Transcript • Feb. 26, 2026 4:00 PM • Koppers Holdings, Inc. (KOP)
Transcript
Feb. 26, 2026 4:00 PM
Koppers Holdings, Inc. (KOP)
Operator: The last question comes from Michael Matheson with Sidoti and Company. Please go ahead.
Michael Matheson: Good morning, you guys, and congratulations on all the margin improvement.
Leroy Ball: Thank you, Michael.
Michael Matheson: So in particular, the adjusted EBITDA margin in PC was up 370 basis points sequentially, so quite an achievement. Can you comment on what drove the upswing, and is that the new normal? Is that margin level sustainable?
Leroy Ball: Uh, so, you know, there, there's things that move around, um, if you will, right? So, uh, it's not always, you know, clean quarters, I would say. We did have, um, we did have a benefit of, of, of an asset sale that I think helped, helped their results for the quarter and probably added a, a little bit of that, um, that is, you know, something that is, is not repeatable, but, um, Overall, I'd say the margin profile, I was really pleased with what they were able to do through a challenging sales year. And I think with what we're doing moving forward, we certainly expect that we're going to be able to generate margins that are in that range on a go-forward basis. I won't necessarily commit to, again, getting back up above the 20% profile at this point. There's just still too many moving parts. And as Brad talked about relative to copper and things like that, those sorts of things we try to insulate ourselves from, but there's always some level of exposure. Sometimes we're more successful at getting greater discounts than others, and so there's a whole bunch of factors that come into play there. I guess the main point I would say is We were pleased with the overall margin performance, not just in Q4, but for the full year for PC, and expect that we'll be able to continue to generate in that range and obviously targeting to do a little bit better than that. But, you know, we think we've done a pretty good job of putting that business in a position to still consistently generate on the high end of the margin profile spectrum.
Michael Matheson: Thanks. And turning to the CMC business, you've spoken previously about potentially reducing the footprint at Stickney to a single column. Are you still planning to go ahead with that? And what would that mean for CMC margins? Is there any revenue impact from lost business?
Leroy Ball: Yeah, so it's a good question. There's a high likelihood that we will be heading in that direction because we think that there's a whole host of benefits that come about as a result of that. And in terms of what impact that would have on the revenues and profitability, nothing as it relates to 26 because of raw material that we already have in inventory that we need to run through and things of that nature. So that wouldn't be something that would be realized until we kind of really move out into 2017. The fact that we have less raw material to work with obviously means that we'll be generating less sales as a result of that. But if we move down to a single column, we think we can certainly cut costs as part of that. And as long as pricing remains stable, improve our overall margin profile for that business. That's part of the catalyst initiatives that we're continuing to do some work around, and as I have more information on that, we'll talk about that in potentially upcoming quarters.
Michael Matheson: Great, thanks. And looking at your utility pool business, I didn't see a press release about the Douglas fir acquisition, so could you just give us a little bit more color about where they're located? Will that help with your effort for geographic expansion?
Leroy Ball: Yeah. Yeah. So, yeah, small business. It's out in Oregon. And it just, it really secures up a, you know, Doug first supply chain for us that we were, you know, beginning to access out over the last 12 to 18 months. But, you know, there was a level of risk that that could potentially put us in a spot where we would be dependent upon a source that could move away from us at any point in time. And so we saw it as an opportunity to lock that in, secure that source of supply and assets and capabilities, and bring that into our portfolio, which actually we think helps improve our opportunities in some of our traditional markets where we might have been shut out of bids that would require some Doug fir component that we couldn't offer, we would need to try and work with others to be able to provide that. So right now it's more geared towards helping us in markets that we're already in and trying to grow. But, you know, it could be an initial jumping off point at some point in the future if we want to think more aggressively about expanding out further west.
Michael Matheson: Well, great. Thank you for taking my questions, and congratulations again. Thank you, Michael.
Operator: Yep. We have an additional question from Liam Burke with B-Riley Securities. Please go ahead.
Liam Burke: Thank you. Good morning, Leroy. Good morning, Brad. Good morning. Leroy, in PC, we talked about the puts and takes on residential, but are you making significant enough headway on the commercial side of the business where it's actually moving the needle and contributing to this anticipated revenue growth?
Leroy Ball: We believe so. I think if you, again, go back to our 26 projections, I think that We're happy with the commercial wins that the team generated in the back half of 25 that we'll carry into this year. It's all good business. It certainly helps us on the throughput side as well in our plants. We're a manufacturer. The more we can put through our plants, the better we're going to do. you know, you're always balancing those things out against any potential price tradeoff that you have. But throughput is king in our world. And so it's important to be able to have that volume. And so, you know, the team, again, we, you know, the team came back strong in 20, our team came back strong in 25 with a sort of a re, really a refocused effort on ensuring that, you You know, we were making sure that our customer base understood that we value, you know, what they do for us, and we want to do everything we can to not just meet their needs but exceed their needs and expectations. And I think we were able to regain some confidence in some areas. And we already had confidence in others that I think ultimately resulted in additional business coming our way, again, as certain – customers consolidated their own production activities. So I'm real happy and pleased with the efforts our PC team did in 25 coming back from a tough year.
Liam Burke: Great. In the past, you've talked about adding to the utility pole business by tucking in a pretty fragmented area. Do you see opportunities there, or has pricing got out of hand with the increasing demand for infrastructure, Bill?
Leroy Ball: I think that we're always open to those opportunities. I'm always looking, but wanting to make sure that, again, we're disciplined in that process and how we go about it. There are opportunities there, Liam. It's tough to say if and when any of them could shake loose, but in the meantime, we think we still have capacity to to fill and uh and that that opens up enough opportunities for us to continue to grow our business with the existing capacity that we have on hand and so that's you know 25 there was a tremendous amount of effort in terms of uh sort of upping upping our you know sales skills if you will and technology right so we've added technology we've added new sales leadership we've added we've added more boots on the ground um and you know we've we've gone hard in in um in areas that we feel were underrepresented and provided opportunities for us. And so, again, also pleased with the efforts of our leadership and team on the UIP side. And I think we'll continue to see, you know, those benefits come through in, you know, 26 as well.
Liam Burke: Great. Thank you, Leroy.
Leroy Ball: Thank you, Liam.
Operator: Yep. This concludes our question and answer session. I would like to turn the conference back over to CEO Leroy Ball for any closing remarks.
Leroy Ball: Thank you. I just want to thank everybody for participating on today's call and for your continued interest in coppers. Look forward to connecting with you again next quarter. Take care.
Operator: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.
