Quaker Chemical Corporation Announced a 3% Increase in Net Sales of $181.7 Million

Quaker Chemical Corporation announced a 3% increase in net sales of $181.7 million for the first quarter of 2014 compared to the first quarter of 2013 net sales of $176.2 million. Foreign exchange rate translation negatively impacted net sales by 2%. 

Operating income increased 11% to $19.4 million in the first quarter of 2014 from $17.4 million in the first quarter of 2013.  Similarly, the Company's adjusted EBITDA increased 11% to $23.7 million in the first quarter of 2014 from $21.4 million in the first quarter of 2013. 

The Company's earnings per diluted share for the first quarter of 2014 were $0.96 compared to $1.04 for the first quarter of 2013 and non-GAAP earnings per diluted share for the first quarter of 2014 were $0.95 compared to $0.96 for the first quarter of 2013.  Despite strong operating results, the Company's higher effective tax rate was the primary reason its earnings were down compared to the first quarter of 2013.

First Quarter of 2014 Summary
Net sales for the first quarter of 2014 of $181.7 million increased approximately 3% from net sales of $176.2 million for the first quarter of 2013, including a decrease of approximately $2.7 million, or 2%, due to foreign exchange rate translation.  The increase in net sales from the first quarter of 2013 was primarily driven by 6% higher product volumes, including increases across most regions.

Gross profit increased approximately $2.5 million, or approximately 4%, from the first quarter of 2013, which was primarily driven by the increased sales volumes, noted above, on stable gross margins of 35.8% and 35.5% for the first quarters of 2014 and 2013, respectively.

Selling, general and administrative expenses ("SG&A") increased approximately $0.5 million from the first quarter of 2013, primarily driven by higher labor related costs and additional costs related to an amendment to the Company's pension plan in the United Kingdom ("U.K.").  The additional pension related costs are non-recurring.  Finally, these increases to SG&A were net of lower foreign currency exchange rate translation.

The change from other income of $0.3 million in the first quarter of 2013 to other expense of $0.5 million in the first quarter of 2014 was primarily the result of approximately $0.8 million of net foreign exchange losses in the current quarter.