Chemours
stock plummeted Thursday after the company said accounting issues would delay its fourth-quarter earnings report and that its board has placed both its CEO and CFO on administrative leave.
Shares of Chemours—once part of
DuPont de Nemours
and maker of paint additives among other products—crumbled 41% to $16.94 apiece in recent Thursday trading. The
S&P 500
was up 0.2%, and the
Dow Jones Industrial Average
was down 0.2%, in comparison.
Chemours said Thursday that its board had put CEO Mark Newman and CFO Jonathan Lock, along with controller and principal accounting officer Camela Wisel, on administrative leave as the company conducts an internal review of its accounting practices. The company didn’t immediately respond to a request for comment.
“Leave is pending the completion of an internal review being overseen by the Audit Committee of the Board of Directors with the assistance of independent outside counsel,” the company said in a news release. The scope of the review includes Chemours’ practices for managing working capital, incentive plans, and adjusted financial metrics. Working capital includes things such as inventories, accounts receivable, and payable and can impact cash flow.
“As a result, the Company is evaluating one or more potential material weaknesses in its internal control over financial reporting as of December 31, 2023.”
The accounting issues will also delay fourth-quarter earnings and the company’s annual report, the release said. The update is a blow for investors, as the stock was already down 18% over the past 12 months going into Thursday trading.
The company said it has appointed Denise Dignam—who had previously led its Titanium Technologies and Advanced Performance Materials businesses—as interim CEO. Meanwhile it named Matt Abbott—who has served as senior vice president and chief enterprise transformation officer—as interim CFO as well as principal financial and accounting officer.
“We are fortunate to have two very experienced and capable leaders in our ranks to step up and fill these roles,” said Chemour’s board chair, Dawn Farrell, in the release.
Titanium Technologies makes titanium dioxide—a paint ingredient that makes paint white, bright, and helps it cover surfaces. The Advanced Materials segment makes many products, including Teflon. Combined, the two segments made up more than 68% of the company’s net sales last year, according to the news release.
Chemours added in its news release that sales for 2023 were roughly $6 billion—in line with Wall Street estimates.
The company ended the year with about $1.2 billion in cash, including $600 million in restricted cash related to water settlements for cleaning up a group of chemicals known as PFAS.
Write to Al Root at [email protected]
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