Kronos Q4 turns profitable

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Kronos Q4 turns profitable

13
Mar '14

Kronos Worldwide, Inc. reported net income for the fourth quarter of 2013 of $2.9 million, or $.03 per share, compared to a net loss of $18.1 million, or $.16 per share, in the fourth quarter of 2012.

For the full year of 2013, Kronos Worldwide reported a net loss of $102.0 million, or $.88 per share, compared with net income of $218.5 million, or $1.89 per share in 2012. Comparability of the Company's results for the fourth quarter periods was impacted by lower income from operations in 2013 principally due to lower average TiO2 selling prices, partially offset by lower raw materials costs.

Comparability of the full year periods was impacted by lower income from operations in 2013, principally due to lower average TiO2 selling prices, higher raw materials and other production costs and a litigation settlement charge in 2013, as discussed further below. Comparability of the Company's results for the fourth quarter and full year of 2013 was also impacted by unabsorbed fixed production and other costs associated with the labor lockout at our Canadian plant, and costs resulting from the terms of a new collective bargaining agreement reached with our unionized Canadian workforce and other back-to-work expenses, as discussed further below.

Net sales of $368.6 million in the fourth quarter of 2013 were $28.2 million, or 7%, lower than in the fourth quarter of 2012. Net sales of $1,732.4 million in the full year of 2013 were $243.9 million, or 12%, lower than in the full year 2012. Net sales decreased in the fourth quarter of 2013 as compared to the fourth quarter of 2012 primarily due to lower average TiO2 selling prices. Net sales decreased in the full year of 2013 primarily due to lower average TiO2 selling prices, partially offset by higher sales volumes.

The Company's average TiO2 selling prices decreased 10% in the fourth quarter of 2013 as compared to the fourth quarter of 2012, and decreased 19% for the full year as compared to 2012. The Company's average TiO2 selling prices at the end of 2013 were 7% lower than at the end of 2012 and were 1% higher in the fourth quarter of 2013 as compared to the third quarter of 2013.

TiO2 sales volumes in the fourth quarter of 2013 were 1% lower than in the fourth quarter of 2012, while sales volumes for the full year 2013 were 6% higher than in 2012. TiO2 sales volumes in the fourth quarter of 2013 were impacted by the continued lockout of unionized employees at the Company's Canadian TiO2 facility, and the resulting curtailment of production at such facility during the lockout.

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