Ladies and gentlemen, thank you for standing by and welcome to The Chemours Company First Quarter Earnings Call. At this time, all participants’ lines are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] I would now like to hand the conference over to our speaker today, Jonathan Lock, Vice President of Corporate Development and Investor Relations. Thank you. Please go ahead, sir.

Good morning and welcome to The Chemours Company’s first quarter 2020 earnings conference call. I am joined virtually today by Mark Vergnano, President and Chief Executive Officer; Mark Newman, Senior Vice President and Chief Operating Officer; and Sameer Ralhan, Senior Vice President and Chief Financial Officer. Before we start, I would like to remind you that comments made on this call as well as the supplemental information provided in our presentation and on our website contain forward-looking statements that involve risks and uncertainties, including the impact of COVID-19 on our business and operations and the other risks and uncertainties described in the documents Chemours has filed with the SEC. These forward-looking statements are not guarantees of future performance and are based on certain assumptions and expectations of future events that may not be realized. Actual results may differ and Chemours undertakes no duty to update any forward-looking statements as a result of future developments or new information. During the course of this call, management will refer to certain non-GAAP financial measures that we believe are useful to investors evaluating the company’s performance. A reconciliation of non-GAAP terms and adjustments are included in our release and at the end of this presentation. I will now turn the call over to our CEO, Mark Vergnano, who will review the highlights from the first quarter. Mark?

Thank you, Jonathan and thank you everyone for joining us today. I would like to start this call with a personal thanks and acknowledgement to those operating in the frontlines of the COVID-19 pandemic. Our first responders and medical personnel have gone bravely to help those in need and to control the spread of this terrible disease. Those in food service, grocery, sanitation, fuel delivery and energy put themselves at risk to help ensure that we have the things we need to run our business and support our families. We are all collectively the beneficiaries of your sacrifice. So, on behalf of the nearly 7,000 global employees of Chemours and their families, thank you. COVID-19 has been a game changer. As a global business, we have been adapting to the dynamics created by this pandemic since the beginning of the year starting first in Asia, protecting the health and well-being of our employees, while supporting our customers continues to be our top priority. Our internal response to COVID-19 has been swift. During the first quarter, we implemented strong social distancing and control measures across all our laboratory and manufacturing facilities. This includes limiting access to our sites and restricting movement between areas on our sites. We have also implemented temperature health checks, increased mask use and provided additional training, including the use of social distancing. Early in the first quarter, we scaled our remote IT infrastructure ahead of government shelter in place rules. This gave our office-based teams and outsourced providers the ability to work from home very early with minimal disruption and cost. This disciplined execution of our business continuity plan has enabled us to continue to serve our customers safely and reliably. Today, all our plants are up and running, evidence that our early interventions are working. We…

Thanks Mark. I will begin my comments on Slide 5. First quarter revenues of $1.3 billion were down slightly from last year, primarily due to volume and price headwinds in Fluoroproducts and reduced sales in Chemical Solutions. These headwinds in Fluoroproducts and Chemical Solutions were largely offset by stronger year-over-year sales in Titanium Technologies, which were up 10% from the same period in 2019. GAAP net income was $100 million, up 6% from the first quarter of 2019. While adjusted net income was $118 million, up 8% from the first quarter of 2019. This drove an 11% increase in GAAP earnings per share, with $0.61 per share and 13% increase in adjusted earnings per share to $0.71 per share. Free cash flow used was $62 million, an improvement of $115 million from 2019 levels. As a reminder, our heaviest use of working capital is typically in the first quarter. During the quarter, we amended our accounts receivable securitization facility, which resulted in a reduction of our debt level by $110 million with a similar benefit to cash flow from operations. Finally, as a reminder, our Board of Directors approved a Q2 dividend of $0.25 per share. This is unchanged from the prior quarter and will be payable to shareholders of record as of May 15. Moving to the next chart, first quarter 2020 adjusted EBITDA of $257 million represented a sequential improvement of 13% and was almost flat relative to the prior year’s first quarter. Looking at the bridge, results were driven by lower average prices across all three segments and 19% higher volumes in Titanium Technologies partially offset by lower volumes in Fluroproducts and Chemical Solutions, higher volumes over a $14 million tailwind in the quarter. Finally, we delivered a $61 million improvement in costs and other. This improvement…

Thanks, Sameer and good morning, everyone. Before I cover the businesses, I would like to take a moment to thank every Chemours leader and team member for rising to the challenges we faced since the COVID-19 pandemic started. I am proud of the serving our customers and for the contributions our people have made locally with gloves, protective suits and laptops to first responders in the communities where we operate. It is a true demonstration of the spirit of Chemours and proof that we are indeed all in this together. As it relates to our businesses, let’s start with Fluoroproducts on Chart 9. Among our segments, Fluoroproducts was the most impacted by COVID-19 in the quarter. First quarter Fluoroproducts sales reflect lower volume across a number of fluorochemicals and fluoropolymer product lines. Auto and other end-market demand weakened significantly late in the quarter, reducing demand for both refrigerants and fluoropolymers, which they are used in the fabrication of many components. On the stationary refrigerants front, we continue to work with regulators in Europe on measures to control the amount of illegal imports into Europe, but at least through the first quarter, have yet to see significant progress. Pricing in the segment was a 4% headwind driven by HFC illegal imports into the EU and a slight decline in global refrigerant prices. Adjusted EBITDA for the first quarter came in at $140 million, down $19 million from the same period in 2019. This result also reflects the impact of lower F-Gas quota sales in the quarter. However, these headwinds were partially offset by improved operating performance across all our manufacturing facilities and the ramp up of our Corpus Christi facility. Given the current status of COVID-19, we anticipate continued weakness during the next quarter in auto as plant shutdowns and lower…

Turning the last chart, I would like to emphasize that Chemours is taking action in response to COVID-19. As I said at the start of the call, we have a very simple formula of putting the health of our employees and supporting our customers first. We have moved quickly to help prevent the spread of COVID-19 throughout the company by enacting strong safety protocols across all our offices, laboratories and manufacturing facilities. Our employees’ health has by and large not been impacted by COVID-19 and we will continue to be proactive to ensure the health safety and well-being of our people. The health and safety of our workforce enables us to provide supply continuity to our customers and to support our local communities. All our plants and operations are up and running and the flexibility of our supply chain enables us to manage through any near-term disruption. Chemours is operating well and we will stand by our customers throughout this crisis. We believe this is an incredible source of competitive advantage in these uncertain times. Secondly, we believe in the strength of our balance sheet. While we certainly did not anticipate an event of this magnitude this year, we believe that we have taken prudent measures to preserve financial flexibility. With $1.4 billion of liquidity, including $1 billion of cash on hand, we are well-capitalized heading into the remainder of 2020. We have no near-term maturities and have sufficient covenant headroom. Finally, we are acting prudently to reinforce the financial strength of Chemours, including immediate actions that will reduce cost by $160 million and CapEx by $125 million in 2020. COVID-19 will present a rapidly changing economic environment dictated by health challenges, which cannot be measured in pure monetary terms. Our hearts go out to those affected by this virus. Chemours and our nearly 7,000 employees stand ready to serve our customers, render aid in our communities around the world, and assist in the fight against COVID-19. With that, please open up the line for questions.

[Operator Instructions] Your first response is from John McNulty from BMO Capital Markets. Please go ahead.

Hey, good morning guys. This is Colton being on for John. So on the 2%...

Good morning.

Good morning. On the 2% sequential decline in TiO2 pricing, can you talk a little bit on how much of that was product or selling platform mix versus how much of it was actual apples-to-apples price cuts?

Yes, that was almost entirely mix for us in terms of when you look at our most likely channel mix as well a little bit of regional mix. But it was fundamentally all mix.

Okay, great, great. That’s helpful. And second, I’d love to hear a little bit just on what you are seeing on the feedstock side and kind of what your core outlook is going forward?

Yes. So right now, we are not seeing a whole lot of change in feedstocks as you all know high grade ore got a little bit tight in the fourth quarter of last year continuing into this year. Obviously it’s going to be dependent on demand going forward, but we are not seeing a significant change from an ore cost perspective at this point. And again, as we said to everyone before, we are really set in our ore inventory in terms of what we need to buy and what we need to sell. So from that standpoint, we feel very confident that we are not going to see any kind of a perturbation from an ore cost standpoint to us. But I would guess, if I had to put a guess in and maybe Mark Newman wants to add to this, he can, but I would say we don’t anticipate much fluctuation in the ore pricing market.

Agree, Mark. We are well situated with our ore buy for this year. We had good inventory levels coming into the year. So I think we are not seeing a lot of ore inflation here in this environment.

Alright, alright. Thanks guys.

Thank you.

Thank you. Your next response is from Bob Koort of Goldman Sachs. Please go ahead.

Thank you. Mark, I wanted to ask on the litigation front, you guys had a couple of cases tried in the first quarter. And I guess the good news you had one that wasn't a war in the bat is another that was but maybe a level lot higher than we saw a few years back so can you sort of talk us through the decision tree in the past over there and I guess that the next round has been deferred until August but. What kind of progress might we expect on some resolution there?

Yes Bob I guess first of all as you said we had two cases that were tried one which was basically a hung journey and the other one, which was an amount given to us in DuPont number one is we're going through the process of appeal on that we think we have very strong appeal points first we have to go to the judge and then we go to the to the circuit for the appeals side of that and again we have tremendous appeal points there and as you said the next set of trials won't be up until August 1 they were originally scheduled for June and those got moved to August so we'll continue to work through that process as we always have I know some folks have talked about potential settlement these things always happen potential settlements so we'll continue to go down that path but right now we are very focused on the appeal points and getting ready for the next set of trials.

Alright. On the AVA contracts, I am just curious how those held in light of where you initially established those with your biggest customers a couple years back now and. Should we still expect pricing for that kind of volume to be index to PPI or some other sort of macro inflation?

Yes, that's the way they're set up Bob these contracts have really worked as we always said they work best it seemed for our coding customers and they've worked extremely well especially when you get into a situation like we're in now with COVID-19 because people know what the price point is they don't have to buy beyond what their needs are because we hold that inventory and they also buying based on their share so if the demand goes down like we're seeing right now with the world demand going down on everything because no one 's buying anything from a consumer standpoint they don't have to meet some kind of a level of an arbitrary level of volume they need a share value that was based on what they are selling so we think that actually the AVA contracts work extremely well for our customers right now and I I know they felt the same way so far. But due to your specific question yes they will they will adjust half of the PPI values that we had set before twice a year.

Great. I appreciate it.

Thank you. Your next response is from Josh Spector from UBS. Please go ahead.

Yes. Hey, guys. Thanks for taking my question. Just wondering within Fluoroproducts within the portfolio, can you provide any color on perhaps the volume difference between chemicals and polymers in terms of what you saw last quarter and maybe if there are any differences between early in the quarter and late in the quarter?

Yes, let me get started Josh and then Mark can give you a little bit more color I say that when you look at when you look at the Fluoroproducts as you said you think of the Opteon side the fluorochemicals side primarily refrigerants and right now Opteon being the driver there is going in automotive. Automotive really slowed down towards the end of the first quarter as you saw production facilities auto production facilities in Europe and in the U.S. really slow down or stopped in some cases they have really shut down auto manufacturing in Japan and the US and in Europe so by the end of the quarter you saw a drop significantly on our Opteon volume actually the opposite on our fluoropolymers side fluoropolymers which are the two primary places that fluoropolymers go is going to be into either automotive or into electronics automotives was semi week to start within and slowed down toward the end of the quarter electronics was weak early primarily because a lot of our customers are in Asia and Asia was in the midst of the COVID-19 epidemic so from that standpoint that was really slow but that started to pick up toward the end of the quarter so you sort of start to two crossing curves if you will. Across those Mark I don’t know if you want to add any more color to that.

Yes. So Mark, just to build on what you said, I'd say the overall volume impact was somewhat similar between the two but the shape in the quarter was quite different. We started to see the impact of COVID-19 in Asia which I think had a more pronounced impact on polymers but towards the end of the quarter we saw, we started to see stronger order books pick up as Asia started to come back on, especially in semicon. As you pointed on the refrigerant business especially Opteon YF, we really started to see the shutdown of assembly plants in Europe and then North America in the second half of March and that that'll carry into second quarter. So I would say going forward the impact on refrigerants is going to be higher in second quarter but in Q1 they were quite the same but with very different shapes in the quarter.

Thanks. That's helpful. And then maybe to stick on volume but on the TiO2 side and I know there's a lot of uncertainty on some of your competitors have talked about 2Q volumes down maybe 15%, 20%, yours are kind of tougher to estimate given the share gain being a factor. Can you provide any kind of range or thoughts about how you're thinking about volumes in the next quarter?

Yes. So as we think of, I think volume on a sequential basis where we came out in Q1. Obviously, we see very strong or resilient activity in DIY why in plastics but the construction market is been impacted here as we go into Q2. So my expectation is vis-à-vis Q1 we have down slightly on a sequential basis.

Yes Josh. I think just to add to Mark's point I think it's important to note that. The architectural coding producers who had really good access to DIY I think really performed well and so you saw that in the first quarter hopefully we will continue to see that in the second quarter and on the plastic side that seems to be an area as Mark said of strength but if you if you look at I think TZMI just came out with some new data that says they think that the total volume is going to be down 10% to 15% for the year more anticipating a little bit as Mark said a little bit weaker second quarter going forward.

Okay, thanks.

Thank you. Your next response is from Duffy Fischer of Barclays. Please go ahead.

Yes, good morning. Question on the fluoro segment could you help walk us through just what you've seen in volumes on the polymer and the gases side there. As a lot of people going into autos and some people are talking volumes down 40% or 50% in April and May. So what did you kind of seen quarter-to-date there and when do you see an inflection as you are talking with your customers do you think things start to get better in June?

Yes. Duffy, if you think about these in separate pieces because you got to think about refrigerants very separately, because Opteon with the issues that we're still working through in Europe with stationary Opteon going into stationary applications with the illegal imports. The bulk of Opteon sales is an automotive and so until you see these automotive production facilities restart in Japan and in U.S. and in Europe it's going to be weak. I think that the numbers that are out there somewhere between 40% and 50% reduction in automotive volumes that people are seeing and I would say that's right in line with what we're seeing from the standpoint of the refrigerant side going into going into automotive. Refrigerants normally you would see a second quarter pick up because that's when you see restocking outside of automotive just restocking getting ready for summer in the northern hemisphere that seems to be slower right now than what we normally would see from that standpoint and then when you shift over to the polymer side again still seeing weakness on the automotive side for all the reasons we just said on Opteon but we are seeing some pick up on the semicon portion especially in Asia where that’s been very big positive as Asians sort of come out of this pandemic and restarted a lot of the semiconductor facilities where we are a big supplier as you guys probably know from the equipment side of that. So I can’t give you a date when I think this is going to turn around. I think the thing to watch is going to be when auto manufacturers restart. I think that’s going to be the big delta, that’s going to change things going forward.

Okay. And then once we kind of put our guesstimate on where volumes end up, how should we think about decremental margins on the two fluoro halves, whether volumes are down 10 or 15 or 20, what’s the decremental pattern and does – or do decrementals get worse as volume drops further?

Yes. So, Duffy, it’s Mark Newman. The way I think about it is we are going to approach – we are going to run the business as we go through Q2 with a strong focus on cash generation. So, obviously, you know that our refrigerant business is a high margin business. So, I think if you have a pretty good sense of the variable margins on refrigerants. I think the way you should think about the impact on an earnings perspective is if you are running the business for cash, we are going to be very thoughtful as to how much product we build into inventory in the second quarter. And so I just encourage you to think about the fact that the earnings impact could be a little bit higher than the sort of pure decremental margin analysis, but we are going to be thinking of business for cash. And then being ready as Mark said, on the recovery, as we go through the quarter to pickup where we left off in Q1 with very strong operating performance, I don’t know if you noticed in the quarter, really significant improvement in both operating and cost performance in our fluoro business, which will be there for us as we come out of the recovery. So the way we are thinking about it is Q2 fairly large dislocation in volume from automotive. We are going to deal with it. We are going to be thoughtful about preserving and running the business for cash and then we are going to be ready with really strong ops to ramp up as our automotive customers, ramp up globally.

Yes, Duffy, to Mark’s point, we have said last year that we had some significant operating problems in the fluoro side and I give Mark Newman as well as Ed Sparks a lot of credit. They worked hard with their teams to really fix those. So we were operating extremely well coming out of fourth quarter. We operated extremely well in the first quarter. We have always said you should think of the fluoro business in the mid-20s from a margin perspective and we were in that range for the first quarter. But as Mark said, we are not going to build excess inventory and until production facilities of automotives ramps up, we don’t have – there is no need for us to build excess inventory. We will have the right inventory for our customers. So we are ready for them when they need it, but we don’t need extra inventory. So we are taking idle mill costs, for instance, in the second quarter. We do that because we want to be in a better position for the rest of the year versus just having high-priced inventory that’s going to flow through the system all year long.

Great. Thanks guys.

Yes.

Thank you. Your next response is from Don Carson of Susquehanna. Please go ahead.

Thank you. It’s Sandy Klugman on for Don. First question, what were your TiO2 offering rates in Q1 and what are the company’s expectations for Q2?

Yes. I’d just say we saw as we said in the materials, we saw better operating results – operating rates in the quarter coming out of Q3, you will see our EBITDA margin improved sequentially from 19% to 23%. So I think we are seeing better operating rates across our fleet. Obviously, we still have the ability to produce more as you know as demand increases and consistent with our market share being more in line with our capacity share over time.

Okay, great. Thank you. And then…

Go ahead, Sandy, I am sorry.

No, no, no, continue.

No, I was just going to say to Mark’s point, we try to balance our production facilities in terms of the demand. So, it’s really going to be dependent on what we see as demand going forward from that standpoint. As you guys know, we have some flexibility in ore grade of how we operate those, but we will do it smart and will try to maintain the right operating rates depending on what the demand picture is in the flexibility that we have in those assets.

Okay, thank you. I appreciate the insight. And then moving to the balance sheet, are there any key covenants that investors should be aware of in this – for instance, the company currently have?

Yes, this is Sameer. I will take this one. Essentially when you look at our – the credit facility as we outlined in our presentation, yes, we do have our maintenance covenant, but we have significant room that’s available on the covenant, so we feel pretty good about where we are from a covenant flexibility point of view.

Okay, thank you. And just final question, have you seen a reduction of Chinese refrigerant exports into the EU just given the region’s shipping constraints in Q1?

Yes. It’s been hard for us to gauge that perfectly. I would say that most likely that has been the case. But as you know, everything in China was way down in the beginning of the year production as well as exports. I think that as China has started to ramp up their consumption inside the country has been slower. So I am sure that there is some level of exports that are continuing as well. But I think it’s really too early right now to see that. We haven’t seen the statistics that normally would come out, because all that’s been delayed with the pandemic as well. So, my anticipation is probably lower, but we will see.

Thank you very much.

Thank you. Your next response is from Laurence Alexander from Jefferies. Please go ahead.

Hi, this is Adam Bubes on for Laurence today. I was wondering in regards to illegal imports of HFC refrigerants, are you seeing like any impacts from the coronavirus there or anything that would change your outlook?

So, as Mark said on the prior question early in the quarter, we did see some issues with the supply chain coming out of China across refrigerants, but sitting here today, certainly it feels like China is coming back online. What I would say to you is overall, we have not seen any further deterioration in the refrigerant business in Europe versus what we saw last year. Obviously, there are some practical limitations in terms of the field work of curtailing illegal imports with a lockdown in COVID-19. But overall what I would say is we have not seen any further deterioration in our refrigerant business in Europe. I would also point to the quota, when you look at our fluoro results, we are down $19 million year-over-year, but that’s with a delta of $21 million in quota sales last year versus this year. So I would say quota sales in terms of the year-over-year comparison continues to be a headwind, but when you look at our fluoro results in spite of that quota sale headwind, our results are reflecting, I would say, pretty significant cost and operational improvement and the impact as we said earlier of some COVID-19 impact on both our polymer and our refrigerant business. So overall we are quite happy with the results in the quota based on cost and operating performance really offsetting the quota impact and the COVID-19 impact on our results.

Okay, thank you. That’s very helpful. And then my second question, I was just wondering if you could provide a little bit more color on the $0.19 volume increase in TiO2, I was wondering how much of this is gaining market share versus demand and where are volumes sequentially?

Yes. So maybe I will start and Mark can give you the detail a little bit better on that, Adam. But I would say that when you look at it, we believe we will see we think we gained some share again primarily in the plastics and laminate area, where we had lost the most of our share from that standpoint and those are primarily driven off of Asia and Europe if you think about it from that standpoint. So if you look at where year-over-year volumes increases occur, that would probably be where we saw the biggest increase. So think about areas where we lost share a year ago is probably where we gained the most share this year from that standpoint. And then sequential volume, it was a slight increase from fourth quarter to first quarter as well. Mark, I don’t know if you want to add anything to that?

Yes. Sequential volume up above 2% and I'd say just to echo the comments Mark made is we have been regaining share starting in the second half of 2019 with a focus really on plastics and more recently on laminates. I would also highlight that from a channel perspective we have been very leveraging our flex ecommerce portfolio which is a big value add to our consumers in terms of how they plan their purchases and I'd say probably from a regional perspective probably saw a little bit more strength in Asia again we've been seeing strength in the plastics business globally with a lot of packaging related to somewhat related to COVID-19. So I would say we're regaining share in areas where we had lost it, we're leveraging our flex channel which is really helpful in terms of price discovery as well as understanding customers order patterns and that's been really helpful for us.

Okay, thank you very much.

Thank. Your next response is from Vincent Andrews of Morgan Stanley. Please go ahead.

It’s actually Steve Haynes on for Vincent. Wanted to come back to TiO2 volumes and the comment you made I think in a response to an earlier question about volume kind of being sequentially down slightly in the second quarter. So I wanted to kind of help bridge that versus what some of your coatings customers have been saying where they're pointing some pretty significant volume declines for the second quarter. So I guess maybe if you could split apart like how April has been versus maybe May and June in terms of expectations for May and June would be helpful for us to understand?

Yes. So I would say that right now, we would say that it's going to be down versus the first quarter based on what we are seeing now I would say April was fairly anemic if you will, well I think we've seen some strengthening that’s happening but we're now starting to see this is pure demand that's coming downstream. Right? So remember what we're really reacting at this point from demand point of view. So I know we've talked a lot about market share gains from last year. And we've been on a steady path of trying to gain share getting back to what we believe is our capacity share goals we have said we would try to do that by the end of 2020 but with the pandemic in place we're not going to be pushing that beyond what it needs to be so that might take us into 2021 before we can get to those right gains of market share. So I I'd say the volume in the second quarter is going to be very much dependent on what demand is downstream and right now we're seeing a little bit weaker of a demand signal so is that in the low single digits is that in the low double digits I think we'll see. It's just a little bit too early to tell as I said it's the quarter started off slow we've seen it pick up a little bit but I think May and June are really going to be telling for the quarter. And to be honest with you Adam I think June is going to tell us what this quarter is going to look like from a volume perspective on the TiO2 side.

Yes Mark The only thing I'd add is there's just a lot of uncertainty here as we go into the second part of the quarter and we'll have to just wait and see.

Okay. Thanks guys. I appreciate it.

Thank you. Your next response is from P.J. Juvekar of Citi. Please go ahead.

Hi, good morning, Mark. It’s Eric Petrie.

Hey Eric.

How do you view TiO2 fundamentals currently compared to prior down cycles? Do you think recovery is slower if pricing has been more stable preventing capacity or reductions in past cycles?

Yes. I will give you my initial thoughts Mark might have some additional color to add to it. But I would say Eric that very different from past cycles you are coming out of a down cycle right as we went into this pandemic so as you look at last year I think we were we had bottomed out of the destocking period and remember this is probably one of the largest I think the second largest destocking event that this industry had seen so we were seeing the end of that we're starting to come out of it in the third and fourth quarter and then we were feeling good going into the year and then all of a sudden the pandemic hit so I think you're in a very different situation in that at least to the start of this downturn from the pandemic or demand so think of it as the demand slow down because of the pandemic you probably were in a very different situation you have prices which were fairly stable and you also have the fact that probably wasn't excess inventory the destocking period had sort of run its course now what you're going to have on the back end of this is going to be some levels of stimulus and that this industry has responded extremely well to stimulus it’s a GDP driven industry and stimulus usually uplifts GDP if you well and so especially in the construction sector so I think what you're going to see is when things start turning around when demand starts coming back when people are buying again and when stimulus kicks in I think that there is a an upside to this that's going to happen at the at the back end and it's not coming off of a peak and it's not coming off of absolute drop its coming off of a curve that’s starting to turn up before you hit this whole pandemic side.

Helpful. Thank you. And then on the Fluoroproducts business, you prior commented that you expect to full Opteon conversions the auto OEM by 2021 in the U.S. and Japan by 2023 Do those still hold or has it changed a bit given production cut back?

Yes, our anticipation, those still hold.

Thank you.

Thank you. Your next response is from Jim Sheehan of SunTrust Robinson. Please go ahead.

Good morning. This is Pete Osterland on for Jim. Just a question on TiO2 given that volumes were up a bit sequentially in the first quarter but then expected to be down in the second quarter how do you expect that margins next quarter will revert closer to what they were in the fourth quarter. Kind of that under 20% level or is there anything you are doing on the operational fronts that could reduce the margin impact there?

Yes, we typically don't guide quarter by quarter in terms of margin as we said earlier we're going to be very thoughtful as to our market approach to the point Mark made earlier we've been gaining share here as we move forward in time but in light of some of the demand impact in the quarter we're going to be very thoughtful as to how we approach the marketplace in terms of production we continue to look at ways to meet customer needs into giving the flexibility of our operating fleet globally and that would be our primary driver in the quarter.

Thank you.

Thank you. Your last question comes from Arun Viswanathan, please go ahead, RBC Securities.

Thank you. Good morning.

Morning.

Thanks for taking my question. I am just curious you discussed some of the order patterns and I'm just curious when you look out into Q3 and Q4 you had some price increases on the table do you still expect any potential success there in TiO2 just given that the recent situation? Thanks.

Yes, I would say Arun we don’t have a real good picture of what's going on in the rest of the year that's why we suspended our guidance from this point I think it's a little bit foggy from a demand point of view obviously our contracts our AVA contracts are set so what we know what pricing is going to be on the TiO2 side from the AVA contract side at least what was in the portal for us on our flex portal had higher prices later in the year than earlier in the year but you know we'll the beauty of that portal is that you can adjust that as you see fit in terms of what we are trying to get done. So this I think the best way to think about this industry specifically, the TiO2 industry right now is going to be demand is going to drive a lot of things right now. So, I don’t think you are going to – it’s not about capacity coming on board, it’s not about a bunch of supply, it’s really going to be what demand looks like and I think at this point in time, it’s very hard for us to predict what demand is going to be in the second half of the year, which is why we withdrew guidance from that standpoint.

Great. Thanks. And then I was just curious when you look at supply demand, there was inroads by some competitors in the last couple of years from China. And I guess would you expect that to continue and I mean meaning that maybe those suppliers are taking share or in this environment maybe given that there is somewhat maybe less financially flexible, was there an opportunity for you guys too actually regain some of that share back? Thanks.

Yes. We are going to continue our path on regaining share as I said we are going to be smart about that going forward. And if we are in a lower demand period, we are not going to cause any issues in the marketplace from that standpoint. We will drive the right behaviors that we need to do. But from a standpoint there is a slight dislocation I think going on in China where you had very low demand in the first quarter of the year. And so that’s why I think you saw the export numbers probably a little bit higher. As demand raises up in China, I think that will stabilize. So, I think that’s more of a function of demand in China than suppliers trying to move product somewhere. So again demand is going to drive this whole industry and the demand picture is going to be very interesting to watch and something we are going to stay very close to.

Thanks.

Thank you. At this time, there are no further questions. I would now like to turn the call back over to Mark Vergnano, President and CEO of Chemour. Please go ahead.

Thank you, Ditomora and thanks everyone for joining. I don’t think I ever imagine myself saying this, but I really miss seeing you guys. So, I am hopeful that we are going to able to get together at some point. Until then, I hope you all stay safe. I hope you all stay healthy and thank you as always for your support of the Chemours Company.

Ladies and gentlemen, this concludes today’s conference call. Thank you for participating. You may now disconnect.