Trinseo Reports Third Quarter 2024 Financial Results and Provides Fourth Quarter Outlook
Trinseo (NYSE: TSE) reported a third quarter 2024 net loss of $87 million ($2.47 per share), with net sales of $868 million, down 1% from prior year. The company posted Adjusted EBITDA of $66 million, representing a $25 million increase from the previous year. The quarter saw improved results across all business segments except Americas Styrenics. The company announced restructuring initiatives expected to yield cost savings of $25 million in 2025 and $30 million by end of 2026. Cash position stood at $167 million with $177 million additional available liquidity. Fourth quarter 2024 outlook projects net loss between $81-71 million and Adjusted EBITDA of $40-50 million.
Trinseo (NYSE: TSE) ha riportato una perdita netta di $87 milioni nel terzo trimestre del 2024 ($2,47 per azione), con vendite nette di $868 milioni, in calo dell'1% rispetto all’anno precedente. L’azienda ha registrato un EBITDA rettificato di $66 milioni, che rappresenta un aumento di $25 milioni rispetto all’anno precedente. Il trimestre ha visto risultati migliorati in tutti i segmenti aziendali, ad eccezione di Americas Styrenics. L’azienda ha annunciato iniziative di ristrutturazione previste per generare risparmi sui costi di $25 milioni nel 2025 e $30 milioni entro la fine del 2026. La posizione di liquidità era di $167 milioni, con ulteriori $177 milioni di liquidità disponibile. Le previsioni per il quarto trimestre del 2024 indicano una perdita netta compresa tra $81 e $71 milioni e un EBITDA rettificato di $40-50 milioni.
Trinseo (NYSE: TSE) reportó una pérdida neta de $87 millones en el tercer trimestre de 2024 ($2.47 por acción), con ventas netas de $868 millones, una disminución del 1% con respecto al año anterior. La empresa presentó un EBITDA ajustado de $66 millones, lo que representa un aumento de $25 millones respecto al año anterior. El trimestre mostró resultados mejorados en todos los segmentos de negocio, excepto en Americas Styrenics. La empresa anunció iniciativas de reestructuración que se espera generen ahorros de costos de $25 millones en 2025 y $30 millones para finales de 2026. La posición de efectivo se situó en $167 millones, con $177 millones de liquidez adicional disponible. Las proyecciones para el cuarto trimestre de 2024 anticipan una pérdida neta entre $81 y $71 millones y un EBITDA ajustado de $40 a $50 millones.
트린시오 (NYSE: TSE)는 2024년 3분기에 $87백만의 순손실($2.47 주당)을 보고했으며, 순매출은 $868백만으로 전년 대비 1% 감소했습니다. 회사는 조정된 EBITDA $66백만을 기록하여 전년 대비 $25백만 증가했습니다. 이번 분기는 아메리카 스티렌을 제외한 모든 사업 부문에서 개선된 결과를 보였습니다. 회사는 2025년까지 $25백만, 2026년 말까지 $30백만의 비용 절감을 예상하는 구조조정 계획을 발표했습니다. 현금 위치는 $167백만이며 추가적인 유동성이 $177백만 있습니다. 2024년 4분기 전망은 순손실이 $81백만에서 $71백만 사이와 조정된 EBITDA가 $40백만에서 $50백만 사이일 것으로 예측하고 있습니다.
Trinseo (NYSE: TSE) a signalé une perte nette de 87 millions de dollars au troisième trimestre de 2024 (2,47 $ par action), avec des ventes nettes de 868 millions de dollars, en baisse de 1 % par rapport à l'année précédente. L'entreprise a enregistré un EBITDA ajusté de 66 millions de dollars, représentant une augmentation de 25 millions de dollars par rapport à l'année précédente. Le trimestre a connu des résultats améliorés dans tous les segments d'activité, à l'exception des Americas Styrenics. L'entreprise a annoncé des initiatives de restructuration qui devraient générer des économies de coûts de 25 millions de dollars d'ici 2025 et de 30 millions de dollars d'ici la fin de 2026. La position de trésorerie était de 167 millions de dollars, avec 177 millions de dollars de liquidités supplémentaires disponibles. Les projections pour le quatrième trimestre de 2024 anticipent une perte nette comprise entre 81 et 71 millions de dollars et un EBITDA ajusté de 40 à 50 millions de dollars.
Trinseo (NYSE: TSE) meldete im dritten Quartal 2024 einen Nettverlust von 87 Millionen USD (2,47 USD pro Aktie) bei Nettoumsätzen von 868 Millionen USD, was einem Rückgang von 1 % im Vergleich zum Vorjahr entspricht. Das Unternehmen verzeichnete ein bereinigtes EBITDA von 66 Millionen USD, was einen Anstieg von 25 Millionen USD im Vergleich zum Vorjahr darstellt. Das Quartal brachte in allen Geschäftsbereichen außer Amerikas Styrenics verbesserte Ergebnisse. Das Unternehmen gab Restrukturierungsinitiativen bekannt, die voraussichtlich Einsparungen von 25 Millionen USD bis 2025 und von 30 Millionen USD bis Ende 2026 bringen werden. Die Liquiditätsposition betrug 167 Millionen USD mit zusätzlichen 177 Millionen USD verfügbarer Liquidität. Der Ausblick für das vierte Quartal 2024 prognostiziert einen Nettverlust zwischen 81 und 71 Millionen USD sowie ein bereinigtes EBITDA von 40 bis 50 Millionen USD.
- Adjusted EBITDA increased by $25 million year-over-year to $66 million
- Sequential Free Cash Flow improvement of $53 million
- Restructuring initiatives expected to save $25 million in 2025
- Strong liquidity position with $167 million cash and $177 million available credit
- Net loss widened to $87 million from $38 million year-over-year
- Negative Free Cash Flow of $3 million
- Net sales decreased 1% to $868 million
- Continued weak demand in building, construction and appliances markets
- Americas Styrenics segment impacted by unplanned outages
Insights
The Q3 results reveal significant challenges with a net loss of
The negative free cash flow of
Market conditions remain challenging across multiple segments. The intentional reduction in Polystyrene volumes (
The Q4 outlook projecting
Third Quarter 2024 and Other Highlights
-
Net loss of
, including pre-tax restructuring and other charges of$87 million related to recently announced restructuring initiatives, and EPS of negative$26 million $2.47 -
Adjusted EBITDA* of
was$66 million higher than prior year$25 million -
Cash provided by operations of
and capital expenditures of$9 million resulted in Free Cash Flow* of negative$12 million , a sequential improvement of$3 million . Third quarter Free Cash Flow* included a$53 million decrease in trade working capital$16 million -
Third quarter ending cash of
, of which$167 million was restricted, with approximately$2 million of additional available liquidity under two committed financing facilities with continued focus on cash management and liquidity$177 million -
Announced restructuring initiatives focused on the consolidation of business management and support function roles, which are expected to result in cost savings of
in 2025 and full run rate savings of$25 million by the end of 2026$30 million
|
|
|
|
|
|
|||
|
|
Three Months Ended |
||||||
|
|
September 30, |
||||||
$millions, except per share data |
|
2024 |
|
2023 |
||||
Net Sales |
|
$ |
868 |
|
|
$ |
879 |
|
Net Loss |
|
|
(87 |
) |
|
|
(38 |
) |
Diluted EPS ($) |
|
|
(2.47 |
) |
|
|
(1.09 |
) |
Adjusted Net Loss* |
|
|
(58 |
) |
|
|
(36 |
) |
Adjusted EPS ($)* |
|
|
(1.62 |
) |
|
|
(1.03 |
) |
EBITDA* |
|
|
37 |
|
|
|
29 |
|
Adjusted EBITDA* |
|
|
66 |
|
|
|
41 |
|
*For a reconciliation of EBITDA, Adjusted EBITDA, and Adjusted Net Loss, all of which are non-GAAP measures, to Net Loss, as well as a reconciliation of Free Cash Flow and Adjusted EPS, see Notes 2 and 3 to the financial statements included below.
Trinseo (NYSE: TSE), a specialty material solutions provider, today reported its third quarter 2024 financial results. Net sales of
Third quarter net loss of
Commenting on the Company’s third quarter performance, Frank Bozich, President and Chief Executive Officer of Trinseo, said, “As expected, market conditions and Adjusted EBITDA were sequentially similar to the prior quarter. Despite continued weak demand in many of our end markets, particularly building and construction and appliances, we saw significant year-over-year profitability improvement largely as a result of our restructuring actions and continued moderation of European input costs.”
Third Quarter Results and Commentary by Business Segment
-
Engineered Materials net sales of
for the quarter increased$207 million 12% versus prior year including a6% impact from higher sales volume primarily from higher sales of compounds for consumer electronics and medical applications. Additionally, higher price, due to favorable product mix and higher MMA market prices, resulted in a6% increase. Adjusted EBITDA of was$25 million above prior year due to higher margins from moderating input costs and a favorable net timing variance, as well as higher sales volumes.$20 million -
Latex Binders net sales of
for the quarter increased$242 million 8% versus prior year as a4% impact from lower volumes, primarily in paper and carpet applications inAsia andEurope , was more than offset by a12% impact from higher price from the pass-through of higher raw material costs. Adjusted EBITDA of was$26 million above prior year due to higher margin from the exit of styrene production in Terneuzen as well as a favorable net timing variance. While total sales volume decreased, the Adjusted EBITDA impact was neutral because of improved regional and product mix. Sales volumes sold to CASE applications accounted for$8 million 12% of total segment volumes for the second quarter in a row and increased6% over prior year. -
Plastics Solutions net sales of
for the quarter were$268 million 3% above prior year from higher price due to the pass-through of higher raw material costs. Adjusted EBITDA of was$28 million above prior year due to higher margin from the exit of styrene production in Terneuzen as well as higher fixed cost absorption related to building inventory ahead of the Stade,$11 million Germany virgin polycarbonate closure. This inventory build is expected to reverse in the fourth quarter. -
Polystyrene net sales of
for the quarter were$151 million 28% below prior year including a35% impact from lower sales volume. This was a result of lower styrene-related sales following the closure of Terneuzen,the Netherlands styrene production facility, and an intentional reduction of low-margin sales to optimize plant operations and sales mix. This was partially offset by a7% impact from higher price from the pass-through of higher styrene costs. Adjusted EBITDA of was$4 million above prior year as higher margins and lower fixed costs from the exit of styrene production in Terneuzen was partially offset by lower sales volumes.$5 million -
Americas Styrenics Adjusted EBITDA of
for the quarter was$4 million below prior year due to unplanned outages and lower styrene margins.$15 million
2024 Outlook
-
Fourth quarter 2024 net loss of
to$81 million $71 million -
Fourth quarter 2024 Adjusted EBITDA of
to$40 million $50 million
Commenting on the fourth quarter outlook, Bozich said, “We expect Adjusted EBITDA to be sequentially lower from year-end seasonality, but still higher than the prior year due to the benefits from our restructuring initiatives. We also expect free cash flow to turn positive in the fourth quarter due to typical seasonal working capital improvements.”
Bozich continued, “While we are pleased to see a sustained higher level of profitability, low demand has persisted in many of our end markets and the timing of a broad market improvement is uncertain. Therefore, we made the difficult decision to take additional restructuring actions including the consolidation of business management and support-function roles, and the decision to exit virgin polycarbonate production at our facility in Stade. While decisions like these are never easy, we believe they will result in a more streamlined organizational structure and manufacturing footprint against a challenging macroeconomic backdrop that is beyond our control.”
Conference Call and Webcast Information
Trinseo will host a conference call to discuss its third quarter 2024 financial results on Thursday, November 7, 2024 at 10 a.m. Eastern Time.
Commenting on results will be Frank Bozich, President and Chief Executive Officer, David Stasse, Executive Vice President and Chief Financial Officer, and Bee van Kessel, Senior Vice President, Corporate Finance and Investor Relations.
For those interested in asking questions during the Q&A session, please register using the following link:
For those interested in listening only, please register for the webcast using the following link:
After registering for the conference call, you will receive a confirmation email with a meeting invitation and information for entry. Registration is open through the live call, but it is advised that you register in advance to ensure you are connected for the full call.
Trinseo has posted its third quarter 2024 financial results on the Company’s Investor Relations website. The presentation slides will also be made available in the webcast player prior to the conference call. The Company will also furnish copies of the financial results press release and presentation slides to investors by means of a Form 8-K filing with the
A replay of the conference call and transcript will be archived on the Company’s Investor Relations website shortly following the conference call. The replay will be available until November 7, 2025.
About Trinseo
Trinseo (NYSE: TSE), a specialty material solutions provider, partners with companies to bring ideas to life in an imaginative, smart and sustainably focused manner by combining its premier expertise, forward-looking innovations and best-in-class materials to unlock value for companies and consumers.
From design to manufacturing, Trinseo taps into decades of experience in diverse material solutions to address customers’ unique challenges in a wide range of industries, including building and construction, consumer goods, medical and mobility.
Trinseo’s employees bring endless creativity to reimagining the possibilities with clients all over the world from the company’s locations in
Use of non-GAAP measures
In addition to using standard measures of performance and liquidity that are recognized in accordance with accounting principles generally accepted in
Cautionary Note on Forward-Looking Statements
This press release may contain forward-looking statements including, without limitation, statements concerning plans, objectives, goals, projections, forecasts, strategies, future events or performance, and underlying assumptions and other statements, which are not statements of historical facts or guarantees or assurances of future performance. Forward-looking statements may be identified by the use of words like “expect,” “anticipate,” “believe,” “intend,” “forecast,” “outlook,” “will,” “may,” “might,” “see,” “tend,” “assume,” “potential,” “likely,” “target,” “plan,” “contemplate,” “seek,” “attempt,” “should,” “could,” “would” or expressions of similar meaning. Forward-looking statements reflect management’s evaluation of information currently available and are based on our current expectations and assumptions regarding our business, the economy, our current indebtedness, and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Factors that might cause future results to differ from those expressed by the forward-looking statements include, but are not limited to, our ability to successfully implement proposed restructuring initiatives, including the closure of certain plants and production lines, and to successfully generate cost savings through restructuring and cost reduction initiatives; our ability to successfully execute our business and transformation strategy; the timing of, and our ability to complete, the sale of our interest in Americas Styrenics; increased costs or disruption in the supply of raw materials; deterioration of our credit profile limiting our access to commercial credit; increased energy costs; compliance with laws and regulations impacting our business; any disruptions in production at our chemical manufacturing facilities, including those resulting from accidental spills or discharges; conditions in the global economy and capital markets; our current and future levels of indebtedness and ability to service our debt; our ability to meet the covenants under our existing indebtedness; our ability to generate cash flows from operations and achieve our forecasted cash flows; and those discussed in our Annual Report on Form 10-K, under Part I, Item 1A —"Risk Factors" and elsewhere in our other reports, filings and furnishings made with the
TRINSEO PLC
Condensed Consolidated Statements of Operations
(In millions, except per share data)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
|
September 30, |
|
September 30, |
||||||||||||
|
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
Net sales |
|
$ |
867.7 |
|
|
$ |
879.0 |
|
|
$ |
2,691.7 |
|
|
$ |
2,837.9 |
|
Cost of sales |
|
|
787.1 |
|
|
|
847.7 |
|
|
|
2,482.1 |
|
|
|
2,715.9 |
|
Gross profit |
|
|
80.6 |
|
|
|
31.3 |
|
|
|
209.6 |
|
|
|
122.0 |
|
Selling, general and administrative expenses |
|
|
97.0 |
|
|
|
66.6 |
|
|
|
237.2 |
|
|
|
205.1 |
|
Equity in earnings of unconsolidated affiliate |
|
|
4.0 |
|
|
|
19.0 |
|
|
|
25.8 |
|
|
|
49.2 |
|
Impairment and other charges |
|
|
— |
|
|
|
0.1 |
|
|
|
— |
|
|
|
349.5 |
|
Operating loss |
|
|
(12.4 |
) |
|
|
(16.4 |
) |
|
|
(1.8 |
) |
|
|
(383.4 |
) |
Interest expense, net |
|
|
72.3 |
|
|
|
46.6 |
|
|
|
200.0 |
|
|
|
125.1 |
|
Loss on extinguishment of long-term debt |
|
|
0.6 |
|
|
|
6.3 |
|
|
|
0.6 |
|
|
|
6.3 |
|
Other income, net |
|
|
(1.4 |
) |
|
|
(13.2 |
) |
|
|
(0.9 |
) |
|
|
(19.0 |
) |
Loss before income taxes |
|
|
(83.9 |
) |
|
|
(56.1 |
) |
|
|
(201.5 |
) |
|
|
(495.8 |
) |
Provision for (benefit from) income taxes |
|
|
3.4 |
|
|
|
(17.7 |
) |
|
|
29.1 |
|
|
|
(59.5 |
) |
Net loss |
|
$ |
(87.3 |
) |
|
$ |
(38.4 |
) |
|
$ |
(230.6 |
) |
|
$ |
(436.3 |
) |
Weighted average shares- basic |
|
|
35.4 |
|
|
|
35.2 |
|
|
|
35.3 |
|
|
|
35.1 |
|
Net loss per share- basic |
|
$ |
(2.47 |
) |
|
$ |
(1.09 |
) |
|
$ |
(6.53 |
) |
|
$ |
(12.42 |
) |
Weighted average shares- diluted |
|
|
35.4 |
|
|
|
35.2 |
|
|
|
35.3 |
|
|
|
35.1 |
|
Net loss per share- diluted |
|
$ |
(2.47 |
) |
|
$ |
(1.09 |
) |
|
$ |
(6.53 |
) |
|
$ |
(12.42 |
) |
TRINSEO PLC
Condensed Consolidated Balance Sheets
(In millions)
(Unaudited)
|
|
|
|
|
|
|
||
|
|
September 30, |
|
December 31, |
||||
|
|
2024 |
|
2023 |
||||
Assets |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
165.3 |
|
|
$ |
259.1 |
|
Accounts receivable, net of allowance |
|
|
474.5 |
|
|
|
490.8 |
|
Inventories |
|
|
434.8 |
|
|
|
404.7 |
|
Other current assets |
|
|
45.1 |
|
|
|
39.5 |
|
Investments in unconsolidated affiliate |
|
|
263.0 |
|
|
|
252.2 |
|
Property, plant, equipment, goodwill, and other intangible assets, net |
|
|
1,314.9 |
|
|
|
1,401.4 |
|
Right-of-use assets - operating, net |
|
|
65.6 |
|
|
|
65.3 |
|
Other long-term assets |
|
|
119.6 |
|
|
|
116.2 |
|
Total assets |
|
$ |
2,882.8 |
|
|
$ |
3,029.2 |
|
Liabilities and shareholders’ equity |
|
|
|
|
|
|
||
Current liabilities |
|
|
814.2 |
|
|
|
672.6 |
|
Long-term debt, net of unamortized deferred financing fees |
|
|
2,187.3 |
|
|
|
2,277.6 |
|
Noncurrent lease liabilities - operating |
|
|
54.3 |
|
|
|
51.7 |
|
Other noncurrent obligations |
|
|
307.0 |
|
|
|
295.3 |
|
Shareholders’ equity |
|
|
(480.0 |
) |
|
|
(268.0 |
) |
Total liabilities and shareholders’ equity |
|
$ |
2,882.8 |
|
|
$ |
3,029.2 |
|
TRINSEO PLC
Condensed Consolidated Statements of Cash Flows
(In millions)
(Unaudited)
|
|
|
|
|
|
|
||
|
|
Nine Months Ended |
||||||
|
|
September 30, |
||||||
|
|
2024 |
|
2023 |
||||
Cash flows from operating activities |
|
|
|
|
|
|
||
Cash provided by (used in) operating activities |
|
$ |
(99.3 |
) |
|
$ |
131.2 |
|
|
|
|
|
|
|
|
||
Cash flows from investing activities |
|
|
|
|
|
|
||
Capital expenditures |
|
|
(42.1 |
) |
|
|
(49.1 |
) |
Proceeds from the sale of businesses and other assets |
|
|
8.2 |
|
|
|
38.0 |
|
Cash used in investing activities |
|
|
(33.9 |
) |
|
|
(11.1 |
) |
|
|
|
|
|
|
|
||
Cash flows from financing activities |
|
|
|
|
|
|
||
Deferred financing fees |
|
|
(4.6 |
) |
|
|
(9.5 |
) |
Short-term borrowings, net |
|
|
(14.0 |
) |
|
|
(8.9 |
) |
Dividends paid |
|
|
(1.3 |
) |
|
|
(17.6 |
) |
Proceeds from exercise of option awards |
|
|
— |
|
|
|
0.1 |
|
Withholding taxes paid on restricted share units |
|
|
— |
|
|
|
(2.0 |
) |
Acquisition-related contingent consideration payment |
|
|
(0.7 |
) |
|
|
(1.2 |
) |
Net proceeds from issuance of 2028 Refinance Term Loans |
|
|
— |
|
|
|
1,044.9 |
|
Repurchases and repayments of long-term debt |
|
|
(13.7 |
) |
|
|
(1,054.0 |
) |
Proceeds from Accounts Receivable Securitization Facility |
|
|
438.2 |
|
|
|
— |
|
Repayments of Accounts Receivable Securitization Facility |
|
|
(363.2 |
) |
|
|
— |
|
Cash provided by (used in) financing activities |
|
|
40.7 |
|
|
|
(48.2 |
) |
Effect of exchange rates on cash |
|
|
(1.0 |
) |
|
|
(5.0 |
) |
Net change in cash, cash equivalents, and restricted cash |
|
|
(93.5 |
) |
|
|
66.9 |
|
Cash, cash equivalents, and restricted cash—beginning of period |
|
|
261.1 |
|
|
|
211.7 |
|
Cash, cash equivalents, and restricted cash—end of period |
|
$ |
167.6 |
|
|
$ |
278.6 |
|
Less: Restricted cash |
|
|
2.3 |
|
|
|
— |
|
Cash and cash equivalents—end of period |
|
$ |
165.3 |
|
|
$ |
278.6 |
|
TRINSEO PLC
Notes to Condensed Consolidated Financial Information
(Unaudited)
Note 1: Net Sales by Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||
|
|
September 30, |
|
September 30, |
||||||||
(In millions) |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||
Engineered Materials |
|
$ |
207.5 |
|
$ |
186.0 |
|
$ |
626.8 |
|
$ |
598.4 |
Latex Binders |
|
|
241.9 |
|
|
223.7 |
|
|
735.8 |
|
|
727.5 |
Plastics Solutions |
|
|
267.7 |
|
|
259.0 |
|
|
796.1 |
|
|
840.9 |
Polystyrene |
|
|
150.6 |
|
|
210.3 |
|
|
533.0 |
|
|
671.1 |
Americas Styrenics* |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
Total Net Sales |
|
$ |
867.7 |
|
$ |
879.0 |
|
$ |
2,691.7 |
|
$ |
2,837.9 |
* The results of this segment are comprised entirely of earnings from Americas Styrenics, our
Note 2: Reconciliation of Non-GAAP Performance Measures to Net Income
EBITDA is a non-GAAP financial performance measure, which is defined as income from continuing operations before interest expense, net; income tax provision; depreciation and amortization expense. We refer to EBITDA in making operating decisions because we believe it provides our management as well as our investors with meaningful information regarding the Company’s operational performance. We believe the use of EBITDA as a metric assists our board of directors, management and investors in comparing our operating performance on a consistent basis.
We also present Adjusted EBITDA as a non-GAAP financial performance measure, which we define as income from continuing operations before interest expense, net; income tax provision; depreciation and amortization expense; loss on extinguishment of long-term debt; asset impairment charges; gains or losses on the dispositions of businesses and assets; restructuring charges; acquisition related costs and benefits, and other items. In doing so, we are providing management, investors, and credit rating agencies with an indicator of our ongoing performance and business trends, removing the impact of transactions and events that we would not consider a part of our core operations.
Lastly, we present Adjusted Net Income (Loss) and Adjusted EPS as additional performance measures. Adjusted Net Income (Loss) is calculated as Adjusted EBITDA (defined beginning with net income from continuing operations, above), less interest expense, less the provision for income taxes and depreciation and amortization, tax affected for various discrete items, as appropriate. Adjusted EPS is calculated as Adjusted Net Income (Loss) per weighted average diluted shares outstanding for a given period. We believe that Adjusted Net Income (Loss) and Adjusted EPS provide transparent and useful information to management, investors, analysts and other stakeholders in evaluating and assessing our operating results from period-to-period after removing the impact of certain transactions and activities that affect comparability and that are not considered part of our core operations.
There are limitations to using the financial performance measures noted above. These performance measures are not intended to represent net income or other measures of financial performance. As such, they should not be used as alternatives to net income as indicators of operating performance. Other companies in our industry may define these performance measures differently than we do. As a result, it may be difficult to use these or similarly-named financial measures that other companies may use, to compare the performance of those companies to our performance. We compensate for these limitations by providing reconciliations of these performance measures to our net income, which is determined in accordance with GAAP.
|
|
|
|
|
|
|
|
|
||
|
|
Three Months Ended |
|
|
||||||
|
|
September 30, |
|
|
||||||
(In millions, except per share data) |
|
2024 |
|
2023 |
|
|
||||
Net loss |
|
$ |
(87.3 |
) |
|
$ |
(38.4 |
) |
|
|
Interest expense, net |
|
|
72.3 |
|
|
|
46.6 |
|
|
|
Provision for (benefit from) income taxes |
|
|
3.4 |
|
|
|
(17.7 |
) |
|
|
Depreciation and amortization |
|
|
48.3 |
|
|
|
38.2 |
|
|
|
EBITDA |
|
$ |
36.7 |
|
|
$ |
28.7 |
|
|
|
Net gain on disposition of businesses and assets |
|
|
— |
|
|
|
(9.3 |
) |
|
Selling, general, and administrative expenses; Other expense (income), net |
Restructuring and other charges (a) |
|
|
28.5 |
|
|
|
13.8 |
|
|
Selling, general, and administrative expenses |
Asset impairment charges or write-offs |
|
|
— |
|
|
|
0.5 |
|
|
Impairment and other charges |
Other items (b) |
|
|
0.9 |
|
|
|
7.2 |
|
|
Cost of goods sold; Selling, general, and administrative expenses; Loss on extinguishment of long-term debt |
Adjusted EBITDA |
|
$ |
66.1 |
|
|
$ |
40.9 |
|
|
|
Adjusted EBITDA to Adjusted Net Loss: |
|
|
|
|
|
|
|
|
||
Adjusted EBITDA |
|
|
66.1 |
|
|
|
40.9 |
|
|
|
Interest expense, net |
|
|
72.3 |
|
|
|
46.6 |
|
|
|
Provision for income taxes - Adjusted (c) |
|
|
3.5 |
|
|
|
(18.6 |
) |
|
|
Depreciation and amortization - Adjusted (d) |
|
|
47.8 |
|
|
|
49.2 |
|
|
|
Adjusted Net Loss |
|
$ |
(57.5 |
) |
|
$ |
(36.3 |
) |
|
|
Weighted average shares- diluted |
|
|
35.4 |
|
|
|
35.2 |
|
|
|
Adjusted EPS |
|
$ |
(1.62 |
) |
|
$ |
(1.03 |
) |
|
|
|
|
|
|
|
|
|
|
|
||
Adjusted EBITDA by Segment: |
|
|
|
|
|
|
|
|
||
Engineered Materials |
|
$ |
25.0 |
|
|
$ |
4.8 |
|
|
|
Latex Binders |
|
|
25.6 |
|
|
|
18.4 |
|
|
|
Plastics Solutions |
|
|
27.7 |
|
|
|
16.9 |
|
|
|
Polystyrene |
|
|
4.1 |
|
|
|
(0.7 |
) |
|
|
Americas Styrenics |
|
|
4.0 |
|
|
|
19.0 |
|
|
|
Corporate Unallocated |
|
|
(20.3 |
) |
|
|
(17.5 |
) |
|
|
Adjusted EBITDA |
|
$ |
66.1 |
|
|
$ |
40.9 |
|
|
|
(a) |
|
Restructuring and other charges for the 2024 and 2023 periods primarily relate to employee termination benefits, contract termination costs as well as decommissioning and other charges incurred in connection with the Company’s restructuring plans. |
(b) |
|
Other items for the 2024 and 2023 periods primarily relate to fees incurred in conjunction with certain of the Company’s strategic initiatives, as well as costs related to our transition to a new enterprise resource planning system. |
(c) |
|
Adjusted to remove the tax impact of the items noted within the table above. The income tax expense (benefit) related to these items was determined utilizing either (1) the estimated annual effective tax rate on our ordinary income based upon our forecasted ordinary income for the full year or, (2) for items treated discretely for tax purposes we utilized the applicable rates in the taxing jurisdictions in which these adjustments occurred. |
(d) |
|
Amounts for the three months ended September 30, 2024 and 2023 excludes accelerated depreciation of |
For the same reasons discussed above, we are providing the following reconciliation of forecasted net loss to forecasted Adjusted EBITDA, Adjusted Net Loss and Adjusted EPS for the three months ended December 31, 2024. See “Note on Forward-Looking Statements” above for a discussion of the limitations of these forecasts. Totals may not sum due to rounding.
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
December 31, |
(In millions, except per share data) |
|
|
2024 |
Adjusted EBITDA |
|
$ |
40 - 50 |
Interest expense, net |
|
|
68 |
Provision for income taxes |
|
|
5 |
Depreciation and amortization |
|
|
48 |
Reconciling items to Adjusted EBITDA (e) |
|
|
— |
Net Loss |
|
|
(81) – (71) |
Reconciling items to Adjusted Net Loss (e) |
|
|
— |
Adjusted Net Loss |
|
$ |
(81) – (71) |
|
|
|
|
Weighted average shares - diluted (f) |
|
|
35.3 |
EPS - diluted ($) |
|
$ |
(2.29) – (2.01) |
Adjusted EPS ($) |
|
$ |
(2.29) – (2.01) |
(e) |
|
Reconciling items to Adjusted EBITDA and Adjusted Net Income (Loss) are not typically forecasted by the Company based on their nature as being primarily driven by transactions that are not part of the core operations of the business and, as a result, cannot be estimated without unreasonable cost or uncertainty. As such, for the forecasted fourth quarter ended December 31, 2024, we have not included estimates for these items. |
(f) |
|
Weighted average shares presented for the purpose of forecasting EPS and Adjusted EPS assume that the Company will be in a net loss position for fourth quarter 2024, and therefore excludes the impact of potentially dilutive shares, as the inclusion of said shares would have an anti-dilutive effect. Further, the weighted average shares presented do not forecast significant future share transactions or events, such as repurchases, significant share-based compensation award grants, and changes in the Company’s share price. These are all factors which could have a significant impact on the calculation of EPS and Adjusted EPS during actual future periods. |
Note 3: Reconciliation of Non-GAAP Liquidity Measures to Cash from Operations
The Company uses certain measures, such as Free Cash Flow as non-GAAP measures, to evaluate and discuss its liquidity position and results. Free Cash Flow is defined as cash from operating activities, less capital expenditures. We believe that Free Cash Flow provides an indicator of the Company’s ongoing ability to generate cash through core operations, as it excludes the cash impacts of various financing transactions as well as cash flows from business combinations that are not considered organic in nature. We also believe that Free Cash Flow provides management and investors with useful analytical indicators of our ability to service our indebtedness, pay dividends (when declared), and meet our ongoing cash obligations.
Free Cash Flow is not intended to represent cash flows from operations as defined by GAAP, and therefore, should not be used as alternatives for that measure. Other companies in our industry may define Free Cash Flow differently than we do. As a result, it may be difficult to use this or similarly-named financial measures that other companies may use, to compare the liquidity and cash generation of those companies to our own. The Company compensates for these limitations by providing the following detail, which is determined in accordance with GAAP.
Free Cash Flow
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
|
September 30, |
|
September 30, |
||||||||||||
(In millions) |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
Cash provided by (used in) operating activities |
|
$ |
8.8 |
|
|
$ |
29.3 |
|
|
$ |
(99.3 |
) |
|
$ |
131.2 |
|
Capital expenditures |
|
|
(12.2 |
) |
|
|
(13.5 |
) |
|
|
(42.1 |
) |
|
|
(49.1 |
) |
Free Cash Flow |
|
$ |
(3.4 |
) |
|
$ |
15.8 |
|
|
$ |
(141.4 |
) |
|
$ |
82.1 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20241106313619/en/
Trinseo Contact:
Bee Van Kessel, Senior Vice President, Corporate Finance and Investor Relations
Tel: +41 447183685
Email: bvankessel@trinseo.com
Source: Trinseo
FAQ
What was Trinseo's (TSE) net loss in Q3 2024?
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