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Chemours (CC) Earnings Miss, Revenues Beat Estimates in Q2
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The Chemours Company (CC - Free Report) logged profits of $70 million or 46 cents per share in second-quarter 2024. This compares to a loss of $376 million or $2.52 in the year-ago quarter.
Barring one-time items, earnings came in at 38 cents. It missed the Zacks Consensus Estimate of 66 cents.
The company reported net sales of $1,538 million in the first quarter, down nearly 6.4% year over year and beating the Zacks Consensus Estimate of $1,537.9. This downside reflected a 1% increase in volume, offset by a 6% decline in price — with portfolio and currency impacts each posing a slight 1% headwind.
The Chemours Company Price, Consensus and EPS Surprise
The Titanium Technologies division recorded revenues of $673 million for the quarter, reflecting a 5% decline compared to the previous year. This was below our estimate of $680.1 million. This decrease in net sales was driven by a 7% decline in price and a 1% impact from currency fluctuations, partially offset by a 3% increase in volume.
In the Thermal & Specialized Solutions segment, revenues experienced a 2% year-over-year decline, reaching $513 million in the reported quarter. This was below our estimate of $523.3 million. The downside was mainly due to a 4% drop in price, partially offset by a 2% increase in volume, with the currency impact remaining flat.
Revenues in the Advanced Performance Materials unit amounted to $339 million, down 12% year over year. It was above our estimate of $336.9 million. The downtick was primarily caused by reductions in price, volume and currency of 7%, 4% and 1%, respectively.
Financials
Chemours ended the quarter with cash and cash equivalents of $604 million, down around 36% year over year. Long-term debt was $3,951 million, up roughly 10% year over year.
Cash used in operating activities was $620 million in the reported quarter.
Outlook
CC forecasts a low to mid-single-digit sequential decline in net sales for the third quarter, primarily due to the continued effects of the unplanned downtime at its Altamira, Mexico manufacturing site in TT during the second quarter. The downtick is also influenced by seasonal fluctuations in refrigerant demand and weaker Freon refrigerants pricing in TSS as well as a modest recovery in APM. Despite these challenges, the company projects continued strong adoption of Opteon refrigerants, anticipating double-digit year-over-year growth, along with robust year-over-year performance in APM's Performance Solutions portfolio.
In addition, the company expects a high-single-digit sequential decline in Adjusted EBITDA for the third quarter, which reflects $15-$20 million in costs related to the unplanned shutdown at Altamira. However, corporate expenses are anticipated to fall sequentially as efforts around controls remediation continue, with the majority of these costs concentrated in the first half of the year.
Price Performance
Shares of Chemours are down 43.8% in the past year compared with the industry’s fall of 9%.
Image Source: Zacks Investment Research
Zacks Rank & Key Picks
Chemours currently carries a Zacks Rank #5 (Strong Sell).
The Zacks Consensus Estimate for Hecla's current-year earnings is pegged at 5 cents, indicating a rise of 600% from year-ago levels. The consensus estimate for HL’s earnings has increased 25% in the past 60 days. It will report second-quarter results on Aug 6.
The Zacks Consensus Estimate for FNV’s current-year earnings is pegged at $3.27. The consensus estimate for FNV’s earnings has increased by 3% in the past 60 days. FNV beat the consensus estimate in the last four quarters, with the average earnings surprise being 10.5%. It is scheduled to release second-quarter results on Aug 13.
The Zacks Consensus Estimate for ASH’s current-year earnings is pegged at $4.56, indicating a year-over-year rise of 12%. ASH’s earnings beat the Zacks Consensus Estimate in three of the last four quarters while matching it once, the average earnings surprise being 5.8%. The company’s shares have increased 1% in the past year. It is slated to report fiscal third-quarter results on Aug 6.
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Chemours (CC) Earnings Miss, Revenues Beat Estimates in Q2
The Chemours Company (CC - Free Report) logged profits of $70 million or 46 cents per share in second-quarter 2024. This compares to a loss of $376 million or $2.52 in the year-ago quarter.
Barring one-time items, earnings came in at 38 cents. It missed the Zacks Consensus Estimate of 66 cents.
The company reported net sales of $1,538 million in the first quarter, down nearly 6.4% year over year and beating the Zacks Consensus Estimate of $1,537.9. This downside reflected a 1% increase in volume, offset by a 6% decline in price — with portfolio and currency impacts each posing a slight 1% headwind.
The Chemours Company Price, Consensus and EPS Surprise
The Chemours Company price-consensus-eps-surprise-chart | The Chemours Company Quote
Segment Highlights
The Titanium Technologies division recorded revenues of $673 million for the quarter, reflecting a 5% decline compared to the previous year. This was below our estimate of $680.1 million. This decrease in net sales was driven by a 7% decline in price and a 1% impact from currency fluctuations, partially offset by a 3% increase in volume.
In the Thermal & Specialized Solutions segment, revenues experienced a 2% year-over-year decline, reaching $513 million in the reported quarter. This was below our estimate of $523.3 million. The downside was mainly due to a 4% drop in price, partially offset by a 2% increase in volume, with the currency impact remaining flat.
Revenues in the Advanced Performance Materials unit amounted to $339 million, down 12% year over year. It was above our estimate of $336.9 million. The downtick was primarily caused by reductions in price, volume and currency of 7%, 4% and 1%, respectively.
Financials
Chemours ended the quarter with cash and cash equivalents of $604 million, down around 36% year over year. Long-term debt was $3,951 million, up roughly 10% year over year.
Cash used in operating activities was $620 million in the reported quarter.
Outlook
CC forecasts a low to mid-single-digit sequential decline in net sales for the third quarter, primarily due to the continued effects of the unplanned downtime at its Altamira, Mexico manufacturing site in TT during the second quarter. The downtick is also influenced by seasonal fluctuations in refrigerant demand and weaker Freon refrigerants pricing in TSS as well as a modest recovery in APM. Despite these challenges, the company projects continued strong adoption of Opteon refrigerants, anticipating double-digit year-over-year growth, along with robust year-over-year performance in APM's Performance Solutions portfolio.
In addition, the company expects a high-single-digit sequential decline in Adjusted EBITDA for the third quarter, which reflects $15-$20 million in costs related to the unplanned shutdown at Altamira. However, corporate expenses are anticipated to fall sequentially as efforts around controls remediation continue, with the majority of these costs concentrated in the first half of the year.
Price Performance
Shares of Chemours are down 43.8% in the past year compared with the industry’s fall of 9%.
Image Source: Zacks Investment Research
Zacks Rank & Key Picks
Chemours currently carries a Zacks Rank #5 (Strong Sell).
Some better-ranked stocks in the Basic Materials space are Hecla Mining Company (HL - Free Report) , Franco-Nevada Corporation (FNV - Free Report) and Ashland Inc. (ASH - Free Report) . Hecla and Franco-Nevada sport a Zacks Rank #1 (Strong Buy) and Ashland carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Hecla's current-year earnings is pegged at 5 cents, indicating a rise of 600% from year-ago levels. The consensus estimate for HL’s earnings has increased 25% in the past 60 days. It will report second-quarter results on Aug 6.
The Zacks Consensus Estimate for FNV’s current-year earnings is pegged at $3.27. The consensus estimate for FNV’s earnings has increased by 3% in the past 60 days. FNV beat the consensus estimate in the last four quarters, with the average earnings surprise being 10.5%. It is scheduled to release second-quarter results on Aug 13.
The Zacks Consensus Estimate for ASH’s current-year earnings is pegged at $4.56, indicating a year-over-year rise of 12%. ASH’s earnings beat the Zacks Consensus Estimate in three of the last four quarters while matching it once, the average earnings surprise being 5.8%. The company’s shares have increased 1% in the past year. It is slated to report fiscal third-quarter results on Aug 6.