Dallas, Texas, Aug. 07, 2025 (GLOBE NEWSWIRE) — Valhi, Inc. (NYSE:VHI) reported net income attributable to Valhi stockholders of $.9 million, or $.03 per share, in the second quarter of 2025 compared to $19.9 million, or $.70 per share, in the second quarter of 2024. For the first six months of 2025, Valhi reported net income attributable to Valhi stockholders of $17.8 million, or $.62 per share, compared to $27.7 million, or $.97 per share, in the first six months of 2024. Net income attributable to Valhi stockholders decreased in the second quarter of 2025 as compared to the same period of 2024 primarily due to lower operating results from the Chemicals Segment partially offset by higher operating results from the Real Estate Management and Development Segment. Net income attributable to Valhi stockholders decreased in the first six months of 2025 as compared to the same period of 2024 primarily due to lower operating results from the Chemicals Segment partially offset by higher operating results from the Component Products and Real Estate Management and Development Segments. As previously reported, effective July 16, 2024, the Chemicals Segment acquired the 50% joint venture interest in Louisiana Pigment Company, L.P. (“LPC”) previously held by Venator Investments, Ltd. Prior to the acquisition, the Chemicals Segment held a 50% joint venture interest in LPC. Following the acquisition, LPC became a wholly-owned subsidiary of the Chemicals Segment. We accounted for the acquisition as a business combination. The results of operations of LPC have been included in our results of operations beginning as of the acquisition date.
The Chemicals Segment’s net sales of $494.4 million in the second quarter of 2025 were $6.1 million, or 1%, lower than in the second quarter of 2024, and net sales of $984.2 million in the first six months of 2025 were $4.9 million, or 1%, higher than in the first six months of 2024. The Chemicals Segment’s net sales decreased in the second quarter of 2025 compared to the second quarter of 2024 primarily due to the effects of lower average TiO2 selling prices, changes in product mix and lower sales volumes in its export markets somewhat offset by higher sales volumes in its North American market. The Chemicals Segment’s net sales increased in the first six months of 2025 compared to the same period in 2024 due to the net effects of higher sales volumes in its North American and European markets somewhat offset by lower sales volumes in its export markets and changes in product mix. During the first six months of 2025, the Chemicals Segment and the TiO2 industry have been operating in a market impacted by global uncertainty related to U.S. trade policies, geopolitical tensions and general hesitancy by customers to build inventories which have deferred any anticipated market recovery and which have also impacted its sales volumes and pricing momentum. The Chemicals Segment started 2025 with average TiO2 selling prices 2% higher than at the beginning of 2024 but average TiO2 selling prices declined 4% during the first six months of 2025. The Chemicals Segment’s average TiO2 selling prices were 1% lower in the second quarter of 2025 as compared to the second quarter of 2024 and comparable in the first six months of 2025 as compared to the first six months of 2024. Fluctuations in currency exchange rates (primarily the euro) also affected net sales comparisons, increasing the Chemicals Segment’s net sales by approximately $8 million in the second quarter of 2025 and decreasing net sales by approximately $3 million in the first six months of 2025 as compared to the same prior year periods in 2024. The table at the end of this press release shows how each of these items impacted the Chemicals Segment’s net sales.
The Chemicals Segment’s operating income in the second quarter of 2025 was $10.3 million compared to $40.5 million in the second quarter of 2024. For the first six months of 2025, the Chemicals Segment’s operating income was $51.5 million compared to $63.3 million in the first six months of 2024. The Chemicals Segment’s operating income decreased in the second quarter of 2025 compared to the second quarter of 2024 primarily due to the effects of unfavorable fixed cost absorption due to reduced operating rates at certain of its manufacturing facilities, higher cost inventory produced in the first quarter and included in cost of sales in the second quarter and currency fluctuations (primarily the euro). The Chemicals Segment’s unabsorbed fixed production costs related to decreased production volumes in the second quarter of 2025 were approximately $20 million. The Chemicals Segment’s operating income decreased in the first six months of 2025 compared to the first six months of 2024 primarily due to the effects of approximately $18 million in additional unabsorbed fixed production costs the Chemicals Segment recognized as a result of operating its production facilities at reduced rates and a 2% increase in TiO2 sales volumes somewhat offset by lower production costs (primarily raw materials). The Chemicals Segment’s operating income in both the second quarter and first six months of 2024 includes a charge of approximately $2 million related to workforce reductions and approximately $10 million in non-cash charges primarily related to accelerated depreciation in connection with the closure of its sulfate process line in Canada in the second quarter of 2024. The Chemicals Segment operated its production facilities at overall average capacities of 87% of practical capacity utilization in the first six months of 2025 (93% and 81% in the first and second quarters of 2025, respectively) compared to 93% in the first six months of 2024 (87% and 99% in the first and second quarters of 2024, respectively). Fluctuations in currency exchange rates (primarily the euro) increased the Chemicals Segment’s operating income by approximately $14 million in the second quarter of 2025 and approximately $9 million in the first six months of 2025 as compared to the same prior year periods.
The Component Products Segment’s net sales were $40.3 million in the second quarter of 2025 compared to $35.9 million in the second quarter of 2024 and $80.6 million in the first six months of 2025 compared to $73.9 million in the same period of 2024. The Component Products Segment’s net sales increased in the second quarter and for the first six months of 2025 compared to the same periods in 2024 due to higher security products sales primarily to the government security market and higher marine components sales to the government and towboat markets. Operating income attributable to the Component Products Segment was $6.3 million in the second quarter of 2025 compared to $5.1 million in the second quarter of 2024 and $12.2 million in the first six months of 2025 compared to $8.8 million for the same prior year period. The Component Products Segment’s operating income increased in the second quarter and for the first six months of 2025 compared to the same periods in 2024 due to higher sales and gross margin at each of the security products and marine components reporting units.
The Real Estate Management and Development Segment had net sales of $5.7 million in the second quarter of 2025 compared to $23.3 million in the second quarter of 2024. For the first six months of 2025 the Real Estate Management and Development Segment had net sales of $14.2 million compared to $37.1 million in the same period of 2024. Land sales revenue is generally recognized over time based on cost inputs, and land sales revenues are dependent on spending for development activities. All of the land sales revenues recognized in 2025 and 2024 are related to land sold prior to 2024. Land sales revenues in the second quarter and first six months of 2025 decreased compared to the same periods in 2024 due to the decreased pace of development activity for previously sold parcels within the residential/planned community, primarily due to delays in obtaining city permits and environmental approvals. The pace of development activities is dictated by a number of factors such as city permit and design approval, approvals from the Nevada Department of Environmental Protection, and labor and materials availability. The Real Estate Management and Development Segment also recognized tax increment infrastructure reimbursements of $17.2 million ($8.9 million, or $.31 per share, net of income tax and noncontrolling interest) in the second quarter of 2025 which is included in operating income.
Corporate expenses were 11% lower in the second quarter of 2025 compared to the same period in 2024 primarily due to lower litigation fees and related costs and lower environmental remediation and related costs. Corporate expenses were 5% lower in the first six months of 2025 compared to the same period in 2024 primarily due to lower litigation fees and related costs. Interest income and other decreased $1.8 million in the second quarter and $3.2 million in the first six months of 2025 compared to the same periods of 2024 primarily due to lower average interest rates and decreased cash balances. Interest expense increased $1.9 million in the second quarter of 2025 compared to the same period in 2024 primarily due to higher overall debt levels. Interest expense increased $3.8 million in the first six months of 2025 compared to the same period in 2024 primarily due to higher overall debt levels and higher average interest rates as a result of Kronos debt transactions entered into in 2024. In addition, interest expense in the first six months of 2024 includes a charge of $1.5 million for the write-off of deferred financing costs at the Chemicals Segment.
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;
- Our ability to realize expected cost savings from strategic and operational initiatives;
- Our ability to integrate acquisitions, including LPC, into Kronos’ operations and realize expected synergies and innovations;
- 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), including as a result of additional or changed tariffs on imported raw materials;
- 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 and energy 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, tariffs, …