Tronox Limited Announces Preliminary Unaudited 2012 Financial Results

    Tronox Limited Announces Preliminary Unaudited 2012 Financial Results

WITH STRONG CASH BALANCE, COMPANY CONSIDERING REFINANCING DEBT

PR Newswire

STAMFORD, Conn., Feb. 7, 2013

STAMFORD, Conn., Feb. 7,2013 /PRNewswire/ --Tronox Limited (NYSE: TROX)
announced today that it expects to report fourth-quarter 2012 revenue of $482
million and adjusted earnings before interest, taxes, depreciation and
amortization (EBITDA) of approximately $70 million, which is below previous
guidance, due to the combined effect of three scheduled ore shipments in the
quarter that were either delayed or cancelled by customers and a $9.6 million
lower of cost or market (LCM) inventory write-down. One of the delayed
shipments constituting 10,000 metric tons of chloride slag was shipped on
January 7, 2013. In addition, while zircon sales volumes were approximately
as forecast, zircon prices in the fourth quarter were roughly 12 percent below
forecast.

(Logo: http://photos.prnewswire.com/prnh/20051118/TRONOXLOGO-a)

For the first time since 2005, fourth-quarter pigment sales volumes were
higher than those of the preceding third quarter. The sequential difference
was only 1,429 metric tons, but the company views this increase in what is
normally a seasonally affected lower quarter as a positive sign.
Nevertheless, because prices declined 10.7 percent sequentially, which was
more than the company had forecast, adjusted EBITDA from pigment sales was
approximately $10 million less than forecasted.

The aggregate EBITDA effect of the missed mineral sands shipments, the zircon
pricing, the LCM charge, and the pigment shortfall was partially offset by
operating cost savings achieved across all business units.

Tronox had a cash balance of $716 million at year-end 2012.

The company also announced that it is evaluating opportunities to refinance
its term loan under more favorable terms and conditions, given the current
debt market environment.

In accordance with normal procedures, these unaudited preliminary revenue and
other results are subject to further review and completion of year-end
accounting processes by the company and its auditors, which include the
finalization of potentially significant items that could affect these results.
As a result, preliminary net income estimates are not available at this time.

The company expects to release fully audited fourth quarter and full year 2012
financial results on February 20, 2013. Accordingly, the company will remain
in a quiet period with investors and analysts until complete financial results
are released.

About Tronox

Tronox is a global leader in the production and marketing of titanium bearing
mineral sands and titanium dioxide pigment. Through the integration of its
mineral sands and pigment business, the company provides its customers a
dependable supply of brightening solutions for a variety of end uses. For more
information, visit http://www.tronox.com.

Forward Looking Statements

Statements in this release that are not historical are forward-looking
statements within the meaning of the U.S. Private Securities Litigation Reform
Act of 1995. These forward-looking statements are based upon management's
current beliefs and expectations and are subject to uncertainty and changes in
circumstances and contain words such as "believe," "intended," "expect," and
"anticipate" and include statements about expectation for future results
including revenues. The forward-looking statements involve risks that may
affect the company's operations, markets, products, services, prices and other
risk factors discussed in the company's filings with the Securities and
Exchange Commission (SEC), including those under the heading entitled "Risk
Factors" in our registration statement on Form S-4 declared effective by the
SEC on May 4, 2012. Significant risks and uncertainties may relate to, but are
not limited to, our ability to integrate the recently acquired mineral sands
business including achieving the expected cost savings; financial, economic,
competitive, environmental, political, legal regulatory and technological
factors including, our access to unrestricted cash, compliance with our bank
facility covenants, the price of our shares, general market conditions, our
customers potentially reducing their demand for our products due to, among
other things, the economic downturn, more competitive pricing from our
competitors, increased supply from our competitors; operating efficiencies and
other benefits expected. Unless otherwise required by applicable laws, the
company undertakes no obligation to update or revise any forward-looking
statements, whether as a result of new information or future developments.

Use of Non-GAAP Financial Information

To provide investors and others with additional information regarding Tronox
Limited's operating results, we have disclosed in this press release certain
non-GAAP financial measures, including Adjusted EBITDA. These non-GAAP
financial measures are a supplement to, and not a substitute for or superior
to, the company's results presented in accordance with US GAAP. The non-GAAP
financial measures presented by the company may be different than non-GAAP
financial measures presented by other companies. The non-GAAP financial
measures are provided to enhance the user's overall understanding of the
company's operating performance. Specifically, the company believes the
non-GAAP information provides useful measures to investors regarding the
company's financial performance by excluding certain costs and expenses that
the company believes are not indicative of its core operating results, as well
as the impact of fresh-start accounting applied in 2011 and purchase
accounting being applied in 2012. The presentation of these non-GAAP financial
measures are not meant to be considered in isolation or as a substitute for
results or guidance prepared and presented in accordance with US GAAP. A
reconciliation of the non-GAAP financial measures to GAAP results are included
herein.

Management believes these non-GAAP financial measures:

  oReflect Tronox Limited's ongoing business in a manner that allows for
    meaningful period-to-period comparison and analysis of trends in its
    business, as they exclude income and expense that are not reflective of
    ongoing operating results;
  oProvide useful information to investors and others in understanding and
    evaluating Tronox Limited's operating results and future prospects in the
    same manner as management and in comparing financial results across
    accounting periods;
  oProvide additional view of the operating performance of the company by
    adding interest expenses, taxes, depreciation and amortization to the net
    income. Further adjustments due to fresh-start accounting, purchase
    accounting, and stock-based compensation charges attempt to exclude items
    that are either non-cash or non-recurring in nature;
  oEnable investors to assess the company's compliance with financial
    covenants under its debt instruments. Certain debt instruments have
    financial covenants that use Adjusted EBITDA as part of their compliance
    measures, e.g., consolidated leverage ratio, which is a ratio of
    indebtedness to consolidated Adjusted EBITDA; and consolidated interest
    coverage ratio which is a ratio of consolidated Adjusted EBITDA to
    interest expenses; and
  oIn addition, Adjusted EBITDA is one of the primary measures management
    uses for planning and budgeting processes and to monitor and evaluate
    financial and operating results. Adjusted EBITDA is not a recognized term
    under GAAP and does not purport to be an alternative to measures of our
    financial performance as determined in accordance with GAAP, such as net
    income (loss). Because other companies may calculate EBITDA and Adjusted
    EBITDA differently than Tronox, EBITDA may not be, and Adjusted EBITDA as
    presented in this release is not, comparable to similarly titled measures
    reported by other companies

Media Contact: Bud Grebey
Direct: 203.705.3721
Bud.grebey@tronox.com

Investor Contact: Brennen Arndt
Direct: 203.705.3722

SOURCE Tronox Limited

Website: http://www.tronox.com
 
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