Summary of Earnings Call for Asia EM Equity Strategy Industry Overview - The earnings results for Emerging Markets (EM) and Asia Pacific excluding Japan (APxJ) in 4Q CY24 were generally in line with expectations, with EM showing a slight increase of +0.8% and APxJ at +1.5% [2][10] - Japan reported a strong earnings season with a notable increase of +13.7%, driven by a high net beat ratio of +23 percentage points [2][6] - China also showed positive momentum with earnings growth of +7.7% [3][6] Sector Performance - The Communication Services sector led the earnings surprises with a +15.2% increase, particularly driven by Telecom Services which saw a remarkable +36.0% [4][31] - Real Estate also performed well with an earnings surprise of +11.9% [31] - Conversely, the Materials sector faced significant challenges, reporting a decline of -15.2%, with Paper & Forest Products showing a major miss at -68.4% [4][31] - Utilities also underperformed with a -6.9% surprise [31] Regional Insights - EEMEA (Eastern Europe, Middle East, and Africa) reported a solid aggregate beat of +6.8%, with notable contributions from the United Arab Emirates (+12.6%), Saudi Arabia (+9.1%), and South Africa (+8.6%) [3][6] - In contrast, Latin America faced major misses, with an overall decline of -16.8%, primarily due to Brazil (-20.7%), Chile (-20.3%), and Mexico (-10.8%) [3][6] Key Stock-Level Surprises - A list of companies expected to see upward revisions in their earnings estimates includes: - Sea Ltd (Communication Services) with a market cap of $76.85 billion and a price target upside of 31% [5] - XPeng Inc. (Consumer Discretionary) with a market cap of $19.21 billion and an expected upside of 18% [5] - Tenaga Nasional (Utilities) showing a significant upside potential of 53% [5] Earnings Surprise Ratios - Japan's earnings surprise ratio was the highest at 13.7%, with 54% of companies reporting above expectations [6][25] - In contrast, Brazil had the lowest surprise ratio at -20.7%, with 28% of companies missing consensus [6][25] Additional Insights - The breadth of earnings surprises was weaker across EM and APxJ, with EM showing a -7 percentage point breadth and APxJ at -4 percentage points [2][6] - The overall revenue performance across the region slightly beat expectations, with EM at +1.8%, APxJ at +1.4%, and Japan at +1.9% [2][6] This summary encapsulates the key findings from the earnings call, highlighting the performance of various sectors and regions, as well as specific stock-level surprises that may present investment opportunities.

Core Viewpoint - LyondellBasell Industries N.V. and Covestro have decided to permanently shut down the Propylene Oxide Styrene and Monomer production unit at the Maasvlakte site in the Netherlands due to ongoing profitability pressures from global overcapacities and high production costs in Europe [1][2]. Group 1: Company Actions and Decisions - The closure of the POSM production unit was made after careful consideration of the profitability challenges faced by the Maasvlakte site, influenced by increased imports from Asia [2]. - LyondellBasell will ensure a safe shutdown process for the asset, expected to be completed by the end of 2026 [3]. Group 2: Market Conditions and Expectations - The company anticipates that macroeconomic drivers will eventually lead to supply chain replenishment and increased demand for durable goods, aiding economic recovery [4]. - Seasonal demand gains are expected across most product categories in the first quarter, supported by interest rate cuts and inflation moderation [5]. Group 3: Stock Performance and Rankings - LyondellBasell's stock has declined by 28% over the past year, compared to a 13.1% decline in the industry [3]. - The company currently holds a Zacks Rank of 3 (Hold), while other companies in the Basic Materials sector have higher rankings, indicating potential investment opportunities [6].

Core Viewpoint - The Dow Chemical Company ("TDCC") has announced a tender offer to purchase certain debt securities for an aggregate consideration of up to $1.0 billion, which includes securities from its subsidiaries Rohm and Haas and Union Carbide Corporation [1][10]. Group 1: Tender Offer Details - The tender offer is part of TDCC's strategy to manage its debt and is detailed in the Offer to Purchase dated February 25, 2025 [1][10]. - The early participation date for the tender offer was set for March 10, 2025, and the expected early settlement date is March 13, 2025 [5][6]. - Holders of validly tendered securities will receive total consideration in cash, which includes an early participation amount of $30 per series of securities [4][6]. Group 2: Securities Information - The tender offer includes various series of securities, with specific amounts and terms outlined, such as the 0.500% Notes Due 2027 and the 7.850% Debentures Due 2029, which have been accepted for purchase [3][9]. - The total consideration for each $1,000 or €1,000 principal amount of securities validly tendered includes accrued interest from the last payment date to the early settlement date [7][8]. - Due to the tender cap, not all tendered securities will be accepted; only specific amounts of certain securities will be purchased on a prorated basis [9]. Group 3: Financial Management - TDCC has retained Citigroup Global Markets Inc. and HSBC Securities (USA) Inc. as joint lead dealer managers for the tender offer, indicating a structured approach to managing the transaction [11]. - The company aims to optimize its capital structure through this tender offer, reflecting a proactive stance in financial management [1][10]. Group 4: Company Background - Dow Inc. operates as a leading materials science company with a focus on high-growth markets, achieving approximately $43 billion in sales in 2024 [14]. - Rohm and Haas and Union Carbide Corporation are wholly owned subsidiaries of TDCC, contributing to its diversified portfolio in chemicals and polymers [15].

Core Insights - DuPont's Pyralux® ML Series of double-sided metal-clad laminates has won the 2025 NPI Award in the Laminates category, recognizing its innovation in the electronics assembly industry [1][4]. Product Overview - Launched in April 2024, Pyralux® ML laminates are designed for flexible and rigid-flex printed circuit boards (PCBs), focusing on optimal thermal management for high-reliability markets such as aerospace, defense, electric vehicles (EVs), and AI-related networking [2][3]. - The laminates utilize metal alloy technology, including copper-nickel (CuNi) and Kapton® all-polyimide dielectric technology, which enhances resistivity, reduces thermal conductivity, and provides necessary thermoelectric properties [3]. Evaluation Criteria - The NPI Award evaluations considered various factors such as creativity, innovation, compatibility with existing technology, cost-effectiveness, design, reliability, flexibility, performance, user-friendliness, and speed/throughput [3]. Company Recognition - The recognition of Pyralux® ML laminates highlights the product's role in optimizing thermal management, which is crucial for industries with high-performance and high-reliability requirements [4].

Group 1 - Dow Inc. will participate in a fireside chat at the J.P. Morgan Industrials Conference on March 13, 2025, at 8:15 a.m. ET [1] - Investors can join the live webcast through Dow's website, with a replay and transcript available after the event [1] Group 2 - Dow is a leading materials science company, serving high-growth markets such as packaging, infrastructure, mobility, and consumer applications [2] - The company operates manufacturing sites in 30 countries and employs approximately 36,000 people [2] - Dow reported sales of approximately $43 billion in 2024 [2]

Core Insights - LyondellBasell Industries N.V. has introduced Pro-fax EP649U, a polypropylene impact copolymer aimed at the rigid packaging market, particularly for food packaging applications [1] - The new product features high-flowing properties, fast crystallization, and an additive package that enhances mold release and downstream handling [2] - Pro-fax EP649U is part of the CirculenRenew and CirculenRevive portfolios, emphasizing sustainable innovation with renewable or recycled content [4] Product Features - Pro-fax EP649U is designed for thin-walled injection molding, providing strength without compromising wall thickness, and offers lightweight and impact resistance [2] - The product includes nucleated anti-stat and organoleptic properties, preventing unwanted taste and odor transfer to packaged goods [3] Market Outlook - The company anticipates a recovery in North American domestic demand for polyolefins in 2024, following two years of decline, with expected seasonal demand gains in the first quarter [5] - Macroeconomic factors such as interest rate cuts, inflation moderation, and pent-up demand are expected to boost consumption of durable goods, positively impacting the company's polypropylene and Intermediates and Derivatives businesses [5] Stock Performance - LyondellBasell's stock has declined by 23.2% over the past year, compared to an 8.3% decline in the industry [4] - The company currently holds a Zacks Rank of 5 (Strong Sell), indicating a challenging market position [6]

Financial Data and Key Metrics Changes - Consolidated sales for Q4 2024 were $477 million, down from $513 million in the prior year, reflecting a 7% decrease [12][24] - Adjusted EBITDA for Q4 2024 was $55 million with an adjusted EBITDA margin of 11.6%, compared to $53.9 million and 10.5% in the prior year [12][15] - Full-year 2024 consolidated sales totaled $2.09 billion, a decrease of 3% from $2.15 billion in 2023 [14][24] - Full-year adjusted EBITDA was a record $261.6 million, with a margin of 12.5%, up from 11.9% in the prior year [15][16] - Diluted earnings per share for 2024 were $2.46, down from $4.14 in the prior year [16] - Operating cash flow for 2024 was $119.4 million, compared to $146.1 million in the prior year [16] Business Line Data and Key Metrics Changes - Railroad Utility Products and Services (RUPT) sales were flat year-over-year at $216 million, with adjusted EBITDA of $18 million and an 8% margin [24][25] - Performance Chemicals (PC) sales decreased to $148 million from $164 million, with adjusted EBITDA remaining flat at $29 million [28][29] - Carbon Materials and Chemicals (CMC) sales were $114 million, down from $132 million, with adjusted EBITDA increasing to $9 million from $4 million in the prior year [31][32] Market Data and Key Metrics Changes - RUPT achieved record sales for the year, increasing by $45 million or 5%, while PC sales decreased by $20 million or 3% [24][25] - CMC sales decreased by $87 million or 15% compared to the prior year [24][25] - The average pricing of major products was down 13%, and average coal tar costs were down 18% [33][34] Company Strategy and Development Direction - The company plans to focus on cost control and efficiency gains across all business segments in response to market share loss and economic uncertainty [49] - A virtual investor day is scheduled for September 18, 2025, to unveil the details of the 2030 strategic plan [17][71] - The company aims for a net leverage ratio of 2 to 3 times, with expectations to end 2025 at or below 3 times leverage [38][39] Management's Comments on Operating Environment and Future Outlook - Management expressed disappointment in falling short of financial expectations for Q4 and full year 2024, citing volume slowdowns and market share loss as key factors [8][9] - The outlook for 2025 includes expectations of earnings improvement driven by top-line growth and cost containment measures [10][11] - Management remains cautiously optimistic about customer sentiment and market conditions, particularly in the North American market [46][47] Other Important Information - The company reported a 5% reduction in its global workforce, expected to result in over $10 million in savings for 2025 [10] - The board authorized a new $100 million stock repurchase program and increased the quarterly dividend to $0.08 per share [36][41] - The company was recognized by Newsweek as one of America's most responsible companies for the fifth consecutive year [20] Q&A Session Summary Question: What is your competitor strategy regarding market share loss in Performance Chemicals? - Management indicated that the market share loss was anticipated and attributed to competitors diversifying their supply chains and investing in capacity [78][80] Question: Are there immediate plans for investment in Utility and Industrial Products? - Management stated that previous investments are expected to provide growth opportunities, but no immediate capital needs are foreseen [84][88] Question: What is the expected impact of the Stickney plant closure on sales? - The closure is expected to result in a loss of approximately $30 million to $35 million in sales, but it will not impact creosote production [97][99] Question: How will free cash flow be allocated in 2025? - Management plans to allocate free cash flow towards share repurchases and debt paydown, aiming to reduce leverage significantly [107][110] Question: What improvements are expected in the RUPS segment regarding crosstie volumes? - Management projected an 8% increase in crosstie volumes for 2025, with expectations for higher pricing as well [111][112]

Core Viewpoint - The article discusses the macroeconomic inventory cycle and its impact on commodity trading, highlighting the challenges in relying on U.S. demand to drive global economic growth in 2025 due to low inventory levels in China and potential recession risks in the U.S. [3][10] Group 1: Macro Inventory Cycle - The macro inventory cycle is crucial for understanding systemic risks in commodities, with historical trading logic based on inventory changes leading to various market phenomena [4][11]. - The article outlines different macro trading logics for various years, including U.S. recession in 2024 and China's inventory reduction in 2023 [5][6][10]. Group 2: Commodity Trading Phenomena - Several unusual phenomena in commodity trading are identified, such as significant price drops despite low inventory levels and high inventory not leading to price increases [11][12]. - A model developed to explain these phenomena shows a correlation between basis rates and commodity prices, indicating that understanding when to focus on supply-demand logic versus macro logic is essential [14]. Group 3: U.S. Economic Indicators - Key economic indicators from the U.S. show mixed signals, with manufacturing PMI at a 17-month high while service sector PMI has declined significantly [26][27]. - Consumer confidence in the U.S. has dropped for three consecutive months, reaching its lowest level since June 2024, indicating potential economic challenges ahead [28]. Group 4: Future Outlook - The article suggests that if issues arise in the Western economy, the probability of such events may be higher than previously thought, with a potential shift of capital from the West to the East beginning in 2025 [29].

Financial Data and Key Metrics Changes - For Q4 2024, the company reported sales of $2.8 billion and EBITDA of $416 million, representing a 7% increase in EBITDA compared to Q4 2023's EBITDA of $390 million [17][24] - Full year 2024 net income was $677 million, with EBITDA totaling $2.3 billion, while total sales for 2024 declined by 3% to $12.1 billion due to a 10% decline in average sales prices [25][26] - The company achieved total cost reductions of $170 million in 2024, exceeding the target of $125 million to $150 million [16][32] Business Segment Data and Key Metrics Changes - The Housing and Infrastructure Products (HIP) segment achieved record income from operations of $807 million and an EBITDA margin of 24%, driven by an 8% sales volume growth [20][28] - The Performance and Essential Materials (PEM) segment saw a 1% increase in sales volume, primarily due to export market demand, although average sales prices were impacted by industry capacity increases [18][30] - HIP's EBITDA margin improved to 19% in Q4 2024, while PEM's EBITDA margin increased to 12% from 11% in the same period of 2023 [27][31] Market Data and Key Metrics Changes - North America showed strong demand across both segments, supported by a broad product portfolio and a strong feedstock position [19] - The company expects housing starts for 2025 to remain similar to 2024 at 1.3 million [33] Company Strategy and Development Direction - The company is focused on sustainability and has initiated several key projects, including a pilot program for post-consumer recycled PVC and investments in carbon waste transformation technology [36][37] - The company plans to continue optimizing its business to drive operational performance and reduce costs, with a target of $125 million to $150 million in cost reductions for 2025 [42] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth potential of the HIP segment, citing strong brand offerings and geographical reach [39][41] - The company acknowledges uncertainties in the global macroeconomic environment but remains focused on actions within its control to improve business performance [41] Other Important Information - The company returned approximately $325 million to shareholders through dividends and share repurchases in 2024 [21][32] - As of December 31, 2024, the company had $2.9 billion in cash and cash equivalents, with total debt of $4.6 billion [31] Q&A Session Summary Question: Insights on HIP margins and expected degradation - Management indicated that margin guidance reflects a product mix shift rather than a decline in overall demand [49] Question: Cost cuts distribution across divisions - Cost reduction efforts will be significant in both HIP and PEM segments, particularly in logistics and procurement [52] Question: Concerns about homebuilder outlook affecting volumes - Management remains confident in growth, expecting market penetration to increase despite broader economic concerns [59] Question: Impact of tariffs on PVC trade flows - Management is monitoring potential impacts of tariffs on trade patterns and will adapt as necessary [62] Question: Volume and price changes for the year - Year-over-year volume improvements were 6% for PEM and 8% for HIP, with price declines of 12% for PEM and 6% for HIP [81][84] Question: Free cash flow outlook for 2025 - Management expects stronger free cash flow generation in 2025 due to continued strength in the HIP business [90] Question: Recent demand experience in major product lines - Demand for polyethylene remains strong, with price initiatives reflecting good market conditions [118] Question: Expectations for EBITDA margins in 2025 - Management views the 20% to 22% EBITDA margin guidance as conservative, with potential for improvement if housing starts increase [132]

Financial Data and Key Metrics Changes - Tronox generated revenue of $3.1 billion in 2024, an increase of 8% compared to the prior year, driven primarily by higher TiO2 and zircon sales volumes, partially offset by unfavorable price and product mix [10] - The company reported a net loss attributable to Tronox of $48 million for the full year, with adjusted EBITDA of $564 million and an adjusted EBITDA margin of 18.3% [10] - In Q4 2024, revenue was $676 million, a decrease of 1% year-over-year, with a net loss of $30 million and adjusted EBITDA of $129 million, achieving an adjusted EBITDA margin of 19.1% [11][10] Business Line Data and Key Metrics Changes - TiO2 revenues increased by 3% year-over-year in Q4, with sales volumes improving by 4%, but were partially offset by a 1% decline due to price and product mix [11] - Zircon revenues surged by 32% year-over-year in Q4, driven by a 43% increase in sales volumes, despite an 11% headwind from price and product mix [12] - Revenue from other products decreased by 38% year-over-year due to opportunistic sales that did not repeat in Q4 2024 [13] Market Data and Key Metrics Changes - Stronger TiO2 commercial performance in Asia Pacific and Latin America helped mitigate lagging demand in Europe, while North America performed in line with expectations [6] - The company noted competitive dynamics affecting pricing across all products, with expectations for price recovery in the second half of 2025 [30][29] Company Strategy and Development Direction - Tronox is focusing on sustainability projects, including converting 40% of its power in South Africa to solar, which avoided $17 million in electricity costs in 2024 [8] - The company launched a new business strategy in the second half of 2024, emphasizing cost efficiency, optimizing asset reliability, and driving operational excellence [9] - Tronox identified $125 million to $175 million of additional cost improvement opportunities achievable by the end of 2026 [9] Management's Comments on Operating Environment and Future Outlook - Management expects 2025 revenue to range from $3 billion to $3.4 billion, with adjusted EBITDA between $525 million and $625 million, considering market recovery and competitive dynamics [18] - The company anticipates a stronger second half of 2025, with pricing expected to improve as market conditions stabilize [19] - Management highlighted ongoing challenges with mining production costs, projecting a negative impact of $50 million to $60 million in 2025 due to transitioning to new mines [40][41] Other Important Information - Tronox's total debt stood at $2.9 billion, with a net leverage ratio of 4.8 times at year-end [15] - The company returned $80 million to shareholders in dividends during 2024 [16] Q&A Session Summary Question: What is driving the softer pricing in the first half of the year? - Management noted competitive activity in certain regions and a slow recovery period, with expectations for price increases in the second half of the year as market conditions improve [26][30] Question: How much of the cost improvement program relies on volumes versus efficiency? - The cost improvement program focuses primarily on cost efficiencies rather than volume increases, with expectations to achieve $25 million to $30 million of improvements in 2025 [31][32] Question: What is the expected impact of mining costs in 2025? - The majority of the $50 million to $60 million negative impact is expected in the first half of 2025, with recovery anticipated in 2026 as new mines come online [40][41] Question: How are raw material costs trending for 2025? - Raw material costs are expected to decline in the low single digits year-over-year, with specific increases in electricity and coal costs [84][85] Question: What is the outlook for TiO2 market share? - Management indicated that while some share has been lost to Chinese competitors, there are opportunities for recovery, particularly in regions benefiting from trade duties [68][69]