|
|
|
|
|
(State or Other Jurisdiction of Incorporation)
|
(Commission File Number)
|
(IRS Employer Identification No.)
|
|
|
Laporte Road, Stallingborough
|
|
|
|
Grimsby, North East Lincolnshire, DN40 2PR, UK
|
|
|
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
|
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
|
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
|
|
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
|
|
Title of each class
|
Trading Symbol(s)
|
Name of exchange on which registered
|
|
|
|
|
| Item 2.02. |
Results of Operations and Financial Condition.
|
| Item 9.01. |
Financial Statements and Exhibits.
|
| (d) |
Exhibits.
|
|
Exhibit No.
|
Description
|
|
|
Press Release, dated July 26, 2023 reporting Tronox Holdings plc’s financial results for the second
quarter 2023.
|
||
|
104
|
Inline XBRL for the cover page of this Current Report on Form 8-K.
|
|
TRONOX HOLDINGS PLC
|
|||
|
Date: July 27, 2023
|
By:
|
/s/ Jeffrey N. Neuman
|
|
| Name: | Jeffrey N. Neuman | ||
| Title: | Senior Vice President, General Counsel and Secretary | ||

| • |
Produced revenue of $794 million, a 12% increase compared to the prior quarter, or a 16% decrease compared to the prior year
|
| • |
Generated income from operations of $84 million, and a net loss of $269 million, inclusive of a valuation allowance of $293 million established against the deferred tax assets within our Australia
jurisdiction; adjusted net income was $24 million (non-GAAP)
|
| • |
GAAP diluted EPS was $(1.72); achieved adjusted diluted EPS of $0.16 (non-GAAP)
|
| • |
Delivered Adjusted EBITDA of $168 million, at the high end of the guided range, and an Adjusted EBITDA margin of 21.2%
|
| • |
Invested $55 million in capital expenditures in the quarter
|
| • |
Generated $81 million in free cash flow in the quarter
|
| • |
TiO2 volumes expected to be relatively flat to Q2 2023 levels
|
| • |
Zircon volumes expected to decline by 15 to 20 thousand tons versus Q2 2023
|
| • |
Adjusted EBITDA expected to be $115-135 million
|
|
($M unless otherwise noted)
|
Q2 2023
|
Q2 2022
|
Y-o-Y %∆
|
|
Q1 2023
|
Q-o-Q %∆
|
|
|||||||||||||
|
Revenue
|
$
|
794
|
$
|
945
|
(16)%
|
|
$
|
708
|
12%
|
|
||||||||||
|
TiO2
|
$
|
611
|
$
|
769
|
(21)%
|
|
$
|
560
|
9%
|
|
||||||||||
|
Zircon
|
$
|
95
|
$
|
111
|
(14)%
|
|
$
|
72
|
32%
|
|
||||||||||
|
Other products
|
$
|
88
|
$
|
65
|
35%
|
|
$
|
76
|
16%
|
|
||||||||||
|
Income from operations
|
$
|
84
|
$
|
190
|
(56)%
|
|
$
|
62
|
35%
|
|
||||||||||
|
Net (Loss) Income
|
$
|
(269
|
)
|
$
|
375
|
(172)%
|
|
$
|
25
|
n/m
|
|
|||||||||
|
Net (Loss) Income attributable to Tronox
|
$
|
(269
|
)
|
$
|
375
|
(172)%
|
|
$
|
23
|
n/m
|
|
|||||||||
|
GAAP diluted (loss) earnings per share
|
$
|
(1.72
|
)
|
$
|
2.37
|
(173)%
|
|
$
|
0.15
|
n/m
|
|
|||||||||
|
Adjusted diluted earnings per share
|
$
|
0.16
|
$
|
0.84
|
(81)%
|
|
$
|
0.15
|
7%
|
|
||||||||||
|
Adjusted EBITDA
|
$
|
168
|
$
|
275
|
(39)%
|
|
$
|
146
|
15%
|
|
||||||||||
|
Adjusted EBITDA Margin %
|
21.2%
|
|
29.1%
|
|
(790) bps
|
20.6%
|
|
60 bps
|
||||||||||||
|
Free cash flow
|
$
|
81
|
$
|
(67
|
)
|
n/m
|
|
$
|
(172
|
)
|
n/m
|
|
||||||||
| Y-o-Y %∆ | Q-o-Q %∆ | |||||||||||||||||
|
Volume
|
Price
|
FX
|
Volume
|
Price
|
FX
|
|||||||||||||
|
TiO2
|
(22)%
|
|
1%
|
|
1%
|
|
9%
|
|
(1)%
|
|
1%
|
|
||||||
|
Zircon
|
(21)%
|
|
7%
|
|
—%
|
|
33%
|
|
(1)%
|
|
—%
|
|
||||||
|
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||||||||
|
|
2023
|
2022
|
2023
|
2022
|
||||||||||||
|
Net sales
|
$
|
794
|
$
|
945
|
$
|
1,502
|
$
|
1,910
|
||||||||
|
Cost of goods sold
|
637
|
682
|
1,212
|
1,415
|
||||||||||||
|
Gross profit
|
157
|
263
|
290
|
495
|
||||||||||||
|
Selling, general and administrative expenses
|
73
|
73
|
144
|
151
|
||||||||||||
|
Venator settlement
|
—
|
—
|
—
|
85
|
||||||||||||
|
Income from operations
|
84
|
190
|
146
|
259
|
||||||||||||
|
Interest expense
|
(38
|
)
|
(28
|
)
|
(71
|
)
|
(60
|
)
|
||||||||
|
Interest income
|
3
|
2
|
6
|
4
|
||||||||||||
|
Loss on extinguishment of debt
|
—
|
(20
|
)
|
—
|
(21
|
)
|
||||||||||
|
Other income, net
|
4
|
8
|
6
|
4
|
||||||||||||
|
Income before income taxes
|
53
|
152
|
87
|
186
|
||||||||||||
|
Income tax (provision) benefit
|
(322
|
)
|
223
|
(331
|
)
|
205
|
||||||||||
|
Net (loss) income
|
(269
|
)
|
375
|
(244
|
)
|
391
|
||||||||||
|
Net income attributable to noncontrolling interest
|
—
|
—
|
2
|
—
|
||||||||||||
|
Net (loss) income attributable to Tronox Holdings plc
|
$
|
(269
|
)
|
$
|
375
|
$
|
(246
|
)
|
$
|
391
|
||||||
|
|
||||||||||||||||
|
(Loss) Earnings per share:
|
||||||||||||||||
|
Basic
|
$
|
(1.72
|
)
|
$
|
2.40
|
$
|
(1.58
|
)
|
$
|
2.52
|
||||||
|
Diluted
|
$
|
(1.72
|
)
|
$
|
2.37
|
$
|
(1.58
|
)
|
$
|
2.46
|
||||||
|
|
||||||||||||||||
|
Weighted average shares outstanding, basic (in thousands)
|
156,780
|
155,867
|
155,986
|
155,252
|
||||||||||||
|
Weighted average shares outstanding, diluted (in thousands)
|
156,780
|
158,448
|
155,986
|
158,996
|
||||||||||||
|
Other Operating Data:
|
||||||||||||||||
|
Capital expenditures
|
55
|
99
|
148
|
202
|
||||||||||||
|
Depreciation, depletion and amortization expense
|
68
|
67
|
139
|
135
|
||||||||||||
|
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||||||||
|
|
2023
|
2022
|
2023
|
2022
|
||||||||||||
|
|
||||||||||||||||
|
Net (loss) income attributable to Tronox Holdings plc (U.S. GAAP)
|
$
|
(269
|
)
|
$
|
375
|
$
|
(246
|
)
|
$
|
391
|
||||||
|
|
||||||||||||||||
|
Venator settlement (a)
|
—
|
—
|
—
|
85
|
||||||||||||
|
Loss on extinguishment of debt (b)
|
—
|
20
|
—
|
21
|
||||||||||||
|
Income tax expense - deferred tax assets (c)
|
—
|
(1
|
)
|
—
|
(8
|
)
|
||||||||||
|
Tax valuation allowance (d)
|
293
|
(262
|
)
|
293
|
(262
|
)
|
||||||||||
|
Other (e)
|
—
|
2
|
1
|
3
|
||||||||||||
|
Adjusted net income attributable to Tronox Holdings plc (non-U.S. GAAP) (1)
|
$
|
24
|
$
|
134
|
$
|
48
|
$
|
230
|
||||||||
|
|
||||||||||||||||
|
Diluted (loss) net income per share (U.S. GAAP)
|
$
|
(1.72
|
)
|
$
|
2.37
|
$
|
(1.58
|
)
|
$
|
2.46
|
||||||
|
|
||||||||||||||||
|
Venator settlement, per share
|
—
|
—
|
—
|
0.53
|
||||||||||||
|
Loss on extinguishment of debt, per share
|
—
|
0.13
|
—
|
0.13
|
||||||||||||
|
Income tax expense - deferred tax assets, per share
|
—
|
(0.01
|
)
|
—
|
(0.05
|
)
|
||||||||||
|
Tax valuation allowance, per share
|
1.87
|
(1.65
|
)
|
1.87
|
(1.65
|
)
|
||||||||||
|
Other, per share
|
—
|
0.01
|
0.01
|
0.02
|
||||||||||||
|
Diluted adjusted net income per share attributable to Tronox Holdings plc (non-U.S. GAAP) (2)
|
$
|
0.16
|
$
|
0.84
|
$
|
0.31
|
$
|
1.44
|
||||||||
|
|
||||||||||||||||
|
Weighted average shares outstanding, diluted (in thousands)
|
157,159
|
158,448
|
157,059
|
158,996
|
||||||||||||
|
(1) No income tax impacts have been given to any item as they were recorded in jurisdictions with full valuation allowances.
|
|
(2) Diluted adjusted net income per share attributable to Tronox Holdings plc was calculated from exact, not rounded Adjusted net income attributable to
Tronox Holdings plc and share information.
|
|
(a) Represents the breakage fee including interest associated with the Venator settlement which were recorded in "Venator settlement" in the Consolidated
Statements of Operations.
|
|
(b) 2022 amount represents the loss in connection with the redemption of the 6.5% Senior Secured Notes and the issuance of a new term loan which closed in
April 2022.
|
|
(c) Represents a charge to tax expense for the impact on deferred tax assets from a change in tax rates in a foreign tax jurisdiction.
|
|
(d) Represents changes within the Company's Australian deferred tax assets' valuation allowance.
|
|
(e) Represents other activity not representative of the ongoing operations of the Company.
|
|
|
June 30, 2023
|
December 31, 2022
|
||||||
|
ASSETS
|
||||||||
|
Current Assets
|
||||||||
|
Cash and cash equivalents
|
$
|
167
|
$
|
164
|
||||
|
Accounts receivable (net of allowance for credit losses of $4 million and $4 million as of June 30, 2023 and December
31, 2022, respectively)
|
372
|
377
|
||||||
|
Inventories, net
|
1,400
|
1,278
|
||||||
|
Prepaid and other assets
|
145
|
135
|
||||||
|
Income taxes receivable
|
—
|
6
|
||||||
|
Total current assets
|
2,084
|
1,960
|
||||||
|
|
||||||||
|
Noncurrent Assets
|
||||||||
|
Property, plant and equipment, net
|
1,790
|
1,830
|
||||||
|
Mineral leaseholds, net
|
662
|
701
|
||||||
|
Intangible assets, net
|
246
|
250
|
||||||
|
Lease right of use assets, net
|
136
|
136
|
||||||
|
Deferred tax assets
|
929
|
1,233
|
||||||
|
Other long-term assets
|
208
|
196
|
||||||
|
Total assets
|
$
|
6,055
|
$
|
6,306
|
||||
|
|
||||||||
|
LIABILITIES AND EQUITY
|
||||||||
|
Current Liabilities
|
||||||||
|
Accounts payable
|
$
|
437
|
$
|
486
|
||||
|
Accrued liabilities
|
244
|
252
|
||||||
|
Short-term lease liabilities
|
23
|
20
|
||||||
|
Short-term debt
|
203
|
50
|
||||||
|
Long-term debt due within one year
|
23
|
24
|
||||||
|
Income taxes payable
|
10
|
18
|
||||||
|
Total current liabilities
|
940
|
850
|
||||||
|
|
||||||||
|
Noncurrent Liabilities
|
||||||||
|
Long-term debt, net
|
2,450
|
2,464
|
||||||
|
Pension and postretirement healthcare benefits
|
91
|
89
|
||||||
|
Asset retirement obligations
|
153
|
153
|
||||||
|
Environmental liabilities
|
49
|
51
|
||||||
|
Long-term lease liabilities
|
108
|
110
|
||||||
|
Deferred tax liabilities
|
142
|
153
|
||||||
|
Other long-term liabilities
|
36
|
33
|
||||||
|
Total liabilities
|
3,969
|
3,903
|
||||||
|
|
||||||||
|
Commitments and Contingencies
|
||||||||
|
Shareholders’ Equity
|
||||||||
|
Tronox Holdings plc ordinary shares, par value $0.01 — 156,786,791 shares issued and outstanding at June 30, 2023 and
154,496,923 shares issued and outstanding at December 31, 2022
|
2
|
2
|
||||||
|
Capital in excess of par value
|
2,054
|
2,043
|
||||||
|
Retained earnings
|
794
|
1,080
|
||||||
|
Accumulated other comprehensive loss
|
(809
|
)
|
(768
|
)
|
||||
|
Total Tronox Holdings plc shareholders’ equity
|
2,041
|
2,357
|
||||||
|
Noncontrolling interest
|
45
|
46
|
||||||
|
Total equity
|
2,086
|
2,403
|
||||||
|
Total liabilities and equity
|
$
|
6,055
|
$
|
6,306
|
||||
| Six Months Ended June 30, | ||||||||
|
|
2023
|
2022
|
||||||
|
Cash Flows from Operating Activities:
|
||||||||
|
Net (loss) income
|
$
|
(244
|
)
|
$
|
391
|
|||
|
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
|
||||||||
|
Depreciation, depletion and amortization
|
139
|
135
|
||||||
|
Deferred income taxes
|
310
|
(240
|
)
|
|||||
|
Share-based compensation expense
|
11
|
14
|
||||||
|
Amortization of deferred debt issuance costs and discount on debt
|
4
|
4
|
||||||
|
Loss on extinguishment of debt
|
-
|
21
|
||||||
|
Other non-cash items affecting net (loss) income
|
26
|
22
|
||||||
|
Changes in assets and liabilities:
|
||||||||
|
Increase in accounts receivable, net of allowance for credit losses
|
(1
|
)
|
(21
|
)
|
||||
|
Increase in inventories, net
|
(131
|
)
|
(80
|
)
|
||||
|
Decrease (increase) in prepaid and other assets
|
9
|
(3
|
)
|
|||||
|
(Decrease) increase in accounts payable and accrued liabilities
|
(43
|
)
|
8
|
|||||
|
Net changes in income tax payables and receivables
|
(4
|
)
|
2
|
|||||
|
Changes in other non-current assets and liabilities
|
(19
|
)
|
(32
|
)
|
||||
|
Cash provided by operating activities
|
57
|
221
|
||||||
|
|
||||||||
|
Cash Flows from Investing Activities:
|
||||||||
|
Capital expenditures
|
(148
|
)
|
(202
|
)
|
||||
|
Proceeds from sale of assets
|
3
|
1
|
||||||
|
Cash used in investing activities
|
(145
|
)
|
(201
|
)
|
||||
|
|
||||||||
|
Cash Flows from Financing Activities:
|
||||||||
|
Repayments of short-term debt
|
(50
|
)
|
(15
|
)
|
||||
|
Repayments of long-term debt
|
(9
|
)
|
(507
|
)
|
||||
|
Proceeds from long-term debt
|
-
|
396
|
||||||
|
Proceeds from short-term debt
|
201
|
87
|
||||||
|
Repurchase of common stock
|
-
|
(41
|
)
|
|||||
|
Call premiums paid
|
-
|
(18
|
)
|
|||||
|
Debt issuance costs
|
-
|
(4
|
)
|
|||||
|
Dividends paid
|
(50
|
)
|
(41
|
)
|
||||
|
Cash provided by (used in) financing activities
|
92
|
(143
|
)
|
|||||
|
|
||||||||
|
Effects of exchange rate changes on cash and cash equivalents
|
(1
|
)
|
5
|
|||||
|
|
||||||||
|
Net increase (decrease) in cash and cash equivalents
|
3
|
(118
|
)
|
|||||
|
Cash and cash equivalents at beginning of period
|
164
|
232
|
||||||
|
Cash and cash equivalents at end of period
|
$
|
167
|
$
|
114
|
||||
|
|
Three Months Ended
June 30, |
Six Months Ended
June 30, |
||||||||||||||
|
|
2023
|
2022
|
2023
|
2022
|
||||||||||||
|
|
||||||||||||||||
|
Net (loss) income (U.S. GAAP)
|
$
|
(269
|
)
|
$
|
375
|
$
|
(244
|
)
|
$
|
391
|
||||||
|
Interest expense
|
38
|
28
|
71
|
60
|
||||||||||||
|
Interest income
|
(3
|
)
|
(2
|
)
|
(6
|
)
|
(4
|
)
|
||||||||
|
Income tax provision (benefit)
|
322
|
(223
|
)
|
331
|
(205
|
)
|
||||||||||
|
Depreciation, depletion and amortization expense
|
68
|
67
|
139
|
135
|
||||||||||||
|
EBITDA (non-U.S. GAAP)
|
156
|
245
|
291
|
377
|
||||||||||||
|
Share-based compensation (a)
|
5
|
7
|
11
|
14
|
||||||||||||
|
Venator settlement (b)
|
—
|
—
|
—
|
85
|
||||||||||||
|
Loss on extinguishment of debt (c)
|
—
|
20
|
—
|
21
|
||||||||||||
|
Foreign currency remeasurement (d)
|
(5
|
)
|
(4
|
)
|
(6
|
)
|
4
|
|||||||||
|
Other items (e)
|
12
|
7
|
18
|
14
|
||||||||||||
|
Adjusted EBITDA (non-U.S. GAAP)
|
$
|
168
|
$
|
275
|
$
|
314
|
$
|
515
|
||||||||
|
|
Six Months Ended
June 30, 2023 |
Three Months Ended
March 31, 2023 |
Three Months Ended
June 30, 2023 |
|||||||||
|
Cash provided by operating activities
|
$
|
57
|
$
|
(79
|
)
|
$
|
136
|
|||||
|
Capital expenditures
|
(148
|
)
|
(93
|
)
|
(55
|
)
|
||||||
|
Free cash flow (non-U.S. GAAP)
|
$
|
(91
|
)
|
$
|
(172
|
)
|
$
|
81
|
||||