Quaker Chemical : 2026 Presentation Q1

Published: 2026-04-30 20:09:01 ET KWR

Published on 04/30/2026 at 08:09 pm EDT

First Quarter 2026 Results Investor Conference Call

The information 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, taxes on income before equity in net income of associated companies - adjusted, non-GAAP net income and non-GAAP earnings per diluted share. The Company believes these non-GAAP financial measures provide meaningful supplemental information as they enhance a reader's understanding of the financial performance of the Company, facilitate a comparison among fiscal periods, and exclude items that management believes are not indicative of future operating performance or considered core to the Company's operations. Non-GAAP results are presented for supplemental informational purposes only and should not be considered a substitute for the financial information presented in accordance with GAAP. In addition, our definitions of EBITDA, adjusted EBITDA, adjusted EBITDA margin, non-GAAP operating income, non-GAAP operating margin, taxes on income before equity in net income of associated companies - adjusted, non-GAAP net income, and non-GAAP earnings per diluted share, as discussed and reconciled below to the most comparable GAAP measures, may not be comparable to similarly named measures reported by other companies.

The Company presents EBITDA, which is calculated as net income attributable to the Company before depreciation and amortization, interest expense, and taxes on income before equity in net income of associated companies. The Company also presents adjusted EBITDA, which is calculated as EBITDA plus or minus certain items that management believes are not indicative of future operating performance or considered core to the Company's operations. In addition, the Company presents non-GAAP operating income, which is calculated as operating income plus or minus certain items that management believes are not indicative of future operating performance or considered core to the Company's operations. In addition, the Company presents non-GAAP Adjusted EBITDA margin and non-GAAP operating margin, which are calculated as the percentage of adjusted EBITDA and non-GAAP operating income, respectively. The Company believes these non-GAAP measures provide transparent and useful information and are widely used by analysts, investors, and competitors in our industry, as well as by management in assessing the operating performance of the Company on a consistent basis.

Additionally, the Company presents non-GAAP net income and non-GAAP earnings per diluted share as additional performance measures. Non-GAAP net income is calculated as adjusted EBITDA, defined above, less depreciation and amortization, interest expense, and taxes on income before equity in net income of associated companies, in each case adjusted, as applicable, for any depreciation, amortization, interest or tax impacts resulting from the non-core items identified in the reconciliation of net income attributable to the Company to adjusted EBITDA. Non-GAAP earnings per diluted share is calculated as non-GAAP net income per diluted share as accounted for under the "two-class share method." The Company believes that non-GAAP net income and non-GAAP earnings per diluted share provide transparent and useful information and are widely used by analysts, investors, and competitors in our industry as well as by management in assessing the performance of the Company on a consistent basis.

As it relates to future projections for the Company as well as other forward-looking information contained in this presentation, the Company has not provided guidance for comparable GAAP measures or a quantitative reconciliation of forward-looking non-GAAP financial measures to the most directly comparable U.S. GAAP measure because it is unable to determine with reasonable certainty the ultimate outcome of certain significant items necessary to calculate such measures without unreasonable effort. These items include, but are not limited to, certain non-recurring or non-core items the Company may record that could materially impact net income. These items are uncertain, depend on various factors, and could have a material impact on the U.S. GAAP reported results for the guidance period.

The following charts should be read in conjunction with the Company's first quarter earnings news release dated April 30, 2026, which has been furnished to the Securities and Exchange Commission on Form 8-K, the Company's Annual Report for the year ended December 31, 2025, and the Company's 10-Q for the period ended March 31, 2026. These documents may contain additional explanatory language and information regarding certain of the items included in the following reconciliations.

Chief Executive Officer, President

Executive Vice President, Chief Financial Officer

Senior Vice President, General Counsel & Corporate Secretary

Director, Investor Relations

Q1'26 Highlights

Net Sales

Non-GAAP

Earnings per Diluted Share1

Adjusted EBITDA1

Leverage Ratio1,2

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 and in our SEC filings

2 Leverage ratio defined as gross debt minus cash and cash equivalents divided by trailing twelve month adjusted EBITDA

(Unaudited; Dollars in millions, unless otherwise noted)

Q1 2026 Q1 2025 Variance(1)

GAAP

Net sales

$ 480.5

$ 442.9

$ 37.6

8.5%

Operating income

33.6

27.6

6.0

21.6%

Operating income margin (%)

7.0%

6.2%

0.8%

Net income

19.7

12.9

6.8

52.8%

Earnings per diluted share

1.13

0.73

0.40

54.8%

Non-GAAP (2)

Non-GAAP operating income

45.3

45.8

(0.4)

(0.9%)

Non-GAAP operating margin (%)

9.4%

10.3%

(0.9%)

Adjusted EBITDA

72.5

69.0

3.5

5.0%

Adjusted EBITDA margin (%)

15.1%

15.6%

(0.5%)

Non-GAAP earnings per diluted share

1.63

1.58

0.05

3.2%

1 Certain amounts may not calculate due to rounding

2 These are non-GAAP measures. Refer to the reconciliations of our non-GAAP measures to their most comparable GAAP measures provided within this presentation and in our SEC filings.

(kilograms)

Q1 2024 Q2 2024 Q3 2024 Q4 2024 Q1 2025 Q2 2025 Q3 2025 Q4 2025 Q1 2026

Sales volumes increased by 3% in Q1'26 compared to Q1'25, primarily due to continued growth in the Asia/Pacific segment and new business wins across all segments, helping to offset a continuation of soft end market conditions

Sequentially, sales volumes increased by 2% in Q1'26 compared to Q4'25

1 The total company volume trend excludes volumes related to business impacted due to the war in Ukraine and volumes relating to the Sutai, Natech and Dipsol acquisitions.

Adjusted EBITDA1

(dollars in millions)

$320

$311

$299

$303

$257

2022 2023 2024 2025 Q1'26 LTM 2

$73

$69

Q1 2026 Q1 2025

Generated $73m of adjusted EBITDA in Q1'26, an increase of 5% year-over-year

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 and in our SEC filings.

2 The Company's reference to trailing twelve months adjusted EBITDA refers to the twelve-month period ended March 31, 2026 adjusted EBITDA of $302.7 million, which consists of (i) the three months ended March 31, 2026 adjusted EBITDA of $72.5 million and (ii) the twelve months ended December 31, 2025 adjusted EBITDA of $299.2 million less (iii) the three months ended March 31, 2025 adjusted EBITDA of $69.0 million.

Net Debt and Leverage Ratio1

$765

$787

(Dollars in Millions)

$815

Total debt of $875 million

Cash and cash equivalents of $170 million

Net debt of $705 million

Mar-22

3.0x

Jun-22

3.2x

Sep-22

3.3x

Dec-22

3.0x

$753

Mar-23

2.7x

$696

Jun-23

2.3x

$628

Sep-23

2.0x

$561

Dec-23

1.8x

$574

Mar-24

1.8x

$549

Jun-24

1.7x

$529

Sep-24

1.6x

$519

Dec-24

1.7x

$551

Mar-25

1.9x

$735

Jun-25

2.6x

$703

Sep-25

2.4x

$691

Dec-25

2.3x

$705

Mar-26

2.3x

Leverage of 2.3x as of March 31, 20261

$774

In April 2025, we funded the Dipsol acquisition with borrowings under our existing credit facility

Operating well within bank covenants

Bank leverage of 2.2x as of March 31, 20262

Maximum permitted leverage of 4.0x2

Healthy balance sheet and ample liquidity

Amended our credit agreement in April 2026, extending nearest term maturity to April 2031 and increasing available credit with improved terms

Q1'26 cost of debt on credit facility was ~4.8%

1 Leverage ratio, which is a non-GAAP measure, is defined as gross debt minus cash and cash equivalents divided by trailing twelve month adjusted EBITDA

2 Defined as net debt divided by trailing twelve month adjusted EBITDA, as calculated under the terms of the credit agreement

Appendix

Actual and Non-GAAP Results

Non-GAAP Operating Income Reconciliation

(Unaudited; Dollars in thousands, unless otherwise noted)

Three Months Ended March 31,

Non-GAAP Operating Income and Margin Reconciliations

2026

2025

Operating income

$ 33,589

$ 27,624

Restructuring and related charges, net

7,381

14,590

Acquisition-related expenses

715

3,329

Business transformation costs

1,659

Acquisition-related depreciation and amortization

1,608

Other charges

397

226

Non-GAAP operating income

$ 45,349

$ 45,769

Non-GAAP operating margin (%)

9.4 %

10.3 %

(Unaudited; Dollars in thousands, unless otherwise noted)

Three Months Ended March 31,

EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin Reconciliations:

2026

2025

Net income attributable to Quaker Chemical Corporation

$ 19,669

$ 12,922

Depreciation and amortization

25,870

20,830

Interest expense

9,879

9,545

Taxes on income before equity in net income of associated companies

7,145

7,542

EBITDA

62,563

50,839

Equity income in a captive insurance company

(607)

(671)

Restructuring and related charges, net

7,381

14,590

Acquisition-related expenses

715

3,329

Business transformation costs

1,659

Pension and postretirement benefit costs, non-service components

251

433

Currency conversion impacts of hyper-inflationary economies

171

535

Loss on acquisition-related hedges

1,943

Gain on sale of assets

(2,177)

Other charges

397

226

Adjusted EBITDA

$ 72,530

$ 69,047

Adjusted EBITDA margin (%)

15.1 %

15.6 %

Adjusted EBITDA Reconciliation

(Unaudited; Dollars in thousands, unless otherwise noted)

Twelve Months Ended December 31,

EBITDA, Adjusted EBITDA, and Adjusted EBITDA Margin Reconciliations:

2025

2024

2023

2022

Net income attributable to Quaker Chemical Corporation

$ (2,488)

$ 116,644

$ 112,748

$ (15,931)

Depreciation and amortization

94,402

85,108

83,020

81,514

Interest expense

44,048

41,002

50,699

32,579

Taxes on income before equity in net income of associated companies

24,607

49,300

55,585

24,925

EBITDA

160,569

292,054

302,052

123,087

Equity income in a captive insurance company

(4,272)

(2,930)

(2,090)

1,427

Acquisition-related step-up inventory amortization

6,022

Restructuring and related charges, net

35,130

6,530

7,588

3,163

Acquisition-related expenses (credits)

12,031

1,454

(475)

10,990

Strategic planning expenses (credits)

579

(290)

4,704

14,446

Gain on inventory and other adjustments

(3,256)

- -

Pension and postretirement benefit costs, non-service components

1,676

1,827

2,033 (1,704)

Executive transition costs

7,288

688

2,813

Customer insolvency costs

3,213

Currency conversion impacts of hyper-inflationary economies

2,216

811

7,849

1,617

Impairment charges

88,840

93,000

Loss on acquisition-related hedges

1,351

Gain on sale of assets

(2,534)

(492)

Multiemployer plan withdrawal charge

923

Brazilian non-income tax credits

(1,762)

Loss on extinguishment of debt

6,763

Other charges

1,725

1,453

(1,970)

1,548

Adjusted EBITDA $ 299,238 $ 310,918 $ 320,379 $ 257,150

Three Months Ended March 31,

Non-GAAP Earnings per Diluted Share Reconciliations

2026

2025

GAAP earnings per diluted share attributable to Quaker Chemical Corporation

common shareholders

$ 1.13

$ 0.73

Equity income in a captive insurance company

(0.03)

(0.04)

Restructuring and related charges, net

0.32

0.62

Acquisition-related expenses

0.03

0.14

Business transformation costs

0.07

Pension and postretirement benefit costs, non-service components

0.01

0.02

Currency conversion impacts of hyper-inflationary economies

0.01

0.03

Loss on acquisition-related hedges

0.08

Gain on sale of assets

(0.09)

Other charges

0.01

Discrete tax items

0.02

0.08

Acquisition-related depreciation and amortization

0.06

Non-GAAP earnings per diluted share $ 1.63 $ 1.58

(Unaudited; Dollars in thousands, except per share amounts)

Three Months Ended March 31,

2026

2025

Net sales

Americas

$ 213,728

$ 213,711

EMEA

142,083

129,278

Asia/Pacific

124,668

99,925

Total net sales

$ 480,479

$ 442,914

Segment operating earnings

Americas

$ 53,947

$ 58,462

EMEA

25,561

23,393

Asia/Pacific

34,276

25,930

Total segment operating earnings

113,784

107,785

Restructuring and related charges, net

(7,381)

(14,590)

Non-operating and administrative expenses

(55,087)

(50,717)

Depreciation of corporate assets and amortization

(17,727)

(14,854)

Operating income

33,589

27,624

Other expense, net

(23)

(709)

Interest expense

(9,879)

(9,545)

Income before taxes and equity in net income of associated companies

$ 23,687

$ 17,370

Disclaimer

Quaker Chemical Corporation published this content on April 30, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on April 30, 2026 at 23:49 UTC.