A maker of treated wood products, wood-preserving chemicals, and carbon compounds, Koppers is the largest North American supplier of railroad crossties, with brands like MicroPro-treated lumber. It traces its roots to German engineer Heinrich Koppers, who in 1912 brought his "chemical-recovery" coke oven to America, built to capture coal tar byproducts rather than release them into the air. That same coal tar is still distilled into creosote for the ties the company makes today.
CMC adjusted EBITDA falls 55% to $7.6M, reversing three quarters of recovery, as higher costs erase prior gains.
The recovery in Carbon Materials and Chemicals unraveled this quarter. rose 3% to $520.1 million and Performance Chemicals climbed 31% on rebounding volumes, but consolidated adjusted EBITDA fell 8% to $71.0 million as CMC adjusted EBITDA dropped 55% to $7.6 million on higher raw material and operating costs. The company is now executing a multi-year transformation plan to shed lower-margin businesses, leaving its near-term earnings dependent on whether the PC volume recovery can outrun the CMC cost drag.
Key takeaways
Carbon Materials and Chemicals fell 54.8% to $7.6 million, driven by $9.2 million in higher raw material and operating costs that more than offset savings from the phthalic anhydride plant shutdown, reversing three consecutive quarters of growth.
Performance Chemicals rose 31.4% to $37.7 million as Americas volumes increased 11% and lower raw material costs, including copper-hedging benefits, lifted margins — a sharp reversal from the 17% volume decline reported for full-year 2025.
Section summaries
Management's Discussion and Analysis
Q2 2026 sales rose 3% to $520M driven by PC and utility pole volumes, but adjusted EBITDA fell 8% to $71M on RUPS and CMC margin pressure.
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Consolidated increased 3.0% to $520.1M, led by an 11.5% rise in Performance Chemicals and a 2.3% increase in Carbon Materials and Chemicals, partly offset by a 1.8% decline in Railroad and Utility Products and Services.
Consolidated contracted 1.7 percentage points to 21.0%, as the mix shift toward lower-margin PC and the CMC profit drop weighed on profitability.
Railroad and Utility Products and Services declined as lower pricing and unfavorable customer mix compressed margins, despite a 2.3% increase in Carbon Materials and Chemicals sales.
for the first half of 2026 improved to $96.3 million from $27.8 million a year ago, aided by lower usage and the absence of prior-year pension settlement funding.
The company disclosed a multi-year transformation plan targeting higher margins and by 2028, including plant closures, network optimization, and scaling back lower-margin, capital-intensive businesses.
What changed
The CMC recovery flagged in Q3 2024 and sustained through Q3 2025 — three consecutive quarters of growth — ended abruptly in Q1 2026 and deepened in Q2, with adjusted EBITDA falling 91% and then 55% as higher costs overwhelmed the savings from exiting phthalic anhydride.
The PC volume decline that defined 2024–2025 — a 17% drop for full-year 2025 attributed to U.S. market share shifts — reversed in Q1 2026 with a 15% volume increase and continued in Q2 with an 11% Americas volume gain, suggesting the share losses flagged in prior quarters may have been arrested.
The $4 million to $8 million estimated pre-tax tariff impact disclosed in Q2 2025 and carried through FY 2025 was not updated in this filing; the company stated there were no material changes to market risk disclosures, leaving the estimate unchanged.
The company recorded no new material or restructuring charges in Q2 2026, a change from the $51.9 million in such charges reported for full-year 2025 and the $17.6 million recorded in Q2 2025, signaling that the heavy restructuring cycle tied to the phthalic anhydride exit and workforce reductions may be complete.
What to watch
Whether the CMC 's $7.6 million result stabilizes in Q3 or whether the higher cost structure that drove the 55% decline persists, extending the segment's renewed slide.
Whether the PC sustains its 11% Americas volume growth into Q3, confirming that the U.S. market share losses of 2024–2025 have been fully reversed, or whether the gain reflects a temporary restocking or customer win.
Whether the multi-year transformation plan — including plant closures and scaling back lower-margin businesses — results in additional or restructuring charges in the second half of 2026, or whether the costs have been fully absorbed.
Whether the sustained COMEX premium over LME copper prices flagged in prior risk factors begins to erode PC margins, now that the is growing volumes again and the copper-hedging program is providing a material benefit.
decreased 7.9% to $71.0M as RUPS margin contracted on lower pricing and unfavorable mix, and CMC margin fell sharply due to higher raw material and operating costs.
Performance Chemicals grew 31.4% to $37.7M, driven by an 11% volume increase in the Americas and lower raw material costs, including benefits from the copper-hedging program.
CMC dropped 54.8% to $7.6M, with higher expenses of $9.2M partly offset by savings from discontinuing phthalic anhydride production at the Stickney, Illinois facility.
improved to $96.3M for the first half of 2026 from $27.8M a year ago, aided by lower usage and the absence of prior-year pension settlement funding.
The company is executing a multi-year transformation plan targeting higher margins and by 2028, including plant closures, network optimization, and scaling back lower-margin, capital-intensive businesses.
Quantitative and Qualitative Disclosures About Market Risk
There are no material changes to the disclosure on this matter made in Item 7A of Part II of our Annual Report on Form 10-K for the year ended December 31, 2025.
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There are no material changes to the disclosure on this matter made in Item 7A of Part II of our Annual Report on Form 10-K for the year ended December 31, 2025.
The information set forth in Note 12 to the Condensed Consolidated Financial Statements of Koppers Holdings Inc. included in Item 1 of Part I of this report is incorporated herein by reference. 28
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The information set forth in Note 12 to the Condensed Consolidated Financial Statements of Koppers Holdings Inc. included in Item 1 of Part I of this report is incorporated herein by reference.
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There have been no material changes to the Risk Factors previously disclosed in Item 1A of Part I of our Annual Report on Form 10-K for the year ended December 31, 2025.
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There have been no material changes to the Risk Factors previously disclosed in Item 1A of Part I of our Annual Report on Form 10-K for the year ended December 31, 2025.