NYSE$KWR

Quaker Chemical Corporation · Q3 2022 earnings

Q3 2022 earnings · · Investor relations

Briefing

Quaker Houghton's net sales increased due to price and product mix, but volumes were impacted by softer market conditions.

Quaker Houghton reported a net sales increase of 10% in Q3 2022, driven by pricing actions and acquisitions, despite volume declines due to softer market conditions, particularly in Europe and Asia/Pacific. The company's net income was $25.9 million, or $1.44 per diluted share, while non-GAAP earnings per diluted share were $1.74. Adjusted EBITDA increased by 6% to $70.3 million.

  • Net sales increased by 10% to $492.2 million, driven by a 25% increase in selling price and product mix.
  • Net income was $25.9 million, or $1.44 per diluted share, compared to $31.1 million, or $1.73 per diluted share in the prior year quarter.
  • Non-GAAP earnings per diluted share were $1.74, compared to $1.63 in the prior year quarter.
  • Adjusted EBITDA increased by 6% to $70.3 million.

Headline financials

Total Revenue

$492M

Previous: $449M+9.6%
EPS (adj)

$1.74

Previous: $1.63+6.7%
Sales Volume Change

-9.0%

Previous: 10.0%-190.0%
Capital Expenditures

-$20.2M

Previous: -$12.8M-57.8%
Free Cash Flow

$5.64M

Previous: $18.2M-69.1%
Net Income

$25.9M

Previous: $31.1M-16.7%
Operating Income

$44.6M

Previous: $36M+23.9%
Gross Profit

$161M

Previous: $145M+10.8%
Cash & Equivalents

$139M

Previous: $141M-1.8%
Total Assets

$2.83B

Previous: $2.94B-3.8%
Stock-Based Comp

$3.2M

Previous: $2.31M+38.8%

Revenue & EPS history

Quaker Chemical · Revenue · Quarterly

$492M

Q3 2022+9.6%vs Q3 2021
Beat estimate in 10 of 15 quarters(67%)
ActualEstimate

Forward guidance

Company expects the current uneven demand environment and seasonal demand trends to weigh on end markets in the fourth quarter of 2022 and expects to deliver sequential margin expansion.

Tailwinds

  • Expect to deliver sequential margin expansion in the fourth quarter of 2022
  • Continue to work to return to pre-pandemic margin levels
  • Focused on improving profitability through additional pricing and cost controls
  • Simplifying operating model to align with the macroeconomic environment
  • Continuing to prioritize new business wins

Headwinds

  • Expect the current uneven demand environment to weigh on our end markets in the fourth quarter
  • Expect seasonal demand trends to weigh on our end markets in the fourth quarter
  • Volumes were impacted by a softer end market environment, primarily in Europe and China
  • Volumes impacted by war in Ukraine.
  • Foreign currency headwinds

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2022

Historical avgQ3 2022

+1.5%

Avg return

Earnings day

+0.9%

Avg return

5 days after

+0.4%

Avg return

30 days after

52%

34 / 65 earnings

Positive

+20.6%

Q2 2022

Best reaction

-10.0%

Q2 2019

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+2.0%+5.1%+7.4%
Q4 2025+1.1%-13.5%-25.8%
Q3 2025+5.5%+7.1%+9.6%
Q1 2025-2.6%-5.8%+2.3%
Q4 2024+2.6%-1.2%-7.8%
Q3 2024+4.2%+3.9%+2.0%
Q2 2024-6.5%-8.0%-3.3%
Q1 2024-1.0%-0.2%-3.3%
Q4 2023+0.5%-0.2%+4.1%
Q3 2023+13.0%+14.6%+28.9%
Q2 2023-5.3%-9.1%-11.4%
Q1 2023+11.3%+11.5%+7.8%
Q4 2022+0.6%+0.5%-5.0%
Q3 2022+6.4%+19.1%+25.1%
Q2 2022+20.6%+21.3%+8.7%
Q1 2022-2.8%-13.4%-5.1%
Q4 2021-3.4%-10.9%-4.2%
Q3 2021+3.6%+3.9%-12.3%
Q2 2021-1.9%+2.8%+4.3%
Q1 2021-0.7%-1.6%-1.5%
Q4 2020-4.2%-5.3%-20.1%
Q3 2020+8.9%+22.6%+24.2%
Q2 2020-1.8%+1.5%-2.6%
Q1 2020+7.6%+3.8%+21.8%
Q4 2019+1.1%+0.1%-28.9%
Q3 2019-4.2%-7.6%-0.6%
Q2 2019-10.0%-10.5%-15.2%
Q1 2019-3.3%-6.6%-18.6%
Q4 2018-0.5%-3.5%-4.6%
Q3 2018+13.3%+13.7%+14.6%
Q2 2018+10.0%+3.2%+10.0%
Q1 2018-2.0%-2.4%+3.3%
Q4 2017+1.1%-0.7%-2.1%
Q3 2017+4.8%+3.9%+8.1%
Q2 2017-3.9%-5.4%-8.2%
Q1 2017-0.5%+0.0%-3.6%
Q4 2016+2.9%+0.8%-2.4%
Q3 2016+1.9%+2.3%+20.0%
Q2 2016-0.1%+0.1%+1.1%
Q1 2016-1.4%
Q4 2015+6.1%
Q3 2015+5.1%
Q2 2015+16.0%
Q1 2015-5.5%
Q4 2014-7.0%
Q3 2014+8.7%
Q2 2014-0.3%
Q1 2014-2.7%
Q4 2013+6.8%
Q3 2013-3.1%
Q2 2013+1.7%
Q1 2013+8.6%
Q4 2012+1.9%
Q3 2012+11.6%
Q2 2012+2.8%
Q1 2011-1.6%
Q1 2012+0.2%
Q4 2009-1.6%
Q4 2011-1.6%
Q3 2010+3.5%
Q3 2011+3.5%
Q4 2010-4.3%
Q2 2010-4.3%
Q2 2011-4.3%
Q1 2010-6.6%

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