Koppers Holdings(US:KOP) Prnewswireยท2025-08-08 11:55Core Viewpoint - Koppers Holdings Inc. reported a decline in net sales and net income for the second quarter of 2025, attributed to sluggish demand across all business segments, while adjusted earnings showed slight improvement due to cost-saving measures and operational efficiencies [3][5][7]. Financial Performance - Net sales for Q2 2025 were $504.8 million, down from $563.2 million in Q2 2024, representing a decrease of $58.4 million or 10.4% [2][5]. - Net income attributable to Koppers was $16.4 million, a decline of $10.4 million or 38.8% from $26.8 million in the prior year [2][5]. - Diluted earnings per share (EPS) decreased to $0.81 from $1.25, a drop of 35.2% [2][5]. - Adjusted EPS increased to $1.48 from $1.36, reflecting a growth of 8.8% [2][5]. - Adjusted EBITDA was $77.1 million, slightly down from $77.5 million, a decrease of 0.5% [2][5]. Segment Performance - Railroad and Utility Products and Services net sales were $250.4 million, down 1.4% from $253.9 million [4][29]. - Performance Chemicals net sales decreased by 14.8% to $150.8 million from $176.9 million [4][29]. - Carbon Materials and Chemicals saw a 21.8% decline in net sales to $103.6 million from $132.4 million [4][29]. - Adjusted EBITDA margins improved in Railroad and Utility Products and Services to 12.6%, while Performance Chemicals decreased to 19.0% [4][29]. Operational Insights - The company has experienced a 14-month decline in its global employee base, totaling an 11% reduction since April 2024 [3]. - The exit from the phthalic anhydride business has positively impacted margins [3]. - Strong operating cash flow and reduced capital expenditures allowed for debt reduction and capital return to shareholders through share repurchases and dividends [3]. 2025 Outlook - Koppers revised its sales forecast to approximately $1.9 billion to $2.0 billion, down from a previous estimate of $2.0 billion to $2.2 billion [7][8]. - Adjusted EBITDA is now projected to be between $250 million and $270 million, with adjusted EPS expected to be approximately $4.00 to $4.60 per share [7][8]. - The company anticipates significant benefits from cost reduction initiatives despite ongoing demand challenges [7][9]. Strategic Initiatives - The Catalyst transformation process initiated at the beginning of 2025 is expected to achieve a sustainable mid to high teens adjusted EBITDA margin in the next two to three years [10]. - The company plans to utilize the majority of free cash flow generated in the latter half of the year to reduce borrowings [9].