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Edited Transcript of KWR earnings conference call or presentation 1-Mar-19 1:30pm GMT

Q4 2018 Quaker Chemical Corp Earnings Call

CONSHOHOCKEN Mar 6, 2019 (Thomson StreetEvents) -- Edited Transcript of Quaker Chemical Corp earnings conference call or presentation Friday, March 1, 2019 at 1:30:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Mary Dean Hall

Quaker Chemical Corporation - CFO, VP & Treasurer

* Michael F. Barry

Quaker Chemical Corporation - Chairman of the Board, CEO & President

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Conference Call Participants

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* Daniel Dalton Rizzo

Jefferies LLC, Research Division - Equity Analyst

* Edward James Marshall

Sidoti & Company, LLC - Senior Equity Research Analyst

* Garo Norian

Palisade Capital Management LLC - SVP of Research

* Jonathan E. Tanwanteng

CJS Securities, Inc. - MD

* Michael Joseph Harrison

Seaport Global Securities LLC, Research Division - MD & Senior Chemicals Analyst

* Rosemarie Jeanne Pitras-Morbelli

G. Research, LLC - Research Analyst

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Presentation

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Operator [1]

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Greetings, and welcome to the Quaker Chemical Corporation Fourth Quarter and Full Year 2018 Results Conference Call. (Operator Instructions) As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Michael Barry, Chairman, Chief Executive Officer and President for Quaker Chemical Corporation. Thank you, Mr. Barry. You may begin.

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Michael F. Barry, Quaker Chemical Corporation - Chairman of the Board, CEO & President [2]

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Thanks, Melissa. Good morning, everyone. Joining me today are Mary Hall, our CFO; and Robert Traub, our General Counsel. After my comments, Mary will provide the details around the financials, and then we'll address any questions that you may have. We also have slides for the conference call. You can find them in the Investor Relations section of the website at www.quakerchem.com.

I'll start off now with some remarks about the fourth quarter. I'm pleased that we have delivered another good quarter despite some market challenges. The primary challenges we faced were greater foreign exchange headwinds, a slowdown in automotive in Europe and China and some higher-than-normal manufacturing costs, which impacted our gross margins.

Let me now expand on each of these areas. Foreign exchange negatively impacted our revenues by 3%, which led to our flat sales for the quarter despite volume growth of 2% and price mix improvement of 1%. While our overall volumes grew, our underlying markets were negatively impacted by lower automotive sales, especially in Europe and China.

Specifically, global car production was down approximately 5% in the fourth quarter of 2018 versus the fourth quarter of 2017, which highlights the sizable challenge we overcame through our market share gains in the quarter. Gross margins are both a positive and negative story. While we're up to 35.4% in the current quarter compared to 35.1% in 2017, we were below our expectation of being around 36%. As I mentioned, shortfall from expectations was largely driven by our manufacturing costs and variances being higher than normal rather than higher raw material costs, which were relatively stable, sequentially. We expect that these manufacturing costs will normalize in the first quarter, and our gross margin is expected to be in the 36% range next quarter.

Let me now give you some additional color on our regions' performance for the quarter. Our biggest segment, North America, had a very strong quarter and showed a sales increase of 5% with 2% volume growth and 4% due to price increases and mix, partially offset by 1% negative impact due to foreign exchange. Our European, or EMEA, region showed a 5% decrease, primarily due to negative foreign exchange impact of 3% and lower volumes of 2%. You may recall that in the middle of 2018, we stopped selling a piece of business to a nonstrategic customer, primarily due to its low profitability. This impacted volume growth by about 1% and, therefore, was half of EMEA's volume decline. In our Asia Pacific region, our sales increased 1% as we continued to see good volume growth of 8%, but this was partially offset by foreign exchange of 5% and negative price mix impacts of 2%. So our Asia Pacific region continued to show good organic growth and produce strong results for us even with the slowdown in China's automotive market. For South America, we showed a decline in revenue of 9% despite positive volume growth of 2% and a price mix improvement of 3%. So the sales decline was all due to the year-over-year negative foreign exchange impact of 14%. Overall, volume growth continues to be a consistent theme for us, and increases in our market share continues to be a large driver of this volume growth. One way to see our market growth and market share gains is to look at the overall organic volume growth in the quarter and compare that to the underlying production growth in our base industrial end markets. Our volume growth was 2% in the quarter as compared to the underlying growth in our base markets, which we estimate as flat at best, with steel up and automotive down. We believe this spread of approximately 2% is indicative of our share gains and is due to our commitment to our customer intimacy model. Specifically, we put our customer needs first as our top priority, providing them with strong service and business solutions. I believe this approach continues to differentiate us in the marketplace.

So in summary, despite the challenges we faced in the quarter, including foreign exchange and lower automotive production in China and Europe, we were able to grow our non-GAAP earnings by 19%. For the full year 2018, we grew our adjusted EBITDA by 9% and our non-GAAP earnings by 21%. In a nutshell, we were able to do this by taking share in the marketplace, increasing our gross margins and continuing to leverage our SG&A.

I would now like to make a few remarks about our combination with Houghton International. Since our update on January 8, we continue to be in productive discussions with the FTC although the progress was somewhat delayed by the government shutdown. Our expectation is that we will be able to receive regulatory approval and close within the next few months. Overall, the magnitude of the divested product lines continues to be about 3% of the combined revenue of the companies. As I said in the past, we are excited about this combination as it will double the size of the company, enable continued above-market growth through good cross-selling opportunities and provide at least $45 million in cost synergies. Our intent is to have an investor call after the closing, where we'll provide an updated view of the new company, including our expected synergies.

Looking forward, I'm very pleased with the future outlook for Quaker. We had a very strong 2018, and we expect 2019 to be another good year for us despite challenging market conditions, as we expect our current Quaker business to continue year-over-year growth in non-GAAP earnings and adjusted EBITDA despite currency headwinds and low growth in our base markets of automotive and steel.

We will do this by continuing to grow above the market as we have done historically through our growth initiatives and market share gains. And of course, we also expect to begin realizing the benefits from combining with Houghton. So all in all, I continue to be confident in our future.

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'm 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 on the financials for the quarter, we'll address any questions that you may have. Mary?

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Mary Dean Hall, Quaker Chemical Corporation - CFO, VP & Treasurer [3]

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Thank you, Mike, and good morning all. Before I begin, please remember that comments made during this call include forward-looking statements, which are based on current expectations, estimates, projections and assumptions that are subject 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 2018 Form 10-K filed with the SEC. These are available on our website. In addition, please note that Quaker provides certain information, including non-GAAP earnings per diluted share and adjusted EBITDA in an effort to provide shareholders with better visibility into Quaker's core operations, excluding certain onetime items that we believe do not reflect our core operations. Reconciliations are provided in Chart 10 through 12 of this investor deck, and they are also in yesterday's earnings release and filing of Form 10-K with the SEC. Also please note that we've added the Chart 13 in the appendix to summarize segment performance.

Q4 performance continued to demonstrate Quaker's resilience and consistency in the face of volatile markets. In Q4, we faced several market challenges, including generally weaker industrial production, particularly in automotive Q4-over-Q4 as well as continued FX headwinds that surfaced in Q3. Despite these challenges, our non-GAAP earnings per diluted share increased 19% in Q4 to $1.51 with the full year increasing 21% to $6.04. And our full year adjusted EBITDA of $125.6 million was a record.

Please now refer to Charts 4 and 5 as I review our Q4 and full year 2018 financial performance in more detail.

Net sales were up slightly, Q4-over-Q4 to $211.5 million and volume growth of 2% and price mix improvement of 1% were largely offset by a 3% negative impact from foreign currency translation as we saw a stronger dollar across the globe. For the full year, net sales were up 6% due to volume increases of 3% and price mix improvement of 2% with a slight positive impact from foreign exchange. Our gross margin improved Q4-over-Q4 to 35.4% from 35.1% but was down, sequentially, from Q3's 36.5% as we experienced certain elevated costs in Q4 largely related to manufacturing that negatively impacted gross margin and that we do not expect to repeat. On a full year basis, we delivered an improved gross margin of 36% compared to 35.5% in 2017. In Q1 of 2019, we expect our gross margin to be near 36%. The combination of improved gross margin and continued cost discipline drove operating margin improvement both Q4-over-Q4 and for the full year. This solid operating performance led to the record adjusted EBITDA I mentioned earlier.

With respect to taxes, 2018 had a lot of moving parts as we adjusted our estimates to fully reflect the impacts related to U.S. tax reform. In Q4, Quaker finalized its accounting for tax reform in accordance with the 1 year measurement period allowed by the SEC and took a related charge of approximately $8 million. When we look through the noise and exclude the impact of U.S. tax reform and certain nondeductible combination expenses, our full year effective tax rate of 22% is in the 22% to 24% range we estimated last quarter for our full year rate.

For our full year 2019, we expect an effective tax rate of 22% to 25%. However, please note that in 2019, we will be reapplying for a concessionary tax rate for one of our non-U. S. subsidiaries. This process occurs every 3 years and is usually not concluded until later in the year of application. As a result, we expect our Q1 through Q3 effective tax rates will be elevated and that our Q4 effective tax rate will be low to adjust to the full year expected rate of 22% to 25%. We currently expect our Q1 effective tax rate will be in the range of 24% to 27%. Please remember that these numbers exclude the impact of nondeductible combination expenses.

Overall, our solid performance drove record net operating cash flow of $79 million, up approximately 22% from the prior year. Our cash on hand of about $104 million increased 16% over prior year despite a significant paydown of debt of about $27 million and a 4% increase in dividends paid year-over-year. As you can see, Quaker continues to deliver strong and consistent cash flow and prudent management of the balance sheet.

Turning to the next few charts, which will give more history and context to certain key metrics. On Chart 6, you can see volume trends, and here you can see that 2018 is our ninth consecutive year of volume growth, which was up 3% in 2018. Chart 7 shows our gross margin trends. Here you can see the sequential decline I mentioned earlier, from Q3 to Q4, and the improvement for the full year to 36%. As Mike indicated, we currently expect our gross margin in Q1 will be near 36%. Chart 8 shows our continued climb in adjusted EBITDA, as we ended 2018 with a record $125.6 million, up 9% from 2017. Our adjusted EBITDA margin of 14.5% is also a new high. Chart 9 reflects our continued discipline in managing the balance sheet with our year-end net cash position improving significantly to $67.5 million compared with $23.1 million at year-end 2017.

In summary, Quaker continues to deliver solid and steady operating performance for its shareholders despite various market challenges.

Looking into 2019, we expect continued market volatility and low growth in our base markets of automotive and steel as Mike mentioned. However, we continue to expect market share gains and leveraging of our past acquisitions to drive above-market growth. In addition, we expect to close the combination with Houghton within the next few months, doubling the size of the company. As always, our primary focus is to continue to deliver the good performance our shareholders expect of Quaker.

Thank you all for joining us this morning and for your interest in Quaker. And now back to you, Mike.

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Michael F. Barry, Quaker Chemical Corporation - Chairman of the Board, CEO & President [4]

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Thank you, Mary. At this stage, we would like to address any questions from any of the participants on the conference call.

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Questions and Answers

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Operator [1]

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(Operator Instructions) Our first question comes from the line of Edward Marshall with Sidoti & Company.

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Edward James Marshall, Sidoti & Company, LLC - Senior Equity Research Analyst [2]

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So you made reference to several manufacturing costs that did slow the results in the quarter. I'm curious could you talk about maybe what occurred. Where it occurred? Have you resolved the issue?

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Mary Dean Hall, Quaker Chemical Corporation - CFO, VP & Treasurer [3]

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Sure. The elevated costs were largely due, as we said, to manufacturing and largely labor related, including third-party contractor costs, overtime, some severance is in those numbers, also some higher-than-expected maintenance. And the costs primarily affected North America and EMEA.

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Edward James Marshall, Sidoti & Company, LLC - Senior Equity Research Analyst [4]

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Got it. Okay. And then historically, we've been talking about getting back to that 37% gross margin range. And it seems like the conversation shifted. And I'm curious is that a temporary shift to 36%? Or has something structurally changed in the business? Or is it because we're trending below 36% in the fourth quarter? You just kind of used that as a reference point. I'm trying to get a sense as to where the longer tail in the gross margin is going to be.

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Michael F. Barry, Quaker Chemical Corporation - Chairman of the Board, CEO & President [5]

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Yes. I don't think anything's changed from a longer-term position, and we expect to be around 37%. It's more of a timing issue. I think we were just more concentrating on our comments here because we were below where we expected to be in the fourth quarter, where we expected to be in this low 36% range, and now we expect to kind of get back to that area in the first quarter. But longer-term, we will continue to strive to be in that 37%, but it really depends upon the exact timing of raw material changes and so forth.

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Edward James Marshall, Sidoti & Company, LLC - Senior Equity Research Analyst [6]

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Got it. And I wanted to get a sense also, finally, just seeing what you are seeing from some of the OEMs, the auto OEMs. And then maybe if you can even comment slightly on Houghton's automotive suppliers? I'm curious as they start to slow, and you said you saw it at the end of the fourth quarter -- my sense is there has been a lot of price pressure in that industry. You've seen it across a lot of the suppliers. OEMs are really pushing back. I'm curious how you think or what you think your success rate in price will be in that environment as we move into 2019.

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Michael F. Barry, Quaker Chemical Corporation - Chairman of the Board, CEO & President [7]

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I think a general statement for prices and margin maintenance is that we continue to expect to be able to -- as raw materials go up, we would expect to be able to capture that back. And historically we've been able to do that. So I guess, I don't really see any changes. I see most of the softness in the automotive market is really impacting our volumes more than the margin side of things.

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Operator [8]

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Our next question comes from the line of Mike Harrison with Seaport Global Securities.

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Michael Joseph Harrison, Seaport Global Securities LLC, Research Division - MD & Senior Chemicals Analyst [9]

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Just continuing on the gross margin discussion. I was wondering if you can comment in a little bit more detail on what you're seeing in raw material trends. And maybe give us a sense of when raw materials maybe could potentially become neutral. Or are you going to margin tailwinds at some point during 2019?

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Michael F. Barry, Quaker Chemical Corporation - Chairman of the Board, CEO & President [10]

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Yes. I mean, it's hard to exactly know what's going to happen in the longer term with raw materials, medium to longer term. But from a shorter-term perspective, they were again, relatively stable. There were certainly some increases that we saw in raw materials in the fourth quarter, more specific in the Asia-Pacific and EMEA area but, overall, relatively stable for us in the fourth quarter. As we get into the first quarter, early days, it's relatively stable as well, although crude has been since the beginning of the year trending up a little bit. And so we'll wait and see what happens there if anything happens. But so far, there hasn't been any major discontinuities in the raw material market.

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Michael Joseph Harrison, Seaport Global Securities LLC, Research Division - MD & Senior Chemicals Analyst [11]

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Okay. And then you mentioned the Asia-Pacific is an area where you saw some of this manufacturing costs overrun as well as some increases in raw materials, yet the margin performance in Asia-Pacific was very good, and the volume was very good despite some challenges. So can you just maybe go through kind of what you were seeing in that business to make it much stronger than people might have thought going into the quarter?

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Michael F. Barry, Quaker Chemical Corporation - Chairman of the Board, CEO & President [12]

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Sure, sure. First of all, on the manufacturing side of things, that was made in North America and EMEA continent. But you're right, Asia-Pacific was -- continues to be a really good story for us. And even despite China automotive being negatively impacted, we still saw a very good growth in Asia-Pacific. It was pretty broad-based growth, outside automotive, so we saw in our primary metals area, we saw good growth and whether it was China or in India, for example, we saw very good volume growth in our business. So overall, just pretty broad-based growth, continue to take share in the marketplace, pick up new pieces of business. It's just the things we've been doing pretty consistently and continue to offset what we saw in the automotive sector.

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Michael Joseph Harrison, Seaport Global Securities LLC, Research Division - MD & Senior Chemicals Analyst [13]

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And just maybe a couple of questions related to your auto exposure in Asia-Pacific. Are you relatively less exposed to Chinese automotive than you are to automotive in other countries? And also wondering are you better positioned with domestic players. Or are you better positioned with kind of the U.S. and European, the Western automakers that are producing in China?

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Michael F. Barry, Quaker Chemical Corporation - Chairman of the Board, CEO & President [14]

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We have exposure in both. We have both local automotive suppliers, and we also have the more international ones. As far as our exposure, I don't have that exact. But we do have a significant automotive business in China. It's large but obviously, our primary metals business is a good sign there too because steel production in China is greater than other places around the world

I don't have the exact split on that, but it's still a significant piece of what we do in China.

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Michael Joseph Harrison, Seaport Global Securities LLC, Research Division - MD & Senior Chemicals Analyst [15]

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All right. And then the last one from me. Do you feel that you gained share and outperformed the Chinese automotive market in Q4?

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Michael F. Barry, Quaker Chemical Corporation - Chairman of the Board, CEO & President [16]

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Yes.

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Operator [17]

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Our next question comes from the line of Laurence Alexander with Jefferies.

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Daniel Dalton Rizzo, Jefferies LLC, Research Division - Equity Analyst [18]

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It's Dan Rizzo on for Laurence. Just a clarification on the tax code you're referring to or the tax results for 2018. I think you indicated that it was 22%. But maybe I'm doing this wrong, but it seems to me with the exclusion of the onetime charges related to the change in U.S. tax show that it's actually probably a couple of hundred basis points lower. And I was wondering if I'm maybe looking at it wrong.

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Mary Dean Hall, Quaker Chemical Corporation - CFO, VP & Treasurer [19]

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The 22% that we called out is the more normalized rate, excludes both the Houghton combination expenses and U.S. tax reform.

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Daniel Dalton Rizzo, Jefferies LLC, Research Division - Equity Analyst [20]

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Okay, okay. I just wanted to make sure I was thinking about that correctly. So going forward with the 22% to 25% that you expect for 2019, I mean, would there be similar charges like that, that would be excluded from the adjusted results?

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Mary Dean Hall, Quaker Chemical Corporation - CFO, VP & Treasurer [21]

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The Houghton combination expenses.

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Daniel Dalton Rizzo, Jefferies LLC, Research Division - Equity Analyst [22]

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Okay. And then as we look at 2019 and what we're expecting in the regional trends, I mean, do you expect them to kind of stay where they are? Or are you expecting acceleration or deceleration anywhere? Is there anything that is weaker now that was surprising and should kind of rebound?

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Michael F. Barry, Quaker Chemical Corporation - Chairman of the Board, CEO & President [23]

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Well, all we can count on is in some ways is what our experts are projecting for global auto production as well as global steel production. Big picture of those 2 things is that we expect to see relatively flat maybe modest growth in automotive production. The major services, LMC and IHS, are still predicting maybe slight growth in global auto production, and that's kind of what we're tired to. Same with steel. We're talking probably in the order of maybe for steel 1%, maybe a little over 1%, for growth. So we're going to be in definitely lower-growth businesses. The trends I've seen mainly in the automotive sector -- of course, automotive was much -- was higher in the first half of '18 last year versus the second half. So the comparisons that we expect to -- that I have seen and people are projecting for auto production are negative comparisons in the first half of the year. But then as we enter the second half of the year, expecting to see that turn around in the second half

(technical difficulty)

be higher in production versus the second half of

(technical difficulty).

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Operator [24]

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Our next question comes from the line of Jonathan Tanwanteng with CJS Securities.

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Jonathan E. Tanwanteng, CJS Securities, Inc. - MD [25]

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Mike, the commentary regarding the Houghton close within a few months. Is there any change from when you last spoke about that? I think the last time, it was smacked in the middle of the government shutdown. Did that end sooner than anticipated? And did it pick back up where you thought it would?

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Michael F. Barry, Quaker Chemical Corporation - Chairman of the Board, CEO & President [26]

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We didn't know exactly where the government shutdown would end or anything. So yes I would say it did kind of progress longer than we had expected. So we didn't know how long that would last. And so it took the majority of January.

where we couldn't make really any progress because the government was shut down. Once they started up, it took a little while to get back into the discussions. But we picked up where we needed to be. We are having productive discussions with the FTC. So I feel we have made progress since the last announcement on January 8, and I still think we will get regulatory approval and close within the next few months.

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Jonathan E. Tanwanteng, CJS Securities, Inc. - MD [27]

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Okay, great. And then Mary, what are the total Houghton combination expenses are you planning for in 2019? And maybe if you could give it by quarter that would be helpful too.

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Mary Dean Hall, Quaker Chemical Corporation - CFO, VP & Treasurer [28]

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Really depends on when exactly we close, Jon. I think what we would say is from beginning of 2019 through close, we expect the expenses to total in the $25 million to $30 million area.

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Jonathan E. Tanwanteng, CJS Securities, Inc. - MD [29]

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Okay. Great. And then finally Mike, you had a press release about investment in India, a new facility. Is that a major investment? What are your expectations there? Is there any significant change to your capital investment strategy?

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Michael F. Barry, Quaker Chemical Corporation - Chairman of the Board, CEO & President [30]

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No, that's been building that we've probably touched on a little bit maybe over the past couple of years in our capital expenditure discussions. But it's a relatively lower-cost part of the world to build a facility. So we're very happy that we have an additional facility now. That's really on the west coast or western part of India, I should say, production facility that is more in the western part of India.

But like I said we're seeing good volume growth in India, and we think that will be a continued area that -- especially in the kind of markets that we're in, steel, automotive and so forth, that we'll continue to grow very well. And that's why I think it was over a year ago, December of '17, when we started the plan and are very happy now to have 100% of everything completed in the plant.

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Operator [31]

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Our next question comes from the line of Garo Norian with Palisade Capital Management.

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Garo Norian, Palisade Capital Management LLC - SVP of Research [32]

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Just wanted to circle back to the manufacturing costs and just wanted to make sure was there any impact to customers through the challenge that you had.

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Mary Dean Hall, Quaker Chemical Corporation - CFO, VP & Treasurer [33]

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No, no, Garo.

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Garo Norian, Palisade Capital Management LLC - SVP of Research [34]

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Okay. Great. And then looking through the segment information in the 10-K. It looked like there was a pretty good increase in the year-over-year nonoperating charges. And I was wondering what the primary drivers of that increase were.

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Mary Dean Hall, Quaker Chemical Corporation - CFO, VP & Treasurer [35]

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Most of that's compensation related, incentive compensation related.

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Operator [36]

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(Operator Instructions) Our next question comes from the line of Rosemarie Morbelli with G. Research.

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Rosemarie Jeanne Pitras-Morbelli, G. Research, LLC - Research Analyst [37]

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Regarding the automotive production, you are expecting your second half to be stronger than the first half just because of easier comparisons. Or what do you expect in terms of production, second half versus first half? Are you seeing the demand -- or the production rather increases -- increasing as from some data aspects?

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Michael F. Barry, Quaker Chemical Corporation - Chairman of the Board, CEO & President [38]

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I really don't have that information right in front of me. So I can't really tell you if it's going to be -- the exact production stuff. All I can point to is all we look at is the IHS and the LMC data, which is relatively consistent

(technical difficulty)

might just point you to that to get more information.

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Rosemarie Jeanne Pitras-Morbelli, G. Research, LLC - Research Analyst [39]

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Okay. And then since I am somewhat new to the story, what is behind your ability to gain share? Is it your technologies? Is it the service? Is it that you are competing with small companies I mean, excluding Houghton? Can you give me a better feel for what is happening there?

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Michael F. Barry, Quaker Chemical Corporation - Chairman of the Board, CEO & President [40]

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We've had a pretty long track record now of continually growing above our base markets. And as you look over the past 8, 9, 10 years now, we've been growing pretty consistently, this 2% to 4% over the markets. And I really always think that kind of gets back to our business model, heavy service oriented and we provide solutions to our customers. So when they have issues with a current supplier, and that supplier could be really any size, and they have problems, then we'll generally get an opportunity to help them solve their problems. And once we get that opportunity to help them and get a trial to solve with their solutions, we generally keep that piece of business. So I think it just goes back to our customer intimacy business model and our heavy service orientation and our ability to solve customer issues.

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Rosemarie Jeanne Pitras-Morbelli, G. Research, LLC - Research Analyst [41]

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Okay. And if you or Mary have the CapEx estimates for 2019?

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Mary Dean Hall, Quaker Chemical Corporation - CFO, VP & Treasurer [42]

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What -- generally what we say is our CapEx runs in that $10 million to $12 million a year range pretty consistently. And we would not expect anything different in this year.

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Operator [43]

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Ladies and gentlemen, this concludes our question-and-answer session. I'll turn the floor back to Mr. Barry for any final comments.

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Michael F. Barry, Quaker Chemical Corporation - Chairman of the Board, CEO & President [44]

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Okay. Given there are no other questions, we'll end our conference call now. And I want to thank all of you for your interest today. We are pleased with our results in the fourth quarter, and we continue to be confident in the future of Quaker Chemical. Our next conference call for the first quarter will be in late April or early May. And if you have any questions in the meantime, please feel free to contact Mary or myself. Thanks, again, for your interest in Quaker Chemical.

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Operator [45]

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Thank you. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.