Northern Technologies International (NASDAQ:NTIC) Releases Quarterly Earnings Results, Misses Estimates By $0.06 EPS

Northern Technologies International (NASDAQ:NTIC) posted its quarterly earnings data on Thursday. The specialty chemicals company reported ($0.02) EPS for the quarter, missing the consensus estimate of $0.04 by ($0.06), FiscalAI reports. Northern Technologies International had a negative net margin of 0.87% and a positive return on equity of 0.05%. The company had revenue of $24.22 million during the quarter, compared to the consensus estimate of $23.40 million.

Here are the key takeaways from Northern Technologies International’s conference call:

• Record quarterly consolidated sales rose 12.6% year over year to $24.2 million, marking the second straight quarter of double-digit growth. Management said demand was strong across ZERUST and Natur-Tec, with joint venture sales also up 15.1%.
• Gross margin was pressured by a sharp increase in raw material costs tied to Middle East shipping disruptions, cutting gross margin by about 477 basis points year over year. The company said gross profit was hurt by roughly $1 million and expects the pressure to be temporary.
• ZERUST oil and gas momentum remained strong, with sales up 72.3% to a quarterly record of $2.2 million and trailing-12-month sales topping $10 million for the first time. Management also highlighted a growing pipeline in the Middle East, North America, India, and China.
• Natur-Tec posted a quarterly record of $6.1 million in sales, up 5% year over year, while management cited new opportunities in food packaging and Bayer-related seedling cup trials in India. The company believes these higher-value applications could support future margin expansion and growth.
• Liquidity remained solid with $7.3 million in cash and $20 million of working capital, though debt rose to $14.8 million and the company is planning to sell its Beachwood, Ohio facility for about $1.15 million. Management expects sequential gross margin improvement and stronger fourth-quarter profitability as pricing actions and cost relief flow through.

Northern Technologies International Trading Down 3.7%

Shares of NTIC stock opened at $8.26 on Friday. The firm has a 50 day moving average price of $8.15 and a two-hundred day moving average price of $8.41. The company has a quick ratio of 1.15, a current ratio of 1.81 and a debt-to-equity ratio of 0.01. The company has a market capitalization of $78.39 million, a PE ratio of -103.25 and a beta of 0.17. Northern Technologies International has a 12-month low of $7.14 and a 12-month high of $10.03.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently added to or reduced their stakes in the company. Osaic Holdings Inc. grew its stake in shares of Northern Technologies International by 1,124.1% in the second quarter. Osaic Holdings Inc. now owns 3,501 shares of the specialty chemicals company’s stock valued at $26,000 after acquiring an additional 3,215 shares in the last quarter. Qube Research & Technologies Ltd acquired a new position in shares of Northern Technologies International during the 2nd quarter worth approximately $88,000. XTX Topco Ltd acquired a new position in Northern Technologies International in the 4th quarter valued at $96,000. Arrowstreet Capital Limited Partnership bought a new position in shares of Northern Technologies International in the second quarter worth about $130,000. Finally, Squarepoint Ops LLC lifted its holdings in shares of Northern Technologies International by 57.5% during the third quarter. Squarepoint Ops LLC now owns 23,011 shares of the specialty chemicals company’s stock worth $177,000 after purchasing an additional 8,401 shares during the period. 32.88% of the stock is owned by institutional investors and hedge funds.

Analyst Ratings Changes

A number of equities analysts have weighed in on NTIC shares. Weiss Ratings reaffirmed a “sell (d)” rating on shares of Northern Technologies International in a research report on Wednesday, June 24th. Zacks Research upgraded shares of Northern Technologies International from a “strong sell” rating to a “hold” rating in a report on Tuesday, June 9th. One investment analyst has rated the stock with a Hold rating and one has assigned a Sell rating to the company. According to MarketBeat, the company currently has a consensus rating of “Reduce”.

About Northern Technologies International

Northern Technologies International Corporation (NASDAQ: NTIC) is a Minnesota‐based specialty chemical company that develops, manufactures and markets environmentally responsible corrosion prevention and metal surface treatment products. The company’s solutions include volatile corrosion inhibitor (VCI) films, emitters, powders and liquids designed to protect ferrous and non‐ferrous metals in industrial, aerospace, defense, electronics and automotive applications. In addition, NTIC offers packaging materials, engineered coatings and specialty pretreatment chemicals that meet stringent environmental regulations while extending equipment life and reducing maintenance costs.

NTIC serves a diversified global customer base, including metal fabricators, automotive suppliers, electronics manufacturers and oil and gas producers.