The Chemours Stock

The Chemours Company is a leading, global provider of performance chemicals that are key inputs in end-products and processes in a variety of industries.

The company delivers customized solutions with a wide range of industrial and specialty chemicals products for markets, including coatings, plastics, refrigeration and air conditioning, transportation, semiconductor and consumer electronics, general industrial, and oil and gas. The company’s principal products include titanium dioxide (TiO2) pigment, refrigerants, industrial fluoropolymer resins, and performance chemicals and intermediates.

Segments

The company operates through three segments: Titanium Technologies, Thermal & Specialized Solutions, and Advanced Performance Materials.

Titanium Technologies segment is a leading, global provider of TiO2 pigment, a premium white pigment used to deliver whiteness, brightness, opacity, durability, efficiency, and protection across a variety of applications.

Thermal & Specialized Solutions segment is a leading, global provider of refrigerants, thermal management solutions, propellants, blowing agents, and specialty solvents.

Advanced Performance Materials segment is a leading, global provider of high-end polymers and advanced materials that deliver unique attributes, including low friction coefficients, extreme temperature resistance, weather resistance, ultraviolet and chemical resistance, and electrical insulation.

The company operates 29 major production facilities located in nine countries and serves approximately 2,900 customers across a wide range of end-markets in approximately 120 countries. Many of the company’s commercial and industrial relationships span decades. The company’s customer base includes a diverse set of companies, many of which are leaders in their respective industries.

The company’s world-class product portfolio brings everyday convenience to virtually everything people touch in their daily lives, making its products and the solutions they enable both vital and essential. The company is committed to creating value for its customers and stakeholders around the world through innovative and sustainable solutions, environmental leadership, community impact and making Chemours the greatest place to work for every employee. The company’s global workforce, renowned for its deep and unmatched expertise, brings its chemistry to life, guided by five core values that form the bedrock foundation for how it operates: Customer Centricity – driving customer growth, and the company’s own, by understanding its customers’ needs and building long-lasting relationships with them; Refreshing Simplicity – cutting complexity by investing in what matters, and getting results faster; Collective Entrepreneurship – empowering its employees to act like they own its business, while embracing the power of inclusion and teamwork; Safety Obsession – living its steadfast belief that a safe workplace is a profitable workplace; and Unshakable Integrity – doing what’s right for its customers, colleagues, and communities – always.

The company’s core values, together with its company purpose and vision, underpin its commitment to its stakeholders to make chemistry as responsible as it is essential. In August 2022, the company announced its signed commitment with the Science Based Targets initiative (SBTi) to establish science-based targets for scopes 1, 2, and 3 GHG emissions .

Segments

In its Titanium Technologies segment, the company is a leading, global provider of TiO2 pigment, and aspire to be the most sustainable TiO2 enterprise in the world. Guided by decades of innovation, the company is one of the largest global producers of TiO2 pigment, using its proprietary chloride technology, its low-cost network of manufacturing facilities allows it to efficiently and cost-effectively serve its global customer base. The company is well-positioned to remain one of the lowest-cost, high-quality TiO2 pigment producers. At the same time, the company’s unique go-to-market strategy, Ti-Pure Value Stabilization (TVS), provides its customers with three differentiated channels to buy Ti-Pure TiO2. This combination of technology, strength, and commercial innovation allows the company to continue to meet its customers’ needs around the world.

In its Thermal & Specialized Solutions segment, the company is a leading, global provider of refrigerants, thermal management solutions, propellants, foam blowing agents, and specialty solvents. The company’s Thermal & Specialized Solutions segment has held a leading position in the refrigerants market since the commercial introduction of Freon. The company is a leader in the development of sustainable technologies like Opteon, one of the world’s lowest global warming potential (GWP) refrigerant brands, as governments around the world pass laws and regulations that make the use of low GWP refrigerants a requirement. In 2022, the company announced it plan to expand its Opteon capacity at its Corpus Christi, Texas facility by approximately 40% to help meet customer needs as they continue to transition to lower GWP refrigerants.

In its Advanced Performance Materials segment, the company is a leading, global provider of high-end polymers and advanced materials that deliver unique attributes, including chemical inertness, thermal stability, low friction, weather and corrosion resistance, extreme temperature stability, and unique di-electric properties. The company’s Advanced Performance Materials segment has a diversified offering of products that includes various specialty product solutions, membranes, industrial resins, and coatings. These product offerings position the business to serve a breadth of markets, segments, and applications, including electronics, communications, transportation, wire and cable, energy, oil and gas, and medical, among others, and its product offerings are fundamental to the future of clean energy and advanced electronics. In 2022, in support of the hydrogen economy, the company announced its plan to increase capacity and advance technology for Nafion ion exchange materials, which will be located at its manufacturing facility in Villers St. Paul, France.

Titanium Technologies segment

Titanium Technologies segment is a leading, global manufacturer of high-quality TiO2 pigment and aspires to be the most sustainable TiO2 supplier. This premium white pigment is used to deliver whiteness, brightness, opacity, durability, efficiency, and protection in applications, including architectural and industrial coatings, flexible and rigid plastic packaging, polyvinylchloride (PVC), laminate papers used for furniture and building materials, coated paper, and coated paperboard used for packaging. The company sells its TiO2 pigment under the Ti-Pure brand name. The company operates four TiO2 pigment production facilities: two in the U.S., one in Mexico, and one in Taiwan. In total, the company has a TiO2 pigment nameplate capacity of approximately 1.25 million metric tons per year. In addition, the company has a large-scale repackaging and distribution facility in Belgium. The company also operates mineral sands mining and/or separation operations in Starke, Florida, Nahunta, Georgia, Jesup, Georgia and Offerman, Georgia.

The company is one of a limited number of manufacturers operating a chloride process to produce TiO2 pigment. The company’s proprietary chloride technology enables it to operate plants at a much higher capacity than other chloride technology-based TiO2 pigment producers, as it uniquely utilizes a broad spectrum of titanium-bearing ore feedstocks to achieve one of the highest TiO2 pigment unit margins in its industry. This technology, which is in use at all of the company’s production facilities, provides it with one of the industry’s lowest manufacturing cost positions. The company’s R&D efforts focus on improving production processes, developing TiO2 pigment grades that help its customers achieve optimal cost and product performance to enhance total end-user value and meeting its sustainability goals in relation to the United Nations Sustainability Development Goals.

The company sells over 20 different grades of TiO2 pigment, with each grade tailored for targeted applications, including its latest Ti-Pure Sustainability (TS) series, a suite of products designed to advance sustainability. The company’s full portfolio of premium performance TiO2 pigment grades provide end-users with benefits beyond opacity, such as brighter colors, increased product durability and lifespan, improved efficiency for direct and downstream customers, and the brilliant whites achievable only through chloride-manufactured pigment.

The company has operated a titanium mine in Starke, Florida. The company is a major supplier of high-quality calcined zircon in North America, primarily focused on the precision investment casting industry, foundry, specialty applications, and ceramics. The company’s staurolite blasting abrasives are used in a variety of surface preparation applications, including steel preparation and maintenance and paint removal.

Competitors

The company’s major competitors within higher-performance pigments include Tronox Holdings plc, LB Group Co. Ltd., Venator Materials plc, Kronos Worldwide, Inc., and INEOS AG.

Sales, Marketing, and Distribution

The company sells the majority of its products through a direct sales force. In 2018, the company launched its TVS strategy. The company’s TVS strategy establishes a commercial framework that allows it to focus on enhancing durable, value-oriented customer relationships, while providing customers access to a predictable and reliable supply of high-quality TiO2. Customers can purchase Ti-Pure TiO2 either through long-term contracts or through Ti-Pure Flex. Launched in 2019, Ti-Pure Flex is an innovative channel that provides customers the unique ability to purchase Ti-Pure TiO2 via its web-based portal, the first of its kind in the industry. To further expand the company’s reach beyond these sales channels, it also utilizes third-party sales agents and distributors.

The company’s sales organization works to develop and maintain close relationships with key decision makers in its value chain. In addition to close purchasing relationships, its sales and technical service teams work together to develop relationships with all layers of its customers’ organizations to ensure that it meets its customers’ commercial and technical requirements. When appropriate, the company collaborates closely with customers to solve formulation or application problems by modifying product characteristics or developing new product grades.

To ensure efficient distribution, the company has a large fleet of railcars, which are predominantly used for outbound distribution of products in the U.S. and Canada. A dedicated logistics team, along with external partners, continually optimizes the assignment of the company’s transportation equipment for each product line and geographic region to maximize utilization and maintain an efficient supply chain.

Customers

Globally, the company serves approximately 500 customers through its Titanium Technologies segment. In 2022, the company’s 10 largest Titanium Technologies customers accounted for approximately 39% of the segment’s net sales, and one Titanium Technologies customer represented more than 10% of the segment’s net sales. The company’s larger customers are typically served through direct sales and tend to have medium-term to long-term contracts. The company serves its small-size and mid-size customers through a combination of its direct sales and distribution network. The company’s direct customers in the Titanium Technologies segment are producers of decorative coatings, automotive and industrial coatings, polyolefin masterbatches, PVC, engineering polymers, laminate paper, coatings paper, and coated paperboard. The company focuses on developing long-term partnerships with key market participants in each of these sectors. The company also delivers a high level of technical service to satisfy its customers’ specific needs, which helps it maintain strong customer relationships.

Seasonality

The demand for TiO2 pigment is subject to seasonality due to the influence of weather conditions and holiday seasons on some of the company’s applications, such as decorative coatings. As a result, the company’s TiO2 pigment sales volume is typically lowest in the first quarter (year ended December 31, 2022), highest in the second and third quarters, and moderate in the fourth quarter. This pattern applies to the entire TiO2 pigment market, but may vary by region, country, or application. The impacts of seasonality on demand for TiO2 pigment may also be altered by economic factors, such as changes in global GDP, global supply chain and logistics issues, and other factors.

Thermal & Specialized Solutions segment

Thermal & Specialized Solutions segment is a leading, global provider of refrigerants, thermal management solutions, propellants, foam blowing agents, and specialty solvents. The company has an industry-leading safety culture and apply world-class R&D and technical expertise to ensure that its operations run safely and reliably, and to improve its process technology.

Since the original chlorofluorocarbons (CFC)-based product was introduced, Thermal & Specialized Solutions has been at the forefront of new technology research for lower GWP and lesser ozone-depleting potential products, leading to the development of hydrochlorofluorocarbons (HCFC) and hydrofluorocarbons (HFC). The company has a leading position in HFC refrigerants under the brand name Freon, and it is a leader in the development of sustainable technologies like Opteon, a line of low GWP hydrofluoroolefin (HFO) refrigerants, which also have a near-zero ozone-depletion footprint. Opteon was initially developed in response to the European Union’s (EU) Mobile Air Conditioning Directive. The company’s Opteon branded portfolio of products is used in a broad range of applications, including automotive, air conditioning, commercial refrigeration, and foam blowing agents. This patented technology offers similar functionality to current HFC products, but meets or betters -mandated environmental standards and, in some cases, provides energy efficiency benefits.

Driven by the emerging megatrends of Climate Change, Decarbonization, and Energy Efficiency, together with environmental legislation being enacted across the U.S., Europe, Latin America, and Japan, the company commercialized Opteon in 2016. Growth in the company’s Thermal & Specialized Solutions segment is supported in part by the adoption of the American Innovation and Manufacturing Act (AIM Act) in the U.S. In 2022, the company announced its plan to expand its Opteon capacity at its Corpus Christi, Texas facility by approximately 40% to help meet customer needs as they continue to transition to lower GWP refrigerants.

Competitors

The company’s key competitors for the Thermal & Specialized Solutions segment include Honeywell International, Inc., Arkema S.A., Orbia, and Daikin Industries, Ltd

Sales, Marketing, and Distribution

With approximately 90 years of innovation and development in fluorine science, its technical, marketing, and sales teams around the world have deep expertise in the company’s products and their end-uses. The company works with customers to select the appropriate solutions to meet their technical performance needs. The company sells its products through direct channels and through resellers. Selling agreements vary by product line and markets served and include both spot-pricing arrangements and multi-year contracts with varying durations.

The company’s Thermal & Specialized Solutions segment maintains a large fleet of railcars, tank trucks, and containers to deliver its products and support its supply chain needs.

Customers

The company’s Thermal & Specialized Solutions segment serves approximately 900 customers and distributors globally, and in many instances, these commercial relationships have been in place for decades.

Seasonality

Thermal & Specialized Solutions’ refrigerant sales fluctuate by season, as sales in the first half of the year are generally higher than sales in the second half of the year due to increased demand for residential, commercial, and automotive air conditioning in the spring, which peaks in the summer months, and then declines in the fall and winter in the northern hemisphere. Mobile air conditioning demand is slightly higher in the first half of the year due to the timing of automotive production shutdowns in the second half of the year.

Advanced Performance Materials segment

Advanced Performance Materials segment draws on vast experience in fluoropolymer chemistry as a leading, global provider of performance solutions and advanced materials that solve challenging problems in emerging technologies and deliver unique capabilities in products and applications that people around the world use every day. The segment's diversified portfolio includes various specialty product solutions, membranes, industrial resins, and coatings. These product offerings position the business to serve a broad range of markets, including consumer electronics, semiconductors, digital communications, transportation, energy, oil and gas, and medical, among others.

The company’s products set the standard in a number of performance categories, including chemical inertness, thermal stability, low friction, weather and corrosion resistance, and di-electric properties. These performance advantages make the company’s polymers a material of choice, especially in complex applications and extreme environmental conditions. The company’s performance solutions portfolio includes differentiated offerings, such as those that are critical to many emerging technology areas, including hydrogen production and fuel cells, emerging battery technologies, advanced semi-conductor infrastructure, 5G data delivery, and connected electronic devices. The company’s advanced materials portfolio provides products which are essential to established technologies across a diverse range of markets and applications, including consumer goods, transportation and chemical processing.

The company’s Advanced Performance Materials products are sold under the brand names Teflon, Viton, Krytox, and Nafion. Teflon coatings, resins, additives, and films serve as the key underpinning for a variety of industrial and commercial applications, including semiconductor infrastructure. Viton fluoro elastomers are used in automotive, consumer electronics, chemical processing, oil and gas, petroleum refining and transportation, and aircraft and aerospace applications. The company’s Krytox-branded lubricants are used in a broad range of industrial applications, including bearings, automotive friction management, and electric motors. Nafion membranes are critical components in chlor-alkali processing and flow batteries, as well as the hydrogen electrolyzers and fuel cells which underpin the hydrogen economy. In anticipation of significant growth in the hydrogen economy through 2030, in 2022, the company announced its plan to increase capacity and advance technology for Nafion ion exchange materials, which will be located at its manufacturing facility in Villers St. Paul, France.

The company’s Advanced Performance Materials segment uses a market-back approach to drive technology development. The company’s innovations are underpinned by deep technical knowledge and experience in fluoropolymer chemistry. The company leverages its state-of-the-art R&D facilities at its 312,000-square-foot R&D facility on the Science, Technology, and Advanced Research campus of the University of Delaware in Newark, Delaware (Chemours Discovery Hub) to drive faster development on a global scale. The company also participates in a broad array of industry consortia and collaborate with leading academics across a variety of disciplines to drive fundamental R&D in the materials space.

The segment is well positioned to capture future growth through the combination of the company’s unique product capabilities and market-driven product development process. Advanced Performance Materials will benefit long-term from secular growth in clean energy and advanced electronics.

Competitors

The company’s key competitors for this segment include Daikin Industries, Ltd., 3M Company, Solvay, S.A., AGC Inc., and Dongyue Group Co., Ltd.

Sales, Marketing, and Distribution

With approximately 90 years of innovation and development in fluorine science, the company’s technical, marketing, and sales teams around the world have deep expertise in its products and their end-uses. The company works with customers to select the appropriate fluoropolymers or other advanced performance materials to meet their technical performance needs based on their intended performance-in-use requirements. The company sells its products through direct and indirect channels, and the duration of its selling agreements vary by product line and markets served.

The company’s Advanced Performance Materials segment maintains a limited fleet of railcars, tank trucks, containers, and totes to deliver its products and support its supply chain needs. The company manages its fleet to ensure it is appropriately sized to meet market demand while maintaining flexibility.

Customers

The company’s Advanced Performance Materials segment serves approximately 1,300 customers and distributors globally and in many instances, these commercial relationships have been in place for decades.

Seasonality

The Advanced Performance Materials segment has historically seen some seasonal effects with lower sales in the fourth quarter, with planned maintenance activities at the company’s own sites and at certain customers typically occurring during this period.

Intellectual Property

Intellectual property, including trade secrets, certain patents, trademarks, copyrights, know-how, and other proprietary rights, is a critical part of maintaining the company’s technology leadership and competitive edge. The company’s business strategy is to file patent and trademark applications globally for proprietary new product and application development technologies, and it works actively on a global basis to create, protect, and enforces its intellectual property rights.

Within its Titanium Technologies segment’s intellectual property portfolio, the company considers its Ti-Pure trademark to be a valuable asset. The company has registered the Ti-Pure trademark in a number of countries.

The company’s Thermal & Specialized Solutions segment is a technology leader in the markets in which it participates. The company maintains a large fluorochemicals patent portfolio. The company considers its Opteon and Freon trademarks used in the Thermal & Specialized Solutions segment to be valuable assets.

The company’s Advanced Performance Materials segment possesses extensive know-how and trade secrets related to manufacturing technologies for a broad range of specialized fluoropolymers, as well as application development technology for fluoropolymers based on comprehensive knowledge of customer applications. The company holds patents relating to manufacturing for certain products with high quality, specifications and purity as required by the electronics, communications, automotive, wire and cable, and other industries. Additionally, the company’s Advanced Performance Materials segment is a leader in and holds patents relating to non-fluorinated materials for use as durable water repellants for garments and other uses. In the company’s Advanced Performance Materials segment’s intellectual property portfolio, it considers its Teflon, Viton, Nafion, and Krytox trademarks to be valuable assets.

The protections afforded under the company’s patents and trademarks vary based on country, scope of individual patent, and trademark coverage, as well as the availability of legal remedies in each country. The company’s patents, in the aggregate, are believed to be of material importance to its business. The company’s proprietary process technology can be a source of incremental income through licensing arrangements.

Research and Development

The company’s research and development expenses included $118 million for the year ended December 31, 2022.

History

The company was founded in the state of Delaware in 2014. The company was incorporated in 2014. It was formerly known as Performance Operations, LLC and changed its name to The Chemours Company in 2014.