Northern Technologies International Corporation Reports Financial Results for First Quarter Fiscal 2026

Core Insights - Northern Technologies International Corporation (NTIC) reported record consolidated net sales of $23.3 million for the first quarter of fiscal 2026, reflecting a year-over-year growth of 9.2% compared to $21.3 million in the same period last year, driven by strong demand in key sectors such as ZERUST® oil and gas and Natur-Tec® products [1][3][4] Financial Performance - Consolidated net sales increased by 9.2% to $23,309,000 for the three months ended November 30, 2025, compared to $21,338,000 for the same period in 2024 [3][4] - ZERUST® industrial net sales rose by 6.9% to $14,923,000, while ZERUST® oil and gas net sales surged by 58.1% to $2,394,000, marking a record for the first quarter [4] - Natur-Tec® product net sales increased by 2.2% to $5,993,000, and NTIC China net sales grew by 23.5% to $4,935,000 [4] Profitability and Expenses - Operating expenses as a percentage of sales improved to 41.8% from 44.4% year-over-year, indicating better cost management [2][6] - Despite a modest decline in gross margin due to supplier lead-time issues, management expects gross margin to improve sequentially throughout fiscal 2026 [2][4] Income and Taxation - Net income attributable to NTIC was $238,000, or $0.03 per diluted share, down from $561,000, or $0.06 per diluted share, in the same quarter last year [4][8] - The effective income tax rate increased to 34.4% from 21.5% year-over-year, primarily due to taxes paid at foreign subsidiaries and withholding taxes [7][8] Working Capital and Investments - As of November 30, 2025, NTIC had working capital of $19,441,000, including $6,390,000 in cash and cash equivalents [9] - Investments in joint ventures totaled $29,277,000, with $15,616,000 in cash, representing 53.4% of the total [10]