Quaker Houghton · NYSE:KWR
Quaker Houghton — Quaker Chemical — Q2 2015 Earnings Presentation
15 slides from Quaker Houghton's earnings presentation, Jul 30, 2015
Slide 1: Second Quarter 2015 Results Investor Conference Call
1 Second Quarter 2015 Results Investor Conference Call July 31, 2015 Quaker Chemical Corporation
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”). Management 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
Speakers Michael F. Barry Chairman of the Board, Chief Executive Officer & President Margaret M. Loebl Vice President, Chief Financial Officer & Treasurer Robert T. Traub Vice President, General Counsel & Corporate Secretary Chart #1
Slide 4: Second Quarter 2015 Headlines
Second Quarter 2015 Headlines ▪ Solid operating results drive 4% increase in non - GAAP earnings per diluted share, despite a negative impact of 8% from foreign exchange ▪ Market share gains and acquisitions offset difficult market conditions and foreign exchange ▪ Strong quarterly operating cash fl
Slide 5: Chairman Comments Second Quarter 2015
Chairman Comments Second Quarter 2015 ▪ Second Quarter 2015 x Foreign exchange headwinds continue to have the most significant impact on earnings x Market share gains, margin expansion, and acquisitions offset difficult market conditions and foreign exchange impact x Consistent earnings despite chal
Slide 6: Chief Financial Officer – Highlights Second Quarter 2015
1) Solid operating results drive quarterly non - GAAP earnings per diluted share of $1.15, up 4% from $1.11 in prior year quarter – Negative impact of $0.09 per diluted share, or 8%, due to foreign exchange 2) Quarterly sales up 4% on volumes, including recent acquisitions, offset by 7% decline from
Slide 7: Product Volume by Quarter
Product Volume by Quarter Thousand Kilograms 25,000 30,000 35,000 40,000 45,000 50,000 55,000 60,000 4Q08 YTD Avg. 1Q092Q093Q094Q091Q102Q103Q104Q101Q112Q113Q114Q111Q122Q123Q124Q121Q132Q133Q134Q131Q142Q143Q144Q141Q152Q15 Chart #5
Slide 8: Financial Snapshot
Financial Snapshot Q2 2015 Q2 2014 YTD 2015 YTD 2014 Net Sales ($Mils.) 183.7 191.3 365.1 373.0 Gross Margin (%) 38.4 35.7 37.5 35.7 Operating Margin (%) 11.7 10.9 10.8 10.8 Net Income attributable to Quaker Chemical Corporation ($Mils.) 15.0 15.4 25.4 28.2 Adjusted EBITDA ($Mils.) – Trailing Twelve
Slide 9: Gross Margin Percentage
Gross Margin Percentage 28.0% 34.7% 35.4% 32.6% 33.7% 35.8% 35.7% 37.5% 20.0% 25.0% 30.0% 35.0% 40.0% 2008 2009 2010 2011 2012 2013 2014 YTD 2015 Gross Margin Percentage 35.7% 35.4% 35.9% 36.6% 38.4% 20.0% 25.0% 30.0% 35.0% 40.0% Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Gross Margin Percentage Chart
Slide 10: Adjusted EBITDA Baseline Historical Performance
Adjusted EBITDA Baseline Historical Performance $40.1 $66.8 $73.0 $80.9 $89.6 $99.8 $99.7 $44.2 9.8% 12.3% 10.7% 11.4% 12.3% 13.0% 13.2% 6.9% 2008 2009 2010 2011 2012 2013 2014 Trailing Twelve Months Q2 2015 Adjusted EBITDA ($ Mils.) Adjusted EBITDA Margin (%) 2008 – 2015 CAGR: 13.9% +630 Margin bps
Slide 11: Balance Sheet Net Cash / (Debt)
Balance Sheet Net Cash / (Debt) -$100 -$80 -$60 -$40 -$20 $0 $20 $40 $60 $80 2008 2009 2010 2011 2012 2013 2014 Q2 2015 $ Millions Cash ST/LT Debt Net Debt Chart #9
Slide 12: Appendix
APPENDIX
Slide 13: Non-GAAP Earnings Per Diluted Share Reconciliation
Non - GAAP Earnings Per Diluted Share Reconciliation Chart #10 Q2 2015 Q2 2014 YTD 2015 YTD 2014 GAAP earnings per diluted share 1.13$ 1.16$ 1.90$ 2.13$ Equity loss (income) in a captive insurance company per diluted share 0.01$ (0.09)$ (0.05)$ (0.15)$ U.K. pension plan amendment per diluted share -
Slide 14: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation 2008 2009 2010 2011 2012 2013 2014 Net income 9,833 16,058 32,120 45,892 47,405 56,339 56,492 Depreciation 10,879 9,525 9,867 11,455 12,252 12,339 12,306 Amortization 1,177 1,078 988 2,338 3,106 3,445 4,325 Interest expense 5,509 5,533 5,225 4,666 4,283 2,922 2,371 Tax
Slide 15: Trailing Twelve Months Adjusted EBITDA Reconciliation
Trailing Twelve Months Adjusted EBITDA Reconciliation I = G + H H G = F - D F E = C + D D C = B - A B A Trailing Twelve Months Q2 2015 YTD Q2 2015 Last Six Months 2014 YTD 2014 Trailing Twelve Months Q2 2014 YTD Q2 2014 Last Six Months 2013 YTD 2013 YTD Q2 2013 Net income 53,751 25,416 28,335 56,492