Kronos Worldwide (KRO) Q1 2025 earnings summary

Executive summary

• Net income rose to $18.1 million ($0.16/share) in Q1 2025 from $8.1 million ($0.07/share) in Q1 2024, driven by higher sales, production volumes, improved operating rates, increased average TiO2 selling prices, and lower per-unit production costs.

• The acquisition of the remaining 50% interest in Louisiana Pigment Company (LPC) in July 2024 made LPC a wholly-owned subsidiary, with its results fully consolidated from the acquisition date.

• Q1 2024 results included a $1.5 million charge for the write-off of deferred financing costs.

Financial highlights

• Net sales increased 2% year-over-year to $489.8 million in Q1 2025, with higher sales in North America and Europe offsetting export declines.

• Gross margin improved to 22% of net sales ($106.8 million) in Q1 2025 from 15% ($71.5 million) in Q1 2024.

• Segment profit rose to $41.6 million from $23.4 million year-over-year.

• EBITDA rose to $51.2 million from $31.7 million year-over-year.

• Cash used in operating activities increased to $102.4 million from $43.3 million, mainly due to higher working capital needs and increased interest payments.

Outlook and guidance

• Demand improved in Q1 2025, especially in Europe, but uncertainty around U.S. tariffs is tempering North American demand.

• TiO2 selling prices are stable in North America and export markets, with slight increases in Europe.

• Cost reduction initiatives and process improvements are ongoing, with raw material and energy costs expected to moderate.

• Operating results are expected to improve in 2025, subject to demand stability.

• Management notes forward-looking statements are subject to substantial risks and uncertainties, including supply/demand, integration of acquisitions, and global economic conditions.