You're listening to Taking Stock on Bluebird Radio. In July of twenty fifteen that Kemore's a Company or KEM Wres was spun off from DuPont and here to tell us more about the company and its business is Mark Vergnano. He is the chief executive of KEM Wars. Thanks very much for coming into the studio. Great to be here. Let's talk, or rather you talk and you describe the three main business lines at KEM war so people understand
what it is the company is focused on. Well, as you said, you know, we spun out last July from DuPont and what we like to tell people is where we're a startup, but we sort of had a two hundred year head started from that standpoint. So you know, three product lines that came outside of UH came out of DuPont. One was our TiO two business, titanium dioxide used in paints, plastics, even used in your toothpaste in
the morning, anything to make white. Um are floor products business, which is both the polymer side Teflon as a brand that many people know, as well as our refrigerants free On what might be a refrigerant many people remember, but our brand new refrigerant optition which has low global warming potential UM. And we have a chemical solutions business, which UH really is about mining chemicals primarily. Is the is the third leg of our business. I just want to
touch on the fact. First of all, your background. You're a real chemist, aren't you? Chemical engineer? Well? There you go, But so what was what was your kind of path from being a chemical engineer to now running this very exciting CEO slash startup. Yeah, so I I came out of the University of Connecticut and not that far away UH and came into DuPont thirty five years ago and UH started right away there, ended up getting my MBA while I was there, but progressively just took different roles
in different jobs. Started in the lab, started doing a process development, and then eventually running business. Does it help to be someone with a real chemical background to run a company like this, I think well. I always would always tell people it's great to have an engineering background just from a logic flow, you know, you you sort of think of things logically. I think it helps. But a company like DuPont and now a company like Comor's chemistry is really what we are right, We are a
chemistry company. So from that standard's absolutely very helpful in terms of the background for the company. Now, I gotta ask you this question, because you were, as you just describe, spun out of DuPont and there are legacy legal issues that exist. Can you shed any light on responsibility where they stand and you know what you believe is going to happen. Yeah, what I would say is when we were spun out of DuPont, we we were spun out with a variety of things, three fantastic businesses that we
talked about. UM. We were given a large amount of debt, about four billion dollars a debt, and we had some legacy liabilities that came over with us UM. I think people were a little bit nervous about that, about the debt and the and the legacy liabilities in the beginning, and as you might have seen, our stock was sort of bouncy in the beginning. But that's a nice that's
a nice way to do. I mean, just just to mention in detail, right, this has to do with the Washington Works plant I believe in uh Parkersburg, West Virginia, right, And I had to do with the chemical used to make teflon in manufact that's right, and so that that liability still exists now it does live with DuPont, but uh, you know it is connected back uh to us through
an indemnity. But I think what the reason the stock was so volatile in the beginning is people weren't sure what would this company be able to handle whatever came back from the liabilities as well as the dead And I think what we've shown is, you know we are We put together right away a five point transformation plan.
You know, that plan was about taking costs down, focusing our businesses on the three that we talked about, really channeling our investments, UM, divesting in businesses that weren't our core, which we've delivered about seven million of cash from that standpoint, and really working on a enhancing our organization. As we've been successful in taking the cost out and successful and and uh shedding those businesses and taking the cash that
can be aimed down to bring our debt down. I think people have gained lots more confidence in this company. So I think a lot of those issues now are getting lesser and lesser in the minds of our investors, and that's why we're up stock price. So what drives demand for your products. And of course one of the big ones you say that the the titanium dioxide which is in so many things including two paste. Uh. Is it global growth? Is it certain kinds of new business
is being formed? Is it what happens in China? What? What? What is going to determine what kind of year you have? Say so, t I O two traditionally is a GDP growth business, So it's going to grow at GDP around the world. So whether you think of that at two and a half or three percent today, that's the kind of growth rate. It's almost a perfect correlation. But the way you exceed that kind of growth is by bringing
in new products. So, for instance, we have a brand new T O two product that we call Type here one coat. It allows paint manufacturers to manufacture a paint that you and I can apply in one coat. So it's enhances because it has the hide ability, it has the opacity that you need if you're going to paint in just one brushstroke. Now you and I both know, we both I'm sure painted rooms before, and it's torture when you have to do it with multiple codes. So if you can do it in one it's really a
lot of ease. So those types of things, whether it's in our TIL two business or floor products business with our refrigerat optition new products are really what we're going to drive our growth rate beyond what GDP would be. So just quick fun question, how much you're spending on R and D. R and D for us is about two to three percent of our revenue. Um it's it's you know, aimed a little bit differently around those three bills, but it's about two to three. Okay, Well, he's he's committed.
He's been up a percent since this company was born a year ago. I'm talking about Kemore's CEO, Mark Vignal. Thank you so much for joining us on. Kathleen Hayes along with Pim Fox and this is Bloomberg