Chemours sees Q2 revenue up 15% q/q, implying $1.61B, consensus $1.55B

The company states: “In the second quarter of 2024, the Company expects TT to achieve sequential Net Sales growth of approximately 15%, reflecting the previously communicated improvement in the Company’s TiO2 orderbook. Adjusted EBITDA growth is expected to be generally in-line with the growth in Net Sales, with higher volumes and improved fixed cost absorption, partially offset primarily by the shift in timing of higher-cost ore consumption, much of which is anticipated for the second quarter. In TSS, the Company expects mid-teens sequential growth for both Net Sales and Adjusted EBITDA in the second quarter of 2024, driven by both seasonality and continued adoption of Opteon(TM) products. The projected sequential growth for Adjusted EBITDA incorporates a modest offset from higher input costs from non-Corpus Christi sourced materials to support the transition to Opteon(TM), lower fixed cost absorption on the Company’s legacy refrigerant production, and ongoing investments in next generation refrigerants and immersion cooling. This increased investment, primarily in R&D, is anticipated to be approximately $15 million in 2024. APM expects sequential Net Sales growth in the low-teens, driven by growth in the Performance Solutions product portfolio, paired with a slight improvement in the performance of the Advanced Materials product portfolio, reflecting a modest recovery in end markets. Adjusted EBITDA for the second quarter of 2024 is expected to approach a 30% sequential increase in the APM business, as mix and fixed cost absorption improve with higher volumes. Corporate Expenses, as an offset to Adjusted EBITDA, for the second quarter of 2024 are expected to be higher by approximately $15 million to $20 million sequentially, reflecting a normalization of expenses associated with the Company’s long-term incentive plan and environmental remediation costs. Additionally, the Company anticipates that expenses related to the remediation of material weaknesses in internal controls over financial reporting and other recommendations arising from the Audit Committee’s Internal Review will be relatively flat quarter-over-quarter. The Company expects Operating Cash Flow to reflect a total usage of approximately $500 million in the second quarter of 2024. This projected usage includes an expected outflow of $606 million currently held as restricted cash and restricted cash equivalents, which represents the Company’s prior contribution made in 2023, including interest, to the Water District Settlement Fund. Pursuant to the Settlement Agreement, the Company expects to no longer maintain its reversionary interest in such fund during the second quarter. At the point of the judgment becoming final, this amount currently held as restricted cash and restricted cash equivalents will be derecognized along with the associated accrued liability. Second quarter capital expenditures are expected to be approximately $80 million. For the second quarter of 2024, the Company expects consolidated Net Sales to increase approximately 15% sequentially, with consolidated Adjusted EBITDA also up approximately 15% compared with first quarter 2024 results.”