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Kronos Worldwide, Inc. (KRO - Free Report) recorded profits of $36 million or 31 cents per share in third-quarter 2021, up from $8.1 million or 7 cents in the year-ago quarter. The figure beat the Zacks Consensus Estimate of 24 cents per share.
The bottom line in the reported quarter was driven by higher sales volumes and increased average titanium dioxide (TiO2) selling prices that more than offset higher production costs including raw material and energy costs.
Net sales rose 20% year over year to $499.8 million, driven by higher sales volumes and higher average TiO2 selling prices. The top line, however, missed the Zacks Consensus Estimate of $502 million.
Kronos Worldwide Inc Price, Consensus and EPS Surprise
The company’s TiO2 sales volumes went up 6% year over year in the reported quarter due to higher demand in its European and North American markets. TiO2 production volumes were up 13% due to adjustments done in 2020 to reduce production levels as a result of the pandemic.
TiO2 segment profit increased around 168% year over year 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 11% year over year in the quarter.
Financials
Kronos Worldwide ended the third quarter with cash and cash equivalents of $373.5 million, increasing roughly 7% year over year. Long-term debt was $461.1 million, a roughly 1% year-over-year decline.
Net cash provided by operating activities was $126 million in the nine months ended Sep 30, 2021.
Outlook
Kronos expects global demand for consumer products to remain strong through the balance of 2021, positively impacting sales and production volumes. It is seeing certain disruptions in global supply-chains including raw materials constraints as well as delays in transportation and logistics. It also expects TiO2 selling prices to rise through 2021 on strong consumer demand and rising costs.
The company expects its sales and income from operations for 2021 to be higher on a year-over-year basis. However, its margins are expected to be affected by cost increases.
Price Performance
Kronos’ shares are up 2.4% over a year, underperforming the 22.5% rise of the industry.
Image: Bigstock
Kronos Worldwide (KRO) Q3 Earnings Beat, Sales Trail Estimates
Kronos Worldwide, Inc. (KRO - Free Report) recorded profits of $36 million or 31 cents per share in third-quarter 2021, up from $8.1 million or 7 cents in the year-ago quarter. The figure beat the Zacks Consensus Estimate of 24 cents per share.
The bottom line in the reported quarter was driven by higher sales volumes and increased average titanium dioxide (TiO2) selling prices that more than offset higher production costs including raw material and energy costs.
Net sales rose 20% year over year to $499.8 million, driven by higher sales volumes and higher average TiO2 selling prices. The top line, however, missed the Zacks Consensus Estimate of $502 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 6% year over year in the reported quarter due to higher demand in its European and North American markets. TiO2 production volumes were up 13% due to adjustments done in 2020 to reduce production levels as a result of the pandemic.
TiO2 segment profit increased around 168% year over year 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 11% year over year in the quarter.
Financials
Kronos Worldwide ended the third quarter with cash and cash equivalents of $373.5 million, increasing roughly 7% year over year. Long-term debt was $461.1 million, a roughly 1% year-over-year decline.
Net cash provided by operating activities was $126 million in the nine months ended Sep 30, 2021.
Outlook
Kronos expects global demand for consumer products to remain strong through the balance of 2021, positively impacting sales and production volumes. It is seeing certain disruptions in global supply-chains including raw materials constraints as well as delays in transportation and logistics. It also expects TiO2 selling prices to rise through 2021 on strong consumer demand and rising costs.
The company expects its sales and income from operations for 2021 to be higher on a year-over-year basis. However, its margins are expected to be affected by cost increases.
Price Performance
Kronos’ shares are up 2.4% over a year, underperforming the 22.5% rise of the industry.
Zacks Rank & Stocks to Consider
Currently, Kronos carries a Zacks Rank #3 (Hold).
Better-ranked stocks worth considering in the basic materials space include Nutrien Ltd. (NTR - Free Report) , Steel Dynamics, Inc. (STLD - Free Report) and Methanex Corporation (MEOH - Free Report) , both sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Nutrien has an expected earnings growth rate of 206.11% for the current year. The stock has also rallied around 64% over a year.
Steel Dynamics has a projected earnings growth rate of 477.5% for the current year. The company’s shares have surged around 95% in a year.
Methanex has a projected earnings growth rate of 453.7% for the current year. The company’s shares have shot up around 32% in a year.