Quaker Houghton · NYSE:KWR
Quaker Houghton — Q3 2024 Earnings Presentation
16 slides from Quaker Houghton's earnings presentation, Nov 1, 2024
Slide 1: Third Quarter 2024 Results Investor Conference Call
Quaker Houghton Third 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 Tom Coler 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: Q3'24 Highlights
Q3’24 Highlights Net sales of $462m declined 6% Y/Y due to continuation of soft end market conditions Gross margins remained consistent with the prior year at 37.3% Delivered $79m of adj. EBITDA1, a 7% decrease Y/Y reflecting the impact of lower sales Generated operating cash flow of $142m YTD; Bala
Slide 6: Financial Snapshot
Financial Snapshot (Unaudited; Dollars in millions, unless otherwise noted) Q3 2024 Q3 2023 Variance(1) Q2 2024 Variance(1) YTD 2024 YTD 2023 Variance(1) GAAP Net sales $ 462.3 $ 490.6 $ (28.3) (5.8%) $ 463.6 $ (1.3) (0.3%) $1,395.6 $1,486.2 $ (90.6) (6.1%) Gross profit 172.5 183.3 (10.8) (5.9%) 175
Slide 7: Total Company Volume Trend
Total Company Volume Trend1 (kilograms, in thousands) Sales volumes in Q3’24 declined slightly compared to Q3’23, primarily due to softer end market conditions T The total company volume trend excludes volumes in the prior periods that are related to the tolling agreement for products previously div
Slide 8: Adjusted EBITDA
Adjusted EBITDA1 (dollars in millions) Generated $79m of adjusted EBITDA in Q3’24, a 7% decrease Y/Y, primarily due to softer market conditions 1 This is a non-GAAP measure, refer to the reconciliations of our non-GAAP measures to their most comparable GAAP measures provided within this presentation
Slide 9: Leverage and Liquidity Update
Leverage and Liquidity Update Net Debt and Leverage Ratio1 (Dollars in Millions) • Total debt of $741 million • Cash and cash equivalents of $212 million • Net debt of $529 million • Leverage of 1.6x as of September 30, 20241 • Operating well within bank covenants ◦ Bank leverage of 1.6x as of Septe
Slide 10: Appendix: Actual and Non-GAAP Results
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 Nine Months Ended September 30, September 30, Non-GAAP Operating Income and Margin Reconciliations: 2024 2023 2024 2023 Operating income $ 51,718 $ 59,518 $ 165,693 $ 166,242 Restructuring
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 Nine Months Ended September 30, September 30, EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin and Non-GAAP Net Income Reconciliations: 2024 2023 2024 2023 Net income attr
Slide 13: Non-GAAP EPS Reconciliation
Non-GAAP EPS Reconciliation Three Months Ended Nine Months Ended September 30, September 30, Non-GAAP Earnings per Diluted Share Reconciliations: 2024 2023 2024 2023 GAAP earnings per diluted share attributable to Quaker Chemical Corporation common shareholders $ 1.81 $ 1.87 $ 5.70 $ 5.14 Equity inc
Slide 14: Segment Performance
Segment Performance (Unaudited; Dollars in thousands, except per share amounts) Three Months Ended Nine Months Ended September 30, September 30, 2024 2023 2024 2023 Net sales Americas $ 220,275 $ 245,899 $ 673,546 $ 750,531 EMEA 134,135 139,620 410,558 435,602 Asia/Pacific 107,864 105,093 311,496 30
Slide 15: Historical Segment Net Sales
Historical Segment Net Sales1 (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 Q2’24 Q3’24 Americas $ 172.6 $ 115.2 $ 159.3 $ 159.9 $ 180.8 $ 186.6 $ 197.4 $ 197.4 $ 212.1 $ 235.8 $ 254.
Slide 16: Historical Segment Operating Earnings
Historical Segment Operating Earnings1 (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 Q2’24 Q3’24 Americas $ 41.3 $ 19.7 $ 43.8 $ 37.1 $ 44.7 $ 47.7 $ 43.4 $ 40.5 $ 45