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Chemours (CC) Earnings and Revenues Beat Estimates in Q1

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The Chemours Company (CC - Free Report) posted a profit of $96 million or 57 cents per share in the first quarter of 2021 compared with a profit of $100 million or 61 cents per share in the year-ago quarter.

Adjusted earnings were 71 cents per share for the quarter, which surpassed the Zacks Consensus Estimate of 68 cents.

Net sales increased around 10% year over year to $1,436 million. The top line beat the Zacks Consensus Estimate of $1,383.4 million. Sales for the quarter included an unfavorable 1% portfolio impact from the shutdown of the aniline business.

Sales rose 7% on a sequential-comparison basis as global macroeconomic recovery led to higher sales in the Titanium Technologies, Thermal & Specialized Solutions, Advanced Performance Materials and Chemicals Solutions units.

The Chemours Company Price, Consensus and EPS Surprise

 

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 division raked in revenues of $723 million in the quarter, up around 18% year over year. Volumes rose 16% year over year owing to strong demand in all regions and end-markets, despite challenges in logistics and issues caused by winter storm Uri.

Revenues in the Thermal & Specialized Solutions segment inched down 1% year over year to $304 million in the reported quarter. Volumes increased 4% year over year. The company witnessed higher Opteon volume drive growth in the quarter from improved adoption, but faced headwinds from reduced global auto production.

Revenues in the Advanced Performance Materials unit were $333 million, up around 14% year over year. The increase in year-over-year sales was driven by demand recovery across nearly all end-markets and regions, led by Semiconductors, Electronics, Transportation and Oil &Gas.

The Chemical Solutions unit recorded sales of $76 million, down 17% year over year, impacted by portfolio changes. Glycolic Acid and Vazo volumes dropped year over year due to headwinds faced from logistics and Uri. Mining solutions had strong results, which were offset  by incremental costs associated with Uri.

Financials

Chemours ended the quarter with cash and cash equivalents of $1,008 million, down roughly 8.7% sequentially. Long-term debt was $3,970 million, almost in-line with the previous-quarter’s levels.

Cash provided by operating activities was $39 million at the end of the first quarter, down from $44 million in the prior-year quarter. Free cash flow for the first quarter was negative $21 million compared with negative $62 million in the prior-year quarter.

Outlook

Chemours expects adjusted EBITDA in the band of $1-$1.15 billion in 2021. It also sees adjusted earnings per share of between $2.84 and $3.56 for the year, up from the prior view of $2.40 and $3.12. The company also expects free cash flow of more than $450 million for the year.

Price Performance

Chemours’ shares have surged 155.9% in the past year compared with a 76.1% rise recorded by the industry.

Zacks Rank & Key Picks

Chemours currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks in the basic materials space are Dow Inc. (DOW - Free Report) , Nucor Corporation (NUE - Free Report) and Impala Platinum Holdings Limited (IMPUY - Free Report) .

Dow has a projected earnings growth rate of roughly 261.5% for the current year. The company’s shares have surged 107.2% in a year. It currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Nucor has an expected earnings growth rate of around 228.4% for the current year. The company’s shares have gained 121.4% in the past year. It currently sports a Zacks Rank #1.

Impala has an expected earnings growth rate of 197.6% for the current fiscal. The company’s shares have skyrocketed 230.5% in the past year. It currently flaunts a Zacks Rank #1.

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