STAMFORD, Conn. - Tronox Holdings plc (NYSE: TROX), a global leader in the production of titanium dioxide pigment, announced preliminary financial results for the first quarter of 2024, revealing higher-than-anticipated revenue and adjusted EBITDA.
The company expects to report a revenue of $774 million for the quarter, marking a 9% increase from the previous year and a 13% rise from the prior quarter. Despite projecting a net loss of $9 million, Tronox anticipates an adjusted EBITDA of $131 million, surpassing the guidance range of $100 to $120 million with an estimated EBITDA margin of around 17%.
CEO John D. Romano attributed the strong performance to a robust market recovery, with demand for titanium dioxide (TiO2) and zircon outstripping expectations. TiO2 volumes rose roughly 18% from the last quarter, while zircon volumes surged by about 54% in the same period. Romano cited improved production absorption and the absence of non-recurring charges as factors contributing to favorable cost trends.
Revenue from TiO2 is expected to reach $605 million, up 8% from the previous year, driven by volume growth. Yet, this was partially offset by a 10% decrease in average selling prices including mix. Zircon revenue is forecasted at $88 million, a 22% increase over the previous year due to a 43% rise in volumes, despite a 21% drop in average selling prices. Other product revenues are set to increase by 7% year-over-year to $81 million.
Tronox's preliminary results are subject to finalization, with full financial details to be discussed in a webcast conference call scheduled for Thursday, May 2, 2024.
The company's performance reflects its position as a vertically integrated portfolio operator in the titanium dioxide industry. The information for this report is based on a press release statement.
InvestingPro Insights
As Tronox Holdings plc (NYSE: TROX) continues to navigate the dynamic market of titanium dioxide pigment production, the company's recent preliminary financial results for Q1 2024 have caught the attention of investors.
With a reported revenue increase and higher-than-anticipated adjusted EBITDA, the company's financial health and future prospects are a focus for stakeholders. Here are some key insights from InvestingPro that may provide a deeper understanding of Tronox's position:
Tronox's market capitalization stands at approximately $2.56 billion, reflecting its significant presence in the industry. Despite the challenges of operating with a significant debt burden, as indicated by one of the InvestingPro Tips, the company's net income is expected to grow this year. This is an encouraging sign for investors who may be weighing the company's growth potential against its financial obligations.
The company's stock has been recognized for its volatility, another tip from InvestingPro, which could be of interest to investors looking for dynamic trading opportunities. Additionally, Tronox has a notable track record of maintaining dividend payments for 13 consecutive years, with a current dividend yield of 3.09%, which may appeal to income-focused investors.
From a valuation perspective, Tronox's P/E ratio is currently negative at -12.61, reflecting the net loss projected in the recent earnings report. Still, analysts predict the company will return to profitability this year, which could lead to a reassessment of the company's valuation multiples. The PEG ratio, which stands at a low 0.08, suggests that the market may be undervaluing the company's growth prospects.
Investors interested in further analysis and additional InvestingPro Tips can find more detailed insights on Tronox at https://www.investing.com/pro/TROX. There are a total of 9 additional tips available, offering a comprehensive look at factors that could influence the company's stock performance. For those considering an InvestingPro subscription, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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