Breaking Down Kronos Worldwide, Inc. (KRO) Financial Health: Key Insights for Investors

You're looking at Kronos Worldwide, Inc. (KRO) and seeing a deeply confusing 2025, which is why you need to dig into the financials before making a move. Here's the quick math: the year started strong, with Q1 net income soaring by 123% year-over-year to $18.1 million on net sales of $489.8 million, but that momentum evaporated, leading to a Q2 net loss of $9.2 million. The real shock came in Q3, when the company reported a net loss of $37.0 million on revenue of just $456.9 million, missing analyst estimates substantially, which shows the titanium dioxide (TiO2) pigment market is still struggling with pricing and volume. This sharp reversal, plus the standing debt of approximately $610.6 million, is creating a massive divergence in Wall Street sentiment, with price targets for the stock ranging from a low of $6.00 to a high of $7.50. You need to understand if the full-year consensus loss of $0.03 per share is the defintive bottom or just a waypoint in a prolonged cycle, and we'll show you exactly where the near-term risks and opportunities lie in the full breakdown.

Revenue Analysis

You're looking for a clear picture of what drives Kronos Worldwide, Inc. (KRO)'s top line, and the data from 2025 is defintely mixed. The direct takeaway is that Kronos Worldwide, Inc. is almost entirely a single-product company, and its revenue stability hinges on the global Titanium Dioxide (TiO₂) market's pricing and volume dynamics, which have been choppy this year.

As of September 30, 2025, the company's trailing twelve-month (TTM) revenue stood at approximately $1.86 billion. This TTM figure shows a marginal year-over-year growth of just 0.01%, which tells you the market is essentially flatlining after a volatile period. The story here is less about massive expansion and more about weathering market headwinds.

The company's revenue streams are straightforward, but the regional performance is not. Kronos Worldwide, Inc. operates in a single reportable segment: Titanium Dioxide Pigments. That's it. This white inorganic pigment is used in everything from coatings on cars and appliances to plastics for packaging and houseware.

Here's the quick math on quarterly performance, which shows the near-term risk:

• Q1 2025 Net Sales: $489.8 million (2% increase year-over-year).
• Q2 2025 Net Sales: $494.4 million (1% decrease year-over-year).
• Q3 2025 Revenue: $456.90 million (5.74% decrease year-over-year).

The first half of 2025 saw net sales of $984.2 million, a 1% increase over the same period in 2024, but the third quarter's sharp decline shows pricing pressure is back. You must watch the average selling prices for TiO₂; they declined 3% during Q1 2025 due to market pressure, and lower prices were a primary factor in the Q2 and Q3 dips.

The regional breakdown is also critical. While North American sales volumes have been a bright spot, offsetting some declines, the European and export markets have seen reduced sales volumes. The United States remains the greatest single contributor to the overall revenue figure. Also, currency fluctuations, primarily the euro, acted as a real headwind, decreasing net sales by about $11 million in the first quarter of 2025 alone. That's a direct hit to the top line. For a deeper dive into the company's financial structure, check out Breaking Down Kronos Worldwide, Inc. (KRO) Financial Health: Key Insights for Investors.

The only structural change of note is the full consolidation of Louisiana Pigment Company, L.P. (LPC) starting in July 2024. This acquisition, now fully integrated, is expected to help realize synergies and bolster results, but its full impact is being masked by the volatile pricing environment.

Next step: Monitor the company's Q4 2025 earnings call for management's outlook on TiO₂ pricing and demand in North America versus export markets.

Profitability Metrics

You need to know the core profitability of Kronos Worldwide, Inc. (KRO) to assess its ability to generate returns from its titanium dioxide (TiO₂) operations. The direct takeaway for the first half of 2025 is that KRO's overall profitability is razor-thin, with a significant margin contraction in the second quarter driven by operational inefficiency.

For the first six months of 2025 (H1 2025), Kronos Worldwide reported total Net Sales of $984.2 million. The company's Net Income for this period was only $8.9 million, translating to a Net Profit Margin of just 0.90%. That's a very small cushion for a cyclical business.

Here's the quick math on the key margins for H1 2025:

• Gross Profit Margin: 17.23% ($169.6 million Gross Profit / $984.2 million Net Sales).
• Operating Profit Margin: Approximately 4.70% ($46.3 million Operating Profit / $984.2 million Net Sales).
• Net Profit Margin: 0.90% ($8.9 million Net Income / $984.2 million Net Sales).

Trends in Profitability Over Time

The trend from Q1 to Q2 2025 is the most critical factor, showing a sharp deterioration. Kronos Worldwide started the year strong with a Q1 Net Income of $18.1 million, but that quickly reversed into a Net Loss of $9.2 million in Q2 2025. This volatility is typical for a commodity-linked business, but the speed of the decline is a clear near-term risk. The gross margin dollar amount, for instance, fell from $106.8 million in Q1 to $62.8 million in Q2.

This drop is a direct result of operational challenges, not just market pricing. The company's production capacity utilization, a key measure of operational efficiency, plummeted from 99% in Q2 2024 to 81% in Q2 2025. This 18-percentage-point drop left an estimated $20 million in unabsorbed fixed production costs, meaning the company paid for factory capacity it didn't fully use, which directly lowered the Gross Profit.

Industry Comparison and Operational Efficiency

Kronos Worldwide operates in the Specialty Chemicals sector, which has been under pressure, with net profit margins remaining low in the first half of 2025, after a sharp drop in 2023. KRO's H1 2025 Net Profit Margin of 0.90% is significantly below the historical average for the broader chemical industry, which averaged 5.8% between 2000 and 2020. This confirms the company is currently operating at the low end of the industry's profitability cycle.

The titanium dioxide (TiO₂) market structure also impacts KRO's margins. As a non-integrated pigment plant, Kronos Worldwide sees its gross margins compressed because it lacks captive mines to offset spikes in feedstock costs. Vertically integrated competitors, like Tronox, are better positioned to weather these raw material price swings. To improve, KRO must defintely continue to optimize its cost management and leverage the full control it gained over the Louisiana Pigment Company, L.P. joint venture, which was fully acquired in July 2024. You can see how this fits into the bigger picture of the company's strategy by reviewing their Mission Statement, Vision, & Core Values of Kronos Worldwide, Inc. (KRO).

Your action is to monitor Q3 2025 and Q4 2025 results closely for a rebound in production utilization; a sustained rate below 90% signals a structural problem with cost absorption that will keep margins weak.

Debt vs. Equity Structure

You need to know exactly how Kronos Worldwide, Inc. (KRO) is funding its operations, especially in a cyclical industry like titanium dioxide (TiO2). The direct takeaway is that the company is moderately leveraged, but its recent refinancing activity and a significant credit rating downgrade signal a clear shift toward higher-cost debt to manage near-term obligations.

As of June 2025, Kronos Worldwide, Inc.'s total debt stood at approximately $611 million, which is a combination of short-term and long-term obligations. Specifically, the company held around $92 million in Short-Term Debt and Capital Lease Obligations, plus $519 million in Long-Term Debt and Capital Lease Obligations. This debt load is set against a Total Stockholders' Equity of $847 million.

Here's the quick math on leverage:

• Debt-to-Equity Ratio: 0.72 (as of June 2025)
• Specialty Chemicals Industry Average: Approximately 0.65

A Debt-to-Equity (D/E) ratio of 0.72 means that for every dollar of shareholder equity, Kronos Worldwide, Inc. uses 72 cents of debt to finance its assets. Compared to the Specialty Chemicals industry average of around 0.65, Kronos Worldwide, Inc. is slightly more aggressive in its use of financial leverage. This isn't an alarming number in a capital-intensive sector, but it does mean earnings are more volatile due to the additional interest expense. The company is defintely leaning on debt to maintain its scale.

In terms of financing strategy, Kronos Worldwide, Inc. is actively managing its debt maturity schedule. In September 2025, the company announced a private offering of an additional €75 million (approximately $91.9 million) of 9.50% Senior Secured Notes due 2029. The primary purpose was to pay off the 3.75% Senior Secured Notes that were maturing on September 15, 2025. This is a crucial data point: they successfully refinanced, but at a significantly higher interest rate, moving from 3.75% to 9.50% on that portion of the debt. That's a massive jump in the cost of capital.

This refinancing activity, while necessary to avoid a maturity default, aligns with the negative sentiment from credit rating agencies. In September 2025, S&P Global Ratings lowered the issuer credit rating on a subsidiary, Kronos Acquisition Holdings Inc., to 'CCC' from 'CCC+', citing tightening liquidity and weak operating performance. This 'CCC' rating implies a substantial risk of default, which is why the new debt carries such a high coupon. The balance is shifting away from cheaper debt and toward higher-cost financing to bridge operational challenges.

For a deeper dive into the company's major shareholders and market sentiment, you should read Exploring Kronos Worldwide, Inc. (KRO) Investor Profile: Who's Buying and Why?

Here is a snapshot of the key financial leverage metrics:

Liquidity and Solvency

You need to know if Kronos Worldwide, Inc. (KRO) can cover its near-term bills, especially with the titanium dioxide (TiO2) market facing global headwinds. The simple answer is yes, for now, but the cash flow trends are flashing a clear warning sign. The company's liquidity ratios look defintely solid on paper, but a closer look at the cash flow statement shows a significant reversal in operational cash generation for the first nine months of 2025.

The core liquidity metrics, the Current Ratio and Quick Ratio, show a strong buffer. The Current Ratio, which measures current assets against current liabilities, sits at a healthy 3.83. This means Kronos Worldwide, Inc. has $3.83 in short-term assets for every dollar of short-term debt. The Quick Ratio, a tougher test that excludes less-liquid inventory, is also solid at 1.30. Anything over 1.0 is generally good; they can cover immediate obligations without selling a single pigment bag.

Working Capital and Cash Flow Reversal

Still, the trends in working capital tell a different, more concerning story. Working capital is the capital available to a business for its day-to-day operations. For the first nine months of 2025 (9M 2025), Kronos Worldwide, Inc.'s cash flow from operations was hit hard, showing a net cash used of $89.6 million. This is a massive swing from the $23.2 million in cash provided by operations during the same period in 2024, representing a $112.8 million increase in cash used.

Here's the quick math on what drove that operational cash drain:

• Lower income from operations: $67.7 million impact.
• Higher cash used for working capital changes (inventories, receivables, payables): $23.9 million impact.
• Higher cash paid for interest: $12.8 million impact due to higher debt and rates.

This negative operational cash flow means the company is currently funding its day-to-day business by drawing down on existing cash or increasing debt, not from selling its core product. That's not sustainable in the long run.

Investing and Financing Cash Flow Trends

The Investing Cash Flow (ICF) side reflects the company's capital spending. Over the trailing twelve months (TTM), the ICF was a net outflow of approximately $201.4 million. A significant chunk of this was for cash acquisitions, totaling about $156.8 million, which is a one-time strategic investment to enhance future capabilities, not a recurring expense. Capital expenditures (CapEx) for plant and equipment, a recurring item, were approximately $45.00 million over the TTM period, which is a manageable amount relative to their asset base.

On the Financing Cash Flow (FCF) side, the company is managing its debt. They paid a $4.4 million cash premium on the issuance of senior notes during the 9M 2025 period, a move to restructure or raise capital. The higher interest payments of $12.8 million are a direct result of increased debt levels and the higher interest rate environment, which eats into their overall cash position.

The table below summarizes the critical cash flow shift:

The key takeaway is that while Kronos Worldwide, Inc.'s balance sheet liquidity is strong, its operating cash flow has deteriorated sharply in 2025. This means the strong ratios are being supported by past cash reserves, not current operational performance. Investors must watch for a reversal in the operating cash flow in the next few quarters. For a more detailed look at the full financial picture, you can read the full post at Breaking Down Kronos Worldwide, Inc. (KRO) Financial Health: Key Insights for Investors.

Valuation Analysis

You're looking at Kronos Worldwide, Inc. (KRO) and wondering if the stock's recent plunge makes it a bargain or a value trap. The quick answer is that KRO appears undervalued on a Price-to-Book (P/B) basis, but the fundamental earnings picture and analyst sentiment point to significant near-term risks, suggesting it is defintely not a clear-cut buy.

As of November 2025, the stock trades at a fraction of its book value, but its negative earnings per share (EPS) for the trailing twelve months (TTM) complicate the picture. This is a classic case where a low valuation multiple is a signal of distress, not just a discount.

Is Kronos Worldwide, Inc. (KRO) Overvalued or Undervalued?

When we look at the core valuation multiples, Kronos Worldwide, Inc. presents a mixed signal. The Price-to-Book (P/B) ratio, which compares the stock price to the company's net asset value, is exceptionally low at just 0.63. A P/B below 1.0 often suggests a stock is undervalued, meaning you are buying the company's assets for less than their accounting value. But here's the quick math on profitability multiples:

• Price-to-Earnings (P/E) Ratio: The TTM P/E ratio is 8.14 as of early November 2025. This is low, but it's calculated on a small, positive TTM EPS of $0.58. The forward P/E, based on expected future earnings, is higher at 13.36.
• Enterprise Value-to-EBITDA (EV/EBITDA): This ratio, which looks at the company's total value (including debt) relative to its operating cash flow, sits at 10.05. This is a reasonable number, but it highlights the impact of the company's substantial debt on the overall enterprise value ($1.12 billion) compared to its market capitalization ($503.93 million).

The P/B ratio is the only truly compelling number here. The stock is cheap, but for a reason.

Stock Price and Analyst Sentiment

The market has clearly punished Kronos Worldwide, Inc. over the last year. The stock has seen a dramatic drop of over 61% in the 52 weeks leading up to November 2025. The 52-week trading range tells the story of a falling knife, moving from a high of around $11.97 down to a recent low of $4.08. That's a massive loss of investor confidence.

This negative momentum is reflected in the Wall Street consensus. Analysts are not optimistic, which is a near-term headwind. Out of four Wall Street research analysts, the consensus rating is a Strong Sell. Still, the average 12-month price target is $6.50, which implies a potential upside of over 43% from the recent price of $4.54. This gap suggests analysts see a significant correction or rebound, but their 'Sell' rating is a strong warning about the path to get there.

For more depth on institutional positioning, you should read Exploring Kronos Worldwide, Inc. (KRO) Investor Profile: Who's Buying and Why?

Dividend Health and Payout Risk

The dividend looks attractive on the surface, but a deeper look reveals it is not currently covered by earnings. Kronos Worldwide, Inc. pays an annual dividend of $0.20 per share, which translates to a high dividend yield of about 4.52%. This is significantly higher than the US market average.

However, the dividend payout ratio, which measures the percentage of earnings paid out as dividends, is a major red flag. Based on TTM negative earnings, one calculation of the payout ratio is an unsustainable -57.1%. This means the company is paying the dividend out of its balance sheet, not from current profits. This is the definition of a high-risk dividend; it's a capital return policy that is not sustainable without a rapid return to profitability. The company needs to turn its earnings around fast, or the dividend is at risk of a cut.

Next Step: Review the Q3 2025 earnings report to assess the titanium dioxide market outlook and management's commentary on 2026 profitability forecasts.

Risk Factors

You need a clear view on what's driving Kronos Worldwide, Inc. (KRO)'s recent performance, and honestly, the risks are currently outweighing the opportunities. The company's financial health has deteriorated sharply in the back half of 2025, swinging to a net loss for the first nine months of the year. This isn't just a cyclical dip; it's a confluence of market, operational, and legislative headwinds.

For the first nine months of 2025, Kronos Worldwide reported a net loss of $28.1 million, a major reversal from the $99.4 million net income in the same period of 2024. That's a massive drop in profitability.

Market and Pricing Pressure (External Risks)

The core issue is the titanium dioxide (TiO2) market. Demand has been soft, driven by global uncertainties, geopolitical tensions, and customers being hesitant to build inventory. This has put severe pressure on pricing, which is the lifeblood of a commodity chemical producer like Kronos Worldwide.

Average TiO2 selling prices decreased by 7% in the third quarter of 2025 compared to the prior year. This pricing weakness directly translated into a 6% year-over-year drop in Q3 net sales to $456.9 million. Also, the global market is intensely competitive, with low-cost producers in China holding significant excess capacity, which limits Kronos Worldwide's ability to raise prices even if demand recovers slightly.

• Average TiO2 prices fell 7% in Q3 2025.
• Geopolitical tensions prolong market uncertainty.
• Raw material cost volatility remains a constant challenge.

Operational and Financial Headwinds

The market issues are creating a nasty feedback loop on the operational side. Because demand is down, Kronos Worldwide has had to cut production volumes, which means their fixed manufacturing costs are spread over fewer tons of product-a problem called unfavorable fixed cost absorption.

The TiO2 segment, the company's sole revenue driver, swung from a profit of $43.4 million in Q3 2024 to a loss of $15.3 million in Q3 2025. Their capacity utilization in Q3 2025 was only 80%, down from 92% in the same quarter last year. When you run a plant at 80% capacity, your per-unit cost skyrockets. Plus, fluctuations in currency exchange rates, primarily the euro, continue to impact sales and profitability because of the company's global footprint.

Legislative and Regulatory Risks

A less obvious, but significant, risk is the regulatory environment. In Q3 2025, Kronos Worldwide recorded a non-cash deferred tax expense of $19.3 million. This was a direct result of new German legislation that reduced corporate tax rates. While a lower tax rate is good long-term, the accounting adjustment for deferred tax liabilities hit the Q3 income statement hard. You also have the ongoing regulatory divergence in Europe, where TiO2 powder is subject to mandatory Category 2 carcinogen warnings, which forces product portfolio adjustments and can temper demand growth.

This tax charge didn't affect cash flow, but it defintely widened the reported net loss.

Mitigation Strategies and Clear Actions

Management recognizes the problem and is taking clear, tactical steps. They are focused on stabilizing the business by better aligning production with current, subdued demand.

The primary action is a further reduction in operating rates in the fourth quarter of 2025 to reduce inventory levels. This is a necessary, albeit painful, short-term move to improve operating cash flows and boost liquidity. They are also implementing additional cost reduction initiatives across the organization to improve the overall cost structure. For a deeper look at the company's long-term vision, check out the Mission Statement, Vision, & Core Values of Kronos Worldwide, Inc. (KRO).

• Reduce operating rates in Q4 2025 to cut inventory.
• Implement additional cost reduction initiatives.
• Focus on boosting liquidity to weather the downturn.

Growth Opportunities

You need to know where Kronos Worldwide, Inc. (KRO) is headed, and the picture is mixed right now, honestly. The core growth driver is the full integration of a major strategic acquisition, but near-term market headwinds-specifically falling titanium dioxide (TiO2) prices-are defintely muting the financial impact in 2025.

The biggest strategic move was the July 2024 acquisition of the remaining 50% interest in Louisiana Pigment Company, L.P. (LPC), making it a wholly-owned subsidiary. This facility is the newest chloride-process TiO2 plant in the Western world, which is a huge competitive edge. Full ownership lets Kronos Worldwide, Inc. expand its product offerings and implement process innovations to boost efficiency, adding an estimated 156,000 metric tons of annual TiO2 production capacity.

Here's the quick math on the 2025 reality: The first nine months of 2025 saw net sales of $1.4 billion, which was a 2% decline from the same period in 2024. More critically, the company reported a net loss of $28.1 million, or -$0.24 per share, for the first nine months of 2025, a sharp reversal from the prior year. This is mostly due to a 6% decline in average TiO2 selling prices during the period and lower plant operating rates in Q2 and Q3.

The market is tough, but the company has a few clear advantages that position it for a future upturn:

• Product Range: Kronos Worldwide, Inc. offers a broad portfolio of over 50 different TiO2 pigment grades, catering to diverse needs in coatings, plastics, and paper.
• Operational Strength: The first quarter of 2025 showed what's possible, with net income doubling to $18.1 million on the back of 18% higher production volumes and lower per-metric-ton costs.
• Geographic Reach: Strong sales volumes in North American and European markets, which somewhat offset weaker export market demand.

What this estimate hides is the structural issue of vertical integration (or lack thereof). Kronos Worldwide, Inc. is the world's fourth-largest TiO2 producer, but it must purchase rutile ores for its chloride process. So, when TiO2 demand rises, a lot of the profit upside flows to the ore miners, not to Kronos Worldwide, Inc. The debt load is also a risk, with a debt-to-equity ratio of 68%, significantly above the industry median of 36%, and the refinancing of debt at a higher 9.50% rate will cut into future free cash flow.

For a deeper dive into the Q3 results, check out the full analysis: Breaking Down Kronos Worldwide, Inc. (KRO) Financial Health: Key Insights for Investors.

The near-term outlook is challenging, as evidenced by the Q3 2025 net loss of $37.0 million on sales of $456.90 million. The market needs to stabilize and prices need to firm up before the LPC acquisition truly translates into significant earnings growth.

Here's a snapshot of the 2025 quarterly performance to date:

The action item for you is to watch the Q4 2025 report for any sign of a price floor forming, and look for specific updates on the LPC integration synergies. That's the real catalyst.