US Kronos Q4 income surges to $21.8m on rising TiO2 prices

HOUSTON (ICIS)–US titanium dioxide (TiO2) producer Kronos reported on Monday a 2010 fourth-quarter net income of $21.8m (€15.7m), substantially above the $600,000 profit in the fourth quarter of 2009.

Fourth-quarter net sales were $262.7m, up 16% year on year as average TiO2 selling prices climbed 25%.

Meanwhile, TiO2 fourth-quarter sales volumes slipped 1% to 77,000 tonnes. Kronos did not specify why volumes fell.

TiO2 fourth-quarter production volumes were 7% higher from the year-earlier period.

On a sequential basis, average TiO2 selling prices were 7% higher in the fourth quarter than the third quarter.

For the full year 2010, Kronos reported net income of $86.5m, up from a net loss of $46.5m in 2009 as sales increased 22% to $998.5m.

“We saw significant improvement in our business and the TiO2 industry during 2010,” said Kronos chief executive Steven Watson.

“Worldwide demand for our TiO2 products continued to strengthen and our manufacturing facilities successfully operated at near full practical capacity utilisation levels,” he continued.

However, profit margins were still significantly lower than needed to justify TiO2 capacity expansions, he noted.

“Assuming demand for TiO2 products remains strong, we expect the worldwide shortage will continue beyond 2011, and we expect to implement additional increases in our TiO2 selling prices,” Watson said.

“As a result, we believe we will report additional improvements in our operating and financial performance in 2011.”

($1 = €0.72)

For more on TiO2 visit ICIS chemical intelligence