TheChemours Company, Wilmington, reported strong earnings four the fourth quarter and 2017
Chemours CEOMark Vergnanosaid: “We ended the year with tremendous momentum in all three of our segments, which contributed to a great fourth quarter and an incredible 2017. In Fluoroproducts, the combination of increased adoption of Opteon refrigerants, higher demand for our fluoropolymers, and higher base refrigerant pricing led to significant segment-level growth. Chemical Solutions profitability improved on strong demand in most product lines, which, along with lower costs, more than made up for the impact from the 2016 divestitures and site closure. Finally, we saw customer preference for our Ti-Pure TiO2translate into higher volumes in Titanium Technologies.”
“This positive momentum enabled us to begin executing on our new capital allocation strategy immediately. Following our December investor day throughJanuary 2018, we repurchased approximately$150 millionof shares under our$500 millionshare repurchase authorization, demonstrating our current financial strength and confidence in our future,” commented Vergnano. “We have ample flexibility to continue repurchasing the balance of our shares and pursue accretive growth investments across the company,” Vergnano stated.
Fourth quarter net sales were$1.6 billion, a 19 percent increase from$1.3 billionin the prior-year quarter. Higher prices, primarily for Ti-Pure titanium dioxide, added 10 percent to revenue, while volume across all segments grew revenue by 8 percent. Favorable currency in the quarter resulted in a 2 percent revenue increase.
Fourth quarter net income of$228 millionincreased$458 millionin comparison to last year’s fourth quarter net loss of$230 million. The fourth quarter of 2016 was impacted by the$335 millionlegal settlement charge.
Full-year 2017 net sales were$6.2 billion, a 15 percent increase from$5.4 billionin 2016. Volume growth across all segments, added 11 percent to revenue, driven primarily by the adoption of Opteon refrigerants. Higher prices, primarily for Ti-Pure titanium dioxide, increased revenue by an additional 8 percent.
Full-year 2017 net income of$746 millionincreased$739 millionin comparison to net income of$7 millionin the prior year.
The company now expects a moderately lower effective tax rate going forward, due to a recent reduction in corporate taxes. The company has been paying low tax rates, due to previous losses.
The company expects to deliver 2018 Adjusted EBITDA (earnings before interest, taxes, and depreciation) within a range of$1.7 to $1.85 billion, a 25 percent increase at the midpoint over 2017. Also, the company anticipates Free Cash Flow to benefit from the recent US tax reform Free Cash Flow is expected to be greater than$600 million.
The report made no mention of water issues related to chemical traces found in rivers in North Carolina, home of a Chemours site.