A management shake-up at Wilmington-based Chemours Co. and another delay in reporting earnings were announced on Thursday night.
The Board of Directors of Chemours appointed Denise Dignam as the Interim Chief Executive Officer and Matt Abbott as the Interim Chief Financial Officer (principal financial and accounting officer.
It follows an earlier delay in the reporting of financial results.
Chemours’ stock price fell by nearly 40% in Thursday trading.
Dignam joined Chemours in 2015 and has served as President – Titanium Technologies since March 2023 and previously served as President – Advanced Performance Materials from 2021 to 2023. She served as Vice President of Global Operations – Fluoroproducts, from 2019 to 2021; Global Senior Business Director – Fluoropolymers, from 2016 to 2019; and North American Business Director – Diversified Technologies and Industrial Resins, from 2015 to 2016. Dignam previously worked at DuPont Co. in a number of roles.
Abbott has served as Senior Vice President & Chief Enterprise Transformation Officer, responsible for Enterprise Capital Projects and Engineering Technology, Information Technology, Cyber Security, Digital and Data Analytics, and Procurement, since June 2023.
Abbott previously served as Chemours’ Vice President, Digital and Data Analytics Leader from 2021 to 2023 where he played a key role in designing digital strategies to accelerate Chemours becoming a data-driven organization. Past roles at Chemours included Vice President, Chief Accounting Officer and Controller from 2019 to 2021; and Vice President and Chief Audit Executive from 2017 to 2019. Before, joining Chemours, Abbott was a Partner at PricewaterhouseCoopers LLP for five years, with nearly 20 years of experience serving PwC’s industrial products and high-technology clients.
Board Chair Dawn Farrell said “We are fortunate to have two very experienced and capable leaders in our ranks to step up and fill these roles. Denise is highly regarded by the Board of Directors for the work she’s done in leading both of our Titanium Technologies and Advanced Performance Materials businesses. These businesses combined were more than 68% of our Net Sales in 2023.”
The actions follow the decision of the board to replace CEO Mark Newman, Senior Vice President and Chief Financial Officer Jonathan Lock, and Vice President, Controller and Principal Accounting Officer Camela Wisel on administrative leave.
The actions come before the completion of an internal review being overseen by the Audit Committee of the Board of Directors with the assistance of independent outside counsel. The scope of the work includes the processes for reviewing reports made to the Chemours Ethics Hotline, the Company’s practices for managing working capital, including the related impact on metrics within the company’s incentive plans, certain non-GAAP metrics included in filings made with the Securities and Exchange Commission or otherwise publicly released, and related disclosures, according to a release.
“The company is evaluating one or more potential material weaknesses in its internal control over financial reporting as of December 31, 2023 with respect to maintaining effective controls related to the control environment, including the effectiveness of the “tone at the top” set by certain members of senior management and information and communication components of the COSO internal control framework,” the release added.
The company expects to report on any material weaknesses as of December 31, 2023 and related remediation efforts in its Annual Report on Form 10-K.
Chemours previously stated that it expected to issue its fourth quarter and full year 2023 financial results after market close on February 28, 2024, and to file its Annual Report on Form 10-K for the year ended December 31, 2023 on February 29, 2024.
The company reported that it needs additional time to complete its year-end reporting process, including its review of internal control over financial reporting as of December 31, 2023, and for the Audit Committee of the Board of Directors to complete the internal review.
As a result, Chemours will delay its earnings release and conference call for fourth quarter and full year 2023 financial results, as well as the filing of its annual report on Form 10-K for the year. An annoucement will be made regarding the final earnings release.
Chemours did report the following preliminary financial information.
The Company expects to report net sales of approximately $6 billion for the year ending December 31, 2023, compared to net sales of $6.8 billion for the year ending Dec. 31, 2022. The expected decrease was primarily attributable to lower volumes in Titanium Technologies and in Advanced Performance Materials’ Advanced Materials portfolio, partially offset by increased pricing and volumes in Thermal & Specialized Solutions.
Chemours expects to report net loss attributable to Chemours for the year ended December 31, 2023 within a range of $ 225 million to $235 million, compared to net income attributable to Chemours for the year ended December 31, 2022 of $578 million. The estimated net loss for the year ended December 31, 2023 includes $746 million of pre-tax litigation settlements and $153 million of restructuring, asset-related, and other charges, offset by a $106 million net pre-tax gain associated with the 2023 sale of the Glycolic Acid business.
At December 31, 2023, Chemours maintained cash and cash equivalents of $1.2 billion. They also have restricted cash and restricted cash equivalents of $604 million, primarily relating to the U.S. public water district settlement.
All financial results as of and for the year ended December 31, 2023, are preliminary, are based upon estimates which the company believes are reasonable, are unaudited by the company’s independent registered public accounting firm, and may be subject to change after the completion of the year-end reporting process and will not be final until the company files its audited financial statements in its annual report, according to a release.
