STAMFORD, Conn., Aug. 4, 2015 /PRNewswire/ -- Tronox Limited
(NYSE:TROX) today reported second quarter 2015 revenue of
$617 million compared to $490 million in the second quarter 2014 and
$385 million in the first quarter
2015. Adjusted EBITDA was $116
million, excluding $49 million
of net lower of cost or market (LCM) charges, compared to
$103 million, excluding net non-cash
LCM credits of $5 million, in the
year-ago quarter and $73 million,
excluding net non-cash LCM charges of $9
million, in the prior quarter. Adjusted net loss
attributable to Tronox Limited in the second quarter was
$81 million, or $0.70 per diluted share, versus breakeven net
income, or $0.00 per diluted share,
in the year-ago quarter and a loss of $51
million, or $0.44 per diluted
share, in the first quarter 2015.
Tom Casey, chairman and CEO of
Tronox, said: "In our first quarter of operating two vertically
integrated businesses, we delivered a high level of adjusted EBITDA
and generated significant cash. Our two operating businesses,
TiO2 and Alkali, generated adjusted EBITDA of $135 million in the quarter excluding net
non-cash LCM charges. With that level of adjusted EBITDA, and
after capital expenditures of $61
million, our businesses delivered $74
million of cash to the company. This quarter's
performance demonstrated our cash generation strength even under
difficult market conditions in our TiO2 business. We are
increasing our cash generation across the company, including
reducing our operating costs and working capital. In the
second quarter, we signed a contract with a non-pigment company to
sell high-quality ilmenite that we had previously stockpiled in a
transaction that will produce cash of approximately $35-37 million over the next six quarters.
This is but one example of our heightened focus on cash
generation."
Casey continued: "Our TiO2 segment generated adjusted EBITDA of
$85 million and delivered cash of
$28 million in the second quarter,
despite 5 percent lower average selling prices for pigment products
compared to the first quarter. We have taken the appropriate
steps in our pigment and feedstock operations to reduce production
volumes to reduce inventory without affecting sales volumes, as
demand will be met from reduced production levels and finished
goods inventories. Our Alkali business continued its strong
operating performance in its first quarter within Tronox,
generating $50 million of adjusted
EBITDA and delivering $46 million of
cash. Alkali continues to operate in a sold-out mode driven
by strong export demand growth and a continued recovery in the
domestic market. The benefits of having Alkali in our
portfolio are many, but its high cash generation is particularly
valuable in this current period of depressed TiO2 market
conditions."
Casey concluded: "With the cash generation strength of our
operating businesses, coupled with our cash generation initiatives
sourced from operating cost and working capital reductions, as well
as capital expenditure reductions, we expect to generate positive
free cash flow in 2016 after capital expenditures, interest expense
and dividend payments. We intend to focus this cash surplus
on deleveraging and providing for future growth of the
company."
Titanium Dioxide (TiO2)
TiO2 segment revenue of $409
million was 17 percent lower than $490 million in the prior-year quarter, primarily
the result of lower pigment products sales. Sales of pigment
products declined 19 percent, as sales volumes declined 4 percent
and average selling prices declined 16 percent (11 percent on a
local currency basis). Sales volumes for pigment products
rebounded in EMEA, declined in Asia-Pacific and softened modestly in
North America versus the year-ago
quarter. Sales of titanium feedstocks and co-products,
including zircon and rutile, declined 15 percent versus the
year-ago quarter. Selling prices increased in the 4-6 percent
range for titanium feedstocks. Sales volumes increased for CP
titanium slag and rutile products declined. Zircon sales
volumes remained at normal levels but were lower compared to very
strong sales volumes in the year-ago quarter and selling prices
declined modestly.
Compared sequentially, TiO2 segment revenue of $409 million increased 6 percent versus
$385 million in the first quarter,
driven primarily by a 13 percent sales volumes increase for pigment
products. Pigment products revenue increased 8 percent, as
the 13 percent gain in sales volumes was partially offset by 5
percent lower average selling prices (3 percent on a local currency
basis). Sales volume gains for pigment products were realized
in North America, EMEA and
Asia-Pacific. Finished pigment products inventory at the end
of the second quarter was modestly above normal seasonal
levels. Sales of titanium feedstocks and co-products,
including zircon, increased 2 percent versus the prior
quarter. Sales volumes for titanium feedstocks were
lower. Selling prices for CP titanium slag increased 3
percent and rutile products remained level. Zircon sales
increased 12 percent, driven by 18 percent higher sales volumes,
partially offset by 5 percent lower selling prices.
We believe that because of oversupply conditions in the TiO2
market, average selling prices are at levels that are producing
inadequate returns. As a result, we have reduced production
volumes at both our pigment and feedstock operations.
Production has been suspended at one of six processing lines at our
Hamilton pigment plant and one of four processing lines at our
Kwinana pigment plant. Together, these processing line
curtailments represent approximately 15 percent of total pigment
production. We have also suspended operation at one slag
smelter at our KZN Sands facility, which has reduced our slag
production capacity by approximately 12 percent. We expect
sales volumes for both pigment products and titanium feedstocks to
be unaffected, as we intend to meet demand from reduced production
levels and finished goods inventories. If demand exceeds our
forecasts over the balance of 2015, we have the operating
flexibility to quickly increase production.
TiO2 segment adjusted EBITDA of $85
million, excluding $49 million
of net lower of cost or market (LCM) charges, compares to adjusted
EBITDA of $120 million, excluding net
non-cash credits of $5 million, in
the prior-year quarter and $94
million, excluding net non-cash LCM charges of $9 million, in the prior quarter. TiO2
segment operating loss of $41 million
compares to operating income of $30
million in the year-ago quarter and $9 million in the prior quarter.
Capital expenditures of $57
million in the quarter included $31
million related to the Fairbreeze mine project that will
produce feedstock to supply the slag furnaces at our KZN Sands
operations and provide new zircon and rutile co-products. The
Fairbreeze mine is expected to be commissioned as planned by the
end of 2015 and be fully operational in 2016. In 2016,
production of ilmenite feedstock and co-products zircon and natural
rutile will ramp to full production by mid-year. Total
capital expenditures related to the Fairbreeze mine from project
commencement through 2016 are estimated to be approximately
$225 million. Approximately
$125 million was spent from
commencement through the second quarter 2015.
With adjusted EBITDA of $85
million excluding net non-cash LCM charges and capital
expenditures of $57 million, TiO2
delivered cash of approximately $28
million in the second quarter. We are enhancing cash
generation in our TiO2 business in multiple ways – by focusing on
significant working capital reductions, driving operating cost
reductions and reducing capital expenditures. Since a
substantial portion of our operating costs are incurred in
currencies that have depreciated relative to the U.S. dollar, we
believe our cost structure has improved in U.S. dollar terms more
than that of other producers that incur a larger portion of their
operating costs in U.S. dollars.
Alkali
Alkali segment revenue of $208
million increased 8 percent compared to $194 million in the year-ago quarter on a pro
forma basis, as sales volumes gained 4 percent and average selling
prices increased 3 percent. Export sales led the volume
growth, supported by increased demand in the domestic market.
Higher selling prices were realized in both export and domestic
markets. Compared sequentially to the first quarter on a pro
forma basis, Alkali revenue increased 7 percent, as sales volumes
increased 8 percent, again led by export volume growth and
supported by increased momentum in the domestic market, while
average selling prices declined 1 percent as a result of customer
and regional mix. Alkali continues to operate in a sold-out
mode driven by strong export demand growth and a continued recovery
in the domestic market.
Alkali adjusted EBITDA of $50
million increased 14 percent compared to pro forma adjusted
EBITDA of $44 million in the
prior-year quarter, driven by higher sales volumes and selling
prices coupled with lower energy costs. Compared
sequentially, adjusted EBITDA increased 22 percent from pro forma
adjusted EBITDA of $41 million in the
prior quarter. Alkali segment operating income of
$25 million compares to operating
income of $31 million in the year-ago
quarter and $28 million in the prior
quarter, both on a pro forma basis. Capital expenditures in
the second quarter were $4
million. With adjusted EBITDA of $50 million and capital expenditures of
$4 million, Alkali delivered cash of
$46 million in the second
quarter.
Corporate
Corporate adjusted EBITDA was ($19)
million in the second quarter versus ($17) million in the year-ago quarter and
($21) million in the prior
quarter. The Corporate loss from operations was $34 million, including one-time expenses of
approximately $21 million related to
the Alkali acquisition, compared to $15
million in the prior-year quarter and $18 million in the prior quarter.
Consolidated
Selling, general and administrative expenses for the company in
the second quarter were $72 million,
including one-time expenses of approximately $21 million related to the Alkali acquisition and
on-going expenses of approximately $7
million related to Alkali business operations. This
compares to $45 million in the
prior-year quarter and $44 million in
the prior quarter.
Interest and debt expense of $52
million increased from $33
million in the year-ago quarter primarily due to a higher
debt level and a bridge loan financing expense of $8 million related to the Alkali
acquisition. On June 30, 2015,
gross consolidated debt was $3,134
million, and debt, net of cash, was $2,929 million. For the quarter, capital
expenditures were $61 million and
depreciation, depletion and amortization was $75 million.
Second Quarter 2015 Webcast Conference Call
Wednesday, August 5, 2015, at
8:30 a.m. ET (New York). The live call is open to
the public via Internet broadcast and telephone
Internet Broadcast:
http://www.tronox.com/
Dial-in telephone numbers:
U.S. / Canada: +1.877.831.3840
International: +1.253.237.1184
Conference ID: 94623862
Conference Call Presentation Slides: will be used during
the conference call and are available on our website at
http://www.tronox.com/
Webcast Conference Call Replay: available via the
Internet and telephone beginning on Wednesday, August 5, 2015 at 11:30 a.m. ET (New
York), until August 9,
2015.
Internet Replay: www.tronox.com
Dial-in telephone numbers:
U.S. / Canada: +1.855.859.2056
International: +1.404.537.3406
Conference ID: 94623862
Upcoming Conferences
During the third quarter a member of management is scheduled to
present at the following conferences:
- UBS Chemicals Conference, New
York, September 9,
2015
- RBC Capital Markets Global Industrial Conference, Las Vegas, September
10, 2015
- Credit Suisse Basic Materials Conference, New York, September 17,
2015
Accompanying materials will be available at
http://investor.tronox.com
About Tronox
Tronox Limited is a global leader in the mining, production, and
marketing of inorganic minerals and chemicals. The company operates
two vertically integrated businesses: Tronox Titanium Dioxide
(TiO2) and Tronox Alkali. For more information, visit
www.tronox.com
Segment Information
The reportable segments presented herein represent the operating
segments for which separate financial information is available and
we utilize on a regular basis to assess performance, align
strategies and allocate resources. Prior to the Alkali
acquisition, we had two operating and reportable segments, Mineral
Sands and Pigment, based on the way the management team was
organized and we assessed performance, aligned strategies and
allocated resources. As a result of the increased
interdependency between the Mineral Sands and Pigment businesses
and related organizational changes, we determined that it was
better to review the Mineral Sands and Pigment businesses, along
with our electrolytic business, as a combined one, TiO2, and to
assess performance, align strategies and allocate resources.
Following the Alkali acquisition, we restructured our organization
to reflect two integrated businesses, TiO2 and the acquired
business, Alkali, as our two operating and reportable segments with
functions that report to two senior executives of the company, who
report directly to our CEO.
Our TiO2 operating segment includes:
- exploration, mining and beneficiation of mineral sands
deposits
- heavy mineral production of titanium feedstock (including
chloride slag, slag fines and rutile), pig iron and zircon
- production and marketing of TiO2
- electrolytic manganese dioxide manufacturing and marketing
Our Alkali operating segment includes:
- exploration, mining and beneficiation of trona ore
- production and marketing of natural soda ash and its
derivatives: sodium bicarbonate, sodium sesquicarbonate and caustic
soda
Segment performance is evaluated based on segment operating
profit (loss), which represents the results of segment operations
before unallocated costs, such as general corporate expenses not
identified to a specific segment, interest expense, other income
(expense) and income tax expense or benefit.
Forward Looking Statements
Statements in this release that are not historical are
forward-looking statements within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995. These forward-looking
statements, which are subject to known and unknown risks,
uncertainties and assumptions about us, may include projections of
our future financial performance based on our growth strategies and
anticipated trends in our business. These statements are only
predictions based on our current expectations and projections about
future events. There are important factors that could cause our
actual results, level of activity, performance or achievements to
differ materially from the results, level of activity, performance
or achievements expressed or implied by the forward-looking
statements. These and other risk factors are discussed in the
company's filings with the Securities and Exchange Commission
(SEC), including those under the heading entitled "Risk Factors" in
our Annual Report on Form 10-K for the year ended December 31, 2014.
Moreover, we operate in a very competitive and rapidly changing
environment. New risks and uncertainties emerge from time to time,
and it is not possible for our management to predict all risks and
uncertainties, nor can management assess the impact of all factors
on our business or the extent to which any factor, or combination
of factors, may cause actual results to differ materially from
those contained in any forward-looking statements. Although we
believe the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results,
level of activity, performance or achievements. Neither we nor any
other person assumes responsibility for the accuracy or
completeness of any of these forward-looking statements. You should
not rely upon forward-looking statements as predictions of future
events. Unless otherwise required by applicable laws, we undertake
no obligation to update or revise any forward-looking statements,
whether as a result of new information or future developments.
Use of Non-U.S. GAAP Financial Information
To provide investors and others with additional information
regarding Tronox Limited's operating results, we have disclosed in
this press release certain non-U.S. GAAP financial measures,
including Adjusted EBITDA and adjusted net loss attributable to
Tronox. These non-U.S. GAAP financial measures are a
supplement to, and not a substitute for or superior to, the
company's results presented in accordance with U.S. GAAP. The
non-U.S. GAAP financial measures presented by the company may be
different than non-U.S. GAAP financial measures presented by other
companies. The non-U.S. GAAP financial measures are provided
to enhance the user's overall understanding of the company's
operating performance. Specifically, the company believes the
non-U.S. GAAP information provides useful measures to investors
regarding the company's financial performance by excluding certain
costs and expenses that the company believes are not indicative of
its core operating results. The presentation of these
non-U.S. GAAP financial measures are not meant to be considered in
isolation or as a substitute for results or guidance prepared and
presented in accordance with U.S. GAAP. A reconciliation of
the non-U.S. GAAP financial measures to U.S. GAAP results is
included herein.
Management believes these non-U.S. GAAP financial measures:
- Reflect Tronox Limited's ongoing business in a manner that
allows for meaningful period-to-period comparison and analysis of
trends in its business, as they exclude income and expense that are
not reflective of ongoing operating results;
- Provide useful information to investors and others in
understanding and evaluating Tronox Limited's operating results and
future prospects in the same manner as management and in comparing
financial results across accounting periods;
- Provide additional view of the operating performance of the
company by adding interest expenses, taxes, depreciation, depletion
and amortization to the net income. Further adjustments due to
purchase accounting and stock-based compensation charges attempt to
exclude items that are either non-cash or unusual in
nature;
- Assist investors to assess the company's compliance with
financial covenants under its debt instruments;
- Adjusted EBITDA is one of the primary measures management uses
for planning and budgeting processes and to monitor and evaluate
financial and operating results. Adjusted EBITDA is not a
recognized term under U.S. GAAP and does not purport to be an
alternative to measures of our financial performance as determined
in accordance with U.S. GAAP, such as net income (loss). Because
other companies may calculate EBITDA and Adjusted EBITDA
differently than Tronox, EBITDA may not be, and Adjusted EBITDA as
presented in this release is not, comparable to similarly titled
measures reported by other companies, and
- We believe that the non-U.S. GAAP financial measure "Adjusted
net loss attributable to Tronox Limited" and its presentation on a
per share basis provide useful information about our operating
results to investors and securities analysts. We also believe that
excluding the effects of these items from operating results allows
management and investors to compare more easily the financial
performance of our underlying businesses from period to
period.
Media Contact: Bud Grebey
Direct: +1.203.705.3721
Investor Contact: Brennen
Arndt
Direct: +1.203.705.3722
TRONOX
LIMITED
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS (US GAAP)
|
(UNAUDITED)
|
(Millions of U.S.
dollars, except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
Net
sales
|
|
$ 617
|
|
$ 490
|
|
$ 1,002
|
|
$ 908
|
|
Cost of goods
sold
|
|
593
|
|
430
|
|
943
|
|
823
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
24
|
|
60
|
|
59
|
|
85
|
|
Selling, general, and
administrative expenses
|
|
(72)
|
|
(45)
|
|
(116)
|
|
(91)
|
|
Restructuring
expense
|
|
(2)
|
|
-
|
|
(2)
|
|
-
|
|
|
|
|
|
|
|
|
|
Income (loss) from
operations
|
|
(50)
|
|
15
|
|
(59)
|
|
(6)
|
|
Interest and debt
expense, net
|
|
(52)
|
|
(33)
|
|
(86)
|
|
(67)
|
|
Loss on
extinguishment of debt
|
|
-
|
|
(8)
|
|
-
|
|
(8)
|
|
Other income
(expense), net
|
|
(5)
|
|
3
|
|
(1)
|
|
3
|
|
|
|
|
|
|
|
|
|
Loss before income
taxes
|
|
(107)
|
|
(23)
|
|
(146)
|
|
(78)
|
|
Income tax benefit
(provision)
|
|
(11)
|
|
25
|
|
(18)
|
|
26
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
(118)
|
|
2
|
|
(164)
|
|
(52)
|
|
Net income
attributable to noncontrolling interest
|
|
1
|
|
2
|
|
4
|
|
6
|
|
|
|
|
|
|
|
|
|
Net loss
attributable to Tronox Limited
|
|
$ (119)
|
|
$ -
|
|
$ (168)
|
|
$ (58)
|
|
|
|
|
|
|
|
|
|
Loss per share,
basic and diluted
|
|
$ (1.03)
|
|
$ -
|
|
$ (1.45)
|
|
$ (0.51)
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding, basic and diluted (in thousands)
|
|
115,569
|
|
113,962
|
|
115,472
|
|
113,770
|
|
|
|
|
|
|
|
|
|
Other Operating
Data:
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
$ 61
|
|
$ 43
|
|
$ 93
|
|
$ 67
|
|
Depreciation,
depletion and amortization expense
|
|
$ 75
|
|
$ 84
|
|
$ 140
|
|
$ 157
|
TRONOX
LIMITED
|
SCHEDULE OF
ADJUSTED EARNINGS (NON-U.S. GAAP)*
|
(UNAUDITED)
|
(Millions of U.S.
dollars, except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
Net
sales
|
|
$ 617
|
|
$ 490
|
|
$ 1,002
|
|
$ 908
|
|
Cost of goods
sold
|
|
584
|
|
430
|
|
934
|
|
823
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
33
|
|
60
|
|
68
|
|
85
|
|
Selling, general, and
administrative expenses
|
|
(53)
|
|
(45)
|
|
(99)
|
|
(91)
|
|
|
|
|
|
|
|
|
|
Adjusted income
(loss) from operations
|
|
(20)
|
|
15
|
|
(31)
|
|
(6)
|
|
Interest and debt
expense, net
|
|
(44)
|
|
(33)
|
|
(78)
|
|
(67)
|
|
Loss on
extinguishment of debt
|
|
-
|
|
(8)
|
|
-
|
|
(8)
|
|
Other income,
net
|
|
(5)
|
|
3
|
|
(1)
|
|
3
|
|
|
|
|
|
|
|
|
|
Adjusted income
(loss) before income taxes
|
|
(69)
|
|
(23)
|
|
(110)
|
|
(78)
|
|
Income tax benefit
(provision)
|
|
(11)
|
|
25
|
|
(18)
|
|
26
|
Adjusted net
income (loss)
|
|
(80)
|
|
2
|
|
(128)
|
|
(52)
|
|
Net income
attributable to noncontrolling interest
|
|
1
|
|
2
|
|
4
|
|
6
|
|
|
|
|
|
|
|
|
|
Adjusted net
income (loss) attributable to Tronox Limited (Non-U.S. GAAP)*
|
|
$ (81)
|
|
$ -
|
|
$ (132)
|
|
$ (58)
|
|
|
|
|
|
|
|
|
|
|
Diluted adjusted loss
per share, attributable to Tronox
Limited
|
|
$ (0.70)
|
|
$ -
|
|
$ (1.14)
|
|
$ (0.51)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding, diluted (in thousands)
|
|
115,569
|
|
113,962
|
|
115,472
|
|
113,770
|
|
* We believe that the
non-U.S. GAAP financial measure "Adjusted net income (loss)
attributable to Tronox Limited" and its presentation on a per share
basis provides useful information about our operating results to
investors and securities analysts. Adjusted earnings excludes the
effects related to the acquisitions of the mineral sands and Alkali
businesses including certain tax related adjustments. We also
believe that excluding the effects of these items from operating
results allows management and investors to compare more easily the
financial performance of our underlying businesses from period to
period. Additionally, the above schedule is presented in a format
which reflects the manner in which we manage our business, and is
not in accordance with U.S. GAAP.
|
TRONOX
LIMITED
|
RECONCILIATION OF
NON-U.S. GAAP FINANCIAL MEASURES
|
(UNAUDITED)
|
(Millions of U.S.
dollars, except share and per share data)
|
|
RECONCILIATION OF
NET LOSS
|
ATTRIBUTABLE TO
TRONOX LIMITED (U.S. GAAP)
|
TO ADJUSTED NET
LOSS
|
ATTRIBUTABLE TO
TRONOX LIMITED (NON-U.S. GAAP)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
Net loss attributable
to Tronox Limited (U.S. GAAP)
|
|
$ (119)
|
|
$ -
|
|
$ (168)
|
|
$ (58)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition related
expense (a)
|
|
36
|
|
-
|
|
34
|
|
-
|
Restructuring expense
(b)
|
|
2
|
|
-
|
|
2
|
|
-
|
|
|
|
|
|
|
|
|
|
Adjusted net
income (loss) attributable to Tronox Limited (Non-U.S.
GAAP)
|
|
$ (81)
|
|
$ -
|
|
$ (132)
|
|
$ (58)
|
|
|
|
|
|
|
|
|
|
Diluted loss per
share attributable to Tronox Limited (U.S. GAAP)
|
|
$ (1.03)
|
|
$ -
|
|
$ (1.45)
|
|
$ (0.51)
|
|
|
|
|
|
|
|
|
|
Acquisition related
expense, per diluted share
|
|
0.31
|
|
-
|
|
0.29
|
|
-
|
Restructuring
expense, per diluted share
|
|
0.02
|
|
-
|
|
0.02
|
|
-
|
|
|
|
|
|
|
|
|
|
Diluted adjusted
income (loss) per share attributable to Tronox Limited (Non-U.S.
GAAP)
|
|
$ (0.70)
|
|
$ -
|
|
$ (1.14)
|
|
$ (0.51)
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding, diluted (in thousands)
|
|
115,569
|
|
113,962
|
|
115,472
|
|
113,770
|
|
(a) One-time
non-operating items and the effect of acquisitions.
|
(b) Represents
severance costs associated with the shutdown of our sodium chlorate
plant.
|
TRONOX
LIMITED
|
SEGMENT
INFORMATION
|
(UNAUDITED)
|
(Millions of U.S.
dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TiO2
segment
|
|
$ 409
|
|
$ 490
|
|
$ 794
|
|
$ 908
|
Alkali
segment
|
|
208
|
|
-
|
|
208
|
|
-
|
|
|
|
|
|
|
|
|
|
Net
sales
|
|
$ 617
|
|
$ 490
|
|
$ 1,002
|
|
$ 908
|
|
|
|
|
|
|
|
|
|
Income (loss) from
operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TiO2
segment
|
|
$ (41)
|
|
$ 30
|
|
$ (32)
|
|
$ 26
|
Alkali
segment
|
|
25
|
|
-
|
|
25
|
|
-
|
Corporate
|
|
(34)
|
|
(15)
|
|
(52)
|
|
(32)
|
|
|
|
|
|
|
|
|
|
Income (loss) from
operations
|
|
(50)
|
|
15
|
|
(59)
|
|
(6)
|
Interest and debt
expense, net
|
|
(52)
|
|
(33)
|
|
(86)
|
|
(67)
|
Loss on
extinguishment of debt
|
|
-
|
|
(8)
|
|
-
|
|
(8)
|
Other income
(expense), net
|
|
(5)
|
|
3
|
|
(1)
|
|
3
|
|
|
|
|
|
|
|
|
|
Loss before income
taxes
|
|
(107)
|
|
(23)
|
|
(146)
|
|
(78)
|
Income tax benefit
(provision)
|
|
(11)
|
|
25
|
|
(18)
|
|
26
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
(118)
|
|
2
|
|
(164)
|
|
(52)
|
Net income
attributable to noncontrolling interest
|
|
1
|
|
2
|
|
4
|
|
6
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Tronox Limited
|
|
$ (119)
|
|
$ -
|
|
$ (168)
|
|
$ (58)
|
TRONOX
LIMITED
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(UNAUDITED)
|
(Millions of U.S.
dollars, except share and per share data)
|
|
|
|
June
30,
|
|
December
31
|
ASSETS
|
2015
|
|
2014
|
Current
Assets
|
|
|
|
|
|
Cash and cash
equivalents
|
$
205
|
|
$
1,276
|
|
Restricted
cash
|
5
|
|
3
|
|
Accounts receivable,
net of allowance for doubtful accounts
|
472
|
|
277
|
|
Inventories,
net
|
780
|
|
770
|
|
Prepaid and other
assets
|
60
|
|
42
|
|
Deferred tax
assets
|
10
|
|
13
|
|
|
|
|
|
|
|
|
|
|
|
Total current
assets
|
1,532
|
|
2,381
|
|
|
|
|
|
|
|
|
|
Noncurrent
Assets
|
|
|
|
|
Property, plant and
equipment, net
|
1,967
|
|
1,227
|
|
Mineral leaseholds,
net
|
1,736
|
|
1,058
|
|
Intangible assets,
net
|
260
|
|
272
|
|
Inventories,
net
|
14
|
|
57
|
|
Long-term deferred
tax assets
|
8
|
|
9
|
|
Other long-term
assets
|
75
|
|
61
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
$ 5,592
|
|
$
5,065
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
Current
Liabilities
|
|
|
|
|
Accounts
payable
|
$
203
|
|
$
160
|
|
Accrued
liabilities
|
156
|
|
147
|
|
Short-term
debt
|
150
|
|
-
|
|
Long-term debt due
within one year
|
17
|
|
18
|
|
Income taxes
payable
|
26
|
|
32
|
|
Deferred tax
liabilities
|
8
|
|
9
|
|
|
|
|
|
|
|
|
|
|
|
Total current
liabilities
|
560
|
|
366
|
|
|
|
|
|
|
|
|
|
Noncurrent
Liabilities
|
|
|
|
|
Long-term
debt
|
2,967
|
|
2,375
|
|
Pension and
postretirement healthcare benefits
|
168
|
|
172
|
|
Asset retirement
obligations
|
82
|
|
85
|
|
Long-term deferred
tax liabilities
|
190
|
|
204
|
|
Other long-term
liabilities
|
96
|
|
75
|
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
4,063
|
|
3,277
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
Equity
|
|
|
|
|
Tronox Limited Class
A ordinary shares, par value $0.01 — 65,531,044 shares issued and
64,483,113 shares outstanding at June 30, 2015 and 65,152,145
shares issued and 63,968,616 shares outstanding at December 31,
2014
|
1
|
|
1
|
|
Tronox Limited Class
B ordinary shares, par value $0.01 — 51,154,280 shares issued and
outstanding at June 30, 2015 and December 31, 2014.
|
-
|
|
-
|
|
Capital in excess of
par value
|
1,490
|
|
1,476
|
|
Retained
earnings
|
302
|
|
529
|
|
Accumulated other
comprehensive loss
|
(432)
|
|
(396)
|
|
|
|
|
|
|
|
|
|
|
|
Total
shareholders' equity
|
1,361
|
|
1,610
|
|
Noncontrolling
interest
|
168
|
|
178
|
|
|
|
|
|
|
|
|
|
|
|
Total
equity
|
1,529
|
|
1,788
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
and equity
|
$ 5,592
|
|
$
5,065
|
|
|
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(UNAUDITED)
|
(Millions of U.S.
dollars)
|
|
|
|
|
|
|
|
|
|
Six Months Ended
June 30,
|
|
|
|
|
|
2015
|
|
2014
|
|
|
|
|
Cash Flows from
Operating Activities:
|
|
|
|
Net loss
|
$ (164)
|
|
$ (52)
|
Adjustments to
reconcile net loss to net cash provided by operating
activities:
|
|
|
|
Depreciation,
depletion and amortization
|
140
|
|
157
|
Deferred income
taxes
|
(2)
|
|
(45)
|
Share-based
compensation expense
|
13
|
|
11
|
Amortization of
deferred debt issuance costs and discount on debt
|
5
|
|
5
|
Pension and
postretirement healthcare benefit expense
|
1
|
|
3
|
Loss on
extinguishment of debt
|
-
|
|
8
|
Other noncash items
affecting net loss
|
14
|
|
11
|
Contributions to
employee pension and postretirement plans
|
(8)
|
|
(7)
|
Changes in assets and
liabilities:
|
|
|
|
Increase in accounts
receivable
|
(52)
|
|
(64)
|
Decrease in
inventories
|
53
|
|
2
|
(Increase) decrease
in prepaid and other assets
|
7
|
|
8
|
Increase (decrease)
in accounts payable and accrued liabilities
|
1
|
|
(10)
|
Increase (decrease)
in income taxes payable
|
4
|
|
9
|
Other, net
|
1
|
|
(1)
|
|
|
|
|
Cash provided by
operating activities
|
13
|
|
35
|
|
|
|
|
Cash Flows from
Investing Activities:
|
|
|
|
Capital
expenditures
|
(93)
|
|
(67)
|
Acquisition of
business
|
(1,653)
|
|
-
|
|
|
|
|
Cash used in
investing activities
|
(1,746)
|
|
(67)
|
|
|
|
|
Cash Flows from
Financing Activities:
|
|
|
|
Repayments of
debt
|
(9)
|
|
(11)
|
Proceeds from
debt
|
750
|
|
-
|
Debt issuance
costs
|
(15)
|
|
(2)
|
Dividends
paid
|
(59)
|
|
(58)
|
Proceeds from the
exercise of warrants and options
|
3
|
|
2
|
|
|
|
|
Cash provided by
(used in) financing activities
|
670
|
|
(69)
|
|
|
|
|
Effects of
exchange rate changes on cash and cash
equivalents
|
(8)
|
|
(2)
|
|
|
|
|
Net increase
(decrease) in cash and cash equivalents
|
(1,071)
|
|
(103)
|
Cash and cash
equivalents at beginning of period
|
1,276
|
|
1,475
|
|
|
|
|
Cash and cash
equivalents at end of period
|
$ 205
|
|
$1,372
|
|
|
|
|
TRONOX
LIMITED
|
RECONCILIATION OF
NET LOSS TO EBITDA AND ADJUSTED EBITDA (NON-U.S.
GAAP)
|
(UNAUDITED)
|
(Millions of U.S.
dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$ (118)
|
|
$
2
|
|
$ (164)
|
|
$ (52)
|
|
|
|
|
|
|
|
|
|
|
Interest and debt
expense, net
|
52
|
|
33
|
|
86
|
|
67
|
|
Interest
income
|
(2)
|
|
(3)
|
|
(4)
|
|
(6)
|
|
Income tax (benefit)
provision
|
11
|
|
(25)
|
|
18
|
|
(26)
|
|
Depreciation,
depletion and amortization expense
|
75
|
|
84
|
|
140
|
|
157
|
|
|
|
|
|
|
|
|
|
EBITDA
|
18
|
|
91
|
|
76
|
|
140
|
|
|
|
|
|
|
|
|
|
|
Amortization of
inventory step-up from purchase accounting
|
9
|
|
-
|
|
9
|
|
-
|
|
Transfer tax due to
acquisition
|
(3)
|
|
-
|
|
(11)
|
|
-
|
|
Transaction cost
(a)
|
21
|
|
-
|
|
27
|
|
-
|
|
Share-based
compensation
|
7
|
|
6
|
|
13
|
|
11
|
|
Loss on
extinguishment of debt
|
-
|
|
8
|
|
-
|
|
8
|
|
Foreign currency
remeasurement
|
5
|
|
(2)
|
|
5
|
|
4
|
|
Other items
(b)
|
10
|
|
5
|
|
12
|
|
9
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$
67
|
|
$ 108
|
|
$
131
|
|
$ 172
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA by
Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tio2
segment
|
$ 36
|
|
$ 125
|
|
$ 121
|
|
$ 208
|
|
Alkali
segment
|
50
|
|
-
|
|
50
|
|
-
|
|
Corporate
|
(19)
|
|
(17)
|
|
(40)
|
|
(36)
|
|
|
|
|
|
|
|
|
|
|
|
$ 67
|
|
$ 108
|
|
$ 131
|
|
$ 172
|
|
|
|
|
|
|
|
|
|
(a)
|
During 2015,
transaction costs consist of costs associated with the acquisition
of the Alkali business, including banking fees, legal and
professional fees.
|
(b)
|
Includes noncash
pension and postretirement costs, accretion expense, severance
expense, and other items.
|
Logo -
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To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/tronox-reports-second-quarter-2015-financial-results-300123703.html
SOURCE Tronox Limited