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Chemours (CC) Posts Break-Even Q4 Earnings, Sales Miss
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The Chemours Company (CC - Free Report) recorded fourth-quarter 2022 net loss of $97 million or 65 cents per share against the year-ago quarter's earnings of $1.40.
Barring one-time items, CC posted break-even results in the reported quarter. The Zacks Consensus Estimate was pegged at 15 cents.
The company’s net sales in the fourth quarter were $1,388 million, which missed the Zacks Consensus Estimate of $1,422 million. Net sales decreased around 15% from $1,575 million reported in the prior-year quarter.
The company’s results in the fourth quarter were impacted by higher raw material and logistic costs, lower volumes due to demand weakness in Europe and Asia and a stronger U.S. dollar, which offset price increases.
The Chemours Company Price, Consensus and EPS Surprise
The Titanium Technologies (TT) division logged in revenues of $606 million in the quarter, down 30% year over year. Prices in this segment increased 7%, which were mitigated by 35% lower volumes. Volumes were hurt by lower demand, especially in Europe and Asia. Prices rose on the back of contractual price changes.
Revenues in the Thermal & Specialized Solutions (TSS) segment went up 8% year over year to $320 million in the reported quarter. Volumes increased 4% on the continued adoption of Opteon refrigerants. Price contributed 6% to the division’s sales growth. However, price and volumes declined sequentially due to an unfavorable product mix.
Revenues in the Advanced Performance Materials (APM) unit were $382 million, up roughly 10% year over year, driven by growth across key markets. Price contributed 17% to the sales growth. Volumes remained flat in the quarter, partly offset by a 6% currency headwind.
FY22 Results
Earnings for full-year 2022 were $3.65 per share, up from $3.60 a year ago. Net sales went up 7.1% to $6,794 million.
Financials
Chemours ended 2022 with cash and cash equivalents of $1,102 million, down roughly 24.1% year over year. Long-term debt was $3,590 million, down around 3.6%.
Cash provided by operating activities was $754 million in 2022. Free cash flow for the full year was $447 million.
Outlook
Chemours sees adjusted EBITDA in the range of $1.2-$1.3 billion for 2023. The company also expects adjusted earnings per share in the band of $3.8-$4.29 for the year. It expects weak conditions to persist in the first of 2023, with conditions improving in the second half. The company is focused on capitalizing on megatrends underlying its TSS and APM segments, along with improving the earnings profile for its TT segment.
Free cash flow for 2023 is forecast to be more than $350 million.
Price Performance
Shares of Chemours have gained 15.4% in the past year, outperforming the industry’s rise of 8.5%.
Image Source: Zacks Investment Research
Zacks Rank & Key Picks
Chemours currently carries a Zacks Rank #5 (Strong Sell).
Commercial Metals’ shares have gained 55.7% in the past year. The Zacks Consensus Estimate for CMC’s current-year earnings has been revised 22.1% upward in the past 60 days.
The company topped Zacks Consensus Estimate in three of the last fourth quarters. It delivered a trailing four-quarter earnings surprise of 16.7% on average.
Cal-Maine’s shares have gained 26.2% in the past year. The company has an earnings growth rate of 515.8% for the current year. The company topped Zacks Consensus Estimate in three of the last fourth quarters. It delivered a trailing four-quarter earnings surprise of 15.3% on average.
CLW’s shares have gained 14.4% in the past year. The company has an earnings growth rate of 278.6% for the current year.
Clearwater Paper beat Zacks Consensus Estimate in three of the last four quarters. It delivered a trailing four-quarter earnings surprise of 13% on average.
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Chemours (CC) Posts Break-Even Q4 Earnings, Sales Miss
The Chemours Company (CC - Free Report) recorded fourth-quarter 2022 net loss of $97 million or 65 cents per share against the year-ago quarter's earnings of $1.40.
Barring one-time items, CC posted break-even results in the reported quarter. The Zacks Consensus Estimate was pegged at 15 cents.
The company’s net sales in the fourth quarter were $1,388 million, which missed the Zacks Consensus Estimate of $1,422 million. Net sales decreased around 15% from $1,575 million reported in the prior-year quarter.
The company’s results in the fourth quarter were impacted by higher raw material and logistic costs, lower volumes due to demand weakness in Europe and Asia and a stronger U.S. dollar, which offset price increases.
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 (TT) division logged in revenues of $606 million in the quarter, down 30% year over year. Prices in this segment increased 7%, which were mitigated by 35% lower volumes. Volumes were hurt by lower demand, especially in Europe and Asia. Prices rose on the back of contractual price changes.
Revenues in the Thermal & Specialized Solutions (TSS) segment went up 8% year over year to $320 million in the reported quarter. Volumes increased 4% on the continued adoption of Opteon refrigerants. Price contributed 6% to the division’s sales growth. However, price and volumes declined sequentially due to an unfavorable product mix.
Revenues in the Advanced Performance Materials (APM) unit were $382 million, up roughly 10% year over year, driven by growth across key markets. Price contributed 17% to the sales growth. Volumes remained flat in the quarter, partly offset by a 6% currency headwind.
FY22 Results
Earnings for full-year 2022 were $3.65 per share, up from $3.60 a year ago. Net sales went up 7.1% to $6,794 million.
Financials
Chemours ended 2022 with cash and cash equivalents of $1,102 million, down roughly 24.1% year over year. Long-term debt was $3,590 million, down around 3.6%.
Cash provided by operating activities was $754 million in 2022. Free cash flow for the full year was $447 million.
Outlook
Chemours sees adjusted EBITDA in the range of $1.2-$1.3 billion for 2023. The company also expects adjusted earnings per share in the band of $3.8-$4.29 for the year. It expects weak conditions to persist in the first of 2023, with conditions improving in the second half. The company is focused on capitalizing on megatrends underlying its TSS and APM segments, along with improving the earnings profile for its TT segment.
Free cash flow for 2023 is forecast to be more than $350 million.
Price Performance
Shares of Chemours have gained 15.4% in the past year, outperforming the industry’s rise of 8.5%.
Image Source: Zacks Investment Research
Zacks Rank & Key Picks
Chemours currently carries a Zacks Rank #5 (Strong Sell).
Better-ranked stocks to consider in the basic materials space include Commercial Metals Company (CMC - Free Report) , Cal-Maine Foods, Inc. (CALM - Free Report) and Clearwater Paper Corporation (CLW - Free Report) . All three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Commercial Metals’ shares have gained 55.7% in the past year. The Zacks Consensus Estimate for CMC’s current-year earnings has been revised 22.1% upward in the past 60 days.
The company topped Zacks Consensus Estimate in three of the last fourth quarters. It delivered a trailing four-quarter earnings surprise of 16.7% on average.
Cal-Maine’s shares have gained 26.2% in the past year. The company has an earnings growth rate of 515.8% for the current year. The company topped Zacks Consensus Estimate in three of the last fourth quarters. It delivered a trailing four-quarter earnings surprise of 15.3% on average.
CLW’s shares have gained 14.4% in the past year. The company has an earnings growth rate of 278.6% for the current year.
Clearwater Paper beat Zacks Consensus Estimate in three of the last four quarters. It delivered a trailing four-quarter earnings surprise of 13% on average.