Tronox Holdings PLC (TROX) 2023 Q4 法說會逐字稿

Good morning, ladies and gentlemen, and welcome to the Tronox Holdings Q4 2023 earnings call. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question and answer session. If at any time during this call you require media assistance, please press star zero for the operator. I will now turn the call over to Jennifer Gunther, Chief Sustainability Officer and Head of Investor Relations. Please go ahead.

早安，女士們、先生們，歡迎參加 Tronox Holdings 2023 年第四季財報電話會議。此時，所有線路均處於僅監聽模式。演講結束後，我們將進行問答環節。如果在此通話期間您隨時需要媒體協助，請按下接線員的星號零。我現在將把電話轉給首席永續發展長兼投資者關係主管 Jennifer Gunther。請繼續。

Thank you, and welcome to our fourth quarter and full year 2023 Conference Call and Webcast. Turning to slide 2 on our call today are John Romano and Jean-François Turgeon, Co-Chief Executive Officers, and John Stinebaugh, Senior Vice President and Chief Financial Officer. We will be using slides as we move through today's call. You can access the presentation on our website at investor dot Tronox.com. Moving to slide 3, a friendly reminder that comments made on this call and the information provided in our presentation and on our website include certain statements that are forward-looking and subject to various risks and uncertainties, including but not limited to the specific factors summarized in our SEC filings. This information represents our best judgment based on what we know today. However, actual results may vary based on these risks and uncertainties. The company undertakes no obligation to update or revise any forward-looking statements during the conference call, we will refer to certain non-US GAAP financial terms that we use in the management of our business and believe are useful to investors in evaluating the Company's performance Reconciliations to their nearest U.S. GAAP terms are provided in our earnings release and in the appendix of the accompanying presentation. Additionally, please note that all financial comparisons made during the call are on a year-over-year basis unless otherwise noted.

謝謝，歡迎參加我們的 2023 年第四季和全年電話會議和網路廣播。在我們今天的電話會議上，請看投影片 2：共同執行長 John Romano 和 Jean-François Turgeon，以及資深副總裁兼財務長 John Stinebaugh。我們將在今天的電話會議中使用幻燈片。您可以在我們的投資者網站 Tronox.com 上存取簡報。前往投影片3，友情提醒，對本次電話會議的評論以及我們的簡報和網站上提供的資訊包括某些前瞻性陳述，並受到各種風險和不確定性的影響，包括但不限於總結的具體因素在我們向 SEC 提交的文件中。這些資訊代表了我們根據目前所知的最佳判斷。然而，實際結果可能會因這些風險和不確定性而有所不同。本公司不承擔在電話會議期間更新或修改任何前瞻性陳述的義務，我們將參考我們在業務管理中使用的某些非美國公認會計準則財務術語，並認為這些術語對投資者評估公司業績有用我們的收益報告和隨附簡報的附錄中提供了與最接近的美國公認會計準則條款的調節。此外，請注意，除非另有說明，否則電話會議期間進行的所有財務比較都是逐年進行的。

It is now my pleasure to turn the call over to John Romano. John?

現在我很高興將電話轉給約翰羅馬諾。約翰？

Thanks, Jennifer, and good morning, everyone. We'll begin this morning on slide 5 with some key messages from the quarter, we delivered fourth quarter top line performance in line with expectations. Tio2 sales volumes declined approximately 4% in the quarter compared to the third quarter, volumes were slightly lower than expected due to more seasonality in North America than anticipated, and we also experienced some shipment delays as a result of congestion in the Red Sea that delayed some stock transfers to cover our Botlek outage in Europe, our TiO2 pricing was only down 1% compared to the third quarter, which was better than our previous guide, our zircon volumes increased 82% versus the third quarter, higher than expected and communicated on our last earnings call. However, we did experience some unfavorable product and regional mix, which negatively impacted our margin in the quarter. Zircon pricing was down 9% compared to the third quarter due to product mix and some regional pricing adjustments primarily in Asia Pacific revenue was also higher from other products due to additional sales of pig iron as well as opportunistic sales of ilmenite and a portion of our Rare Earths tailing deposit in South Africa, which is a key part of our funding strategy for our railroad business. Our adjusted EBITDA for the fourth quarter came in $11 million below our guided range. This was primarily driven by a delayed restart of our steam supplier at Botlek and higher costs from unanticipated downtime stemming from running at lower rates. While the bottleneck situation is now under control and our suppliers back up and running, we saw approximately $10 million more in costs than forecasted due to the lumber downtime. Importantly, our supplier outage did not address disrupt our ability to fulfill customer demand as we were able to reposition inventory from our other global assets to meet customer demand.

謝謝，詹妮弗，大家早安。我們將從今天早上的幻燈片 5 開始，介紹本季度的一些關鍵信息，我們交付的第四季度營收業績符合預期。與第三季度相比，本季度二氧化鈦銷量下降了約 4%，由於北美的季節性因素比預期更多，銷量略低於預期，並且由於紅海擁堵導致延遲，我們還經歷了一些發貨延遲一些庫存轉移以彌補我們在歐洲的Botlek 停電，我們的TiO2 定價與第三季度相比僅下降了1%，這比我們之前的指導要好，我們的鋯石銷量比第三季度增加了82%，高於預期並在我們上次的財報電話會議。然而，我們確實經歷了一些不利的產品和區域組合，這對我們本季的利潤率產生了負面影響。由於產品組合和一些區域定價調整（主要是亞太地區），鋯石價格較第三季下降9%，由於生鐵的額外銷售以及鈦鐵礦和部分產品的機會性銷售，其他產品的收入也較高。南非的稀土尾礦床是我們鐵路業務融資策略的關鍵部分。我們在第四季度調整後的 EBITDA 比我們的指導範圍低 1100 萬美元。這主要是由於我們在博特萊克的蒸汽供應商延遲重新啟動，以及由於較低的運行率導致的意外停機導致成本上升。雖然瓶頸情況現已控制，我們的供應商也已恢復正常運行，但由於木材停工，我們發現成本比預期高出約 1000 萬美元。重要的是，我們的供應商中斷並沒有解決我們滿足客戶需求的能力中斷的問題，因為我們能夠重新配置其他全球資產的庫存以滿足客戶需求。

In Europe, we expect to recover at least $15 million in insurance proceeds in 2024 as a result of the downtime at public in the second half of 2023. This amount represents the costs incurred to continue to provide uninterrupted service to our customers while working around the supplier outage. The operating challenges we experienced in the last six months are not indicative of the standard we hold ourselves to at Tronox, and we're addressing these challenges head-on in 2024. In 2023, we ran at the lowest utilization rate rates on record in order to manage inventories and free cash flow in light of the lower market demand.

在歐洲，由於 2023 年下半年公共服務中斷，我們預計 2024 年將收回至少 1,500 萬美元的保險收益。此金額代表在解決供應商中斷問題時繼續為客戶提供不間斷服務所產生的成本。我們在過去六個月中遇到的營運挑戰並不代表我們在 Tronox 所堅持的標準，我們將在 2024 年正面應對這些挑戰。2023 年，我們以有史以來最低的利用率運行，以便根據較低的市場需求來管理庫存和自由現金流。

As we look into 2024, we're adjusting our operating rates to support the market recovery currently underway. This will set Tronox up to realize a step change in earnings power after we work through the remaining high-cost inventory on the balance sheet, our free cash flow for the quarter came in higher than expected at $51 million despite the lower than forecasted earnings owing to our cash management initiatives, we saw positive inflow of nearly $60 million from working capital quarter. I'll let John run through more of the year-end numbers up from the balance sheet, but we're very comfortable with where we are from a liquidity and debt position despite the lower market demand we took action at the right time in 2023 to bolster the balance sheet and ensure we had sufficient liquidity. I'm proud of our team at how our team has proactively prepared for a variety of scenarios. And Tronox is very well-positioned as we stand today, especially considering the key capital projects we plan for 2024, which we'll discuss a little bit later on the call.

展望 2024 年，我們正在調整開工率，以支持目前正在進行的市場復甦。這將使 Tronox 在我們處理完資產負債表上剩餘的高成本庫存後實現盈利能力的階躍變化，儘管我們的盈利低於預期，但本季度的自由現金流仍高於預期，達到 5100 萬美元對於我們的現金管理計劃，我們看到營運資金季度正流入近6,000 萬美元。我會讓約翰從資產負債表上看更多的年終數據，但我們對流動性和債務狀況感到非常滿意，儘管市場需求較低，但我們在 2023 年的正確時間採取了行動以加強資產負債表並確保我們有足夠的流動性。我為我們的團隊感到自豪，因為我們的團隊為各種場景做好了積極的準備。從我們今天的立場來看，Tronox 處於非常有利的地位，特別是考慮到我們計劃的 2024 年關鍵資本項目，我們將在稍後的電話會議上討論這些項目。

Turning to slide 6, I'll now review a few updates on some of the key sustainability initiatives. We are nearing the conversion of 40% of our power in South Africa to power from the significant solar project we helped develop in partnership with the Solar Group. This project is one of South Africa's largest solar installations. We expect to receive power in the coming months, which will significantly reduce our carbon emissions globally and marked the first significant step on our journey to net zero in 2050.

轉到投影片 6，我現在將回顧一些關鍵永續發展舉措的一些更新。我們即將將南非 40% 的電力轉換為我們與 Solar Group 合作開發的重要太陽能專案的電力。該項目是南非最大的太陽能裝置之一。我們預計將在未來幾個月內獲得電力，這將顯著減少我們在全球範圍內的碳排放，並標誌著我們在 2050 年實現淨零排放的道路上邁出了重要的第一步。

Renewable power and energy efficiency projects are key to achieving our 2030 greenhouse gas emissions reductions target of 50%. So we're excited to Mark such a significant milestone. We have another renewable project in development in South Africa that we hope to provide more details on soon also underway our various initiatives to achieve our stated targets towards reducing our waste to extract external landfills. This includes exploring alternative uses for waste in a number of opportunities, including cement road base bricks and water treatment chemicals. We are also continuing to evaluate opportunities to extract valuable minerals and metals from waste, including rare earths, Skandia and vanadium. We're excited about the progress we've made and look forward to continuing to updating you on our journey.

再生能源和能源效率專案是實現 2030 年溫室氣體減量 50% 目標的關鍵。因此，我們很高興能夠實現這樣一個重要的里程碑。我們在南非正在開發另一個可再生能源項目，我們希望很快能提供更多有關該項目的更多詳細信息，該項目也正在進行我們的各種舉措，以實現我們既定的目標，即減少提取外部垃圾掩埋場的廢棄物。這包括在許多機會中探索廢物的替代用途，包括水泥路基磚和水處理化學物質。我們也持續評估從廢物中提取有價值的礦物和金屬的機會，包括稀土、斯坎迪亞和釩。我們對所取得的進展感到興奮，並期待繼續向您通報我們的最新進展。

I'll now turn the call over to Jean to review some of our financials for the quarter in more detail. Jean?

我現在將把電話轉給吉恩，以更詳細地審查我們本季的一些財務狀況。讓？

Thank you, John. Turning to slide 7, revenue of $686 million increased 6% compared to the prior year, primarily from TiO2 and other product sales. This represented an increase of 4% relative to the prior quarter due to higher zircon and other product sales income from operations was $8 million. In the quarter, we reported a net loss of $56 million. Our effective tax rate in the quarter was 75%, despite generating a loss before income taxes. We paid $24 million in taxes in the quarter as the majority of our taxes are paid in South Africa, where we had higher earnings than expected owing to higher zircon sales and the sale of a portion of our rare earth tailing deposit in the majority of our other jurisdictions. We either realize a net loss or have NOL positions. As a result, our adjusted diluted earnings per share was a loss of $0.38. As previously discussed, our adjusted EBITDA in the quarter was $94 million and our adjusted EBITDA margin was 13.7% and free cash flow generated in the quarter was $51 million.

謝謝你，約翰。轉向幻燈片 7，營收為 6.86 億美元，比上年增長 6%，主要來自 TiO2 和其他產品銷售。由於鋯石和其他產品業務銷售收入增加至 800 萬美元，較上一季成長 4%。本季度，我們報告淨虧損 5,600 萬美元。儘管產生了所得稅前虧損，但我們本季的有效稅率為 75%。我們本季繳納了2,400 萬美元的稅款，因為我們的大部分稅款是在南非繳納的，由於鋯石銷售量增加以及我們大部分地區出售了部分稀土尾礦礦床，我們的收益高於預期.其他司法管轄區。我們要麼實現淨虧損，要麼持有 NOL 部位。結果，我們調整後的攤薄每股收益虧損 0.38 美元。如前所述，本季調整後 EBITDA 為 9,400 萬美元，調整後 EBITDA 利潤率為 13.7%，本季產生的自由現金流為 5,100 萬美元。

Now let's move to Slide 8 for a review of our commercial performance. Tio2 revenues increased 9% versus the year-ago quarter, driven by a 16% increase in sales volume, a 6% decrease in average selling prices and unfavorable product mix impact of 2%, we saw a favorable impact from FX of 1%. Cercon volumes decreased 26% compared to the year-ago quarter. And zircon pricing was lower by 11% and revenue from other products was $110 million, an increase of 38% compared to the prior year, driven by higher sales of pecan dominate and rare earth tailings that John previously mentioned.

現在讓我們轉到投影片 8 來回顧我們的商業表現。在銷量成長 16%、平均售價下降 6% 以及 2% 的不利產品組合影響的推動下，二氧化鈦收入較去年同期增長 9%，我們看到了 1% 的外匯有利影響。與去年同期相比，Cercon 銷量下降了 26%。鋯石定價下降了 11%，其他產品的收入為 1.1 億美元，與上年相比增長了 38%，這得益於 John 之前提到的山核桃主導產品和稀土尾礦銷量的增加。

Turning to slide 9 nine. I will now review our operating performance for the quarter. Our adjusted EBITDA of $94 million represents a 17% decline year on year, driven by lower average selling prices and higher operating costs due to lower production rates. This was partially offset by improved sales volume and product mix, favorable exchange rate tailwinds and lower freight costs. Sequentially, adjusted EBITDA decreased 19%, driven by higher operating costs due to lower production rates and lower product pricing. This was partially offset by improvement in sales volume and product mix, exchange rate tailwinds and lower freight costs. As we've mentioned previously, we brought down our operating rates in order to manage inventory and cash, which had an unfavorable impact on our costs in the fourth quarter and across the year quarter over quarter, production cost increases of $40 million included $16 million of higher costs associated with lower absorption and higher input costs, $12 million of lower cost or market and idle facility charges due to lower production rates and $9 million of higher mining costs.

轉到投影片 9 九。我現在將回顧我們本季的經營業績。我們調整後的 EBITDA 為 9,400 萬美元，年減 17%，這是由於平均銷售價格下降以及生產率下降導致的營運成本上升所致。這被銷售和產品組合的改善、有利的匯率順風和較低的貨運成本所部分抵銷。隨後，由於生產率下降和產品定價下降導致營運成本上升，調整後 EBITDA 下降了 19%。這被銷售和產品結構的改善、匯率順風和貨運成本下降部分抵銷。正如我們之前提到的，我們降低了開工率以管理庫存和現金，這對我們第四季度和全年的成本產生了不利影響，生產成本增加了 4000 萬美元，其中包括 1600 萬美元與較低的吸收和較高的投入成本相關的較高成本，由於較低的生產率而導致的1200 萬美元的較低成本或市場和閒置設施費用以及900 萬美元的較高採礦成本。

Turning to slide 10, I'll now review our financial position. We ended the quarter with total debt of $2.8 billion and net debt of $2.6 billion. Our net leverage at the end of December was 4.9 times on a trailing 12 month basis. While we ended the year with higher debt than the prior year. The incremental term loan of $350 million raised in the third quarter reinforced the strength of our balance sheet and bolstered available liquidity ahead of anticipated critical vertical integration related capital expenditures. Our nearest term is significant. Maturity remains 2028, and we have no financial covenants on our term loans or bonds. Our weighted average interest rate in Q4 was 6.17%. We maintain interest rate swaps such that approximately 73% of our interest rates are fixed through 2024, approximately 64% are fixed from 2024 through 2028, aligning with the maturity of our term loan. As a result, we do not expect to see our average interest rate increased significantly in the year. Total available liquidity as of December 31 was $761 million, putting $273 million in cash and cash equivalents, an improvement from our Q3 levels and owing to positive cash generated in the quarter.

轉到幻燈片 10，我現在將回顧我們的財務狀況。本季結束時，我們的總債務為 28 億美元，淨債務為 26 億美元。截至 12 月底，我們過去 12 個月的淨槓桿率為 4.9 倍。雖然我們年底的債務比前一年更高。第三季籌集的 3.5 億美元增量定期貸款增強了我們的資產負債表實力，並在預期的關鍵垂直整合相關資本支出之前增強了可用流動性。我們最近的術語很重要。到期日仍為 2028 年，我們的定期貸款或債券沒有財務契約。我們第四季的加權平均利率為 6.17%。我們維持利率互換，使約 73% 的利率在 2024 年之前保持固定，約 64% 在 2024 年至 2028 年期間保持固定，與我們的定期貸款到期日保持一致。因此，我們預計今年的平均利率不會大幅上升。截至 12 月 31 日，可用流動性總額為 7.61 億美元，其中現金和現金等價物為 2.73 億美元，較第三季水準有所改善，這得益於本季產生的正現金。

Capital expenditures totaled $59 million in the quarter, approximately 65% of this was for maintenance and safety, and 35% was for strategic growth projects. Dd&a expense was $69 million for the quarter. We returned $20 million to shareholders in the form of dividends and dividends in the quarter.

本季資本支出總計 5,900 萬美元，其中約 65% 用於維護和安全，35% 用於策略成長項目。該季度的 Dd&a 費用為 6900 萬美元。本季我們以股息和紅利的形式向股東返還了2000萬美元。

I will now turn the call back over to John Romano for some comments on the year ahead and our outlook on things.

現在我將把電話轉回給約翰·羅馬諾，請其對未來一年和我們對事物的展望發表一些評論。

John, we expect 2024 to see a reversal of several of the trends from past the last 18 months on the market, we've already begun to see a pickup in demand for TiO2. That is more positive than we would see normally at this time of year. January is January sales were strong and we're seeing continued strengthening in the market for February and March order books. We expect TiO2 pricing to reverse its downward trend and improve as we move through 2024. Zircon volumes are also continuing to improve from the trough levels realized in July of 2023. The magnitude of the recovery will be somewhat dependent on China as it makes up 50% of the total zircon market. However, even without that significant shift in China, we're seeing demand recover on the operational side. As I mentioned previously, we incurred significant costs in 2023 from running our assets at low utilization rates due to soft market demand we incurred between 25 and $35 million in fixed cost absorption headwinds in each quarter of last year. In 2024 we're already beginning to increase and increase our operating rates in line with demand, which will have a positive impact on our mark manufacturing costs. We still have high cost inventory to move through the business, which we anticipate will carry partially into the second quarter. But by the second half of the year, we should see margins revert to our more normalized levels we continue to deploy technology at our sites to reduce cost and improve efficiencies, which will also improve our cost position as we ramp up, we are investing in key capital projects to sustain our vertical vertical integration as well. From a growth perspective, our R&D efforts remain focused on product and process innovation to enhance profitability. Additionally, we're continuing to explore opportunities in the rare earth space as we are already present in the heavy mineral sands we mine in South Africa and Australia. We are continuing to explore opportunities to increase value as these are after these highly sought-after minerals. We are also continuing to drive our sustainability initiatives, which not only are critical to preserving our privilege to operate, but also support. Tronox is value proposition, and we'll continue to challenge ourselves to be a leader in this regard.

John，我們預計 2024 年市場上過去 18 個月的一些趨勢將會逆轉，我們已經開始看到 TiO2 的需求有所回升。這比我們每年這個時候通常看到的情況更加積極。一月份的銷售強勁，我們看到二月和三月的市場訂單持續走強。我們預計 2024 年 TiO2 定價將扭轉下降趨勢並有所改善。鋯石產量也較 2023 年 7 月的低谷水準持續改善。復甦的幅度將在一定程度上取決於中國，因為中國佔整個鋯石市場的 50%。然而，即使中國沒有重大轉變，我們也看到營運方面的需求有所復甦。正如我之前提到的，由於市場需求疲軟，我們在 2023 年因以低利用率運行資產而產生了大量成本，去年每個季度我們都遭受了 25 至 3500 萬美元的固定成本吸收阻力。2024 年，我們已經開始根據需求提高和提高我們的開工率，這將對我們的標記製造成本產生積極影響。我們仍然有高成本的庫存需要在業務中流通，我們預計這些庫存將部分轉移到第二季。但到今年下半年，我們應該會看到利潤率恢復到更正常的水平，我們將繼續在我們的工廠部署技術以降低成本並提高效率，這也將隨著我們的擴張而改善我們的成本狀況，我們正在投資維持我們垂直整合的關鍵資本項目。從成長的角度來看，我們的研發工作仍然集中在產品和製程創新上，以提高獲利能力。此外，我們正在繼續探索稀土領域的機會，因為我們已經存在於我們在南非和澳洲開採的重礦砂中。我們正在繼續探索增加價值的機會，因為這些都是備受追捧的礦物。我們也繼續推動我們的永續發展舉措，這不僅對於維護我們的營運特權至關重要，而且還提供支援。Tronox 是價值主張，我們將繼續挑戰自己，成為這方面的領導者。

Moving to slide 12, I'd like to spend some time reviewing two of our key capital projects for 2020. For this year, we'll be investing $130 million in two key mining projects in South Africa to replace our existing mines, which are rich, reaching the end of their life. Investment in these projects were delayed in 2023 to preserve cash. Given the lower market demand, these investments will maintain our more than 300 a ton advantage relative to market pricing for feedstock, each project is expected to generate IRRs in excess of 30%. These are critical project to maintain. Tronox is vertically integrated strategy that will continue to enhance our position as a leading TiO2 producer in the industry and the industry's leading financial performance.

轉到投影片 12，我想花一些時間回顧我們 2020 年的兩個關鍵資本項目。今年，我們將投資 1.3 億美元用於南非的兩個關鍵採礦項目，以取代我們現有的礦山，這些礦山資源豐富，已達到使用壽命。為了保留現金，這些項目的投資被推遲到 2023 年。鑑於市場需求較低，這些投資將維持我們相對於原料市場定價超過300噸的優勢，預計每個專案將產生超過30%的IRR。這些是需要維護的關鍵項目。Tronox 採用垂直一體化策略，將繼續增強我們作為業界領先 TiO2 生產商的地位以及業界領先的財務表現。

Turning to slide 13, I'll review our outlook for the quarter and the year ahead in more detail on the first quarter for '24, we expect TiO2 volumes to increase 12% to 16% and zircon volumes to increase 15% to 30% both compared to the fourth quarter. We expect both TiO2 and zircon pricing to remain relatively flat in the quarter, while we expect the headwind from non-repeating sales and other products this will be offset by some improvement on fixed costs due to our higher operating rates. As a result, we're expecting Q1 2024 for adjusted EBITDA to be $100 million to $120 million and adjusted EBITDA margins to be in the mid-teens. While While we're not providing full year EBITDA guidance, we did want to provide a view on our expectations for our '24 cash uses. Our capital expenditures are expected to be approximately $395 million for the year. Our net cash taxes are expected to be less than $10 million as the significant capital expenditures in South Africa are deductible. Our net cash interest expense is expected to be $145 million and we're expecting working capital to be a tailwind. And the magnitude of that tailwind will depend on the significant how significant the market recovery this year.

轉向幻燈片 13，我將更詳細地回顧我們對 24 年第一季本季和未來一年的展望，我們預計 TiO2 產量將增加 12% 至 16%，鋯石產量將增加 15% 至 30%與第四季相比。我們預計本季二氧化鈦和鋯石的定價將保持相對平穩，同時我們預計非重複銷售和其他產品帶來的阻力將被我們較高的開工率帶來的固定成本的一些改善所抵消。因此，我們預計 2024 年第一季調整後 EBITDA 為 1 億至 1.2 億美元，調整後 EBITDA 利潤率將在 15 左右。雖然我們沒有提供全年 EBITDA 指導，但我們確實希望提供對 24 年現金使用預期的看法。我們今年的資本支出預計約為 3.95 億美元。由於南非的大量資本支出可以扣除，因此我們的淨現金稅預計將低於 1000 萬美元。我們的淨現金利息支出預計為 1.45 億美元，我們預計營運資金將成為推動因素。這種順風的幅度將取決於今年市場復甦的程度。

Our strategy remains remains largely unchanged. We're prioritizing investments in the business that are critical to furthering our strategy and driving value from our vertically integrated portfolio. Even at this investment level, we expect to generate positive free cash flow for the year, we will see we will also be focused on bolstering our liquidity. And as the market recovers, we'll look to resume debt paydown. We will continue to evaluate strategic high-growth opportunities as they arise. Currently, we're focusing on the rare space, and we will keep the market updated on any key developments that will conclude our prepared remarks.

我們的策略基本上保持不變。我們優先考慮對推進我們的策略和推動垂直整合投資組合價值至關重要的業務投資。即使在這個投資水準上，我們預計今年將產生正的自由現金流，我們也將專注於增強流動性。隨著市場復甦，我們將尋求恢復債務償還。我們將繼續評估出現的策略性高成長機會。目前，我們正專注於這個罕見的空間，我們將向市場通報任何關鍵進展的最新情況，以結束我們準備好的評論。

And we'll now move to Q&A portion of the call. So I'll hand the call back over to the operator to facilitate operator.

我們現在將進入電話會議的問答部分。所以我會把電話轉交給接線生方便接線員。

Ladies and gentlemen, we will now begin the question-and-answer session. (Operator Instructions) One moment please, for your first question.

女士們、先生們，我們現在開始問答環節。（操作員說明）請稍等一下，回答您的第一個問題。

John McNulty with BMO Capital Markets.

BMO 資本市場部的 John McNulty。

Yes, good morning. Thanks for. Thanks for taking my question, Tom. So I guess the first one would just be you've got a relatively positive outlook on the volume front for TiO2 as we look to the first quarter, is there any geographic deviation in terms of in terms of where you're seeing kind of that outsized or above-normal demand? Or is it is it relatively broad? How should we think about that?

是的，早安。感謝。感謝您提出我的問題，湯姆。因此，我想第一個問題是，當我們展望第一季時，您對 TiO2 的銷售前景有相對積極的看法，就您所看到的情況而言，是否存在地理偏差需求量過大或高於正常水平？還是說它的範圍比較廣？我們該如何思考這個問題？

Yeah. Thanks for the question. On silicon in the first quarter, it's relatively broad. We're seeing it across all the six sectors. We mentioned that we didn't we saw a little bit more seasonality in the fourth quarter in the North American market, and we're starting to see the North American market pick up a bit more so that increase in Q1 sales normally, Q1 and Q4 would typically be pretty similar. So we really do believe that based on what we're seeing in the field from our customers we're confidently. We're confident that the destocking has largely run its course, and we're seeing customers restocking and moving into more normal buying patterns. I think additionally, historically, our business has kind of led in and out of economic transitions. And we really do believe we're on the front end of a recovery. And this is having a, I'd say, more positive impact on our outlook for the entire year.

是的。謝謝你的提問。第一季的矽片範圍相對廣泛。我們在所有六個領域都看到了這一點。我們提到，我們沒有看到北美市場第四季的季節性增加，我們開始看到北美市場回升更多，因此第一季銷售額通常會增加，第一季和第四季通常非常相似。因此，我們確實相信，根據我們在客戶那裡看到的情況，我們對此充滿信心。我們相信，去庫存已基本完成，我們看到客戶正在補充庫存並進入更正常的購買模式。此外，我認為，從歷史上看，我們的業務在某種程度上引領了經濟轉型。我們確實相信我們正處於復甦的前端。我想說，這對我們全年的前景產生了更積極的影響。

Got it. Okay. Fair enough. And then maybe just speaking to the fixed cost absorption issue. You highlighted in one of the slides $25 million to $35 million per quarter hit. So I mean, we're talking like $100 million, $150 million for the year, which is pretty chunky, I guess, is there a way to think about what volume levels you need or where we what we need to see in 2024 to completely erase that? Or I guess is there kind of a rule of thumb that we should be thinking about as that as that kind of fixed cost absorption headwind dies down?

知道了。好的。很公平。然後也許只是談論固定成本吸收問題。您在一張幻燈片中強調了每季 2500 萬至 3500 萬美元的點擊量。所以我的意思是，我們談論的是今年 1 億美元、1.5 億美元，我想這是相當大的，有沒有辦法考慮一下你需要什麼數量水平，或者我們需要在 2024 年完全看到什麼？刪除那個？或者我想，隨著這種固定成本吸收阻力的減弱，我們是否應該考慮某種經驗法則？

Yes. It's a great question. I'll start and Jean, maybe you can add on to it. So you know, historically some wind for wind, the clock back four quarters. We were, I think, 18 months in a row, but consistently above 20% EBITDA margins and we quoted something just below 14%. So in a running at the rates that we've been running at, which again, we made the point that it's lower than what we've ever historically run. We believe that where we're ramping up right now and we're not at full capacity. We're ramping up the assets that as we move through the first quarter, we'll start to get to volumes. And I'd say capacity utilization, which should get us back to, I would say, mid to normal run rates on EBITDA margin. But we also have to think about the inventory that we have got to work through. So I made the reference on the call that we've got inventory on the balance sheet. We're going to have to work through that. It's probably going to work its way probably halfway through the second quarter. But when we get in the second half of the year, you should start to think about those normal low to mid 20 kind of run rates on EBITDA margin. And that's without a lot of movement on price.

是的。這是一個很好的問題。我先開始，Jean，也許你可以補充。所以你知道，歷史上有些風對風，時鐘會倒退四刻鐘。我認為，我們的 EBITDA 利潤率連續 18 個月保持在 20% 以上，而我們的報價略低於 14%。因此，在以我們一直運行的速度運行時，我們再次指出，它低於我們歷史上運行的速度。我們相信，我們現在正在加速，但還沒有達到滿載。我們正在增加資產，隨著第一季的推進，我們將開始增加資產規模。我想說的是產能利用率，這應該會讓我們回到 EBITDA 利潤率的中等到正常水準。但我們也必須考慮我們必須處理的庫存。因此，我在電話中提到我們的資產負債表上有庫存。我們必須解決這個問題。它可能會在第二季度過半時發揮作用。但當我們進入今年下半年時，您應該開始考慮 EBITDA 利潤率正常的低至中 20 種運行率。這還是價格沒有太大變動的情況。

And John, I would add to that, that on the mining side of our business, remember last year, we mentioned that the drop was so significant that we had to slow down our mine and our mine and smelter, our high fixed cost operations, we're back to running those assets at full capacity in '24.

約翰，我想補充一點，在我們業務的採礦方面，記得去年，我們提到下降幅度如此之大，以至於我們不得不放慢我們的礦山、礦山和冶煉廠的速度，以及我們高固定成本的運營，我們將在 2024 年恢復滿載運行這些資產。

Got it. Okay. No, that's very helpful. Thanks very much for the color.

知道了。好的。不，這非常有幫助。非常感謝你的顏色。

David Begleiter, Deutsche Bank.

大衛‧貝格萊特，德意志銀行。

Thank you. Good morning. John. You mentioned the prospects for higher pricing in TiO2 this year. We think it will manifest first in what region by what end markets and yes

謝謝。早安.約翰。您提到今年二氧化鈦價格上漲的前景。我們認為它將首先在哪個地區透過哪個終端市場體現出來，是的

So we typically don't give a lot of regional view on that, but I would expect it largely what I mentioned in the first quarter's pricing was going to be relatively flat, both on zircon and on TiO2. And we did largely see rollovers moving into the first quarter of 2024. I would suspect that as we start to migrate out of the first quarter, we'll start to look at pricing opportunities across all regions. But there's a lot of activity. We've got a lot of questions about the antidumping, everything that we're talking about right now. It has nothing to do with anti-dumping the anti-dumping if it actually happens and it gets inputted and provisional duties come in. That could be something additive to this. But what we're talking about right now is just generally what we're seeing in the market. We would see that these are all the signs and indicators that would indicate pricing would start to move up. That's not in the first quarter, but we're hopeful we'll start to see some sort of movement as we move into Q2.

因此，我們通常不會對此給出太多的區域觀點，但我預計，我在第一季提到的定價將相對平穩，無論是鋯石還是二氧化鈦。我們確實看到大部分展期會進入 2024 年第一季。我懷疑，當我們開始從第一季開始遷移時，我們將開始考慮所有地區的定價機會。但有很多活動。我們有很多關於反傾銷的問題，我們現在正在談論的一切。如果實際發生並輸入臨時關稅，則與反傾銷無關。這可能是對此的補充。但我們現在談論的只是我們在市場上看到的一般情況。我們會看到這些都是表明價格將開始上漲的跡象和指標。這不是第一季的情況，但我們希望進入第二季時我們會開始看到某種變化。

And John, on the anti-dumping, are you seeing any change in buyer behavior yet because of these of this investigation? And how what's the timeline from a risk perspective for the for the EC to act?

約翰，關於反傾銷，您是否看到買家行為因這次調查而發生任何變化？從風險角度來看，歐盟委員會採取行動的時間表是怎樣的？

Yeah. So maybe on the timeline, the formal investigation come from the commission, what we what happened was the coalition. This was a coalition that was formed back in November of '23 when the dumping suit was filed, we would expect the formal investigation to conclude in the second quarter and under the process that the final recommendation won't happen until the fourth quarter. However, there could be a possibility that provisional duties could get put in place sometime as early as the second quarter, but that's yet to be seen as far as are we seeing any real significant buying change?

是的。所以也許在時間表上，正式調查來自委員會，我們所發生的是聯盟。這個聯盟是在 23 年 11 月傾銷訴訟提起時成立的，我們預計正式調查將在第二季結束，在此過程中，最終建議要到第四季才會出現。然而，臨時關稅有可能最早在第二季的某個時候實施，但目前還不清楚我們是否看到任何真正重大的購買變化？

I'd say we're seeing a little bit, but nothing significant. There's some, I'd say, export activity that's going on, that's in line with what we would have expected as a dumping suit was filed in the EU.

我想說我們看到了一點，但沒有什麼重要的。我想說，有一些出口活動正在進行，這符合我們在歐盟提起傾銷訴訟時的預期。

Thank you.

謝謝。

Josh Spector UBS.

瑞銀集團喬許·斯佩克特。

Hey, guys, this is James Hennen on for Josh. Thanks for taking my question on. Just if we go back to kind of the comments you gave on the projects, the mining projects you're doing in on South Africa. Can you just give a little color as to the rationale behind moving forward with them now as opposed to once we've gotten back to kind of a more steady state. I mean, it seems like with the with the mining rates having come down last year, there would be additional capacity to kind of lift rates elsewhere in the system and maybe not require that CapEx at this stage.

嘿，夥計們，我是詹姆斯·亨南 (James Hennen) 替補喬什 (Josh)。感謝您回答我的問題。讓我們回顧一下您對南非正在進行的採礦項目的項目的評論。您能否稍微說明一下現在推進這些計劃的理由，而不是我們回到更穩定的狀態後的理由。我的意思是，隨著去年採礦率的下降，系統中其他地方將有額外的能力來提高採礦率，並且現階段可能不需要資本支出。

And look, so last year, we delayed those projects on both these, but both projects in South Africa one was a little bit further along than the other one. So we have to run our business on a long term and the mining projects actually do require a longer view than quarterly minimum earnings. So we feel that it was an appropriate delay.

看，去年我們推遲了這兩個項目，但這兩個項目在南非的一個比另一個項目進展得稍微遠一些。因此，我們必須長期經營我們的業務，而採礦項目實際上確實需要比季度最低收益更長遠的眼光。所以我們認為這是一個適當的延遲。

What we did last year. We spent some time bolstering our liquidity last year for that specific purpose to make sure that we had the ability to invest in these assets because at the end of the day, as I mentioned on the call, these are actually replacing mines that are coming to the end of their life. So if we want to maintain our zircon volumes and the ilmenite to feed our smelters, these are long-term projects. And we've got a five-year plan for our TiO2 business, but more like a 20-year plan to manage our mining. So we feel that what we're doing at this particular stage is not only appropriate. It's needed to make sure we can maintain our long-term business.

我們去年做了什麼。去年，我們為了這個特定目的花了一些時間來增強我們的流動性，以確保我們有能力投資這些資產，因為最終，正如我在電話會議上提到的，這些資產實際上正在取代即將到來的礦山。他們生命的終點。因此，如果我們想維持鋯石產量和鈦鐵礦供應冶煉廠，這些都是長期項目。我們為鈦白粉業務制定了五年計劃，但更像是管理採礦業的 20 年計劃。所以我們覺得我們在這個特定階段所做的事情不僅是合適的。這是確保我們能夠維持長期業務所必需的。

Okay, thanks. And then just on timing with those, can you give some commentary on when you anticipate those to start producing and whether or not there will be any drag on OpEx or absorption as those do start up?

好的謝謝。然後，就這些項目的時機而言，您能否對預計這些項目何時開始生產以及這些項目開始生產時是否會對運營支出或吸收產生任何拖累發表一些評論？

So as both my ears are in both of those mines that they'll be at a basically a transition from the end of the mind of the previous one to a transition to the new one. So there shouldn't be a lot of lag or lead time moving in. It's all timing as we move out of one body of ore will be moving into another one. So there shouldn't be a lot of transition. Obviously, as we're bringing up some of the mining equipment, there could be a little bit of transition.

因此，由於我的兩隻耳朵都在這兩個地雷中，因此它們基本上將處於從前一個思維的終結到向新思維的過渡的過渡。因此，搬入不應有太多的延遲或提前時間。當我們從一個礦體移出並進入另一個礦體時，這一切都是時間安排。所以不應該有太多的過渡。顯然，當我們推出一些採礦設備時，可能會有一些過渡。

We don't we don't expect that to be a drag and I think as we as we start new mines, obviously, there's the whole resource there and we do optimize to bring out of the higher value ore earlier on. So we would expect and when those mines come online, see some positive benefit.

我們不認為這會成為一個拖累，我認為當我們開始新礦山時，顯然，那裡有全部資源，我們確實進行了優化，以便儘早開採出更高價值的礦石。因此，我們預計當這些礦場上線時，我們會看到一些正面的好處。

Okay, great. Thanks.

好的，太好了。謝謝。

Duffy Fischer, Goldman Sachs.

達菲費雪，高盛。

Yes, good morning, guys. If you could your CapEx assumption for this year's $395 million, your operating cash flow last year was $184 million sort of be free cash flow positive this year. That means you need to grow your operating cash flow a little over $200 million this year. Can you just walk through how you see those buckets coming through? How much of that would be an improvement in EBITDA, how much of that would be things like improvement in working capital or anything else on the cash flow statement kind of before the operating activities that would get us at $200 million plus?

是的，早上好，夥計們。如果您將今年的資本支出假設為 3.95 億美元，那麼您去年的營運現金流為 1.84 億美元，今年的自由現金流為正。這意味著您今年的營運現金流需要增加 2 億多美元。能簡單介紹一下您是如何看到這些水桶通過的嗎？其中有多少是 EBITDA 的改善，有多少是營運資金的改善或經營活動之前現金流量表上的其他內容，這將使我們的收入達到 2 億美元以上？

Yes, Duffy, thanks for that question. And we aren't guiding for the full year. So from an earnings perspective, we are optimistic, but obviously expect an improvement year over year. And ultimately, our free cash flow, the scope and size of that positiveness we expect will depend on market dynamics there. But from a working capital perspective, that's the earnings and working capital are the biggest drivers. Obviously, we guided on interest negative 100, $45 million, taxes less than $10 million. And as you mentioned CapEx of $395 million. So we do expect both free cash flow and working capital to be positive. And from a working capital perspective, we do see obviously sales are going up. The AR. is going to be a hurt, but that obviously is a good working capital use there. And we do see inventory. We are building some inventory in that play with inventory and AR will all depend on top line sales growth. We do expect payables as well to be a source of cash as we are actively managing that throughout the year. So and that's kind of where we are on free cash flow.

是的，達菲，謝謝你的提問。我們並沒有提供全年的指導。因此，從獲利角度來看，我們持樂觀態度，但顯然預期會比去年同期有所改善。最終，我們的自由現金流、我們預期的積極性的範圍和規模將取決於那裡的市場動態。但從營運資本的角度來看，獲利和營運資本是最大的驅動因素。顯然，我們的指導利率為負 100，即 4500 萬美元，稅收低於 1000 萬美元。正如您所提到的資本支出為 3.95 億美元。因此，我們確實預期自由現金流和營運資本均為正值。從營運資金的角度來看，我們確實看到銷售額明顯上升。AR。這將會是一種傷害，但這顯然是一個很好的營運資金用途。我們確實看到了庫存。我們正在建立一些庫存，庫存和 AR 都將取決於營收成長。我們確實預計應付帳款也將成為現金來源，因為我們全年都在積極管理應付帳款。這就是我們自由現金流的情況。

And just generically from the operating side, again, we talked a couple of times about running at I think we've been throwing numbers up 70% capacity utilization for over a year. And as we started to ramp up those assets early as early as December of last year and into the first quarter. Obviously a little tedious as you start to move up from those lower rates. So it wasn't super smooth to get to where we are today, but now those assets are running. So when you think about that 25 to $35 million a quarter that we've talked about as a negative due to fixed cost absorption, we'll start to see similar results and some of these unplanned outages that we have will be added onto that. So they'll be a significant portion of that. So when we think about the growth, it's obviously prices and opportunity, but running our assets at grades that are at a more normalized level, which are in line with what we've historically seen on EBITDA margins, as I mentioned before, it's going to be a big driver in our profitability.

從營運方面來說，我們再次討論過幾次關於運行的問題，我認為一年多來我們一直在將產能利用率提高到 70%。我們早在去年 12 月就開始增加這些資產，並持續到第一季。當您開始從較低的利率升級時，顯然有點乏味。因此，到達今天的位置並不是非常順利，但現在這些資產正在運作。因此，當您想到我們所說的由於固定成本吸收而產生的每季度 25 至 3500 萬美元的負面影響時，我們將開始看到類似的結果，並且我們將添加其中的一些計劃外停機。因此，它們將成為其中的重要組成部分。因此，當我們考慮成長時，顯然是價格和機會，但以更正常化的水平運行我們的資產，這與我們歷史上在EBITDA 利潤率上看到的一致，正如我之前提到的，它正在發展成為我們獲利能力的重要推動力。

Okay, thank you. And then there have been several reports out of South Africa with two of their larger unions in the mining industry kind of fighting and there's just been some kidnapping and stuff like that. Do you have both of those unions at your operation or are you kind of a single union in and against, are you seeing any issues with your operations or any the other TiO2 operations in South Africa?

好的謝謝。然後有幾份來自南非的報道稱，南非採礦業的兩個較大工會發生了戰鬥，也發生了一些綁架之類的事情。您的營運中是否有這兩個工會，或者您是一個支持和反對的工會，您是否發現您的營運或南非的任何其他 TiO2 營運有任何問題？

See, I mean, I can tell you we only have one union in our case and we're looking to be in an area where there is no revalidate fee and no issue between the union book and we have always stated that our approach in South Africa is to work with our community. All worker are not remote worker.

看，我的意思是，我可以告訴你，在我們的案例中，我們只有一個工會，我們希望進入一個沒有重新驗證費用且工會簿之間沒有問題的地區，我們一直聲明我們在南方的方法非洲要與我們的社區合作。所有工人都不是遠端工人。

They are a local, all their member of the community where our mine and smelter are located, and that makes a huge difference with the dynamic often.

他們都是當地人，都是我們礦場和冶煉廠所在社區的成員，這與動態經常產生巨大的差異。

And all those issues that we heard about South Africa are related to worker our Life Care remote and also in our store, and we don't have that issue at our mine group.

我們聽到的所有這些有關南非的問題都與我們的 Life Care 遙控器和我們商店的工人有關，而我們的礦井組沒有這個問題。

Thank you, guys.

感謝你們。

Your next question comes from Jeff Costco with JPMorgan. Please go ahead.

您的下一個問題來自摩根大通的 Jeff Costco。請繼續。

Thanks very much.

非常感謝。

And I think your TiO2 volume for the past two years is down about 15% each year. How do you think the industry shrank over 2022 and 23. How did you do compared to the overall industry?

我認為過去兩年你們的 TiO2 產量每年下降約 15%。您認為2022年和23年產業萎縮情況如何？與整個產業相比，你們的表現如何？

Yes.

是的。

Thanks, Jeff. But you're right. Yes, if you look at our over the last two years, I think our volumes were down roughly 27%, so 15% of years pretty much accurate. And China obviously grew. I know you take an interest in paying a lot of attention to the exports coming out of China. China has taken a significant growth specifically in Asia Pacific. India has become a significant importer of Chinese material. A lot of Asia Pacific so not just in China. So I do think that over time, I that we've probably lost a little bit of share to the Chinese, and we've done that based on where we feel like it just was not competitive. And that being said, I think others probably were hurt a bit more than the Chinese were our I think our chloride capacity has provided us an opportunity to avoid some of that. That being said, we feel like we can compete directly with the Chinese and there's lots going on. We've already talked about with some of the efforts that are trying to manage that in the European market. But Tom, I would suspect that the market is still growing. China took a disproportional share of that growth over the last couple of years and thank you for that. Can you can you just give us sort of a status report on project Neutron? That is how much more is still to be spent? And what have the savings been? And what can this what could the savings be? Where does all of that?

謝謝，傑夫。但你是對的。是的，如果你看看我們過去兩年的情況，我認為我們的銷量下降了大約 27%，所以 15% 的年份相當準確。中國顯然在成長。我知道您非常關注中國的出口。中國尤其在亞太地區實現了顯著成長。印度已成為中國材料的重要進口國。亞太地區很多地方，不只是中國。所以我確實認為，隨著時間的推移，我們可能已經失​​去了一點份額給中國人，我們這樣做是基於我們覺得它沒有競爭力。話雖這麼說，我認為其他人受到的傷害可能比中國人受到的傷害更大一些，我認為我們的氯化物產能為我們提供了避免其中一些情況的機會。話雖這麼說，我們覺得我們可以與中國人直接競爭，而且還有很多事情要做。我們已經討論過一些試圖在歐洲市場管理這個問題的努力。但是湯姆，我懷疑市場仍在成長。過去幾年，中國在這一增長中佔據了不成比例的份額，為此表示感謝。您能為我們提供一份 Neutron 專案的狀態報告嗎？那還需要花多少錢呢？節省了什麼？這能節省什麼呢？這一切都在哪裡？

Yes. Yes.

是的。是的。

So for 2024, we've still got about 20 million to spend on. So we're going through some additional launches of S4 Hana up in Asia Pacific, so early as July of this year. So we're still working through that process. And I don't know, Johnny Maybe talk a little bit more some of the upsides as far as what we're seeing an opportunity. But there are we think about automated process control toys, which has shown us is operational information system. All those things are being utilized to extract more out of our assets. I think early on that was there was a fair amount of additional value that was coming from volume, which we haven't seen yet. So we would start to see that I'd say probably more towards the end of this year and early into next big chunk?

因此，到 2024 年，我們還有大約 2,000 萬的支出。因此，我們最早將於今年 7 月在亞太地區推出一些 S4 Hana。所以我們仍在完成這個過程。我不知道，約翰尼也許能多談談我們看到的機會的一些好處。但還有我們思考的自動化過程控制玩具，它向我們展示的是可操作的資訊系統。所有這些東西都被用來從我們的資產中提取更多。我認為早期有相當多的附加價值來自於數量，但我們還沒有看到。所以我們會開始看到我可能會在今年年底和下一個大塊年初說更多？

Yes, no doubt, John, that's exactly right. I mean, we still do believe in the benefits that we're going to see from Neutron, we grow quoted at historically 150 to $200 per tonne and a big portion of that, how we did capture already from procurement savings, although that was masked a little bit by the two significant escalation we've had over the past couple of years. But from a volume perspective, we said those aren't whole, but frankly, we think that some of those benefits will accelerate as we are bringing up our assets. So we do expect to still be within that range, obviously, where we only have deployed, as John mentioned, in Asia Pacific. So we will need to from a systems perspective, but we have deployed from some of the other operating on enhancements on multiple sites.

是的，毫無疑問，約翰，這是完全正確的。我的意思是，我們仍然相信我們將從 Neutron 中看到的好處，我們的報價在歷史上每噸 150 至 200 美元，其中很大一部分是我們如何從採購節省中獲得的，儘管這被掩蓋了過去幾年我們經歷的兩次重大升級都造成了一點影響。但從數量的角度來看，我們說這些並不完整，但坦白說，我們認為隨著我們資產的增加，其中一些好處將會加速。因此，我們確實預計仍會在這個範圍內，顯然，正如約翰所提到的那樣，我們只在亞太地區進行了部署。因此，我們需要從系統角度進行部署，但我們已經在多個站點上部署了一些其他操作上的增強功能。

So do you expect to see those benefits from a volume perspective.

那麼您是否期望從數量角度看到這些好處呢？

And if this is Jennifer, just if I can add, we are seeing benefits at a site level from the deployment of some of the technologies like automated process control arm. So for example, we're seeing reduced coke consumption in our chlorinated. When you look at a like-for-like comparison on the volumes produced, it's just a bit masked because of the low run rates that were operating at on. But for example, this did have a positive effect on our GHG emissions, reduced our intensity because we're more efficient for the tonnes we're producing. So we are capturing benefits, not all of them necessarily on the P & L. We're seeing them on the sustainability side of the business. But as we ramp our assets back up, we would expect to consume lower raw materials like Coke in our coordinators of four per ton of TiO2, and this should translate to benefits on the P&L.

如果這是詹妮弗，我可以補充一下，我們正在從部署自動化過程控制臂等一些技術中看到網站層級的好處。例如，我們看到氯化過程中的焦炭消耗量減少了。當你查看產量的同類比較時，你會發現，由於當時的運行率較低，結果有點被掩蓋了。但舉例來說，這確實對我們的溫室氣體排放產生了正面影響，降低了我們的強度，因為我們生產的噸數效率更高。因此，我們正在獲取收益，但不一定全部都在損益表上。我們在業務的可持續發展方面看到了它們。但隨著我們增加資產，我們預計每噸 TiO2 的協調員消耗的原材料（例如可樂）會減少，這應該會轉化為損益表上的收益。

So the spending is essentially done or this 20 million more and more to go as something relatively small. But as you ramp up and we should see the benefits that they are general?

因此，支出基本上已經完成，或者這 2000 萬越來越多，作為相對較小的事情。但隨著你的進步，我們應該看到它們普遍帶來的好處？

That's correct, yes, yes, that's correct.

沒錯，沒錯，沒錯，沒錯。

And it just to Jennifer's point, I mean, the whole idea about that one, our automated process control on our coordinators, we have 24 across the system. And last year, I think we finalized the implementation of all of that across the entire system. So again, as we start to ramp up the assets, we'll start to get a lot more of that value as Jennifer noted.

這正是珍妮佛的觀點，我的意思是，關於這個的整個想法，我們對協調員的自動化流程控制，我們在整個系統中有 24 個協調員。去年，我認為我們最終完成了整個系統中所有這些的實施。因此，正如詹妮弗所指出的那樣，當我們開始增加資產時，我們將開始獲得更多的價值。

Yes.

是的。

Maybe if I can sneak in one more question. Can you can you talk about what's going on with chlorine prices and what you what you expect for the year. And so what I can say is that our chlorine prices have continued to move in a positive direction from the downside. So that chlorine is very different depending upon the region. So in Saudi Arabia, we make our own chlorine in Australia. We have a lot of purpose built plants but in North America, we buy merchant chlorine. And we've seen what I would say is a significant reduction in Q4 and in Q1 on chlorine prices, which is going to have a positive impact as well.

也許我可以再問一個問題。您能談談氯氣價格的變化以及您對今年的預期嗎？因此，我可以說的是，我們的氯價格繼續從下行趨勢朝正向發展。因此，氯根據地區的不同而有很大不同。因此，在沙烏地阿拉伯，我們在澳洲自己生產氯。我們有很多專門建造的工廠，但在北美，我們購買商業氯。我想說的是，我們已經看到氯價格在第四季和第一季大幅下降，這也將產生正面影響。

Okay.

好的。

Thank you, sir.

謝謝你，先生。

Your next question comes from Mike Leithead with Barclays. Please go ahead.

您的下一個問題來自巴克萊銀行的麥克萊特黑德。請繼續。

Great.

偉大的。

Thank you.

謝謝。

Good morning. I guess on first question, what are you expecting from a zircon pricing outlook?

早安.我想第一個問題是，您對鋯石價格前景有何期望？

So I think I mentioned in previous or in my prepared comments for the fourth quarter, on the first quarter, we saw rollover on pricing. So there was actually a slight bump up in price from Q1 to Q2 from Q4 to Q1, but that's all mix. So in the first quarter, we're seeing flat pricing and I look at a lot of it's going to depend on how the market continues to evolve. July of 2023 was a very low point, but that was the bottom. And we see we've seen the market continue to improve. Our Q1 or Q4. Sales were up by 82%. We forecasted in the prepared comments 15% to 30% additional increase in the first quarter. That big swing has a lot to do with the weather, but big bulk shipments actually going to go this quarter or not. And all of that growth is on the back of not much growth in the ceramic industry in China, which is about 50% of the market. So we're seeing the market recover. We believe that destocking has run its course. Customers are buying again, and we're starting to see an uplift even in China.

因此，我想我在之前或在我準備的第四季度評論中提到，在第一季度，我們看到了定價的滾動。因此，從第一季度到第二季度，從第四季度到第一季度，價格實際上略有上漲，但這都是混合的。因此，在第一季度，我們看到定價持平，我認為這很大程度上取決於市場如何繼續發展。2023 年 7 月是一個非常低的點，但那就是底部。我們看到市場持續改善。我們的 Q1 或 Q4。銷售額成長了 82%。我們在準備好的評論中預測第一季將有 15% 至 30% 的額外成長。這種大幅波動與天氣有很大關係，但大宗貨物實際上是否會在本季度發貨。所有這些增長都是建立在中國陶瓷行業增長不大的基礎上的，而中國陶瓷行業約佔市場的 50%。所以我們看到市場正在復甦。我們相信去庫存已經結束。顧客再次購買，我們甚至在中國也開始看到成長。

In the non ceramic applications, we started to see restocking occurs. We believe destocking has run its course there as well. So all of that would indicate that as we move through the year, we should start to see positive movements in zircon pricing but it's a little bit too early to provide a clear forecast on that.

在非陶瓷應用中，我們開始看到補貨的情況發生。我們相信去庫存也已經結束。因此，所有這些都表明，隨著今年的進展，我們應該開始看到鋯石價格的積極變化，但現在對此提供明確的預測還為時過早。

Great.

偉大的。

Thank you.

謝謝。

And then again, I apologize if I missed it, but what's the latest update on Amazon, are you still expecting to get the full repayment in-kind? And was the technical service agreement and those again are doable?

再說一遍，如果我錯過了，我深表歉意，但是亞馬遜的最新更新是什麼，您是否仍然期望獲得全額實物還款？技術服務協議等是否可行？

Yes.

是的。

So look, we're still working with Amazon. The debt is due in January of 25 when we continue to get slag in lieu of and that flag is actually going towards the payment of the debt from. And there's not much change in our agreement with them at this particular stage. So still continuing to work with them. And the slag that we're getting is largely going down to pay down debt Okay.

所以看，我們仍在與亞馬遜合作。債務將於 25 月 1 月到期，屆時我們將繼續獲得礦渣代替，而該標誌實際上將用於償還債務。在這個特定階段，我們與他們的協議沒有太大變化。所以仍然繼續與他們合作。我們得到的礦渣很大程度上會用來償還債務。

Thank you.

謝謝。

Your next question comes from Hassan Ahmed with Alembic Global. Please go ahead.

您的下一個問題來自 Alembic Global 的 Hassan Ahmed。請繼續。

Good morning, John and Jeff. One quick quick question around the cost curve. The global cost curves as you see them right now. I mean, look, as I sort of sit there and think about the EBITDA margins that you guys just reported in Q4, you know, call it 13 and change percent, obviously down from Q4 of 22 levels of north of 17%, 17% plus in Q three. I mean, I'd like to thank you guys being as integrated as you are obviously, and you talk about this as well, enjoy sort of a margin premium relative to your competitors globally. So I'd like to think that you know, there's a large chunk of the industry that is at breakeven to maybe even negative EBITDA margins.

早安，約翰和傑夫。關於成本曲線的一個快速問題。您現在看到的全球成本曲線。我的意思是，看，當我坐在那裡思考你們剛剛在第四季度報告的EBITDA 利潤率時，你知道，稱其為13 並變化百分比，明顯低於第四季度22 水平的17%、17 %加上第三個問題。我的意思是，我要感謝你們，你們顯然是那麼整合，你們也談到了這一點，相對於你們的全球競爭對手，享受著某種程度的利潤溢價。因此，我想您知道，該行業有很大一部分處於盈虧平衡狀態，甚至可能出現負 EBITDA 利潤率。

Right? And then I sort of sit there and think about the guidance that you've given for 2024 of mid 10s EBITDA margins, I mean, does that get if the industry moves in that direction? I mean, are you sort of guiding to the industry beginning to make sort of positive EBITDA margins? I mean, I'm just trying to get a sense of where the industry is or the sort of breakeven to negative margin sustainable for the industry? And maybe potentially, are you being conservative in giving the margin guidance that you guys have given?

正確的？然後我坐在那裡思考您為 2024 年 10 多歲的 EBITDA 利潤率給出的指導，我的意思是，如果行業朝這個方向發展，這會實現嗎？我的意思是，您是否正在引導該行業開始實現正的 EBITDA 利潤率？我的意思是，我只是想了解該行業的狀況，或者該行業可持續的盈虧平衡至負利潤的情況？也許你們在給出你們給予的利潤指導時是否保守？

So I look at the guidance that we gave for mid 10s was for Q1. And I think we got a question a bit earlier about where we see the business moving from a lot of that margin. Let let's just say price doesn't move what we've said, we expect it to. But if price didn't move, our margin is going to improve as our capacity increases. And by midyear, we would expect that our our EBITDA margins will be back in the 20s. We ran 18 months, 18 quarters in the mid to high 20s. So just put pricing aside, running our assets because of our vertical integration is actually going to do just exactly what you said. It's going to get us to norm normalized EBITDA margins on our competitors. I'm not going to speak to them, but they're publicly. Their information is publicly available. I wouldn't disagree with the comments you made. I do believe that the Chinese are in that similar boat with not making significant EBITDA margin anywhere and we believe the majority of them are losing money. So we believe our margins are going to improve and 24 is going to be a much better year and ultimately where we are as an industry is not a sustainable place to be negative EBITDA margins don't. And you can't do that for very long because people don't have balance sheets to support that.

所以我看一下我們為第一季提供的 10 年代中期的指導。我認為我們早些時候就被問到一個問題，即我們認為業務將從大量利潤中轉向何處。假設價格並沒有像我們所說的那樣變化，我們預期它會發生變化。但如果價格沒有變化，我們的利潤率將會隨著產能的增加而提高。到年中，我們預計 EBITDA 利潤率將回到 20 多歲。我們跑了 18 個月、18 個季度，時間在 20 多歲左右。因此，拋開定價不談，由於我們的垂直整​​合而運行我們的資產實際上將完全按照您所說的進行。這將使我們的 EBITDA 利潤率達到競爭對手的正常水準。我不會和他們說話，但他們是公開的。他們的資訊是公開的。我不會不同意你的評論。我確實相信中國人也處於同樣的境地，在任何地方都沒有獲得可觀的 EBITDA 利潤，而且我們相信他們中的大多數都在虧損。因此，我們相信我們的利潤率將會提高，24 年將會是一個更好的一年，最終我們作為一個產業不會是一個可持續的地方，EBITDA 利潤率為負。而且你不能長期這樣做，因為人們沒有資產負債表來支持這一點。

Fair enough. And as a follow up, if I could revisit the whole and sort of European Commission anti-dumping side of things, I mean, is it fair to assume whatever direction the final ruling takes. I mean, is it fair to assume that it's almost like 200 to 250,000 tons of sort of material that is up for grabs and that could potentially entirely go towards the western producers. If you look at I guess up for grabs is a it's a way to look at it, but if I'm a Chinese producer, I mean the other option would be for them to raise their price on a once a duty is in place. I think that that is going to drive some different behavior for sure and dumb. It's early days. Like I said, the formal investigation won't end until the first quarter or into the first quarter and then it'll typically be the end of the year before the process is complete, provisional duties could come sooner than that. So we're just kind of a again, this was something that was led by a coalition of suppliers. So we don't feel like we have exact data on what happening, but we do have a pretty good feel on a pretty good idea of where we are in the process and it's just a bit early to determine what that duty is and if it's going to get implemented, but if it were to, yes, I would definitely think that there's going to be some volume shift and some pricing opportunity.

很公平。作為後續行動，如果我可以重新審視歐盟委員會反傾銷方面的整體情況，我的意思是，假設最終裁決採取的任何方向是否公平。我的意思是，可以公平地假設有大約 200 到 25 萬噸的材料可供爭奪，並且有可能完全流向西方生產商。如果你看我猜想，這是一種看待它的方式，但如果我是中國生產商，我的意思是，另一個選擇是他們在關稅到位後提高價格。我認為這肯定會導致一些不同的行為，而且是愚蠢的。現在還早。正如我所說，正式調查要到第一季或第一季才會結束，然後通常要到年底才能完成，臨時關稅可能會比這更早到來。所以我們只是再次，這是由供應商聯盟領導的。因此，我們覺得我們沒有關於正在發生的事情的確切數據，但我們確實對我們在這個過程中所處的位置有一個很好的感覺，現在確定該職責是什麼以及它是否還為時過早將會實施，但如果真的實施了，是的，我肯定會認為將會出現一些銷售變化和一些定價機會。

Perfect. Thank you so much.

完美的。太感謝了。

Your next question comes from Vincent Andrews with Morgan Stanley. Please go ahead.

您的下一個問題來自摩根士丹利的文森特安德魯斯。請繼續。

Vince, and is your binders.

文斯，是你的活頁夾。

Your next question comes from Roger debts with Bank of America. Please go ahead.

你的下一個問題來自羅傑在美國銀行的債務。請繼續。

Thank you, and good morning. Two questions. The first one is for 2024.

謝謝你，早安。兩個問題。第一個是 2024 年。

In addition to EBITDA CapEx, what have you that you've identified what I refer to as other free cash flow items, you identified a potential $50 million insurance recovery are there any other so-called other cash flow items for 2024 that we should think about whether restructuring or other other items in here?

除了 EBITDA 資本支出之外，您還確定了我所說的其他自由現金流項目，您確定了潛在的 5000 萬美元保險賠償，我們是否應該考慮 2024 年還有其他所謂的其他現金流項目關於是否重組或其他其他項目在這裡？

Operating cash flow?

經營性現金流？

No, Roger, we don't have anything forecasted or expected at this point other than the insurance recovery that you mentioned.

不，羅傑，除了您提到的保險賠償之外，我們目前沒有任何預測或預期。

Got it. And then second is, I know it's early days, but just wanted to fill stuff in my model for 2020, how should we think about CapEx with relation to 2020 for same level or different? And perhaps the cash tax rate in 2024, you talked about South African mining operations. Does that repeat in 2025 or is it more back to a normal cash tax rate?

知道了。其次，我知道現在還為時過早，但只是想在 2020 年的模型中填充一些內容，我們應該如何考慮與 2020 年相同或不同水平的資本支出？也許是2024年的現金稅率，您談到了南非的採礦業務。這種情況會在 2025 年重演嗎？還是會回歸到正常的現金稅率？

Yes.

是的。

So look, we don't have a complete forecast for 2025 capital yet, but they'll probably be slightly lower than what we have. We still got some other mining mining projects going on and John you can comment on the tax, but to the extent we're still spending money in South Africa, that would be deductible.

因此，我們還沒有 2025 年資本的完整預測，但它們可能會略低於我們的預測。我們還有一些其他採礦項目正在進行，約翰，您可以對稅收發表評論，但就我們仍在南非花錢而言，這是可以扣除的。

So it's a little early to come up with what our tax position is going to be angry at that, John, and we will be spending if this is not a one year on investment in South Africa, it's a multiyear. So we would those expenses that we would spend on capital in South Africa would be deductible in 25.

因此，約翰，現在想出我們的稅收狀況會對此感到憤怒還為時過早，如果這不是在南非的一年投資，而是多年投資，我們將會支出。因此，我們希望在南非的資本支出可以在 25 年內扣除。

Thank you very much.

非常感謝。

Your next question comes from John McNulty with BMO Capital Markets. Please go ahead.

您的下一個問題來自 BMO 資本市場的 John McNulty。請繼續。

Yes, hi, guys.

是的，嗨，夥計們。

Sorry, just one one follow-up. So when I look at your inventory, your arm and the hit that it's had on working capital over the last couple of years, it's about 400 million in the last two years. If you returned to kind of more normal operating rates at the middle of this year, I guess how long realistically will it take to reverse that, that inventory drag where you see a source of funds from inventory? Can you clean all that up in whatever two to three years is it is it, hey, look, this could take a very long time because I'm just not sure with the mining side, how to think about how this all could work through and how quickly you could recapture some of that lost inventory?

抱歉，只是一一跟進。因此，當我查看你們的庫存、你們的手臂以及過去幾年對營運資金的影響時，我發現過去兩年大約有 4 億美元。如果你在今年年中恢復到更正常的開工率，我想實際上需要多長時間才能扭轉這種情況，即庫存拖累你從庫存中看到資金來源？你能在兩到三年內清理掉所有這些嗎？嘿，看，這可能需要很長時間，因為我不確定採礦方面如何考慮這一切如何解決您能多快收回部分丟失的庫存？

Yes, John, it's good point. As we mentioned, we have a long supply chain. So while in the past 18 months or so. We did slow down our pigment sites and brought down that inventory. We were running our mines relatively flat out, so build some feedstock inventory. If you take a look at 2024, we actually do see that reversing inventory. We do expect, and that's a bigger swing historically on what was driving the negative working capital change. And as you know, as we've guided, we do expect working capital to be positive and a lot of that is owing to come to inventory cashing out on that.

是的，約翰，這是個好觀點。正如我們所提到的，我們有一個很長的供應鏈。所以在過去18個月左右的時間。我們確實放慢了顏料網站的速度並減少了庫存。我們的礦山運作相對平穩，因此建立了一些原料庫存。如果你看看 2024 年，我們實際上確實看到了庫存逆轉。我們確實預計，從歷史上看，推動營運資本負變化的因素會出現更大的波動。如您所知，正如我們所指導的那樣，我們確實預計營運資金將為正值，其中很大一部分歸功於庫存兌現。

Well, you can guess can you get the full 400 million back? Or is there some reason why why that won't be the case? And I don't mean 24, I just missed there or are we at kind of a new level for one reason or another? Or should you be able to reverse that $400 million inventory headwind from the last two years?

那麼，你猜你能把這4億全部拿回來嗎？或者是否有某種原因導致情況並非如此？我指的不是 24 歲，我只是錯過了那裡，或者我們是否出於某種原因處於新的水平？或者您應該能夠扭轉過去兩年 4 億美元的庫存逆風嗎？

Yes, we'd we would expect that we would recover that over time nine, 24 very much, but it all definitely recover.

是的，我們預計我們會在九、二十四小時內恢復，但一切肯定都會恢復。

Got it. Thanks very much for the call.

知道了。非常感謝您的來電。

Thank you.

謝謝。

Your next question comes from Vincent Andrews with Morgan Stanley. Please go.

您的下一個問題來自摩根士丹利的文森特安德魯斯。請離開。

I thank you.

我謝謝你。

This is Turner Hendrix on for Vincent. In your slide, you mentioned that that February and March order books are tracking above strong January sales. Do you mind touching on what end markets or channels are driving the strength in and movements in inventory levels that you're seeing?

這是替補文森的特納·亨德里克斯。在幻燈片中，您提到二月和三月的訂單量高於一月的強勁銷售量。您是否介意談談哪些終端市場或通路正在推動您所看到的庫存水準的成長和變化？

Yes. Look.

是的。看。

So those up, it's basically across the entire market. So every region we're seeing additional volumes on. I mentioned that we're seeing again, North America didn't drop as much as it I think the other regions, and that's I'd say a little bit slower to picking back up. We referenced in the fourth quarter, we saw a little bit more seasonality, but we're also seeing North America pick up a little bit stronger in the first quarter. So I'd say it's across the board, and it's not specific to any particular end segments. So it's coatings, plastics, paper and specialty.

所以這些，基本上遍及整個市場。因此，我們在每個地區都看到了額外的銷售。我提到我們再次看到，北美的下降幅度沒有我想像的其他地區那麼大，而且我想說的是恢復速度要慢一些。我們在第四季度提到，我們看到了更多的季節性，但我們也看到北美在第一季回升了一點。所以我想說它是全面的，並且它不特定於任何特定的末端部分。包括塗料、塑膠、紙張和特殊產品。

Okay, great. Makes sense. Do you mind providing some additional color on what you're seeing for import and export trends?

好的，太好了。說得通。您介意提供一些關於您所看到的進出口趨勢的額外資訊嗎？

And if you have any details as it relates to freight costs if they're affecting those trends or the underlying macro across the regions, that would also be great.

如果您有任何與貨運成本相關的詳細資訊（如果它們影響這些趨勢或跨地區的基本宏觀），那就太好了。

Any specific regions you're referring to on imports and exports or just generically generally, it would be interesting to hear about Chinese exports or European imports broadly on both given Chinese export trends and the anti-dumping probe. That would also be of interest?

您所指的任何特定地區的進出口情​​況或一般性情況，考慮到中國出口趨勢和反傾銷調查，了解中國出口或歐洲進口的情況將會很有趣。這樣也會引起興趣嗎？

Yes.

是的。

So on China, over the last couple of months, we don't have actually January numbers yet. But I'd say November December, we've continued to see an uptick, which was not I'd say surprising, considering there was a an anti-dumping suit filed. So we've seen some additional exports coming out of China and Europe is obviously a big market for bringing in material from China. We've seen as far as some of the activity going on in Europe and other areas, as I referenced, some issues with imports and exports due to the congestion in the Red Sea. So for producers that are in Europe, I think they're actually getting a little benefit, a little bit of benefit from that depending upon where they're located and where they're shipping, but I wouldn't say there's significant and change in activity.

因此，在中國，過去幾個月我們還沒有實際的 1 月數據。但我想說的是，11 月 12 月，我們繼續看到上升，考慮到已提起反傾銷訴訟，我認為這並不令人驚訝。因此，我們看到中國有一些額外的出口，歐洲顯然是從中國進口材料的一個大市場。正如我所提到的，我們已經看到歐洲和其他地區正在進行的一些活動，由於紅海擁堵而出現了一些進出口問題。因此，對於歐洲的生產商來說，我認為他們實際上得到了一點好處，一點好處取決於他們所在的位置和運輸地點，但我不會說有重大變化在活動中。

Now on the freight, we are seeing some positive moves on freight. What's happening in the Red Sea is I'd say a bit more of a short-term anomaly. We're seeing some spot rates that are higher than what we put in our forecast. But historically, we've had over the course of the last 24 months, freight rates have gone up significantly, and we're starting to see those abate. And that's, I'd say, a tailwind for us as we think about our 24 forecast, although right now, some of those rates have been, I'd say, negatively impacted due to some of the activity that's happening in the Middle East.

現在在貨運方面，我們看到貨運出現了一些積極的變化。我想說，紅海正在發生的事情更像是短期異常現象。我們發現有些即期匯率高於我們的預測。但從歷史上看，在過去 24 個月裡，運費大幅上漲，但現在我們開始看到運費下降。我想說，當我們思考我們的 24 預測時，這對我們來說是一個順風車，儘管現在，我想說，由於中東發生的一些活動，其中一些利率受到了負面影響。

Great.

偉大的。

Thank you so much for the color.

非常感謝你的顏色。

I will now turn the call over to John Romano to close CYO.

我現在將把電話轉給約翰·羅馬諾 (John Romano)，以關閉 CYO。

Thank you, operator. Look, we're very confident in where we are with our company. Moving into 2024 and our vertical integration strategy we believe will continue to provide our competitive advantage. We remain optimistic in the short the long term for Tronox, the value creation from a lot of the projects that we're doing, including sustainable mining and upgrading solutions.

謝謝你，接線生。看，我們對我們公司的現狀非常有信心。進入 2024 年，我們相信我們的垂直整​​合策略將繼續提供我們的競爭優勢。我們對 Tronox 的短期和長期保持樂觀，我們正在進行的許多項目創造了價值，包括永續採礦和升級解決方案。

So I'd like to thank you all for your interest in Tronox and your support and have a great day.

因此，我要感謝大家對 Tronox 的興趣和支持，祝您有個愉快的一天。

Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that Please disconnect your lines.

女士們、先生們，今天的電話會議到此結束。我們感謝您的參與，並請斷開您的線路。