Koppers Cuts 2026 Adjusted EBITDA Outlook

The Tip Desk · November 12, 2026 · 4 min read

Third-quarter adjusted EBITDA fell to $58.0 million as raw-material and logistics costs more than offset volume gains.

Koppers Holdings Inc. (KOP), an integrated global provider of treated wood products, wood treatment chemicals and carbon compounds, cut its 2026 adjusted EBITDA forecast to $220 million to $225 million from $240 million to $250 million after higher raw-material and logistics costs more than offset volume gains in the third quarter.

Adjusted EBITDA for the three months ended September 30 was $58.0 million, down 18.2% from $70.9 million a year earlier. Adjusted earnings were $0.77 a share, compared with $1.21. Net income was $14.7 million, or $0.75 a share diluted, versus $23.8 million, or $1.17 a share, a year earlier.

Chief Executive Officer and Chair Leroy Ball said third-quarter results reflected continued challenges in the macroeconomic environment and that higher raw-material and logistics costs were more than offsetting volume growth and structural cost improvements in the near term. The company said the year-over-year EBITDA decline was due primarily to those input costs, with selling, general and administrative expenses $3.4 million higher, mainly from compensation and technology costs.

Net sales were $499.1 million, up 2.8% from $485.3 million. The company said the increase was driven primarily by volume in residential and industrial wood preservatives, Class I crossties and U.S. utility poles, partly offset by unfavorable Class I crosstie pricing in Railroad and Utility Products and Services. Currency conversion added $6.1 million.

Railroad and Utility Products and Services sales were essentially unchanged at $232.8 million. Higher crosstie volumes and a five percent volume increase in the domestic utility pole business, including an acquisition of a western U.S. pole procurement business, were mostly offset by about $6.3 million related to the sale of a railroad services business in the third quarter of 2025 and price decreases, particularly for crossties. Adjusted EBITDA in that segment fell to $22.3 million from $29.2 million, and the adjusted EBITDA margin compressed to 9.6% from 12.5%.

Performance Chemicals was the offset. Sales rose to $161.5 million from $144.3 million on ten percent volume growth, primarily in the Americas, related to market-share gains and inventory restocking. Adjusted EBITDA increased to $29.6 million from $26.1 million, with the company citing higher volume and favorable utilization, partly offset by $4.7 million of higher raw-material costs, mainly scrap copper net of hedging.

Carbon Materials and Chemicals sales fell to $104.8 million from $108.3 million on reduced volumes, particularly carbon pitch. Adjusted EBITDA collapsed to $6.1 million from $15.6 million, and the margin fell to 5.8% from 14.4%. The company attributed the EBITDA decline to $9.0 million of higher raw-material costs and $1.7 million of lower utilization, primarily in North America, due to feedstock quality issues and the accelerated closure of the Stickney facility.

For the nine months ended September 30, operating cash flow was a record $126.9 million, compared with $77.4 million in the prior-year period. Free cash flow was a record $92.0 million, compared with $39.0 million. The company said the operating-cash-flow increase primarily reflected improved working capital and about $14 million of pension funding in the prior-year period, partly offset by lower underlying earnings. In the year-to-date period it returned $56.2 million to shareholders and reduced total debt by $31.0 million, or net debt by $35.8 million.

Koppers said it continues to expect positive volume trends and increasing benefits from operational improvement. Higher-than-anticipated raw-material and logistics costs, partially influenced by elevated energy prices, are expected to persist through the remainder of 2026, and production-network benefits are not expected to fully offset those costs and weaker end-market demand.

The company kept 2026 operating cash flow guidance at $165 million to $185 million and raised free cash flow to $115 million to $135 million from $110 million to $130 million. Adjusted EPS guidance is $3.10 to $3.25, down from $3.80 to $4.20. Net sales are now forecast at about $1.9 billion, from a prior range of $1.9 billion to $2.0 billion. Ball said commercial actions taking effect in 2027, including the accelerated Stickney closure and idling of the Florence treating plant, will help reset earnings to a meaningfully higher level.