VALHI REPORTS SECOND QUARTER 2021 RESULTS
05 Agosto 2021 - 10:15PM
Valhi, Inc. (NYSE: VHI) reported net income attributable to Valhi
stockholders of $21.4 million, or $.75 per share, in the second
quarter of 2021 compared to a net loss of $9.1 million, or $.32 per
share, in the second quarter of 2020. For the first six
months of 2021, Valhi reported net income attributable to Valhi
stockholders of $36.2 million, or $1.27 per diluted share compared
to net income of $15.3 million, or $.54 per diluted share in the
first six months of 2020. Net income attributable to Valhi
stockholders increased in the second quarter of 2021 as compared to
the second quarter of 2020 primarily due to higher operating
results from all of our segments and a gain on the sale of land not
used in our operations. Net income attributable to Valhi
stockholders increased in the first six months of 2021 as compared
to the first six months of 2020 primarily due to the net effects of
higher operating results from our Chemicals and Component Products
Segments, lower income from tax increment infrastructure
reimbursement from our Real Estate Management and Development
Segment in 2021and a gain on the sale of land not used in our
operations in the second quarter of 2021.
The Chemicals Segment’s net sales were $478.6
million in the second quarter of 2021 compared to $386.0 million in
the second quarter of 2020 and $943.6 million in the first six
months of 2021 compared to $807.0 million in the same period of
2020. The Chemicals Segment’s net sales increased in the 2021
periods primarily due to higher sales volumes and higher average
TiO2 selling prices. TiO2 sales volumes were 16% higher in the
second quarter of 2021 as compared to the second quarter of 2020
and 9% higher in the first six months of 2021 compared to the same
period in 2020 primarily due to higher demand in all major markets
resulting from overall improvements in global economic activity in
the 2021 periods compared to the same periods in 2020 due to the
negative economic effects from the COVID-19 pandemic in the second
quarter of 2020. The Chemicals Segment’s average TiO2 selling
prices were 3% higher in the second quarter of 2021 as compared to
the second quarter of 2020 and 1% higher in the first six months of
2021 as compared to the first six months of 2020. The
Chemicals Segment’s average TiO2 selling prices at the end of the
second quarter of 2021 were 4% higher than its average TiO2 selling
prices at the end of 2020. TiO2 selling prices will increase or
decrease generally as a result of competitive market pressures,
changes in the relative level of supply and demand as well as
changes in raw material and other manufacturing costs. Fluctuations
in currency exchange rates (primarily the euro) also affected net
sales comparisons, increasing our Chemicals Segment’s net sales by
approximately $22 million in the second quarter of 2021 and
approximately $42 million in the first six months of 2021 as
compared to the second quarter and first six months of 2020. The
table at the end of this press release shows how each of these
items impacted net sales.
The Chemicals Segment’s operating income in the
second quarter of 2021 was $47.4 million as compared to $35.9
million in the second quarter of 2020 and $85.1 million for the six
months ended June 30, 2021 compared to $82.7 million for the same
prior year period. The Chemicals Segment’s operating income
increased in the 2021 periods primarily due to higher sales volumes
and higher average TiO2 selling prices, partially offset by higher
manufacturing and other production costs, including higher costs
for raw materials and energy. The Chemicals Segment’s TiO2
production volumes were 2% higher in the second quarter of 2021 as
compared to the second quarter of 2020 and 1% higher in the
year-to-date period of 2021 due to adjustments to reduce production
levels in 2020 as a result of the COVID-19 pandemic. The Chemicals
Segment’s production facilities operated its production facilities
at overall average capacity utilization rates of 99% in the first
six months of 2021 (97% and 100% in the first and second quarters
of 2021, respectively) compared to 95% in 2020 (95% and 96% in the
first and second quarters of 2020, respectively).
Fluctuations in currency exchange rates also affected the
year-to-date operating income comparison, which decreased operating
income by approximately $17 million in the year-to-date 2021 period
as compared to the same period of 2020. Fluctuations in
currency exchange rates had a nominal effect on the second quarter
operating income comparison.
The Component Products Segment’s net sales were
$36.3 million in the second quarter of 2021 compared to $23.8
million in the second quarter of 2020 and $72.2 million in the
first six months of 2021 compared to $56.1 million in the same
period of 2020. The Component Products Segment’s net sales
increased primarily due to higher sales volumes for both security
products and marine components as many of our Component Products
Segment’s customers were temporarily closed or reduced production
during the second quarter of 2020 due to government ordered
closures or reduced demand resulting from the COVID-19 pandemic.
Operating income attributable to the Component Products Segment was
$5.8 million in the second quarter of 2021 compared to $2.4 million
in the second quarter of 2020 and $11.6 million for the six months
ended June 30, 2021 compared to $7.4 million for the same prior
year period. The Component Products Segment’s operating income
increased for both comparative periods due to the favorable effect
of higher sales volumes, partially offset by higher production
costs including increased labor and shipping costs.
The Real Estate Management and Development
Segment had sales of $10.4 million in the second quarter of 2021,
including $8.5 million in revenue on sales of land held for
development, compared to sales of $5.2 million in the second
quarter of 2020, including $2.7 million in revenue on sales of land
held for development. For the first six months of 2021 the Real
Estate Management and Development Segment had sales of $18.5
million, including $15.1 million in revenue on sales of land held
for development, compared to sales of $11.2 million, including $6.2
million in sales of land held for development in the same period of
2020. Land sales revenue is generally recognized over time based on
cost inputs, and land sales revenues are dependent on spending for
development activities as we balance development requirements with
home builder output during the year. Land sales revenues are
also impacted by the relative timing of when new land parcel sales
are closed. Land sales revenues increased in the second
quarter and first six months of 2021 as compared to the same
periods in 2020 primarily due to an increase in the amount of
acreage sold in 2021 as compared to 2020 and increased development
activity in the second quarter of 2021 compared to the same period
of 2020. During the second quarter of 2020 we slowed infrastructure
spending within the residential/planned community due to the
uncertainty associated with the COVID-19 pandemic. As a result of
increased land sales revenues, operating income increased in both
the second quarter and first six months of 2021 compared to the
same periods of 2020, excluding the recognition of tax increment
reimbursement note receivables of $6.2 million ($3.2 million, or
$.11 per share, net of income taxes and noncontrolling interest)
and $19.1 million ($9.9 million, or $.35 per share, net of income
taxes and noncontrolling interest) in the first six months of 2021
and 2020, respectively.
Corporate expenses in the second quarter and
first six months of 2021 were comparable to the same periods of
2020. In the second quarter of 2021 we sold excess property not
used in our operations for net proceeds of approximately $8.4
million and recognized a pre-tax gain of $5.6 million ($4.3
million, or $.15 per share, net of income taxes and noncontrolling
interest). In the first quarter of 2020, Kronos recognized a $1.5
million insurance settlement gain ($.8 million, or $.03 per share,
net of income taxes and noncontrolling interest) related to a
property damage claim.
We recognized income tax expense of $10.3
million in the second quarter of 2021 compared to income tax
expense of $21.2 million in the second quarter of 2020 and $18.3
million in the first six months of 2021 compared to $32.6 million
in the first six months of 2020. The decrease in both periods
is primarily due to higher amounts recognized for global intangible
low-tax income (GILTI) in 2020 due to limitations on related
deductions and tax credits and an increase in the valuation
allowance in 2020 for the nondeductible amount of business interest
expense carryforward not expected to be fully utilized under the
more-likely-than-not recognition criteria. For interim
financial reporting purposes, we apply an estimated annual
effective tax rate in determining our provision for income taxes
and in 2020 our estimated annual effective tax rate was
significantly impacted due to the effects of GILTI and the increase
to the valuation allowance relative to our earnings.
The statements in this press release relating to
matters that are not historical facts are forward-looking
statements that represent management's beliefs and assumptions
based on currently available information. Although we believe
the expectations reflected in such forward-looking statements are
reasonable, we cannot give any assurances that these expectations
will be correct. Such statements by their nature involve
substantial risks and uncertainties that could significantly impact
expected results, and actual future results could differ materially
from those predicted. While it is not possible to identify all
factors, we continue to face many risks and uncertainties.
Among the factors that could cause our actual future results to
differ materially include, but are not limited to, the
following:
- Future supply and demand for our products;
- The extent of the dependence of certain of our businesses on
certain market sectors;
- The cyclicality of certain of our businesses (such as Kronos’
TiO2 operations);
- Customer and producer inventory levels;
- Unexpected or earlier-than-expected industry capacity expansion
(such as the TiO2 industry);
- Changes in raw material and other operating costs (such as ore,
zinc, brass, aluminum, steel and energy costs);
- Changes in the availability of raw materials (such as
ore);
- General global economic and political conditions that harm the
worldwide economy, disrupt our supply chain, increase material
costs, reduce demand or perceived demand for TiO2, component
products and land held for development 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);
- Competitive products and substitute products;
- Customer and competitor strategies;
- Potential difficulties in integrating future acquisitions;
- Potential difficulties in upgrading or implementing accounting
and manufacturing software systems;
- Potential consolidation of our competitors;
- Potential consolidation of our customers;
- The impact of pricing and production decisions;
- Competitive technology positions;
- Our ability to protect or defend intellectual property
rights;
- The introduction of trade barriers or trade disputes;
- The ability of our subsidiaries to pay us dividends;
- The impact of current or future government regulations
(including employee healthcare benefit related regulations);
- Uncertainties associated with new product development and the
development of new product features;
- 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;
- 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);
- Decisions to sell operating assets other than in the ordinary
course of business;
- The timing and amounts of insurance recoveries;
- Our ability to renew, amend, refinance or establish credit
facilities;
- Our ability to maintain sufficient liquidity;
- The ultimate outcome of income tax audits, tax settlement
initiatives or other tax matters, including future tax reform;
- Our ability to utilize income tax attributes, the benefits of
which may or may not have been recognized under the
more-likely-than-not recognition criteria;
- 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);
- 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 NL, 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;
- The ultimate resolution of pending litigation (such as NL’s
lead pigment and environmental matters);
- Our ability to comply with covenants contained in our revolving
bank credit facilities;
- Our ability to complete and comply with the conditions of our
licenses and permits;
- Changes in real estate values and construction costs in
Henderson, Nevada;
- Water levels in Lake Mead; and
- Possible future litigation.
Should one or more of these risks materialize
(or the consequences of such development worsen), or should the
underlying assumptions prove incorrect, actual results could differ
materially from those currently forecasted or expected. We
disclaim any intention or obligation to update or revise any
forward-looking statement whether as a result of changes in
information, future events or otherwise.
Valhi, Inc. is engaged in the chemicals (TiO2),
component products (security products and recreational marine
components) and real estate management and development
industries.
* * * * *
VALHI, INC. AND SUBSIDIARIES |
|
|
|
|
|
|
|
CONDENSED SUMMARY OF OPERATIONS |
|
|
|
|
|
|
|
(In millions, except earnings per share) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
|
Six months ended |
|
|
June 30, |
|
|
June 30, |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
(unaudited) |
|
Net
sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chemicals |
$ |
386.0 |
|
|
$ |
478.6 |
|
|
$ |
807.0 |
|
|
$ |
943.6 |
|
Component products |
|
23.8 |
|
|
|
36.3 |
|
|
|
56.1 |
|
|
|
72.2 |
|
Real estate management and development |
|
5.2 |
|
|
|
10.4 |
|
|
|
11.2 |
|
|
|
18.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total net
sales |
$ |
415.0 |
|
|
$ |
525.3 |
|
|
$ |
874.3 |
|
|
$ |
1,034.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chemicals |
$ |
35.9 |
|
|
$ |
47.4 |
|
|
$ |
82.7 |
|
|
$ |
85.1 |
|
Component products |
|
2.4 |
|
|
|
5.8 |
|
|
|
7.4 |
|
|
|
11.6 |
|
Real estate management and development |
|
1.0 |
|
|
|
2.4 |
|
|
|
20.2 |
|
|
|
10.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating
income |
|
39.3 |
|
|
|
55.6 |
|
|
|
110.3 |
|
|
|
106.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General
corporate items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities earnings |
|
1.0 |
|
|
|
1.1 |
|
|
|
2.6 |
|
|
|
2.0 |
|
Insurance recoveries |
|
- |
|
|
|
- |
|
|
|
1.6 |
|
|
|
- |
|
Gain on land and related sales |
|
- |
|
|
|
5.6 |
|
|
|
.5 |
|
|
|
5.6 |
|
Changes in market value of Valhi common stock held by
subsidiaries |
|
(.5 |
) |
|
|
.9 |
|
|
|
(2.9 |
) |
|
|
2.2 |
|
Other components of net periodic pension and OPEB
expense |
|
(5.0 |
) |
|
|
(4.6 |
) |
|
|
(9.7 |
) |
|
|
(8.9 |
) |
General expenses, net |
|
(9.0 |
) |
|
|
(9.3 |
) |
|
|
(17.6 |
) |
|
|
(17.4 |
) |
Interest expense |
|
(8.8 |
) |
|
|
(8.7 |
) |
|
|
(18.5 |
) |
|
|
(17.3 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes |
|
17.0 |
|
|
|
40.6 |
|
|
|
66.3 |
|
|
|
73.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense |
|
21.2 |
|
|
|
10.3 |
|
|
|
32.6 |
|
|
|
18.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss) |
|
(4.2 |
) |
|
|
30.3 |
|
|
|
33.7 |
|
|
|
54.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noncontrolling
interest in net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of
subsidiaries |
|
4.9 |
|
|
|
8.9 |
|
|
|
18.4 |
|
|
|
18.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Valhi stockholders |
$ |
(9.1 |
) |
|
$ |
21.4 |
|
|
$ |
15.3 |
|
|
$ |
36.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts
attributable to Valhi stockholders: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net income (loss) per share |
$ |
(.32 |
) |
|
$ |
.75 |
|
|
$ |
.54 |
|
|
$ |
1.27 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted weighted average shares outstanding |
|
28.5 |
|
|
|
28.5 |
|
|
|
28.5 |
|
|
|
28.5 |
|
VALHI, INC. AND SUBSIDIARIES |
|
|
|
|
|
|
IMPACT OF PERCENTAGE CHANGE IN CHEMICAL SEGMENT'S NET
SALES |
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
Six months ended |
|
June 30, |
|
June 30, |
|
2021 vs. 2020 |
|
2021 vs. 2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage
change in TiO2 net sales : |
|
|
|
|
|
|
|
|
|
|
|
TiO2 sales volumes |
|
|
16 |
|
% |
|
|
|
9 |
|
% |
TiO2 product pricing |
|
|
3 |
|
|
|
|
|
1 |
|
|
TiO2 product mix/other |
|
|
(1 |
) |
|
|
|
|
2 |
|
|
Changes in currency exchange
rates |
|
|
6 |
|
|
|
|
|
5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
24 |
|
% |
|
|
|
17 |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
SOURCE: Valhi, Inc.
CONTACT: Janet G. Keckeisen, Vice President - Investor Relations, 972.233.1700
Grafico Azioni Valhi (NYSE:VHI)
Storico
Da Apr 2024 a Mag 2024
Grafico Azioni Valhi (NYSE:VHI)
Storico
Da Mag 2023 a Mag 2024