period recovery, many the of are business news will a area additional Europe yet questions. the of back continue doing well-positioned line gain prospects over to to and from in we global in restoring positive, regional infrastructure flow, can which strategy year. we in U.S. impact then and have continue second which Until sector emerge in and for welcome across maximize while closures believe growth This stimulus in the cash economy. we measures we our a from markets meaningful the operator, growth.

Operator

Thank Instructions] you. [Operator

McNulty Your first Capital question comes Markets. from John BMO from

is line open. Your

John McNulty

Yes. Thanks for question. my taking

say, it's contract. AVA this It guess about on when you past the had the sounds signings, around be first a market ability your gets of think more one the guess maybe the coming those do and supply you on side? price uptick So stable to you characterize in more decent it's that? tone more to discussions all signings you I would I would to concerns we footing. How the hikes like would XXXX, consistently the think about as quarter. look a on Or as about deliver you

Mark Vergnano

in this. share. play require good we a commitments commitments say, market would extremely we to to in morning, I our contracts contracts. to remember, When well got we volume, steady like AVA don't you AVA Hey, to require increase But period John. see continue

we're so now. an to And right when Flex occur like that this economy seeing have you allows

that's asking relationship economy, the your Two, an when draw is supply how So think price security of point. things get you biggest also I turn to commit somebody down do to one, to the stability. get aren't we volumes because to you share you the But here market in the its calculation.

from it's So price, I a standpoint. in a contracts volume the frame our the think customers, it plays way all or supply, we positive whether to it's surety whether whether way

John McNulty

Got it. That's helpful.

Sameer Ralhan

the I if just complimentary. the very Mark, channels and could are a Having here add bit. Flex AVA

Mark from in said, And we AVA. move that as a channel. So, build people, Flex relationship the to

few a adding we're that So way. in contracts

also predicted is contracts contracts. would stress market the a to is, And number that AVA I from we say opposite. I'd were volumes in is what away AVA would in we to see This markets. important cynically what's had these allow customers walking very our of think just modulate folks this people our designed a

playing our are So strategy wisdom portal they our proof both out the of where as I contract flexibility folks the relationship Chemours the the design. and as well of here. and of the think is with And wisdom begin Flex can TVS is the benefit AVA a seeing

we're I the we encouraged by in So what saw quarter. think very

John McNulty

a we as brought how headwind back as should cost quarter? to thinking that update side the be in you guess, can the Like, third sense. that XQ? number an give dipping to plants may plants was the No, then on financial many you throughout you it. guess indicated about that of look then, just And be And I somewhat what quarter. we absolutely we can you around how proportionally, you second have the Got you quantify as idle on? makes question, can us of had I impact those

Mark Vergnano

John. Yes,

the assumed like What was look think to play second probably that, Fluoro. it primarily of automotive we was downturn. And side, the of It what turns when the out, it because because were some refrigerants going mostly going have or we network I we was, of quarter were idling thought fluorochem facilities. whole -- down across way said be the would was like. to

And So going probably third going had we than higher assets. into those a our to see saw refrigerant the really seen you're I chain be of to idling in the comments is that's lag immediate, months a versus side. we of continue terms have fluoropolymer X three Because say out of probably customers. Mark's shifting we anticipated we're because the would level. bit fluoro. now some the you from we've assets in supplier in go to That automotive. the fluoropolymer probably It's of in our margins lag quarter, in our same in to be as upturn to before, that refrigerants. and what fluoropolymer little about because We're a effect seeing of margins the going why our Tier to

haven't else. see of fluoropolymers. more probably idle in idle much you'll our production production some So Today anywhere had we

John McNulty

very color. it. the Thanks much for Got

Mark Vergnano

Sure.

Operator

comes question next from from Barclays. Duffy Your Fischer

line Your open. is

Duffy Fischer

morning. side. the fluoro Three just Good Yes. on questions

hear that HFO what's so, last I HFC turned right pricing would impacted HFC And at then, said look that pricing you driving you how in And did and much pricing you as First, the if in all Europe year it? weakness at that? over in up. Europe of has kind has

Mark Vergnano

And prices the I the HFC I automotive industry. sales blends from standpoint. the standpoint. And we've perspective. effect wouldn't HFO contractual stationary seen the quarter their imports most of HFO haven't which we've the really of a contractual would any -- up. bottom. Again, and less then, going with from that we've we pricing with we Duffy, haven't the are Yes. seen HFC think say from an say that pricing seen are seen relationship side, think China into from turned at end seen I I it and

we have that the haven't but significant probably uptick seen seen of we So, we've HFC a bottom in that pricing. pricing, felt

Duffy Fischer

your in ramp? The around quite communicate wasn't dig and lead to -- little what as ramp for both to fluoro deeper, flesh lag back a you ramping in up parts ramp about volumes do were should there, just I think that's going trying could volumes versus worked your vis-à-vis that of down then, and Could volumes that start be I fluoropolymers back is and clear And auto just you fluorochems. to you how your to in what up? inventory auto Okay. needs they out we those

Mark Vergnano

Sure.

on a all, side, of X we're first fluorochem Tier So supplier. the

that as see you immediate So facilities impact up. coming start

the side, On our XX% of probably, automotive. fluoropolymer roughly volume in is

you're -- a automotive, in primarily we're electronics, In an and areas just side, an the in. our the of side back bunch you're we're automotive fluoropolymer way cable, that of it's wire So industrial, chain. there's

see two, inventory So there it delay. yes, to in get channel as its through, that there's as to flush probably way to the happen, one. as order through. But start patterns production that that primarily to in already has we inventory But that's that has stronger, think starts of usually work

Duffy Fischer

guys. Thank Terrific. you

Operator

Your next question comes from Bob Koort from Goldman Sachs.

line Your open. is

Bob Koort

very Good you guys. Thank much. morning

Mark Vergnano

Hey, Bob.

Bob Koort

get some one stabilization clients, Chemours relative when other takeaway companies. question playing might sometimes about to strategy think Mark, they investment upside from the is the whether And of I cyclical in price

can little in about might what do? start then, you what the for regain up the margins maybe a trajectory of of talk tighten So you you future does you again start world the incremental the how you would kind price market And if expect to as to response volume? relative see to bit

Mark Vergnano

Sure.

say, standpoint. increase. on price low have just volumes there, maybe I'd Let to But seeing and in quarter Mark look right we stability we're more our me increase. to third margins utilization say, I'd that start because help We've Newman a now, volume going second. going mid assets. we're can as start to from to that's the add teen now seen at And

want to a on place your independent margins more have utilization really where from that assets up your get So price standpoint. we're to at you of

we PPI up the which our forward, move -- have somewhere the Flex will right. what channel, majority, to obviously from to channel today the the allows max. of to standpoint us needs XX% still on it move protection conditions We'll to But price maybe the but and marking that Flex And not wherever we goes the based in what very AVA XX% customers, is driving be contract happens. price price be As XX% have are. range a at

can that are we is to of at in them up our forget of to of a of on a some proposition also them stability. I time. that the the give participate But we else in price who AVA on contracts I'd part those much probably customers you to So, But value say from don't our the move want price if effect our give utilization terms on assets as margin. anything mid-term anything impact has don't have Mark, in to know a that. add you margin level perspective.

Mark Newman

the I would -- just has on have today. our a utilization future room based lot meet big obviously, Yes, then to that the grow re-echo we And demand significant -- of operating Mark. leverage. to points

we to price continue can flex significant across the available distribution take or have we becomes market. a it We in And advantage channels, with and as both run circuit. as the our plants

from our Obviously, believe price in agreements, like in provide the options as of our we to have the volume that stability significant to our channels. both our take us this customers to and I is real ability point customers. Bob, several So, and there merit those and AVA here we real forward and move

Bob Koort

Mark. that, for Thanks

go terms the as you of has ore high. a change the your last just I expect ores But there's you've acquisitions upturn of costs. what your mentioned little mix an it traditionally, us ore downturn when one supply. in to we of would more? give own you've and to with bolster slate of you lower year would suppliers. to tell done I changed Can guess, that know in over done demand in skirmish You also some grade if some then sense cheaper supply? you us this Can how wasn't a that lower your

Mark Vergnano

Yes.

is Our job to..

Mark Newman

sorry. Go Mark, ahead

Mark Vergnano

I our that and was try Bob, to ilmenite the time all advantage advantage we obviously standpoint. going chloride to that utilize say, is from

our can. lower than can chloride network We in levels So utilize we're we operate much as much ilmenite going at as others to ore can.

a want to time, do we that be the time So in this. all able to like especially

us ability process you that that basically key beneficiate our standpoint. to sure utilize how So is ilmenite. is a from for chloride is have that a advantage strategy do a we And of in obviously, for process take

right So we're straightforward be suppliers able contractual feel be that. now. But do a to issue to always with going an at of to from that Yes, issue contract very one the something that's standpoint, that looking having our do. allows us to we is ways we're our that

nothing just we into there's So, anything day-to-day. -- business that don't how way our operate of except normal read

Mark Newman

great add And internal Southern only down we would investment and requirements. I has That very is, Mark, increase to up thing investment the to the further go supply in made about a well XX% Ionics Georgia. in continues to with potential our our of

Operator

Your next question comes from Josh Spector from UBS.

Your open. line is

Josh Spector

for Thanks taking everyone. morning. question. Good Hey, my

get I the chemicals in so as quantitative declines polymers, if possible volume segments can kind we the quarter those in wondering improvement terms by well? it's sequential to of in versus Fluoro, was back frame just Just of

Mark Vergnano

to you talk? want did Mark,

Mark Newman

the didn't question. I I'm hear the of part sorry. first

Josh Spector

and Sorry, you down fluorochemicals fluoropolymers? could break volume year-over-year just were by the what declines asking about if

Mark Newman

Yes.

So auto about should year-over-year, say being I'd down are really closer to down we talked the about think volumes is overall, way you significantly. XX%. our that

demand XX% volumes line to with XX% I product line down XX% XX% down think range being in. polymers down. impact to XX% on to Tier of auto in you're kind the a directly then, year-over-year depending And that XX% the or industrial in more being range, supplier. X Again, being as

outages as upward two tale a in auto of snapped this teens. on North in businesses. is revised of is see very based mid fact, July. Polymers in the Auto quarter. back kind other this and XX% hand in being And saw industrial QX. we as both American with we That Europe line in think down come we into down on So, different to of the significantly, XX%

as a said Mark recovery to one demonstrate earlier, We in polymers lag. expect the quarter

And So show very be fluoro actually of business or but go starting we'd in then slightly our continued will QX. as see some recovery businesses. in recovery, in up polymers Overall, with to we economic polymers different see would a QX, be strength it'll we the expectation into starting decline our mix QX.

So just it's a on quarter lag the polymer kind of one situation.

Josh Spector

helpful. And on Solutions, quarter. mean, Chem good I just pretty That's obviously Thanks. Okay. in performance this

margins Just they do this holding higher there anything was were? else wondering have would as Or be demand see that it anything margins quarter, you this improves, money in licensing quarter? drove income unique or where significantly

Mark Newman

Yes.

obviously think we've guided better I solutions the should of this business. this roughly XX% you a think EBITDA way chemical to We're is being in quarter.

slightly on say the impact MAP would second this below. think as offsetting took close some is actions where announced everything quarters mining half think I we half took get of think somewhat portfolio actions above perspective, say the we're when sales to should some closure quarters out, both margin from would we this solutions of to the this methylamines we'll I timing being I But the sort well second we relates business we that get start quarter. that our where were year we and as business. have XX% won't of expect Last business, a our helpful year. we we cost slightly year the the did EBITDA as to when that in recover. to you of of you as And net we're

Josh Spector

Thanks. Okay.

Operator

comes question next Your from from Jefferies. Alexander Laurence

is open. line Your

Laurence Alexander

you've sense for regulation total in you up net us Can illegal step be? the context had give refrigerants a business to would headwinds what there in if morning. effective the that were area sort of Good from put the

Mark Vergnano

were year. Hey, that, a very Laurence. million probably Last year for $XXX we EBITDA the clear headwind about it I think was

from for gauge That's I So explain I that think can would a way that really standpoint. to that the be good probably negative you see best is what that's it.

uplift an forward. there's us uptick for and obviously an So going

Laurence Alexander

recovering volumes does industry, navigated starts growth when this? customers when, the the and much has the the the that stabilization And of strategy played TiOX given industry for out way way capture expect how have volume to Chemours

Mark Vergnano

gain Well, to to clear our we back that to been our least we've and market very share. want get at rightful open --

that believe we of a growth. share will we So lion gain

a the So bit little than maybe more at. grows industry what

weren't we a in things would going like driving to create be were as the also share where quarter, We we that recognize looking market second recovery period that instability. during

coming we growth see that back. now our volume So, is

As of of third low with increase to price we're I in somewhere anticipating said, range teen kind mid quarter the volume the in stability.

be as market year. coming start think end share should we to we able again the that, gain I to from

So, down market our we continue to targetedly at and will to share smartly path go the same go time. after

Laurence Alexander

down Lastly, facility? Aniline shutting is a with the there associated charge

Mark Vergnano

is. There give you numbers. Sameer can fairly small. It's the

us it in Just those a context to for have been who the put with while. for

was of basically It asset. the in of remember business sale you we the This sold If Aniline couldn't XXXX, spin. n that last complicated Dow. to for reasons part back be the

So I it's answer $X better. can you a very of But that million. small charge. it's the range think Sameer, in

Sameer Ralhan

the tied million charge shutdown. to $XX essentially is severance. assets roughly and piece tied the tied of that's of that couple it's Lawrence, Yes. million to to Pascagoula Majority of

Laurence Alexander

Perfectly. Thank you.

Operator

Your Capital next Viswanathan RBC Arun question comes from Markets. from a

Your line open. is

Arun Viswanathan

Great. morning. Thanks. Good

as seeing, well those guess, I about the in out wondering across Just you what the Maybe geographies, situation you export can Thanks. you're China. on us comment of maybe Yes. as just items? two inventory help on situation could Maybe TiOX.

Mark Vergnano

the anything and to kick through around starting sort like walk coating continues regions to now by say I the we're off it I'm well. add want to add you shift us, been of North here. That's for you of to DIY. if hold Mark, to TiOX contract over a would business see Yes. up and painting. to fairly type driven America primarily side But the that

that's to think I starting So, resume.

a Latin America improving. and improving. seen America Asia Europe maybe little is that's improving. Latin We've surprising

has So and has play coatings in on to be Packaging PVC. PVC construction slower has polyolefin on the been trend seems Plastics held batch, up. as packaging play master We improving as in lagged. well recovery. across. overall an

could start will any probably been infrastructure and most help driving the stimulus that. infrastructure that hopefully So sluggish three. Laminates of the segment has the

TiOX from at same So starting a the that the about China as economic is the segment obviously positive of think an point view, time. China to largest of get region most Remember, from is user region you and a direction.

a of get country. out China starting So I consumed think from of to exports was capacity now lot is that excess in coming

see you're to exports So least our because I China think of thoughts. at going That's less our that.

in our see And a would that's seeing I anywhere why occurring quarter third improvement don't big build our we volumes. So we're some channels. say inventory in

through. start Mark, passing either? I think to that immediately anything going want to you're see you

Mark Newman

the and of had industry. the it Yes, destocking is Mark. crisis say, the I'd lot global differences made been say in we some of one year financial comparisons principal difference, have last the to a

So we're coming into than were crisis. experienced this levels with, I think, global different inventory in the financial

markets to market APX Latin a now strength but China look continues showing are strength. again, places North in be think or is relatively China starting us. at like weak, to America quite was but America show India. small And weak, we for As and globally, resilience I

very by mix, QX. our into across the volume our we the we see that both that about drives that increase encouraged really and we're So, signs talked geographies, going channels, and product

Arun Viswanathan

And that think in potentially I but given those North pricing think how Europe? about you or in about you do see America, should what increases regions, mean, it in just I possible we I guess, guess, Asia said. not Or you how is that?

Mark Newman

is in seeing Yes. China reverse picks dramatically we're demand QX pricing pretty What fell and up I that market start would say there. certainly as in to

that So good globally a we phenomenon. think is

prices in saw the that to forward sequentially outlook going with price is you even was for the in our our we're And quarter. As remain seeing increases QX our stable stable. volume results,

to picks where prices As But that about more could demand and prices there quarter China in talked Sure. fallen up, they sit the now is had starting here think other in we pressures? stable rebound. are view dramatically fact the our than remain I be today, pretty pricing as globally

Arun Viswanathan

I'll turn it Thanks. Okay. over.

Mark Newman

Thank you.

Operator

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

line open. Your is

P.J. Juvekar

morning, Good Yes. everyone.

Mark Vergnano

Good morning, PJ.

P.J. Juvekar

tell any management? hydrogen a of you refrigerants fuel cells. just orders having in heat with for actually and refrigerants for exactly kind Have you minute maybe are seen take are What Thank discussions demand what Can and mentioned, you customers? you the used us you. XG Mark, yet?

Mark Vergnano

Yes.

So non it's refrigerant. fluoropolymers

reduce we goes liners, big very, remember, polymers are of PFA tubing, That that's uses polymer in when to One So Because of equipment semicon. into melt semicon. our the most most our very the and very of line. electronics the primarily the end two most to is, into important you fab fabricate make contamination. areas those. polymer have semicon It goes a a industry high

built, fab a directly. when have So we new those orders is

huge we had in a up have And the surgens So semicon in that. And that potential America continue to positive the years. industry North is for us. for we've surgens up in

So into able we're work with standpoint. our to to being also looking goes as forward materials customers there that It from well.

to crystal polymers XG polymers the and don't you that as frequency go you have to traditional of like high So requires, liquid work. XG level have

to have fluoropolymers. you So use

development application side potential of about And growth we in area sell have we think we'll us. of the today. that's that So is in hydrogen really front high The membranes.

for the So that is Nafion of and membrane think about choice fuel for hydrogen generation. have. Nafion cells membranes we

area that's we in of growth our sell future. today for a many huge to the So think us We customers.

P.J. Juvekar

an that Thank just talking if Ohio I you lawsuit is you've update solution? And your that come regarding with a update? us collaboratively DuPont guess just about DuPont. you with to work color. a for can way discussions there any my question with to give MDL had and up And is,

Mark Vergnano

I on what just I make part want sure, I'm. would DuPont? collaborate just sure, make PJ, to

P.J. Juvekar

these fund come address with issues? up like or collaboratively trust Potentially in that Well, the solution. future to something a a

Mark Vergnano

Yes.

and something that up And for work continue to shareholders makes will there's. with come we with that our them. sense I'm convinced We

the As the we companies. probably arbitration we go to said, I've whether always litigation, point a go or through is end be going whether two through settlement between

it's this will that. find right talk. I believe, for a to a do sets -- both is are to to These hard get shareholders. answer way we continue the of -- We But hard

P.J. Juvekar

you. Thank

Operator

next from from Jim Sheehan comes SunTrust. Your question

line Your open. is

Jim Sheehan

you. Thank Europe You that more morning. imports recession? are due confident that Good refrigerant you're due say, in about down. talk it why Is bottoms? Or is prices have Could to you legacy to enforcement?

Mark Vergnano

honest. to two the of combination a probably be It's Yes.

they very with the us. important end in in this down work they the regulators and had the quota We and very them to on. continue recognize to a very, help Europe year, hands try is their stepping at in they to are that has to for step that remember, to Because happen closely of get

uptick So, is it's driver slightly promising. of Again, enforcement, quarter. I the just seeing I toward have slight we're primary But a the call end say here. probably prices wouldn't yet. would victory the

Mark Newman

in there was the during the Obviously a add. just would facilities quite many I height COVID-XX Europe in of if offices, with retail softness Mark, facilities, market. shutdown

impact lower the work I are So, Europe work regaining we America, the out, right the is, in in year-over-year, remind we've our well ground the million height Fluoro the perspective was from Obviously, in Delta more And of things, efforts there's normal, that to to on both could lessened, of the move then the or the quarter, in amount half. second in an in at issue. to of COVID-XX, continue move when just as here which this but during we are sort of refrigerant seeing the folks and quarter you're third investigatory half. enforcement seeing sales Europe, $XX approximately back an point in And year-over-year. bottoming reopened the as called you field a on prices. we with into of are look hot we strength results do the having those getting as facilities From we're summer we as perspective, continue second new expect the to North direction a

this the worse. second into see setting the to we forward. that should as really quota as say efforts fact, And don't I'd the aside, move So, move being taking illegals improve in we're as half continue result issue that we around issue we

Mark Vergnano

volume sure, come with prices And we're make and seeing to volume that. Demand We're just the our will to business. start back. clearly back follow speaking refrigerant start base in you. to come Usually

starting back which got you get we're happen. to demand first, see the to So

Jim Sheehan

demand? us give How July in July for you. July flavor TiOX, your demand to much Thank then, XXXX relative And you XXXX? is a could

Mark Newman

Yes.

that May. from was looking June sure, been than stronger July For book And standpoint. has solid in August order is than stronger June. the

But the the about third where now So is on why sequentially, that give think think to year. quarter or to versus year going I be by a buying would feel good trajectory we say definitive standpoint. the we're somewhere month occurring. quarter very from right kind that sequential an standpoint. in That's yet positive a -- is mid that seeing teens quarter can idea we nice I the of about I improvement going quarter low second that that from you don't

Jim Sheehan

much. very you Thank

Operator

question comes Bank from of Spitz Roger next Your America. from

open. is line Your

Roger Spitz

than your you operating Good morning. you. rate. but comment TiOX Can said, rates average a plants, probably not, your other QX? on you're you if Thank don't I operating in at think lower

Mark Vergnano

Yes. what demand, standpoint. customer earlier, We see we mentioned They our that rates real products being across up, of parts in from that different our is are I about are. And are get depending are effect the positive you'll they the talk as on on rates those fairly when don't world. and when - requested circuit utilization they openly the low are low margin

it's very as difficult TiOX facility mentioned is So time. to short it I've in very the a a past, -- idle period for of

if idle you're have have around a decide for So you because to time, facility going to other a longer to things that to of assets. you really to TiOX do -- move period the usually ability

get and we signals at are through, So utilization low going additive fairly our as through I'd volume coming now, move. But be versus coming they say right we demand to normal. as that's

say So on I progress steady that. would

Roger Spitz

mentioned that back. you've And you're gaining it. Got

lost some lost back regain you of you -- of QX, you you year. a market of very in a of sense have you it's of share last where the Can are? share? to share XX%, us gained sort XX%, hard the making give You're back I Like, progress getting market market and lot recognize XX%

Mark Vergnano

quarter installed share you we the those Yes, go fourth during We third our if periods. talked gaining quarter, back quarter, -- probably and first about

it for time we we're working believe But, rightful Second was felt think not is intent to of right capacity I be that. that goal And share quarter, to about that to have. That's the not that the gain that what to should Chemours that's versus our the the an kind We capacity back to share get was do to share. think try our a should way what you What's way that is is. us have should rightful able we the level. industry. to it

Roger Spitz

much. very you Thank

Operator

Vincent And from Andrews question from comes last Morgan Stanley. your

open. is line Your

Vincent Andrews

you. Thank

couple me. from Just a

and happen this quite year? at is that First, being normally Or fall it are about Do customer thinking quarters inventory that to seasonally how are of a sort going you weaker have low a COVID XQ. off? XQ is that's point? won't Or with typical XQ we peculiar this think the this very already than think levels you because year just

Mark Vergnano

of really magic and That's keeps you. still what picture good guidance we're XQ. And not now XQ a Yes. from being Because able question. support is give the I getting think us. picture us to fairly for clear a

could XQ be said, shapes that up. that demand the quarter. would the how But a be weaker we you year, As normally weakest depending of think quarter the on

bets there's around go off. back about are standpoint. demand so right would I I Because made we've think potential points to a now. normality I'm stimulus. say So, all much quarter thinking fourth from the of one the I And a of earlier

dynamic could stimulus into significantly. especially change stimulus, think that infrastructure I

dimensions to of quarter, there. I So very think right because a for lot there's us fourth now hard call

trying the for at You side have this, people same year be going also the to to cash the other is are time. conserve of which

it now, a a of think here learn normal we All in I fourth you the think don't would few more can't in should But is, quarter. factors next So lot I as think something weeks. right I the say we'll call.

Vincent Andrews

Okay. very anywhere. nothing normal now right And there's

Mark Vergnano

I know. it point. But wasn't this super well. I for know that helpful is cloudy us as at

Vincent Andrews

for you Believe Thank I me, appreciate the comments. understand. I it.

Mark Vergnano

Sure.

Operator

closing remarks. for There are back no call Vergnano to further over the questions. I'll turn Mark

Mark Vergnano

today. I through. I actions see we But The some positive we're to Thanks. And grit starting way. we demand that And of third able to in our typical quarter made we hopefully thank revenue respond took to to And and back our us be are quarter. as ready comes to the around this. think early coming very poised and We you think had the this all team a calls. of the show result for in some because resilience joining

during you. So again, company. And safe and time. support we well. thank our you support appreciate of all stay stay Thank investors the Please for this your

Operator

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

You may now disconnect.

The Chemours Company (CC) 31 Jul 202020 Q2 Earnings call transcript