The Chemours Company (CC) 12 Feb 212020 Q4 Earnings call transcript

Ladies and gentlemen, thank you for standing by and welcome to The Chemours Company Fourth Quarter and Full Year 2020 Earnings Conference 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] I would now like to hand the conference over to your first speaker today, Jonathan Lock, Vice President, Corporate Development and Investor Relations. Please go ahead, Mr. Lock.

Executive to earnings Company's today Operating conference Vergnano, and welcome full quarter by Officer; and Senior Financial President XXXX Newman, Officer. Senior year call. Chief and and morning, Sameer The and Vice fourth Chemours and Mark Vice Ralhan, Good President Mark President Chief Chief Officer; I'm joined

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

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

true full of year I'll how was everyone political time X. at team on determination our families, the unity COVID-XX the we to events us. communities of stayed solid another From was have full you that in put the ahead The Through fabric our We we that take year the entire reminder this thank to like continue. Team people commitment taken customers was XXXX which the determined in the end, their at team must challenge Jonathan morning. I people our justice resilience and Thank results polarization In our with for and year remarks joining to reflective and Chemours in to this to the Chemours social moment each thank of tore chart every operate. meet us time again their the we on and rose very with I'd reminded forge focused display for company threw of as to challenge we on over XXXX and of north; delivered of and efforts safety energy my same resolve you, as society. XXXX strong begin all, just a of are. it that last the of the this purpose. of Chemours.

response Looking the our XXXX, company. for the tone back on early COVID-XX set

strong Stabilization and three cash success From AVA with focusing balance putting liquidity say me heard strategy expansion to and XXXX. certainly Ti-Pure areas; a customers and acted a speed first; two, our The dividends contracts can our exceptionally I and focused the executed our few generation throughout perspective, of of which Ti-Pure the on we you've urgency Flex communities employees build new portal. paid and the last sheet with key on three, continued year. we we commercial say As the Value here in one, team on maintaining calls, on and position;

in significant QX, innovative expanded to Chemours will for After QX customers. create also our in models we long-term build continues entry into believe business with Opteon a deliver and value. value source saw to which into bottoming the We portfolio which aftermarket, our we continued chemistry mobile of QX. the be momentum

year we notably, most cash the full million $XXX reflect the of flow financial free recovery Our delivered. our of strength results

cash free million flow reduce in and year included XXXX by our $XXX $XXX CapEx cost the to This full by actions Our million than was response the for executing to million pandemic. in XXXX. higher $XXX

We in debt some debt, advantage balance took refinance further our of markets capital also to of our sheet. conditions favorable extending our and maturities the strengthening

same on the a our account financial to We arrangement flexibility. strong continue be legal in cost-sharing resolution and announced an and the which case, of to contributed dispute potential the with PFAS MDL the XX maintain litigation, the settlement XX and that time million future this $XX by Chemours. X-K legacy $XX to appeal MOU. of ex liabilities. release press with liquidity the January manage we of the establishment and of Ohio, More we year, January DuPont escrow used support remains from contain recently on Abbot Corteva PFOA and The settlement binding including details announced At the million

view time, reduction as providing risk we that significant Chemours protection and I shareholders. for at agreement As this said

TSS is we fourth Finally, quarter the behind the details covers Specialized two Performance our cover Thermal the going segment new of to Solutions announced Fluoroproducts Advanced & results. Materials into and he or segments: APM. or split reportable the have resegmentation business Mark when Newman

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Mark. Thanks

the in drop Fayetteville the the remediation year-over-year with a EBITDA was adjusted was early $XXX fourth work This incurred basis. of full launched XXXX impacted to to X. margins litigation legacy our all markets. our share million, in end were in result XX% at adjusted relatively cost demand, site. GAAP across and respectively. net delivered and per sales results. EPS Despite chart $X.XX performance to COVID-XX with were year The solid demand late which billion, partially activities macroeconomic Full EPS by expenses second XXXX, strong at initiative We holding line savings segments on and global $X Turning and a a half $XXX related quarter as million was in $X.XX year share weighted recovery. per offset flat

benefit program anticipate Looking the and business in to ahead, cost XXXX we beyond. this continue to

expect cost XXXX $XXX to to that deferrals basis. projects. million of from XX% structural $XXX million will benefit in We declined growth ongoing convert us XXXX, on savings in CapEx an due to to XXXX the roughly largely of savings

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cash on focus the generation the to year. continue We throughout business

atypical on for result time quarter. an to results cash controls, QX fourth $XXX demand was basis quarter drivers the XXXX. $XX steady on lower for is this flow in on great million close quarter seasonality Fourth CapEx since In year recovery improved spin-off. given prior in the slightly and on of of best of and EPS free Both the was year-over-year quarter, I'll sequential cash flat the million to a basis working this rose adjusted a year's revenue strength X%, to businesses now as solid the and improved net move pricing by the the The basis. $XXX holding with cost of the volumes discipline a combination to reflecting and the was Sequential of third held capital quarter result. which Margins from billion income momentum Turning first X. the EBITDA were our rose last we XX% up, Free on from quarter, chart part total, third in and quarter This $X.X quarter. in year-over-year key essentially into the flow million. year cover demonstrated a to the achieving businesses. momentum and

first of the share. Board dividends continues deliver and stable per note, our February quarter approved and shareholders, Chemours COVID-XX of record the strength generation is prior potential. testament quarter Directors XXXX a payable to pandemic, As our as businesses, XXXX. worst sheet $X.XX the the XX, will to even to be balance through the cash This consistent to of a final of unchanged and dividend from of of shareholders portions

chart Turning to X.

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turn liquidity. to X, I'll where cover chart Let's

calls, strong. the in last few said I've remains liquidity balance and sheet As our

of balance increase million, shareholders $XX $X.X million. was end $XXX while to at was QX million. cash $XX an XXXX. million was XXXX $XXX just cash of Our Operating the billion, flow CapEx Dividends from were over

interest bonds of roughly on we X.XXX% disclosed, our $XXX refinancing versus bonds million fourth completed the XXXX we new approximately on the previously million rate with quarter bonds. during XXXX We of using and balance is bonds. X.XXX% million The As new refinanced cash. bonds the US issuance dollar of sheet $XXX $XXX the a older XXXX of

a costs. billion was we of leverage maturity in the able As the result net $X.X ended $X principal net tower, billion of interest of reduce XXXX debt. amount were with Debt and our gross annual a resulting X.Xx. extend We cash trading approximately to lower

recovery the the provide We I'll well on balance the talk be split Mark? to positioned continues. as Newman, and to a and over from color our Operating business results. sheet continue Chief Mark perspective Officer turn that With to more recent liquidity things segment about

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Let's Thermal on Specialized starting Solutions this & talk about chart.

advance the As and are becoming more globalization support industrialization safety comfort health to of ability critical. refrigeration and

the category deliver substantial returns The most friendly portfolio in modern investment of robust Specialized Freon. with our continued stationary air have to even into environmentally for blockbuster differentiation mobile business behind refrigerant Thermal solutions. the cash IP this some years XXXXs enabled supporting enables today leadership strong that for refrigeration in refrigerants extend and time. XXXXs chain. cold the some and to come. late Opteon Our We category marketplace cooling our is powers us Solutions our combination invented and & low-GWP supply And with patents the Opteon advanced sector over the and of The conditioning,

business to cash the believe we is well shareholders. continue returns result positioned to a As for generate significant

Progress Looking ahead, evolving fast centers computer hotter. to from getting smaller are data faster means drive. we things devices mobile to and therefore cars

As a and result cooling for thermal needs world innovative the management. solutions

and confident segment high-growth potential our on sustainable tremendous unlock Alisha's wide platform range segment. Our across value of is emerging new a am and will markets. the under full of solutions TSS focused through TSS leadership, that end Opteon achieve developing we I the

most consists Performance to Chart of Advanced Let's of high-performance XX applications and turn essential new to in specifications demanding our enable performance our portfolio Materials even life segment which The polymers. higher. and which modern continue drive material demands

have forward respective polymers products of highest properties. range and performance I performance potential chemical broad of unlock with portfolio into unmatched a where friction demand in current are notably, brands thermal specified APM the cells PEM economy building and ceiling, from of our at recovery, A envelope automotive and management, to core to and and increase Denise in in Most and unique in figurative in hydrogen time. our our support dielectric the to Our We from to solutions to the Krytox categories end working powering through fail. uses infrastructure. energy materials is aerospace chemistry segment. semiconductor their Viton fuel expertise the Teflon literal structural improve to only provide growth believe number of will high-end course chemical Nafion and electrification, enable other while with of APM the markets electrolyzers. our fits this unique membrane from in renewable lubrication, investing the to look stability,

segment the results start XX. Now Chart on moving which to

in The Demand and with segment across and the all Titanium second sequential lows. from of year in regions the rebounded markets Technologies Our supply year-over-year a COVID-XX-related the and momentum on well in volumes the QX. year-end. the level XXXX, AVA end on quarter was and volume EBITDA responded into prior year chain resulting margins volume. and new X% sharp our And to early increasing share versus net sales our in rose account contracts have relatively pricing and year increased distribution. build team TVS execute XX% across declines at operations year-over-year with increased growing against basis. a channels adjusted of despite of our flat the through rising Pigment continued certain and EBITDA from both adjusted Fourth respectively year. basis XX% delivering flex the strategy XX% the continued XXXX in year, to throughout to Full prices stable half

XX% portfolio. breadth the the recovery on sequential and More adjusted product basis. geographies XX% unseasonably reflecting the across lines were increased importantly, across EBITDA net of strong rose all a and Volumes sales

continue more to in and much ahead, QX expect QX. season coating recovery the Looking ahead XXXX a into we with normal

strength for the realize be existing us the We key of are our of COVID-XX continues to and cautiously customer contracts. TVS with without a predictable Flex given of gives and we benefit new a commitments major proposition and most and customers of sourcing continue ongoing customers source course pioneered of is AVA our with markets. unique believe the operating customers. pandemic which value benefits across us to price. reliable long-term differentiation

We the with both will continue have in to share to leverage consistent channels goals. made gain our these we gains

some cost inflation a industry. are we across chains from as adjust our supply Finally perspective, anticipating

could the continue across they believe the transient to in do year, opportunity margin we temper we segment. in are improvement this regain While nature these share as

Moving to Chart XX.

lower Specialized normal was due resumed, to softer look more conditions. in significant top auto the gains reflecting as down patterns of year recovered Adjusted market points demand Despite business. our net in first Christi X% offset on had returning given million relationship Thermal XXXX contractual was full XXX production OEMs. pressure EBITDA to we from year adjusted X many Solutions price line Tier QX a operations our primarily basis $XXX TSS to XXXX, early pandemic by across with margins actions our shutdowns Automotive as EBITDA stationary sales. $X.X from for and or reflecting year demand helped and Corpus productivity the XX% volumes the downs our in basis it. gains call cost plant headwind, impact productivity a Price XX% on billion full We QX, sales actually were headwinds. QX. rose and & related as with full at Demand have XXXX a COVID-XX

auto investing expand the stationary to the We're As continues in in additional growth behind aftermarket in also blends. presence we look XXXX. ahead, earlier announced as business we Opteon's

We regulations enforcement recently passed in the In should drive Act AIM time. enhanced for stationary though drive have see to continue XXXX additional the the to blends, US, wake of volumes are we of as down over Europe down evidence HFCs F-Gas a in quota turn. the of yet step phased sustained Opteon's

We climate Opteon refrigerants our to do well to positioned and of share portfolio combat customers change. part help low-GWP continue are their to believe our capture

down our Full was price Turning now on full geographies. end segment. basis down basis a headwind. declines Adjusted to again chart across nearly year from a markets for while Materials EBITDA levels. relatively million small XXXX sales $X.X reflecting X% billion, all year margins Volumes XX the Advanced XX% resulted in were demand XX% to COVID-XX a year-over-year on $XXX APM of of and net XXXX were cover or Performance business

of end to QX net of Looking on Volume basis by of portfolio. our sequentially improved The QX the XXXX, in markets. did margins and top focused sales pace from while XXX growth, expanded performance, be basis a recovery on the and will continues XX% at most all see rebound recovery execute geographies the business the APM XXXX. $XXX productivity the early year parts improving QX here the driving performance and cost build million. started as team the And continuing Denise in of solid line sequential across In from trough. a from points we improved to actions most and on her across QX to

pandemic, with were recovery from we believe are the potential impacted markets our we margin by the ahead. of end to expansion well many strongly positioned significant While APM benefit

were sales and portfolio COVID-XX-related Solutions compared and changes. Moving QX. lines to XX. Customer million, for ahead year shutdowns QX Solutions Mining XXXX reflecting product our on demand chart down extending our mine issues into Full $XXX XX% starting Chemical core segment to in reduced

$XX to offset began sales in Full December volumes year in highest was performance weaker EBITDA with QX However, licensing in in improve XXXX. million quarters. as adjusted to technology prior the QX strong sales helped

full improvement to solutions XXXX from mining year our XX%, points on result, XXX an strong leveraging would to XXXX a were of in XXXX. into will glycolic cover starting strong momentum acid. I look As fourth for basis chart guidance its demand The global extend performance XX. and margins business like quarter continuing

a Starting we continues global While economy an strength built exit the non-synchronized stresses. the to we global adjusted we our believe build a represents ongoing our chain and billion EBITDA the recovery at billion XXXX $X expect outlook this $X.XX midpoint, has context XXXX, been of At to pandemic the of between as supply the in in with over of several and generate top, results. XXXX. improvement XX%

as some CapEx restarted later projecting of approximately are $XXX million, are of year. this projects deferred from XXXX the We

a targeting to cash hold and of COVID of relief returning to million cash than includes dividend are $XXX million, deferrals, we free As shareholders result, discipline majority of flow approximately the share which the flow to programs. program we repurchase XXXX of true our disbursements our continue in through greater $XX free

chart prior with the composition next color of XXXX. the bit CapEx years, consistent our On we're more providing and on a for

be we million, run and steady have to the For at million enterprise said and around million can the for depending the year, between upcoming and $XXX run the maintain vary we past $XXX on capital fleet. turnaround in as maintain across schedules our expect $XXX

anticipate to million programs growth we for in of XXXX. drive the of $XXX maximizing want anticipate million investments, to portfolio efficiency to in IRR focused will from you sustainability lessons things of company. most while long-term all that, the I'll These value strategic programs are the and our in the highest we and XXXX, great the they CapEx XXXX. well the frugality and in that We in cost For growth growth earnings and some million our continues XXXX, the target. apply remainder organization the $XX served which I businesses. learned bringing are Mark. over of back With capital we Regulatory that of the substantial deferred back assure turn us up approximately investing make portfolio $XX on

Thanks, Mark.

Turning last to the chart.

with and set a to integrity more we vision, performance leaner codified only customer-centered, ambitions in focused that which foundations rapidly As and we close on been like with creating the ensure to XXXX take fit-for-purpose simplicity, showcase our step chemistry different moment collective would chemistry change of of live the focused take the five-year cost safety the spirit a that on a our transformation unshakable that of values, in. we back Chemours. Starting we've kind I'd holistic to of delights of power our rewards transformation live a could build obsession remarks, a out been Not we on. plan and journey refreshing here the did to at a portfolio, from behaviors more company, the our a on to and these world company excellence. view we've a that Since five-point and and investors business structure, customers entrepreneurship, execute structure culture fits we the spin,

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investors. have agreement that. to for our just month always we looking opportunities with been just DuPont Corteva and Finally, The for does you we last Chemours derisk struck

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[Operator you. BMO Thank from Capital Instructions] comes McNulty from go question John Your morning this Please first Markets. ahead.

that? about can you be kind pricing starting regard and on to How morning. the at this that like a with the Yeah. expect Thanks looks and end we capture? taking for industry and guess of question both in to you congratulations we're really should equally Good my to how enter TiOX us I strong to important year. on When think up-cycle point, participate volume help the about think you to about thinking

John, Yeah, question. great

As that quarter, right. nice segment, this every you're seeing a at go think region every We're have I -- continue beginning year. growth. significant uplift. Fourth into of we saw the look as We're we seeing we

everyone number to participate year capacity of been to in to that our share very beginning to the clear end back growth. this we of XXXX. one, the by So, want going We've we're get

goal. our that's So

of in us that continue to terms standpoint. will move So along you see

time. for We're the AVA where the same contracts will us positive. play see our that's at into and volume getting that we So very coming more people

we inside that are giving the confidence us the every to gives have there gives portion that's us some opportunity, portal customers. still the have well. we is there those From based Flex adjustments portal, of is price we volume, terms opportunity stability standpoint, of be obviously, going on of in a Flex price. some price because us said, as as basis The So our adjustments but significant AVA producer to really price AVA that remember, obviously give our to be move day. the contracts, which the to could on made But the biggest agreements ability in indexes.

moving In that price, move and fact, stream we steady on is right a now. that continually up

So side I opportunity price and side. the on think on to we the have participate both the volume

Got go ahead. sorry, it, -- and that's

just our have Mark, in distributor we capability add both I channel. and pricing Flex in may

price agreements, as long-term take the So we customers of significant Mark's to do which have our do ability our AVA volume. portion we of enjoy to But a point, on protections well.

as the follow-up guess it. then, Got business. Fair the I enough, And thanks on and Fluoro a color. for

a thanks right of because though out to it margins side, about breaking the guess Advanced the right middle lighter definitely way. obviously, it's for the little time about thinking in what than bit of getting were. First they helps Materials us But a to be even odd thought at in two kind looking -- divisions, all, I it's now the the it like, Performance time snapshot think it it's we are that snapshot. and an

potential to thinking business? for more we're should that leverage in should about can volumes guess like, And be the about of that operating you back margin I the to normalized speak how we we when So, think business? kind where

right. then I'll to let you're Sure, me start give bit more detail. John. to Mark over and But a hand you Maybe there, little it

So years you really operations, year, past been business. sitting Sparks Dignam, see working that and Denise points inside is who really the that over been margins the has on getting have we're running X.X cost our Ed that business right the now. leading

but going drive variable our hydrogen of that from we've margin in demand tremendous idea are the beyond XG will the of well also move to going have existing And we economy we that, talked the Demand are lift demand. really about demand standpoint. So up. leverage as the a business, the going fuel those push that's to cells to be work even further some as membrane and this margins take as

back high-teens run And we end they business. this be EBITDA at in at of when time, the where the margin had that's -- we business this volumes. So, anticipate margin should look was by if of year that higher in rate a you

this. do us point be Now that to business we've that the leverage give taken inside cost to down able to

need want don't by year, ridiculous I you be that And So, the don't a That's additional end add kind if we'd the get volume, runway. volume of know you anything? we we additional believe at Mark, to need why there. of but to

color Yeah. operating we in in running this as to Mark and is the business. is focus business lot that into would Mark's business the the costs our the impact probably the the see thing that for on is segment key to But was structural only a margins of you'll cash year Denise way add the other affected give I -- given work there. And disproportionately reliability that of improvements on the recovery, which operating to point, leverage. is

on So see stronger we you as will and get top line that hold cost. the line reflected

reflected that be as we this for should in a is improved we striving high-teens And see something year as margins. You'll said, Mark think point. starting

Thanks color. it. very Got for the much

You’re welcome.

Your next Please from Advisors. Alembic question comes from Global ahead. go Hassan Ahmed

at cost XXXX. as morning pressures wanted to talked you Mark about you look some Mark. Good dioxide titanium Look guys revisit again.

sort And of sort obviously pricing price As I of evolving. for role other been ores, that about look take some the of it, variety a of and momentum a of side commodities. at are in shipping spot be a on there's lot costs increment seems a there of a for costs seems higher higher it variety playing to those talk overpricing how of sort

And parse you those costs? to do components, of two love you those So, out I'd may about some of could cost you sort if thinking what are those in guys guys how offset XXXX?

capital down we're lot side doing lot really went this cost is you the year of be of TT work on a at Yes. drive on if if the using that that, to our CapEx of driven the side off TT to and we're cost. underneath going look A spend you the

So, whether whether the it's are at that use Chemours is capability broader lower-grade investments the mine to to -- expand lot us where our allow ore going. Florida ore to mines or portfolio Florida, our Georgia a of that's of across the our

within year. to need -- we but a So, most ore already cost segment. for contracted to not ore just operate is really we're on From doing perspective, an of lower the ongoing ongoing that year this be focused what point our TT very at

be So, effect not on us. that's to an going

is follows if usually is hypothesis think prices, pigment so pigment I right that up. ore move prices your

that's hypothesis have with around effect have of already to our a we advantages player Being effective side. standpoint. a ore And from shipping that I of to think point see lines And standpoint. year to try place something you a large But of us have as a be that us time dealing that's could minimal be the that possible we the through over efficient in going come the and give up. product that we're as of contracting that. you cost shipping because prices that many in we then of some around all from view, from of terms again think I in

have we So, -- hand that think contemplated we're of pretty our well standpoint something that that and inside in from guidance. I we've

Obviously, look gain And of are Very follow-up trying you sort some as dioxide market demand I where XXXX. for a unique TiOX as in of titanium guys at numbers touched have the there sort you of you clear. Very I'm is course clear. big volumes. guys a of can estimates a you XXXX. on for understand through sort situation What share take out globally, growth to consultant

XXX Meaning demand X% XXXX? XXX, will I'm could how of beyond situated market basis call terms is of the above grow the mean are could growth potentially obviously Sort in above in kit? guys points the figure growing you think TiOX growth pie whatever out to market grow for you that growth X%, and you demand year-on-year. that trying grow. like market about how will grow just we the should way I market how it

Yes.

we're regain take therefore as in clearly the year. disproportionate growth today experiencing high-grade which an dynamic to to tighter So, we share see Hassan share opportunity this into pigment a a of and market go we

certainly year. that's And that to double-digit even So, the potentially forward. translate as to how lower we could moving part full growth of look we're

So, mid a year certainly market that. robust about the growth is it that's above be we be is, should you yes, should the thinking way or high and single-digit

good. Very

And to Don't maybe add forget to have that. one thing we last capacity.

our to contracts grows with structured capacity the -- AVA customers. remember volume our have the if don't our have the we we meet And market way needs. commitments the are So,

commitments share market with them. have We

And them. the as market so we with grows, grow

to grow have beyond said, the as we So, Mark capacity market the growth. the and ability

much. you Perfect. Thank so

go question from comes Goldman next Please Bob from ahead. Your Koort Sachs.

morning. Thank you. Good

Hey, Bob.

into I little think, potential. John to maybe asked was I it, deeper wanted weak. a but margins the little were guess surprised I still margin that APM a I dive

the TSS up which mid-teens, argued. you you peak was get maybe think high low said, XXs. At maybe to I XXs, thought last you

get on cadence So to when for so or us we sense get think to has if $XXX the much to ceiling there? conditions back could can is about were of to the those so that EBITDA gotten isn't million recovery because the give Opteon path it new And industry back TSS a some fluoro, you and $XXX what plant significantly better be the that combined of higher? same million you

out. enhanced Bob, at Opteon is playing line, you margin a look of product as what Opteon continued when the the plant Yes. obviously, TSS, the again, and growth is

that the more from margin we So the corporate enhances Opteon, more really our there. the volume facility, run can

And standpoint. trying by not high the hydrogen, taking believe we run membranes to go in growth the end probably teens is into from of then, that the and XX-month side, which to cells think idea that get kind of we're a and we fuel could rate into that's to year. drive we account XG areas really these APM other volume the XX the even that around On of an

fairly feel we So confident.

played period. so, that you was high at during fluoro we one of yes, combine don't very businesses. had that, time. a HFC And out things of inside price high A when probably combined peak point And very of those, a that the forget, lot during

the to but of, HFC see But and drive That's to one works. see as to to you're less -- drive are probably on going not those, good in, over have more the and you're forward. going you're to on But have that that the continue Opteon going to quota have put kind going we So that's going side. just really going really, the you're see to on prices side, it HFC. you to comes way

size margin the before. you go continued had both these to you're get So improvement not on able to we extreme we to of might that going be But forward. as see

the That's ask could I it looks but what's helpful. it's And happened in progresses, not echo it definitive on AIM looks to -- how it Act, guess, I Europe.

in XX-year of Europe? same like So you've for there the America, And an step-downs? seen sort system would you three-year quota opportunity North path see is a Thanks. in

AIM And legislated, that goes in works. Act been the way it. It's have -- thing so be That's place real just the usually we to clear, now absolutely. is Yes, it now.

now when a of is, place, the quota that they EPA in when in of well getting past, where the Now the setting the happen. step-downs our base there we're very by in takes put the EPA as it So place. puts right? and the a system has in rulemaking in the rulemaking doing in with that midst And And sliding quota-based terms as happens. they're much now. level the voice this will scale been Obviously,

very something is be that positive this us. will So for

you. Thank Great.

Sure.

from from comes Please go Spector UBS. Your question Josh next ahead.

the Thanks for taking question. Yes. Hey, guys.

and agreement couple DuPont that a on Just you PFAS the Corteva. have with

now, the wondering cost and that address I'm free and So the on flows based you if of the million half the year, flow the of place escrow that, that be that in what part And ongoing agreement EBITDA your include $XXX heritage does flow, had sharing cash related free to through? last would this with liabilities. that is, for million, that impact share payment cash you year? guidance how also on $XXX

Sameer. this Hey, Josh, is

question. address just Let the me first

or PFAS, look -- segment the in our just set, the environmental all you legacy are it Other legal remediation disclosures. right, Corporate and to If in be costs, the level

over to million. should the see going free $XX million million if historically, impact is the sharing. probably we flow a divide PFAS activity and to But year-over-year the $XX on legacy impact years, on the should more you how impact just one impact point to $XX level average, I cost been benefit of about XXXX, cost, legal kind EBITDA in And The has roughly want the five be look agreement, a sharing given last you So, XX-XX from the the just the But at two. have spend -- than to cash of cost you from the legal PFAS out into to a the the the thing range. COVID-XX that's side. think that,

these a environmental out the side, adjusted of majority EBITDA. adjusted costs of are On actually

very So minimal benefit there. story see It's flow EBITDA. cash a really free you don't the to a adjusted

project's relative get line shared, So, on what project-based. to as depends are on impact cash history, on that going the the cost gets to flow, the the spent see but out. to really you're and free year-on-year, money very an going projects that's It

see. question cash be won't that that million. earnings $XXX regarding to back going your but or any adjusted impact EBITDA the payment. flow to does $XXX the million And include -- going you're $XXX So guidance million not

Which is free of not though? part flow cash

flow. It free cash part is of Yeah. not the

And of intermediate segments? the kind kind it, any which Okay. That's in difference segment presentation? now fluorocarbon you a that transferring makes with trying question to Thanks. that earnings out, And just allocation, on you how curious I'm those there split that is in has separate upstream the the of are a across piece of assets? Fluoro economic impact helpful. I'm products, figure just the of the terms

think I'll Mark let -- ahead. go I

of HF was supply manufacturer facility. at the Yes. going I chain to the say, is Porte TSS our just with segment where La the starts

in into so, all is value HF transferred for at applications. cost fluoropolymes fluorspar and refrigerant to upstream chain of converting our TSS downstream the of And business the and starts the

That's Thanks. helpful.

You're welcome.

Arun Your RBC next ahead. Markets. Please from from question Viswanathan Capital go comes

Good Great. Thanks. morning.

Good morning.

consultants many forecasting price any by a maybe TiOX, in just and you volume, as X% Do segment. in the some guidance of higher? per recovery the the What sharp maybe out you XXXX. Appreciate I import pretty ask progress side are segments? the the are to parse further led I kind with fluoro on to two driving increases. congrats that guess on fluorochemicals you also EBITDA similarly And growth and ton the bit detail expect of could the on well expecting XX% automotive getting recovery illegal but a by little then maybe guidance through wanted on

the element you it there back is that, appears Maybe Is breakouts just talk guidance? on any it range. through of can just So, conservatism some half-weighted? of that in your

works. to as great prudent COVID-XX we of Yeah, work how its cautious around impact world, see talked it's about at see and the stage as And as in -- participate to and be work strategy year obviously we through our the growth how contracts ability on think this we strong we're we good markets. go-to-market to and that our earlier, question. industry we based our above Clearly, we on our growth, TiOX. capacity, And work how thinking the available

our to clearly, at around, at current wanted I auto various see like Fluoro And be year. side. that As On recovered look semiconductor some flag, some volume of in that's RXX impacted this also is we certainly TSS the be There of of the are growth are shortage. I the questions segment businesses, view by in much our will volume we this the how on of losses our will HFC market. looking we're chip roll-off products how year. seeing somewhat the But some

a effect have So in we transition there.

our on that's good we the that's seeing recover into polymers APM -- there. so full been And the of year. based the the slowest where And chain. in we're to calculus then the end part came on TS of business business, of as But year, sit supply growth on we the

year guide, our at at be look improvement in we as segments in year. the and probably APM terms we say leverage and year-over-year the would that's of I best full TiOX how operating so will And our full look

of in all midpoint last that a in consider versus or $X.XX that's back year $XXX at billion calculus that we about that deferred the the of last improvement year-over-year million that's our about guide. look million year that's costs you of of when $XXX And the some the so EBITDA. of our you the guide, If absorbs numbers part

point where early across to think encouraged cautious we year signals our supply demand the we're seeing at by of it's prudent given chain and great some seeing of businesses and we're given are year. COVID the that this in in the we're We that. be all very So stresses

Great. it Thanks that. over. for I’ll

from Fischer Duffy from comes ahead. question next Your Please go Barclays.

fellows. morning, Good

Duffy. Hi,

all, fluoro. of First around

can fourth in part baseline? the the price Europe, specifically maybe more your down that part What the just imports out, mix? the much you've built that that of does little of then quarter. a XXXX about was natural was So view And that was And illegal What do in step-down in how in talk your volume? reductions particularly with was of year-over-year? X% to auto will overall versus parse bit that you what what

reductions price that Clearly we're think question in some a we're down blend terms helpful. market the as step-down that's some we on Duffy, To blends what as I'd say need side mix in is saw seeing. that the as the around it the in contractual shoots relates regulations more we price your effective how customer mix of the And well of in work. Yeah. green today. seeing F-Gas they quarter, Europe certainly to we

We -- regard. see expect are to throughout all over we that. we've said And as should we this we traction that previously, some start that year, in

of overall in regulations market too view would early the probably signals I blends yet. positive general, say is of in effectiveness our to we're the So of enforcement just call terms seeing but some

Okay. one one. then And just housekeeping

when what of it are to And give think, us we I as is us with segments. two only One new historical history you years as And you annual? that? correct? gave far is saw quarterly should that expect if I planning the data two

Sameer?

the data for segments that the will see we three that a file in -- the one Duffy, Yeah. segments. on XX-K you'll for four three-year

you Okay, great. guys. Thank

Thanks, Duffy.

from comes Andrews go next Please from Our question Morgan ahead. Stanley. Vincent

is understood want talking you understand I thinking could volume versus planning step-up that benefit you're that how help in make going offset you. it? the just everyone. XXXX. back. on significant XXXX, should such unit about Good some unit you're or just modest the there's getting XXXX this to in Titanium the cost costs morning, us modest flattish maybe that section sure to cost Thank And we that modeling we step-up cost But presumably be from should I in be fully about

Yes.

while And some we in -- operating flagging are I the of see Just to on be we in that leverage business. inflationary significant inputs. an Vincent. are this environment clear, we

call, the said contractual earlier have input. in Mark As around we commitments significant

a And business. So in we expecting segment. mid-XXs year EBITDA we certainly be of back sort margin wouldn't the is, the throughout view to our should improvement overshadow in that be the EBITDA this to

helpful. follow-up, CapEx could the the is is but to bridge I very And year-over-year? That's up. free help a Okay. the you us EBITDA flow going see obviously just then up, just cash as be

like you you anticipate back? So how Thank But bridge what coming are And is much anticipating sounds on year-over-year? do the legal It cash is capital with free below you. doing flow? in what working your issue line. this that else going

Yes.

start certainly add can So and there Sameer I'll additional color. maybe

use that million is you the $XXX some $XXX the a and $XX deferred on million. the Clearly, guide capital. then we're in million starting year you of paying of are about participating that that revenue working back If COVID this the look the payments about add of recovers of and is at your we point upside market in as we

Our we sit million. we as don't productivity, there expectation have intent capital is could we any that capital. clearly comments. And -- $XXX improvements continue as today. on certainly working will to be focus try working other through But that's relatively Sameer, we beyond the if the flat I be upside know you here to make

points. clarify it. different Yes. the in offered Mark geographies. just payment are all Mark are The of format I you Vince, quick But talked about, COVID-XX that these that to programs just two hit want the

to any disclosed of to that conversion that into the will business the flow 'XX, that's are we'll deferred mean tied XX-K. get think I at you we kind in about would And million which is the right? XX%. the it's in of cash $XXX make the in Most north other free these not these being taxes cash are that to So It XX-K our ground I $XX cash of going see. today. and flow, you Again even well you of to cost the disclose kind XXXX, tax say, point are you you'll back that look later payments a free I pushed out. as in be wanted when see a form will just free flow million of conversion, all of

it. think you flow So into cash as conversion of cash would think kind our I free you free the about about you as of flow ground back kind

all it. That’s helpful. you. Thank very Appreciate

back now Q&A the Vergnano today's concludes I to turn his Mark like comments. would it portion to for of This And call. final

everyone today. Carol. you, joining listen thanks And Thank for us

we ended. probably happy We're can voices, way you the we're even year As hear the more starting very and where XXXX going think quarter optimistic go. fourth the way our very is to we're with from is happy of

So thank successful company about as just really very, you who all done to can where But it as XXXX take of where employees they very to we have we our could really make excited everything this and the are of are prospects XXXX. was.

for for again Take participation. thanks And your your again, the of care. So always company. support thanks as

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

now disconnect. You may