Quaker Chemical Corporation (NYSE:KWR) Q1 2018 Earnings Conference Call - Final Transcript

May 01, 2018 • 08:30 am ET


Quaker Chemical Corporation (NYSE:KWR) Q1 2018 Earnings Conference Call - Final Transcript


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Michael F. Barry

our first gain in approval on the remedy from the European Commission and then after that getting an approval for the buyer.

As we're going down this path and based on discussions with the European Commission, we decided that it would be best to go for one approval for both the remedy and the buyer at the same time. So we stopped the filing that was underway and we are now in the process of choosing the buyer for the divested product lines. We expected buyer to be chosen in the second quarter and expect to file with the European Commission for both the approval and the remedy of the buyer. The good news is that we are in general agreement with the regulatory authorities on what remedies have to be made. We currently expect regulatory approval from both the US Federal Trade Commission and the European Commission, as well as the closing to be completed over the next few months.

As we said in the past, we are excited about this combination as it will essentially double the size of the Company, enable continued above-market growth through Group cross-selling opportunities and provide at least $45 million in cost energies. Our intent is to have an investor call after the closing and provide an updated view of the new Company as well as our expected synergies.

So I believe 2018 will be an another good year for Quaker. We expect to close the combination with Houghton, see gross margin improvement and get benefits of the tax reform. In addition, we expect to see growth in our end markets in most of the regions of world, and we expect to continue to grow above the market as we have done historically through our growth initiatives and market share gains.

In closing, I want to thank all of our associates, whose dedication and expertise helps to create value for our customers and shareholders and differentiate Quaker in the marketplace. People are everything in our business and by far our most valuable asset. I am very happy with our Quaker team and continue to be excited about the upcoming combination with the Houghton International team.

And now I'll turn it over to Mary Hall, our CFO, so that she can provide you with more details behind the financials. Once Mary has completed her comments for the financials of the quarter, we will address any questions that you may have. Mary?

Mary Dean Hall

Thank you, Mike, and good morning all. Before I begin, please remember the comments made during this call include forward-looking statements, which are based on current expectations, estimates, projections and assumptions that are subjected to risks and uncertainties which may cause actual results to differ materially. For a discussion of these risks, please review the cautionary statements regarding forward looking statements included in our earnings release and the risk factors included in our 2017 Form 10-k filed with the SEC. These are available on our website.

Please refer now to Chart 4 and