Chemours impacted by lower refrigerant sales and prices
USA: Lower refrigerant volumes and lower prices have contributed to Chemours suffering a sales drop to $1.3bn in the first quarter of 2020, from $1.4bn in 2019.
While the company experienced higher volume in its titanium dioxide business, this was said to have been more than offset by lower volumes in fluoroproducts and lower global average prices across all segments.
Adjusted EBITDA for the first quarter 2020 was $257m in comparison to $262m in the previous year first quarter, a result of lower F-gas quota sales and prices, partially offset by reduced costs year-over-year.
In addition to refrigerants, Chemours’ fluoroproducts business includes end markets such as fire suppressants, foam blowing agents and Teflon coatings.
Fluoroproducts segment net sales were down 12% to $600m compared to the first quarter of 2019. Chemours blames softer demand primarily driven by the impact of COVID-19 in Asia Pacific and several other global markets. Average price was down 4% on a year-over-year basis. Segment adjusted EBITDA of $140m decreased 12% versus the prior-year quarter, negatively impacted by limited F-gas quota sales due to illegal imports of HFC refrigerants into the EU.
This was partially offset by improved efficiencies from Chemours’ R1234yf refrigerant production facility in Corpus Christi.
“Our Q1 results were consistent with our expectations thanks, in part, to improved operating performance across our network. At the same time, we did begin to feel the early impact of COVID-19 in some areas of the business,” said Chemours president and CEO Mark Vergnano.
All Chemours plants are currently said to be operating with minimal impact from COVID-19.
“We are laser focused on the safety of our employees and the support of our customers,” insisted Mark Vergnano. “I am proud to report that our quick implementation of health screening procedures and procurement of additional protective equipment has allowed us to operate our manufacturing facilities with minimal coronavirus-related disruption.”