Chemours forecasts better-than-expected earnings for 2023 on stronger demand
Feb 9 (Reuters) - Chemours Co (CC.N) on Thursday forecast higher-than-expected earnings for full-year 2023 on expectations of a stronger demand for components used in semiconductor manufacturing as well as other specialty chemicals, but shares fell 4.1% aftermarket on missing fourth-quarter estimates.
Strict lockdowns in China, the world's second largest economy, forced factories to shut down, resulting in lower demand for specialty chemicals. However, the country has since dismantled its Covid curbs and reopened its economy.
"Our outlook contemplates a weaker start to 2023 with conditions improving in the second half of the year," said Mark Newman, chief executive officer at Chemours.
Peers Dow Inc (DOW.N) and DuPont de Nemours (DD.N) had already given a dour outlook for at least the first quarter of 2023.
Chemours projected its 2023 earnings before interest, taxes, depreciation and amortization in the range of $1.20 billion to $1.30 billion, the midpoint of which is higher than analysts' estimate of $1.22 billion.
Economic activity in Europe and the Asia slowed in 2022, lowering demand for the company's products, while Western sanctions on top energy producer Russia increased cost of production for Chemours and its peers.
The specialty chemicals company's revenue from its largest segment Titanium Technologies - which produces the titanium dioxide pigment used in coatings, plastics and laminates - fell about 30% to $606 million for the three months ended Dec. 31.
But sales at its TSS segment, which produces refrigerants, propellants and other specialty chemicals, rose 8% in the fourth quarter and sales at its APM segment, which makes components used in semi-conductor manufacturing, increased by 10%.
On an adjusted per-share basis, the company posted breakeven results, while analysts were expecting a profit of 8 cents, according to Refinitiv data.
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