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NL Industries, Inc.
Three Lincoln Centre
5430 LBJ Freeway, Suite 1700
Dallas, TX 75240-2697
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Contact: Janet G. Keckeisen
Vice President – Corporate Strategy and Investor Relations
(972) 233-1700
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News Release
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Future supply and demand for our products
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The extent of the dependence of certain of our businesses on certain market sectors
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The cyclicality of our businesses (such as Kronos’ TiO2 operations)
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Customer and producer inventory levels
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Unexpected or earlier-than-expected industry capacity expansion (such as the TiO2 industry)
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Changes in raw material and other operating costs (such as energy, ore, zinc, aluminum, steel and brass costs) and our ability to pass those
costs on to our customers or offset them with reductions in other operating costs
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Changes in the availability of raw material (such as ore)
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General global economic and political conditions that harm the worldwide economy, disrupt our supply chain, increase material costs or reduce
demand or perceived demand for Kronos’ TiO2 and our products or impair our ability to operate our facilities (including changes in the level of gross domestic product in various regions of the world, natural disasters,
terrorist acts, global conflicts and public health crises such as COVID-19)
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Competitive products and substitute products
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Price and product competition from low-cost manufacturing sources (such as China)
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Customer and competitor strategies
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Potential consolidation of Kronos’ competitors
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Potential consolidation of Kronos’ customers
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The impact of pricing and production decisions
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Competitive technology positions
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Our ability to protect or defend intellectual property rights
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Potential difficulties in integrating future acquisitions
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Potential difficulties in upgrading or implementing accounting and manufacturing software systems
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The introduction of trade barriers or trade disputes
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The impact of current or future government regulations (including employee healthcare benefit related regulations)
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Fluctuations in currency exchange rates (such as changes in the exchange rate between the U.S. dollar and each of the euro, the Norwegian krone
and the Canadian dollar and between the euro and the Norwegian krone), or possible disruptions to our business resulting from uncertainties associated with the euro or other currencies
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Operating interruptions (including, but not limited to, labor disputes, leaks, natural disasters, fires, explosions, unscheduled or unplanned
downtime, transportation interruptions, cyber-attacks and public health crises such as COVID-19)
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Decisions to sell operating assets other than in the ordinary course of business
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Kronos’ ability to renew or refinance credit facilities
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Our ability to maintain sufficient liquidity
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The timing and amounts of insurance recoveries
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The ability of our subsidiaries or affiliates to pay us dividends
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Uncertainties associated with CompX’s development of new products and product features
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The ultimate outcome of income tax audits, tax settlement initiatives or other tax matters, including future tax reform
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Our ability to utilize income tax attributes or changes in income tax rates related to such attributes, the benefits of which may or may not
have been recognized under the more-likely-than-not recognition criteria
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Environmental matters (such as those requiring compliance with emission and discharge standards for existing and new facilities or new
developments regarding environmental remediation at sites related to our former operations)
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Government laws and regulations and possible changes therein (such as changes in government regulations which might impose various obligations
on former manufacturers of lead pigment and lead-based paint, including us, with respect to asserted health concerns associated with the use of such products), including new environmental health and safety regulations such as those
seeking to limit or classify TiO2 or its use
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The ultimate resolution of pending litigation (such as our lead pigment and environmental matters)
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Possible future litigation.
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Three months ended
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March 31,
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2020
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2021
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(unaudited)
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Net sales
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$
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32.3
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$
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35.9
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||||
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Cost of sales
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21.9
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24.9
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Gross margin
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10.4
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11.0
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Selling, general and administrative expense
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5.4
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5.2
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Corporate expense
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2.5
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1.8
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Income from operations
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2.5
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4.0
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Equity in earnings of Kronos Worldwide, Inc.
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8.2
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6.0
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Other income (expense):
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Interest and dividend income
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1.1
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.4
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Marketable equity securities
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(12.1
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)
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6.4
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Other components of net periodic pension and OPEB cost
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(.2
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)
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(.1
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)
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Interest expense
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(.3
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)
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(.3
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)
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Income (loss) before income taxes
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(.8
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)
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16.4
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Income tax expense (benefit)
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(3.3
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)
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2.5
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Net income
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2.5
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13.9
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Noncontrolling interest in net income of subsidiary
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.6
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.6
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Net income attributable to NL stockholders
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$
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1.9
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$
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13.3
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Net income per share attributable to
NL stockholders
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$
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.04
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$
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.27
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Weighted average shares used in the calculation
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||||||||
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of net income per share
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48.8
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48.8
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Three months ended
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March 31,
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2020
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2021
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|||||||
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CompX - component products
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$
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5.0
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$
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5.8
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Corporate expense
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(2.5
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)
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(1.8
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)
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Income from operations
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$
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2.5
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$
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4.0
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Three months ended
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March 31,
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2021 vs. 2020
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Percentage change in net sales:
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TiO2 sales volume
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3
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%
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TiO2 product pricing
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(1
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)
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TiO2 product mix/other
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3
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Changes in currency exchange rates
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5
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Total
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10
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%
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