Contradictions Unveiled: Northern Technologies' Q2 2025 Earnings Call Highlights Revenue Hopes and Challenges in Oil & Gas

These are the key contradictions discussed in Northern Technologies International Corporation's latest 2025 Q2 earnings call, specifically including: Zerust Oil & Gas revenue expectations and new salespeople impact, EXCOR Germany performance, and growth expectations in Oil and Gas:



Financial Performance and Challenges:
- NTIC's total consolidated net sales for the second quarter decreased by 8.5% to $19.1 million year-over-year.
- The decline was due to decreases in Zerust Oil and Gas, Natur-Tec, and Zerust Industrial segments, as well as the impact of recent changes in U.S. trade and economic policies.

Zerust Oil and Gas Segment Performance:
- Zerust Oil and Gas sales were $1.5 million in the second quarter, down from $2.2 million in the same period last year.
- Despite the decline, trailing 12-month sales increased by 7.2% to $8.6 million, supported by a growing sales pipeline and strategic investments in sales infrastructure.

Natur-Tec Business Dynamics:
- Natur-Tec sales decreased by 11.8% to $5 million in the second quarter year-over-year.
- The decline was attributed to order timing, seasonal variation, and potential impacts from recent tariffs, but the company remains optimistic about long-term market opportunities.

International Operations and Joint Ventures:
- NTIC China's net sales increased by 8.1% to $3.7 million in the second quarter.
- The company is committed to enhancing operations in China and believes it will become a significant market in the future, despite regional economic pressures and trade uncertainties.

Capital Allocation and Strategic Priorities:
- NTIC's Board of Directors temporarily adjusted the quarterly dividend to $0.01 per share to manage cash position and reduce debt.
- The company is focused on strategic growth priorities, including oil and gas and compostable plastics businesses, to drive sustainable growth and long-term shareholder value.