Koppers (KOP) Sidoti Small-Cap Virtual Conference summary

Strategic overview and investment thesis

• Focused on expanding and optimizing existing assets, with significant capital investments from 2021–2023 and a shift to lower CapEx in 2024–2025.

• Emphasis on enhancing product offerings and maintaining market leadership in critical infrastructure sectors.

• Vertical integration across business segments provides supply chain advantages and operational synergies.

• Over 70% of sales are derived from the U.S., with balanced revenue streams across railroad, utility, and chemical businesses.

Financial performance and 2025 outlook

• 2025 consolidated sales projected at $2.17 billion, a 4% increase over 2024, driven by volume growth and price improvements.

• Adjusted EBITDA forecasted at $280 million for 2025, up 7% from 2024, with cost containment initiatives supporting growth.

• Adjusted EPS expected to reach $4.75 in 2025, a 16% increase, reflecting higher operating earnings and lower interest expense.

• CapEx to decrease to $65 million in 2025, supporting significant free cash flow generation.

Capital allocation and shareholder returns

• Free cash flow prioritized for debt reduction, targeting a net leverage ratio below 3x by end of 2025.

• $100 million share repurchase program approved, representing about 20% of current market cap.

• Quarterly dividend increased to $0.08 per share, a 14% rise over the prior year, with ongoing annual increases.