Kronos Worldwide, Inc.

What they do

Kronos manufactures and markets value-added titanium dioxide (TiO2) pigments, a white pigment used in paints, plastics, paper, and specialty products. The company operates production facilities in Europe and North America and sells to approximately 3,000 customers in 100 countries, with about 45% of sales volumes in Europe.

Revenue drivers

• TiO2 sales volumes — Revenue is driven by the volume of TiO2 sold; higher volumes in 2026 are attributed to market share gains across all markets.
• TiO2 average selling prices — Pricing is a key competitive factor; average selling prices in 2026 were lower than the prior year but increased 4% in the first half of 2026.
• Currency exchange rates — Fluctuations, particularly the euro, affect net sales; exchange rate changes increased net sales by approximately $41 million in the first half of 2026.

Recent performance

For Q2 2026, the company reported net income of $15.2 million (EPS $0.13) versus a net loss of $9.2 million (EPS -$0.08) in Q2 2025. Net sales in Q2 2026 were $558.1 million, up 13% year-over-year, and $1.1 billion for the first half, up 9%. Segment profit for TiO2 was $41.0 million in Q2 2026, up from $10.9 million a year ago. The improvement was driven by higher sales volumes and lower production costs, partially offset by lower selling prices.

Strategy

The company is executing cost reduction initiatives implemented in Q4 2025, including workforce reductions and other measures to improve long-term cost structure. Management is focused on operational efficiency, commercial execution, and disciplined cost management to offset elevated energy and related costs. They have announced and implemented price increases and surcharges in response to higher operating costs.

Risks

• Cyclical demand — TiO2 demand is tied to GDP and can fluctuate with economic conditions, impacting volumes and pricing.
• Raw material costs — Costs of titanium-containing feedstock and energy are key inputs; elevated energy costs have pressured profitability.
• Currency exposure — Changes in exchange rates, particularly USD vs. euro, Norwegian krone, and Canadian dollar, can materially affect net sales and segment profit.
• Tariffs and trade policy — Anticipated U.S. tariffs caused the company to reposition inventory and incur higher distribution costs in early 2025.

Outlook

Management expects positive momentum into the second half of 2026, driven by continued execution of operational, commercial, and cost reduction initiatives. They anticipate ongoing pricing actions and disciplined cost management to help offset elevated energy and related costs. Despite a challenging macroeconomic environment, the company remains focused on sustainable earnings improvement and stronger cash flow.