Tronox Holdings plc · NYSE:TROX
Tronox — 2007 Leveraged Finance Conference
20 slides from Tronox's conference presentation, May 10, 2007
Slide 1: Building a more competitive company
Buildinga more competitive company 2007 Leveraged Finance Conference May 9, 2007
Slide 2: Forward-Looking Statement
Forward-Looking Statement Tronox makes certain forward-looking statements in this presentation that are subject to risks and uncertainties. These statements are based on the beliefs and assumptions of our management and on information currently available to our management at the time of such stateme
Slide 3: Tronox Incorporated Snapshot
Tronox Incorporated Snapshot NYSE Listed: TRX, TRX.B 40 Years Operating Experience Market Capitalization: $543MM Debt: $538MM 2006 Sales Revenue: $1.4 Billion Primary Product: Titanium Dioxide (TiO2) 3rd largest global producer Electrolytic Chemicals Manganese dioxide Sodium chlorate Boron Headquart
Slide 4: TiO2 Pigment
TiO2 Pigment Quality-of-Life Product, No Effective Substitutes Unsurpassed Opacifying and Whitening Properties Paints & coatings, plastics, paper, consumer products and specialties Semi-specialty, differentiated and frequently customized customized customized customized customized customized customi
Slide 5: Global Producer / Strong Leadership Position
DuPont Millennium Tronox Huntsman Kronos Others East 0.2 0.13 0.12 0.1 0.1 0.35 Global Producer / Strong Leadership Position Highly Concentrated Industry - Top 5 Producers Account for ~65% of Global Production 3rd largest global producer Leading Supplier to Global Customers in Multiple Regions of th
Slide 6: Strategic Focus
Strategic Focus Move Tronox to Top-Quartile Performance Project Cornerstone Focus on Growth 3% per year Brownfield expansion to service high-growth Asian market Reduce Debt to Cap: Target = 35% - 40% Exploring opportunities to optimize value of Uerdingen plant Land sales Excess free cash flow Evalua
Slide 7: Cornerstone Execution
Cornerstone Execution Cash Cost Reductions Land Sales & Capital Program Inventory, Receivables & Payables Program * Does not include 2,200-acre LandWell sales Status Summary Teams on track or ahead of schedule Remain committed to target attainment Beginning to realize benefits in the bottom line $MM
Slide 8: Global TiO2 Manufacturing Operations
Location M Tonnes Hamilton 225 Savannah 110 Western Australia 110 Botlek 90 Uerdingen (Sulfate) 107 Global Capacity 642 Global TiO2 Manufacturing Operations Nameplate Capacity (1) (1) Reflects 100% of the production capacity of the Kwinana pigment plant, which is 50% owned by Tronox and 50% by the j
Slide 9: Integrated Western Australia Operations
Integrated Western Australia Operations Integrated Western Australia Operations Chandala Synthetic Rutile Facility Cooljarloo Mine Kwinana Pigment Facility
Slide 10: Uerdingen, Germany
Uerdingen, Germany World-Class Sulfate Process New High Ilmenite Feed Process Annual Capacity = 107,000 MT Strategic Option Status: Robert W. Baird Investment Banker Offering memorandum sent Indicative bids due in May Expect sale and purchase agreement completed by midyear assuming we get value for
Slide 11: Land Sales Highlights
Land Sales Highlights Henderson, Nevada 2,200-acre development Tronox 100% owned land ~150 acres LandWell Company participation Tronox U.S. portfolio $250MM Target Over 4 Years on Track
Slide 12: Debt Pay Down
Debt Pay Down $0.5 Million Payment $11.1 Million Additional Payment in April 2006 2007 East 190 178.4 ($MM) Term Loan $190 $178.4 2006 2007 Q4 April
Slide 13: First-Quarter Preliminary Results
First-Quarter Preliminary Results Net Sales Cost of Sales Gross Margin Income (Loss) From Continuing Ops. Diluted EPS From Continuing Ops. First Quarter 2007 First Quarter 2006 339.1 301.3 37.8 (9.0) (0.22) Higher Per Unit Costs Associated with Lower Production, Increased DD&A and Uerdingen HIF Star
Slide 14: Process Chemicals & Energy Outlook
Process Chemicals & Energy Outlook United States Chlorine prices continue to soften Caustic increased in Q1, offset by lower usage European Union Process chemical prices increasing in European Union Energy prices moving higher 2007 U.S. Natural Gas Hedges Q2 Q3 Q4 Amount hedged ~50% ~30% ~30% Weight
Slide 15: Financial Items
Financial Items Financial Items ($MM) 1Q 2007 2007 Outlook Interest Expense $12.3 $48 to $52 Capital Expenditures $14 $81 Effective Tax Rate -5% <10% SG&A Expense $36 $130 to $135* Increase in SG&A forecast represents ~$5MM net reclass into net sales. No impact to operating profit. *
Slide 16: Environmental Reserves and Receivables
Environmental Reserves = $221MM Receivables = $ 71MM* *Excludes anticipated future receivables of $41MM from DOE for West Chicago 2007 Net Cash Spend Projected = $40MM to $45MM As of 3/31/2007
Slide 17: Legacy Sites Financial Summary
Legacy Sites Financial Summary ($MM) Historical Cash Spend 2001 2002 2003 2004 2005 2006 2007 (1) Additions to the reserves may be required as additional information is obtained that enables Tronox to better estimate its liabilities, including any liabilities at sites now under review. $40-45 Estima
Slide 18: Current Macro-Economic Situation
Current Macro-Economic Situation ? GDP Regional Health Gauge (major country proxy) World 3.3% 2.9% 5.2% 3.9% 2006 Estimate Source: Consensus Economics 2.4% 2.5% 4.8% 3.3% 2007 Forecast Germany China United States Production hours Unemployment claims Consumer goods orders Capital goods orders Vendor
Slide 19: Outlook
Outlook 2007 Global TiO2 Market Strong fundamentals in Asia-Pacific and Europe Optimistic for U.S. rebound in demand second half 2007 - 2008 Ongoing Project Cornerstone improvements to baseline business Focus on growing chloride capacity in Asia-Pacific 2008+ Favorable industry supply / demand dynam
Slide 20: Building a more competitive company
Buildinga more competitive company 2007 Leveraged Finance Conference May 9, 2007