08 May 2013 23:30 [Source: ICIS news]
HOUSTON (ICIS)--US-based Kronos posted a net loss of $41.1m for the first quarter of 2013 due to lower titanium dioxide (TiO2) prices and higher raw materials costs, the TiO2 producer announced on Wednesday.
Kronos had a net profit of $136.9m during the same period in 2012.
Kronos' net sales decreased more than 17% to $463.6m in Q1 2013 from $561.3m in Q1 2012, while cost of sales increased more than 55% to $459.7m in Q1 2013 from $299.8m in 2012.
TiO2 product pricing for the first quarter decreased by 21% year on year, while sales volume increased by 1% and product mix increased by 3%, the company said.
Raw material costs have been higher, and Kronos’ moderation in the cost of third-party feedstock ore have been inadequate to compensate for the decline in selling prices for its products, the company said.
“Industry data indicates that overall TiO2 inventory held by producers has been significantly decreased,” Kronos’ CEO Steven Watson said.
“In addition, we believe most customers hold very low inventories of TiO2, with many operating on a just-in-time basis,” Watson added. “Shortages of certain TiO2 grades have recently occurred, and lead times for delivery are increasing.”
Looking forward, Kronos said it will align production levels and inventories according to near-term customer demand levels, noting that TiO2 prices have generally stabilised and price increases have been realised in some accounts.
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