Northern Technologies International Corporation (NASDAQ: NTIC) is a key player in the development of corrosion inhibiting products and bio-based polymer resin compounds. The company operates within the Zacks Chemical - Diversified industry. NTIC's product lines include the ZERUST® industrial and oil and gas segments, as well as Natur-Tec® products. Despite facing challenges in earnings, NTIC continues to show resilience in revenue generation.
On July 10, 2025, NTIC reported its earnings, revealing an earnings per share (EPS) of $0.02, which was below the estimated $0.04. This represents a significant decline from the $0.11 per share reported in the same quarter last year, resulting in a negative surprise of 50%. In the previous quarter, NTIC was expected to earn $0.06 per share but instead reported a loss of $0.03, leading to a surprise of -150%. Over the past four quarters, NTIC has exceeded consensus EPS estimates only once.
Despite the earnings miss, NTIC exceeded revenue expectations, generating approximately $21.5 million compared to the estimated $20.7 million. This marks a 4% increase in consolidated net sales. The ZERUST® industrial segment saw a 7.1% rise in net sales, totaling $14.4 million. However, the ZERUST® oil and gas segment experienced a 5.3% decline, bringing in $1.3 million. Sales for the Natur-Tec® products slightly decreased by 1.2% to $5.8 million.
NTIC China achieved a significant 27.4% increase in net sales, amounting to $4.5 million. The company's gross profit margin improved by 20 basis points to 38.4%. However, joint venture operating income fell by 12.9% to $2.3 million, and operating expenses rose by 7.6% to $9.7 million. Net income attributable to NTIC dropped to $122,000, compared to $977,000 in the previous year.
NTIC's financial ratios provide further insight into its performance. The company has a price-to-earnings (P/E) ratio of approximately 21.18, indicating the price investors are willing to pay for each dollar of earnings. The price-to-sales ratio stands at about 0.96, suggesting that the market values the company at nearly 96 cents for every dollar of sales. With a debt-to-equity ratio of about 0.12, NTIC maintains a relatively low level of debt compared to its equity, and a current ratio of approximately 2.18 suggests a strong ability to cover short-term liabilities with short-term assets.
