Quaker Houghton · NYSE:KWR
Quaker Houghton — Q1 2024 Earnings Presentation
16 slides from Quaker Houghton's earnings presentation, May 3, 2024
Slide 1: Quaker Houghton First Quarter 2024 Results
Quaker Houghton First Quarter 2024 Results Investor Conference Call
Slide 2: Forward-Looking Statements
Forward-Looking Statements Regulation G The attached charts include Company information that does not conform to generally accepted accounting principles (“GAAP”). Management believes that an analysis of this data is meaningful to investors because it provides insight with respect to ongoing operati
Slide 3: Non-GAAP Measures
Non-GAAP Measures The information included in this presentation includes non-GAAP (unaudited) financial information that includes EBITDA, adjusted EBITDA, adjusted EBITDA margin, non-GAAP operating income, non-GAAP operating margin, non-GAAP net income and non-GAAP earnings per diluted share. The Co
Slide 4: Speakers
Speakers Andy Tometich Chief Executive Officer, President Shane W. Hostetter Executive Vice President, Chief Financial Officer Robert T. Traub Senior Vice President, General Counsel & Corporate Secretary Jeffrey Schnell Vice President, Investor Relations 4 ©2024 Quaker Houghton. All Rights Reserved
Slide 5: Q1'24 Highlights
Q1’24 Highlights Strong start to 2024, generating net sales of $470m in a dynamic macroeconomic environment Gross margins improved to 38.7%, an improvement of 400bps Y/Y Delivered $83m of adj. EBITDA1, a 6% increase Y/Y, primarily reflecting an improvement in gross margins Operating cash flow of $27
Slide 6: Financial Snapshot
Financial Snapshot (Unaudited; Dollars in millions, unless otherwise noted) Q1 2024 Q1 2023 Variance(1) Q4 2023 Variance(1) GAAP Net sales $ 469.8 $ 500.1 $ (30.4) (6.1%) $ 467.1 $ 2.7 0.6% Gross profit 181.6 173.5 8.1 4.7% 171.2 10.4 6.1% Gross margin (%) 38.7% 34.7% 4.0% 11.4% 36.6% 2.0% 5.5% Oper
Slide 7: Total Company Volume Trend
1 Total Company Volume Trend (kilograms, in thousands) 150,000 125,000 100,000 75,000 50,000 25,000 — Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Sales volumes in Q1’24 declined slightly compared to Q1’23 pri
Slide 8: Adjusted EBITDA
1 Adjusted EBITDA (dollars in millions) $325 $320 $83 $79 $274 $257 $222 2020 2021 2022 2023 Q1'24 LTM Q1 2023 Q1 2024 Generated $83m of adjusted EBITDA in Q1’24, a 6% increase Y/Y, primarily due to an improvement in gross margins 1 This is a non-GAAP measure, refer to the reconciliations of our non
Slide 9: Leverage and Liquidity Update
Leverage and Liquidity Update Net Debt and Leverage Ratio1 (Dollars in Millions) • Total debt of $770 million $799 $815 $787 $774 $741 $717 $750 $759 $759 $736 $765 $753 • Cash and cash equivalents of $196 million $696 $628 • Net debt of $574 million $561 $574 • Leverage of 1.8x as of March 31, 2024
Slide 10: Appendix
Appendix Actual and Non-GAAP Results
Slide 11: Non-GAAP Operating Reconciliation
Non-GAAP Operating Reconciliation (Unaudited; Dollars in thousands, unless otherwise noted) Three Months Ended March 31, Non-GAAP Operating Income and Margin Reconciliations: 2024 2023 Operating income $ 55,526 $ 49,929 Restructuring and related charges, net 1,857 3,972 Strategic planning (credits)
Slide 12: Adjusted EBITDA & Non-GAAP Net Income Reconciliation
Adjusted EBITDA & Non-GAAP Net Income Reconciliation (Unaudited; Dollars in thousands, unless otherwise noted) Three Months Ended March 31, EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin and Non-GAAP Net Income Reconciliations: 2024 2023 Net income attributable to Quaker Chemical Corporation $ 35,2
Slide 13: Non-GAAP EPS Reconciliation
Non-GAAP EPS Reconciliation Three Months Ended March 31, Non-GAAP Earnings per Diluted Share Reconciliations: 2024 2023 GAAP earnings per diluted share attributable to Quaker Chemical Corporation common shareholders $ 1.95 $ 1.64 Equity income in a captive insurance company per diluted share (0.03)
Slide 14: Segment Performance
Segment Performance (Unaudited; Dollars in thousands, except per share amounts) Three Months Ended March 31, 2024 2023 Net sales Americas $ 229,754 $ 251,413 EMEA 138,422 152,449 Asia/Pacific 101,583 96,286 Total net sales $ 469,759 $ 500,148 Segment operating earnings Americas $ 66,770 $ 66,125 EME
Slide 15: Historical Segment Net Sales
1 Historical Segment Net Sales (Unaudited; Dollars in millions) Net Sales Quarterly Segment Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1’23 Q2’23 Q3’23 Q4’23 Q1’24 Americas $ 172.6 $ 115.2 $ 159.3 $ 159.9 $ 180.8 $ 186.6 $ 197.4 $ 197.4 $ 212.1 $ 235.8 $ 254.7 $ 243.9 $
Slide 16: Historical Segment Operating Earnings
1 Historical Segment Operating Earnings (Unaudited; Dollars in millions) Segment Operating Earnings Quarterly Segment Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1’23 Q2’23 Q3’23 Q4’23 Q1’24 Americas $ 41.3 $ 19.7 $ 43.8 $ 37.1 $ 44.7 $ 47.7 $ 43.4 $ 40.5 $ 45.0 $ 52.1 $