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Kronos Worldwide (KRO) Q2 Earnings and Sales Trail Estimates
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Kronos Worldwide, Inc. (KRO - Free Report) recorded profit of $25.7 million or 22 cents per share in second-quarter 2021, up from $18.6 million or 16 cents in the year-ago quarter. The figure however, missed the Zacks Consensus Estimate of 26 cents per share.
The increase in the bottom line in the reported quarter was due to higher income from operations led by rise in sales volumes and higher average titanium dioxide (TiO2) selling prices, partly offset by increase in manufacturing and other production costs.
Net sales rose 24% year over year to $478.6 million from $386 million, driven by higher sales volumes and higher average TiO2 selling prices. The top line, however, missed the Zacks Consensus Estimate of $483.4 million.
Kronos Worldwide Inc Price, Consensus and EPS Surprise
The company’s TiO2 sales volumes went up 16% year over year in the reported quarter due to strong demand in all major markets on the back the ongoing global recovery. TiO2 production volumes were up 2% due to adjustments done in 2020 to reduce production levels as a result of the pandemic.
Profit in the segment increased in the reported quarter on the back of higher sales volumes and rise in average TiO2 selling prices, which were partly offset by increased manufacturing and other production costs, including higher costs for raw materials and energy.
Average TiO2 selling prices climbed 3% year over year in the quarter.
Financials
Kronos Worldwide ended the second quarter with cash and cash equivalents of $363.8 million, increasing 6.6% year over year. Long-term debt was $472.5 million, marking a 6.2% rise.
Net cash provided by operating activities was $78.1 million in the six months ended Jun 30, 2021.
Outlook
Kronos expects global demand for consumer products to remain strong through 2021, positively impacting sales and production volumes, despite certain disruptions in global supply-chains and raw materials constraints and delays in transportation and logistics that are expected to continue in the near future. The company also expects TiO2 selling prices to rise through 2021 on higher consumer demand.
The company expects its sales and income from operations for 2021 to be higher on a year-over-year basis, mainly due to rise in TiO2 selling prices and sales volumes. However its margins are expected to be affected by persistent cost increases.
Price Performance
Kronos’s shares have risen 12.1% over a year, underperforming the 34.9% rise of the industry.
Image: Bigstock
Kronos Worldwide (KRO) Q2 Earnings and Sales Trail Estimates
Kronos Worldwide, Inc. (KRO - Free Report) recorded profit of $25.7 million or 22 cents per share in second-quarter 2021, up from $18.6 million or 16 cents in the year-ago quarter. The figure however, missed the Zacks Consensus Estimate of 26 cents per share.
The increase in the bottom line in the reported quarter was due to higher income from operations led by rise in sales volumes and higher average titanium dioxide (TiO2) selling prices, partly offset by increase in manufacturing and other production costs.
Net sales rose 24% year over year to $478.6 million from $386 million, driven by higher sales volumes and higher average TiO2 selling prices. The top line, however, missed the Zacks Consensus Estimate of $483.4 million.
Kronos Worldwide Inc Price, Consensus and EPS Surprise
Kronos Worldwide Inc price-consensus-eps-surprise-chart | Kronos Worldwide Inc Quote
Volumes and Pricing
The company’s TiO2 sales volumes went up 16% year over year in the reported quarter due to strong demand in all major markets on the back the ongoing global recovery. TiO2 production volumes were up 2% due to adjustments done in 2020 to reduce production levels as a result of the pandemic.
Profit in the segment increased in the reported quarter on the back of higher sales volumes and rise in average TiO2 selling prices, which were partly offset by increased manufacturing and other production costs, including higher costs for raw materials and energy.
Average TiO2 selling prices climbed 3% year over year in the quarter.
Financials
Kronos Worldwide ended the second quarter with cash and cash equivalents of $363.8 million, increasing 6.6% year over year. Long-term debt was $472.5 million, marking a 6.2% rise.
Net cash provided by operating activities was $78.1 million in the six months ended Jun 30, 2021.
Outlook
Kronos expects global demand for consumer products to remain strong through 2021, positively impacting sales and production volumes, despite certain disruptions in global supply-chains and raw materials constraints and delays in transportation and logistics that are expected to continue in the near future. The company also expects TiO2 selling prices to rise through 2021 on higher consumer demand.
The company expects its sales and income from operations for 2021 to be higher on a year-over-year basis, mainly due to rise in TiO2 selling prices and sales volumes. However its margins are expected to be affected by persistent cost increases.
Price Performance
Kronos’s shares have risen 12.1% over a year, underperforming the 34.9% rise of the industry.
Image Source: Zacks Investment Research
Zacks Rank & Stocks to Consider
Currently, Kronos carries a Zacks Rank #3 (Hold).
Better-ranked stocks in the basic materials space include Orion Engineered Carbons S.A (OEC - Free Report) , LyondellBasell Industries N.V. (LYB - Free Report) and Avient Corporation (AVNT - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Orion has a projected earnings growth rate of 79.8% for the current year. The company’s shares have grown 50.8% over the past year.
LyondellBasell has a projected earnings growth rate of 222.6% for the current year. The company’s shares have risen 47.3% over the past year.
Avient has a projected earnings growth rate of 65.3% for the current year. The company’s shares have surged 85.1% over the past year.