KWR

Quaker Chemical (KWR) appears an attractive pick given a noticeable improvement in the company's earnings outlook. The stock has been a strong performer lately, and the momentum might continue with analysts still raising their earnings estimates for the company. Analysts' growing optimism on the earnings prospects of this specialty chemical company is driving estimates higher, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. Our stock rating tool -- the Zacks Rank -- is principally built on this insight. The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008. For Quaker Chemical, strong agreement among the covering analysts in revising earnings estimates upward has resulted in meaningful improvement in consensus estimates for the next quarter and full year. The chart below shows the evolution of forward 12-month Zacks Consensus EPS estimate: The company is expected to earn $2.16 per share for the current quarter, which represents a year-over-year change of +3.9%. Over the last 30 days, four estimates have moved higher for Quaker Chemical compared to no negative revisions. As a result, the Zacks Consensus Estimate has increased 6.34%. For the full year, the company is expected to earn $7.85 per share, representing a year-over-year change of +11.8%. In terms of estimate revisions, the trend for the current year also appears quite encouraging for Quaker Chemical. Over the past month, five estimates have moved higher compared to no negative revisions, helping the consensus estimate increase 9.66%. Thanks to promising estimate revisions, Quaker Chemical currently carries a Zacks Rank #1 (Strong Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision.You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500. Quaker Chemical shares have added 10.7% over the past four weeks, suggesting that investors are betting on its impressive estimate revisions. So, you may consider adding it to your portfolio right away to benefit from its earnings growth prospects. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Quaker Houghton (KWR) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Image source: The Motley Fool. Friday, July 31, 2026 at 8:00 a.m. ET Director, Investor Relations - John Dalhoff President and Chief Executive Officer - Joseph Berquist Executive Vice President and Chief Financial Officer - Tom Coler General Counsel - Robert Traub Operator: Greetings, and welcome to the Quaker Houghton Second Quarter 2026 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the call over to John Dalhoff, Director of Investor Relations. Mr. Dalhoff, you may begin. John Dalhoff: Thank you. Good morning, and welcome to Quaker Houghton's Second Quarter 2026 Earnings Conference Call. Joining us on the call today are Joe Berquist, our President and Chief Executive Officer; Tom Coler, our Executive Vice President and Chief Financial Officer; and Robert Traub, our General Counsel. Our comments relate to the financial information released after the close of the U.S. markets yesterday, July 30, 2026. Our press release and accompanying slides can be found on our Investor Relations website. Both the prepared commentary and discussion during this call may contain forward-looking statements, reflecting the company's current view of future events and their potential effect on Quaker Houghton's operating and financial performance. These statements involve uncertainties and risks, which may cause actual results to differ. The company is under no obligation to provide subsequent updates to these forward-looking statements. This presentation also contains certain non-GAAP financial measures, and the company has provided reconciliations to the most directly comparable GAAP financial measures in the appendix of the presentation materials, which are available on our website. For additional information, please refer to our filings with the SEC. Now it's my pleasure to hand the call over to Joe. Joseph Berquist: Thank you, John, and good morning, everyone. We achieved our fourth consecutive quarter of year-over-year profitability growth in the second quarter, highlighted by a 7% increase in sales volumes. This resulted in the highest quarterly adjusted EBITDA in our company's 160-plus years history. Our volume increase was driven by broad-based growth and net share gains across all regions, amid end markets that we estimate were flat to slightly above the prior year in the aggregate, tempered by offsetting pockets of strength and weakness. Demand remained steady through the end of the quarter after a strong start in April as some customers accelerated buying against the backdrop of the crisis in the Strait of Hormuz. Asia Pacific once again delivered the strongest performance, marking a second consecutive quarter of double-digit volume growth. Our team successfully navigated sharp increases in raw material costs and supply disruption resulting from the conflict in the Strait of Hormuz. Through disciplined execution and by engaging in proactive customer communication, we were able to leverage the flexibility of our global manufacturing network and maintain supply continuity throughout the quarter. Gross margins declined sequentially, but stronger volumes and improved utilization rates helped offset product margin pressure. We implemented price increases throughout the quarter, and we'll see further adjustments from our index pricing in the third quarter. Underlying market conditions were mixed. Demand was steady despite the geopolitical uncertainty with pockets of growth in select markets as normal buying patterns returned. Steel and aluminum end markets trended positively, while automotive light vehicle production remained challenged across most regions and geographies. Some customer purchasing activity may have been pulled forward in response to the Middle East conflict early in the quarter, but we do not believe prebuy activity had a significant impact on the quarter's results. In aggregate, we estimate end markets were flat to slightly above the prior year, underscoring the significant contribution of share gains to our volume growth. Turning to the second quarter results. Net sales increased 10% year-over-year, driven by mid- to high single-digit share gains and were achieved across all regions. Momentum remains strongest in Asia Pacific, where we are winning significant new business in metalworking by penetrating growing sectors like electrical vehicle OEMs and component manufacturers. We continue to execute effectively in attractive growth markets such as China, India and Thailand, where our investments in local capabilities and customer relationships are translating into meaningful wins. The Americas and EMEA regions each delivered mid-single-digit volume growth during the quarter. In the Americas, we saw improvement in customer activity levels with the return of previously idled capacity and contributions from recent business wins. The Americas region delivered one of its strongest volume performances in several quarters as operational and customer-specific challenges that affected prior periods improved against the backdrop of firming demand. Our strong customer pipeline and commercial execution drove volume growth in EMEA as we benefited from recent wins in metals and metalworking in that region and continue to grow in the Middle East and Africa despite the challenging backdrop. Adjusted EBITDA margins reached 16% during the quarter, reflecting the increased top line performance and stable SG&A, which declined as a percentage of sales versus the first quarter. In addition to delivering strong financial results, we are executing key strategic initiatives that support our long-term growth and profitability objectives. We remain committed to a disciplined and balanced capital allocation strategy. In May, we announced a new $250 million stock repurchase authorization and returned approximately $24 million of cash to shareholders through repurchases during the second quarter. We also successfully completed the refinancing of our credit facility, further enhancing financial flexibility. In addition, our Board of Directors approved an approximately 4% increase to the quarterly dividend, marking our 17th consecutive annual dividend increase and our 50th dividend increase since becoming a public company. At the same time, we remain active evaluating potential acquisition opportunities that strengthen our business and support our long-term growth strategy. We continue to assess targets that expand our portfolio, accelerate innovation and deliver geographic and channel diversification in new markets. With our strong balance sheet and improved financial flexibility, we remain well positioned to pursue strategic opportunities that create value for shareholders. We will continue to take a prudent approach to capital deployment, weighing returns to shareholders, balance sheet discipline and careful investments in growth. Turning to the conflict in the Middle East. We continue to navigate the ongoing challenges and are maintaining reliable supply, and strong service levels to our customers in a tough environment. Our direct sales into the Middle East and Africa have remained steady, and our consistency of supply has enabled us to win new business in the region. We continue to monitor the situation closely, but have not experienced any significant supply disruptions to date. In many instances, global supply chains have begun adapting to the changing environment, and our global network flexibility continues to ensure reliable service to our customers. But the situation is volatile and the trajectory is uncertain. We are continuing to invest in the capabilities and infrastructure that further strengthen our network and position us for future growth. In June, we achieved an important milestone in our Asia Pacific plan with the successful start-up of our new manufacturing facility in Zhangjiagang, China. This new site enhances our local-for-local operating model and will enable us to manufacture the full breadth of our portfolio inside China, reducing the need to import certain products and thereby creating additional flexibility, efficiency and service responsiveness for customers throughout the Asia Pacific region. More broadly, we continue to take actions across the business to improve efficiency, simplify operations and optimize our cost structure. We are pleased with the progress we are making with the business transformation and cost optimization program announced last quarter. The actions we implemented during the second quarter are expected to deliver approximately $10 million of run rate savings with benefits already reflected in our Q2 results. We will continue to focus on process simplification, productivity improvement and manufacturing footprint optimization, which will further strengthen our profitability over time. The opportunity for profitability improvement over the next few years supports our long-term goal to achieve EBITDA margins above 18%. Finally, we released our annual sustainability report during the second quarter, highlighting our progress in advancing sustainable solutions for our customers and improving the environmental performance of our operations. The accomplishments highlighted in this year's report underscore how sustainability is embedded within our culture and is central to how we innovate, operate and partner with customers around the world. Turning to the outlook. Our view on underlying market conditions remains unchanged. The first half of the year progressed in line with our expectations, and we still expect end markets will be flat to modestly positive during the second half of 2026. Raw material costs have currently stabilized, but at elevated levels. Base oil prices remain volatile due to supply constraints across the refinery network and ongoing uncertainty. Based on our current visibility to supply dynamics, we expect our overall input costs to remain stable at these higher rates in the short term and begin to moderate as we progress through the back half of the year. As a result, we anticipate that our gross margin percentage in the third quarter will be in the range of Q2 gross margins as we work through the timing of raw material cost inflation, inventory movements and price recovery actions. At the same time, incremental pricing actions and certain index-based adjustments will take effect, which will provide increasing benefits as the quarter progresses and should return us to our target range above 36% by the end of the year. Operationally, we were pleased by the strong volume performance in Q2. Demand remains healthy and is showing no signs of slowing in the early part of the third quarter. We expect normal seasonal patterns in the second half, which has historically been better than the first half of the year. In the third quarter specifically, there may be longer seasonal shutdown activity in parts of Europe with the summer holiday period and unseasonably higher temperatures across the continent as well as customers managing their inventories. However, demand in the Americas is improving and tracking broadly in line with normal seasonal patterns, which should help offset the expected slowness in Europe. We anticipate our third quarter performance will be in the range of the second quarter, barring disruptions in the market. As a result, we expect to deliver meaningful revenue and mid- to high single-digit adjusted EBITDA growth for the full year 2026. Our consistent ability to generate share gains, our commitment to execute pricing actions and improve our cost structure and the advantages derived from our global operating network position us well to steadily navigate uncertainty while creating long-term value. In closing, I am extremely proud of how our team performed during a particularly challenging quarter. Our industry-leading teams of operators and experts enabled us to achieve outsized share gains despite the volatility in the macro environment, resulting in record quarterly EBITDA. We continue to demonstrate the resilience in our differentiated service model that are enabling us to win regardless of external market conditions. And we expect to carry our strong momentum through the remainder of the year. With that, I will turn the call over to Tom to walk through the financials in more detail. Tom Coler: Thank you, Joe, and good morning, everyone. Second quarter net sales were $533 million, a 10% increase from the prior year. Sales volumes increased 7%, driven by global net share gains that exceeded the high end of our target range, with Asia Pacific once again being the largest contributor. Selling price and product mix contributed an additional 1% to net sales as pricing actions to offset higher raw material costs resulting from the Middle East conflict were partially offset by changes in the mix of products and services. Sequentially, selling price and product mix contributed a 4% increase to net sales compared to the first quarter. We also had a benefit of 2% to net sales year-over-year from favorable foreign currency across all regions. The second quarter marked the first period in which prior year acquisitions, including Dipsol, are included entirely within our organic results. Gross margins declined on both a year-over-year and sequential basis to 35.5% due to product margin pressure from higher raw material costs. The sequential decline of 130 basis points was less pronounced than originally anticipated due to better top line performance stemming from higher volumes from our global net share gains as well as solid execution on our 2 rounds of price increases to offset raw material inflation during the quarter. On a non-GAAP basis, SG&A increased approximately $10 million or 8% in the second quarter compared to the prior year. While we began to see benefits from the transformation actions taken during the second quarter, these benefits were offset by higher incentive compensation and unfavorable foreign currency impacts. We delivered $85 million of adjusted EBITDA in the second quarter, while adjusted EBITDA margin of 16% increased 40 basis points year-over-year and 90 basis points sequentially. This performance highlights the operating leverage in our business as strong volume growth drove earnings expansion even in an inflationary environment where margins were under pressure. Switching now to our segment results. Asia Pacific sales in the second quarter increased 12% year-over-year, driven by the second consecutive quarter of 10% organic volume growth. This was the result of new business wins that once again exceeded the high end of our total company target range of 2% to 4%. Favorable selling price and foreign currency also each contributed 1% growth to net sales. Segment earnings in Asia Pacific increased approximately $8 million or 27% in the second quarter compared to the prior year, driven by higher sales volumes. Second quarter net sales in EMEA increased 13% year-over-year, driven by 7% volume growth, higher selling prices related to price actions taken during the quarter to offset raw material inflation and favorable foreign currency impacts. Segment earnings in EMEA increased $8 million or 31% in the second quarter compared to the prior year, primarily due to better top line performance. Lower manufacturing costs related to the closure of our manufacturing facility in Dortmund, Germany also contributed to the improved segment earnings result. Second quarter net sales in the Americas increased 7% year-over-year as 4% higher sales volumes were complemented by favorable impacts from foreign currency and higher selling prices. Higher volumes were primarily the result of new business wins, but also benefited from the resumption of previously idled customer production, along with some new capacity coming online in our metals business. Segment earnings in the Americas decreased $2 million or 3% in the second quarter compared to the prior year as better top line performance was offset by higher manufacturing and operational costs. Turning to nonoperating costs. Our interest expense was $10 million in the second quarter of 2026, which was consistent with the previous quarter, while our cost of debt decreased to approximately 4.4%, reflecting the benefits of our refinancing actions and a more optimized debt portfolio. Our effective tax rate, excluding noncore and nonrecurring items, was approximately 28% in the second quarter, which was in line with the previous quarter and our full year target range of 28% to 29%. Finally, our second quarter GAAP diluted earnings per share were $1.55, and our non-GAAP diluted earnings per share were $2.19, a 28% increase over the prior year due to improved operating performance and lower interest expense as a result of reduced borrowings. Cash generated from operations was $29 million in the second quarter, decreasing from $42 million in the prior year. The lower cash generation in the current year is driven by higher working capital outflows resulting from increased sales volume and increased inventory associated with closing our facility in Dortmund and opening our new facility in China. These items were partially offset by improved operating performance. Capital expenditures in the second quarter were $10 million, primarily related to the construction of our new facility in China. For the full year, we expect 2026 capital expenditures to be approximately 2.5% to 3% of sales. During the second quarter, we announced the approval of a new $250 million stock repurchase authorization that replaces our previous repurchase program and recently announced an increase in our quarterly dividend of 4.3%. We also repurchased approximately $24 million worth of shares and paid approximately $9 million in dividends, returning a total of $33 million of cash to shareholders in the second quarter. Together, our share repurchase activity and increased quarterly dividend reflect our confidence in the strength and durability of our cash flow generation and underscores our commitment to return capital to shareholders through a balanced and disciplined capital allocation strategy. We delivered strong second quarter results, driven by continued share gains, disciplined execution of our pricing actions and broad-based growth across all regions. Our team executed effectively in an uncertain environment, leveraging our global footprint, pricing actions and our operating discipline to deliver record profitability. With a strong balance sheet, enhanced financial flexibility and continued progress on our transformation initiatives, we remain well positioned to execute our strategy and create long-term value for our shareholders. With that, I will turn it back over to Joe. Joseph Berquist: Thank you, Tom. To close, our record second quarter results reinforce the strength of our business model and our ability to consistently outperform our end markets despite macro disruptions and uncertainty. While the external environment remains dynamic, we are confident in our approach and our ability to continue creating value for customers and shareholders and the opportunities ahead in the second half of the year. With that, we will be happy to answer your questions. Michael Harrison: Congrats on a nice quarter. I was hoping that maybe we could start, just getting a little bit more color on what you guys are seeing on the raw material front. I'm curious what specific raw material baskets are moving higher or continuing to show a lot of volatility. And really interested in understanding the timing of the P&L impact to the extent you can help us quantify how much raws were up in Q2 and what the expectation is for inflationary impact in Q3 and Q4, that would be very helpful. Joseph Berquist: Yes. Good question, Mike. So overall, if you think about our raw material buckets, there's kind of three buckets, right? The things that are related to base oils or derivatives of crude the additives, which tend to be closely linked to that and then the oleo chemicals. And I would say the base oil related, crude related, is about 2/3 of our bucket remains pretty volatile. It's, as I mentioned in the comments, at that elevated range right now. And that's -- it's kind of like the new normal, right, is this volatility in the elevated range. There is a little bit of softening on the oleo chemicals and things that are delinked from that, and it tends to be more regional impacts overall. Raw material container costs, pretty significant for us in the quarter. We think that those impacts really peaked in June and even early this month in July. As we go forward, I think there's different elements at play, right? We have certainly pricing that came on during the quarter. We have index adjustments that happened at the end of the quarter and even in the middle of this quarter. And there's also the inventory movements. I mentioned that in the comments as well. What that means is as the cost of the inventory changes, we revalue that inventory and there tends to be a capitalization effect for a couple of months as that moves through. So what I would say, as we've modeled this out, we think gross margins are going to be pretty flat, quite frankly, in Q3 from Q2 and then improving hopefully toward the end of the quarter and into Q4. Michael Harrison: All right. And then just on the volume front, Asia has been strong, and so I don't think that was a huge surprise, but EMEA was surprisingly strong. I was hoping maybe for both regions, you can talk about the sustainability of the strength that you're seeing. Joseph Berquist: Yes. I mean the underlying markets in EMEA were -- steel was up and industrial production was up slightly. But conversely, the auto ICE production, we think, was down double digits, mid-teens. So in composite, we'll say market was flat to slightly up. Most of the growth that we're seeing is really what I would call self-help. It's the share gains that we've been delivering from our pipeline. They were on the higher end of our range. So I would say slightly above that kind of 4% high end of the target range for us. How sustainable is that for us? I mean I think remaining within that 2% to 4% range is something we're pretty confident that we'll continue to do. And then anything that happens in the market outside of that would bolster that growth rate. But a lot of new business wins in that region. And we've been talking about share gains over the past several quarters, and we're starting to see the impact of that. In EMEA, in the second quarter, early in the quarter, April was a busy month. We do think that region, in particular of the three different segments for us, had some prebuy. So I would say half to 2/3 of the growth in the quarter was from share gain with that remaining half to 1/3 to 1/2 from prebuy. But we're through kind of the early part of Q3, and demand has remained pretty steady in Europe. So we think most of that impact -- it wasn't a huge impact on the quarter. Let's just say that. And we think that the demand environment in EMEA has remained pretty steady. We're entering into traditionally, the holiday period in August is a very slow time, but then usually that recovers in September. For Asia Pac, I mean, Asia Pac, some softness really in that market. So it really accentuates, kind of, the double-digit volume growth that we're getting there. It's coming from share gain. It's coming from winning new lines, whether that's in the metal space or the metalworking space. We've talked about how important it's been for us to gain share with the electric vehicle manufacturers in that part of the world. Do I expect us to continue to take share in double digit? I would love to say that was true, Mike. I think it will probably normalize at some point in that mid-single-digit range. But we've got a very good team there that's executing on the ground. We just opened a new plant in China. We're doing very well in India and other parts of Asia. So that will be, I think, a growth engine for us for several foreseeable quarters as far as I can tell right now. Michael Harrison: All right. And then my last question is on Americas operating margin. You were down 250 basis points year-on-year and referenced some higher manufacturing and operational costs. I'm just wondering if you can help us understand a little bit more between those operational issues and raw materials and pricing and maybe any volume leverage or cost actions you're taking. Help us understand the puts and takes around Americas margin and how we might think about that trending into the second half? Joseph Berquist: Yes. I do think -- so second quarter, specifically, we had some inventory disposal costs related to quality related to kind of things we're working through at one of our plants. On the flip side, good problems to have. I think we had some higher inventory as we work off backlog and we're trying to catch up some of our grease orders. And then one of our primary plants there in Middletown, we've gone to a 24/7 operation right now. And so we will see some ongoing higher costs in the Americas. However, I think there was a little bit of onetime nature on the operational side in the Americas in the quarter. So I would expect that to improve. And overall, operating margins should return to where they've been traditionally for that region. Peter Osterland: So I just wanted to start by following up on the margin performance, particularly with the drop-off for gross margins less severe than what you anticipated a quarter ago. I guess to what extent did this reflect faster or higher-than-expected pricing implementation? And thinking about the second half, do you now see upside to the 36% to 37% range that you've talked about exiting the year at as you continue to implement pricing in the back half? Joseph Berquist: Don't necessarily -- we're not modeling upside, Pete, and thanks for the question. I think what we kind of mentioned it before, there's this inventory valuation aspect that's a little bit of an accounting exercise, but the timing of how the prices roll into our costs and how those costs work their way through the system. We did a good job with pricing. We certainly didn't get all the pricing that we wanted to get, and there's still some pricing that will come on. One of the key things is the volume. We modeled a 200 to 300 basis point kind of impact to gross margins in Q2. The volume was a nice surprise for us, right? And that capacity utilization in our plants was helpful. We're also starting to see the benefits of plant closures, right? We made a decision to close a plant in Europe, and you saw the Europe operating margins improve in the quarter. So it's a mix of different things. I do -- I firmly believe that we will be above that 36% gross margin by the end of the year. We say our target range is 36% to 37%. There have been times in the past in deflationary environments where we can see expansion of our gross margins higher than that. And would it surprise me if that happened? No, but it's not something we're anticipating right now. Peter Osterland: Very helpful. And then also just wanted to ask a follow-up on capital allocation. Following your recent buyback authorization and some of that repurchase activity kicking in here in the second quarter, how should we think about your plans for the cadence of buybacks this year? How are you currently weighing share repurchases against the potential you see to execute on additional bolt-on M&A? Tom Coler: Yes. This is Tom. Thanks for that question, Pete. I would say we continue to have really good flexibility from a capital allocation standpoint with the new share repurchase authorization. We just refinanced our credit facility and have added some capacity there as well. First and foremost, we want to deploy capital to help the business grow, whether that's through organic investments like our new plant in China or inorganic opportunities through continuing to work our M&A pipeline. So I think we'll continue to be opportunistic as we think about share repurchases, balance that with dividend payments. We just announced that we increased our dividend 4.3% coming earlier this week. And so again, we're going to use all the tools in the toolkit and continue to have a balanced approach. But first and foremost, primarily, we want to deploy capital to grow. Daniel Rizzo: It's actually Dan Rizzo on for Laurence. Just getting back to kind of the Asia share gains that you guys are kind of doing. I was wondering if that's like a lot of singles or some -- meaning that there's a lot of smaller new wins? Or is it a couple of customers where you're getting really great penetration and how that should look moving forward? Joseph Berquist: Yes. Thanks for the question, Dan. It's really broad-based in Asia. China is the biggest aspect, biggest country of the Asia, but landscape, but really, our growth in India has been very good as well as Southeast Asia. So -- and it's across all product lines. So I think it's a lot of singles and doubles. When you get a new mill that comes online, for instance, a new cold rolling line in China this past year, we were able to get our fluid intelligence equipment on that line. And it's pretty big. So every now and then you have a triple, right? But to the nature of your question there, I think it's broad-based. It's not coming from just a handful of things. It's really across the industrial sectors and across the geographic landscape in that region. Daniel Rizzo: So -- and with that, say that the new fluid intelligence at a new plant, is that kind of the toehold and then over the next few years, you should penetrate more? I mean is that kind of how it works like this is the way in and then we take it from there. I mean, am I thinking about that right that it could -- I guess, what I'm trying to ask is it could accelerate with each plant as you just get a foothold in it? Joseph Berquist: I mean that's the design, right? We're -- it's really an enhancement of our service model. And when you're -- when it works as well as it does in the rolling applications, if you're building a new line, right, if a new mill is coming on, we're in touch with not only the OEMs, but also the equipment manufacturers. And it's a way to really control how our fluids are used on those lines so they work very efficiently and give the customers a lot of control over their system, as well as insights how to optimize fluid application with their production processes. So we continue to work on innovation in that area. It's not just a steel rolling or aluminum rolling offer for us. We certainly have a metalworking offer as well, and we're seeing some penetration on that side. And we expect that to be a real core part of our offer across the business as we go forward. So I do anticipate you will see that, Dan. Daniel Rizzo: And then you mentioned India versus China. I would assume then that India actually offers more opportunity with more new plants and more new metalworking or steel rolling plants coming online there versus China, which I guess would be a little bit more mature at this point. Is that accurate as well? Joseph Berquist: Yes and no. I mean I think you're seeing in China, you're still seeing a lot of growth on the -- with the electric vehicle segment. So whether that's die casting, electrical steel, all the way through, and there's a lot of line refreshes that are happening there. The overall growth might be decelerating because of -- on a comparative basis, just because of the size of that market, how big it is, but it's not stagnant. And you're right in pointing out that India is growing differentially. There is I guess, the ballpark figure that people have thrown around is that industrial production there is supposed to double between sort of 2020 and 2030 or 2035, and it seems to be on that pace. There is a lot of new production in that part of the world. And so we're happy to grow as that new production comes online. That's certainly a tailwind for our business. Jonathan Tanwanteng: I was wondering if you could just talk about the expectation for share gain and new business wins going forward. I think you've been at or above the high end of your 2% to 4% target range for over a year now, and you're lapping some of that acceleration. What's the competitor dynamic or response given that your business trends are pretty sticky there? And should we recalibrate our expectation of your ability to continue gaining share as you continue to do that? Just help us out with the thoughts on the target range. Joseph Berquist: Yes. Good morning, Jon. I mean we -- that target range is something that we consider very carefully. Our sales cycle is not a quick sales cycle, usually to get a piece of business. It could be on the short side, 3 months. It could be on the long side a year or longer. And I do think we've had a good run here, right, for the past several quarters. Why is that happening? I think it's a combination of things. Cross-selling, we've been acquisitive, and we brought on some new technology that adds to our portfolio and increased the size of our addressable market. So we're going into existing customers who are happy with us and saying, "Hey, we have some additional things you can buy from us now," and that does help accelerate that sales cycle. I also think it's things like just really having a very strong team, a local-for-local model in parts of the world like China, like India that are growing faster and taking advantage of that. It's also leveraging things like our fluid intelligence play. I mean we won some business here in Europe and the Americas this year with some customers that were pretty hard to crack by going in with an enhanced service model around our fluid intelligence equipment, and that got us in the door, and we're able to then convert that new business. So we will certainly drive. We incentivize our people, everyone in the company, including myself, is compensated based upon targets around net share gains. So reducing churn and increasing share gains. So we're all very, very focused on it. The other piece, Jon, I think that's maybe helped us just from a math perspective over the past few quarters is, we did go through a couple of year period there where we had higher churn, right? And we've got that churn number down the low single-digit area where it's been historically. So when we stop the bleeding on that end, we're able to show a little bit more on the growth side. Jonathan Tanwanteng: Got it. And if you could just drill a little bit more down into the Fluid intelligence piece. How big is that business today? And are you seeing momentum accelerating there? What's the growth rate? Joseph Berquist: I mean it's hard to say how big the business is. I think when you look at -- how we measure it, we're not really measuring equipment sales. We're measuring the amount of fluid sales that are tied to a fluid intelligence offer, right? And so I would say right now, it's somewhere between 10% and 20% of our revenues have some sort of fluid intelligence component that's part of the service aspect. How big can it be? How big will it be going forward? We want it to penetrate across the entire business, and we want to use it as a growth engine to penetrate into customers that we don't have today. So I'll just say our ambitions are high there. Jonathan Tanwanteng: Got it. And one follow-on to that. Just -- are the margins associated with Fluid Intelligence higher than your fleet average, just given the way the equipment works and the personnel you dedicate to it? Joseph Berquist: Not necessarily, not necessarily. Again, I think it's a way -- it's a digitized service model. So it doesn't replace our people, but we're really focused on the product sale, and it really enables that product sale for us. And I think that our margin profile is pretty consistent around the world. David Silver: So apologies, this might be kind of a little -- take a little time to get out. But I was kind of -- along with your very strong results this quarter, I would call out maybe the incremental margin performance. I mean, growth in operating income or EBITDA relative to the growth in sales. And I'm thinking that 7% volume growth largely from new business wins, I mean that does strain your skilled labor force to a certain extent. And I'm just wondering if from your perspective, Joe, you're able to handle continued quarters at this, let's say, high -- mid- to- high single-digit new business win pace with kind of what I would call your installed base. In other words, I guess under your predecessor, there was some volume erosion, and it's not apples-to-apples, but you are regaining that volume now. And should I look at some of the very attractive incremental margins that you're reporting now is kind of a sense that maybe your skilled labor force was a little bit underutilized and you were able to take on a fair amount of new business without meaningfully staffing up or adding incremental resources. And if that's the case, I mean, how much more -- I don't want to call it slack, but how much more kind of capability do you think you have here before you would have to meaningfully invest in either new talent or other new resources to service your growing customer base? Joseph Berquist: Yes. Thank you. It's a really great question, honestly. I think we went through a period, and we're still kind of going through a period where because of the complexity of our systems, master data, just a complex network in our manufacturing space, our skilled labor, right, our subject matter experts that are touching the customer probably spent too much time on internal things, right? And in the last 18 months, that's been kind of my battle cry to make sure that we spend more time doing business with our customers than we do amongst ourselves. So Tom and I and the rest of the team are really focused on making sure that we're reducing that complexity. We're freeing up people to spend more time with customers. And in the meantime, making very meaningful improvements to our business processes, our master data, our ERP system, just kind of cleaning things up on the back end so our people on the front end can work more effectively. And I think that's working well for us. And we have capacity in our team to do those things. Long term, I mean, I want to continue to invest in those subject matter experts because ultimately, it's our people that are the biggest difference. It's our service model. And I think we probably got a little bit heavier in the functional areas, and we got a little bit lighter in the commercial areas. And just as a general philosophy, I'm focused on flipping that equation, right? I want us to make sure we're investing and nurturing those -- that commercial talent and becoming more efficient in our back-office area. So it frees up our people to sell to our -- and serve our customers. Tom Coler: Yes. And I would just add to that, David. We've got ample production capacity in terms of our manufacturing network at this point to meet the needs of our customers. Joe talked about cost and complexity reduction and focusing our commercial organization. This is all sort of focused on what Joe and I have talked about, which is driving EBITDA margins to 18% over time. A portion of that is top line growth in scale and a portion of that is cost and complexity reduction, which we've talked about on the Q1 call relative to our transformation initiatives. So I think we've got the opportunity to continue to drive leverage in the P&L, and that's our goal. Joseph Berquist: Yes, we're saying sustainably above 18%, right? So if you look at where we've been kind of running, that's a 200 basis point plus near-term goal for us to get at, and we feel like we have a line of sight to do that. David Silver: I'll have to relisten to that another couple times on replay. But no, I appreciate all the depth there. I did want to go back to the, I guess, capital allocation or share repurchase question. And I guess there's just a lot of moving parts. You're repurchasing shares at a level well above displacing, I guess, any options-related issuance. Your debt did rise a little bit sequentially. You raised your dividend, et cetera. But just thinking about the share repurchase activity level in light of the new authorization, et cetera. Should I look at the $24 million that was spent here in this quarter as something more opportunistic in nature? Or is this something that we should think about as programmatic? In other words, with the new authorization and your healthy cash flow, I mean, does opportunistic -- do you consider opportunistic share repurchase at, let's say, the current price, a core part of your capital deployment strategy? Or is it more of, I don't know, like a flywheel dependent on M&A opportunities and some other things? Tom Coler: Yes. Good question, David. Yes, I would go back to sort of our overall capital allocation philosophy, which is, first and foremost, invest for growth, whether it's organic or inorganic. You used the word opportunistic. I think that's the way that we think about share repurchases as well as we sort of evaluate where our capital structure is, where our leverage ratio is, what we see relative to our M&A pipeline or internal investments and then how we think about balancing all those pieces. I wouldn't characterize it as programmatic. I would say it is opportunistic and the new repurchase authorization that we have really just gives us the flexibility to be opportunistic as it makes sense in the market. Adam Hamilton: This is Adam on for Arun. My understanding is that gross margin outperformance was mostly on volumes for the quarter, but maybe if we could double-click on price a bit. It seems like you're doing quite a good job at pushing that through to offset inflation. So I guess I have two quick questions on that. How much of the price you've already implemented has yet to flow through in third quarter? And how much of your year-over-year growth do you think is mostly from the outperformance in the first half? Meaning how much do you think you're going to have some of this flow through in the second half versus purely in the second quarter? Joseph Berquist: Yes. So let's talk about the gross margin piece first and the pricing piece first. The majority of the pricing has flown through, right? Because the prices have stabilized at these high levels. And the delay, I guess, has been we have a few index adjustments that are just time-based and they come at the beginning of a new quarter or middle of a quarter sometimes. So I would say we don't expect much more in the short term from a net selling price per kilo expansion unless the external environment dictates that we have to do that. And hopefully, it doesn't. But if it does, we'll go and get it. I think you're asking second quarter was a really good volume quarter. It was a good quarter for us overall. Is that sustainable? I mean we see -- as I said in the comments upfront, I think the third quarter will probably look very closely like second quarter. Traditionally, third quarter tends to be a good quarter for us. The second half of the year tends to be a little bit better for us than the first half of the year. That growth -- the Asian markets, for sure, in the second half of the year have traditionally been better than the first half. Europe will be tough, right, in the month of August, and they may walk back a little bit in Q3, but we're seeing some relative strength in the Americas right now, and we're pretty confident that demand will hold up that we would see a third quarter pretty similar to what we saw in the second quarter. And then the question becomes what happens in the fourth quarter. With all the volatility in the world right now, I don't really want to go that far down the road, but I think we're tracking on this sort of mid-single-digit to high single-digit EBITDA growth for the full year. Adam Hamilton: Okay. Great. And maybe if we could go back to the bolt-on piece. It kind of sounds like you're saying that India and China are consistently providing the most opportunity for maybe acquisition potential. How are you thinking about that in terms of end markets? And I know there are several kind of reasonably depressed end markets like building construction, et cetera. So how are you thinking about acquiring things at discounted multiples to bring in accretive bolt-ons versus bringing things in that are not necessarily at their growth part of the cycle? Or is that not how you're thinking about it at all and you're more concerned with the sort of the cross-selling and synergistic piece? Joseph Berquist: No. I mean it's -- so I think you captured pretty well the variables, right, that we consider. So when we're talking about bolt-ons, we're looking for -- we're either going to look for something that's a portfolio addition, right, or some IP or a capability that we don't have today. A capability could be technical capability or access to markets or certain channel play. So those are things that we consider. I think we're not necessarily looking to go out and get into things. We help people manufacture things out of metal, right? So if there are parts of the portfolio and value chain today that we don't have or we don't have everywhere, then we would be looking at strengthening our portfolio, adding those capabilities. There's also, as you said, periodically, there are some things that come along that you would look at purely from a synergy standpoint. It's a pretty fragmented space. There are a lot of regional players, small players in those regions. And if you can go and get something and get some arbitrage on the multiple, then we've done that successfully in the past and would certainly consider doing that in the future. And then we always -- we leave dry powder. We position ourselves to be able to do something more transformational, a larger type of deal. Of course, those are rare, and they take a lot of time to get done. But that's sort of the overall landscape there, Adam. Tom Coler: Yes. And I would just add that we have a track record of buying good businesses, EBITDA positive, cash flow positive businesses that are accretive to our business. And we look at those opportunities, as Joe said, through the lens of a commercial channel or a new product technology or an asset and bringing that into our large global footprint with all of our capacity and capability to accelerate growth in those acquisitions that we've made. So I think that's how we think about our philosophy from a -- sort of a financial standpoint. Joseph Berquist: Sure. Thank you. Thank you for joining us today. We appreciate everyone's continued interest in Quaker Houghton. And I also just want to thank our colleagues around the world for their hard work and dedication to our customers. Our people are our greatest asset. Please reach out to John if you have any additional follow-up questions. Thank you. Operator: This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation. Before you buy stock in Quaker Chemical, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Quaker Chemical wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $397,405!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,344,091!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of August 7, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Quaker Chemical (KWR) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Quaker Chemical Corporation KWR posted second-quarter 2026 net earnings of $26.8 million or $1.55 per share, up sharply from a loss of $66.6 million or $3.78 per share in the year-ago quarter. Barring one-time items, adjusted earnings increased 28.1% year over year to $2.19 per share. It beat the Zacks Consensus Estimate of $1.68 per share. Revenues rose 10.2% year over year to $532.6 million, driven by higher sales volumes, favorable foreign currency translation and improved selling price and product mix. Sales surpassed the consensus estimate of $511.8 million. Sales volumes increased 7% year over year, primarily reflecting new business wins across all segments. Adjusted EBITDA advanced 12.8% to a record $85.2 million, supported by higher sales, partly offset by increased SG&A expenses.  Consolidated sales growth included a 7% contribution from volumes, a 2% favorable currency impact and a 1% benefit from selling price and product mix. Underlying end-market activity was similar to the prior-year period, while new business wins drove share gains across all regions. Quaker Houghton price-consensus-eps-surprise-chart | Quaker Houghton Quote Americas revenues increased 7% year over year to $236.5 million, above the consensus estimate of $232.9 million. The improvement reflected 4% higher sales volumes, a 1% benefit from selling price and product mix and a 2% favorable currency impact. Segment operating earnings declined to $57.2 million from $59 million due to higher raw material costs and SG&A expenses. EMEA sales rose 13% year over year to $158.4 million, topping the consensus estimate of $147 million. Sales volumes increased 7%, selling price and product mix added 4% and foreign currency translation contributed 2%. Segment operating earnings climbed to $32.7 million from $25 million on higher sales and improved margins.  Asia/Pacific revenues increased 12% year over year to $137.6 million, exceeding the consensus estimate of $130.8 million. Sales volumes advanced 10%, while pricing and currency each added 1%. Segment operating earnings rose to $36.6 million from $28.7 million, driven by stronger sales despite some margin pressure. Cash and cash equivalents were $155.1 million at the end of the second quarter compared with $179.8 million at the end of 2025. Total gross debt was $876.1 million, resulting in net debt of approximately $721 million.  Net cash provided by operating activities was $33.2 million for the first six months of 2026 compared with $38.5 million in the prior-year period. The decline reflected higher working-capital outflows, partly offset by improved operating performance and lower restructuring-related cash outflows.  The company invested $21 million in property, plant and equipment during the first half of 2026. In the second quarter, it repurchased approximately $24.2 million of shares and announced a new $250 million stock repurchase program.  Net leverage remained approximately 2.3x trailing 12-month adjusted EBITDA. The company also increased its quarterly dividend by roughly 4.3%. Management expects stable demand entering the third quarter, with end markets projected to remain flat to slightly positive through the rest of 2026. Continued share gains are expected to support volume growth despite macroeconomic and geopolitical uncertainty.  Quaker expects the gross margin percentage in the third quarter to remain near second-quarter levels as it works through raw material cost inflation, inventory movements and the timing of price recovery actions. Management said pricing and cost initiatives should allow the company to exit 2026 within its target gross margin range.  The company continues to expect meaningful revenue and adjusted EBITDA growth in 2026, supported by new business wins, disciplined cost management and the resilience of its global network.  Management remains focused on operational execution and shareholder returns while navigating raw material inflation and market volatility. KWR shares have gained 37.1% in the past year compared with the industry's 5.6% rise. Image Source: Zacks Investment Research KWR currently carries a Zacks Rank #2 (Buy). Other top-ranked stocks in the Basic Materials space include Almonty Industries Inc. ALM, Neo Performance Materials Inc. NOPMF and Skeena Resources Limited SKE. Almonty is expected to report second-quarter results on Aug. 13. The Zacks Consensus Estimate for ALM’s second-quarter earnings is pegged at 10 cents per share. It carries a Zacks Rank #2 at present. NOPMF is slated to report second-quarter results on Aug. 11. The Zacks Consensus Estimate for earnings is pegged at 50 cents per share. NOPMF has a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here. Skeena Resources is expected to report second-quarter results on Aug. 13. The Zacks Consensus Estimate for SKE’s second-quarter loss is pegged at 11 cents per share. It currently carries a Zacks Rank #2. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Quaker Houghton (KWR) : Free Stock Analysis Report Skeena Resources Limited (SKE) : Free Stock Analysis Report Almonty Industries Inc. (ALM) : Free Stock Analysis Report Neo Performance Materials Inc. (NOPMF) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Achieved record quarterly adjusted EBITDA and 7% volume growth, primarily driven by broad-based net share gains that exceeded the company's target range. Navigated significant raw material inflation and supply chain disruptions caused by the Strait of Hormuz conflict through global network flexibility and proactive customer communication. Asia Pacific delivered double-digit volume growth for the second consecutive quarter, fueled by penetration into the electric vehicle OEM and component manufacturing sectors. The Americas region saw a recovery in volume as previously idled customer capacity returned to operation and recent business wins began contributing to the top line. Management attributes outperformance to 'self-help' initiatives and a strong commercial pipeline rather than underlying market growth, which was estimated to be flat to slightly positive. Successfully launched a new manufacturing facility in Zhangjiagang, China, to enhance the 'local-for-local' operating model and reduce reliance on imports. Implemented a business transformation and cost optimization program expected to deliver $10 million in run-rate savings, focusing on process simplification and footprint optimization. Anticipates third quarter performance to be roughly in line with the second quarter, assuming no major market disruptions and normal seasonal patterns. Expects gross margins to remain flat in the short term due to inventory valuation timing before returning to the target range of 36% to 37% by year-end. Projects raw material input costs will remain stable at elevated levels in the near term with potential moderation in the latter half of the year. Maintains a long-term strategic goal of achieving sustainable adjusted EBITDA margins above 18% through scale, cost reduction, and complexity management. Full-year 2026 guidance forecasts meaningful revenue growth and mid- to high single-digit adjusted EBITDA expansion. Identified potential seasonal headwinds in Europe for Q3 due to extended summer shutdowns and unseasonably high temperatures impacting customer operations. Noted that while some customer pre-buying occurred early in Q2 due to Middle East tensions, it was not considered a significant driver of the quarter's total volume. Completed the closure of a manufacturing facility in Dortmund, Germany, which contributed to improved segment earnings in EMEA through lower manufacturing costs. Acknowledged temporary margin pressure in the Americas due to one-time inventory disposal costs and higher operational expenses from moving a primary plant to 24/7 operations. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management explained that base oil and crude-related derivatives, representing two-thirds of the raw material basket, remain highly volatile. Gross margins are expected to be flat in Q3 due to the capitalization effect of revaluing inventory as higher-cost materials move through the system. Pricing adjustments and index-based recoveries are expected to fully manifest by the end of the year. Growth is driven by winning new lines in metalworking and electric vehicle sectors in China, India, and Thailand. While double-digit growth may eventually normalize to mid-single digits, the new China plant and expansion in India provide a multi-quarter growth engine. Approximately 10% to 20% of revenues are now tied to a Fluid Intelligence component, which serves as a 'digitized service model' to win difficult accounts. The technology acts as a foothold to secure long-term fluid sales by helping customers optimize application and production processes. Management characterized the $24 million in Q2 share repurchases as 'opportunistic' rather than programmatic. Primary capital priority remains organic and inorganic growth, with the company actively evaluating bolt-on acquisitions that offer new IP or market access.

This article first appeared on GuruFocus. Net Sales: $533 million, a 10% increase year-over-year. Sales Volumes: Increased 7%, driven by global net share gains. Gross Margin: Declined to 35.5% due to higher raw material costs. Adjusted EBITDA: $85 million, a record quarterly result, with margins of 16%. Adjusted EBITDA Margin: Increased 40 basis points year-over-year and 90 basis points sequentially. GAAP Diluted EPS: $1.55. Non-GAAP Diluted EPS: $2.19, a 28% increase year-over-year. Cash from Operations: $29 million in the second quarter. Capital Expenditures: $10 million in the second quarter. Asia Pacific Segment Sales: Increased 12% year-over-year, with 10% organic volume growth. EMEA Segment Sales: Increased 13% year-over-year, with 7% volume growth. Americas Segment Sales: Increased 7% year-over-year, with 4% higher sales volumes. Segment Earnings (Asia Pacific): Increased approximately $8 million or 27% year-over-year. Segment Earnings (EMEA): Increased $8 million or 31% year-over-year. Segment Earnings (Americas): Decreased $2 million or 3% year-over-year. Interest Expense: $10 million, consistent with the previous quarter. Effective Tax Rate: Approximately 28% on a non-GAAP basis. Share Repurchases: Approximately $24 million worth of shares repurchased in the second quarter. Dividends Paid: Approximately $9 million in the second quarter. Warning! GuruFocus has detected 2 Warning Sign with ITVPF. Is KWR fairly valued? Test your thesis with our free DCF calculator. Release Date: July 31, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Record quarterly adjusted EBITDA, the highest in the company's 160+ year history, driven by a 7% increase in sales volumes. Broad-based volume growth and net share gains across all regions, with Asia Pacific delivering a second consecutive quarter of double-digit volume growth. Successful navigation of raw material cost inflation and supply disruptions from the Strait of Hormuz conflict, maintaining supply continuity and implementing price increases. Strong capital allocation with a new $250 million stock repurchase authorization, a 4% dividend increase (17th consecutive annual increase), and successful refinancing of the credit facility. Progress on strategic initiatives, including the startup of a new manufacturing facility in China and a cost optimization program expected to deliver $10 million in run-rate savings. Gross margins declined sequentially and year-over-year to 35.5% due to product margin pressure from higher raw material costs. Raw material costs remain elevated and volatile, particularly for base oils, with expectations of stable high input costs in the short term. Automotive light vehicle production remains challenged across most regions, negatively impacting demand in that end market. Americas segment earnings decreased 3% year-over-year due to higher manufacturing and operational costs, including inventory disposal costs and 24/7 plant operations. Cash generated from operations decreased to $29 million from $42 million in the prior year, driven by higher working capital outflows from increased sales volume and inventory. Q: Can you provide more color on the raw material front, specifically which baskets are moving higher, and help quantify the inflationary impact and timing for Q3 and Q4?A: Joe Berquist (CEO): Raw materials related to base oils or crude derivatives, which make up about two-thirds of our basket, remain volatile and at elevated levels. Oleochemicals are softening slightly. Raw material costs peaked in June and early July. We expect gross margins to be relatively flat in Q3 compared to Q2, with improvement expected toward the end of the quarter and into Q4 as pricing actions and index adjustments take effect. Q: Regarding the strong volume growth in EMEA and Asia Pacific, how sustainable is this strength, and what is the breakdown between share gains and market growth?A: Joe Berquist (CEO): In EMEA, underlying markets were flat to slightly up, with most growth coming from self-help share gains that were slightly above the high end of our 2%-4% target range. We believe half to two-thirds of EMEA growth was from share gains, with the rest from pre-buying. Demand has remained steady in early Q3. In Asia Pacific, the double-digit growth is coming from share gains, particularly with electric vehicle manufacturers. While we expect Asia Pacific growth to normalize to mid-single digits, it should remain a growth engine for several quarters. Q: Can you explain the decline in Americas operating margin, which was down 250 basis points year-over-year, and how we should think about it trending in the second half?A: Joe Berquist (CEO): The decline was due to higher manufacturing and operational costs, including inventory disposal costs related to quality issues at one plant, higher inventory to work off backlog, and the transition of our Middletown plant to 24/7 operations. Some of these costs were one-time in nature, so we expect operating margins in the Americas to improve and return to traditional levels. Q: Given the less severe drop in gross margins than anticipated, do you see upside to the 36%-37% gross margin range you've talked about exiting the year at?A: Joe Berquist (CEO): We are not modeling upside, but we firmly believe we will be above 36% gross margin by the end of the year. The better-than-expected performance was driven by strong volumes and capacity utilization, not just pricing. While we don't anticipate exceeding the 36%-37% target range, it wouldn't surprise us if we did in a deflationary environment. Q: How should we think about the cadence of share buybacks this year, and how are you weighing repurchases against potential bolt-on M&A?A: Tom Kohler (CFO): We have good flexibility with the new $250 million repurchase authorization and refinanced credit facility. Our first priority is deploying capital to grow the business, whether organically or inorganically. We will be opportunistic with share repurchases, balancing them with dividend payments and M&A opportunities, using all the tools in our toolkit with a balanced approach. Q: Are the strong share gains in Asia coming from a few large wins or many smaller ones, and how should that look moving forward?A: Joe Berquist (CEO): The growth is broad-based across China, India, and Southeast Asia, and across all product lines. It's mostly "singles and doubles," with occasional larger wins like a new cold rolling line in China where we placed our Fluid Intelligence equipment. This equipment serves as a toehold, allowing us to penetrate further and accelerate growth with each new plant. Q: Given you've been at or above the high end of your 2%-4% share gain target for over a year, should we recalibrate expectations for your ability to continue gaining share?A: Joe Berquist (CEO): We've had a good run due to cross-selling from acquisitions, a strong local-for-local model in fast-growing regions, and leveraging Fluid Intelligence to win hard-to-crack customers. We've also reduced churn to historical low single-digit levels. While we remain confident in sustaining the 2%-4% range, the recent outperformance was partly due to recovering from a period of higher churn. Q: How big is the Fluid Intelligence business today, and are its margins higher than the company average?A: Joe Berquist (CEO): It's hard to size precisely, but 10%-20% of our revenues have some Fluid Intelligence component. We want to penetrate it across the entire business and use it as a growth engine. Margins are not necessarily higher than average; it's a digitized service model that enables product sales and enhances our service offering, but the margin profile is consistent with the rest of the business. Q: Can you handle continued high single-digit new business win pace with your current skilled labor force, or will you need to invest in new talent?A: Joe Berquist (CEO): We've been focused on reducing internal complexity and freeing up our subject matter experts to spend more time with customers. We have capacity in our team and ample production capacity. Our goal is to shift resources from back-office functions to commercial areas, investing in commercial talent while becoming more efficient internally. This supports our long-term goal of achieving EBITDA margins above 18%. Q: How much of the price increases implemented have yet to flow through in Q3, and how much of the year-over-year growth is from first-half outperformance?A: Joe Berquist (CEO): The majority of pricing has already flowed through, with only a few time-based index adjustments remaining. We don't expect much more net selling price expansion unless the external environment dictates otherwise. We expect Q3 to look very similar to Q2, with the second half traditionally better than the first. We're tracking toward mid to high single-digit EBITDA growth for the full year. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Interested in Quaker Houghton? Here are five stocks we like better. Record profitability: Second-quarter sales rose 10% to $533 million, while sales volumes increased 7% and adjusted EBITDA reached a record $85 million. Non-GAAP EPS climbed 28% to $2.19 despite raw-material and container-cost pressure. Broad-based regional growth: Asia-Pacific led performance with 12% sales growth and 27% higher segment earnings, while EMEA sales rose 13% and Americas sales increased 7%. Management attributed volume gains largely to market-share wins, although Americas profitability declined because of higher operating and one-time quality-related costs. Positive outlook and shareholder returns: Quaker Houghton expects approximately $10 million in run-rate savings, maintained its outlook for flat-to-modestly positive end markets and mid- to high-single-digit full-year adjusted EBITDA growth. The company also authorized $250 million in additional buybacks and raised its quarterly dividend 4.3%. Industrial Chemicals: 3 Stocks Poised for Growth in the New Year Quaker Houghton (NYSE:KWR) reported second-quarter results marked by higher sales volumes, record adjusted EBITDA and broad-based share gains, as the company navigated elevated raw-material costs and supply-chain uncertainty tied to the conflict in the Strait of Hormuz. President and Chief Executive Officer Joe Berquist said the company recorded its fourth consecutive quarter of year-over-year profitability growth. Sales volumes rose 7% from a year earlier, helping produce the highest quarterly adjusted EBITDA in the company’s more than 160-year history. Management estimated that aggregate end markets were flat to slightly higher than the prior year, indicating that share gains were a significant driver of volume growth. → Why SK hynix Could Be the Best AI Chip Stock to Buy Now Second-quarter net sales increased 10% year over year to $533 million. Volume growth contributed 7 percentage points, while selling price and product mix added 1 percentage point and favorable foreign exchange contributed 2 percentage points, according to Executive Vice President and Chief Financial Officer Tom Coler. Quaker Houghton generated adjusted EBITDA of $85 million in the second quarter, with an adjusted EBITDA margin of 16%. The margin improved 40 basis points from a year earlier and 90 basis points sequentially, as stronger sales volumes and stable selling, general and administrative expenses as a percentage of sales offset pressure on product margins. → Microsoft Just Flipped the AI Spending Narrative Overnight Gross margin declined to 35.5%, down 130 basis points sequentially, due primarily to higher raw-material costs. Berquist said base oil and crude-related materials, which represent about two-thirds of the company’s raw-material basket, remained volatile and elevated. The company also experienced meaningful container-cost increases during the quarter, which management said appeared to peak in June and early July. The company implemented two rounds of price increases during the quarter, and certain index-based pricing adjustments are expected to take effect during the third quarter. Berquist said management expects third-quarter gross margin to remain roughly in line with the second quarter before improving toward the end of the year. The company continues to target gross margins above 36% by year-end. → Carrier Earnings Could Send the Stock to a New All-Time High GAAP diluted earnings per share were $1.55, while non-GAAP diluted earnings per share were $2.19, up 28% from the prior-year period. The increase reflected improved operating performance and lower interest expense resulting from reduced borrowings. Interest expense was $10 million, while the cost of debt declined to approximately 4.4% following refinancing actions. Asia-Pacific remained Quaker Houghton’s strongest growth region, with sales rising 12% year over year. Organic volume increased 10% for the second consecutive quarter, driven by new business wins in metalworking, including electrical, vehicle OEM and component-manufacturer markets. Segment earnings increased about $8 million, or 27%, from the prior year. Berquist said growth in Asia-Pacific was broad-based across China, India and Southeast Asia rather than concentrated among a small number of customers. He cited continued growth opportunities in electric vehicles, die casting and electrical steel in China, while India is benefiting from rising industrial production and new manufacturing capacity. EMEA sales increased 13%, supported by 7% volume growth, pricing actions and favorable currency effects. Segment earnings rose $8 million, or 31%, aided by better sales performance and lower manufacturing costs associated with the closure of a facility in Dortmund, Germany. Berquist said some customer purchasing in Europe was pulled forward early in the quarter amid concerns over the Middle East conflict, though he characterized the impact as limited. Americas sales rose 7%, including 4% volume growth, supported by new business wins, resumed production at previously idled customer facilities and new metals capacity. However, segment earnings declined $2 million, or 3%, as higher manufacturing and operational costs offset improved sales. Berquist said the region incurred inventory-disposal costs related to quality issues at one plant and faced higher costs while addressing grease-order backlogs, including operating its Middletown plant around the clock. He described some of these pressures as one-time in nature and said Americas margins should improve. The company said actions under its business transformation and cost-optimization program implemented in the second quarter are expected to generate approximately $10 million in run-rate savings. Benefits from those actions were already reflected in second-quarter results. Management reiterated its longer-term goal of achieving EBITDA margins sustainably above 18% through a combination of growth, cost reduction and operational simplification. In June, Quaker Houghton started operations at a new manufacturing facility in Zhangjiagang, China. Berquist said the site will allow the company to manufacture its full portfolio within China, reducing imports of certain products and improving flexibility and responsiveness for customers in Asia-Pacific. Operating cash flow totaled $29 million, compared with $42 million a year earlier, as increased sales volume and inventory associated with the Dortmund closure and China facility opening raised working-capital needs. Capital expenditures were $10 million, primarily for the China project. The company expects full-year capital expenditures to equal approximately 2.5% to 3% of sales. During the quarter, Quaker Houghton repurchased approximately $24 million of shares and paid about $9 million in dividends. The company announced a new $250 million share-repurchase authorization and increased its quarterly dividend by 4.3%, its 17th consecutive annual dividend increase. Coler said share repurchases would be used opportunistically, while the company’s primary capital-allocation focus remains investments in organic growth and acquisitions. Management maintained its outlook for end markets to be flat to modestly positive in the second half of 2026. Berquist said demand had remained healthy in the early part of the third quarter, although seasonal shutdowns and higher temperatures in Europe could weigh on regional activity during August. Improving demand in the Americas is expected to help offset that potential weakness. The company expects third-quarter performance to be in the range of the second quarter, barring market disruptions, and projected meaningful revenue growth and mid- to high-single-digit adjusted EBITDA growth for the full year. Berquist said the company has not experienced significant supply disruptions from the Middle East conflict to date, citing the flexibility of its global manufacturing network and proactive customer communication. Quaker Houghton is a global provider of process fluids, chemical specialties and sustainable solutions for industrial applications. The company develops and supplies metalworking fluids, coatings, and corrosion inhibitors, as well as heat transfer, lubrication and additive products designed to improve productivity and extend equipment life. Its portfolio addresses a range of end markets including automotive, aerospace, defense, energy, mining, agriculture and heavy industry. The company traces its roots back to the founding of Quaker Chemical Corporation in 1918 and Houghton International in 1865. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Quaker Houghton Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for July 2026.

Q2'26 net sales of $532.6 million, an increase of 10% Y/Y Q2'26 net income of $26.8 million and earnings per diluted share of $1.55 Sales volumes increased 7% Y/Y primarily driven by new business wins across all segments Q2'26 non-GAAP net income of $37.9 million and non-GAAP earnings per diluted share of $2.19, a 28% increase Y/Y Delivered Q2'26 adjusted EBITDA of $85.2 million, a 13% increase Y/Y Increased quarterly dividend by approximately 4.3% and repurchased $24.2 million of shares in Q2'26; announced new $250 million stock repurchase program CONSHOHOCKEN, Pa., July 30, 2026 /PRNewswire/ -- Quaker Houghton ("the Company") (NYSE: KWR), the global leader in industrial process fluids, announced its second quarter 2026 results today. Second Quarter 2026 Consolidated Results Net sales in the second quarter of 2026 were $532.6 million, an increase of 10% compared to $483.4 million in the second quarter of 2025. This increase was primarily driven by an increase in sales volumes of 7%, a favorable impact from foreign currency translation of 2%, and an improvement in selling price and product mix of 1%. The increase in sales volumes compared to the prior year was primarily the result of net new business wins across all segments. The Company reported net income in the second quarter of 2026 of $26.8 million, or $1.55 per diluted share, compared to a net loss of $66.6 million, or $3.78 loss per diluted share, in the second quarter of 2025. Excluding non-recurring and non-core items in each period, the Company's non-GAAP net income and non-GAAP earnings per diluted share were $37.9 million and $2.19, respectively, in the second quarter of 2026 compared to $30.0 million and $1.71, respectively, in the second quarter of 2025. The Company generated adjusted EBITDA of $85.2 million in the second quarter of 2026, an increase of approximately 13% compared to $75.5 million in the second quarter of 2025, primarily driven by the increase in net sales, partially offset by higher SG&A expenses. See the Non-GAAP Measures and Reconciliations section below for additional information. Joe Berquist, Chief Executive Officer and President, commented, "We achieved our fourth consecutive quarter of year-over-year profitability growth in Q2 2026, resulting in record adjusted EBITDA. Net sales increased 10% against prior year, driven by strong share gains and pricing during a period of significant raw material inflation. Volume growth reflected new business wins across all regions that exceeded the high end of our target range, while underlying markets were flat to slightly positive. Demand has remained steady against the backdrop of the conflict in the Strait of Hormuz, and we have observed selective areas of market growth. We experienced modest pre-buy activity from our customers early in the period in reaction to the conflict, with normal seasonal patterns returning by the end of the quarter. I'm proud of our team's ability to maintain reliable supply to our customers despite heightened volatility. Looking ahead, we expect stable demand trends entering the third quarter with flat to slightly positive end markets throughout the remainder of the year. We anticipate gross margin percentage to stabilize in the third quarter in the range of second quarter gross margins as we work through the timing of raw material cost inflation, inventory movements and price recovery actions. Our pricing and cost initiatives have kept us on track to exit the year within our target gross margin range. We anticipate meaningful revenue and adjusted EBITDA growth in 2026 supported by continued share gains, disciplined cost management, and the resilience of our global network." Second Quarter 2026 Segment Results The Company's second quarter of 2026 operating performance for each of its three reportable segments: (i) Americas; (ii) EMEA; and (iii) Asia/Pacific, is further described below. The following table summarizes the sales variances by reportable segment and consolidated operations in the second quarter of 2026 compared to the second quarter of 2025: Net sales in the Asia/Pacific segment increased 12% in the second quarter of 2026 compared to the same period in 2025, as a result of an increase in sales volumes, an increase in selling price and product mix, and a favorable impact of foreign currency translation. Net sales in the EMEA segment increased 13% in the second quarter of 2026 compared to the same period in 2025, due to an increase in sales volumes, an increase in selling price and product mix, and a favorable impact of foreign currency translation. Net sales in the Americas segment in the second quarter of 2026 increased 7% compared to the same period in 2025, due to an increase in sales volumes, an increase in selling price and product mix, and a favorable impact of foreign currency translation. Underlying end market activity in the second quarter of 2026 was similar to prior year levels, while strong new business wins across all segments led to year-over-year volume growth compared to the prior year quarter. The increase in selling price and product mix in the second quarter of 2026 compared to the same period in 2025 reflects pricing actions taken to offset higher raw material costs, as well as changes in the mix of products and services, and the impact of our index-based customer contracts. Consolidated net sales increased approximately 11% compared to the first quarter of 2026, driven by an increase in sales volumes and an increase in selling price and product mix across all segments. Segment operating earnings increased in the EMEA and Asia/Pacific segments in the second quarter of 2026 compared to the prior year period primarily due to the improvement in net sales and an improvement in segment operating margins, partially offset by an increase in SG&A expenses. Segment operating earnings decreased in the Americas segment in the second quarter of 2026 compared to the prior year due to higher raw material costs and SG&A expenses, partially offset by an increase in net sales. Segment operating earnings increased in all three segments in the second quarter of 2026 compared to the first quarter of 2026, primarily driven by an increase in net sales in all three segments and improved operating margins in the EMEA segment, partially offset by a decrease in operating margins in the Asia/Pacific and Americas segments. Cash Flow and Liquidity Highlights Net cash provided by operating activities was $33.2 million for the six months ended June 30, 2026, compared to net cash provided by operating activities of $38.5 million for the same period in 2025. The Company's decrease in operating cash flow year-over-year primarily reflects higher net cash outflows from working capital, partially offset by improved operating performance and lower outflows from restructuring activities. As of June 30, 2026, the Company's total gross debt was $876.1 million and its cash and cash equivalents was $155.1 million, which resulted in net debt of approximately $721.0 million. The Company's net debt divided by its trailing twelve months adjusted EBITDA was approximately 2.3x. In the second quarter of 2026, the Company announced a new share repurchase program authorizing the Company to repurchase up to an aggregate of $250 million of Quaker Chemical Corporation common stock, which replaced the 2024 Share Repurchase Plan and has no expiration date. In the second quarter of 2026, the Company repurchased 170,568 shares for approximately $24.2 million. Non-GAAP Measures and Reconciliations The information in this press release includes non-GAAP (unaudited) financial information that includes EBITDA, adjusted EBITDA, adjusted EBITDA margin, non-GAAP operating income, non-GAAP operating margin, non-GAAP gross profit, non-GAAP gross 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, non-GAAP gross profit, non-GAAP gross 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. The Company also presents non-GAAP gross profit, which is calculated as gross profit plus or minus certain items that management believes are not indicative of future operating performance or considered core to the Company's operations. Additionally, the Company presents non-GAAP Adjusted EBITDA margin, non-GAAP operating margin, and non-GAAP gross margin, which are calculated as the percentage of adjusted EBITDA, non-GAAP operating income, and non-GAAP gross profit to consolidated net sales, 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 press release, 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 Company's reference to trailing twelve months adjusted EBITDA within this press release refers to the twelve-month period ended June 30, 2026 adjusted EBITDA of $312.4 million, which consists of (i) the six months ended June 30, 2026 adjusted EBITDA of $157.7 million, as presented in the non-GAAP reconciliations below, and (ii) the twelve months ended December 31, 2025 adjusted EBITDA of $299.2 million, as presented in the non-GAAP reconciliations included in the Company's fourth quarter and full year 2025 results press release dated February 23, 2026, less (iii) the six months ended June 30, 2025 adjusted EBITDA of $144.5 million, as presented in the non-GAAP reconciliations below. Certain of the prior period non-GAAP financial measures presented in the following tables have been adjusted to conform with current period presentation. The following tables reconcile the Company's non-GAAP financial measures (unaudited) to their most directly comparable GAAP (unaudited) financial measures (dollars in thousands unless otherwise noted, except per share amounts): Segment Measures and Reconciliations Segment operating earnings for each of the Company's reportable segments are comprised of the segment's net sales less directly related product costs and other segment items. Operating expenses not directly attributable to the net sales of each respective segment, such as certain corporate and administrative costs and restructuring charges, are not included in segment operating earnings. Other items not specifically identified with the Company's reportable segments include Interest expense and Other income (expense), net. The following table presents information about the performance of the Company's reportable segments (dollars in thousands): Forward-Looking Statements This press release contains "forward-looking statements" that fall under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and the Securities Act of 1933, as amended. These statements can be identified by the fact that they do not relate strictly to historical or current facts. We have based these forward-looking statements on assumptions, projections and expectations about future events that we believe are reasonable based on currently available information, including statements regarding the potential effects of economic downturns; tariffs, including retaliatory tariffs, "trade wars" and uncertainty surrounding changes in tariffs; inflation and global supply chain constraints on the Company's business, results of operations, and financial condition; our expectation that we will maintain sufficient liquidity and remain in compliance with the terms of the Company's credit facility; expectations about future demand and raw material costs; and statements regarding the impact of increased raw material costs and pricing initiatives. These forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, intentions, financial condition, results of operations, future performance, and business, which may differ materially from our actual results, including but not limited to the potential benefits of acquisitions and divestitures, the impacts on our business as a result of global supply chain constraints and other macroeconomic stresses and uncertainties, including political and geopolitical events, civil disturbances and endemics/pandemics or extreme weather events and other natural disasters that may adversely affect regional economic conditions, and our current and future results and plans and statements that include the words "may," "could," "should," "would," "believe," "expect," "anticipate," "estimate," "intend," "outlook," "target," "possible," "potential," "plan" or similar expressions. Such statements include information relating to current and future business activities, operational matters, capital spending, and financing sources. A major risk is that demand for the Company's products and services is largely derived from the demand for its customers' products, which subjects the Company to uncertainties related to downturns in a customer's business and unanticipated customer production slowdowns and shutdowns. Other major risks and uncertainties include, but are not limited to, inflationary pressures, including increases in raw material costs; supply chain constraints and the impacts of economic downturns; customer financial instability; high interest rates and their impact on our and our customers' business operations; the impacts from acts of war, terrorism and military conflicts, including those in Ukraine and the Middle East as well as economic and political actions taken by various government organizations; economic and political disruptions globally and the possibility of regime changes; the possibility of economic recession; legislative and regulatory developments including changes to existing laws and regulations, or the way they are interpreted, applied or enforced; tariffs, trade restrictions, and the economic and other sanctions imposed by other nations on Russia and Belarus and/or other government organizations; suspensions of activities in Russia by many multinational companies; foreign currency fluctuations; significant changes in applicable tax rates and regulations and the potential impacts therefrom, including those arising from H.R.1, commonly known as the "One Big Beautiful Bill Act"; other acts of violence; the impacts of consolidation in our industry, including loss or consolidation of a major customer; the effects of climate change, fires, or other natural disasters; and the potential occurrence of cyber-security breaches, cyber-security attacks and other technology outages and security incidents. Furthermore, the Company is subject to the same business cycles as those experienced by our customers in the steel, automobile, aircraft, industrial equipment, aluminum and durable goods industries. Our forward-looking statements are subject to risks, uncertainties and assumptions about the Company and its operations that are subject to change based on various important factors, some of which are beyond our control. These risks, uncertainties, and possible inaccurate assumptions relevant to our business could cause our actual results to differ materially from expected and historical results. All forward-looking statements included in this press release, including expectations about future periods, are based upon information available to the Company as of the date of this press release, which may change. Therefore, we caution you not to place undue reliance on our forward-looking statements. For more information regarding these risks and uncertainties as well as certain additional risks that we face, refer to the Risk Factors section, which appears in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2025, and in subsequent reports filed from time to time with the Securities and Exchange Commission. We do not intend to, and we disclaim any duty or obligation to, update or revise any forward-looking statements to reflect new information or future events or for any other reason. Conference Call As previously announced, the Company's investor conference call to discuss its second quarter of 2026 performance is scheduled for Friday, July 31, 2026 at 8:30 a.m. ET. A live webcast of the conference call, together with supplemental information, can be accessed through the Company's Investor Relations website at investors.quakerhoughton.com. You can also access the conference call by dialing 877-269-7756. About Quaker Houghton Quaker Houghton is the global leader in industrial process fluids. With a presence around the world, including operations in over 25 countries, our customers include thousands of the world's most advanced and specialized steel, aluminum, automotive, aerospace, offshore, can, mining, and metalworking companies. Our high-performing, innovative and sustainable solutions are backed by best-in-class technology, deep process knowledge and customized services. With approximately 4,700 employees, including chemists, engineers and industry experts, we partner with our customers to improve their operations so they can run even more efficiently, even more effectively, whatever comes next. Quaker Houghton is headquartered in Conshohocken, Pennsylvania, located near Philadelphia in the United States. Visit quakerhoughton.com to learn more. 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Quaker Chemical (KWR) came out with quarterly earnings of $2.19 per share, beating the Zacks Consensus Estimate of $1.68 per share. This compares to earnings of $1.71 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +30.36%. A quarter ago, it was expected that this specialty chemical company would post earnings of $1.66 per share when it actually produced earnings of $1.63, delivering a surprise of -1.81%. Over the last four quarters, the company has surpassed consensus EPS estimates two times. Quaker Chemical, which belongs to the Zacks Chemical - Specialty industry, posted revenues of $532.55 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 4.05%. This compares to year-ago revenues of $483.4 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Quaker Chemical shares have added about 8.4% since the beginning of the year versus the S&P 500's gain of 6.9%. While Quaker Chemical has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Quaker Chemical was favorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #2 (Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $2.03 on $520.59 million in revenues for the coming quarter and $7.16 on $2.01 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Chemical - Specialty is currently in the top 34% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Balchem (BCPC), another stock in the same industry, has yet to report results for the quarter ended June 2026. The results are expected to be released on July 31. This chemical company is expected to post quarterly earnings of $1.40 per share in its upcoming report, which represents a year-over-year change of +10.2%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Balchem's revenues are expected to be $268.5 million, up 5.1% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Quaker Houghton (KWR) : Free Stock Analysis Report Balchem Corporation (BCPC) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Hawkins (HWKN) came out with quarterly earnings of $1.35 per share, missing the Zacks Consensus Estimate of $1.41 per share. This compares to earnings of $1.4 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of -4.26%. A quarter ago, it was expected that this chemical maker would post earnings of $0.76 per share when it actually produced earnings of $0.74, delivering a surprise of -2.63%. Over the last four quarters, the company has not been able to surpass consensus EPS estimates. Hawkins, which belongs to the Zacks Chemical - Specialty industry, posted revenues of $315.68 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 0.72%. This compares to year-ago revenues of $293.27 million. The company has topped consensus revenue estimates two times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Hawkins shares have added about 0.7% since the beginning of the year versus the S&P 500's gain of 8.5%. While Hawkins has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Hawkins was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.26 on $300.8 million in revenues for the coming quarter and $4.27 on $1.17 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Chemical - Specialty is currently in the top 38% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Quaker Chemical (KWR), another stock in the same industry, has yet to report results for the quarter ended June 2026. The results are expected to be released on July 30. This specialty chemical company is expected to post quarterly earnings of $1.68 per share in its upcoming report, which represents a year-over-year change of -1.8%. The consensus EPS estimate for the quarter has been revised 1.5% lower over the last 30 days to the current level. Quaker Chemical's revenues are expected to be $511.83 million, up 5.9% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Hawkins, Inc. (HWKN) : Free Stock Analysis Report Quaker Houghton (KWR) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Linde (LIN) is expected to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended June 2026. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price. The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be released on July 31. On the other hand, if they miss, the stock may move lower. While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of business conditions on the earnings call, it's worth handicapping the probability of a positive EPS surprise. This gas supplier is expected to post quarterly earnings of $4.49 per share in its upcoming report, which represents a year-over-year change of +9.8%. Revenues are expected to be $8.96 billion, up 5.5% from the year-ago quarter. The consensus EPS estimate for the quarter has been revised 0.55% higher over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period. Investors should keep in mind that the direction of estimate revisions by each of the covering analysts may not always get reflected in the aggregate change. Price, Consensus and EPS Surprise Estimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. Our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction) -- has this insight at its core. The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only. A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP. Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell). For Linde, the Most Accurate Estimate is lower than the Zacks Consensus Estimate, suggesting that analysts have recently become bearish on the company's earnings prospects. This has resulted in an Earnings ESP of -0.09%. On the other hand, the stock currently carries a Zacks Rank of #3. So, this combination makes it difficult to conclusively predict that Linde will beat the consensus EPS estimate. Analysts often consider to what extent a company has been able to match consensus estimates in the past while calculating their estimates for its future earnings. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number. For the last reported quarter, it was expected that Linde would post earnings of $4.27 per share when it actually produced earnings of $4.33, delivering a surprise of +1.41%. Over the last four quarters, the company has beaten consensus EPS estimates four times. An earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss. That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. Linde doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release. Among the stocks in the Zacks Chemical - Specialty industry, Quaker Chemical (KWR), is soon expected to post earnings of $1.68 per share for the quarter ended June 2026. This estimate indicates a year-over-year change of -1.8%. This quarter's revenue is expected to be $511.83 million, up 5.9% from the year-ago quarter. Over the last 30 days, the consensus EPS estimate for Quaker Chemical has been revised 1.5% down to the current level. Nevertheless, the company now has an Earnings ESP of -0.67%, reflecting a lower Most Accurate Estimate. This Earnings ESP, combined with its Zacks Rank #2 (Buy), makes it difficult to conclusively predict that Quaker Chemical will beat the consensus EPS estimate. Over the last four quarters, the company surpassed EPS estimates just once. Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Linde PLC (LIN) : Free Stock Analysis Report Quaker Houghton (KWR) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research