Valhi, Inc.

What they do

Valhi is primarily a holding company whose consolidated businesses are Kronos Worldwide (NYSE: KRO), CompX International (NYSE American: CIX), NLI Holdings (formerly NL Industries, NYSE: NL), Basic Management, Inc., and The LandWell Company. Its three reportable segments are Chemicals (TiO2 pigments through Kronos), Component Products (security products and marine components through CompX), and Real Estate Management and Development (land in Henderson, Nevada through BMI and LandWell). Contran Corporation, which may be deemed controlled by Lisa K. Simmons and a family trust, held approximately 91% of Valhi's common stock at December 31, 2025.

Revenue drivers

• Chemicals (Kronos TiO2) — The dominant segment: approximately 90% of Chemicals sales in 2025 were TiO2, sold into paints, plastics, paper, fibers and ceramics. Second quarter 2026 Chemicals net sales were $558.1 million, up 13% year over year.
• Component Products (CompX) — Security products for postal, transportation, furniture, cabinetry, tool storage and healthcare markets, plus marine components such as wake enhancement and exhaust systems. Second quarter 2026 net sales were $43.6 million versus $40.3 million a year earlier.
• Real Estate Management and Development — BMI and LandWell own and seek to develop land in Henderson, Nevada; second quarter 2026 net sales were $4.4 million, down from $5.7 million. LandWell completed the sale of the last parcel within the Cadence planned community in October 2025.

Recent performance

Valhi reported second quarter 2026 net income attributable to stockholders of $22.3 million, or $.78 per share, versus $.9 million, or $.03 per share, in the second quarter of 2025. First half 2026 net income was $24.3 million, or $.85 per share, compared with $17.8 million, or $.62 per share, a year earlier. The improvement was driven primarily by the Chemicals Segment, whose second quarter operating income rose to $40.4 million from $10.3 million on higher sales volumes, lower production and raw material costs, and benefits from fourth quarter 2025 cost reduction initiatives. Full year 2025 was a loss: net loss attributable to Valhi stockholders of $57.6 million, or $2.02 per diluted share, versus net income of $108.0 million, or $3.79 per share, in 2024.

Strategy

The strategy centers on operating through majority-owned public subsidiaries while Valhi functions as a holding company. Kronos has pursued cost reduction: restructuring charges of $10.3 million in 2025 were tied to Chemicals Segment workforce reductions designed to permanently improve the cost structure and operational efficiency, and the segment announced and implemented price increases and surcharges in the second quarter of 2026 in response to higher operating costs. Kronos also acquired the remaining 50% joint venture interest in Louisiana Pigment Company, L.P. from Venator in July 2024. In real estate, LandWell sold the last Cadence parcel in October 2025.

Risks

• TiO2 cyclicality — Pricing in the global TiO2 industry is cyclical, and relative selling price changes are described as one of the main factors affecting Chemicals Segment profitability.
• Currency exposure — Currency fluctuations, primarily the euro, decreased Chemicals Segment operating income by approximately $12 million in the second quarter of 2026 and $18 million in the first six months.
• German tax items — 2025 results included a $19.3 million non-cash deferred tax charge from the German tax rate reduction and an $8.5 million valuation allowance on the German interest deduction limitation deferred tax asset.
• Customer inventory swings — Customers may accelerate TiO2 purchases ahead of anticipated price increases or defer purchases ahead of price decreases, affecting segment volumes and margins.

Outlook

Management attributes second quarter 2026 improvement to higher Chemicals volumes, lower production and raw material costs, and prior cost-reduction actions, and reported that average TiO2 selling prices increased 4% during the first six months of 2026. The company implemented price increases and surcharges in the second quarter of 2026 in response to higher operating costs. The Real Estate segment's contribution is shrinking after the final Cadence parcel sale in October 2025.