Venator swings to loss on COVID-19 volume decline

MOSCOW (MRC) — Venator (Wynard, UK) reports a second-quarter loss of USD19 million, down from USD21 million in the year-ago period. Sales totaled USD456 million, down 21% year-over-year (YOY) from USD578 million, said Chemweek.

Economic disruption created by the COVID-19 pandemic cut into volume, but the company was able to keep average pricing stable in the titanium dioxide segment and to increase it in the performance additives segment.

Adjusted earnings per share came to a 3-cent loss, down from a 13-cent profit in the year-ago period and ahead of the average analyst estimate of an 8-cent loss as compiled by Refinitiv (New York).

“Our business performed well in the second quarter notwithstanding the severe headwinds due to the COVID-19 pandemic,” says Simon Turner, president and CEO. “TiO2 volumes declined 16% sequentially, in-line with our expectations. Our average TiO2 price remained stable, consistent with our customer-tailored approach, and our decisive cost actions helped mitigate the acute impact of lower demand.”

Titanium dioxide segment revenue totaled USD338 million, down 23% YOY, mostly the result of a 21% decline in TiO2 sales volume, says Venator, while average selling price was stable. Volume declined in all product categories and regions owing to the impact of COVID-19. Adjusted EBITDA came to USD35 million, down 36% YOY on lower sales volume, partially offset by lower costs.

The performance additives segment turned in revenue of USD118 million, down 15% YOY. A 16% decrease in sales volumes and the unfavorable impacts of product mix and currency translation were partially offset by a 3% increase in average selling price. Venator attributes the volume decline mainly to the effect of COVID-19 on demand in the color pigments and functional additives businesses. Average selling price increased mainly on favorable mix within the color pigments and timber treatment businesses. Adjusted EBITDA was USD13 million, down 19% on lower volume, partially offset by lower costs.

As MRC informed earlier, Venator Materials PLC announced the completion of the strategic review of its Pori, Finland TiO2 manufacturing facility. As a result of unanticipated cost escalation and extended timeline now understood to be associated with the reconstruction of the Pori, Finland TiO2 facility, Venator will transfer certain technology, and the production of select product grades, to other facilities within its current manufacturing network, which will become more efficient with greater flexibility. The Pori, Finland facility will continue to operate at reduced rates through the transition period, which is expected to last through 2021.

As MRC informed earlier, Russia’s output of chemical products rose in June 2020 by 2.6% year on year. However, production of basic chemicals increased year on year by 4.9% in the first six months of 2020. According to the Federal State Statistics Service of the Russian Federation, polymers in primary form accounted for the greatest increase in the output in January-June. Production of benzene was 106,000 tonnes in June 2020, compared to 110,000 tonnes a month earlier. Overall output of this product reached 721,000 tonnes over the stated period, up by 3.9% year on year.

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