Tronox (NYSE:TROX) -4.1% pre-market on Monday, threatening to drop to a new 52-week low, after lowering guidance for Q3 adjusted EBITDA, citing softer than expected sales volume of titanium dioxide pigment, citing softer than anticipated TiO2 sales volumes and rising energy costs in Europe.
The company said it now expects Q3 adjusted EBITDA of $240M-$255M, down from previous guidance of $275M-$295M.
Tronox (TROX) said demand in Europe, the Middle East, Africa and Asia Pacific has been significantly softer than expected since July, while orders in North America and Latin America have remained relatively in line with expectations, co-CEO John Romano said.
The company also noted the continuing rise in natural gas prices throughout Europe, resulting in increased energy costs at its U.K. operations and energy surcharges on process chemicals at its European sites.
Citing falling prices for titanium dioxide and higher energy costs, BMO Capital downgraded Tronox last week to Market Perform from Outperform.