PQ Group Holdings Inc. (NYSE: PQG) reported Q2 EPS of $0.22, $0.03 better than the analyst estimate of $0.19. Revenue for the quarter came in at $359.5 million versus the consensus estimate of $358.71 million.

• Sales of $359.5 million and Net income of $15.9 million with diluted EPS of $0.12; Adjusted net income of $30.0 million with Adjusted diluted EPS of $0.22;
• Adjusted EBITDA of $113.0 million; Adjusted EBITDA margin of 28.2% in line with prior year on effective cost management actions;
• Monetization of non-strategic assets leads to ~$27 million in cash proceeds ($18 million of which was received on July 1, 2020)
• Secured notes refinancing significantly lowers interest costs and extends maturities

“PQ’s favorable second quarter performance demonstrates the resilience of our portfolio and the impressive execution of the team, which quickly adjusted our cost structure to hold the line on margins despite the stiff macroeconomic headwinds,” said Belgacem Chariag, PQ Chairman, President and Chief Executive Officer. “Based on current visibility into demand trends for the balance of the year, we are pleased to reinitiate 2020 financial guidance and raise our expectations for our annual Adjusted free cash flow to $145 to $155 million, with Adjusted EBITDA margin now expected to be in line with 2019 levels.”

GUIDANCE:

PQ Group Holdings Inc. sees FY2020 EPS of $0.67-$0.86, versus the consensus of $0.74. PQ Group Holdings Inc. sees FY2020 revenue of $1.43-1.46 million, versus the consensus of $1.45 million.

“PQ is executing well operationally and commercially, delivering good financial results in a challenging environment and continuing to optimize the portfolio,” said Chariag. “Looking ahead, we see the vast majority of PQ’s end uses as either favorable or improving, even as we are mindful of the cautious global economic environment that surrounds us all. We are appropriately managing costs and exercising capital discipline, while we build capabilities and invest for targeted growth.”

The Company provided full-year 2020 guidance which includes:

• Sales of $1,430 to $1,460 million(1)
• Adjusted EBITDA of $410 to $425 million
• Adjusted EBITDA margin of ~27% in line with 2019 margins
• Adjusted diluted EPS of $0.67 to $0.86
• Adjusted free cash flow in the range of $145 to $155 million, excluding $18 million in cash proceeds from product line sale; increased from $130 to $150 million

For earnings history and earnings-related data on PQ Group Holdings Inc. (PQG) click here.