Q2 2026 Quaker Chemical Corp Earnings Call Transcript
Key Points
- 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.
Greetings and welcome to the Quaker Houghton Second Quarter 2026 Earnings Conference Call. A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press *0 on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the call over to John Dahhoff, Director of Investor Relations. Mr. Dahhoff, you may begin.
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 Kohler, 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 US 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
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