Koppers Holdings Inc. reported net income for the Q4 2023 of $12.9 million, or $0.59 per diluted share, compared to $13.8 million, or $0.65 per diluted share, in the prior year quarter.
Adjusted net income and adjusted earnings per share (EPS) were $14.5 million and $0.67 per share for the Q4 2023, compared to $23.0 million and $1.09 per share in the prior year quarter. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) for the Q4 2023 were $53.9 million, compared with $52.1 million in the prior year quarter.
Consolidated sales of $513.2 million increased by $30.6 million, or 6.3%, compared with $482.6 million in the prior year quarter.
CEO Leroy Ball said, "We finished the year on a strong note near the top end of our adjusted EBITDA range of guidance. Once again, for the things we control, our global team did an amazing job of executing by continuing to provide our customer base with the highest-quality products and services in a challenging environment. Our diversified portfolio drove the strong performance, as our PC and RUPS business segments picked up a struggling CMC segment that continues to work through the trough of its business cycle. As always, I credit our global team for remaining focused on performing safely and at a high level, as our success begins with them."
2023 Financial Performance
FY 2024 consolidated sales of $2.15 billion, a record year, increased $174 million, or 8.8%, compared to $1.98 billion in the prior year. Net income was $89.2 million, compared with $63.4 million in the prior year. Adjusted net income was $94.0 million, compared with $88.3 million in the prior year. Adjusted EBITDA was $256.4 million, compared with $228.1 million, in the prior year.
Operating cash flows were $146.1 million, a record year, compared with $102.3 million in the prior year.
2024 Outlook
Koppers continues to expand and optimize its business and make further progress on the company's strategic pillars toward its long-term financial goals. After considering global economic conditions, as well as the ongoing uncertainty associated with geopolitical and supply chain challenges, Koppers expects 2024 sales of approximately $2.25 billion, compared with $2.15 billion in 2023. Adjusted EBITDA is anticipated to be approximately $275 million in 2024, compared with $256.4 million in 2023.
The effective tax rate for adjusted net income attributable to Koppers in 2024 is projected to be approximately 28 percent, slightly above the adjusted tax rate in 2023. Accordingly, 2024 adjusted EPS is forecasted to be in the range of $4.60 to $4.80 per share, compared with $4.36 per share in 2023.
Koppers expects operating cash flows of approximately $150 million in 2024, excluding any impact from pension termination. The company is pursuing a termination of its U.S. qualified pension plan and is targeting this effort for completion in the fourth quarter 2024. An estimated $25 million of funding will be required when this is completed, which will impact operating cash flow.
Koppers, with corporate headquarters in Pittsburgh, Pennsylvania, is an integrated global provider of treated wood products, wood treatment chemicals, and carbon compounds.
