Koppers Holdings Inc. (NYSE:KOP) Q2 2015 Earnings Conference Call Transcript
Aug 06, 2015 • 11:00 am ET
Good day, everyone, and welcome to the Koppers Holdings, Inc. Second Quarter 2015 Earnings Conference Call. Today's conference is being recorded. At this time I would like to turn the conference over to Mr. Michael Snyder. Please go ahead, sir.
Thanks, Dana. Good morning, everyone. Welcome to our second quarter earnings conference call. My name is Mike Snyder and I am the Director of Investor Relations for Koppers.
Each of you should have received a copy of our press release. If you haven't, one is available on our website or you can call Rose Hilinski at 412-227-2444 and we can either fax or email you a copy. I would also like to remind you that as indicated in our earnings release this morning we have posted materials to our investor relations website that will be referenced in today's call.
(Forward-Looking Cautionary Statements)
I'm joined on this morning's call by Leroy Ball, President and CEO of Koppers, and Mike Zugay, our Chief Financial Officer. At this time I would like to turn over the call to Leroy Ball. Leroy?
Thank you, Mike, and welcome everyone to our 2015 second-quarter conference call. Before I turn it over to Mike Zugay, I would like to spend a couple of minutes highlighting what I think were a couple of good wins for us as we finish the second quarter and head into the back half of this year. The first is our cash generation initiatives that has allowed us to pay down debt by $56 million in what has historically been our weaker half of the year for cash flow. Through the first six months this year we generated positive operating cash flow of $78 million compared to negative operating cash flow of $9 million in the first half of last year.
Even excluding the $30 million payment we received as part of the restructuring of our supply agreement with Nippon Steel's subsidiary, C-Chem, we still generated $48 million of operating cash flow through the first six months; $28 million of that coming in this quarter.
The last time that we found ourselves with at least $48 million of operating cash flow through the first six months of the year was after the second quarter of 2009, as we were responding to the global financial crisis and drawing down working capital to fit a pullback in our business at that time. Strong cash flow plus the receipt of the $30 million payment from Nippon supports my belief that we will likely finish the year at the upper end of our $100 million to $125 million debt reduction target for 2015 which is a great story.
The second area I would like to highlight of course is the stronger financial performance that we realized in the second quarter compared to last year. As expected, this was driven by strong results for both our Performance Chemicals and Railroad and Utility Products and Services business which generated adjusted EBITDA margins for the quarter of 20% and 13% respectively.