In This Article:
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Adjusted EBITDA: $66 million, $25 million higher than prior year.
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Free Cash Flow: Negative $3 million, with expectations to turn positive in Q4.
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Cash and Liquidity: $165 million in cash and $342 million in total liquidity.
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Volume Decrease: 8% year-over-year decrease, excluding polystyrene volumes which were flat.
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Sales of Recycled Content Products: Increased 40% in Q3 versus prior year.
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Cost Savings Initiatives: Expected savings of $25 million in 2025 and $30 million by end of 2026.
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Q4 Adjusted EBITDA Guidance: Expected to be $40 to $50 million.
Release Date: November 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Trinseo PLC (NYSE:TSE) reported a significant year-over-year profitability improvement due to earlier restructuring actions.
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The company experienced a 36% increase in compounds for consumer electronics applications and a 7% increase in battery applications, indicating growth in higher-margin areas.
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Sales of recycled content products increased by 40% in Q3 compared to the previous year, highlighting a successful focus on sustainable offerings.
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Trinseo PLC (NYSE:TSE) announced restructuring initiatives expected to result in cost savings of approximately $25 million in 2025 and $30 million by the end of 2026.
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The company expects free cash flow to turn positive in Q4, supported by typical seasonal working capital improvements.
Negative Points
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Trinseo PLC (NYSE:TSE) faced unplanned outages at two of its production facilities, negatively impacting adjusted EBITDA.
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Volumes decreased by 8% year-over-year, driven by efforts to shed uneconomic sales in Asia and Europe.
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The company anticipates seasonally slower market demand in Q4, leading to sequentially lower adjusted EBITDA.
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There is continued macroeconomic uncertainty, which could impact demand and profitability.
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Trinseo PLC (NYSE:TSE) expects negative timing impacts in Q4 due to declining raw material prices.
Q & A Highlights
Q: Can you provide an update on the AMCI sales process and confirm if the unplanned outages are resolved? A: Yes, the unplanned outages are behind us, and both units have restarted. We expect full contribution from Amsty in Q4. Regarding the AMCI sales process, we have a joint agreement with CPCHEM to market the asset, and we anticipate signing a transaction in the first half of next year. - Frank Bozich, CEO
Q: Is there any update on the timing and process regarding the extension of the May 2026 revolver? A: We are considering using cash on hand or a refinancing transaction to handle the $115 million due in September next year. We will announce more details when available. - David Stasse, CFO