Chemours posts $237M loss, looks to 'unlock the value' as it moves on from financial scandal

WILMINGTON, Del.—Chemours Co. has released full-year financial results for 2023 as the materials maker looks to recover from a financial scandal that led to the departure of its CEO.

Wilmington-based Chemours posted sales of a little more than $6 billion in 2023, down 11 percent vs. 2022, while showing a loss of $237 million. The firm had shown a profit of $578 million in 2022.

The financial results had been delayed from February due to an investigation into former CEO Mark Newman and two other executives.

Denise Digman was named interim CEO in late February, and that move was made permanent on March 22. Dignam joined Chemours in 2015 and had served as president of the firm's Titanium Technologies unit since March 2023. She has more than 35 years of chemical industry experience overall.

During a March 28 conference call, Dignam said she "has great confidence in this company, our values and our people."

"We are facing challenges, but we have an opportunity to unlock the value of Chemours," she added.

Chemours' businesses have "two dynamics," according to Dignam. "In mature markets, we must have the lowest cost position," she said. "We also plan to grow through technology improvements."

Chemours "already has changed the way we operate at the top of our business," Dignam added. "We're now business-led, not corporate-led. We'll work to reinforce our values. Our values are why people choose Chemours."

Newman and two the other executives were placed on leave in late February. A company investigation showed they had delayed making payments to suppliers, while at the same time accelerating payments from customers. The executives took these steps to meet goals that increased their compensation.

In total, the three executives delayed or accelerated payments totaling about $575 million in late 2022, early 2023, late 2023 and early 2024, according to a company news release.

Chemours on March 22 entered into a separation and release agreement with Newman. The other two executives—Senior Vice President and Chief Financial Officer Jonathan Lock and Vice President, Controller and Principal Accounting Officer Camela Wisel—remain on administrative leave as of March 28.

In an SEC filing, Chemours officials said Newman isn't entitled to any severance, equity award vesting or other compensation in connection with his resignation, other than any rights he has to vested benefits under terms of the firm's employee benefit plans.

They added that Newman has agreed to cooperate with Chemours in connection with its continued review with respect to the firm's accounting. That includes, to the extent applicable, Newman's conduct, with respect to the improper activities, officials said.

Chemours is a supplier of titanium dioxide, a common plastics whitener, as well as fluoropolymers and fluoroelastomers.

Fourth quarter sales at the firm's Titanium Technologies unit—including titanium dioxide—were up 7 percent to $651 million.

Sales at the firm's Advanced Performance Materials unit—including fluoropolymers—were down 15 percent to $325 million.

Chemours' financial loss for 2023 includes pretax litigation settlements and restructuring, asset-related charges and other charges.

In 2023, it agreed to pay $592 million to U.S. water suppliers for issues related to PFAS chemicals. Chemours also has agreed to pay $55 million to the state of Ohio for similar issues.

On the conference call, Dignam was asked about employee turnover at Chemours, including the three officials named in the report.

"There's no attrition problem at our company," she said. "We have deep experience across the organization and we have confidence in where we are in our customer base and in employees with business leadership."

"We don't want turbulence, but change is good," Dignam added.

The review that led to the actions against the three officials involved an anonymous report made to the Chemours ethics hotline.

Based on the review, the board's audit committee determined that the three executives "engaged in efforts in the fourth quarter of 2023 to delay payments to certain vendors that were originally due to be paid in the fourth quarter of 2023 until the first quarter of 2024."

The committee also determined the three "made efforts to accelerate the collection of receivables into the fourth quarter of 2023 that were originally not due to be received until the first quarter of 2024."

Newman had been president and CEO of Chemours since June 2021. He joined Chemours predecessor DuPont Co. in 2014 then became Chemours CFO in 2015, the same year it was spun off from DuPont. Chemours previously had been DuPont's Performance Materials unit. Prior to DuPont, Newman held financial positions at Sun Coke Energy, General Motors and Ally Financial.

Lock joined Chemours in 2018 and had been CFO since June 2023. Like Newman, he had previous experience at Sun Coke Energy. Wisel had been with Chemours since its launch in 2015. She previously held financial roles at materials maker Trinseo and financial firm Price Waterhouse Coopers.

On Wall Street, news of the executive actions sent Chemours' stock price down more then 30 percent to less than $20 on Feb. 29 when the investigation first was disclosed.

The price has recovered from that point and was near $27 in early trading March 28, down about 7 percent from its closing price the day before the announcement.