Tronox Holdings plc

Company Overview

Business Model: Tronox Holdings plc is the world’s leading vertically integrated manufacturer of titanium dioxide (TiO2) pigment. The Company operates titanium-bearing mineral sand mines and beneficiation and smelting operations in Australia and South Africa to produce feedstock materials, including ilmenite, leucoxene, rutile, titanium slag, and synthetic rutile. These feedstocks are processed into TiO2 pigment, high purity titanium chemicals (such as titanium tetrachloride), and ultrafine TiO2 for specialty applications. The strategy emphasizes self-sufficiency in feedstock production for its seven pigment facilities located in the United States, Australia, Brazil, United Kingdom, France, and the Kingdom of Saudi Arabia. Co-products from mining and smelting, including zircon, pig iron, and the rare-earth bearing mineral monazite, are also supplied to customers globally. Approximately 90% of TiO2 pigment production capacity utilizes the chloride process, with the remaining 10% using the sulfate process.

Market Position: Tronox Holdings plc holds a leading position as a vertically integrated TiO2 pigment manufacturer. The Company believes there is no effective substitute for TiO2 pigment due to its superior opacity, brightness, and cost-effectiveness. It supplies TiO2 under the TIONA® and CristalActiv® brands to approximately 1,200 customers in about 120 countries, including market leaders, with a track record of supplying its top ten customers for over 10 years. The chloride process, which accounts for 90% of the Company's TiO2 capacity, represents substantially all industry-wide TiO2 production capacity in North America and approximately 40% globally. The Company faces significant competition from global players like Chemours, LB Group, Kronos Worldwide Inc., and INEOS, as well as numerous regional producers, particularly in Eastern Europe and China. In the zircon market, China accounts for approximately 50% of global demand.

Recent Strategic Developments:

• Low-Cost TiO2 Producer Strategy: The Company reinforced its commitment to vertical integration, successfully commissioning the Fairbreeze extension and completing construction at Namakwa East OFS in South Africa. These major mining projects are expected to provide abundant reserves of natural rutile, zircon, and high-grade ilmenite, ensuring a secure and cost-effective feedstock supply and are projected to deliver returns above the Company's cost of capital.
• Sustainable Cost Improvement Program: A comprehensive program launched in 2025 delivered over $90 million in annualized savings by year-end 2025, with a target of $125-$175 million in annualized savings by the end of 2026. This initiative focuses on Operational Excellence, Technology Enablement, Supply Chain Optimization, and Selling, General & Administrative Expenses Alignment.
• Liquidity Management: Proactive measures included a $400 million senior secured bond offering in September 2025 and a 60% reduction in the quarterly dividend, effective in the third quarter of 2025. Operational adjustments to manage cash flow included shutting down the Botlek pigment plant in the Netherlands, idling the Fuzhou pigment plant in China (with permanent closure announced in January 2026), and temporarily idling one furnace at the Namakwa smelter.
• Rare Earth Oxides Development: Leveraging existing monazite resources in South Africa and Australia, the Company is developing a rare earth supply chain. In 2025, it received non-binding letters of support/interest for up to $600 million in financing from Export Finance Australia and Export-Import Bank of the United States. The Company also acquired an approximate 5% equity interest in Lion Rock Minerals, a mineral exploration company with potential monazite and rutile deposits. A pre-feasibility study for a rare earth "cracking and leaching" facility was completed in 2025, with further development expected in 2026.

Geographic Footprint: Tronox Holdings plc operates globally with mining and beneficiation operations in Australia and South Africa, and seven TiO2 pigment facilities across the United States, Australia, Brazil, United Kingdom, France, and the Kingdom of Saudi Arabia.

• Revenue Distribution (2025):
  • Europe, Middle-East and Africa: 40.2%
  • Asia Pacific: 27.3%
  • North America: 25.8%
  • South and Central America: 6.7%
• Employee Distribution (approximate):
  • Africa: ~2,000
  • North America: ~1,000
  • Europe: ~1,000
  • Asia: ~1,000 (prior to Fuzhou closure)
  • Australia: ~1,000
  • South America: ~500

Financial Performance

Revenue Analysis

Profitability Metrics:

• Gross Margin: 9.3% (2025) vs 16.8% (2024)
• Operating Margin: -8.7% (2025) vs 7.1% (2024)
• Net Margin: -16.3% (2025) vs -1.8% (2024)

Investment in Growth:

• R&D Expenditure: $15 million (0.5% of revenue)
• Capital Expenditures: $341 million
• Strategic Investments: Commissioning of Fairbreeze extension and Namakwa East OFS mining projects; $600 million in non-binding letters of support/interest for rare earth supply chain development; approximate 5% equity interest in Lion Rock Minerals; 200 MW solar energy project in South Africa (fully operational in 2025); second large-scale renewable energy project in South Africa (expected fully operational by end of 2027).

Business Segment Analysis

Tronox Holdings plc operates as one operating and reportable segment. The following provides a breakdown of revenue by primary product categories:

Titanium Dioxide (TiO2)

Financial Performance:

• Revenue: $2,298 million (-4.5% YoY)
• Key Growth Drivers: A decrease of $83 million in average selling prices (including mix) and a $54 million decrease in sales volumes were partially offset by a $28 million positive impact from foreign currency exchange rates, primarily due to the strengthening of the Euro.

Product Portfolio:

• TIONA® TiO2 pigment for paints, coatings, plastics, and paper.
• CristalActiv® ultrafine specialty TiO2 for NOx emission control products.

Market Dynamics:

• TiO2 pigment is a critical component in paints, coatings, plastics, and paper, valued for its whiteness, brightness, and opacity.
• Rutile TiO2 is preferred for many large end-use applications due to superior hiding power and durability.
• Sales volume by end-use market (2025): Paints & Coatings (55%), Plastics (25%), Paper (5%), Other (15%).

Zircon

Financial Performance:

• Revenue: $274 million (-14.9% YoY)
• Key Growth Drivers: Primarily driven by a 14% decrease in average selling prices (including mix) and a 1% decrease in sales volumes.

Product Portfolio:

• Zircon (ZrSiO4) co-product from mineral sands mining.

Market Dynamics:

• Used as an additive in ceramic glazes to enhance water, chemical, and abrasion resistance.
• Also utilized in zirconium metal and chemicals production, refractories, foundry molding sands, and TV screen glass.

Other Products

Financial Performance:

• Revenue: $326 million (-5.5% YoY)
• Key Growth Drivers: Primarily due to a decrease in sales volumes of heavy mineral concentrate tailings.

Product Portfolio:

• High Purity Pig Iron: Co-product from ilmenite smelting, used in foundries for high-quality ductile iron castings.
• Monazite: Rare-earth bearing mineral co-product, with plans for further processing into rare earth oxides (REOs) for electric vehicle motors, wind turbines, and other green economy applications.
• Titanium Tetrachloride (TiCl4): Sold from facilities in Thann, France, and Yanbu, Kingdom of Saudi Arabia, for pigments, catalyst products, and titanium sponge production.

Capital Allocation Strategy

Shareholder Returns:

• Share Repurchases: The Board of Directors authorized the repurchase of up to $300 million of the Company's stock through February 21, 2027. No repurchases were made during the year ended December 31, 2025.
• Dividend Payments: $48 million in 2025. The quarterly dividend was reduced by 60%, effective in the third quarter of 2025.
• Future Capital Return Commitments: A share repurchase program of up to $300 million is authorized through February 21, 2027.

Balance Sheet Position (as of December 31, 2025):

• Cash and Equivalents: $199 million
• Total Debt: $3,204 million
• Net Cash Position: -$3,023 million (Net Debt)
• Credit Rating: Moody’s Ratings: B2 negative outlook (downgraded from Ba3 stable outlook in 2024). S&P Global Ratings: CCC+ negative outlook (downgraded from B positive and stable outlook in 2024).
• Debt Maturity Profile:
  • 2026: $39 million
  • 2027: $37 million
  • 2028: $31 million
  • 2029: $1,833 million
  • 2030: $415 million
  • Thereafter: $859 million

Cash Flow Generation:

• Operating Cash Flow: $60 million

Operational Excellence

Production & Service Model: Tronox Holdings plc operates a vertically integrated model, producing the majority of its internal TiO2 pigment feedstock requirements. Mining of mineral sands deposits is conducted using either "wet" (dredging or hydraulic water jets) or "dry" (earth-moving equipment) methods, depending on ore body characteristics. Wet concentrator plants produce heavy mineral concentrate (90-98% heavy mineral content), which is then separated into non-magnetic (rutile, zircon, monazite) and magnetic (ilmenite) fractions. Ilmenite is further refined into titanium slag (via electric arc furnaces) or synthetic rutile (via rotary kiln reduction and leaching). TiO2 pigment is produced using either the chloride or sulfate process, with approximately 90% of capacity utilizing the chloride process.

Supply Chain Architecture: The Company's production processes are energy and raw material intensive. Key raw materials for chloride TiO2 pigment include titanium feedstock, chlorine, and coke. Other chemicals are sourced via short and long-term contracts. Certain key raw materials are primarily sourced from China. The Company relies on shipping vessels for global transport of raw materials and finished goods. South African operations are dependent on state-owned sole providers for rail (Transnet Freight Rail) and ocean transport (Transnet National Port Authority). KZN Sands operations rely on Sasol Limited for gas supply.

Key Suppliers & Partners:

• Energy/Raw Materials: Eskom (sole electricity supplier in South Africa), Sasol Limited (sole gas supplier for KZN Sands operations), China (source of certain key raw materials).
• Logistics: Transnet Freight Rail and Transnet National Port Authority (sole rail and ocean transport providers in South Africa).
• Technology Partners: Advanced Metal Industries Cluster and Toho Titanium Metal Co. Ltd. ("ATTM") (joint venture adjacent to Yanbu facility, purchases excess TiCl4).
• Rare Earths: Lion Rock Minerals (approximate 5% equity interest, potential source of monazite and rutile).

Facility Network:

• Manufacturing (TiO2 Pigment): Hamilton, Mississippi, United States (225,000 MT, Chloride); Yanbu, Kingdom of Saudi Arabia (200,000 MT, Chloride); Stallingborough, England, United Kingdom (165,000 MT, Chloride); Kwinana, Western Australia (150,000 MT, Chloride); Kemerton, Western Australia (110,000 MT, Chloride); Salvador, Bahia, Brazil (60,000 MT, Sulfate); Thann, Alsace, France (32,000 MT, Sulfate). (Note: Botlek pigment plant in the Netherlands was shut down, Fuzhou pigment plant in China was idled with permanent closure announced in January 2026).
• Mining & Beneficiation: KwaZulu-Natal Sands operations (Fairbreeze mine), Namakwa Sands operations (Namakwa mine) in South Africa; Northern Operations complex (Cooljarloo dredge mine), Eastern Australia operations (Atlas mine), Perth Basin operations (Wonnerup mine) in Australia.
• Smelting/Upgrading: KZN Sands and Namakwa Sands (South Africa) for titanium slag; Chandala metallurgical complex (Western Australia) for synthetic rutile.
• Research & Development: Oklahoma City, Oklahoma, United States; Stallingborough, United Kingdom; Thann, France; Australia; South Africa (with REO focus in Perth, Australia).

Operational Metrics:

• Titanium Feedstock Production Capacity: Approximately 832,000 MT annually (182,000 MT rutile/leucoxene, 240,000 MT synthetic rutile, 410,000 MT titanium slag).
• Co-product Production Capacity: Approximately 297,000 MT of zircon and 250,000 MT of pig iron annually.
• Aggregate Mineral Production (2025): Rutile (161,869 MT), Ilmenite (1,438,287 MT), Zircon (205,915 MT), Heavy Mineral Concentrate (4,093,858 MT).
• Safety (2025): 11 recordable injuries for employees (11 million hours worked) and 16 for contractors (12 million hours worked), with no fatalities.
• Carbon Emissions: Achieved 25% reduction in Scope 1 and Scope 2 emission intensity by end of 2025 (2019 baseline). Targeting 50% reduction by end of 2030 (2019 baseline) and net-zero by 2050. South African solar projects are expected to meet 40% of electricity needs (200 MW project, reducing global Scope 1 and 2 emissions by ~13%) and 70% upon completion of a second large-scale project by end of 2027.

Market Access & Customer Relationships

Go-to-Market Strategy: Tronox Holdings plc employs a dual approach, utilizing both a direct sales force and third-party agents and distributors. This is supported by regional customer service staff and technical service organizations in major geographic markets. The Company has implemented a margin stabilization program and a long-term partnership strategy to enhance product availability, price stability, and customer commitment across all regions and products. The strategy focuses on aligning with high-growth customers and fostering strong relationships through multiple contact points across sales, technical service, marketing, R&D, and senior management.

Customer Portfolio: The Company serves approximately 1,200 customers in about 120 countries. Its top ten third-party customers accounted for 36% of consolidated net sales in 2025, with no single customer representing 10% or more of consolidated net sales. The Company has maintained relationships with its top ten customers for over 10 years.

Geographic Revenue Distribution (2025):

• Europe, Middle-East and Africa: 40.2% of total revenue
• Asia Pacific: 27.3% of total revenue
• North America: 25.8% of total revenue
• South and Central America: 6.7% of total revenue

Competitive Intelligence

Market Structure & Dynamics

Industry Characteristics: The markets for TiO2 pigment and zircon are highly competitive and historically volatile, with demand linked to global, regional, and local GDP and discretionary spending. The TiO2 industry is characterized by excessive production capacity, particularly from Chinese producers who have expanded capacity and increased exports at lower prices. Zircon markets also face weakening demand in China and increased Chinese domestic production and exports at low prices. Demand for many products is subject to seasonal fluctuations, with TiO2 demand increasing prior to the Northern Hemisphere painting season.

Competitive Positioning Matrix:

Direct Competitors

Primary Competitors:

• TiO2: Chemours, LB Group, Kronos Worldwide Inc., INEOS, and numerous regional producers, particularly in Eastern Europe and China. Chinese producers' expanded capacity and aggressive exports at lower prices pose a significant competitive threat.
• Zircon: A large number of mining companies, with competition based on price, quality, logistics, delivery, payment terms, and consistency of supply. Increased Chinese production and exports at lower prices are noted.

Emerging Competitive Threats: New technologies or processes that could replace or offer lower-cost alternatives to the Company's products, or reduce the required TiO2 or zircon content in consumer products.

Competitive Response Strategy: The Company's strategy includes strengthening vertical integration to become a low-cost producer, implementing a Sustainable Cost Improvement Program, and developing its rare earth oxides business. It also focuses on new product commercialization, incorporating sustainable solutions in TiO2 products, transferring technology to optimize its global footprint (e.g., Stallingborough pigment plant), and expanding capabilities at facilities like the Yanbu pigment plant to service broad geographic markets. The Company also uses margin stabilization programs and long-term partnership strategies to manage customer relationships and market dynamics.

Risk Assessment Framework

Strategic & Market Risks

• Market Dynamics: Risk of reduced customer demand for products due to global/regional economic downturns, price volatility for TiO2, zircon, and feedstock. A depressed commodity cycle for TiO2 and weakening demand/increased low-price exports from China for zircon pose significant risks.
• Technology Disruption: Inability to innovate or successfully introduce new products, or the emergence of new technologies/processes that offer lower-cost alternatives or reduce demand for existing products.
• Customer Concentration: While no single customer accounts for 10% of net sales, the top ten customers represent 36% of consolidated net sales, indicating a moderate concentration risk.

Operational & Execution Risks

• Supply Chain Vulnerabilities: Exposure to price increases or supply interruptions for energy (e.g., electricity from Eskom in South Africa, gas from Sasol Limited for KZN Sands operations), other raw materials (some primarily sourced from China), and shipping vessels. Geopolitical conflicts (Russia/Ukraine, Middle East) can exacerbate energy and raw material supply uncertainty.
• Geographic Concentration: Significant mining and beneficiation operations in South Africa expose the Company to operational risks including unreliable electricity supply, increased electricity prices, and chronic operational/financial challenges with state-owned rail (Transnet Freight Rail) and port (Transnet National Port Authority) services, leading to shipment delays and increased costs. Operations in the Kingdom of Saudi Arabia are exposed to political, social, and economic instability in the Middle East region, including potential disruptions to shipping routes in the Red Sea.
• Capacity Constraints: Risk of production delays, shutdowns, or increased expenditures due to industrial accidents, equipment failures, or asset deterioration. Mineral reserve estimates are based on assumptions, and actual production may differ, requiring continuous exploration or discovery for additional reserves.

Financial & Regulatory Risks

• Demand Volatility: Products are subject to seasonal fluctuations (e.g., TiO2 for paint in Northern Hemisphere spring/summer) and economic sensitivity, leading to variations in product margins and profitability.
• Foreign Exchange: Exposure to fluctuations in currency exchange rates, particularly the South African Rand, Australian Dollar, Euro, and Pound Sterling against the U.S. dollar, impacting reported sales and operating margins.
• Credit & Liquidity: Potential difficulty in obtaining additional capital on favorable terms due to debt covenants, increasing interest rates on floating-rate debt, demands for financial assurance, and credit rating downgrades (Moody’s: B2 negative; S&P Global Ratings: CCC+ negative in 2025). High indebtedness could limit cash available for operations, capital expenditures, and shareholder returns.
• Regulatory & Compliance Risks: Extensive environmental, health, and safety regulations in operating jurisdictions (e.g., South Africa, Australia), including mine rehabilitation, water management, and hazardous materials. Onerous regulatory requirements in South Africa (e.g., Black Economic Empowerment legislation, land expropriation risks). Increased regulatory scrutiny on TiO2 products (e.g., U.K. classification as suspected carcinogen, EU Food Safety Authority guidelines on E171) could limit usage or increase costs. Greenhouse gas regulations could increase energy/raw material costs and compliance expenditures. Failure to comply with anti-corruption laws (FCPA, U.K. Bribery Act) and potential litigation (e.g., class action lawsuit regarding financial outlook and product demand, claims from pre-bankruptcy activities).

Geopolitical & External Risks

• Geopolitical Exposure: Risks from operating a global business, including political instability, civil unrest, and hostilities in regions of operation (e.g., South Africa, Middle East).
• Trade Relations: Impact of anti-dumping duties on Chinese TiO2 imports (EU, Brazil, Kingdom of Saudi Arabia, India) and U.S. Section 301 Duties (25% on Chinese-origin TiO2). Changes to these duties could adversely affect financial results.
• Extreme Weather: Physical risks to facilities and supply chain disruptions from natural disasters and extreme weather conditions (e.g., flooding in New South Wales, Australia, water scarcity/drought in South Africa).

Innovation & Technology Leadership

Research & Development Focus: The Company's R&D efforts are concentrated on developing new products, servicing existing products, and applied research for new and existing processes.

• Core Technology Areas: Focus on increasing throughput, efficiency gains, and general processing improvements for customers. Ongoing development of process technology aims for cost reduction, enhanced production flexibility, increased capacity, and improved product quality.
• Innovation Pipeline: Commercialized new products for masterbatch and engineering resin markets in 2025. Continued focus on sustainable solutions in TiO2 products through organic substitutions. Successfully transferred technology to the Stallingborough pigment plant to support durable plastic pigment applications. Expanded product capabilities at the Yanbu pigment plant to service broader geographic markets.
• Rare Earth Initiatives: R&D supports rare earth initiatives, including improvements in raw material characterization and transformation. A pre-feasibility study for a rare earth "cracking and leaching" facility was completed in 2025, with further development planned for 2026. Process technology research is dedicated to the concentration and separation of monazite into neodymium, praseodymium, terbium, and dysprosium for EV and wind turbine applications.

Intellectual Property Portfolio:

• Patent Strategy: As of December 31, 2025, the Company held 67 U.S. patents and 3 U.S. patent applications, along with approximately 470 foreign counterparts, with U.S. patent expiration dates extending through 2043. The majority of patents and trade secrets relate to chloride products, surface treatments, chlorination expertise, and oxidation process technology.
• Trademarks: 11 U.S. trademark registrations, 3 U.S. trademark applications, and 316 foreign trademark counterpart registrations and applications, including TIONA® and CristalActiv®.
• Trade Secrets: Relies on unpatented proprietary technology, know-how, and other trade secrets, with operational knowledge considered more important than patent protection for fundamental intellectual property.
• Licensing Programs: Holds a non-exclusive, perpetual license from Anglo American South Africa Limited for smelting technology at Namakwa Sands.
• IP Litigation: No material pending or threatened proceedings related to alleged infringement of intellectual property rights of others.

Technology Partnerships: The Company engages in strategic alliances and research collaborations, including a joint venture with Advanced Metal Industries Cluster and Toho Titanium Metal Co. Ltd. ("ATTM") for titanium sponge production, which purchases TiCl4 from the Company.

Leadership & Governance

Executive Leadership Team (as of February 20, 2026)

Leadership Continuity: The Company maintains a rigorous succession planning process for key positions, focusing on developing future talent and ensuring agility in leadership changes.

Board Composition: The Board of Directors includes Ilan Kaufthal (Chairman), Peter B. Johnston, Ginger M. Jones, Stephen Jones, Moazzam Khan, Sipho Nkosi, Lucrece Foufopolous-De Ridder, John Romano, and Jean-Francois Turgeon. Moazzam Khan is noted as Managing Director of Cristal International Holdings B.V. The Board provides oversight of cybersecurity policies and risk management, with detailed updates provided to the Audit Committee.

Human Capital Strategy

Workforce Composition: Tronox Holdings plc employs approximately 5,700 people across six continents. The workforce requires specialized skills in both mining and TiO2 pigment manufacturing, with an emphasis on cross-functional learning to leverage the integrated model.

Talent Management:

• Acquisition & Retention: The Company prioritizes knowledge transfer through relocating skilled leaders, staffing high-potential employees on global projects, and fostering collaboration in global centers of excellence.
• Employee Value Proposition: Committed to creating a diverse workforce where employees feel valued, respected, and have access to opportunities. Efforts in 2025 focused on inclusion through learning opportunities, employee surveys, promoting women in STEM, and celebrating diverse cultures.

Diversity & Development:

• Development Programs: A "Living our Values" program is expected to launch in 2026 to foster a high-performance culture and a "Growth Mindset." A rigorous succession planning process identifies high-potential leaders and develops individualized plans.
• Culture & Engagement: The Company emphasizes an uncompromising focus on safety, reliability, and responsible operations, measuring progress with safety metrics and leading indicators. A code of conduct and business ethics guides employees, with annual global training.

Environmental & Social Impact

Environmental Commitments:

• Climate Strategy: The Company has a detailed roadmap for reducing carbon emissions. It achieved its target of a 25% reduction in Scope 1 and Scope 2 emission intensity by the end of 2025 (against a 2019 baseline). It is actively pursuing a 50% reduction target by the end of 2030 (2019 baseline) and a long-term goal of "net zero" carbon emissions by 2050.
• Renewable Energy: A 200 MW solar energy project in South Africa, fully operational in 2025, contributes approximately 40% of the Company's South African electricity needs and is expected to reduce global Scope 1 and 2 emissions by about 13%. A second large-scale renewable energy project in South Africa is expected to be fully operational by the end of 2027, aiming to satisfy approximately 70% of South African electricity needs from renewable sources.

Social Impact Initiatives:

• Product Impact: The Company's monazite co-product contains rare earth elements, recognized as critical minerals for the energy transition and decarbonization, essential for electric vehicle motors and wind turbines.
• Workplace: Commitment to providing a safe, diverse workplace and opportunities for employee growth and development, underpinned by an uncompromising focus on operating safe, reliable, and responsible facilities.

Business Cyclicality & Seasonality

Demand Patterns:

• Seasonal Trends: Demand for the Company's products is subject to seasonal fluctuations. TiO2 demand typically increases before the Northern Hemisphere's spring and summer painting season. Zircon demand is negatively impacted by winter and Chinese New Year celebrations due to reduced demand from China.
• Economic Sensitivity: Product demand and margins are historically linked to global, regional, and local GDP and discretionary spending, making them sensitive to economic conditions and business cycles. The Company has recently experienced a depressed trend in the commodity cycle for TiO2.

Planning & Forecasting: The Company's management reviews monthly production figures and future global sales demand forecasts to make decisions about ongoing production levels and resource allocation, indicating active planning and forecasting to manage these patterns.

Regulatory Environment & Compliance

Regulatory Framework: The Company's operations are subject to extensive international, federal, state, and local environmental, health, and safety laws and regulations across numerous jurisdictions. These include regulations concerning natural resource use, pollution, environmental protection, mine site remediation, waste management, and occupational health and safety.

• Industry-Specific Regulations: South African mining operations are governed by the Mineral and Petroleum Resources Development Act and the Mine Health and Safety Act, requiring regular reporting and compliance with environmental standards. Australian operations are regulated by state-level mining acts.
• Chemical Registration: Compliance with chemical substance and inventory regulations such as the Toxic Substances Control Act in the United States and the Registration, Evaluation and Authorization of Chemicals (“REACH”) in Europe, as well as analogous regimes in China, South Korea, and Taiwan.
• TiO2 Product Scrutiny: TiO2 products face increased regulatory scrutiny, including the U.K.'s classification of TiO2 as a suspected carcinogen (in powder form) and the European Food Safety Authority's (EFSA) new guidelines on E171 (a digestible form of TiO2) as a food additive. These could lead to more stringent regulations, use restrictions, or increased compliance costs.
• Greenhouse Gas Regulation: Operations are subject to regulations aimed at reducing GHG emissions, with reporting and management requirements in jurisdictions like the European Union, United Kingdom, and Australia. New laws or regulations could increase raw material costs, operational costs, or administrative expenses.

Trade & Export Controls:

• Export Restrictions: Potential impact from export restrictions or limits imposed by the Chinese government on certain key raw materials sourced from China.
• Anti-dumping Duties: Definitive anti-dumping duties have been imposed on Chinese TiO2 imports by the European Commission, Brazil, and the Kingdom of Saudi Arabia, with India's duties currently stayed. The U.S. also imposes 25% Section 301 Duties on Chinese-origin TiO2 products. The efficacy and continuity of these duties are subject to review and potential changes.

Legal Proceedings: A putative class action lawsuit was filed in the U.S. District Court for the District of Connecticut on September 3, 2025, alleging violations of U.S. federal securities laws related to the Company's financial outlook and product demand statements between February 12, 2025, and July 30, 2025. The Company intends to vigorously defend against this lawsuit. The Company may also be subject to claims arising from activities prior to its emergence from bankruptcy in 2011.

Tax Strategy & Considerations

Tax Profile: The Company's effective tax rate was (3)% in 2025, influenced by income and losses in jurisdictions with valuation allowances, non-taxable items, withholding taxes, prior year accruals, and jurisdictional mix of income. The U.K. statutory tax rate was 25% at December 31, 2025.

• Geographic Tax Planning: The Company asserts that $720 million in undistributed earnings from foreign subsidiaries are indefinitely reinvested outside the parent's taxing jurisdictions, with no provision for withholding tax on these amounts. However, the assertion for China's earnings has been removed, and withholding tax accruals for potential repatriations are now reflected.
• Tax Reform Impact: The new U.S. tax law, "One Big Beautiful Bill," signed on July 4, 2025, is not expected to have a material impact on U.S. entities. The implementation of OECD Pillar Two and Domestic Minimum Taxes in various jurisdictions, effective 2024, did not impact the Company's income tax provisions for 2025.
• Tax Attributes: The Company has approximately $4.3 billion in net operating losses (NOLs) and $370 million in Section 163(j) interest expense carryforwards. The ability to utilize these attributes could be limited by an "ownership change" under U.S. tax law.
• Tax Audits: The Company is currently under audit by the Australian Taxation Office for calendar years 2019-2022.

Insurance & Risk Transfer

Risk Management Framework: The Company is self-insured for certain levels of general and vehicle liability, property, workers’ compensation, and health care coverage. It periodically evaluates cyber insurance coverage but does not currently carry it.

• Risk Transfer Mechanisms: The Company utilizes derivative instruments, such as interest rate swaps and foreign currency contracts, as economic hedges to manage exposure to fluctuations in interest rates and foreign exchange rates. As of December 31, 2025, the Company maintained $950 million in interest rate swaps.