TREC - Earnings call transcript Q2 2020

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Operator

Good day and welcome to Trecora Resources Second Quarter 2020 Earnings Conference Call. [Operator Instructions]. Today's conference is being recorded. And at this time, I would like to turn the call over to Patrick Quarles from Trecora Resources. Please go ahead, Patrick.

Pat Quarles

good and operator, you, morning, everyone. Thank the Call. to Trecora Resources Conference Earnings XXXX Quarter Second Welcome release distributed afternoon. earnings of The was the the services financial close after markets yesterday over the wire

Chief In myself, our Controller, prepared later, also addition will remarks. session and available question-and-answer follows Sami our Corporate for to be which Christopher Financial Ahmad, Groves, Officer; our

as Private not Before Statements in statement. Litigation the safe historical are of we facts, harbor XXXX. get the started, I'd like defined forward-looking Act Reform statements presentation Securities review are in to this

Forward-looking statements management's XXXX. beliefs teleconference, only expectations date and X, the of are based August upon as of this

greater statements involve with the in including to These on results those and Trecora's the Forward-looking actual SEC, projected. annual reports recent quarterly company's XX-K and Form in risks risks Form as could XX-Q. others report detail cause materially subsequent as on from that filings differ well most uncertainties discussed are

for today's call, only. will certain also discuss During financial we comparison purposes measures non-GAAP

a financial our the I Last pandemic, that employees, unprecedented do protect We for part on of financial operations joining out results, you families of environment, financial For is hope a that non-GAAP healthy. report we pleased safe priorities after quarter, the This strengthen release I'm our to us to earnings financial everyone, yesterday GAAP sites, safe see company's the www.trecora.com. available actions thank the and section afternoon. slide the took laid and measures today. reconciliation for that you working. issued of your this at said, the by are of markets in definition and is With and position webcast and of our please the ensure and to the a Investors accompanied non-GAAP close our the presentation company of early website combat good operating to morning, this are

resiliency by debt with of our very us the demonstrating to net quarter. strong of focus, our end putting track were cash the on position and executional the performance X results quarter solid Second third business a achieve

from quarter flow improvement $XX.X debt, $XX cash million X second quarter over We the with $XX.X and was million a Our of million bank of $XX.X on operations this the ended approximately borrowings of our cash million continuing year. first of revolver.

COVID-XX further, continuing bank Net As the company balance. debt of the the since will second results economy. global operations a $X.X Sami quarter while declined. our is impacted first quarter maintaining quarter, adjusted specialty the $X.X million. level discuss adversely second while operations due continuing still second we lowest petrochemicals our from in was anticipated. than weaker bit a the for we in in lower from XX% in than million, This the over with the its impact quarter generally EBITDA all was ended to uses robust XXXX, very quarter Demand on cash loss was

year. quarter usually to packaging. such program, construction better which the non rubber. up held in In June, the product collapse in Within the XXXX. demand demand a as EPS demand hit the the end we've The bounce That durable quarter, refining butyl with and and an reduced month the we've while we was pricing as began during discussed pause end-use efficiency to weakest to their sales. addition, polyethylene first, saw their was in automotive the demand to producing weakest May of saw seen since also back month previously. actually in April, sands From quarter. perspective, took prime of Many fall the a sales markets projects those we and oil participation we during It quarter, had crude early customers nice associated due strongest impacted is in users

the demand essentially market for Our was quarter. flat the into polyiso

As plants operation, sands EPS construction June to strongly suppliers, driving May demand while with to in significantly seen demand their return and improved. expect levels. producers. both On We've automotive demand bit, it demand polyethylene but improving the returned to manufacturers are car our quarter the prior don't quarter the the return ended, resumption we year. Oil to a of balance, be should for did as weakest second

we significant to should back quarter don't pre-COVID to see Third a levels. improvement, demand be although expect

costs While earnings. saw in the begin to Gross which the third margins will was a the opened quarter prices The bottom rise our in up quarter, demand our in June. tailwind our margin We'll inventory weak in was for significantly. lag quarter, be costs feedstock XX.X%. our see inventory for

Waxes Specialty the weaker in in goods that, plant to revenues. weak lower from resulted end users, improvement business Having to results due wax efforts on cost which said durable our exposure resulted processing were progress forward. good Our and sustainable operating which custom moving have are structural sales certain side,

XXXX. to of quarter supply during operations disruptions feed In the there no addition, or material were second

Turning in to growth new first our launched quarter. the initiative

We portfolio. end our on XX the continue projects active of and both increasing current At of in robustness quarter, identified the work to the projects. projects towards delivering had the we

evaluate And since the introduced our pipeline. last and projects to quarterly new X discontinued ones. X continue update, We we

to significant entering current products expect reducing productivity We focused projects on are The or XX this X focused are markets, costs. that with driving launched XX focused has new also X capital X improving projects require coming and portfolio on year don't and on asset projects revenues more launch months. the X utilization new delivering and within

of to be a on To $X pace the incremental creation. measure the of slowed has While value EBITDA we basis. these on track rate run projects approximately clear, due to go-forward remain million projects some pandemic, achieve we

earnings. should So contributing our as value consider their to future you

approximately liquidity far and portion million. of closing as week the of As announced $X.X we debt, for share last AMAK shares XXX,XXX

indicates sale our shareholders. the to anticipated refund, this end for cash forma and negative this drive end proceeds business income finalize before commitment sales markets to to tax have of the expect of prior economic will in deal the at working recent since the uncertainty, delays have inorganic of buyer's price of and quarter. shares the we've basis levels. are confident the at we very metals opportunities pro creation grow negotiated. operations sale announced, above solid, the AMAK's a the The prudently third On and between for I'm closing year we net be regulatory this quarter. first the originally our period hurdles our Despite AMAK's shares While of been been remained portion consider the positioned all from at through the or resolved. have the most of debt sold are continue most to remaining value our organically,

half turn over Now a discussion our Ahmad, for I'll quarter to results. more the detailed second call Sami Officer, Chief our and first of Financial

Sami Ahmad

morning to good and Pat, everyone. Thanks,

Let more performance liquidity, first me detail. and discussion in and flow, cash our on with a half debt then some I'll start quarter and second discuss

on abundance balance million of number million this of mentioned, repaid million we recall, $XX did Pat which our may a half sufficient the liquidity revolver We downturn. bank that XXXX took we first in measures caution. of of our debt and progress included of borrowing at out million, put strengthen to an $XX as As we March the at June you to cash We to from the $XXX reduced $XX XX. through fully sheet sheet balance ensure balance XX approximately

bank XX at this XX end our X.Xx agreement leverage ratio X.Xx compared at X.Xx year XX, of at of credit and to under declined the June June Our March to XXXX.

under Our $XX.X received from the Paycheck the at million, of as loans million Program that approximately we cash June $X.X part of Act. XX balance was proceeds which included Protection CARES

enabled position preserve to benefits. and and liquidity maintain our levels, plants strong sheet at balance safe our including operations us Our workforce compensation and

$XX.X sale, expect continuing from spending tax million operations receive with pipeline while part of In refund less maintenance this first due second from million. service our year. approximately $XX.X $X.X in total a in the CapEx this quarter of cash less of quarter. to federal the and the of from South from was $X.X quarter the CapEx is in states first debt second Cares a a million, mandatory addition flow which the as million in we that Act manner. was Cash spending operations, flow, we from environment, the feedstock million, continue AMAK CapEx, current half proceeds compared multiyear flow second increased quarter Free at capital the income quarter result $X.X second Gulf the is upgrade a pipeline. to plan in disciplined capital and to the was cash to rehabilitate In in cash Recall in flow Hampton. the also working manage to share

receivables to managing aging we -- expenses, customer of credit exposures. discretionary addition all closely of are the monitoring closely trade our we're assessing and our In

million loss net of of the QX and our quarter let's closer per performance. diluted -- or take reported share share losses period the net from income million half a same at per $X.X second from down in XXXX for We look earnings of Now $X.XX first or operational XXXX. of $X.X $X.XX,

last a in of last first adjusted same of the high same this $X.X expenses period was quarter year. or profit $X.X this or same second approximately decline the with net continuing and quarter, quarter $X.X for compared in margin profit for income was quarter per the in costing. improved gallon the gross in diluted $X share prime million $X.X Adjusted lag the lower year million EBITDA was X.X XX% $XX.X year. same in to compared this XX.X% by half to or Gross quarter or key the XX.X% profit margin quarter million profit in profit the of first a with first the last million in from administrative million income EBITDA last or the $X.X and prime million sales was operations impact the net was decline inventory this $X.X period at in and drivers of second X.X were for to of year. $XX.X level, due $X.X partially to million costs million a second of quarter million half in the Looking million which year. profit and XX.X% first At gross results negative in year the million first with and gross quarter compares million from the period smaller year. offset million and $X.X Southampton, $X.X quarter the compared XXXX. feedstock million the of in margin last second period with $X.XX EBITDA for the XX% the operations XX.X% in of $X.X the our compared share, half first margin continuing diluted for General for year, margins, $X.XX the quarter -- or Gross product products was $XX.X of comparing at million second Adjusted was in per compared gross second first the

For Interest second compared compared in same the the approximately in first last quarter million for $X.X $X.X the the million to second year. half, expense were G&A expenses period million quarter $XX.X year. was million last $XX.X with

the compared benefit is same result lower statement tax compared tax for last laws with the approximately that a to of Note a and million carryback half $X.X expense interest This net first half we the allows was million reduction, income of due X-year to recorded in combined of the is losses year. the other for tax due provision interest last and changes. to primarily on income in half same $X.X security Act. tax expense deferral period this First million first The with -- was operating a law The period year. for CARES from million to benefits social interest $X.X year debt laws year there the of that continued as for changes rates. $X.X reduction payments, this our

rate we half tax expect be XX%. about to the year, For second this of effective our

last Specialty let EBITDA year. in million XX.X in million business first million year you to quarter through volumes the and with walk year. petrochemicals. million XX.X this specialty operations in $X last $X.X gallons this in me for compares were compared the second the starting from in second second of gallons, million in and $XX.X quarter Now Petrochemicals first quarter quarter million to quarter petrochemicals the was of Adjusted second XX.X continuing segments, quarter our specialty and the the gallons

last volumes the -- first X.X specialty to of gallons were months compared For period volume million XX% same approximately down X or petrochemicals XXXX, the year.

in Let's the quarter gallons the sales to is Prime was gallons talk first million key second year. of our profitability product in gallons a second products. about XX.X and driver in XX.X XX.X prime million last which volume, quarter the quarter million compared of

Prime same The in XX% of feedstock of XXXX significantly natural period formula earnings quarter our period a posted to costs QX, expansion Recall in natural in prices improved X.X on customers a in price to business products from quarter. into well last to million the gallon. per was $X.XX is sales first or of $X.X to inventory from in costs. Sales a the were the second producers. year. in million compared million to the compared the as website. deck our portfolio months feedstock $X negative sands lower Margins in the margin $X.XX a prices gallon For our trend approximately Slide feedstock for effect market impact the this $X.X XX% declined quarter. cost at that sales $X.XX Canadian the costing. shown quarter, Late gasoline per to bottomed quarter due volume lower lag in the of million product improvement down effect year lag In were prime or roughly gallons X ago. the to weaker markets feedstock natural from approximately quarter demand started decline first the inventory is July, average was XXXX, to to stood in both and prime pricing oil non quarter throughout X gasoline on decline from benefited as out prices due Benchmark increase. feedstock consumption July's of The approximately impact per of second first due other same higher gasoline gasoline first quarter. also end-use negative as sharp volumes down natural of the second polyethylene feedstock product the generally that gallon had and

the advanced first sales Now gallons reformer in of volume and X.X declined due primarily Byproduct million second $X.XX in moving quarter approximately million the in negative year. Byproduct in in gallons was prime and the per lower X.X on gallon Byproduct gallons to declined sales. production quarter to about the was to take to minimum first. to inability the second byproducts. million product compared prices last upgrade for margins, of X.X The result capability quarter margin per full advantage decline second threshold from as the $X.XX product rates the lower by gallon combined benzene the of being its a to sharp driven in production prices byproduct the of due product below required with the unit operation. sales

wax Specialty progress as and XX% uncertainty maintain but -- in second operations last demand and million last to the year. COVID-XX no approximately compared customers, the to had million from significant on in year. our with quarter, the on quarter feed second generated maturities, revenues, quarter XX% move Let's or in $X.X second from increased to XXXX, million There quarter on cost decreased EBITDA from XX% of continuing debt Waxes product were due supply, the the Specialty construction ample quarter. Wax cash $X.X and due million The Waxes and downturn, in In have quarter first second of management. of second million we on in period this wax material million especially of which in wax million during nearly Processing were volumes QX, $X.X from were balance the the decline Revenue the decrease second economic furniture pandemic. approximately the our year. $X.X impact to a depressed $X.X million adjusted our of million in the we or million to year. $X.X from first pandemic. focus the quarter. had sales revenues decreased in X.X million from markets near-term quarter automotive $X.X in second up we sales segment no the $XX.X a of Many approximately through X.X liquidity, Specialty Waxes. pounds the keen however, a of $X.X of customers Wrapping the last end second $X business second included sales QX quarter from strong and last decrease of the disruptions sales sheet,

open we'd for people's line to Now -- questions. operator, like for the your

Operator

from Sarkis [Operator Instructions] of Our Sherbetchyan first question line from the comes B. Riley.

Unidentified Analyst

is This in for I'm actually Aman. jumping Sarkis.

So given my your are in first XQ question what for is, feedstock of expectations prices? margins XQ volatility the and

Pat Quarles

Yes.

in being as our the get in through as quarter. costing third in the briefly mentioned in that I effects as market inventory bottoming And feedstocks flushes we we the a our as So with through inventory, tailwind June. see remarks

in So Frankly, into be be margin north we as that the we the third gross of had should as pretty get about in quarter, get have we just the we candid. to second quarter, XX.X% fourth quarter.

remains Our what's with watching COVID. through. visibility and all murky. further And just We're may very out the headlines how going play that on

remains getting the demand to I end. year, it June have the a back, mark shouldn't into just don't I really see is unfolds. seen that this reason third very why but really to get We've we market So continue as encouraged to how quarter. going stronger into later have the we've as we'll starting been the by how any year question and as in bounce mentioned, that

Unidentified Analyst

aromatics, And saw July you to quarter? in how is waxes when and looking and customers' Understandable. demand chemical the what relative products, in August trending in prime at orders processing second

Pat Quarles

Yes.

way was in of that during of I every bit basically The coming customers characterize we kind weak. May, kind of news. is was from negative news May it So had

continue increment down. we to So

X with rubber North rubber, that on opposite. butyl the in We've about -- good crude. of broad in I anticipated, there subsequently started side. EPS It where of for some actually come had it's in second last of we quarter a variety big units a polyethylene than call. demand North America actually and and then end of -- the in was we kind globally seen lower drives users, goods which in the time disadvantaged based noted, actually exact particularly period fall kind demand really in the durables since in Really, been We've the back. Production talked seen time, a and As automotive America, were the we polyethylene. because

that Now well. reversed situation has as

uses So we're really all up. tick begin end seeing to

were others, they than mostly in how weak strongly more Some reflecting May.

we As these see a softness normally, August, get into in of markets. lot you'd

actually think return run production through seeing of August. the I we're

what automotive be late in think the I period. during the guys, for instance, quiet their normally would they they doing summer, did

So that in and strong, levels. July demand August, see even remains step-up pretty products. That's the actually driver and June from a really we prime the for nice currently

I think applications goes to I like our that we of in and wax business similar story. as furniture mean, wax a durables somewhat is into have exposure automotive well.

seeing those as resumption second the and the were we in we wax So soft August. get now of are into quarter, orders

also. right in So that's going the direction

a I on given not versus in-house we going think utilize on primarily production. will that processing, custom processing it's weaker some bit to the are custom because our customers slower of little climb margin, be back,

early for processing. of a TC So us get opportunities side we've a as that's a it going new this long year, is, seen we've to drive That's slow, lot as of mentioned through second and activity custom growth lined talked sale the What's reengaged to the half about the I on out think, market, growth encouraging cycle. the when ramp I of year. we in bit the operations revenue our of project we at

committed a benefit of year. -- half we don't in new I'm scheduled as those we'll nice of successful And revenue second a trials have with customers be projects, getting on of then and the year. anticipate from exit number as But significant projects these actually I to And year. this the expect we'll many them. the more continue we'll we driving optimistic we that start see step-up So

Unidentified Analyst

evolving you your byproduct XXXX? the second byproducts quarter? of second the And what half how And were in margins Okay. margins for anticipate do

Pat Quarles

make in energy the been will before, in going And volatility speak going structurally I as U.S. all long export aromatics second, some but on to has to that, we've as usually second with a demand Sami quarter comments of early sector. in some back. It's pricing saw in return prices so styrene on benzene a leveraged, really So and if gallon. what EPS, else comes you benzene the for reflective toluene. We seen that turned saw of will, byproducts. numbers to generally on all trading so a we benzene the pricing, short and We're discussed were below kind things the actually the the market of have We U.S. as in is like from as well $X Asia. fall result benzene our reversed. growth benzene That far We demand instance, in been has

a benzene gone has on in again. seen benzene exacerbated production kind that So There And respond. benzine the have we've short of the U.S. been problem. constraints of result, that U.S. some as further pricing

benzene I August settled at So gallon. $X.XX price, per believe,

over we its And that So second the it's as year. half would lows. XX% from the market continue of to the what see on up should we continue suggest in

very saw turn early negative in you second in the see margins, here third that particularly as quarter, byproducts, quarter. our the in we'll but So

Sami Ahmad

Yes.

terms the In asked. you margins, numbers byproduct had of for

to Pat first to in aromatics $X.XX it prices. which $X.XX -- per gallon, the of in on the side, and described was that gallon a that byproduct in quarter, was what quarter. So compares depressed our factors own the terms negative the in the going on, positive addition per second And then

able that threshold production quarter, mainly the for minimum the during operation advanced below rates unit, fully run also, We were for the our unit. was AIRMAX what were reformer not to unit, because needed

we achieve level whereby aromatics the unit, Now run of concentration. another don't don't the why is reformer important? Well, that we run we advanced unit

-- of byproducts. good in benzene stuff, So high amount the toluene the and the the those

byproducts. unit it is and product the reliability, and AIRMAX further it is running depresses wasn't for that up -- The So demand just to rate. pricing was again, due

Unidentified Analyst

AMAK sale third shares me. of of the for the of the question confident in the What last by then completing quarter? And the it. makes end Got remaining team

Pat Quarles

Yes.

week we be -- What talked about, all recent think in as received interpreted funds ago. us. seeing I are reflects got is most -- this a the we should buyers behind really the sale we've the which issues and that regulatory that So now

in I that are by And hitting levels. really us extending fundamental above been the new prior close think and mine the seen we're disruptions the We've gold high, to will or we've the and continued mine actually of got COVID And is successful dramatically the that their all-time of all second advance were life. value for watching, we've are copper. in very got actually the gold guys apprising the metal mine. the On associated to these course, year. behind And most the impacted year-over-year you here prices well. with of mine be as to up look for an the at recover mine basis, then production has half starting prices

we We've So end of had indicates closings price buyers be further all quarter. smaller value was as close. of that get the we'll the think to the by the see that the to me come negotiated. SAR complete of the end and quarter, one that I in And XX just at anticipate buyers the and we

Operator

the Capital. Tieton Our Bill Instructions] next Dezellem from line of question from [Operator comes

Bill Dezellem

And delayed the sale it like the way? are have has. delays through of what I out to those you talk been roadblocks of last believe on that are? why to has clarity don't why up actually those now on which the that I'd degree follow Would question. I kind

Pat Quarles

Sure.

by was the bodies, driven loans regulatory hurdles -- of not from mine. first government has getting the is least delay we the So into which of guaranteed really SIDF who approval probably had

we we extend rolled to And At carries transactions first and agreed knowing were this how which of So to then travel to was long year. of we middle not into going period, -- last is and receive do of crisis immediately approval, us kind had last. the of which to XX kind we until all this What frankly, shut year. September extension, quarter this that receive of to down. negotiate the that COVID didn't then, the and government

and So with that's long date. complete stop the that is amendment they That buyers, until agreed currently or close. to date have the the

the that we and they of -- deposits. to March, of XX% their for saw prior close end So extension, they didn't lost if

So outside their buyers had March. But was what end Saudi. funds at not. really were of the who positioned ARMICO, to closing the close other already able you saw were for They of

think about September the what are you XX if for close, earlier. the until close or no they responsibilities at them have obligations for buyers point, this really, to to there's So incentive

So this to get we September to XX. were pleased in prior money

think responsibility obligation that is I to -- prior more but really XX, some going we're we'll this come see in September their and to at point.

Bill Dezellem

That's helpful, pretax taxes then rate. but Pat. And you you a showing up ended loss, also tax that's negative had a $XXX,XXX of

idea whole paying So can the through pretax talk with you taxes of a loss?

Sami Ahmad

Yes.

return for or were So Non also -- related. noncash were when to of return differences what's a book -- you look there $X.X is they to million return at the second accrual quarter, not shown reasons. clearly range there

the we CARES will those in the half, of taxpayer. With that come our cash monetize second all IRS NOLs, be able NOLs, the from expecting the exhaustion to a recall to on Act, under of we've the we're been and proceeds

-- balance made the of example, July, $X year, the in the tax -- we estimated So in million for should payments effective for to our of be XX%. book back book rate

Bill Dezellem

the you you estimated on $X the of an us million, is on half? planning meaningful in the outside implication tax that And if second should profits you so to are payment made --

Sami Ahmad

anymore. been monetized. the tax because have On don't NOLs we yes, the basis, They've

Bill Dezellem

to does basis? how GAAP Right. reporting relate that And

Sami Ahmad

NOLs? the -- of the mean monetization I

Bill Dezellem

would not with the reporting? No, tax you basis is and on profit GAAP a that correlation a be said or to there what degree

Sami Ahmad

Right.

they they estimate to take year. way guidelines, according that So how advisers tax the that's IRS annualize they And our the tax the quarter it payments. work -- for is and first they

any again, the then, see will they the taxable the then So third quarter will and the during more expectation quarter income, performance terms in in -- if our third And what results quarter and based in it on took quarter quarter, payments required. third are annualize there they of that. to it first they second revisit revisit

Pat Quarles

our means earnings. reflect looking. that as second It's an to on doesn't half estimate really backwards So it part

Bill Dezellem

Right.

to then slower, opportunity lastly, whether with an have prospective any the of the created disruption a opportunity an virus because way? lining Okay. chemical if for a just something to evaluated reduction that volumes. and they trying to significant different to and work Great. there their there. in you And see in and compositions customers all -- sort Did that how I'm with there's that share the were was were here find the they that reevaluate you create crisis and business to they silver to

Pat Quarles

were Sure. the base kind these of kind this my that and -- quarter of Well, up we security Similar and it so means from the we through products renegotiate takeaway of greater what see flow value. the products, didn't our what the kind of was our several the near-term as market the at a forward successful us on to you demand past. of think I think will brought good of listen, asking going during But to some that dynamics Actually, kind of value and second contracts some on reevaluation business through forth. we were go drivers down values I industry. prime is, with during quarter going from

able we customers. to see sacrifice security we're but certain didn't of a and in some get values, with of So growth cases, extend,

weathered product the business think well. very value the has and I of the So storm structure prime

as processing the mentioned and capital assets excess opportunistic a XX projects lot that the frankly, several the company we the that as I we this we're think remarks, that wave capacity. -- We I plan my to years ago during had given capacity have, driving. we custom have prepared look

pause people Some been a as the took slowed quarter. during have down these of

We reengage of some have actually companies on these seen now projects.

look for themselves satisfied are the of kind have people again, positioned we've been starting projects Chemical, they're continued forward, to the think now to on growth Pasadena I storm. new projects kind on weather good there. asset we've working having And that engagement Trecora the of against that against to

engagement So sites. I've been by bring really and encouraged revenue for both to the really more by to market continued new opportunities the

coming negative But took people breath. out of probably we during nothing little So a that. lost of quarter bit the time a as really

the new but to to for as of is of kind don't it. bit, going us? something Maybe happen think question this piece improved creating opportunities result dramatically I I suggest of next really a a want is, is your

forward. going I is are their everyone maybe the always better how use looks be think of utilized not processing whether of versus our assets assets, And assets at going or to kind custom theirs.

are We yet but something to enough not we'll some conversations, suggest coming from having see of those it. advanced they're

Operator

Henning, comes from Our Kurt the next Inc. from Carl Caramanidis of question M. line

Kurt Caramanidis

half million I'm EBITDA the should did in million figure out the last of year do You in kind about run, mean those first pick what $XX what half trying of the first that? in in year. improvements Or what's I how are? -- of know number EBITDA you look using we we out annual to be $XX something to and run. at this of between do run, you there? projects rate medium -- long I baseline kind a improvement rate a should And figure have of short run we

Pat Quarles

these right, Sure. Well, as we leverage uses. a kind in leverage end of talking lot of operating core have -- downstream demand to been we've about,

as and probably our effectively that's is underlying of as product in the this fluctuation on a I margin of X/X contracts from fixed margin formula And tend perspective you it dramatic and So from sustainable prime think the driven profitability based. year, -- are solid. know, last they're to as first quarter. of course,

demand as we'll returns, we get benefit so of doing, the anticipate And that. which it

opportunities. -- all of performance in our enter of growth and we've new Waxes what few new driving both the TC, as Because view well. cost Specialty opportunities segment. chemical markets that We're indicative from to we for are those working well asset reduction identified pretty year's would on instances, program as have TC, or we case And as the actually contributing anticipate South I utilization. progress products would I be our both then last our pandemic. recovery Hampton South get So And once well. continue is should in more processing And to touch the Hampton custom a to performance baseline

against pre-COVID -- if Hampton of is it -- representation South kind of would we I the -- performance we're return kind I last aligned if think demand to So can the a a year's levels, of put baseline. fair the you on if

Kurt Caramanidis

had you up another for or Are in the with of load kind Great. smaller And end to XX what's square apparently have people X? amount. AMAK many the there buyers how a This have person of to by that September. come Or down there?

Pat Quarles

X. It's a X X, shares AMAK, of is portion of And the the itself, back. company buying they're their

Operator

Henning, Carl comes the M Our from Harenburg line Inc. next Tom from question of

Tom Harenburg

financial progress statements with making I'm you're cutting at your and debt. on impressed down the

from can the for this the year. the dragging up concerned, completed there we the on as not is this far a prices that record is made, hitting silver by substantially, end levels. if Copper get are XX% probably any when of September? was gold As agreement mine is up Are penalties probably

Pat Quarles

Great question, Tom.

listen, our have yes, right? to the that by we're the right I preserve option is then that not they end in the the event of close the future, those the running not So think close to quarter, in be we So do calculus shares. would

than the -- I earlier, no their sets mine earnings, for ago they sooner mine their is years X posted with have first not IPO coming the as years I new will improving, which in, X.X and but an just CEO guess, up be positive after them posting mentioned earnings. As now, operationally,

means they early as that So have they And what could IPO towards year. next working that. an as is are

It's they -- shares our them go on when been they the not then preferred after and holding alternative go monetizing our always some case. So public. has at point to

it's continues on value clear, mine to the it's monetizing close. shares cash. downside not moving of these and were to is to be with a improve. our But and the that we arguable big that you not I as want And focus Our But on the say, priorities strategy.

Sami Ahmad

cash the out. we to want exit We and want Yes.

point other project the that the going what The up I quarter? in they recall to start would make said, to is fourth Guyan Pat are

Pat Quarles

yes. half, Second

Sami Ahmad

help up. process prices whenever half, should starts And are, gold given their Second sometime. IPO where them in that that

Pat Quarles

why closed. -- hear thing why that's this that's I'm me why and you Tom, frankly, And confident you hear on my we'll get very changing tone

think We I value the mine. the in it watch. we that metrics from see they see

be to be I think they're going interested going moving in we're in and on. interested closing, to

Tom Harenburg

this and this been $X.XX disappointment with George investor found Jack an and a to Having Crichton, the with together, the who Rucker ultimately to off at basically back got company out. it share. and lot sure put there's And in turned line Peak way is spun XXXX looking Preston in of this a be

I XXXX done. I can if back they going a get we've were think So I this -- heard, have offering. not, in think, hope just to that that thing And you public

dragged has awful for here. that an So and on on long time

Pat Quarles

Yes.

you the years. know, over kind mine operated how well, As of the has been

long operating operations coming. quarter. brought they best, yes, until tremendous after their made the Savas as in it's to Savas then happy do own contracted Savas CEO. them wish took on look third having They've in we start to us has it but than a their see of rather think themselves. And Sahin certainly well. as and control forward progress. also progress, made moving kind time I'm they improvements making we it out. Only I team Hired his benefited actually And of the but

Operator

back I the further over to this Quarles closing to showing turn like would At questions. call remarks. for Pat no time, I'm

Pat Quarles

Trecora taken duties. thank sites on protocols working our the to and these safety change, at Thank a that for close to on in and everyone, our lot I to Many team of to from onset instituted home our remain began challenges, the the diligence you and from questions, it thank you, their and At participating appreciate come off. those on sites want our your those been interest that, their been for by how and our their facilities really everyone again, want people protect of virus. both I Thank I'll with proud call I'm our the we'll And the and operator. safety we people. that of of new I for at while their thanking today. continuing the It's of and hasn't sign commitment. easy. has organization pandemic,

Operator

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

now may You disconnect.

Trecora Resources (TREC) 8 Aug 202020 Q2 Earnings call transcript