The Chemours Co. announced its financial results for the second quarter 2023 paired with the announcement of the closing of the Kuan Yin, Taiwan, titanium dioxide manufacturing facility. Overall, second quarter 2023 net sales of $1.6 billion were 14% lower than the prior-year quarter, driven by lower net sales in titanium technologies (TT) and the advanced materials portfolio.
Second quarter net loss was $376 million, including $644 million of charges related to legal settlements for “forever chemicals” PFAS environmental matters and associated fees, resulting in EPS of $2.52, down from $3.78 the prior-year quarter. Adjusted net income was $167 million or approximately 42% less year-over-year. Adjusted EBITDA for the second quarter of 2023 declined 32% to $324 million, compared to $475 million in the prior-year second quarter, driven primarily by weaker results in TT.
The company announced the decision to close its Kuan Yin manufacturing facility as part of a comprehensive strategy to improve the earnings quality of TT – producers of the popular Ti-Pure™ brand – by optimizing its manufacturing circuit.
“Plant closures are incredibly difficult because of the impact on talented and hard-working people like our Kuan Yin colleagues who have been valued members of our company, as well as their families and the community. We are working closely with local leaders to help with this transition,” said Denise Dignam, president of Chemours Titanium Technologies. “Moving forward, Chemours remains committed to delivering excellent service to our customers and continuing to lead the industry in innovation and sustainability.”
The Kuan Yin site will stop producing dry titanium dioxide pigment on August 1, 2023, and decommissioning will begin immediately. Chemours sales and technical service teams will work with affected customers to maintain uninterrupted supply. The company expects there will be no impact on product or service quality and no supply interruption during this transition.
In the second quarter, TT reported net sales of $707 million, down $261 million, or 27%, from $968 million year-over-year. Price and currency were relatively flat, with the total change driven by a 27% decline in volume. Overall volume decreased due to softer market demand in all regions. Segment adjusted EBITDA was $87 million, down 60% year-over-year, resulting in an adjusted EBITDA margin of 12%.
“Our second quarter performance underscores the strength of our industry-leading businesses despite increasing economic uncertainty. In Thermal & Specialized Solutions, we delivered record net sales and adjusted EBITDA, and in advanced performance materials demonstrated the strength of our performance solutions portfolio achieving double-digit growth,” said Mark Newman, Chemours president and CEO. “As part of our plan to improve the earnings power of our Titanium Technologies segment, we have decided to close our Kuan Yin facility. This action will enable us to optimize our manufacturing circuit without compromising our ability to meet customer demand and deliver significant recurring cost savings starting in the second half of 2023.”
To learn more, visit www.chemours.com.