2016 Q2 Form 10-Q Financial Statement

#000162722316000139 Filed on August 09, 2016

View on sec.gov

Income Statement

Concept 2016 Q2 2015 Q4 2015 Q2
Revenue $1.383B $1.360B $1.508B
YoY Change -8.29% -12.2% -10.45%
Cost Of Revenue $1.116B $1.147B $1.282B
YoY Change -12.95% -8.09% -2.21%
Gross Profit $267.0M $213.0M $226.0M
YoY Change 18.14% -29.24% -39.08%
Gross Profit Margin 19.31% 15.66% 14.99%
Selling, General & Admin $174.0M $151.0M $157.0M
YoY Change 10.83% -1.31% -14.21%
% of Gross Profit 65.17% 70.89% 69.47%
Research & Development $17.00M $29.00M $27.00M
YoY Change -37.04% -12.12% -32.5%
% of Gross Profit 6.37% 13.62% 11.95%
Depreciation & Amortization $73.00M $66.00M $67.00M
YoY Change 8.96% -8.33% 4.69%
% of Gross Profit 27.34% 30.99% 29.65%
Operating Expenses $191.0M $180.0M $184.0M
YoY Change 3.8% -3.23% -17.49%
Operating Profit $76.00M $33.00M $42.00M
YoY Change 80.95% -71.3% -71.62%
Interest Expense $50.00M -$77.00M $28.00M
YoY Change 78.57% 120.0%
% of Operating Profit 65.79% -233.33% 66.67%
Other Income/Expense, Net -$4.000M $20.00M $2.000M
YoY Change -300.0% 66.67% -66.67%
Pretax Income -$41.00M -$121.0M -$18.00M
YoY Change 127.78% -200.83% -111.61%
Income Tax -$23.00M -$35.00M $0.00
% Of Pretax Income
Net Earnings -$18.00M -$86.00M -$18.00M
YoY Change 0.0% -208.86% -115.52%
Net Earnings / Revenue -1.3% -6.32% -1.19%
Basic Earnings Per Share -$0.10 -$0.48 -$0.10
Diluted Earnings Per Share -$0.10 -$0.48 -$0.10
COMMON SHARES
Basic Shares Outstanding 181.5M 181.0M shares 181.0M shares
Diluted Shares Outstanding 181.5M 181.0M shares

Balance Sheet

Concept 2016 Q2 2015 Q4 2015 Q2
SHORT-TERM ASSETS
Cash & Short-Term Investments $383.0M $366.0M $247.0M
YoY Change 55.06%
Cash & Equivalents $383.0M $366.0M $247.0M
Short-Term Investments
Other Short-Term Assets $80.00M $106.0M $158.0M
YoY Change -49.37% 146.51%
Inventory $892.0M $972.0M $1.054B
Prepaid Expenses $104.0M $105.0M
Receivables $849.0M $757.0M $896.0M
Other Receivables $16.00M $19.00M $128.0M
Total Short-Term Assets $2.292B $2.301B $2.483B
YoY Change -7.69% 18.55%
LONG-TERM ASSETS
Property, Plant & Equipment $2.890B $3.177B $3.378B
YoY Change -14.45% -3.96%
Goodwill $153.0M $166.0M $196.0M
YoY Change -21.94% -16.16%
Intangibles $8.000M $10.00M $12.00M
YoY Change -33.33% -9.09%
Long-Term Investments $157.0M $136.0M $145.0M
YoY Change 8.28% 9.68%
Other Assets $369.0M $508.0M $471.0M
YoY Change -21.66% 34.75%
Total Long-Term Assets $3.929B $3.997B $4.202B
YoY Change -6.5% -0.52%
TOTAL ASSETS
Total Short-Term Assets $2.292B $2.301B $2.483B
Total Long-Term Assets $3.929B $3.997B $4.202B
Total Assets $6.221B $6.298B $6.685B
YoY Change -6.94% 5.69%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $875.0M $973.0M $919.0M
YoY Change -4.79% -6.98%
Accrued Expenses $533.0M $454.0M $380.0M
YoY Change 40.26% 28.98%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due $36.00M $39.00M $16.00M
YoY Change 125.0%
Total Short-Term Liabilities $1.444B $1.466B $1.441B
YoY Change 0.21% 4.86%
LONG-TERM LIABILITIES
Long-Term Debt $3.823B $3.915B $3.927B
YoY Change -2.65%
Other Long-Term Liabilities $583.0M $553.0M $485.0M
YoY Change 20.21% 19.18%
Total Long-Term Liabilities $4.406B $4.468B $4.412B
YoY Change -0.14% 862.93%
TOTAL LIABILITIES
Total Short-Term Liabilities $1.444B $1.466B $1.441B
Total Long-Term Liabilities $4.406B $4.468B $4.412B
Total Liabilities $6.052B $6.168B $6.280B
YoY Change -3.63% 169.82%
SHAREHOLDERS EQUITY
Retained Earnings -$82.00M -$115.0M
YoY Change
Common Stock $2.000M $2.000M
YoY Change
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $165.0M $126.0M $401.0M
YoY Change
Total Liabilities & Shareholders Equity $6.221B $6.298B $6.685B
YoY Change -6.94% 5.69%

Cashflow Statement

Concept 2016 Q2 2015 Q4 2015 Q2
OPERATING ACTIVITIES
Net Income -$18.00M -$86.00M -$18.00M
YoY Change 0.0% -208.86% -115.52%
Depreciation, Depletion And Amortization $73.00M $66.00M $67.00M
YoY Change 8.96% -8.33% 4.69%
Cash From Operating Activities $90.00M $302.0M $5.000M
YoY Change 1700.0% -38.62% -88.89%
INVESTING ACTIVITIES
Capital Expenditures -$79.00M -$127.0M -$150.0M
YoY Change -47.33% -36.5% 50.0%
Acquisitions
YoY Change
Other Investing Activities $11.00M -$15.00M -$14.00M
YoY Change -178.57% -188.24% -153.85%
Cash From Investing Activities -$68.00M -$142.0M -$164.0M
YoY Change -58.54% -22.4% 121.62%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -92.00M -8.000M 406.0M
YoY Change -122.66% -97.41% 1300.0%
NET CHANGE
Cash From Operating Activities 90.00M 302.0M 5.000M
Cash From Investing Activities -68.00M -142.0M -164.0M
Cash From Financing Activities -92.00M -8.000M 406.0M
Net Change In Cash -70.00M 152.0M 247.0M
YoY Change -128.34%
FREE CASH FLOW
Cash From Operating Activities $90.00M $302.0M $5.000M
Capital Expenditures -$79.00M -$127.0M -$150.0M
Free Cash Flow $169.0M $429.0M $155.0M
YoY Change 9.03% -38.01% 6.9%

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us-gaap Other Comprehensive Income Defined Benefit Plans Net Unamortized Gain Loss Arising During Period Tax
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us-gaap Other Comprehensive Income Defined Benefit Plans Net Unamortized Gain Loss Arising During Period Tax
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us-gaap Other Comprehensive Income Loss Amortization Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Prior Service Cost Credit Before Tax
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us-gaap Other Comprehensive Income Loss Amortization Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Prior Service Cost Credit Before Tax
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us-gaap Other Comprehensive Income Loss Amortization Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Prior Service Cost Credit Net Of Tax
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CY2016Q2 us-gaap Other Comprehensive Income Loss Amortization Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Prior Service Cost Credit Net Of Tax
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us-gaap Other Comprehensive Income Loss Amortization Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Prior Service Cost Credit Net Of Tax
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us-gaap Other Comprehensive Income Loss Amortization Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Prior Service Cost Credit Tax
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CY2016Q2 us-gaap Other Comprehensive Income Loss Amortization Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Prior Service Cost Credit Tax
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us-gaap Other Comprehensive Income Loss Amortization Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Prior Service Cost Credit Tax
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us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
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us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Before Tax
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us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Before Tax
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us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Net Of Tax
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us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Net Of Tax
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us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Tax
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us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Tax
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us-gaap Other Comprehensive Income Loss Tax
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us-gaap Other Comprehensive Income Unrealized Gain Loss On Derivatives Arising During Period Net Of Tax
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us-gaap Other Comprehensive Income Unrealized Gain Loss On Derivatives Arising During Period Net Of Tax
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0 USD
us-gaap Other Comprehensive Income Unrealized Gain Loss On Derivatives Arising During Period Tax
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CY2016Q2 us-gaap Other Comprehensive Income Unrealized Gain Loss On Derivatives Arising During Period Tax
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us-gaap Other Comprehensive Income Unrealized Gain Loss On Derivatives Arising During Period Tax
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us-gaap Payments For Proceeds From Derivative Instrument Investing Activities
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us-gaap Payments For Restructuring
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us-gaap Payments To Acquire Equity Method Investments
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us-gaap Payments To Acquire Property Plant And Equipment
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287000000 USD
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us-gaap Pension And Other Postretirement Benefit Expense
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us-gaap Proceeds From Issuance Of Long Term Debt
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3490000000 USD
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us-gaap Profit Loss
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us-gaap Profit Loss
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us-gaap Provision For Doubtful Accounts
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us-gaap Provision For Doubtful Accounts
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us-gaap Repayments Of Long Term Debt
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us-gaap Research And Development Expense
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us-gaap Royalty Revenue
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us-gaap Royalty Revenue
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us-gaap Sales Revenue Net
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us-gaap Sales Revenue Net
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us-gaap Selling General And Administrative Expense
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us-gaap Severance Costs1
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CY2016Q2 us-gaap Severance Costs1
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us-gaap Severance Costs1
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CY2015Q2 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Grants In Period Gross
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us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Grants In Period Gross
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CY2015Q3 us-gaap Stock Issued During Period Shares New Issues
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CY2015Q4 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
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130000000 USD
CY2016Q2 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
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CY2016Q2 us-gaap Translation Adjustment For Net Investment Hedge Increase Decrease Net Of Tax
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us-gaap Translation Adjustment For Net Investment Hedge Increase Decrease Net Of Tax
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us-gaap Weighted Average Number Of Diluted Shares Outstanding
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180966833 shares
CY2016Q2 us-gaap Weighted Average Number Of Diluted Shares Outstanding
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181477672 shares
us-gaap Weighted Average Number Of Diluted Shares Outstanding
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CY2015Q2 us-gaap Weighted Average Number Of Shares Outstanding Basic
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180966833 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
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180966833 shares
CY2016Q2 us-gaap Weighted Average Number Of Shares Outstanding Basic
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181477672 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
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us-gaap Basis Of Accounting
BasisOfAccounting
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-bottom:12px;padding-top:12px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Basis of Presentation</font></div><div style="line-height:120%;padding-bottom:12px;padding-top:12px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The accompanying interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (GAAP) for interim financial information. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair statement of the results for interim periods have been included. Results for interim periods should not be considered indicative of results for a full year and the year-end consolidated balance sheet does not include all disclosures required by accounting principles generally accepted in the United States of America. As such, these interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2015. Unless otherwise stated, references to years and </font><font style="font-family:inherit;font-size:10pt;">three and six</font><font style="font-family:inherit;font-size:10pt;"> month periods relate to Chemours' fiscal years and </font><font style="font-family:inherit;font-size:10pt;">three and six</font><font style="font-family:inherit;font-size:10pt;"> month periods. Certain reclassifications of prior year's data have been made to conform to current period presentation.</font></div><div style="line-height:120%;padding-bottom:12px;padding-top:12px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Chemours did not operate as a separate, stand-alone entity for the full period covered by the 2015 interim consolidated financial statements. Prior to our separation on July 1, 2015, Chemours operations were included in DuPont's financial results in different legal forms, including but not limited to wholly-owned subsidiaries for which Chemours was the sole business, components of legal entities in which Chemours operated in conjunction with other DuPont businesses and a majority owned joint venture. For periods prior to July 1, 2015, the interim consolidated financial statements have been prepared from DuPont&#8217;s historical accounting records and are presented on a stand-alone basis as if the business operations had been conducted independently from DuPont. DuPont and its subsidiaries&#8217; net investments in these operations are shown in lieu of Stockholder&#8217;s Equity in the interim consolidated financial statements for the period ended </font><font style="font-family:inherit;font-size:10pt;">June&#160;30, 2015</font><font style="font-family:inherit;font-size:10pt;">. The interim consolidated financial statements for the period ended </font><font style="font-family:inherit;font-size:10pt;">June&#160;30, 2015</font><font style="font-family:inherit;font-size:10pt;"> include the historical operations, assets and liabilities of the legal entities that were considered to comprise the Chemours business, including certain environmental remediation and litigation obligations for which Chemours has indemnified DuPont. </font></div><div style="line-height:120%;padding-bottom:12px;padding-top:12px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">All of the allocations and estimates in the interim consolidated financial statements prior to July 1, 2015 were based on assumptions that management believes are reasonable. However, the interim consolidated financial statements for the three and six months ended </font><font style="font-family:inherit;font-size:10pt;">June&#160;30, 2015</font><font style="font-family:inherit;font-size:10pt;"> included herein may not be indicative of the results of operations and cash flows of Chemours in the future or if Chemours had been a separate, stand-alone entity during those periods. </font></div><div style="line-height:120%;padding-bottom:12px;padding-top:12px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The net transfers from DuPont in the Interim Consolidated Statements of Stockholders&#8217; Equity for the six months ended </font><font style="font-family:inherit;font-size:10pt;">June&#160;30, 2015</font><font style="font-family:inherit;font-size:10pt;"> include a non-cash contribution from DuPont of </font><font style="font-family:inherit;font-size:10pt;">$93</font><font style="font-family:inherit;font-size:10pt;">. This non-cash contribution occurred during physical separation activities at shared production facilities in the United States prior to the separation.</font></div></div>
us-gaap Nature Of Operations
NatureOfOperations
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-bottom:12px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Background and Description of the Business</font></div><div style="line-height:120%;padding-bottom:12px;padding-top:12px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Chemours Company (Chemours or the Company) delivers customized solutions with a wide range of industrial and specialty chemical products for markets including plastics and coatings, refrigeration and air conditioning, general industrial, mining and oil refining. Principal products include titanium dioxide (TiO</font><font style="font-family:inherit;font-size:10pt;"><sub style="vertical-align:bottom;line-height:120%;font-size:7pt">2</sub></font><font style="font-family:inherit;font-size:10pt;">), refrigerants, industrial fluoropolymer resins, sodium cyanide and sulfuric acid. Chemours consists of </font><font style="font-family:inherit;font-size:10pt;">three</font><font style="font-family:inherit;font-size:10pt;"> reportable segments: Titanium Technologies, Fluoroproducts and Chemical Solutions.</font></div><div style="line-height:120%;padding-bottom:12px;padding-top:12px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Chemours is globally operated with manufacturing facilities, sales centers, administrative offices and warehouses located throughout the world. Chemours' operations are primarily located in the United States (U.S.), Canada, Mexico, Brazil, the Netherlands, Belgium, China, Taiwan, Japan, Switzerland, Singapore, Hong Kong, India, the United Kingdom and France. As of </font><font style="font-family:inherit;font-size:10pt;">June&#160;30, 2016</font><font style="font-family:inherit;font-size:10pt;">, Chemours consists of </font><font style="font-family:inherit;font-size:10pt;">34</font><font style="font-family:inherit;font-size:10pt;"> production facilities globally, </font><font style="font-family:inherit;font-size:10pt;">five</font><font style="font-family:inherit;font-size:10pt;"> dedicated to Titanium Technologies, </font><font style="font-family:inherit;font-size:10pt;">16</font><font style="font-family:inherit;font-size:10pt;"> dedicated to Fluoroproducts, </font><font style="font-family:inherit;font-size:10pt;">12</font><font style="font-family:inherit;font-size:10pt;"> dedicated to Chemical Solutions (which includes </font><font style="font-family:inherit;font-size:10pt;">nine</font><font style="font-family:inherit;font-size:10pt;"> production facilities of the Clean &amp; Disinfect and Sulfur businesses classified as held-for-sale, see Note 6) and </font><font style="font-family:inherit;font-size:10pt;">one</font><font style="font-family:inherit;font-size:10pt;"> that supports the Fluoroproducts and Chemical Solutions segments. </font></div><div style="line-height:120%;padding-bottom:12px;padding-top:12px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Effective prior to the opening of trading on the New York Stock Exchange (NYSE) on July 1, 2015 (the Distribution Date), E. I. du Pont de Nemours and Company (DuPont) completed the previously announced separation of the businesses comprising DuPont&#8217;s Performance Chemicals reporting segment, and certain other assets and liabilities, into Chemours, a separate and distinct public company. The separation was completed by way of a distribution of all of the then-outstanding shares of common stock of Chemours through a dividend in kind of Chemours&#8217; common stock (par value </font><font style="font-family:inherit;font-size:10pt;">$0.01</font><font style="font-family:inherit;font-size:10pt;">) to holders of DuPont common stock (par value </font><font style="font-family:inherit;font-size:10pt;">$0.30</font><font style="font-family:inherit;font-size:10pt;">) as of the close of business on June 23, 2015 (the Record Date) (the transaction referred to herein as the Distribution). </font></div><div style="line-height:120%;padding-bottom:12px;padding-top:12px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On the Distribution Date, each holder of DuPont's common stock received one share of Chemours' common stock for every five shares of DuPont's common stock held on the Record Date. The separation was completed pursuant to a Separation Agreement and other agreements with DuPont related to the separation, including an Employee Matters Agreement, a Tax Matters Agreement, a Transition Services Agreement and an Intellectual Property Cross-License Agreement. These agreements govern the relationship between Chemours and DuPont following the separation and provided for the allocation of various assets, liabilities, rights and obligations. These agreements also include arrangements for transition services to be provided by DuPont to Chemours. </font></div><div style="line-height:120%;padding-bottom:12px;padding-top:12px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Unless the context otherwise requires, references in these Notes to the Consolidated Financial Statements to &#8220;we,&#8221; &#8220;us,&#8221; &#8220;our,&#8221; &#8220;Chemours&#8221; and the &#8220;Company&#8221; refer to The Chemours Company and its consolidated subsidiaries after giving effect to the Distribution.</font></div></div>

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