Tronox Reports First Quarter 2023 Financial Results


First quarter results exceeded expectations

STAMFORD, Conn., April 26, 2023 /PRNewswire/ — Tronox Holdings plc (NYSE:TROX) (“Tronox” or the “Company”), the world’s leading integrated manufacturer of titanium dioxide (“TiO2“) pigment, today reported its financial results for the quarter ending March 31, 2023, as follows: 

First Quarter 2023 Financial Highlights:

  • Produced revenue of $708 million, a decrease of 27% compared to the prior year
  • Generated income from operations of $62 million and net income of $25 million
  • Achieved GAAP diluted EPS of $0.15; adjusted diluted EPS of $0.15 (non-GAAP)
  • Delivered Adjusted EBITDA of $146 million, and an Adjusted EBITDA margin of 20.6%
  • Invested $93 million in capital expenditures, primarily in our vertical integration and newTRON initiatives

Q2 2023 Outlook:

  • TiO2 volumes expected to increase in the mid- to high-teens range compared to the first quarter 2023
  • Adjusted EBITDA expected to be $160-170 million

This outlook is based on Tronox’s views on current global economic activity and is subject to changes and impacts associated with the macroeconomic conditions, global supply chain, and inflation-related challenges, among others.

Note: For the Company’s guidance with respect to second quarter 2023 non-GAAP measures, we are not able to provide without unreasonable effort the most directly comparable GAAP financial measure, or reconciliation to such GAAP financial measure, because certain items that impact such measures are uncertain, out of the Company’s control or cannot be reasonably predicted.

Summary of Select Financial Results for the Quarter Ending March 31, 2023

($M unless otherwise noted)Q1 2023Q1 2022Y-o-Y % ∆Q4 2022Q-o-Q % ∆
Revenue$708$965(27) %$6499 %
TiO2$560$773(28) %$47817 %
Zircon$72$108(33) %$91(21) %
Feedstock and other products$76$84(10) %$80(5) %
Income from operations$62$69(10) %$3672 %
Net Income (Loss)$25$1656 %($14)n/m
Net Income (Loss) attributable to Tronox$23$1644 %($15)n/m
GAAP diluted earnings (loss) per share$0.15$0.1050 %($0.09)n/m
Adjusted diluted earnings (loss) per share$0.15$0.60(75) %($0.17)n/m
Adjusted EBITDA$146$240(39) %$11329 %
Adjusted EBITDA Margin %20.6 %24.9 %       (430) bps17.4 %         320 bps
Free cash flow($172)$86(300) %$126(237) %
Y-o-Y % ∆Q-o-Q % ∆
TiO2(30) %3 %(1) %14 %1 %2 %
Zircon(43) %10 %— %(21) %— %— %

Co-CEOs’ Remarks

“While this quarter continued to be challenged by softer end-market demand compared to the prior year, we delivered a stronger quarter than expected,” commented John D. Romano, co-chief executive officer. “Sequentially, TiO2 volumes improved 14%, within the previously guided range, and average selling prices improved 1% compared to the prior quarter, or 3% compared to the prior year, despite 30% lower volumes year-on-year. Adjusted EBITDA was $146 million in the quarter, exceeding the top end of our guided range by $16 million, primarily due to favorable exchange rates compared to our forecast, prudent cost and discretionary spend management and lower costs on the volumes sold in the quarter. Tronox’s first quarter financial results are a demonstration of the strength and advantages of our vertically integrated portfolio. Through our investments in vertical integration, we are able to realize a cost advantage and security of supply that is a key differentiator for Tronox.  Additionally, we continue to deliver against our commercial strategy and realize favorable pricing trends despite the macro backdrop. I am proud of the Tronox team’s dedication and commitment.”

Mr. Romano continued, “Looking ahead, we expect second quarter pigment volumes to increase in the mid- to high-teens range compared to first quarter 2023, driven by continued demand improvement across all regions.”

Jean-François Turgeon, co-chief executive officer, added, “We continue to focus on managing our costs while utilizing the numerous levers we have available to optimize performance and adapt to market conditions. We are happy to report that our upgrading operations at KZN in South Africa are back to full utilization levels following the fire in the fourth quarter that impacted production rates. Additionally, our Atlas mining operations in Australia are also up and running. We are continuing to work with the local authorities towards being able to utilize the primary roads for hauling material offsite, which we anticipate will occur mid-2023. For the second quarter 2023, we anticipate generating an Adjusted EBITDA of $160-170 million, primarily as a result of improved TiO2 and zircon volumes, partially offset by unfavorable product mix impacts and higher costs at our mining sites including increased energy costs in South Africa and higher hauling costs in Australia. We will continue to balance cash generation while ensuring we have the product necessary to meet our customers’ needs and are effectively positioning Tronox for future success.”

First Quarter 2023 Results
(Comparisons are to prior year (Q1 2023 vs. Q1 2022) unless otherwise noted)

The Company recorded first quarter revenue of $708 million, a decrease of 27%, primarily driven by lower sales volumes. Revenue from TiO2 sales was $560 million, a decline of 28% driven by a 30% decline in volumes, a 3% increase in average selling prices and a 1% decrease due to exchange rates. Sequentially, TiO2 sales increased 17%, driven by a 14% increase in sales volumes, a 1% increase in average selling prices and a 2% increase due to exchange rates.

Zircon revenue decreased 33% to $72 million driven by a 43% decline in volumes, partially offset by a 10% increase in average selling prices. Sequentially, zircon revenue decreased 21%, driven by a 21% decrease in volumes while average selling prices remained level.

Revenue from other products was $76 million, a decline of 10% year-over-year and 5% sequentially, primarily driven by lower pig iron volumes and average selling prices. Partially offsetting the lower pig iron sales were sales of rare earth elements, which increased 62% year-over-year.

Net income attributable to Tronox in the quarter of $23 million, or $0.15 per diluted share, compared to net income attributable to Tronox of $16 million, or $0.10 per diluted share in the year-ago period. Excluding non-recurring adjustments totaling $1 million, adjusted net income attributable to Tronox (non-GAAP) was $24 million, or $0.15 per diluted share.

Adjusted EBITDA of $146 million represented a 39% decrease compared to the first quarter 2022, driven by unfavorable fixed cost absorption due to lower production rates, higher process chemical costs, higher mining site costs, and lower sales volumes, partially offset by improved pricing, favorable exchange rates, and lower freight costs. Adjusted EBITDA margin was 20.6% for the quarter.

Sequentially, Adjusted EBITDA increased 29% due to improved freight and corporate costs, the roll-off of lower cost or market and other abnormal charges from the fourth quarter, higher sales volumes and improved product mix, and improved pricing, partially offset by exchange rate headwinds.

The Company’s selling, general and administrative expenses were $71 million in the quarter, a decrease of 9%. Tronox’s first quarter net interest expense was $30 million. Depreciation, depletion and amortization expense was $71 million.

Balance Sheet, Cash Flow and Capital Allocation

Tronox ended the quarter with $2.7 billion of total debt and a net leverage ratio of 3.3x on a trailing twelve-month basis. Available liquidity at the end of the quarter totaled $432 million, including $115 million in cash and cash equivalents and $317 million available under our revolving credit agreements. There are no significant debt maturities until 2028 and no financial covenants on the Company’s term loans or bonds.

Free cash flow for the quarter was a use of $172 million primarily due to higher working capital needs including increased inventories inclusive of purchases of Jazan slag, higher accounts receivable driven by improved sales and lower accounts payable. Capital expenditures were $93 million, including investments in the Company’s key capital initiatives, such as newTRON, the Company’s global business transformation project to improve, automate and digitize, and vertical integration projects to sustain Tronox’s internalization of feedstocks and associated cost advantages. These investments are expected to generate returns significantly above the Company’s cost of capital and sustain Tronox’s position as a leading low-cost producer.


In an effort to create a more centralized approach to communication of the Company’s sustainability efforts, the Company appointed Jennifer Guenther to the role of Chief Sustainability Officer, and Head of Investor Relations and Financial Planning. Mr. Turgeon commented, “We are relentlessly focused on  sustainability at Tronox, and this area is becoming an increasingly significant focal point for our investors, customers and other key stakeholders. Having Jennifer lead these efforts will provide greater insight externally into the exciting ongoing work around ESG and ensure our efforts continue to align Tronox towards a more profitable and sustainable future, as we believe these two go hand in hand.”

Additionally, the Company will be publishing its 2022 Sustainability Report in May 2023. This report will reinforce the previously disclosed path to carbon neutrality by 2050. This year, the Company is also committing for the first time to targets to reduce scope 3 emissions intensity by 9% by 2025 and 16% by 2030 against a 2021 baseline. Mr. Turgeon added, “We are excited about the continued progress we make each year to become more fully aligned with the expectations of our key stakeholders.”

Webcast Conference Call

Tronox will conduct a webcast conference call on Thursday, April 27, 2023, at 8:00 a.m. ET (New York).  The live call is open to the public via internet broadcast and telephone.

Internet Broadcast: 
Dial-in Telephone Numbers:
United States: +1 (833) 470-1428
International: 001 404 975 4839 
Access code: 614920

Conference Call Presentation Slides will be used during the conference call and will be available on our website:

Conference Call Replay: Available via the internet and telephone beginning on April 27, 2023, by
11:00 a.m. ET, until May 4, 2023, 11:59 p.m. ET.

Internet Replay:
Replay Dial-in Telephone Numbers:
United States: +1 (866) 813-9403   
International: 001 929 458 6194  
Replay Access Code: 358146

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Titanium Dioxide

Panzhihua Haifengxin has developed a range of tio2 pigment which is client-oriented and aims to address customer needs in the fields of coating, ink, plastic, paper, and so on.

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