KRONOS WORLDWIDE, INC. REPORTS FOURTH QUARTER 2024 RESULTS

Dallas, Texas, March 06, 2025 (GLOBE NEWSWIRE) -- Kronos Worldwide, Inc. $(KRO)$ today reported a net loss of $13.2 million, or $.12 per share, in the fourth quarter of 2024 compared to a net loss of $5.3 million, or $.05 per share, in the fourth quarter of 2023. For the full year of 2024, Kronos Worldwide reported net income of $86.2 million, or $.75 per share, compared to a net loss of $49.1 million, or $.43 per share, for the full year of 2023. Net income decreased in the fourth quarter 2024 compared to the fourth quarter of 2023 primarily due to increases in the Company's income tax expense resulting from (i) final tax regulations on the treatment of certain currency translation gains and losses, which resulted in a non-cash deferred income tax expense of $16.5 million ($.14 per share) and (ii) the recognition of a deferred income tax asset valuation allowance related to the Company's Belgian net deferred tax assets, which resulted in a non-cash deferred income tax expense of $8.2 million ($.07 per share). Income before income taxes increased $24.9 million in the fourth quarter of 2024 as compared to the fourth quarter of 2023 due to higher income from operations as a result of the effects of higher sales and production volumes and lower production costs (primarily energy and raw materials). Net income increased in the full year of 2024 compared to full year of 2023 due to higher income from operations as a result of the effects of higher sales and production volumes and lower production costs (primarily energy and raw materials), partially offset by lower average TiO(2) selling prices. Comparability of our results was also impacted by the effects of changes in currency exchange rates. Our results of operations for the full year of 2023 were significantly impacted by reduced demand for TiO(2) in all major markets and unabsorbed fixed production as a result of production curtailments in response to the sharp decline in demand. Demand improved in all of our major markets in 2024 compared to 2023 and we increased production volumes accordingly, contributing to our improved profitability. As previously reported, effective July 16, 2024, we acquired the 50% joint venture interest in Louisiana Pigment Company, L.P. ("LPC") previously held by Venator Investments, Ltd. Prior to the acquisition, we held a 50% joint venture interest in LPC. Following the acquisition, LPC became a wholly-owned subsidiary of ours. We accounted for the acquisition as a business combination. The results of operations of LPC have been included in our results of operations beginning as of the acquisition date. Net income for the full year 2024 includes the recognition of a non-cash gain of $64.5 million ($50.9 million, or $.44 per share, net of income tax expense) associated with the remeasurement of our investment in LPC as a result of the acquisition.

Net sales of $423.1 million in the fourth quarter of 2024 were $23.0 million, or 6%, higher than in the fourth quarter of 2023. Net sales of $1.9 billion for the full year of 2024 were $220.6 million, or 13%, higher than the full year of 2023. Net sales increased in the fourth quarter of 2024 compared to the fourth quarter of 2023 primarily due to the effects of higher sales volumes due to strengthening demand for TiO(2) in all our major markets and higher average TiO(2) selling prices. Net sales increased for the full year of 2024 compared to the same period in 2023 primarily due to the net effects of higher sales volumes and lower average TiO(2) selling prices. TiO(2) sales volumes were 4% higher in the fourth quarter of 2024 as compared to the fourth quarter of 2023 and 20% higher in the full year of 2024 as compared to the full year of 2023. Sales volumes resulting from the LPC acquisition did not materially impact prior period comparisons. Average TiO(2) selling prices were 2% higher in the fourth quarter of 2024 (primarily from our European and export markets) as compared to the fourth quarter of 2023 but 5% lower in the full year of 2024 as compared to the full year of 2023. For the full year, changes in product sales mix negatively affected net sales, primarily due to changes in product sales mix in export markets in 2024 as compared to 2023. Changes in currency exchange rates had a nominal effect on net sales in the fourth quarter of 2024 as compared to the fourth quarter of 2023; however, changes in currency exchange rates (primarily the euro) increased our net sales by approximately $5 million in the full year of 2024 as compared to the full year of 2023. The table at the end of this press release shows how each of these items impacted net sales.

Our TiO(2) segment profit (see description of non-GAAP information below) in the fourth quarter of 2024 was $33.1 million as compared to a segment loss of $1.3 million in the fourth quarter of 2023. For the full year of 2024, our segment profit was $141.0 million as compared to a segment loss of $39.8 million in the full year of 2023. Segment profit increased in the fourth quarter of 2024 compared to the fourth quarter of 2023 primarily due to higher income from operations due to an increase in sales and production volumes, lower production costs (primarily energy and raw materials) and higher average TiO(2) selling prices. Segment profit increased for the full year of 2024 compared to the same period in 2023 primarily due to higher income from operations due to the net effects of an increase in sales and production volumes, lower production costs (primarily energy and raw materials) and lower average TiO(2) selling prices. Due to improved overall demand and a more favorable production cost environment, we increased our production rates to 96% of practical capacity utilization in the full year of 2024 (87%, 99%, 92% and 97% in the first, second, third and fourth quarters of 2024, respectively) compared to 72% in the full year of 2023 (76%, 64%, 73% and 75% in the first, second, third and fourth quarters of 2023, respectively). As a result, our unabsorbed fixed production costs in the full year of 2024 were $12 million (incurred in the first quarter) compared to $96 million in the full year of 2023. Sales and production volumes resulting from the LPC acquisition did not materially impact comparisons to the prior periods. During the third quarter of 2024, we completed the closure of our sulfate process line in Canada and our segment profit for the full year of 2024 includes non-cash charges of approximately $14 million related to accelerated depreciation and a charge of approximately $2 million related to workforce reductions. Our selling, general and administrative expense for the full year of 2024 includes $2.2 million of transaction costs incurred in connection with the LPC acquisition. Fluctuations in currency exchange rates (primarily the euro) increased our segment profit by approximately $10 million in the full year of 2024 as compared to 2023. Fluctuations in currency exchange rates had a nominal effect on segment profit in the fourth quarter of 2024 as compared to the fourth quarter of 2023.

Our net income (loss) before interest expense, income taxes and depreciation and amortization expense (EBITDA) (see description of non-GAAP information below) in the fourth quarter of 2024 was $41.7 million compared to EBITDA of $6.9 million in the fourth quarter of 2023. For the full year of 2024, our EBITDA was $252.9 million compared to EBITDA of ($7.2) million in the full year of 2023. EBITDA comparisons for the full year of 2024 were impacted by the $64.5 million non-cash gain associated with the remeasurement of our investment in LPC discussed above.

Interest expense for the full year of 2024 includes a charge of $1.5 million ($1.1 million, or $.01 per share, net of income tax benefit) for the write-off of deferred financing costs.

Our loss from operations in the full year of 2023 includes an insurance settlement gain related to a 2020 business interruption insurance claim of $2.5 million ($2.0 million, or $.02 per share, net of income tax expense), a fixed asset impairment related to the write-off of certain costs resulting from a capital project termination of $3.8 million ($2.8 million, or $.02 per share, net of income tax expense) and restructuring costs related to workforce reductions of $5.8 million ($4.3 million, or $.04 per share, net of income tax expense). Other components of net periodic pension and OPEB cost in 2023 includes a $1.3 million settlement loss incurred in the second quarter related to the termination and buy-out of our UK pension plan ($.9 million, or $.01 per share, net of income tax expense).

The statements in this release relating to matters that are not historical facts are forward-looking statements that represent management's beliefs and assumptions based on currently available information. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we cannot give any assurances that these expectations will prove to be correct. Such statements by their nature involve substantial risks and uncertainties that could significantly impact expected results, and actual future results could differ materially from those described in such forward-looking statements. While it is not possible to identify all factors, we continue to face many risks and uncertainties. The factors that could cause actual future results to differ materially include, but are not limited to, the following:

   -- Future supply and demand for our products; 
 
   -- Our ability to realize expected cost savings from strategic and 
      operational initiatives; 
 
   -- Our ability to integrate acquisitions, including LPC, into our operations 
      and realize expected synergies and innovations; 
 
   -- The extent of the dependence of certain of our businesses on certain 
      market sectors; 
 
   -- The cyclicality of our business; 
 
   -- Customer and producer inventory levels; 
 
   -- Unexpected or earlier-than-expected industry capacity expansion; 
 

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March 06, 2025 16:15 ET (21:15 GMT)