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It's been a volatile year for specialty chemical company Chemours (CC), which has experienced a shake-up at both the CEO and CFO positions, while enduring a severe drought in Mexico this summer that forced it to pause production at one of its largest factories. However, this morning, CC delivered better-than-expected Q3 results that featured record net sales in its Thermal & Specialized Solutions (TSS) segment, indicating that its business has now stabilized and is positioned to generate stronger results heading into FY25.

• Prior to CC's Q3 report, the company had posted yr/yr net sales declines in six of the past seven quarters as the company grappled with price declines and lower volumes, particularly in the Advanced Performance Materials (APM) segment, amid soft market conditions and high interest rates. In Q3, though, net sales growth flipped to +0.9%, mainly driven by stronger-than-expected volumes across each of CC's segments.
• The standout performer was TSS, which produces refrigerants, thermal management products, and propellants. Bolstered by a 21% jump in Opteon Refrigerants, TSS's net sales grew by 6% to $460 mln, exceeding the company's expectations. Like last quarter, elevated hydrofluorocarbon (HFC) inventory levels weighed on refrigerant pricing across the market, but strong demand for CC's Opteon Refrigerant product helped to mitigate that headwind. Overall, pricing was down just 2% for the TSS segment, while volume increased by 8%.
• Turning to Titanium Technologies (TT), net sales were down by 2% yr/yr to $679 mln, but this marked an improvement from last quarter's 5% drop. This segment, which manufacturers TiO2 pigment that's used in coatings, paints, and packaging, was particularly impacted by the drought in Mexico. Even though the drought has since passed, CC is still contending with lingering constraints that affected capacity early in Q3. However, volume was still higher by 1% yr/yr, exceeding CC's expectations, and the company believes it's now well-positioned to meet improving market demand as interest rates move lower.
• Meanwhile, the APM segment is still experiencing softness in some of its more macroeconomically-sensitive end markets, such as electronics and communications, pushing price lower by 7% in Q3. The good news, though, is that volume growth returned across the portfolio, enabling net sales to edge higher by 1% yr/yr to $348 mln. 

CC's new executive team of CEO Denise Dignam and CFO Shane Hostetter, who transitioned into their new roles on March 22, 2024, and June 5, 2024, respectively, have the company heading in the right direction following a turbulent period earlier this year. The company is currently in a seasonally slow quarter -- it guided for a mid-to-single digit sequential net sales decline for TT, and a low-teens decline for TSS -- but FY25 is looking brighter for CC as rate cuts in the U.S. and Europe drive a continued macro recovery.