Quaker Houghton · NYSE:KWR
Quaker Houghton — Quaker Chemical — Q3 2021 Earnings Presentation
22 slides from Quaker Houghton's earnings presentation, Nov 4, 2021
Slide 1: Quaker Houghton Third Quarter 2021 Results Investor Conference Call
Quaker Houghton Third Quarter 2021 Results Investor Conference Call
Slide 2: Regulation G and Forward-Looking Statements
Regulation G The attached charts include Company information that does not conform to generally accepted accounting principles (“GAAP”). Man agement believes that an analysis of this data is meaningful to investors because it provides insight with respect to ongoing operating results of the Company
Slide 3: Speakers
Michael F. Barry Chairman of the Board, Chief Executive Officer & President Andrew E. Tometich Chief Executive Officer & President (effective December 1, 2021) Shane W. Hostetter Senior Vice President, Chief Financial Officer Robert T. Traub Senior Vice President, General Counsel & Corporate Secreta
Slide 4: Third Quarter 2021 Headlines
©2020 Quaker Houghton. All Rights Reserved 4 • Record net sales of $449.1 million increased 22% compared to the third quarter of 2020 • Reported net income of $31.1 million, earnings per diluted share of $1.73 and non - GAAP net income of $29.4 million • Non - GAAP earnings per diluted share of $1.6
Slide 5: Chairman Comments and Fourth Quarter 2021 Outlook
©2020 Quaker Houghton. All Rights Reserved 5 Chairman Comments Third Quarter of 2021 • Record quarterly net sales despite the continued negative impacts of the automotive semiconductor shortage and supply chain challenges • Demand continues to be the major contributor to earnings performance as orga
Slide 6: Financial Highlights
©2020 Quaker Houghton. All Rights Reserved 6 Financial Highlights Third quarter of 2021 • Record net sales of $449.1 million increased 22% due to higher volumes of 10%, which includes additional net sales from acquisitions of 4%, increases in selling price and product mix of approximately 10% and th
Slide 7: Financial Snapshot
©2020 Quaker Houghton. All Rights Reserved 7 Financial Snapshot (dollars in millions, unless otherwise noted) (1) Certain amounts may not calculate due to rounding Q3 2021 Q3 2020 Q2 2021 YTD 2021 YTD 2020 GAAP Net Sales $ 449.1 $ 367.2 $ 81.8 22% $ 435.3 $ 13.8 3% $1,314.1 $1,031.8 $ 282.3 27% Gros
Slide 8: Q3'21 volumes up 10% compared to Q3'20
Q3’21 volumes up 10% compared to Q3’20 (including acquisitions of 4%) Total Company Volume Trend (k ilograms, in thousands ) 8 ©2020 Quaker Houghton. All Rights Reserved 60,000 80,000 100,000 120,000 140,000 Q1 '20 Q2 '20 Q3 '20 Q4 '20 Q1 '21 Q2 '21 Q3 '21
Slide 9: Pro Forma Adjusted EBITDA
©2020 Quaker Houghton. All Rights Reserved 9 Pro Forma Adjusted EBITDA (dollars in millions) Record TTM adjusted EBITDA driven by strong net sales growth (1) Results presented above for 2020 and 2021 are the actual results for Quaker Houghton, all other years are pro forma results $215 $221 $236 $23
Slide 10: Leverage
Leverage Reported 3.5 3.4 3.7 3.4 3.2 3.1 2.7 2.7 Bank 2.9 2.8 3.1 2.9 2.8 2.8 2.5 2.5 $811 $811 $799 $741 $717 $750 $759 $759 $600 $650 $700 $750 $800 $850 $900 Dec-19 Mar-20 Jun-20 Sep-20 Dec-20 Mar-21 Jun-21 Sep-21 Net Debt • Total gross outstanding borrowings of $900.7 million and cash on hand o
Slide 11: Appendix: Actual and Non-GAAP Results
Appendix Actual and Non - GAAP Results
Slide 12: Non-GAAP financial information notes
The information included in this presentation includes non - GAAP (unaudited) financial information that includes EBITDA, adjusted EBITDA, adjusted EBITDA margin, non - GAAP operating income, non - GAAP operating margin, non - GAAP net income, non - GAAP earnings per diluted share, and pro forma net
Slide 13: Non-GAAP Operating Income Reconciliation
©2020 Quaker Houghton. All Rights Reserved 13 Non - GAAP Operating Income Reconciliation (dollars in thousands, unless otherwise noted) Q3 2021 Q3 2020 YTD 2021 YTD 2020 Operating income 36,010$ 34,859$ 119,720$ 24,653$ Houghton combination, integration and other acquisition-related expenses Restruc
Slide 14: Adjusted EBITDA & Non-GAAP Net Income Reconciliation
©2020 Quaker Houghton. All Rights Reserved 14 Adjusted EBITDA & Non - GAAP Net Income Reconciliation (dollars in thousands, unless otherwise noted) Q3 2021 Q3 2020 YTD 2021 YTD 2020 Net income (loss) attributable to Quaker Chemical Corporation 31,058$ 27,304$ 103,243$ (8,812)$ Depreciation and amort
Slide 15: TTM Adjusted EBITDA Reconciliation
A B C = B - A D E = C + D YTD Q3 2020 Full Year 2020 Last Three Months 2020 YTD Q3 2021 TTM Q3 2021 Net (loss) income attributable to Quaker Chemical Corporation (8,812)$ 39,658$ 48,470$ 103,243$ 151,713$ Depreciation and amortization 63,764 84,494 20,730 66,334 87,064 Interest expense, net 22,109 2
Slide 16: Non-GAAP EPS Reconciliation
©2020 Quaker Houghton. All Rights Reserved 16 Non - GAAP EPS Reconciliation Q3 2021 Q3 2020 YTD 2021 YTD 2020 GAAP earnings (loss) per diluted share attributable to Quaker Chemical Corporation common shareholders Equity income in a captive insurance company per diluted share (0.01) (0.03) (0.23) (0.
Slide 17: Segment Performance
©2020 Quaker Houghton. All Rights Reserved 17 Segment Performance (dollars in thousands) Q3 2021 Q3 2020 YTD 2021 YTD 2020 Net sales Americas 150,799$ 119,540$ 425,343$ 330,012$ EMEA 122,241 94,005 365,491 276,546 Asia/Pacific 98,659 84,877 286,924 226,850 Global Specialty Businesses 77,373 68,802 2
Slide 18: Quaker Houghton: Forward Together
& Quaker Vg Houghton. Forward Together
Slide 19: Full Year 2019 Pro Forma Reconciliation
©2020 Quaker Houghton. All Rights Reserved 19 Full Year 2019 Pro Forma Reconciliation (dollars in millions) Quaker Houghton Divestitures Other (a) Pro Forma* Net sales 1,134$ 475$ (34)$ (13)$ 1,562$ Net Income (Loss) Attributable to Quaker Houghton 32$ (3)$ (6)$ 10$ 33$ Depreciation and Amortization
Slide 20: Full Year 2018 Pro Forma Reconciliation
20 ©2020 Quaker Houghton. All Rights Reserved Full Year 2018 Pro Forma Reconciliation (dollars in millions) Quaker Houghton Divestitures Other (a) Pro Forma* Net sales 868$ 861$ (53)$ (22)$ 1,655$ Net Income (Loss) Attributable to Quaker Houghton 59$ (0)$ (9)$ 17$ 66$ Depreciation and Amortization 2
Slide 21: Full Year 2017 Pro Forma Reconciliation
21 ©2020 Quaker Houghton. All Rights Reserved Full Year 2017 Pro Forma Reconciliation (dollars in millions) Quaker Houghton Divestitures Other (a) Pro Forma* Net Income (Loss) Attributable to Quaker Houghton 20$ (47)$ (9)$ 9$ (26)$ Depreciation and Amortization 20 55 - 5 80 Interest Expense, Net 1 5
Slide 22: Full Year 2016 Pro Forma Reconciliation
22 ©2020 Quaker Houghton. All Rights Reserved Full Year 2016 Pro Forma Reconciliation (dollars in millions) Quaker Houghton Divestitures Other (a) Pro Forma* Net Income (Loss) Attributable to Quaker Houghton 61$ (37)$ (8)$ 7$ 23$ Depreciation and Amortization 20 55 - 5 80 Interest Expense, Net 1 51