Valhi's Q4 loss was smaller than expected, revenue exceeded expectations, and the stock price rose.

2026-03-10 22:20:32

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Dallas - Valhi, Inc. (NYSE:VHI) reported a fourth-quarter loss of $1.86 per share, missing analysts’ expectations of a $0.87 profit per share, but revenue of $494.5 million exceeded expectations. The company’s chemicals division faced significant headwinds, with titanium dioxide prices declining and lower capacity utilization putting pressure on performance.

After the earnings release, the stock rose 2.6%.

The company’s net loss attributable to Valhi shareholders for the fourth quarter totaled $53.2 million, compared to a net profit of $22.8 million in the same period last year. This quarter includes an $8.5 million non-cash deferred tax expense related to the valuation allowance for deferred tax assets from the chemicals division’s German interest deduction restrictions. Revenue increased 3% year-over-year from $480.9 million in Q4 2024.

The chemicals division, which accounts for the majority of revenue, had net sales of $418.3 million, down 1% from $423.1 million last year. The average selling price of titanium dioxide fell 8% year-over-year, and the division’s actual capacity utilization in Q4 was only 55%, a significant drop from 97% last year. The division recorded an operating loss of $60.1 million, compared to an operating income of $32.6 million in the same period last year, mainly due to $54 million of unabsorbed fixed manufacturing costs and approximately $10.3 million in layoffs.

For the full year 2025, Valhi reported a net loss of $57.6 million, or $2.02 per share, compared to a net profit of $108 million, or $3.79 per share, in 2024. The chemicals division’s full-year actual capacity utilization was 77%, recognizing approximately $111 million of unabsorbed fixed manufacturing costs.

The parts products division showed improvement, with fourth-quarter revenue of $5.6 million, up from $4.9 million in the same period last year, driven mainly by increased marine parts sales and improved gross margins.

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