Venator Materials (VNTRF) 8 May 202020 Q1 Earnings call transcript

Good day, and welcome to the Venator First Quarter 2020 Earnings Call. Today's conference is being recorded. After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions]

I would now like to turn the conference over to Jeffrey Schnell. ahead. go Please

and of Cathy, Venator's everybody. Jeffrey I'm Quarter Thank Relations good for Director Investor Earnings to Venator Schnell, XXXX you, Call. morning, Materials. First Welcome

the Vice President CFO. President on Joining Simon and today Kurt Executive and Turner, us Ogden, and call CEO; are

press slides This we to at via our earnings posted the first quarter for website morning, and the release our XXXX released release and accompanying venatorcorp.com.

elements the and make statements are about projections future. call, All they the for such and uncertainties while expectations, we may and guarantees and During current are they statements performance. risks or forward-looking, our our not expectations reflect future of involve

from our regarding with could results that these You SEC for expectations. materially actual filings projections the should or factors more information cause review differ the to

or on not forward-looking the revising We – during the quarter. updating do any plan publicly during call statements

also We EBITDA, free net income, refer financial EBITDA, as non-GAAP and adjusted will measures adjusted debt. flow to cash such net

the most has been to find which our website. You the to release, GAAP directly financial in earnings posted can reconciliations measures our comparable

turn now call pleasure to the is It over to my Simon.

Thank everyone. and good Jeff, you, morning,

all send Before our to, on you. safe. Tough Venator, going send wishes I'd best we today, those like hope we of call, to Team wishes your on get behalf and the families remain the call participants to we and on out you times, so

strong start and earnings million year diluted to turning $XX $X.XX X. the I'd had here to by share. adjusted start a in Slide per of like EBITDA quarter, the to and adjusted of delivered first Venator

our strategic on to make continue progress We priorities.

the COVID-XX challenges promptly improvement programs, pandemic. brought and on on our decisively we and are the business have executing by responded unprecedented to We

X. Turning to Slide

results, unfold unprecedented. little effect COVID-XX the to economic and pandemic QX the impacts are While that continue disruptive our on lockdown had

the more While XXXX several navigated it XXXX, along disruptive 'XX both and second a with note no has in events, true is other and industry through Venator has of half parallel, recently, of to that important number challenges. demand this

economic experienced we with impact an have of confident unknown, the the largely severity our deal remains We impact on business. I team, am and while can

prior it proactive, act at be of decisively was challenges, crucial each In the speed. and to

I'm We want I encouraged business plans. outline and regard, our that, In this and about progress. key just have by to our done observations our

team leadership actions, the range My and of place the protect integrity employees Substantially we I in put quickly to of all and operations. our and employees implemented office-based of a several our our working safeguards site. manufacturing prioritizing remotely, have our are safety

of all facilities guidelines. operating accordance currently manufacturing our local in are We

other sites. we a have social portfolio range people the enacted impact present of and wide the Venator's on of Additionally, distancing structural key our buffers against some safety reducing of COVID-XX. provides measures, including number

for products critical downstream food We of applications, used sales of and and the medical-grade some plastics greater these are protection have products PPE treatment packaging. and including in disease, into plastics,

of customer-tailored our the our aligned is us commitments to approach. impact This priorities. our and enables operate XXXX. first meet in balancing operations to manufacturing production pattern quarter by Inks We portfolio is out had have in the our food shown application. already resilience packaging our played COVID-XX the see strength applications, order Also, as of through while limited able are to strategic our have in our impacts on approach sites greater All the pandemic economies. customer largely evident used a which

suppliers our manage to to are risk mitigate in collaboration potential supply chain. close customers We and and working with the

multiline production flexibility Our respond. to the modular, us gives network

programs government utilizes on intend furlough for Our moderations margins. be plan, on, to which assistance build to production pressure allows cost-optimized with and we limited

based coronavirus. regional order the and book second customer to April XX% due quarter will TiOX demand is have This discussions and it expect XX% current We by on in to will actuals, decline differences. sequentially

meaningfully and our to In our incremental cash our response, business These and ongoing we improve uses to program. costs reduce are liquidity. are improvement range actions implementing of actions a

planned to our million, also prior capital reduction a expenditures our XXXX approximately reduced million of $XX estimate. We compared approximately to $XX

phased million through response a we of process. material particularly plan provide COVID-XX in expect our actions. many approximately in XXXX prices energy release $XX costs will cost In range see used We our those trending and down, addition, raw of sulfate

ores, this And possible is taken an year. on lower-priced direct we aggregate advantage the our cost achieved with it that tailwind sulfate see

strict the $XXX liquidity, with our are of quarter, stance under end managing the We and working aggressive maintaining At million of our we availability ABL. an towards consisting inventory had capital control. cash of

COVID-XX conditions warrant. of the identified could continue have additional and impact measures We we assess on our business should to take

Overall, associates will in we in the that stronger of will confident strong am a set steps plan emerge have I place our with pandemic better we in even experienced and taking Venator coupled the term. believe response I the the Venator that long are to for business, and position

the exiting and We target the to full to by our programs, is of program flow end $XX financial at all our of full improving year necessary We full and million expect the rate cost on our improvement from an strengthening $X Turning deliver business our deliver Slide XXXX the to first the rate and quarter complete actions million run Venator. XXXX, to business level. our $XX top additional delivered benefit in priority year. plan X our million for cash at

timing COVID-XX the elements be in adjusted pandemic. the to substituent and However, may response

$XX we the These cost benefit the subsequent of both Color deliver continue XXXX our efforts, to of actions to are consist which profitability to which targeted Pigments million target of to incremental of completion to BIP. improvement our business expect our operational improve efficiencies, and business. and We implement program

we mentioned, savings are related of in I As expect implementing million XXXX briefly actions to we response in COVID-XX. to $XX

throughout salary moving my changes have a part-time, furloughing the own to In addition bonus measures to and organization, salary we including implemented employees, structures. range others freezes of to reduction,

broadly We reduced spending. discretionary have also all other

our objectives. These necessary are measures to meet

business of the assessing additional initiatives, ability our need targeted the our in cost COVID-XX impact execution we the and continue on are the with for am monitor pleased confident actions. benefits am promised. I deliver as to While our to I of

the in adjusted Dioxide Titanium fourth $XX first first our compared X generated In XXXX. the XXXX Dioxide segment. segment our million Slide million quarter Titanium the in in EBITDA of of quarter to Turning million to and of $XX $XX quarter,

Our matching average margin period to reflects consecutive selling approach TiOX This sequential price declined prior customer remained fourth on globally year local but commitments supply a the in X% to compared ongoing quarter. volatility. network the our of our to stable reduce basis for currency

result products. TiOX volumes offset was improved year sets sale Titanium continued function and by Dioxide volumes and and lower prior the sequentially differentiated line seasonal strength primarily with of to higher specialty partially a of X% but declined historical period in the new patterns. compared TiOX in This

business In a improved Looking was regionally. on at to basis North demand and year-over-year roughly flat America, our fourth quarter. the compared

region on basis, the a quarter-over-quarter year-over-year remained mix in our American relatively and pricing approach. North stable, and customer reflecting customer-tailored our both Our

plastic differentiated and in from to Demand Europe the of disruptions. mix XXXX, improved the especially largest sequentially, Asia compared was flat higher in overweight and products industry. our single reflecting first Europe is down TiOX. to the customer for in and low our of market modestly, benefiting increased products we in product which quarter the year to compared sales new demand, primarily are region volumes for prior digits Compared and COVID-XX

pricing relatively sequential line historical on year-over-year the COVID-XX our sequential with demand patterns. was seasonal business local improved limited basis, In in stable a had quarter. both impact basis. in the On a first on currency, and

Malaysia products. the Our facility position export of manufacturing in specialty in Asia is and limited to our

of of from which X% the approximately applications represents China saw packaging for demand products. applications. for total , and a used TiOX benefited are variety of new stronger growth in plastics for For coatings, sales. also continued to healthcare we some food We And sectors relative

energy and quarter, partially In line million from $X costs, our high-grade primarily the higher, were business raw material program. first These by which headwinds, offset lower SG&A costs improvement benefit ores. were moved a with our expectations, costs in lower

Turning to the outlook.

globe earlier, I effect disruptions has the of economic unprecedented the the As extent unknown. remains COVID-XX and mentioned around created

regional TiOX to application second XX% demand expect the and XX% We quarter. compared decline differences first our for in the quarter to to with products

We We improvement our on continue benefit will remain and business expect expect to program. initiatives stable. vigilant remain our pricing to self-health from

the will pandemic. demand that following COVID-XX expect We recover

However, already targets. we timing that rates. emerge or the the interim, In countries and we to are actions to our at going worth trajectory. beginning noting and is balancing regions longer-term are predict It try strategic near-term are from our differing not lockdown, albeit with

are We to our competitiveness addressing further enhance opportunities and aggressively committed our our remain approach. customer-tailored costs, to assessing

TIOX continue Venator position better we that disruptions, that favorable near-term the strategy our expect to believe industry fundamentals and future. longer-term we remain for will While

and coatings decline Slide applications. X in driven the to declined due by to conditions certain soft Revenues to and compared Performance prior primarily period, year X% Additives. X% volumes in a Turning construction

Our price of average first X% increased the selling quarter XXXX. to compared

prior optimization as certain and sold year and for our This declined cost portfolio ongoing due the improvement demand lower we some an improved low-margin by into volumes targeted Pigments resulting business. partially Color offset cost exited for improved demand to compared from applications and position construction-related was to applications products operational initiatives.

to compared prior year period, America. declined due construction lower volumes to activity North the treatment Timber primarily in

offset plastics. the flat Our especially demand additive be automotive average volumes impacted continue That said, in partially compared favorable due mix within selling Functional by are year in coatings, the business. we were soft period. to improved stronger for demand to price to prior which by

programs steps to the taking these are as We of offset this market profitability improvement challenges our of improve business business. meaningful and part

a lower segment in The primarily quarter. quarter, as and the initiatives, million the prior up costs result This adjusted our Performance $X EBITDA $XX of our customer-tailored of self-help year approach. Additives to generated million is compared

due quarter. the be demand will COVID-XX to our business Additives the believe Additives impact segment expect in Functional We its and in severe coatings. second our exposure more will for adversely impact auto Performance to We

will broad we contraction. a see However, likely

explore a the of potential Pigments continue We to business. Color sale

currently COVID-XX due the However, virus. to the process pause on

the to expect resume practical. as soon We process as

to I some call over then provide the pass our now to will additional I financials. Kurt Kurt? discuss to comments. return will

Thanks, Simon.

Let's an price by In our primarily million business EBITDA both lower increased primarily EBITDA. the and to X. in first turn improvement TiOX business mix The meaningful improvement improvement to from $X costs, benefits Positive driven to including XXXX, the adverse The a Compared in in total in to and program price/mix costs, was million. the of business prior adjusted partially result and Performance $XX improvement was benefits year. decline total our quarter, fourth EBITDA by our the including by a the improvement also in compared of adjusted quarter to offset was declined Slide Additives. program. attributable sales volumes TiOX the contributed seasonal

than higher the our and trailing net Let's million, prefer, to and leverage our end turn to go adjusted the resources. leverage. of was EBITDA. with This our XX-month first totaled is X.Xx run less the quarter, ahead business At $XXX net ratio debt than we our X Slide capital and approximately as is objective net Xx

consisting undrawn approximately was and million cash in million of million the our facility. under the liquidity availability asset-based $XXX quarter, revolving of at Total lending $XXX $XX of end

XXXX. we ample us As gives this slide, credit shown have on our runway to and COVID-XX long-term do any And pandemic the improve we believe significant metrics. the maturities not until navigate

Simon our priority reduce to As by Compared for a mentioned, $XXX expect than Venator. top is to our cash more improving cash flow uses million. XXXX, we

Let line cash of uses. the me address our individual items

nearly expenditures which is Our prior compared in XX% to million reduction half $XX a million, million the XXXX. $XX This quarter. $XX updated for and our in spent capital approximately XXXX below was $XX outlook of to million is first range of

working in change net additional conditions of XXXX. be subject in including modest levels. cash to a market actions other expect is to manage inventory factors, our and source capital This a We to

includes program expected improvement million primarily ongoing restructuring total are of $XX Cash This Calais, to and business to our our site. $XX former in XXXX the payments France closure million.

$XX XXXX Our to cash uses me, legal joint expected venture in pension capital primarily in cash be obligations, to – approximately consisting XXXX approximately of fees. and million, are uses other expenditures are excuse expected be

reduce exploring items. are these We to opportunities

rate various In XXXX, a better consistent rate jurisdictions applicable current operate. tax tax under normalized rate we weighted the which apply XXXX to we expect our with adjusted as XX%, the we to reflect approximately be adjusted effective in average

adjusted expect XX% be We rate our tax long continue term. XX% to to in to the

In we expect cash to XXXX, be than taxes less $X million.

reducing to the We in our total free of $XX flow expected cash Pori-related XXXX, intensely in our and recognize focused and positive million from are expenses remain improving an our outflow $XX on to million down million importance uses. returning XXXX. of $XX to Finally, cash costs

our We continue the action take assess on COVID-XX to if conditions and and warrant. liquidity business prepared impact further market are of to

our We alternatives traditional are and currently exploring liquidity. other to financing bolster

Simon. to back it turn I'll that, With

you, Thank Kurt.

results, expect quarter challenges. which with Slide market I'm the to our our demonstrate self-help we Turning In value execution near customer-tailored measures. term, to experience pleased our and the XX. approach significant first of on

precautions to on closely managing our initiatives achieve We all protecting and our the network working include of of strategy and These capital, executing safety take follows: Notwithstanding our necessary COVID-XX, our will assets. steps targets. the integrity employees cost and production and our remains as our

to the customer effect committed our which and implementation range of diverse volatility approach agreements. our The reduces margin production more along with net inventories, actively are our for improves visibility We of manage by and anticipated we customer-tailored network and customers. us a

specialty These on well strengthening in margin products offer as Additives and benefits. mix focused market are our as in differentiated improving We TiOX leadership segment. our position robustness and Performance the

of that build most our quarter in products new As in a first reminder, on of to and growth volume XXXX. the contributed XXXX, continue we success our

on in our focused enhancing position all competitive businesses. are We our

delivered to deliver and million remaining and million $XX efficiencies. $XX of improvement expect cost have We our the operational program business

$XX Additionally, savings of proactively in to million XXXX from we I in highlighted cost the indirect are taking response actions pandemic.

also are negotiating raw material ores. including for We costs, aggressively lower

to free cash We intensely remain take focused improve on to and prepared as our our and are cash our flow. liquidity our usage – improving necessary. profitability reducing We

will Kurt cash continue we be our mentioned, we target XXXX and cash to As expect more than lower than million savings. in $XXX uses XXXX, more

committed shareholder portfolio fully active are We value to optimization. through maximizing

feasible. remains Although expect on Venator, pause, soon the of process color strategic pigments is to we temporarily priority resume as sale it as it and a

of cannot the are exceedingly have will predict impact full challenging These times. XXXX. We situation on dynamic the and

long-term to However, needs we and prepared and customers' are in take taking the strategy to the help emerge impact. are have stronger our We enable implementing to will mitigate shareholders. remain fundamentals. The longer-term the our near-term visibility positioned and for actions trends and from procedures value this we are Venator confident better into create and industry to meet aggressive

call you like to now thank we open continued for in interest that, With your the for would I Venator. questions.

question Our Bank. from first Instructions] [Operator of Deutsche Begleiter David comes

This is XX% of into type a guidance QX. some just your heard in year-over-year that of percentage to David decline do I basis? kind Huang here volume Dave. for on – XX% TiOX What translate of

line question? you repeat Could indistinct. was The Sorry. bit the a

time, Can you able repeat we your this hear are now question at to you.

Yes.

a percentage guidance on So volume type to you translate that XX% year-over-year decline, basis? of your what does XX% TiOX of can talk into about

been the looking XX basis. provide through year-on-year whether mean, I can you be Yes. in of strong element don't or past a business we a guidance on our months, numbers, But I stability there's price sense. in these see volume think the to XX that

to by industry And you increase America. price raw how then raw much How are that secondly, North driven you materials? I $X.XX guess, increases in XQ Or of do of much the higher do in think materials? that intend cover has proposed

of but to that relates higher how don't price ore Well, hence, announced just a market. much having a imagine, it jumping It's costs the factors. on out, think leads that out. But is I that in we always here. generally hard you, can that we have to versus as time And was generally And based what bear. you the announcements We We're to market announced hearing price we increases increases the question the that we have. will put of believe attributable combination parse market-based. it's as those

guys. thanks Okay,

Okay.

BMO of McNulty Capital Markets. comes question John from Next

Hi. on Colton Good Bina morning guys. for This John. is

Hi. you How are doing?

all my in you you you your ability is concerned deflationary raw the to materials to are later question deflationary first hold so the for price – year, become a So environment? potential in about my raw first having see if question at

in We sequentially very important as that earlier, point XQ approach in our we in an customer-tailored expect remain our prices pretty it's we said second been stability I to We said quarter. our steps through year-on-year, further successful we to manage prepared stable too. have to saw think remarks, I pricing. the taking stable note, Well, – and in

we're clear saying it's pretty our think what pricing. So I near-term about

put contain as very beyond would is venture prepared to second includes a all we sell and all would you that there very about not half. products. out about difficult volumes outlets say thing our is products see said our to in profile only say we the And but The we we're demand. clearly, that prepared any speculation the place XQ that, no we've our lockdown. the the specific I the major impact out. to I regions note on of how it's play that remarks, to world, – demand That think, of that All countries starting will well, guidance processes take in of emergence that are with

So recovery we're to that. I'm not encouraging. a shape at a afraid prepared guess take, that venture is But what could

Okay.

then your And that end to XX% the little mentioned are you little in talk XX% just the Okay. I volume about Could of are more intro think better. are as second remarks, quarter? of contributing a to markets where few follow-up challenging decline that markets that a the a end up holding a things in you maybe some

Yes. I think XX%, recap. is What if we said our that's our you mean, XX% is, to I actuals. think about that assembled just April through view

expect of limited which have book, proceeding customers order we negotiations to customers have course. of stage a and would and visibility, our discussions probably bit this at are of with more we very Our important, some our than

So what that's our view. forms

States see in and across see a operate Europe major from as From all quite We regional impact so quite big wasn't a not perspective. lockdown comprehensive differences pretty later case, the United clearly, differences. In maybe was came and that both than in perspective, we in regional Asia U.S., the three regional block. regions. application the the We the an

inks up see again, we well. see held than well less continue which decorative areas your the up hold coatings. are to would some continue of point Obviously, we plastics, well, applications, sulfate-containing be are hold parts coatings to the and and and about aforementioned specialties But industrial up to

fairly public give portfolio paper there you coatings adversely coatings impacted. data companies see looks a area, why I how has and as world. But our the probably been we access about view which So well-publicized with in more can product about you should think that I'd put of one the some think robust more

Thank great. very much. Okay, you

of next question Alexander Laurence from comes Our Jefferies.

– good do I'm I cadence quarters Hi, guys basically, that for savings $XX you over Laurence. technical, million see those has cost XXXX. This mentioned, my Kevin to if wondering Estok in first offer expect three on we with the question just morning. could is is guess you guys the maybe to of when savings? any

Yes. I said have that mean, been gotten of that breakout look, we've started But program, haven't we program. is cadence. we the We that, the what We've proactive. that given onto program.

personnel So And costs, year spread furloughs, I that about think fairly them could X/X with X/X across as of the the to year. think you work forth, so program the started and they as given already part-time savings of left. mainly nature to relate those evenly we

back great. I'm XX%. you segment. being the have decremental down I that, the so TiOX curious to April guess, in far just XX% And think that margins about then just in volumes to Okay, you visibility guys how

Just the here. of sort model working through

Yes, Kevin.

base market any we about see on to what of demand. our ability limited be as we margins, our production we impact to that that think in have terms pretty asset as we the would So think margins accordingly, match we such fine-tune

on just can that. we add Maybe to

that around along a our network some lends globe plate. be itself number to a with to with able lines here the sulfate grade and Europe flexibility have of and We have in modularity and chloride

flexibility. So we have that

our in mentioned significant we assistance quite remarks, programs. employee also governmental access prepared to have we As

undertake in in mind So that that various clearly, with will trimming production hold any the jurisdictions. we we

the schemes Italy, those furlough places are aware, like probably available you're sort Germany, of cetera. et As U.K., in

we as in another reduction that's in to volumes. So the the have sales it armory COVID were tool any combat

Great, thank you.

Our comes Barclays. next question from Fischer Duffy of

Question hear morning. just Yes, yes, can good you me? on –

Duffy? there. did You try up you again, break Will

sorry. Okay,

upstream just a of some on question ore. the So

mine two big around shutdowns They labor a And is COVID. had of around then pretty the kind hiccups for Africa issues. one quarter, the of South supplier ore in industry. some

ore supply where for And than can that? So just as bigger, you remind then vis-a-vis sit because you Africa industry are have impact on far or you the what the as seen supplying industry? me of smaller you you the South

Yes.

very heavily the industry So in take product underweight limited out the very we've of We've Richards South been amount an second of part question of perspective. from Africa clear. We Bay. a

to point, your a there the some reductions. course, that cope to to those were answer plan had In first I disruptions, right prior we of think but you're with pandemic even

the has, way now supply it away. evolving concern With that's pandemic the taken

foresee think the there your hitting to us. don't I that we question answer is, So

just Europe into great. Okay, how would so year? characterize general, this in Chinese And the flow then you far product

Yes.

fractions about pattern So last aggregate topped look, back to and four in and that three point important on has higher years, we into continued the North America. or Europe namely at million If fractions Asia out sort other around and seen note an to I that situation. those gradually these think years, X we've Chinese export smaller look has trajectory a go economies, of With tons. the

around So light five last used dealing that. kind gotten to of to years. four that's with the We've these

year, There's past end But front China, compensatory from been bad. China. We seen a We've domestic in that last these could that domestic some a back on effect. had couple end the long-range no operation of question before you cooling a the this pandemic. of been could dynamic year, the even there been economy appreciate, can pretty transient years as quite China more see has be exports have

As we that the coming down. in could market recovers China, back more see

has of hold North still a see and of part Chinese pattern been the type manageable. overall to seen and aggregate we've that absolute both weightings. of that We'd don't the the we of again, in not early in into product, part more fundamental. that continuum this accept see amount year we But longer-range America tick-up dissimilar that and exports, anything view highly We but the Europe there to slight a yearly as our

Terrific, thanks guys.

Thanks, Duffy.

Duffy. Thanks,

Koort Bob from comes question of Goldman next Sachs. Our

for on Dylan Bob. Campbell is This morning. Good

Bob. Hi,

of in about during competitive talk continued TiOX? bit market seeing mentioned quarter. Can share you're dynamics the regain of your the you One guys little competitors a

saw of that of quarter kind So into I'd dynamic the quarter love terms you then forward kind in also and to well. second the what hear first share of as in looking market

not our industry that very competitors we – the Yes. Dylan, large. Look, than talk obviously, stay mean behalf course, here we talk fairly about at or to I it's on were But either important, happy, of of to Venator. we're more

seen seen statistics we've clearly, stable think, we've Venator, what pretty seen we've XQ volumes. pricing And in very stable and I our very illustrated is

Now acquisition it's pickup that on true my it's market, XXXX kind and our really because that of out. But our some about And products. think not perspective over unchanged or numbers bear game. share XXXX focusing of basis, about some new basic loss. market I we It's had remains and target we're laminates the of is gain own on

And shift typical trends, does kind what Got that, then volume back quarter And increase in of volume for kind the it. to year? industry how the typical then of that is capital for that the Helpful. industry from working seasonality of of terms in on quarter? cadence second impact first of the the

I'll generalities Dylan. talk here, in

a from pretty – the – bit kick jump a think, in jump quarter from towards from percentage the herewith our are here times. XQ tell second of double-digit to a and saw would seasonal have But can pickup these it maybe is I Of general double-digit too, so expected have terms XQ we very a been a in exactly volume too, course, we up. would course, typical not you see into first – and I

generally general of cash So the back X% use in observed our we're see see not years in to sort then might working the multiple release on we on capital in business this first typical X% we going terms, speaking and to occasion. And over a we've draw, a in that of half, have the half.

the second that the of well. reality the course, out year taking could measures in we as the we're because well we've of statistics the quarter And our capital quarter. because for much is think be pandemic pretty half thrown Of spent I this first moderated in

some hesitate alignment there's market sure we cash say, And and we our on to very, make Suffice will any So there. clearly. however, ourselves focused we in shape impact conditions of broader position stay And won't very to present, inventories. recovery. are industries they well for control

you. Thank

comes next from Josh Our Spector of UBS. question

morning. Good Thanks questions. my hi. taking Yes, for

kind cash most incrementally you to free could how provided the of for quantify you flow have on Just flexibility? and are XXXX, you much worse where the do get now? expectations that flex your if bridge guys than And perhaps things you see able right

Sure, this Josh, Kurt. is

Let go feel like that. we've ahead expected and our with transparent take pretty here me uses. cash We been

there, as bucket our our roughly included as that are there there number, are look pension that in could – well opportunities to is that healthier think do that and would a of talked bit venture has well. sustained as we Thus capital could CapEx. think we working far, about just capital, $XX and numbers, in we there demand, release. this As Simon be upside CapEx, joint a touched that that we there's if bucket We do haven't other real there. those a contraction think opportunities particularly working we always we see million. we little expect and more within And then

just Performance year-over-year. pretty And That's I Additives, Okay. significant helpful. a pickup within mean,

considering? is $X million unique get be your down anything or rest about when the talked benefit were volumes that should You program, so just kind you And if a improvement what we from cost-out sustainable one-off there of bridge was normal the of to X% Or of kind back and was? year-over-year. or period? Can we

in say. Performance our quarter very you cost, as strength a comments Yes. course, the is Look, to It's It around of to pleasing, driven couple note is I of think that Additives. see mainly by important the quarter.

benefits We bit little and lower volumes our in of have a increase SG&A saw some on first costs. personnel And flow some the in price seasonal some business, some and raw we and material Functional and in quarter. energy through other cost sequentially, costs additives

quarter So concern been think there's business some functional the up some pretty well. We coatings underlying activity. all to and drop-off additives it, has far our second going we still see across be And our thus softer timber our construction for broad-based in holding environment business. around a those in

So a a cost, off, you more allow powered level, for to has drop quarter. look, of by a it been which second should but return I broad-based traditional the in quite think sort is

Okay, thanks.

Ahmed Alembic comes question next Our of from Global. Hassan

Simon and Good Kurt. morning,

Good Hassan. morning,

sort I completely demand-wise. Look, as evolving. just of of now, leaves we're trends what here all is are unpredictable of understand China. I looks to the first I particularly And well. hope and as things right beginning different demand sort seen start up, think to are see one up trying you open sitting we've obviously, obviously sort – QX mean, trying market guys I tea to read are the markets post how opening But

that Chinese what that So demand as to demand-wise are think the sort trying through just you're QX? could early that in has as well extrapolate the we just beyond how signs of opened market global Again, from up? terms seeing of

Yes. It's is participate very Hassan, China. a and side. in up an in – we say niche to would wishes, way thanks holding you interesting very question, this well I What

into Asia, your products hold into mainly China vis-a-vis least we other in products China well. the that mind in China, take into some limited. please comments. window into We're is as at somewhat market Our And taking and answer specialty to plastics

is that application, I of we were reiterate specialties, in for on the said business. application specialty apparel previous think as it the part calls surprise no to that textile our we'd of it's and what sort people it's

and so I'm lifting recovery – of nature meaningful far. heavy not seeing not saying sure any pretty signs some see to any of I'm continue we're We

up Our and pretty pretty plastics good business in that. holding well, about we China is feel

beginning I data. be that it's limited selling, extrapolate what though in note obviously, terms is could a extrapolation, would quite say encouraging to say of I have is it is it very considered leap that we market are that Now quite big-ticket the automotive What outlet to off – decorative paints constitute of lockdown. would and titanium first coatings like release global speaking, of around some to in for small the relatively vehicles a X%. I estimate the Generally dioxide, be from airplanes amount items and

So some the later to I of be recover. think those could applications

quarter. for we up be Hassan, is works, trajectory for second to clear the as We've be How tried really as could grabs. the

course, taken the of steps. market those out opening some were. down. all we we're is America incremental about largest up were contemplating and And by of see, encouraged past economy to through that North Europe, open mind closed Bear our encouraged some try in hear in of of are to willingness that this what in being COVID up and We

So But surprise. you, year, we've look, this from give say to though, in case our data would be across, that profiles recovery we've challenges it sorry that's over multiple in observed. the full a can to of say, I'm what that's I the what types tough volatility China. business read to it'd And can but be seen you

work destocking reason I all don't by bases think that see the months. next inventory have of through to poised why resume phase. any get nicely been prior the with can't XX XX, our this the COVID And I us once and through set management to difficult past that in we

sequential your demand in moving guidance Understood. And on terms things. have Obviously, of given guys side declines. you Understood. supply to the of

you be potentially supply an Just on utilization are it amount cuts, curtailments, the rate wanted figure side maybe to some be of of out things, not it from globally from coming online. plants sort of equivalent seeing

facilities. down, plants of shuttering some permanent Some shut companies considering maybe to even continuing some some plants,

thinking you is rightly bit So of how beyond picture? as sort the to obviously, supply forecast. that, are Because, about QX near-term a said, you difficult

We're we assets our where of mean, all running. closures. Yes. picture are not contemplating a are contemplating I

trimming course, our ultimately to demand. some can we're Of to there always be because going production match

have course, some said. Of we flexibilities I've

have we and move consider can to shutdowns we access maintenance schemes. have around, furlough We to

it might so capacity. question. the think relates do capacity demand I others I as because I speak tactical on way depends from that more way strategically to to issue. the that is I'm be a to totally us, And about can't but pattern us seen, what And answer plays pattern thinking of for capacity So supply they certainly think by remain a exercise, I how near-term out the production it It a – little just murky. for would the we're as very and think to about

Very Simon. fair. fair, Thanks very so much

Thanks, Hassan.

of from Morgan Stanley. Our comes question Andrews next Vincent

some Hi, levels the quarter, you're on declines the the first looking what you could for maybe for put inventory on this to just Thanks were the declines. Vincent. put curious is Steve XX, context the exiting But XQ sequentially? customer for context Haynes if around some color around volume

have and enough with speaking similarly they Customers Yes. And their sure kind right I but at mean, heavy. say to our business. our first customers. only effects It's to customers, Venator into as would quarter, our the the own and will they stocking normalized judgment the pretty products. own the through they I'm crept have within see, relationship our to they for end was uncertain [indiscernible] from make not wanted of pandemic inventories to both would we customer's our Again, be were wanted went now. as have of and overly hard on sure dynamic, were

six is say All of had XX% earlier, was can I to sort we've in like comment dissimilar a we disease. sort these medical impacts awful quarter. the months XX for to and months, painting second the awful which next the we're belittle the not industry type of past a of of was like of mean wanting destock XXXX, this in any this made which back-end either without faced – of I a pretty the picture

all So be we and our way that's this worked could I at think to we inventory, that say through that prepared had point. probably

guys. you Okay, helpful. thank Very

Our Bank of comes Byrne next question Steve of America. from

Hi, Steve.

This is for on Matt Steve.

Matt. Hi,

decline kind I'm wanted because Apologies but different pretty to calls, large. of CapEx around on I is jumping ask,

are I I that on your wanted or what missed cuts? opportunities I concentrating might being wondering of kind pushed earlier. clarify. apologize where have out you're spending Just just to

in I XXXX EHS way demands often this other our prudent cut required laid pandemic And said our our until be is don't is maintenance no CapEx to and that answer that Yes. I the out CapEx we've cut Equally, line surprise the is very we of should and want we've sort all of kind the that for to that. with CapEx heartland come and a current careful view. of prudent much maintenance core the think about here situation think think to We view into mean, exposure. evolves. spend way we EHS as it spend see I pretty which

clear pretty that's I answer a there. So think

around you seen the happen give-back Or to you've market what as Do could ores, needs was consistently and year? that to it Okay. that pretty cuts. at see I back theoretically to happen as in the South view? on pretty from What pressure And maybe over your pulled Africa and past But demand inflationary conversation relates loosen up? possible the know XQ. from a at has upstream all substantially that

suppliers, we this have I've we Well, the demand here What be bit look, in create a too not to events get in is I careful I've that that to ultimately, cutting impact are we expensive potentially including than about have feel often ore the modular than where Quite and later then running those lag, somewhat have rather like suppliers do. dramatically very industry sort of think seen could been occasions over say speculative. face a back footprint-type to way. decisions years destruction production some in previous suppliers, many facilities

depends ore raw that this as to for advantages a I'm play and time hard we including are for – – year to to much this all it's input all deals believe them trying we the on to able to predict class. price. But ores. there being that is be negotiating price on very pounds be certainly out material, And case It more through are going been to from move go receive in we'll receive around. that – some competitive often, not that, quite to us of categories done

sneak that more – does one just in. And to

of commented the Is primarily ores? really material given for tailwinds bake potentially raw chloride softening potential in about year. doesn't that sulfate You relief give-back seeing and any

down, rows related I sulfate We've think often ores down. energy the comments mentioned different of feedstock in mean, materials basket. raw observed the groupings. we mean, other coming sulfuric to coming I overall No. have the our advancing I acid and

So if together a extent. ores on we trends, not I speculative be we possible XQ year, pricing we the dynamics in could is it some could our and this tailwind we see. think put to see based It's it's trends in of we XXXX with know what XQ-type a That seeing that guarantee.

sneak you. may appreciate Thanks, there. Simon. in another I I

No problem.

from Our next SunTrust Jim comes question Robinson of Sheehan Humphrey.

some down cost about size Could Or that fixed volume an morning. just to it with all of TiOX a Jim. impact You for other absorption? Good volatile see would a expect that that the XX% EBITDA is drop is in XX%? parts? around Osterland margins same the be on potentially basis, you much you lot and on stable moving XX% XX% on to more to This than how of given based do Pete EBITDA kind quarter-over-quarter expect

And second don't And Yes, guidance. as ahead here we've others know, quantitative why this. don't quarter in think I to and here. than we guidance take go I you more fact, related provide given

relates book well to picture so orders had that that into And we think looking we we're as you as to ought as a give seeing order in it what as to the April May.

So no you. EBITDA for guidance specific

to expect call have the as carrying But of otherwise on moderate we I absorption reduce an that a from we we do specifically we you effect facilities, will fixed just unique any assets participate you of have this set indicated ability costs. that have our in would that remind where programs we that such furlough under

is countries that particularly can facilities. these access have, so as we the as in so in do we we overburdened moderate some participate aren't unique Europe, we that believe where costs government we such and programs of we furlough And nature with these that fixed

And the so particularly that us think advantage think gives potential margin any we here, when we an impact about quarter. second in

could amount And capacity given expanding loss to just capacity flow, the replace Pori? footprint change been your the you of the or be looking It's at That's frame? production as any has in preserving for current long-term to helpful. on from a your focus time either cash there the follow-up, goals

ample believe we within the network. have Well, now we right capacity

the at that that. In We course, make of have we on network. that product are transition. so thoughtfully Of to the or sure finishing the phase product Pori we COVID pause want a we transitioning taking do final situation, of of the light with specialty rest final that we're to

that. And beyond around second so be we'll the going a and as picture what think better just calibrate able as to is demand we look quarter develop I that to get like to

you. thank Great,

you. Thank

question Markets. comes Viswanathan Arun RBC last from of Capital Our

Good All morning. right, thanks.

Good Arun. morning,

on. rutile Again, are here I your hope shifts, of or Have to the seen at business able expand well. raw opportunities shifts just wanted ilmenite so we've major in about least and not sourcing within I to I'm I areas? you the assess there's doing different just what to, environment. ask been if to differences there you is. guess some ores and but guys some material major curious I opportunity your guess, any long-term

Yes.

we call that in at that. we different particularly creating some, conversation ore think I It's feedstock opportunities, regret of chose situation and prefer when you to to sitting there types have not to invest That's to resources that. Back capital significant let's the – XXXX different something can do get a very XXXX was that. while and back between through time, use don't We in doing a with flexibility to clear rather win-win. suppliers. them, prefer ourselves locations. suppliers We if go around by our talking that discussions we and intense

to for that's ultimately, work course, of too. us, But got

nine still has by So over market time. eight, And different opportunities. evolved up And been it's them I the but think that probably taken there by of I some. what back see feedstock different years group could well, probably ago. there that it as opportunities. different most are quite very have ourselves be was are There to

certainly So some the into opportunities, not hesitate limited and to are there should I situation warrant. would that we jump albeit maybe think

just you the given some whether maybe some accept just just your from standpoint, guess, financial lower of TiOX, types customers. customer have maybe opacity. a of And lower customer quality, seen be to then amongst I different any willingness curious of it position the smaller I'm base

that are I that No, favor. it's something and something look, that's not we Yes. we hearing, mean, not

those on that therein it's technical customer focus we our products think value value to And the strategy will We set. specialization differentiation. most and brings and of our

Thanks.

like for Turner Simon to over to we conference time, would turn And remarks. the closing at this

say, much. Thank you I in I'd thanking for you very and should to summarize like your interest Venator. close, by all

missing we enjoy to And on look that we again are you which with much. the engagement front. all, face-to-face meeting forward very We

the you of and we're mean to doesn't all coming that course, to not speak weeks Of months. quarter throughout available in the

will we a view Thank to company. very you please might give Jeff much to from your Venator. out reach down straight with our sort any additional you have. middle the you in do So of the questions interest best And for

you. Thank

ladies concludes and This today's teleconference. gentlemen. you, Thank

now disconnect. You may