Quaker Houghton · NYSE:KWR
Quaker Houghton — Quaker Chemical — Q4 2016 Earnings Presentation
14 slides from Quaker Houghton's earnings presentation, Feb 28, 2017
Slide 1: Fourth Quarter 2016 Results Investor Conference Call
1 Fourth Quarter 2016 Results Investor Conference Call March 1, 2017 Quaker Chemical Corporation
Slide 2: Regulation G and Forward-Looking Statements
Regulation G The attached charts include C ompany 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 Mary Dean Hall Vice President, Chief Financial Officer & Treasurer Robert T. Traub Vice President, General Counsel & Corporate Secretary Chart #1
Slide 4: Fourth Quarter 2016 Headlines
Fourth Quarter 2016 Headlines ▪ Organic volume growth of 7% drives a 4% increase in quarterly net sales despite continued FX headwinds ▪ Strong quarterly earnings of $1.31 per diluted share result in a 9% increase in non - GAAP earnings per diluted share to $1.26 ▪ Fourth quarter and full year net i
Slide 5: Chairman Comments Fourth Quarter and Full Year 2016
Chairman Comments Fourth Quarter and Full Year 2016 ▪ Fourth Quarter / Full Year 2016 x Revenue growth driven primarily by increases in organic volume with continued market share gains, which offset continued negative impacts from foreign exchange x SG&A leverage on cost savings efforts, including t
Slide 6: Fourth Quarter and Full Year 2016 Results Summary
▪ Non - GAAP earnings per diluted share increased 9% in the quarter to $1.26 and 4% for the full year to $4.60, despite the negative impact from foreign exchange of 5% for the quarter and 4% for the full year ▪ Fourth quarter and full year net sales growth driven by organic volume increases of 7% an
Slide 7: Financial Snapshot
($ Millions unless otherwise noted) Q4 2016 Q4 2015 YTD 2016 YTD 2015 Net Sales 191.2 183.3 746.7 737.6 Gross Margin 36.4% 37.5 % 37.4% 37.6% Operating Income 20.4 13.2 83.1 71.3 Operating Margin 10.7% 7.2 % 11.1% 9.7% Net Income Attributable to Quaker Chemical Corporation 17.4 11.4 61.4 51.2 Earnin
Slide 8: Product Volume by Quarter and Year
Chart #6 Organic and acquisition - related volume growth despite continued challenges in end - markets 115,000 135,000 155,000 175,000 195,000 215,000 235,000 255,000 25,000 31,000 37,000 43,000 49,000 55,000 61,000 67,000 Full Year Volume Quarter Volume Quarter Volume Full Year Volume Product Volum
Slide 9: Gross Margin Percentage Trends
28.0% 34.7% 35.4% 32.6% 33.7% 35.8% 35.7% 37.6% 37.4% 20.0% 25.0% 30.0% 35.0% 40.0% 2008 2009 2010 2011 2012 2013 2014 2015 2016 Gross Margin Percentage 37.5% 38.1% 38.1% 37.2% 36.4% 20.0% 25.0% 30.0% 35.0% 40.0% Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Gross Margin Percentage Chart #7 Quarterly gros
Slide 10: Adjusted EBITDA Historical Performance
2008 – 2016 CAGR: 13.0% +740 Margin bps Chart #8 $40.1 $44.2 $66.8 $73.0 $80.9 $89.6 $99.8 $101.6 $106.6 6.9% 9.8% 12.3% 10.7% 11.4% 12.3% 13.0% 13.8% 14.3% 2008 2009 2010 2011 2012 2013 2014 2015 2016 Adjusted EBITDA ($ Mils.) Adjusted EBITDA Margin (%) Adjusted EBITDA Baseline Historical Performan
Slide 11: Balance Sheet Cash and Debt
-$120 -$80 -$40 $0 $40 $80 $120 2008 2009 2010 2011 2012 2013 2014 2015 2016 $ Millions Cash ST/LT Debt Net Cash (Debt) Chart #9 Strong cash flow generation and balance sheet continue to support future growth Balance Sheet Cash and Debt
Slide 12: Appendix
@ Quaker APPENDIX
Slide 13: Non-GAAP Earnings Per Diluted Share Reconciliation
Chart #10 Q4 2016 Q4 2015 Full Year 2016 Full Year 2015 GAAP earnings per diluted share attributable to Quaker Chemical Corporation Common Shareholders 1.31$ 0.86$ 4.63$ 3.84$ Equity income in a captive insurance company per diluted share (0.06) (0.07) (0.13) (0.16) Restructuring (credit) expense pe
Slide 14: Adjusted EBITDA Reconciliation
Chart #11 2008 2009 2010 2011 2012 2013 2014 2015 2016 Net income attributable to Quaker Chemical Corporation 9,833 16,058 32,120 45,892 47,405 56,339 56,492 51,180 61,403 Depreciation 10,879 9,525 9,867 11,455 12,252 12,339 12,306 12,395 12,557 Amortization 1,177 1,078 988 2,338 3,106 3,445 4,325 6