Trinseo(TSE) - 2025 Q2 - Quarterly Report

PART I — FINANCIAL INFORMATION This section presents Trinseo PLC's unaudited condensed consolidated financial statements and management's discussion and analysis for the periods ended June 30, 2025 and 2024 Item 1. Financial Statements This section presents the unaudited condensed consolidated financial statements of Trinseo PLC, including balance sheets, statements of operations, comprehensive income (loss), shareholders' equity (deficit), and cash flows, along with detailed notes explaining the basis of presentation, accounting policies, and specific financial items for the periods ended June 30, 2025 and 2024 Condensed Consolidated Balance Sheets The balance sheet shows a slight decrease in total assets from $2,644.1 million at December 31, 2024, to $2,631.9 million at June 30, 2025, while total liabilities increased and shareholders' equity (deficit) worsened | Metric | Dec 31, 2024 (Millions $) | Jun 30, 2025 (Millions $) | Change (Millions $) | | :-------------------------------- | :------------------------ | :------------------------ | :------------------ | | Total Assets | 2,644.1 | 2,631.9 | (12.2) | | Total Liabilities | 3,264.0 | 3,382.2 | 118.2 | | Total Shareholders' Equity (Deficit) | (619.9) | (750.3) | (130.4) | | Cash and cash equivalents | 209.8 | 137.0 | (72.8) | | Accounts receivable, net | 379.9 | 433.9 | 54.0 | | Inventories | 347.2 | 378.0 | 30.8 | | Short-term borrowings and current portion of long-term debt | 210.9 | 170.0 | (40.9) | | Long-term debt, net | 2,200.7 | 2,321.2 | 120.5 | Condensed Consolidated Statements of Operations The company reported increased net losses for both the three and six months ended June 30, 2025, compared to the prior year, driven by lower net sales, reduced gross profit, and higher selling, general, and administrative expenses | Metric | 3 Months Ended Jun 30, 2025 (Millions $) | 3 Months Ended Jun 30, 2024 (Millions $) | Change (Millions $) | 6 Months Ended Jun 30, 2025 (Millions $) | 6 Months Ended Jun 30, 2024 (Millions $) | Change (Millions $) | | :-------------------------------- | :-------------------------------- | :-------------------------------- | :------------------ | :-------------------------------- | :-------------------------------- | :------------------ | | Net sales | 784.3 | 920.0 | (135.7) | 1,569.1 | 1,824.0 | (254.9) | | Gross profit | 36.6 | 68.4 | (31.8) | 100.4 | 129.0 | (28.6) | | Operating income (loss) | (33.3) | 13.9 | (47.2) | (62.3) | 10.6 | (72.9) | | Net loss | (105.5) | (67.8) | (37.7) | (184.5) | (143.3) | (41.2) | | Net loss per share—basic | (2.95) | (1.92) | (1.03) | (5.18) | (4.06) | (1.12) | Condensed Consolidated Statements of Comprehensive Income (Loss) The company reported a comprehensive loss of $73.5 million for the three months ended June 30, 2025, and $133.6 million for the six months, an improvement from the prior year's six-month loss, primarily due to positive cumulative translation adjustments and pension gains, partially offsetting the net loss | Metric | 3 Months Ended Jun 30, 2025 (Millions $) | 3 Months Ended Jun 30, 2024 (Millions $) | 6 Months Ended Jun 30, 2025 (Millions $) | 6 Months Ended Jun 30, 2024 (Millions $) | | :-------------------------------- | :-------------------------------- | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Net loss | (105.5) | (67.8) | (184.5) | (143.3) | | Cumulative translation adjustments | 32.3 | (4.4) | 51.8 | (16.2) | | Total other comprehensive income (loss), net of tax | 32.0 | — | 50.9 | (7.8) | | Comprehensive loss | (73.5) | (67.8) | (133.6) | (151.1) | Condensed Consolidated Statements of Shareholders' Equity (Deficit) The company's total shareholders' equity (deficit) decreased significantly from $(619.9) million at December 31, 2024, to $(750.3) million at June 30, 2025, primarily due to net losses and dividend payments, partially offset by other comprehensive income and share-based compensation activity | Metric | Dec 31, 2024 (Millions $) | Jun 30, 2025 (Millions $) | Change (Millions $) | | :-------------------------------- | :------------------------ | :------------------------ | :------------------ | | Total Shareholders' Equity (Deficit) | (619.9) | (750.3) | (130.4) | | Accumulated Deficit | (792.8) | (978.1) | (185.3) | | Accumulated Other Comprehensive Loss | (142.1) | (91.2) | 50.9 | | Net loss (6 months) | N/A | (184.5) | N/A | | Dividends on ordinary shares (6 months) | N/A | (0.8) | N/A | Condensed Consolidated Statements of Cash Flows For the six months ended June 30, 2025, the company experienced a net decrease in cash, cash equivalents, and restricted cash of $72.7 million, an improvement from the $153.2 million decrease in the prior year, driven by reduced cash used in operating and investing activities, and a shift to cash provided by financing activities | Metric | 6 Months Ended Jun 30, 2025 (Millions $) | 6 Months Ended Jun 30, 2024 (Millions $) | Change (Millions $) | | :-------------------------------- | :-------------------------------- | :-------------------------------- | :------------------ | | Cash used in operating activities | (103.4) | (108.1) | 4.7 | | Cash used in investing activities | (18.5) | (21.7) | 3.2 | | Cash provided by (used in) financing activities | 42.2 | (19.8) | 62.0 | | Net change in cash, cash equivalents, and restricted cash | (72.7) | (153.2) | 80.5 | | Cash and cash equivalents—end of period | 137.0 | 105.6 | 31.4 | Notes to Condensed Consolidated Financial Statements This section provides detailed explanations and disclosures for the condensed consolidated financial statements, covering accounting policies, segment realignment, restructuring activities, debt structure, derivative instruments, fair value measurements, commitments, contingencies, pension plans, share-based compensation, and accumulated other comprehensive income (loss) NOTE 1—BASIS OF PRESENTATION The interim financial statements are unaudited and prepared under GAAP, reflecting management's estimates, with a segment realignment effective October 1, 2024, to focus on sustainability and material substitution, resulting in four segments with prior year information recast - Segment realignment effective October 1, 2024, combining Compounding with Engineered Materials and remaining Plastics Solutions with Polystyrene (renamed Polymer Solutions)[34] - Four reporting segments: Engineered Materials, Latex Binders, Polymer Solutions, and Americas Styrenics[34] - Prior year information recast to reflect current segment structure[34] NOTE 2—RECENT ACCOUNTING GUIDANCE As of June 30, 2025, there were no recently issued accounting standards identified that would have a material effect on the company's condensed consolidated financial statements - No material impact from recently issued accounting standards as of June 30, 2025[36] NOTE 3—NET SALES Net sales to external customers decreased across all segments for both the three and six months ended June 30, 2025, compared to 2024, with Europe being the largest market, followed by the United States | Segment | 3 Months Ended Jun 30, 2025 (Millions $) | 3 Months Ended