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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2025

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 1-5467

VALHI, INC.

(Exact name of Registrant as specified in its charter)

Delaware

87-0110150

(State or other jurisdiction of

incorporation or organization)

(IRS Employer

Identification No.)

5430 LBJ Freeway, Suite 1700

Dallas, Texas 75240-2620

(Address of principal executive office)

Registrant’s telephone number, including area code: (972) 233-1700

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock	VHI	NYSE

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer,” smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Act.


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒.

Number of shares of the registrant’s common stock, $.01 par value per share, outstanding on August 1, 2025: 28,302,293

Table of Contents‌

VALHI, INC. AND SUBSIDIARIES

INDEX

				Page number


Part I.	FINANCIAL INFORMATION

	Item 1.		Financial Statements

			Condensed Consolidated Balance Sheets – December 31, 2024 and June 30, 2025 (unaudited)	3

			Condensed Consolidated Statements of Income (unaudited) – Three and six months ended June 30, 2024 and 2025	5

			Condensed Consolidated Statements of Comprehensive Income (unaudited) – Three and six months ended June 30, 2024 and 2025	6

			Condensed Consolidated Statements of Stockholders’ Equity (unaudited) – Three and six months ended June 30, 2024 and 2025	7

			Condensed Consolidated Statements of Cash Flows (unaudited) – Six months ended June 30, 2024 and 2025	8

			Notes to Condensed Consolidated Financial Statements (unaudited)	9

	Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations	25

	Item 3.		Quantitative and Qualitative Disclosures About Market Risk	43

	Item 4.		Controls and Procedures	43

Part II.		OTHER INFORMATION

		Item 1.	Legal Proceedings	44

		Item 1A.	Risk Factors	44

		Item 6.	Exhibits	45

Items 2, 3, 4 and 5 of Part II are omitted because there is no information to report.

Table of Contents‌

VALHI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions)


ASSETS	December 31,		June 30,
	2024		2025
			(unaudited)
Current assets:
Cash and cash equivalents	$	348.3	$	188.5
Restricted cash equivalents		24.8		28.5
Marketable securities		1.9		2.4
Accounts and other receivables, net		327.8		379.2
Inventories, net		685.8		717.2
Prepaid expenses and other		65.1		51.6
Total current assets		1,453.7		1,367.4

Other assets:
Marketable securities		5.7		4.7
Goodwill		382.3		382.3
Deferred income taxes		53.8		58.6
Other assets		181.3		190.0
Total other assets		623.1		635.6

Property and equipment:
Land		74.7		79.2
Buildings		282.6		309.1
Equipment		1,312.0		1,444.4
Mining properties		76.0		89.7
Construction in progress		41.7		45.8
		1,787.0		1,968.2
Less accumulated depreciation and amortization		1,063.6		1,208.4
Net property and equipment		723.4		759.8
Total assets	$	2,800.2	$	2,762.8

Table of Contents‌

VALHI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED)

(In millions)


LIABILITIES AND STOCKHOLDERS' EQUITY	December 31,		June 30,
	2024		2025
			(unaudited)
Current liabilities:
Current maturities of long-term debt	$	79.0	$	88.7
Accounts payable and accrued liabilities		482.6		380.7
Accrued environmental remediation and related costs		59.7		4.3
Income taxes		22.5		9.4
Total current liabilities		643.8		483.1

Noncurrent liabilities:
Long-term debt		484.4		544.8
Accrued pension costs		117.6		127.2
Accrued environmental remediation and related costs		14.9		14.3
Deferred income taxes		57.7		63.7
Other liabilities		102.7		99.7
Total noncurrent liabilities		777.3		849.7

Equity:
Preferred stock		—		—
Common stock		.3		.3
Additional paid-in capital		669.9		670.3
Retained earnings		574.7		588.0
Accumulated other comprehensive loss		(159.2)		(137.5)
Treasury stock, at cost		(49.6)		(49.6)
Total Valhi stockholders' equity		1,036.1		1,071.5
Noncontrolling interest in subsidiaries		343.0		358.5
Total equity		1,379.1		1,430.0
Total liabilities and equity	$	2,800.2	$	2,762.8

Commitments and contingencies (Notes 13, 16 and 18)

See accompanying Notes to Condensed Consolidated Financial Statements.

Table of Contents‌

VALHI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In millions, except per share data)


	Three months ended				Six months ended
	June 30,				June 30,
	2024		2025		2024		2025

	(unaudited)
Revenues and other income:
Net sales	$	559.7	$	540.4	$	1,090.3	$	1,079.0
Other income, net		3.7		31.1		15.9		31.9
Total revenues and other income		563.4		571.5		1,106.2		1,110.9

Cost and expenses:
Cost of sales		438.4		462.3		882.7		878.4
Selling, general and administrative		74.9		79.2		143.5		157.7
Other components of net periodic pension and OPEB expense		.6		.7		1.2		1.5
Interest		11.9		13.8		23.2		27.0
Total cost and expenses		525.8		556.0		1,050.6		1,064.6

Income before income taxes		37.6		15.5		55.6		46.3
Income tax expense		7.9		8.0		12.3		16.0
Net income		29.7		7.5		43.3		30.3
Noncontrolling interest in net income of subsidiaries		9.8		6.6		15.6		12.5
Net income attributable to Valhi stockholders	$	19.9	$	.9	$	27.7	$	17.8

Amounts attributable to Valhi stockholders:
Basic and diluted net income per share	$	.70	$	.03	$	.97	$	.62

Basic and diluted weighted average shares outstanding		28.5		28.5		28.5		28.5

See accompanying Notes to Condensed Consolidated Financial Statements.

Table of Contents‌

VALHI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In millions)


	Three months ended				Six months ended
	June 30,				June 30,
	2024		2025		2024		2025

	(unaudited)
Net income	$	29.7	$	7.5	$	43.3	$	30.3
Other comprehensive income (loss), net of tax:
Currency translation		1.6		12.7		(16.7)		28.2
Defined benefit pension plans		.7		.6		1.4		1.2
Other		(.1)		—		(.2)		(.1)
Total other comprehensive income (loss), net		2.2		13.3		(15.5)		29.3
Comprehensive income		31.9		20.8		27.8		59.6
Comprehensive income attributable to noncontrolling interest		10.4		10.0		11.6		20.1
Comprehensive income attributable to Valhi stockholders	$	21.5	$	10.8	$	16.2	$	39.5

See accompanying Notes to Condensed Consolidated Financial Statements.

Table of Contents‌

VALHI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In millions)


	Three months ended June 30, 2024 and 2025 (unaudited)
							Accumulated
			Additional				other				Non-
	Common		paid-in		Retained		comprehensive		Treasury		controlling
	stock		capital		earnings		loss		stock		interest		Total
Balance at March 31, 2024	$	.3	$	669.5	$	481.3	$	(158.6)	$	(49.6)	$	321.6	$	1,264.5
Net income		—		—		19.9		—		—		9.8		29.7
Other comprehensive income, net		—		—		—		1.6		—		.6		2.2
Dividends paid to noncontrolling interest		—		—		—		—		—		(7.6)		(7.6)
Cash dividends - $.08 per share		—		—		(2.2)		—		—		—		(2.2)
Equity transactions with noncontrolling interest, net and other		—		.4		—		—		—		—		.4

Balance at June 30, 2024	$	.3	$	669.9	$	499.0	$	(157.0)	$	(49.6)	$	324.4	$	1,287.0

Balance at March 31, 2025	$	.3	$	669.9	$	589.3	$	(147.4)	$	(49.6)	$	350.8	$	1,413.3
Net income		—		—		.9		—		—		6.6		7.5
Other comprehensive income, net		—		—		—		9.9		—		3.4		13.3
Dividends paid to noncontrolling interest		—		—		—		—		—		(2.3)		(2.3)
Cash dividends - $.08 per share		—		—		(2.2)		—		—		—		(2.2)
Equity transactions with noncontrolling interest, net and other		—		.4		—		—		—		—		.4

Balance at June 30, 2025	$	.3	$	670.3	$	588.0	$	(137.5)	$	(49.6)	$	358.5	$	1,430.0


	Six months ended June 30, 2024 and 2025 (unaudited)
							Accumulated
			Additional				other				Non-
	Common		paid-in		Retained		comprehensive		Treasury		controlling
	stock		capital		earnings		loss		stock		interest		Total
Balance at December 31, 2023	$	.3	$	669.5	$	475.8	$	(145.5)	$	(49.6)	$	325.7	$	1,276.2
Net income		—		—		27.7		—		—		15.6		43.3
Other comprehensive loss, net		—		—		—		(11.5)		—		(4.0)		(15.5)
Dividends paid to noncontrolling interest		—		—		—		—		—		(12.9)		(12.9)
Cash dividends - $.16 per share		—		—		(4.5)		—		—		—		(4.5)
Equity transactions with noncontrolling interest, net and other		—		.4		—		—		—		—		.4

Balance at June 30, 2024	$	.3	$	669.9	$	499.0	$	(157.0)	$	(49.6)	$	324.4	$	1,287.0

Balance at December 31, 2024	$	.3	$	669.9	$	574.7	$	(159.2)	$	(49.6)	$	343.0	$	1,379.1
Net income		—		—		17.8		—		—		12.5		30.3
Other comprehensive income, net		—		—		—		21.7		—		7.6		29.3
Dividends paid to noncontrolling interest		—		—		—		—		—		(4.6)		(4.6)
Cash dividends - $.16 per share		—		—		(4.5)		—		—		—		(4.5)
Equity transactions with noncontrolling interest, net and other		—		.4		—		—		—		—		.4

Balance at June 30, 2025	$	.3	$	670.3	$	588.0	$	(137.5)	$	(49.6)	$	358.5	$	1,430.0

See accompanying Notes to Condensed Consolidated Financial Statements.

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VALHI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)


	Six months ended
	June 30,
	2024		2025

	(unaudited)
Cash flows from operating activities:
Net income	$	43.3	$	30.3
Depreciation and amortization		32.4		31.9
Benefit plan expense less than cash funding		(4.4)		(4.0)
Deferred income taxes		(4.0)		3.2
Distributions from TiO₂ manufacturing joint venture, net		9.8		—
Other, net		4.3		1.0
Change in assets and liabilities:
Accounts and other receivables, net		(79.3)		(18.2)
Inventories, net		103.4		15.8
Land held for development, net		1.5		(4.2)
Accounts payable and accrued liabilities		(130.1)		(100.8)
Accrued environmental remediation and related costs		—		(56.0)
Income taxes		(5.5)		(17.8)
Accounts with affiliates		(.3)		(29.4)
Other, net		13.6		14.0
Net cash used in operating activities		(15.3)		(134.2)

Cash flows from investing activities:
Capital expenditures		(8.8)		(25.4)
Purchases of marketable securities		(1.0)		—
Proceeds from disposal of marketable securities		43.8		.7
Net cash provided by (used in) investing activities		34.0		(24.7)

Cash flows from financing activities:
Kronos revolving credit facility:
Borrowings		—		306.3
Payments		—		(280.9)
Kronos term loan from Contran		53.7		—
Payments on long-term debt		(83.7)		(12.0)
Valhi cash dividends paid		(4.5)		(4.5)
Distributions to noncontrolling interest in subsidiaries		(12.9)		(9.6)
Deferred financing fees		(5.8)		—
Net cash used in financing activities		(53.2)		(.7)

Cash, cash equivalents and restricted cash and cash equivalents - net change from:
Operating, investing and financing activities		(34.5)		(159.6)
Effect of exchange rates on cash		(.2)		4.0
Balance at beginning of period		462.0		378.6
Balance at end of period	$	427.3	$	223.0

Supplemental disclosures:
Cash paid for:
Interest, net of amounts capitalized	$	11.4	$	24.8
Income taxes, net		35.7		50.7
Noncash investing activities:
Change in accruals for capital expenditures		.5		3.0

See accompanying Notes to Condensed Consolidated Financial Statements.

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VALHI, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2025

(unaudited)

Note 1 – Organization and basis of presentation:

Organization – We are majority owned by a wholly-owned subsidiary of Contran Corporation (“Contran”), which owns approximately 91% of our outstanding common stock at June 30, 2025. A majority of Contran’s outstanding voting stock is held directly by Lisa K. Simmons and by family stockholders (Thomas C. Connelly (the husband of Ms. Simmons’ late sister), a family-owned entity and various family trusts established for the benefit of Ms. Simmons, Mr. Connelly and their children) who are required to vote their shares of Contran voting stock in the same manner as Ms. Simmons. Such voting rights are personal to Ms. Simmons and last through April 22, 2030. The remainder of Contran’s outstanding voting stock is held by another trust (the “Family Trust”), which was established for the benefit of Ms. Simmons and her late sister and their children and for which a third-party financial institution serves as trustee. Consequently, at June 30, 2025, Ms. Simmons and the Family Trust may be deemed to control Contran and us.

Basis of Presentation – Consolidated in this Quarterly Report are the results of our wholly-owned and majority-owned subsidiaries, including NL Industries, Inc., Kronos Worldwide, Inc., CompX International Inc., Tremont LLC, Basic Management, Inc. (“BMI”) and The LandWell Company (“LandWell”). Kronos (NYSE: KRO), NL (NYSE: NL) and CompX (NYSE American: CIX) each file periodic reports with the Securities and Exchange Commission (“SEC”).

The unaudited Condensed Consolidated Financial Statements contained in this Quarterly Report have been prepared on the same basis as the audited Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2024 that we filed with the SEC on March 6, 2025 (the “2024 Annual Report”). In our opinion, we have made all necessary adjustments (which include only normal recurring adjustments), in order to state fairly, in all material respects, our consolidated financial position, results of operations and cash flows as of the dates and for the periods presented. We have condensed the Consolidated Balance Sheet at December 31, 2024 contained in this Quarterly Report as compared to our audited Consolidated Financial Statements at that date, and we have omitted certain information and footnote disclosures (including those related to the Consolidated Balance Sheet at December 31, 2024) normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Our results of operations for the interim periods ended June 30, 2025 may not be indicative of our operating results for the full year. The Condensed Consolidated Financial Statements contained in this Quarterly Report should be read in conjunction with our 2024 Consolidated Financial Statements contained in our 2024 Annual Report.

Effective July 16, 2024 (“Acquisition Date”), Kronos acquired the 50% joint venture interest in Louisiana Pigment Company, L.P. (“LPC”) previously held by Venator Investments, Ltd. (“Venator”). Prior to the acquisition, Kronos held a 50% joint venture interest in LPC and LPC was operated as a manufacturing joint venture between Kronos and Venator. Following the acquisition, LPC became a wholly-owned subsidiary of Kronos. For financial reporting purposes, the assets acquired and liabilities assumed of LPC have been included in our Condensed Consolidated Balance Sheets as of December 31, 2024 and June 30, 2025, and the results of operations and cash flows of LPC have been included in our Condensed Consolidated Statement of Income and Cash Flows beginning as of the Acquisition Date. See Note 18 to our Condensed Consolidated Financial Statements.

Unless otherwise indicated, references in this report to “we,” “us” or “our” refer to Valhi, Inc. and its subsidiaries (NYSE: VHI), taken as a whole.

Note 2 – Business segment information:


		% controlled at
Business segment	Entity	June 30, 2025
Chemicals	Kronos	81%
Component products	CompX	87%
Real estate management and development	BMI and LandWell	63% - 77%

Our control of Kronos includes approximately 50% we hold directly and approximately 31% held directly by NL. We own approximately 83% of NL. Our control of CompX is through NL. We own approximately 63% of BMI. Our control of LandWell includes the approximately 27% we hold directly and 50% held by BMI.

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Our chief operating decision maker (“CODM”) evaluates segment performance based on each segment’s operating income, which is defined as income before income taxes and interest expense, exclusive of certain non-recurring items (such as gains or losses on disposition of business units and other long-lived assets outside the ordinary course of business and certain legal settlements) and certain general corporate income and expense items (including securities transactions gains and losses and interest and dividend income), which are not attributable to the operations of the reportable operating segments. Interest income included in the calculation of segment operating income is not significant for the three and six months ended June 30, 2024 and 2025.


	Three months ended				Six months ended
	June 30,				June 30,
	2024		2025		2024		2025

	(In millions)
Net sales:
Chemicals	$	500.5	$	494.4	$	979.3	$	984.2
Component products		35.9		40.3		73.9		80.6
Real estate management and development		23.3		5.7		37.1		14.2
Total net sales	$	559.7	$	540.4	$	1,090.3	$	1,079.0
Cost of sales:
Chemicals	$	400.7	$	432.1	$	808.6	$	815.5
Component products		24.8		27.4		53.1		55.5
Real estate management and development		12.9		2.8		21.0		7.4
Total cost of sales	$	438.4	$	462.3	$	882.7	$	878.4
Gross margin:
Chemicals	$	99.8	$	62.3	$	170.7	$	168.7
Component products		11.1		12.9		20.8		25.1
Real estate management and development		10.4		2.9		16.1		6.8
Total gross margin	$	121.3	$	78.1	$	207.6	$	200.6
Operating income:
Chemicals	$	40.5	$	10.3	$	63.3	$	51.5
Component products		5.1		6.3		8.8		12.2
Real estate management and development		9.2		18.9		14.2		21.9
Total operating income		54.8		35.5		86.3		85.6
General corporate items:
Interest income and other		5.5		3.7		11.2		8.0
Other components of net periodic pension and OPEB expense		(.6)		(.7)		(1.2)		(1.5)
Changes in market value of Valhi common stock held by subsidiaries		.1		—		.6		(1.7)
General expenses, net		(10.3)		(9.2)		(18.1)		(17.1)
Interest expense		(11.9)		(13.8)		(23.2)		(27.0)
Income before income taxes	$	37.6	$	15.5	$	55.6	$	46.3


	Three months ended				Six months ended
	June 30,				June 30,
	2024		2025		2024		2025

	(In millions)
Depreciation and amortization:
Chemicals	$	19.0	$	15.6	$	30.5	$	30.0
Component products		.9		.9		1.8		1.9
Real estate management and development		—		—		.1		—
Total	$	19.9	$	16.5	$	32.4	$	31.9

Included in the Chemicals Segment’s operating income for the three and six month periods ended June 30, 2024 is a charge of approximately $2 million related to workforce reductions and approximately $10 million in non-cash charges primarily related to accelerated depreciation in connection with the closure of its sulfate process line in Canada in the second quarter of 2024. Infrastructure reimbursements and land related income is included in the determination of Real Estate Management and Development operating income. See Note 12. Segment results we report may differ from amounts separately reported by our various subsidiaries due to purchase accounting adjustments and related amortization or differences in the way we define operating income. Intersegment sales are not material. Our CODM is not regularly provided financial information related to the assets of the reportable segments, including capital

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expenditures, and he does not evaluate the reportable segments’ performance or allocate resources to them based on assets. Therefore, total assets by reportable segment are not included in our segment disclosures.

Note 3 – Accounts and other receivables, net:


	December 31,		June 30,
	2024		2025

	(In millions)
Trade accounts receivable:
Kronos	$	269.2	$	320.9
CompX		14.2		17.0
BMI/LandWell		.3		1.2
VAT and other receivables		45.9		37.7
Refundable income taxes		1.3		3.2
Receivables from affiliates:
Contran - income taxes		—		3.2
Contran - trade items		.2		.1
Other		.6		.2
Allowance for doubtful accounts		(3.9)		(4.3)
Total	$	327.8	$	379.2

Note 4 – Inventories, net:


	December 31,		June 30,
	2024		2025

	(In millions)
Raw materials:
Chemicals	$	176.9	$	142.8
Component products		5.6		5.8
Total raw materials		182.5		148.6
Work in process:
Chemicals		52.5		49.2
Component products		17.6		22.2
Total in-process products		70.1		71.4
Finished products:
Chemicals		308.3		359.8
Component products		5.1		4.9
Total finished products		313.4		364.7
Supplies (chemicals)		119.8		132.5
Total	$	685.8	$	717.2

Note 5 – Marketable securities:


			Cost or
			amortized		Unrealized
	Market value		cost		gain, net

	(In millions)
December 31, 2024:
Current assets	$	1.9	$	1.9	$	—

Noncurrent assets	$	5.7	$	5.7	$	—

June 30, 2025:
Current assets	$	2.4	$	2.4	$	—

Noncurrent assets	$	4.7	$	4.5	$	.2

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Our marketable securities consist of investments in marketable equity and debt securities. We classify all of our marketable securities as available-for-sale. Our marketable equity securities are carried at fair value using quoted market prices, primarily Level 1 inputs as defined by ASC Topic 820, Fair Value Measurements and Disclosures, with any unrealized gains or losses on the securities recognized in other income, net on our Condensed Consolidated Statements of Income. The fair value of our marketable debt securities is generally determined using Level 2 inputs because although these securities are traded in many cases, the market is not active and the quarter-end valuation is generally based on the last trade of the quarter, which may be several days prior to quarter end. We accumulate unrealized gains and losses on marketable debt securities as part of accumulated other comprehensive income (loss), net of related deferred income taxes. See Note 17.

Note 6 – Other noncurrent assets:


	December 31,		June 30,
	2024		2025

	(In millions)
Note receivables - OPA	$	91.6	$	102.8
Pension asset		19.8		21.9
Operating lease right-of-use assets		20.6		21.5
IBNR receivables		15.0		15.1
Restricted cash and cash equivalents		5.5		6.0
Land held for development		7.4		5.9
Other		21.4		16.8
Total	$	181.3	$	190.0

Note 7 – Long-term debt:


	December 31,		June 30,
	2024		2025

	(In millions)
Valhi:
Contran credit facility	$	44.6	$	33.1
Subsidiary debt:
Kronos:
Kronos International, Inc. 9.50% Senior Secured Notes due 2029		365.4		410.7
Kronos International, Inc. 3.75% Senior Secured Notes due 2025		78.3		87.9
Subordinated, Unsecured Term Loan from Contran		53.7		53.7
Revolving credit facility		10.0		37.0
LandWell:
Note payable to Western Alliance Business Trust		11.4		11.1
Total subsidiary debt		518.8		600.4
Total debt		563.4		633.5
Less current maturities		79.0		88.7
Total long-term debt	$	484.4	$	544.8

Valhi – Contran credit facility – During the first six months of 2025, we had no borrowings and repaid $11.5 million under this facility. The average interest rate on the credit facility for the six months ended June 30, 2025 was 8.50%. At June 30, 2025, the interest rate was 8.50%, and $116.9 million was available for borrowing under this facility.

Kronos – 9.50% Senior Secured Notes due 2029 – At June 30, 2025, the carrying value of the 9.50% Senior Secured Notes due 2029 (€351.174 million aggregate principal amount outstanding) is $410.7 million and is stated net of $5.2 million of unamortized premium and $6.2 million of unamortized debt issuance costs. In the first quarter of 2024 Kronos recognized a non-cash pre-tax interest charge of $1.5 million included in interest expense related to the write-off of deferred financing costs.

3.75% Senior Secured Notes due 2025 – At June 30, 2025, the carrying value of the 3.75% Senior Secured Notes due 2025 (€75 million aggregate principal amount outstanding) is $87.9 million.

Revolving credit facility (the “Global Revolver”) – Effective July 17, 2025, Kronos completed an amendment to its Global Revolver (the “Fourth Amendment”). Among other things, the Fourth Amendment increased the maximum borrowing amount from

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$300 million to $350 million and increased the Belgian and German sub-limits from €30 million and €60 million to €55 million and €85 million, respectively, allowing greater access to Euro denominated borrowings. The maturity date of the Global Revolver remains July 2029. After taking into consideration the effects of the Fourth Amendment, Kronos’ total availability for borrowing has increased by approximately $50 million. During the first six months of 2025, Kronos borrowed $314.1 million and repaid $287.1 million under this facility. The average interest rate on outstanding borrowings under this facility for the six months ended June 30, 2025 was 5.9%. At June 30, 2025, $37.0 million was outstanding under the Global Revolver and the average interest rate was 5.8%. As defined in the agreement and as calculated for the period ended June 30, 2025, the borrowing base exceeded $350 million. At June 30, 2025, Kronos had total availability for borrowing of approximately $300 million less any amounts outstanding under this facility.

Other – We are in compliance with all of our debt covenants at June 30, 2025.

Note 8 – Accounts payable and accrued liabilities:


	December 31,		June 30,
	2024		2025

	(In millions)
Accounts payable:
Kronos	$	232.4	$	187.0
CompX		3.7		4.1
BMI/LandWell		8.0		3.1
Distributions payable to noncontrolling interest		5.9		1.0
Total		250.0		195.2
Payables to affiliates:
Contran - income taxes		16.9		—
Contran - other		.2		1.3
Employee benefits		38.7		35.1
Deferred income		28.2		27.4
Accrued development costs		30.0		22.4
Accrued sales discounts and rebates		27.6		17.0
Accrued litigation settlement		16.4		16.6
Interest		11.4		12.5
Operating lease liabilities		3.5		4.2
Other		59.7		49.0
Total	$	482.6	$	380.7

The accrued litigation settlement is discussed in Note 16.

Note 9 – Other noncurrent liabilities:


	December 31,		June 30,
	2024		2025

	(In millions)
Accrued development costs	$	26.8	$	24.7
Operating lease liabilities		17.1		17.1
Insurance claims and expenses		16.6		16.6
Asset retirement obligations		14.3		16.2
Deferred income		11.8		8.0
Other postretirement benefits		6.7		7.0
Employee benefits		4.5		5.0
Earn-out liability		4.3		4.6
Other		.6		.5
Total	$	102.7	$	99.7

See Notes 17 and 18 for additional details related to the acquisition earn-out liability.

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Note 10 – Revenue – disaggregation of sales:

The following table disaggregates the net sales of our Chemicals Segment by place of manufacture (point of origin) and to the location of the customer (point of destination), which are the categories that depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors.


	Three months ended				Six months ended
	June 30,				June 30,
	2024		2025		2024		2025

	(In millions)
Net sales - point of origin:
United States	$	279.7	$	275.7	$	520.6	$	598.1
Germany		216.2		214.5		428.4		431.3
Canada		97.6		55.7		186.9		166.5
Norway		77.7		72.8		148.7		143.3
Belgium		61.0		65.6		130.6		131.3
Eliminations		(231.7)		(189.9)		(435.9)		(486.3)
Total	$	500.5	$	494.4	$	979.3	$	984.2

Net sales - point of destination:
Europe	$	222.6	$	226.8	$	437.5	$	455.3
North America		182.5		188.2		348.5		378.4
Other		95.4		79.4		193.3		150.5
Total	$	500.5	$	494.4	$	979.3	$	984.2

The following table disaggregates the net sales of our Component Products Segment by major product line.


	Three months ended				Six months ended
	June 30,				June 30,
	2024		2025		2024		2025

	(In millions)
Net sales:
Security products	$	28.2	$	30.7	$	58.1	$	60.9
Marine components		7.7		9.6		15.8		19.7
Total	$	35.9	$	40.3	$	73.9	$	80.6

Substantially all of the Real Estate Management and Development Segment’s sales are related to land sales in the second quarter and the first six months of 2024 and 2025.

Note 11 – Defined benefit pension plans:

NL administers a U.S. pension plan which has been closed to new participants since 1996. In accordance with applicable U.S. pension regulations, effective June 30, 2025 NL began the process of terminating the pension plan, which includes the purchase of annuity contracts from a third-party insurance company for the purpose of distributing benefits to plan participants. The termination process involves several steps and is expected to take between six and twelve months to complete. Following the purchase of the annuity contracts for plan participants we will remove pension plan assets and liabilities from our Condensed Consolidated Financial Statements and a plan settlement gain or loss (which we are currently unable to estimate) will be included in our net periodic pension cost. The plan termination is expected to be completed with existing plan funds. At December 31, 2024 the U.S. pension plan had a benefit obligation of $65.2 million, plan assets of $75.7 million and a pension plan asset of $10.7 million.

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The components of our net periodic defined benefit pension cost are presented in the table below.


	Three months ended				Six months ended
	June 30,				June 30,
	2024		2025		2024		2025

	(In millions)
Service cost	$	1.6	$	1.5	$	3.3	$	2.9
Interest cost		5.2		5.8		10.6		11.3
Expected return on plan assets		(5.6)		(5.9)		(11.2)		(11.4)
Recognized net actuarial losses		1.0		.9		1.9		1.6
Total	$	2.2	$	2.3	$	4.6	$	4.4

We expect to contribute the equivalent of approximately $16 million to all of our defined benefit pension plans during 2025.

Note 12 – Other income, net:


	Six months ended
	June 30,
	2024		2025

	(In millions)
Interest income and other:
Interest and dividends	$	11.0	$	7.8
Securities transactions, net		.2		.2
Total		11.2		8.0
Infrastructure reimbursement		—		17.5
Currency transactions, net		2.0		5.0
Other, net		2.7		1.4
Total	$	15.9	$	31.9

Infrastructure reimbursement – As disclosed in Note 7 to our 2024 Annual Report, under an Owner Participation Agreement (“OPA”) entered into by LandWell with the Redevelopment Agency of the City of Henderson, Nevada, as LandWell develops certain real property for commercial and residential purposes in its master planned community in Henderson, Nevada, the cost of certain public infrastructure may be reimbursed to LandWell through tax increment. LandWell received $17.2 million during the second quarter of 2025 which was recognized as other income and is evidenced by a promissory note issued to LandWell by the City of Henderson.

LandWell has agreements with certain utility providers servicing the Cadence master planned community under which certain costs incurred for the development of power infrastructure may be reimbursed to LandWell. LandWell received $.3 million in reimbursement during the second quarter of 2025 for past costs incurred.

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Note 13 – Income taxes:


	Three months ended				Six months ended
	June 30,				June 30,
	2024		2025		2024		2025

	(In millions)
Expected tax expense at U.S. federal statutory income tax rate of 21%	$	7.9	$	3.2	$	11.7	$	9.7
Non-U.S. tax rates		(.1)		(.3)		(.1)		.2
Incremental net tax benefit on earnings and losses of U.S. and non-U.S. tax group companies and other affiliates		(3.5)		(2.1)		(4.3)		(2.5)
Global intangible low-taxed income, net		1.1		1.9		1.4		2.5
Valuation allowance, net		1.7		5.3		2.5		5.5
Nondeductible expenses		.4		.8		.6		1.3
U.S. state income taxes and other, net		.4		(.8)		.5		(.7)
Income tax expense	$	7.9	$	8.0	$	12.3	$	16.0

Comprehensive provision for income taxes allocable to:
Net income	$	7.9	$	8.0	$	12.3	$	16.0
Other comprehensive income (loss):
Currency translation		.2		1.7		(2.1)		3.6
Pension plans		.3		.2		.6		.4
Other		(.1)		—		(.2)		—
Total	$	8.3	$	9.9	$	10.6	$	20.0

The amount shown in the preceding table of our income tax rate reconciliation for non-U.S. tax rates represents the result determined by multiplying the pre-tax earnings or losses of each of our non-U.S. subsidiaries by the difference between the applicable statutory income tax rate for each non-U.S. jurisdiction and the U.S. federal statutory tax rate. The amount shown on such table for incremental net tax benefit on earnings and losses on non-U.S. and non-tax group companies includes, as applicable, (i) deferred income taxes (or deferred income tax benefits) associated with the current year earnings (losses) of all our Chemicals Segment’s non-U.S. subsidiaries, (ii) current U.S. income taxes (or current income tax benefit) including U.S. personal holding company tax, as applicable, attributable to current-year income (losses) of one of our Chemicals Segment’s non-U.S. subsidiaries, which subsidiary is treated as a dual resident for U.S. income tax purposes, to the extent the current year income (losses) of such subsidiary is subject to U.S. income tax under the U.S. dual-resident provisions of the Internal Revenue Code, (iii) deferred income taxes associated with our direct investment in Kronos and (iv) current and deferred income taxes associated with distributions and earnings from our investments in LandWell and BMI.

Tax authorities are examining certain of our U.S. and non-U.S. income tax returns and may propose tax deficiencies, including penalties and interest. We believe we have adequate accruals for additional taxes and related interest expense which could ultimately result from tax examinations. We believe the ultimate disposition of tax examinations should not have a material adverse effect on our consolidated financial position, results of operations or liquidity. Excluding any potential adjustments resulting from on-going examinations by tax authorities, we currently estimate that our unrecognized tax benefits will not change materially during the next twelve months.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law in the United States. The OBBBA, among other provisions, provides for bonus depreciation of qualified property, permanently modifies the interest expense deduction to use an adjusted taxable income based on a calculation similar to EBITDA and other computational changes, and makes changes to the international tax framework. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. We are in the process of evaluating the impact of the provisions of the OBBBA on our consolidated financial statements.

On July 18, 2025, Germany enacted legislation which includes, among other provisions, an additional depreciation allowance for certain fixed assets, improvements to the research and development tax allowance and, starting in 2028, a reduction of the 15% corporate tax rate by one percentage point in each of five years until the tax rate reaches 10% in 2032. We have significant German corporate net operating loss carryforwards and we expect to record deferred income tax expense of between $20 million and $23 million in the third quarter of 2025 to reduce our net deferred tax assets as a result of the reduction of the German corporate tax rate.

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Note 14 – Noncontrolling interest in subsidiaries:


	December 31,		June 30,
	2024		2025

	(In millions)
Noncontrolling interest in net assets:
Kronos Worldwide	$	210.3	$	215.9
NL Industries		81.5		81.7
CompX International		19.0		19.4
BMI		18.7		22.0
LandWell		13.5		19.5
Total	$	343.0	$	358.5


	Six months ended June 30,
	2024		2025

	(In millions)
Noncontrolling interest in net income of subsidiaries:
Kronos Worldwide	$	5.1	$	1.6
NL Industries		2.5		.2
CompX International		1.1		1.4
BMI		2.7		3.3
LandWell		4.2		6.0
Total	$	15.6	$	12.5

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Note 15 – Stockholders’ equity:

Accumulated other comprehensive loss – Changes in accumulated other comprehensive income (loss) attributable to Valhi stockholders are presented in the table below.


	Three months ended				Six months ended
	June 30,				June 30,
	2024		2025		2024		2025

	(In millions)
Accumulated other comprehensive income (loss) (net of tax and noncontrolling interest):
Marketable securities:
Balance at beginning and end of period	$	1.7	$	1.7	$	1.7	$	1.7

Currency translation:
Balance at beginning of period	$	(102.4)	$	(100.3)	$	(88.8)	$	(111.7)
Other comprehensive income (loss) arising during the period		1.2		9.5		(12.4)		20.9
Balance at end of period	$	(101.2)	$	(90.8)	$	(101.2)	$	(90.8)

Defined benefit pension plans:
Balance at beginning of period	$	(58.3)	$	(48.9)	$	(58.8)	$	(49.4)
Other comprehensive income:
Amortization of prior service cost and net losses included in net periodic pension cost		.5		.4		1.0		.9
Balance at end of period	$	(57.8)	$	(48.5)	$	(57.8)	$	(48.5)

OPEB plans:
Balance at beginning of period	$	.4	$	.1	$	.4	$	.2
Other comprehensive income:
Amortization of prior service credit and net losses included in net periodic OPEB cost		(.1)		—		(.1)		(.1)
Balance at end of period	$	.3	$	.1	$	.3	$	.1

Total accumulated other comprehensive loss:
Balance at beginning of period	$	(158.6)	$	(147.4)	$	(145.5)	$	(159.2)
Other comprehensive income (loss)		1.6		9.9		(11.5)		21.7
Balance at end of period	$	(157.0)	$	(137.5)	$	(157.0)	$	(137.5)

Note 16 – Commitments and contingencies:

Lead pigment litigation – NL

NL’s former operations included the manufacture of lead pigments for use in paint and lead-based paint. NL, other former manufacturers of lead pigments for use in paint and lead-based paint (together, the “former pigment manufacturers”), and the Lead Industries Association (“LIA”), which discontinued business operations in 2002, have previously been named as defendants in various legal proceedings seeking damages for personal injury, property damage and governmental expenditures allegedly caused by the use of lead-based paints. Certain of these actions were filed by or on behalf of states, counties, cities or their public housing authorities and school districts, and certain others were asserted as class actions. NL currently has no pending lead paint class action cases or pending lead paint cases brought by housing authorities, school districts or other government entities.

In the terms of the County of Santa Clara v. Atlantic Richfield Company, et al. (Superior Court of the State of California, County of Santa Clara, Case No. 1-00-CV-788657) global settlement agreement, NL has one installment payment of $16.7 million remaining which is due in September 2025. The remaining installment will be made with funds already on deposit at the court, which are included in current restricted cash on our Condensed Consolidated Balance Sheets, that are committed to the settlement, including all accrued interest at the date of payment. The amounts on deposit with the court are in excess of the final payment and such excess will be returned to NL. See Note 18 to our 2024 Annual Report.

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New cases may continue to be filed against NL. We do not know if we will incur liability in the future in respect to any of the pending or possible litigation in view of the inherent uncertainties involved in court and jury rulings. In the future, if new information regarding such matters becomes available to us (such as a final, non-appealable adverse verdict against NL or otherwise ultimately being found liable with respect to such matters), at that time we would consider such information in evaluating any remaining cases then-pending against NL as to whether it might then have become probable we have incurred liability with respect to these matters, and whether such liability, if any, could have become reasonably estimable. The resolution of any of these cases could result in the recognition of a loss contingency accrual that could have a material adverse impact on our net income for the interim or annual period during which such liability is recognized and a material adverse impact on our consolidated financial condition and liquidity.

Environmental matters and litigation

Our operations are governed by various environmental laws and regulations. Certain of our businesses are and have been engaged in the handling, manufacture or use of substances or compounds that may be considered toxic or hazardous within the meaning of applicable environmental laws and regulations. As with other companies engaged in similar businesses, certain of our past and current operations and products have the potential to cause environmental or other damage. Our businesses have implemented and continue to implement various policies and programs in an effort to minimize these risks. Our policy is to maintain compliance with applicable environmental laws and regulations at all of our plants and to strive to improve environmental performance and overall sustainability. Periodically we produce our Kronos Environmental Social Governance Report, which highlights Kronos’ focus on sustainability of its manufacturing operations, as well as its environmental, social and governance strategy. From time to time, our businesses may be subject to environmental regulatory enforcement under U.S. and non-U.S. statutes, the resolution of which typically involves the establishment or enhancement of compliance programs. It is possible that future developments, such as stricter requirements of environmental laws and enforcement policies, could adversely affect our production, handling, use, storage, transportation, sale or disposal of such substances. We believe all of our facilities are in substantial compliance with applicable environmental laws.

Certain properties and facilities used in our former operations (primarily NL’s former operations), including divested primary and secondary lead smelters and former mining locations, are the subject of civil litigation, administrative proceedings or investigations arising under federal and state environmental laws and common law. Additionally, in connection with past operating practices, we are currently involved as a defendant, potentially responsible party (“PRP”) or both, pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, as amended by the Superfund Amendments and Reauthorization Act (“CERCLA”), and similar state laws in various governmental and private actions associated with waste disposal sites, mining locations, and facilities that we or our predecessors, and NL or its predecessors, our subsidiaries or their predecessors currently or previously owned, operated or used, certain of which are on the United States Environmental Protection Agency’s (“EPA”) Superfund National Priorities List or similar state lists. These proceedings seek cleanup costs, damages for personal injury or property damage and/or damages for injury to natural resources. Certain of these proceedings involve claims for substantial amounts. Although we may be jointly and severally liable for these costs, in most cases we are only one of a number of PRPs who may also be jointly and severally liable, and among whom costs may be shared or allocated. In addition, we are occasionally named as a party in a number of personal injury lawsuits filed in various jurisdictions alleging claims related to environmental conditions alleged to have resulted from our operations.

Obligations associated with environmental remediation and related matters are difficult to assess and estimate for numerous reasons including the:

●

complexity and differing interpretations of governmental regulations,

●

number of PRPs and their ability or willingness to fund such allocation of costs,

●

financial capabilities of the PRPs and the allocation of costs among them,

●

solvency of other PRPs,

●

multiplicity of possible solutions,

●

number of years of investigatory, remedial and monitoring activity required,

●

uncertainty over the extent, if any, to which our former operations might have contributed to the conditions allegedly giving rise to such personal injury, property damage, natural resource and related claims, and

●

number of years between former

VALHI INC /DE/ 10-Q