Valhi Net Income Climbs to $22.3 Million on Chemical Gains
The company reported a second-quarter net income of $0.78 per share, compared to $0.03 per share in the prior-year period.
Valhi (VHI), the diversified industrial holding company, reported a significant increase in second-quarter net income attributable to stockholders, which rose to $22.3 million.
The result reflects a recovery in the company's chemical operations and the impact of a one-time asset sale, reversing a period of lower profitability seen in the same quarter of the previous year.
Net income for the quarter reached $0.78 a share, up from $0.03 a share in the second quarter of 2024. The growth was primarily driven by the Chemicals Segment, where net sales increased 13% to $558.1 million. This gain was supported by a 16% increase in TiO2 sales volumes and approximately $10 million in favorable currency exchange rates, though these were partially offset by a 3% decline in average TiO2 selling prices and lower volumes in complementary businesses.
Operating income for the Chemicals Segment rose to $40.4 million from $10.3 million in the prior-year period. The surge was due to higher sales volumes, lower raw material and production costs, and cost reduction initiatives that were implemented in the fourth quarter of 2024. Average TiO2 selling prices showed a recovery trajectory, increasing 4% during the first six months of 2025, compared to a 2% increase in the first quarter alone.
The Component Products Segment also saw growth, with net sales rising to $43.6 million from $40.3 million. Operating income for the segment increased to $8.9 million from $6.3 million due to higher sales of marine and security components.
In contrast, the Real Estate Management and Development Segment saw net sales decrease to $4.4 million from $5.7 million as development activity slowed toward the completion of the segment's work. However, the segment recognized a one-time gain of approximately $5.8 million, or $0.10 a share, from the sale of an operational office building.
Corporate expenses fell 2% during the quarter and 5% for the first six months of 2025, primarily due to lower costs for environmental remediation. These savings were offset by higher debt levels and interest rates, which pushed interest expense up by $0.9 million in the second quarter and $2.4 million for the first half of the year.
The company also reported a $2.0 million income tax expense during the first half of 2025 related to an uncertain tax position stemming from a German tax audit in the first quarter.