Tronox (TROX) Earnings Beat, Revenues Lag Estimates in Q3

Tronox Holdings plc TROX recorded loss from continuing operations (attributable to the company) of $19 million or 13 cents per share in third-quarter 2019 against profits of $6 million or 5 cents per share a year ago.

Barring one-time items, adjusted earnings per share (EPS) for the reported quarter were 21 cents, which surpassed the Zacks Consensus Estimate of 15 cents.

Revenues grew around 68% year over year to $768 million in the reported quarter. The upside can be attributed to higher titanium dioxide (TiO2) pigment sales. However, revenues missed the Zacks Consensus Estimate of $818.7 million.

Product Revenues

Revenues from TiO2 pigment rose 96% year over year to $603 million. Sales included contributions from the acquired operations of Cristal.

Zircon sales declined 6% to $68 million due to weak market conditions.

Feedstock and other products’ sales rose around 45% to $97 million.

Financials

The company ended the quarter with cash and cash equivalents of $305 million, down 71.7% year over year. Long-term debt was $3,067 million, down 2.4% year over year.

Cash provided by operating activities was $237 million for the first nine months of 2019.

Capital expenditure was $140 million for the first nine months of 2019.

Outlook

The company revised its guidance for 2019. It now expects revenues of $2,650-$2,700 million for the year. The company anticipates adjusted EBITDA of $615-$635 million for the year.

It now projects adjusted EPS of 33-44 cents for 2019. The company expects free cash flow of $120-$135 million for the year.

Price Performance

Shares of Tronox have lost 6.8% over a year, outperforming the industry’s 21.5% decline.

 

 

Zacks Rank & Stocks to Consider

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

Some better-ranked stocks in the basic materials space are Impala Platinum Holdings Ltd. IMPUY, Franco-Nevada Corporation FNV and Agnico Eagle Mines Limited AEM, currently flaunting a Zacks Rank #1 (Strong Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.

Impala Platinum has an expected earnings growth rate of 248.3% for the current fiscal year. The company’s shares have surged 264.1% in the past year.

Franco-Nevada has a projected earnings growth rate of 39.3% for 2019. The company’s shares have rallied 50.5% in a year.

Agnico Eagle has an estimated earnings growth rate of 168.6% for the current year. Its shares have moved up 69.6% in the past year.

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