The Chemours Company (CC) 2 Aug 242024 Q2 Earnings call transcript

Good morning. My name is Regina, and I will be your conference operator today. I would like to welcome everyone to The Chemours' Company's Second Quarter 2024 Results Conference Call. [Operator Instructions] I would like to remind everyone that this conference call is being recorded.

to President conference Chemours. of like Brandon over now Vice Ontjes, Investor would hand call the to I Relations for

may conference. begin You the

Quarter Officer, I'm everybody. Earnings Chief Dignam, Executive morning, Welcome our The and Company's Good Chief and Financial to Chemours' President Conference Hostetter. today joined Second Call. Officer; by Shane Denise Chemours XXXX

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

During our the call, our to to in release Also, we company's measures are refer the non-GAAP and course financial last performance. posted to adjustments issued believe useful the evaluating press terms investors we included of reconciliation certain earnings that of are presentation our non-GAAP A website yesterday. we'll evening.

that, will over With turn to call Denise the I Dignam.

Thank you, Brandon, and thank joining us. you, everyone, for

having experience excited as leadership executive Senior I'm morning, XX Chief our to new the [ of to by begin and Officer. of team. new introduce as like served of function, ]. call of Quaker I'd brings Before Financial Chemical we CFO into our this the over President finance our get welcoming a Shane years previously Vice member Shane our to Hostetter

been with he's for While already having Shane month, a positive impact. has a only us

with board that happy brings leadership strong on talent are to have he solidifying Shane our the team. We

like Matt will of for effort served to Chemours, and Matt position role leadership critical previous within continue would Matt transition, sincere Officer. team. within Abbott, who and keeping my stability in I time CFO, during returning as continuity key for our tremendous been interim in express a his his finance leadership a this our gratitude to Chief During to Enterprise company. has our Transformation his

this discussion discussion about of the who we the and our Shane, morning, hand third over I In overall over I'll faced conclude performance to outlook the talk our business our overcome. will by for recent Then quarter. will our some sharing performance. and I'll financial go challenges

to your We will then session address close questions. Q&A the a call with

quarter, along the in tremendous dedicated away, we first the challenges, In shy to with people, quarter face controlling our performance. our as didn't we uncertainties, putting of faced could we the second Consistent control team what continued collaboration focus driving and the forth and resiliency many business that our demonstrated course. of leadership

foundation plain a the the As are are partnership, integrity, work. are are formula were renewed with are a reflecting values set did the of These across leadership from organization. culture, that team Chemours' face as values with so inputs these developed of we we who core our and of key believe. They part for ownership and company a They respect. long-term we Safety, spoken every what in success. simple, how of we our aspect present and challenges,

the due dioxide drought faced at in production region. you titanium to As disruption our severe we Altamira, are recently a aware, in site our a Mexico

support and an We formed our amazed ongoing I for need. people water, team. assessment and to they quickly way was had sudden it that conducted a in the business needs to live. pronounced In was food potable the those partnered we shift in provide other impacts for our the meet determined personal people basic planning. implication, also was those supply cross-functional organize response, where best customer essential at communities needs demand. business While and to to worked Together, how drought of extreme promptly very This through impacted. scenario quickly team our we to a substantial

at we site of duration our of actions with met clear highly These with employees team of TiOX a around working downtime and was and reliable commitment this. collaboration uncertain, optimizing the our our to reflection regularly as upheld production we by require our the plans a our TiOX diligently We our take The TT supplier, our the customers circuit. ownership. reputation to ensure are clock a deep in pride and sense believe agility

our that we these fast through increase volume customers employees, quarter. partners and the not exceed without first action, hard of possible the the expectations community It with excellent and were to was volume TT This our our region. able efforts previous collaboration work was in our and from a XX% simply

team. our thank I this, For

anticipate this later. outage of more production onetime for the third also results TT about which will our We quarter, I incurred unexpected Because about this of will explain disruption we talk outlook second quarter, our during costs. we $X affect million when in the

the price difficulties, reached $XXX team million with quarter, the to in in TT execute By we to cost prioritize plan, with in our declines. savings second approximately TT to and our offsetting transformation XXXX. year, continues these $XXX savings targeting compared customers Even relationships have the end prior our million strategic of

the For to with we considering that our the third year, strong commenced savings quarter plan transformation than anticipate last in less our we comparative of continuing year-over-year make progress against first middle of the year. the half, slightly the plan, rest

seasonal demand to Now let's talk about experience TSS, continue TSS. pattern. In a we

the a in was hemisphere, up. slower warmed coating quickly season it the has there northern start Although to

this elevated excess by inventory. market summer the still affected HFC with season, even is However,

for low TSS' we quarter potential Opteon refrigerant refrigerants, refrigerants, separate refrigerants. this reflecting X discuss product our updated and break our Freon warming to our we results reporting from sales As sales have global our offering to categories.

total double-digit growth This adoption, high effects production shows EU refrigerants importation and quarterly effect. have that gone see Act and sales XX% they've while growth For warming sequentially the since strong of refrigerants the sales. reflecting continue the quarter, U.S. both year-over-year, of into AIM of progressively and potential Opteon regulations second lowered refrigerant our the global F-Gas to approaching

to sales and rest Our Freon the Freon season. were of levels inventory by inventory inventory attribute double-digit decline flat HFC build through volumes the levels to were from further higher-than-expected first these the year-over-year levels the by refrigerants Weaker second HFC with driven the continue slower will elevated for that ] regulatory the lower these quarter in in to the pre-AIM [ under generally quarter, softer due start refrigerant downs. cooling volumes market market we compounded year. pricing, primarily to elevated We U.S., believe remain and HFC inventory a step

its of to Act AIM observing adherence continued of further and restrict Commerce's we as and To work importation U.S. Border through refrigerant. regulatory duties strict to phase the illegal enforcement concerning ongoing U.S. the U.S. underscore evidenced of are activities are the down, mitigate efforts Department Patrol regulation. enacts the These and circumvention Customs

line top see portfolio, the macro and we Materials APM, At growth portfolio, double-digit the Solutions APM's Performance Advanced continued expectations. line with in recovery with both in across sequential

in Our as with line corporate were expectations generally expenses well.

on performance, with us focused our various second quarter values. grounded in remained remaining the while team provides complex core dynamics, business While has the business

of want our to Before recent to team recognize couple accomplishments. I highlighting I a hand business the call by over Shane,

to undertaking PFA of expand at received manufacturing This we significant was our production First, recently in Teflon site our Chemours the Works West permit team. resin Virginia. Washington a for

chips. U.S.-based customers only on of supplier we with ability to which as us will I material, to as critical, see the for of our later. more Our semiconductor secure the rely Teflon was is PFA speak essential a fabrication permit this opportunities the

outlines for progress corporate report, towards seventh responsibility meeting And our goals. annual which second, released in Chemours' Progress, we June, commitment our sustainability Partnering XXXX

we in the Our commitment unwavering, reducing progress as in achieve investing exceeding sustainability in products continue communities operate. more and innovating significant and to reflected meeting where is manufacturing we our responsible to sustainable commitments, well make is emissions, to and the to that as

our SBTi, our target targets Specific to the near-term Scope emissions initiatives, to by by cut gas to X X sustainability proud our approval science-based initiative I'm greenhouse the of XX%. highlight and

per X science calculations underlying plans, This approval and by make and to XXXX. and guide let our emissions continue actions Chemours climate engagement review In including we process methodologies. close fight required the a inform thorough our target XX% between The by SBTi, production to long a of new as impact addition XX-month to global of change. Scope ton to our in reflects rigorous by reduce emissions against meaningful commitment SBTi a

I'd financial through walk hand to to to it Shane now results. like over our

and you, everyone. Thank good Denise, morning,

the help with impressed commitment In shareholders. Chemours, people, forward join First very to with strategic and move as unified and success direction goals the eager more and I for early to Chemours all am my of foremost, our been value I'm I've time our our new to CFO. to create our excited

I Chemours long-term successful say ensure our of I'm of performance executed. our along because resilient that expertise are drive proud its vast my its industry-leading portfolio of of our operational to and is will that being initiatives. portfolio, I'm with its growth people, aligned confident delivery culture. what chemicals, the joined expectations industry-leading the with

our into financial Moving results.

a X%, of billion, sales impacts sales X% in increase the X% partially X% largely driven volumes. second decline net quarter offset year-over-year. down consolidated for was were were which portfolio This by pricing $X.X lower Our of approximately were which by and

EBITDA offset TT consolidated on quarter. with Our benefits, impacts. focus $XXX cyclical year absorption for ongoing was impacts. million in partially mitigating prior and pricing, the our by Freon by million TT $XXX and cost production This current from headwinds strategically transformation were currency decline plan decreased adjusted enhancing earnings These which lower the align to driven

$X the anticipate a the quarter. associated the Second same quarter amount amount million also third plan. TT this related EBITDA in item costs transformation with We adjusted third-party unallocated to includes to approximate

adjusted to net $X.XX compared million the prior Our was the current prior current the net $XXX quarter in quarter million compared year. in was our year. in per consolidated $X.XX the adjusted share And to diluted in income income $XX

increase in aligned by Our in the remaining compared expectations. internal these corporate to Committee's in associated to the In the This Audit corporate and costs costs quarter, prior second implementation addressing expenses internal reporting our with in expenses million quarter, costs. from financial largely were primarily $XX the recommendations over of million $XX additional due review. million corporate which year controls our driven approximated in expenses, litigation increase material the $XX was with weaknesses the total, with

business X% and were million. impact partially second decline net to from offset our year-over-year by X% the This segment starting $XXX In X% decrease to in volumes. price with was by sales which increase in Turning a a exchange, a decreased TT. performance, quarter, driven foreign primarily TT's X%

due site the in the manufacturing the unplanned extreme Mexico to downtime our Despite at Altamira, region. drought

Our Asia compared This volumes still to expectations. year. largely ahead demand was due to of North the America robust grew and in Pacific prior

adjusted $XX as currency experienced costs but quarter and segment's EBITDA at margin declines continues the to from mentioned the was its second as XX%. offset to TT pricing local year, is TT's plan, which well compared transformation million prior remained expectations. X% by execution While reduced earlier I TT's outpacing adjusted partially that flat decreased EBITDA impacts, this the the strong

sequentially. sequential basis, our exchange XX%, each downtime we foreign volumes, pose a a headwind the mentioned headwinds which to by TT's a a X% the and increased On XX% result Altamira pricing before. TT's strong impacts sales faced in was due net I by given rise driven

to our now TSS Moving segment.

sales net a increase X% For pricing sales decrease prior approximately decline the lower the offset from in by TSS' net of a driven quarter, This $XXX which volumes. partially by was in was second were year. X% million, X%,

driven builds levels our cooling As Propellants our And shared we to a slower earlier, TSS' which HFC a extent, pre-AIM Foam, was Other elevated prior inventory to was to as portfolio, lesser excess well the influenced lower refrigerants start pricing inventory by and did experience XXXX Freon by portfolio. in decrease in pricing as season. from

growth was continued Other fueled TSS' propellant transition well volume in stationary growth and was by Opteon as our automotive portfolio, portfolio. as complemented aftermarket. Propellants was Foam, the by Also, which in robust Opteon adoption in our volume demand driven refrigerants by our

regulatory XX%. quarter, This In additional $XXX a quota increased to second the driven secure adjusted was lower costs EBITDA connection allowances EPA's in in million, resulting margin fixed refrigerants technology ruling primarily of in in due the near-term reduced by decreased absorption the cost the to adjusted HFC and lower TSS' to year-over-year States Freon with production decline XX% our EU. transitions and in EBITDA connection pricing, U.S. lower downs with demand step United

well volumes, partially and was in demand increase as the which in seasonal TSS' trends a XX% increase stronger by sequentially. in XX%, by propellant Foam, a On a The volumes sequential decline offset refrigerants basis, sales pricing. driven rose net in Other portfolio as by reflects in X% Propellants

influenced APM. to current currency prior X%, down of price quarter, to million This due volume and as in the primarily prior as compared the across sales economically well mix by reflected for decreases The shifts product which Advanced to in turning $XXX Now in year. decline Materials soft the APM portfolio decline was X%, was the respectively. were dynamics Solutions to Net price, within and X% Materials end markets. APM's concentrated in year. was sensitive was which Advanced XX% demand weaker the decline Performance market volume portfolio the compared in portfolio,

driven to primarily million the by other adjusted which income. also decreased the pricing, EBITDA percentage margin, year. points X of which $XX These currency EBITDA from decline decrease impacts impacted additional APM's adjusted and in lower The a second quarter, XX%. was APM prior to compared marks achieved items significant

EBITDA APM's a company's increased in rise Sequentially, million, the modest sensitive volumes a adjusted currency a were pricing in economically segment was other had in and across of current end which sales markets by the X% driven XX%, sales net by driven $X Separately, but portfolio. quarter. by largely and net the respectively, APM's X% $XX a higher decline slightly XX% in million by recovery headwind. tempered volumes, and

our Turning and now liquidity. balance to sheet

in approximately unrestricted and consolidated liquidity, cash As $X.X was in equivalents our capacity. million includes million of revolver we debt and which XXXX, $XXX June $XXX $X XX, cash in billion gross have and billion,

increased leverage in to net ratio second X.Xx Our the quarter.

we on elevated our not in leverage quarter. cycle, ratio due during and remains did we compliance market revolver net our While the to our draw the remain with covenants,

$XXX same company quarter flow was the operating quarter of more which than The of year. second in used $XXX the XXXX, cash million million last

reflective release became cash effective the XXXX maintained was no higher the company's in which Water due cash this to Fund, interest contribution anticipated, to interest. usage of $XXX the and settlement we fund. including equivalents, in As company was reversionary May cash the million its The of where in restricted Settlement longer XXXX, District the

Also, in dividends second $XX with shareholders by projects the being the company quarter distributed the $XX line overall company payment on The million million XXXX, capital to the compared year, spent difference with in quarter. prior in driven of expectations generally in $XX spending in its timing. the in million to

capabilities, some half cash inventory equivalents will We timely at will further creating our our confident the for remain and capital anticipate of we cash and liquidity we on current flow our focus inflows reduce similar well the our second level unrestricted we in rest Overall, as a cash work the sheet working year. are as to We in customers. payments which with balance future as capacity. assist from project

any ahead not concerns look to banking anticipate with we our covenants. liquidity do XXXX, would As the we that impact compliance of rest

take focused and sustainability driving our consistent allocation, our on with highlight remain goals, a value. values as I key to priorities to we capital moment Related shareholder wanted to

First, we to in initiatives enhance focused portfolio. pursue growth will our investments

Second, are profile. committed improving our we to leverage

on legal our Third, provide environmental in to we our the accrued company important, be finally, equally best quarterly and and/or contingent will interest our terms of to dividends. stakeholders. through will basis we and responsibly and And shareholders the cash resolve liabilities deemed

of of remediation to items. the update Form of as I our Item though we provided Separately, to highlight have our an material in a disclosure want X couple weaknesses, XX-Q,

master ethics to implemented respect over to to period whether effectively. of cash During controls to we complaints. test file of we are the controls operating vendor time sufficient prevent to these the enhancements verification Also, and unauthorized evaluate completed changes significant modification remediation. These with and require the continue second their resources disbursements. processes procedures we of towards quarter, to timely managing dedicate committed the enhancements efforts Overall, remain a our and

recoveries of by solid double-digit solid this our To am execution saw providing were to plan. several conclude, Opteon strong in encouraged against growth had APM TSS demand not in aspects have And and transformation year-over-year. results momentum. while the what business are I we macro wanted. continues performance. TT quarter's

initiatives, to right this With foundational on top our approach on growth focus confident am create strategy sustainability I the of shareholder value. our that foundation is

Denise, back over you. to

Thank you, Shane.

be to a On EBITDA next to quarters, high consolidated a anticipated digits. decline ahead sequential recent look quarter. into with are sales the quarter, down a view consolidated Consistent quarter. the we providing mid-single-digit Let's upcoming expect with single third a we to of in net basis, the adjusted low continuing

in site pricing offsets continued APM. sales Our modest the paired partial Freon in downtime from and seasonality forecast with Altamira, impact Mexico, at reflects recovery refrigerant TSS TT unplanned our of weaker a in

quarter, adoption For assumptions APM's sales double-digit of Opteon and third showing year-over-year Solutions strong strong these year-over-year growth. continued anticipate portfolio projecting growth, the the Performance refrigerants,

haven't while believe Had TT, third we second experienced we quarter prior demand severe be as the broad due our downtime TiOX drought third remained major quarter. a In to the in recovery, catalysts seen indicating the we to the will sales stable we year. quarter in Altamira, enter not flat the

for do the that EBITDA to onetime $XX between extend in the we $XX quarter. expect also with adjusted to third million range associated not anticipate Altamira the third are the costs beyond production million the quarter. downtime TT, of impact expected Considering We downtime and

weaknesses review. in from reporting spending demonstrable and the anticipate of sequential choices third and in of as controls adoption internal the financial We corporate remediation thoughtful a Committee's on internal the reduction material recommendations we make quarter the Audit we make progress over in expenses as on our other

grow. what costs out and As value: our half reiterate these our for significant to that where leveraging in believe businesses innovation well in as corporate in TT into are drive our operational XXXX, want APM, to overhead; our to shareholder our and priorities success, opportunities and two, we have across We done edge take Chemours' of priorities my future functional have the on building we I we invest as second businesses. advantage one, move to essential expertise

innovation. Leaning our advantages into in

in One and of these driving opportunities and focused artificial which markets intelligence us Both of have is investment is front growth in TSS Performance advancement this businesses. space, in portfolios high-performance the in refrigerant the APM Solution key in supporting our our computing. Opteon

effective liquid XPXX, my cooling. hardware in quarter, of in is mentioned Last the center solution being ]. cooled alternative air liquid advantages Opteon cooling Opteon more [ fluid chip believe both remarks, We for to With XPXX cool direct X-phase to new prepared data use outperforms than an I immersion a that means single-phase technology. and cooling innovative

Syska cost options. a savings, XPXX Opteon benefits: the in that recent up which data which for was clear of climates. Hennessy, tangible deliver These cost most benefits evidenced needed and participated space compared the XPXX cooling to that to study the XX%, center with showed solution immersion cooling eliminating Liquid approximately cooling and had the lowest to we consumption ownership Stack facilities water by Opteon XX% enabling potential immersion savings cooling in total provides other reduce energy in nearly of

had a of advantage cost next Opteon cooling XPXX over best up alternatives. to liquid XX% the

liquid the plan XPXX by Opteon of continue opportunity the participate meaningfully center market. cooling in see an and this We overall as to launch data to mid-XXXX,

focused appropriate in we want commercialization, regulatory progress the life product markets meets on to ensuring our that and the is safe registration for requirements we serve. cycle use remain that throughout we As its towards

manufacturers server hyperscalers, We and for who effectively see as XPXX server Opteon cooling essential the with chip solution process hardware. and an qualification chip are in efficiently key

intelligence in time intensive to take in that and be These as future forward progress complete. GPU are energy sources, periods look chips nature. hardware We artificial to more high-performance instrumental Specifically, in providing periods. computing updates we supporting which will qualification

in semiconductor segment for enabled enabling high-performance PFA Our Performance portfolio U.S. the a computing manufacturing, expanded opportunity critical resin, the which APM market is has Teflon Solutions U.S. our and Chips with our the Science also in Act. by material

manufacturer, complete resin. not resin chain secure PFA domestic a PFA grain supply is Teflon U.S.-based only semiconductor without the high our As

flow is infrastructure absolute an to out through other in manufacturing delivery is well resin production. the uptime and PFA needed it words, ultra-clean fab wafer used safe as advanced Teflon chip the semiconductor of In and Teflon enables meters the our contamination to chip ensure reliability fab filtration as that chips. from handling. and of requirement It's systems fluid to avoid process. environments PFA high-purity high-yield production for helps

focus investing growth our on for this To in area. emphasize

been obtained As our expansion a for production recently our for priority Teflon newly over this site acknowledge received the want earlier, and Virginia. I the we West permit who Works to chain. the hard leadership at throughout in has team manufacturing finished PFA support our strong mentioned project our we Washington to key Chemours and year, worked APM those team last complete I the value on This

we continues will being out forward operations, to product prospects in the Teflon serve about Our by long-term market to PFA. for We're customers excited growth early we PFA to and able anticipate be September. our sold this commence look which starting and Teflon

a we in passionate contributing advances developments few just and Chemours, driving Solutions in shareholder These driving advancements are the At innovation, value refrigerants growth. to APM's are Opteon computing. specifically of are artificial TSS' and that portfolios Performance high-performance through about innovative intelligence

fundamentals It pursuing core and to closing, we building thank make our disciplined highlighted quarter, people want that costs exit of out continue investing X,XXX customers to commitment operational Chemours who challenging and solidifying employees upon capital the executing a excellence. business, I our continuing to of the In build to business dedicated reflects growth, allocation for we values for by our upon their is management while that we are, I with culture that our and team, earlier. corporate team global strong a drive

open the We to will take line questions. your now

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

to the role. you. with Look Shane, congratulations working on forward

kind have putting I question Obviously, real of business. terms we're some the the going guess, to of of of pre-stocking is conviction know, some on think drag now TSS sounds -- had to us end can profitability business. I pricing year. the and you destock, end the I you inflection help like at clearly little don't coming? in the the how Freon to some that on understand -- I ahead pressure point a of I better a the the guess, inventory, bit dealing of that guess, the and around this with it about

we're addition I in you to it that, maybe for then pretty buy just sell And this ended to the follow-up And been allocation -- used time be, seeing we've guess up and past, extra to was cost actually to a a there in would your question yet around, allocations. having Chemours you.

So I guess, can that you help us what to understand magnitude the that was? dynamic of and actually

sure. the Yes, for questions. John, for Thanks,

yes, that inventories in First end. are of all, you and said, are step we depressed is are are a downs the at asked seeing to -- quota this with have and you confidence we pricing significantly going HFC level, do that -- we high

are that downs occurring, happening. that step that quota occurring, definitely be see the will With we

dramatically have it's that that RXX. part in don't happening Europe. as of see also absolutely we're And experience We it's with market, with you so a seeing but our in Europe, smaller

driving is It's part we mechanism. no down want also really us strategy our to Opteon double-digit growth. We're And double-digit working. I to growth, The And we've price about sequential really growth really what of back year-over-year and is. deterioration. had phase had our and the bring

when already downs said you a when have about we've that to we've; pricing auto in think OEMs. -- right, comes So step that, we it always

think I you statement. impact like other of coming segments which is the a So big aftermarket, really see automotive stationery can in and

this is of it is would your and a a We part, is a around technology this the and other always just say bought said. year. also quote this-year past. why is This year delay I was sell, by buy, year, you as transition -- we caused really We And we different. So quote have question in the issue.

it So actually the have when really is a HFCs. the plan -- seeing flipped you we're stronger. actually tremendous And demand of X every But our growth, because was actually for still Opteon, to can we're been for coming units for X every would -- unit seeing there into that unit of Opteon, you about think need you of growth while is what year, still that Freon.

So impact. massive it's a

we're quarter, again, bought really this So in technology the year. second tied and to we transition. this and market we'll in customer it's the order believe in in in the demand, we to meet be that the But doing out delay future in quota

it. Got

Okay. No, just And that's to over TiOX shift we can helpful. platform. the then maybe

of around took overall Altamira, lot than like Altamira maybe noise actually of bit obviously, you but little equation, -- does seem markets did if it TiOX the better actually are a So out the expected. a you

the over us in XX months? next next months help out look So to regions. over, about the the months, guess, you over I right we seeing coatings for in should tariffs guess to can you how how can speak next given again, that I think potential the markets think progress and market now just as they certain you that XX see XX you market what you're playing be improving out

we could the third we now, bottom I 'XX. I in here. definitely demand. believe sold quarter, we what Sure. of have would stable sold is would Yes. -- I And We sales third -- have actually, say did right going into we mean similar the And as the could see we quarter see is more.

and the a for as We have consumers potential in that's real confidence Fed confidence rate interest the we to bring we with end cut to September, year. going some think

those, ahead that but as definitely of to as see lot as we potential in going going of help tariffs now. as Europe we year, well. drop, in we're a was is But major imported There end to start said, going the see to the inventory also are well. interest the be I us We seeing momentum right Europe don't some catalyst also rate a

the from Barclays. question line next comes with Mike Our of Leithead

Great. breakout the around disclosure increased starting TSS just appreciate That's want I this I quarter. to very helpful. the say product

comfortable help better But look want here tracking how obviously pricing just I this the to to or of over if don't people the thought. starts us contextualize we question, the on to are so. out you relative And market. First bottom couple I are were HFC know, than where half into are It's in context? a to pricing? we go lower you year? past, the back that of Can you follow-up where as HFC this just years Where historical we

Yes. is elevated, our year, pricing significantly I but prior mean I'll expectations. lower it's versus say, been where than in

response As that mean be scarcity quotas see quota drive John's to there's more questions, going reduce. a going I the in we turnaround to philosophy whole definitely is the I said there. when reduction around the to

RXX, It's is where a the definitely So advanced we're at in phase more been in now we saw pattern Europe we turning see that around. seeing Europe down.

And helpful. wanted big the the areas? cash and in cash do to you, discretionary speak -- leverage Can I this want year? say, get where ask Shane. for to generate to with more maybe just then of before just utilizing for, some picture, you half expect you to That's on debt back And leverage, Great.

Yes. Thanks, Mike.

As balances cash see cash improve we capital the in latter inflows half, similar some as of side. the to I indicating well being to on we some that collections down indicated in inventory work the working stable working side, that as script, from as

your earnings coming will are and targeting to take hopefully, our the below future. improve As as some trough near sustainably, time would a out, long-term Xx the get where in markets I target, say we is we improve here but levels such

of line the from Mizuho. with comes question next Roberts Our John

here. Congrats permit on getting the environmental Teflon

a a you go we to Before to XPXX I type in, that? need mid-XXXX, are you going similar Are launch [ permit? ] PXXX through process Opteon similar for going guess, (sic)

get PFA permit. to the going for the Related sell, to really Opteon exciting XPXX, to on we're It's registration need definitely to us. permit. clearly, we to for the want you need going product and we're Wherever permits. Thank congrats

we the want So countries to we're all on working that there where sell. are in things

And can further to to resistant then Altamira a important that do make Is there more pretty plant anything asset. is you droughts?

question. miss never crisis -- I Yes. Good crisis a take mean, to we good to great improve. a

our we actually crisis look need we this to So as and reduce substantial we usage. how at did work water entered our can

So it's engineering our great a efforts really team. by

that. and continuing we thing, are one that's So work on to

what kind other of options we then with we're The supply and we to local also some pursuing we those periods. do And have ourselves have that is inventory chain, during solutions other keep relative the engineering thirdly, locally government. thing

that those us to all going never a certainly key be for It's focus to we're So strategies. deploying again. situation have

of Our line with question comes UBS. from the next Spector Josh

Freon. I expected a fixed demand absorption I being somewhat I'm the higher buying headwind confused in around questions, on quota. a TSS. a you're couple Basically, slightly follow-up of cost is than guess you're you saying commentary had with and

seem On through? wouldn't indicate the can comments that been guess could have inventories and a that other going down maybe I help of or I that work there your to the to try hand, And to XQ, guess So on is because planned saying you what step you higher. what's that down. impact mitigate you're talk it's XQ? are impact size

that absorption that headwind. is cost Freon Is fixed a and why correct? for The

-- down, mean is Freon I Yes. demands for actually down. -- right? when that just because you year-over-year, the it's we step-down, it's think about say actually As quota it's

really the issue cost what's product in fixed So absorption that's driving that line.

have is should guess, know or just not and I But line me would maybe don't completely. Okay. guess that TSS. be up my Yes. a try maybe hear to again was we I'll level high able yours, And at I you're and around but expected I breaking if my ask it. expected, expectation

this said you? gap by, higher get of quota Corpus you the fixed going You until the of buying issue, guess, there's number on you that year. more if on would thing cost XQ, of know issues is a you're longer-term XXXX Throwing I [ Within absorption call aside, unique material, a out things don't ]. in cost fill whatever XQ, Opteon you have onetime or cost I some pricing a terms impacting to

go of things Or not about way no some is to How from the right that is these demand to think from much abating? helped improvement this? EBITDA to 'XX. 'XX So

are there before, cost of number, mean I about number our impacting Yes. in a as things that are talked we've TSS. a there's

are Some be some ongoing. of of them will them onetime,

capital perspective, from are So we have costs with additional a we -- we year. incurring expansion this Corpus that associated are

cost which partner JV in have have you'll We I'm XXXX. that we from China, online, that also drop when volume buying going in this our -- price additional we're into sorry, see product

of a capacity. adding We're ramp We expect X-year plant. that XX%

as a But The Freon depending it's opportunistic going other on specifically demand, XXXX be that have what fixed remain our to headwind. or either will on inventory I happens -- mean tailwind happens, product. what cost we be was you I'm with trying headwind, of a more to is it absorption, of And believe We this and to the to going a was related think the into one that, going quota. that year, versus is it transition. technology depending

answer Josh? your that question, Does

the off-line. side quantitative of except Yes, up I'll but follow it,

Global of question from Ahmed comes Advisors. line Alembic Hassan the with Our next

the market Shane, just you what in surprised XX%, is you saw? first particularly around transpired the what new a in regions? Can share gaining Congratulations, despite saw My the sequential with you was of I guys TT you things. potentially pleasantly the outage about Altamira. the maybe seeing bit across role. Were that volumes, question side on on talk uptick

stable. But saw Thanks kind way across see we have it share Asia, for question, stable we I stable a regions. little The that demand And share. in the is would bit America Hassan. North China. see [indiscernible] as would and I our we of We characterize is -- characterize uplift it the and of

Fair China are sort all up, things a of know the to it of measures European antidumping that with is of of tons side to from actually I historically, antidumping recently just expanding. XX,XXX month regionally, EU. of just that continuing XX,XXX And seems some product TT we enough. obviously, transported and Union these the side the mean, popped the whole And in things.

guys? maybe mean, you should think impact, I about So the EBITDA we impact profitability the for how

action EU currently and ] probably agree are aware And are definitely increasing, you. there opportunity to The that that. with us. at antidumping these us -- of share. an you for I wouldn't things is It's I and is gain stop happening, [ probably it an are Brazil for opportunity

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of the come Alexander Jefferies. question next Laurence will line with from Our

I sort commercial to Or questions. like Two thoughts operating see guess, capital how share? other Shane, from culture of just or your on perspective? would you how you'd observations is any in a hear love differences working to

to center Would industry up, the your products separately, guess, TSS you appears given for the we be XXXXs in I that get the be sort digits. And at targets scaling of opportunity, have these that kind than on fast how adopted? high-single higher approved being looking long-term data if in and of early

I'm to as Thanks, start of excited as I and in my the the here. just as just contrast the really for in. well say script, as mentioned its its came be to And I Laurence. commitment compare for just very here. to month. first won't here matter, and expectations people Chemours off. I'll people would anything. and expected to emerging I and goes the innovation far company, my world company I just the of all and coming excited new technologies It's be in my the resiliency its around exactly that I what

as on on capital, side As question from our customers about will that specific just the in mentioned appropriately your views. collect I think we well reduce script, around that to But obviously, I working inventories initial side. as work

flows. improvements So cash capital working overall to to push going on forward as enhance to our try

I'll about ask add know on. Maybe first just that culture, add me I'd to I on you didn't segment. but even to love Yes.

groups. in from did values people for I did had We the XX refresh countries. complete submit it And collaboratively. over surveys. We we company. We over my As extremely a we mentioned prepared remarks, XX X,XXX focused did had participation over

a have sound solid company, really proud this really I'm of in team. the and and future We

decade. what on be we and data to get to than it the of the project, high-single centers higher could digits we Moving as end

to this point, some as what a data new this drop -- to this you not think saying. to with I this or is you retrofits going thing really it's it's -- use recognize is replacement. for we This centers have not is you're is we're -- we're at One -- that building this that build require in technology. as time new going technology

going see develop. a to as contributor some We it's as we take to get to it XXXX. definitely time So meaningful

from line Viswanathan Our RBC Arun next question of Capital with Markets. comes the

I Congrats Denise the comments. those roles, and and Shane appreciate on

first I just ask -- on guess wanted to TT.

I range. are should curve or the and structural Obviously, think that So be issues give like And if conversion in that's you utilization XX% range, kind that on the sounds guys about? would they you XX% that. start industry think lower on Maybe of we your cost both oversupply you rates are where on I'll range with think are to or there in it any necessary? are know but us and but do sit appreciate utilization maybe probably any rationalization that don't rates if of end TT? just can in any you footprint characterize accurate, flexibility on still we use, markets some the

stabilization, Okay. cost footprint in transformation utilization achievement to But we're curve, $XXX point Thanks, plan. cost -- $XXX Arun. commodity towards TT for out I'm Thanks on it's ahead less don't see a on our I at of certainly, I your any in comment in laid that utilization But business million as don't the really rationalization. We going June, only the of plan of last question. And that already to to that's we're Through side of we not important left rates of be comment and that savings think think pricing end rates. about focused. we the of with where we're that And million year. the range.

great. opportunity, or similar kind driver you guys. immersion That's a And I'll the that as for then The could the Opteon ask maybe well, it future heard, earnings that Okay. of could another question the -- be past in you well. of is I had size guess, maybe on we of of order cooling

and cooling? different be TSS. about the or I should But in between know frame opportunity ] you Chemours [ how thinking could immersion we for are how that So TS the --

to market liquid billion. cooling for the $X.X Yes. $X.X billion TAM The XXXX is by like

is As expect meaningful by I technology be our But we it different, XXXX. to a requires little said, different equipment.

will the So be you conclusion that draw significant I part for a us opportunity big very of can it's our future. think a and

Our Instructions] will of come the Andrews Morgan next Vincent from line Stanley. [Operator question with

data correctly, you XX% cost I correct you way think center, I'm in math for things a about and a that believe about clarify the a XPXX data to assume, I if your everything other XX% may versus savings said if on drop of to have that you buy some that to wouldn't customer. a brand-new it provided replacement already When offers later building equipment. because have if the I it's said -- your I -- spoke I was not center, product I a heard on have. earlier product. want not comments, I that's -- Is the Denise, I'd apply based it? think the and incumbent the couple versus

to going computing this mean, it. about and in in way for think the the take is that's right why it. some to Yes. that And it the is develop. take super you time especially thank to it a in space power value in world of are Yes, the water and we're we such power It's excited future. about to when is and question. Vincent, adoption -- but compelling the the comes needs point where this time and I proposition, to going

you. process would then there with you what large you, sort just to a have like all available heard mentioned. I wouldn't And until One product of that if things you in have you're correctly, And up the was that is folks follow a it. were or function or production yourself, the XXXX to use the of that, permits that X other on qualification

separate So do stuff those then you I qualified where you assume and have you on be have own your processes to to are X have in.

just sort posts happening along happens. that are of can So equation as what's be us so that following mile we it understand walk through you the of both what's and could on sides big

sure. Yes,

do qualification, the volumes the mean for So qualification. we order substantial to in in actually

the of X So in process It's we're process those going and to X with -- we're that hyperscalers. to take right months, of that now. process various middle in the

and saying available have will we parallel, what So is that's that on scale that quantity, we're XXXX. piece. In commercial in working we're

Capital comes Our with from next question John BMO line of the McNulty Markets.

I one sheet. the follow-up. just on Just balance had a question

districts I -- part to liability. the as that cash cleanup out of the payment of made the think to water you you've spoke

sheet, I guess, balance so have on higher still million guess the I sitting thought or You of than post that $XXX have would payout. I cash restricted that as me strikes

as to us that a of sitting restricted far help cash? you what is understand placeholder can kind or holding why it's in as So

the in related about it John, outflow. million the cash restricted was this payment, in quarter $XXX for to settled

balance on our If look million. the cash you is balance $XXX sheet, restricted not

reflecting last quarter be year was that might what You side. or it last

think So quarter. it's ]. our [ cash, you would million I see million a in in restricted this $XX significant around decline sorry, I'm $XX

Second Chemours our We have the Thank of XXXX you question-and-answer Quarter session. for end reached the Results Call. joining Conference

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