8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

February 27, 2014

Date of Report (Date of earliest event reported)

QUAKER CHEMICAL CORPORATION

(Exact name of Registrant as specified in its charter)

Commission File Number 001-12019

PENNSYLVANIA	No. 23-0993790
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

One Quaker Park

901 E. Hector Street

Conshohocken, Pennsylvania 19428

(Address of principal executive offices)

(Zip Code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 INFORMATION TO BE INCLUDED IN THE REPORT

Item 2.02. Results of Operations and Financial Condition.

On February 27, 2014, Quaker Chemical Corporation announced its results of operations for the fourth quarter and full year ended December 31, 2013 in a press release, the text of which is included as Exhibit 99.1 hereto. Supplemental information related to the same period is also included as Exhibit 99.2 hereto.

Item 9.01. Financial Statements and Exhibits.

The following exhibits are included as part of this report:

Exhibit No.
99.1	Press Release of Quaker Chemical Corporation dated February 27, 2014.
99.2	Supplemental Information related to fourth quarter and full year ended December 31, 2013.

SIGNATURE 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. 

	QUAKER CHEMICAL CORPORATION Registrant
Date:  February 27, 2014	By:	/s/ Margaret m. loebl
		Margaret M. Loebl
		Vice President, Chief Financial Officer and Treasurer

EX-99.1

  NEWS   Contact: Margaret M. Loebl Vice President, Chief Financial Officer and Treasurer loeblm@quakerchem.com T. 610.832.4160 For Release: Immediate

QUAKER CHEMICAL ANNOUNCES FOURTH QUARTER AND FULL YEAR 2013

RESULTS

· Quarterly net sales growth of 7% despite a challenging economic environment

· Significant earnings per share growth compared to fourth quarter 2012

· Strong quarterly performance drives year-to-date operating cash flow to $73.8 million

February 27, 2014

CONSHOHOCKEN, PA – Quaker Chemical Corporation (NYSE: KWR) today announced net sales of $184.3 million for the fourth quarter of 2013, up approximately 7% compared to the fourth quarter of 2012 net sales of $172.9 million. Earnings per diluted share for the fourth quarter of 2013 were $1.07 compared to $0.99 for the fourth quarter of 2012, with non-GAAP earnings per diluted share increasing approximately 13% to $0.98 for the fourth quarter of 2013 from $0.87 for the fourth quarter of 2012 and adjusted EBITDA increasing 11% to $21.0 million for the fourth quarter of 2013 from $18.9 million for the fourth quarter of 2012. See Non-GAAP Measures section below. Net sales for the full year of 2013 were $729.4 million compared to $708.2 million for 2012. Earnings per diluted share for 2013 were $4.27 compared to earnings per diluted share of $3.63 for 2012, with non-GAAP earnings per diluted share increasing approximately 10% to $3.84 in 2013 compared to $3.49 in 2012 and adjusted EBITDA increasing 11% to $89.6 million for 2013 from $80.9 million for 2012. See Non-GAAP Measures section below.

Michael F. Barry, Chairman, Chief Executive Officer and President, commented, "We are pleased to close out 2013 with a strong fourth quarter and report a 7% growth in net sales. We are continuing to more than offset the challenging market conditions, including foreign exchange, and to grow our business profitably through taking market share and leveraging our recent acquisitions. In addition, we experienced gross margin improvement as raw material prices have finally stabilized over the last few quarters.”

Mr. Barry continued, "2013 was another very good year for Quaker in terms of revenue, net income, net operating cash flow, and adjusted EBITDA despite a challenging global economy. Also, our shareholder value creation was 45% as we continued with both dividend and share price appreciation. We closed the quarter with a positive net cash/debt position and successfully upsized our bank facility to $300 million earlier this year. Our strong balance sheet position provides us the financial flexibility to pursue our strategic initiatives and acquisitions, which we believe can create significant value for our shareholders.”

Quaker Chemical Corporation

One Quaker Park, 901 E. Hector Street, Conshohocken, PA 19428-2380 USA

P: 610.832.4000 F: 610.832.8682

quakerchem.com

Mr. Barry also noted, "Going into 2014, we expect to see modest market growth in all regions of the world which is a change considering that the global markets have been uneven for the past few years. However, we continue to operate in a competitive environment with some challenging economic conditions and also could incur some increases in raw material costs from current levels. On the other hand, I continue to expect market share gains from our strategic initiatives and recent acquisitions which will build upon the anticipated end market growth. On balance, I remain confident in our future and expect 2014 to be another good year for Quaker as we strive to increase revenue and earnings for the fifth consecutive year.”

Fourth Quarter of 2013 Summary

Net sales for the fourth quarter of 2013 of $184.3 million increased approximately 7% from net sales of $172.9 million in the fourth quarter of 2012, primarily due to an increase in product volumes across all regions.

Gross profit increased approximately $6.0 million, or approximately 10%, from the fourth quarter of 2012, which was primarily driven by an improvement in gross margin to 35.4% for the fourth quarter of 2013 from 34.2% in the fourth quarter of 2012. The increase in gross margin reflects the return of the Company’s product margins to more acceptable levels.

Selling, general and administrative expenses (“SG&A”) increased $4.5 million from the fourth quarter of 2012, which was primarily driven by higher labor related costs on general year-over-year merit increases, increased selling and other related costs on improved Company performance and a non-income tax contingency charge.

The decrease in other income of $1.3 million was primarily the result of lower income in the fourth quarter of 2013 compared to the fourth quarter of 2012 from changes in the fair value of certain contingent consideration liabilities that related to past acquisitions.

Interest expense was lower in the fourth quarter of 2013 compared to the fourth quarter of 2012, primarily due to decreases in average borrowings and interest rates. Interest income was higher in the fourth quarter of 2013 compared to the fourth quarter of 2012, primarily due to an increase in the level of the Company’s cash on hand.

The Company’s effective tax rates for the fourth quarters of 2013 and 2012 were 21.7% and 18.2%, respectively. The primary contributors to the increase in the current quarter’s effective tax rate were lower changes in reserves related to uncertain tax positions and certain one-time discrete items that decreased the fourth quarter of 2012 effective tax rate, partially offset by a change in the mix of income to lower tax jurisdictions in the fourth quarter of 2013.

The increase in equity in net income of associated companies from the fourth quarter of 2012 was primarily due to higher earnings related to the Company’s equity interest in a captive insurance company.

Year-to-Date Summary

Net sales for 2013 of $729.4 million increased approximately 3% from $708.2 million in 2012. The increase in the Company’s net sales from the prior year was primarily due to an increase in product volumes generally across all regions, partially offset by a decrease due to foreign exchange rate translation.

Gross profit increased by approximately $22.4 million, or approximately 9%, from 2012, which was primarily driven by an improvement in gross margin to 35.8% in 2013 from 33.7% in 2012. The increase in gross margin reflects the return of the Company’s product margins to more acceptable levels.

Quaker Chemical Corporation

One Quaker Park, 901 E. Hector Street, Conshohocken, PA 19428-2380 USA

P: 610.832.4000 F: 610.832.8682

quakerchem.com

SG&A increased approximately $14.3 million from 2012, which was primarily driven by higher labor related costs on general year-over-year merit increases, increased selling and other related costs on improved Company performance and costs added with our recent acquisitions. In addition, non-operating SG&A expenses increased due to certain uncommon costs. For instance, 2013 SG&A includes the non-income tax contingency charge noted above and, also, costs related to streamlining certain operations in the Company’s Europe, Middle East and Africa and South America segments. Partially offsetting these increases to SG&A were the prior year costs associated with the bankruptcies of certain U.S customers, the prior year costs associated with the Company’s CFO transition and lower translation due to changes in foreign exchange rates.

Other income in 2013 was generally consistent with 2012. In 2013, the Company recorded other income from a refund related to past excise taxes paid on certain mineral oil sales, which was offset by higher other income in 2012 from changes in the fair value of certain contingent consideration liabilities related to past acquisitions.

The decrease in interest expense from 2012 to 2013 was primarily due to lower average borrowings and lower interest rates in 2013. The increase in interest income from 2012 to 2013 was primarily due to a higher level of the Company’s cash on hand.

The Company’s effective tax rates for 2013 and 2012 were 28.1% and 24.7%, respectively. The primary contributors to the increase in the current year’s effective tax rate were lower changes in reserves related to uncertain tax positions and certain one-time discrete items that decreased the 2012 effective tax rate, partially offset by a change in the mix of income to lower tax jurisdictions during 2013.

The increase in equity in net income of associated companies from 2012 was primarily due to higher earnings related to the Company’s equity interest in a captive insurance company during 2013, including a non-cash out-of-period adjustment recorded in 2013. Partially offsetting this increase in equity in net income of associated companies was a charge recorded in 2013 due to the devaluation of the Venezuelan Bolivar Fuerte.

Changes in foreign exchange rates negatively impacted 2013 net income by approximately $0.7 million, or $0.05 per diluted share.

Balance Sheet and Cash Flow Items

The Company’s net operating cash flow for the fourth quarter of 2013 was $21.8 million, which increased its full year 2013 net operating cash flow to $73.8 million as compared to $62.9 million for 2012. The improvement in the Company’s net operating cash flow during 2013 was primarily driven by increased net income and better working capital management. During 2013, the Company revised its credit facility, expanding the amount available for borrowings under this facility from $175.0 million to $300.0 million, which provides the Company further financial flexibility for potential future initiatives. In addition to the revised facility, the Company’s current liquidity remains strong, as its cash position continued to exceed its debt at December 31, 2013 and its consolidated leverage ratio continued to be less than one times EBITDA.

Non-GAAP Measures

Included in this public release are non-GAAP financial measures of non-GAAP earnings per diluted share and adjusted EBITDA. The Company believes these non-GAAP financial measures provide meaningful supplemental information as they enhance a reader’s understanding of the financial performance of the Company, are more indicative of future operating performance of the Company, and facilitate a better comparison among fiscal periods, as the non-GAAP financial measures exclude items that are not considered core to the Company’s operations. Non-GAAP results are presented for supplemental informational purposes only and should not be considered a substitute for the financial information presented in accordance with GAAP. The following are reconciliations between the non-GAAP (unaudited) financial measures of non-GAAP earnings per diluted share and adjusted EBITDA to their most directly comparable GAAP financial measures:

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	Three Months Ended December 31,						Twelve Months Ended December 31,
	2013			2012			2013			2012
GAAP earnings per diluted share attributable to Quaker Chemical Corporation Common Shareholders	$	1.07		$	0.99		$	4.27		$	3.63
Equity income in a captive insurance company per diluted share		(0.08	)		(0.03	)		(0.41	)		(0.14	)
Mineral oil excise tax refund per diluted share		—			—			(0.14	)		—
Change in acquisition-related earnout liability per diluted share		(0.06	)		(0.09	)		(0.03	)		(0.09	)
Cost streamlining initiatives per diluted share		0.01			—			0.08			—
Devaluation of the Venezuelan Bolivar Fuerte per diluted share		—			—			0.03			—
Non-income tax contingency charge per diluted share		0.04			—			0.04			—
Customer bankruptcy costs per diluted share		—			—			—			0.06
CFO transition costs per diluted share		—			—			—			0.03
Non-GAAP earnings per diluted share	$	0.98		$	0.87		$	3.84		$	3.49

	Three Months Ended December 31,						Twelve Months Ended December 31,
	2013			2012			2013			2012
Net income attributable to Quaker Chemical Corporation	$	14,086		$	13,007		$	56,339		$	47,405
Depreciation and amortization		3,944			4,074			15,784			15,358
Interest expense		699			924			2,922			4,283
Tax expense		3,556			2,883			20,489			15,575
Equity income in a captive insurance company		(1,073	)		(386	)		(5,451	)		(1,812	)
Mineral oil excise tax refund		—			—			(2,540	)		—
Change in acquisition-related earnout liability		(1,172	)		(1,737	)		(497	)		(1,737	)
Cost streamlining initiatives		142			—			1,419			—
Devaluation of the Venezuelan Bolivar Fuerte		—			—			357			—
Non-income tax contingency charge		796			—			796			—
Customer bankruptcy costs		—			98			—			1,254
CFO transition costs		—			—			—			609
Adjusted EBITDA	$	20,978		$	18,863		$	89,618		$	80,935

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Forward-Looking Statements

This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected in such statements. A major risk is that the Company’s demand is largely derived from the demand for its customers’ products, which subjects the Company to downturns in a customer’s business and unanticipated customer production shutdowns. Other major risks and uncertainties include, but are not limited to, significant increases in raw material costs, customer financial stability, worldwide economic and political conditions, foreign currency fluctuations, future terrorist attacks and other acts of violence. Other factors could also adversely affect us. Therefore, we caution you not to place undue reliance on our forward-looking statements. This discussion is provided as permitted by the Private Securities Litigation Reform Act of 1995.

Conference Call

As previously announced, Quaker Chemical’s investor conference call to discuss the fourth quarter of 2013 results is scheduled for February 28, 2014 at 8:00 a.m. (ET). A live webcast of the conference call, together with supplemental information, can be accessed through the Company’s Investor Relations website at http://www.quakerchem.com. You can also access the conference call by dialing 877-269-7756.

About Quaker

Quaker Chemical is a leading global provider of process fluids, chemical specialties, and technical expertise to a wide range of industries, including steel, aluminum, automotive, mining, aerospace, tube and pipe, cans, and others.  For nearly 100 years, Quaker has helped customers around the world achieve production efficiency, improve product quality, and lower costs through a combination of innovative technology, process knowledge, and customized services. Headquartered in Conshohocken, Pennsylvania USA, Quaker serves businesses worldwide with a network of dedicated and experienced professionals whose mission is to make a difference.

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Quaker Chemical Corporation

Consolidated Statement of Income

(In thousands, except per share data)

	(Unaudited)
	Three Months Ended December 31,						Twelve Months Ended December 31,
	2013			2012			2013			2012
Net sales	$	184,297		$	172,868		$	729,395		$	708,226
Cost of goods sold		119,134			113,714			468,320			469,515
Gross profit		65,163			59,154			261,075			238,711
%		35.4	%		34.2	%		35.8	%		33.7	%
Selling, general and administrative expenses		49,931			45,478			189,832			175,487
Operating income		15,232			13,676			71,243			63,224
%		8.3	%		7.9	%		9.8	%		8.9	%
Other income, net		1,557			2,886			3,519			3,415
Interest expense		(699	)		(924	)		(2,922	)		(4,283	)
Interest income		321			183			986			592
Income before taxes and equity in net income of associated companies		16,411			15,821			72,826			62,948
Taxes on income before equity in net income of associated companies		3,556			2,883			20,489			15,575
		12,855			12,938			52,337			47,373
Equity in net income of associated companies		1,825			829			6,514			2,867
Net income		14,680			13,767			58,851			50,240
Less: Net income attributable to noncontrolling interest		594			760			2,512			2,835
Net income attributable to Quaker Chemical Corporation	$	14,086		$	13,007		$	56,339		$	47,405
%		7.6	%		7.5	%		7.7	%		6.7	%
Per share data:
Net income attributable to Quaker Chemical Corporation Common Shareholders - basic	$	1.07		$	0.99		$	4.28		$	3.64
Net income attributable to Quaker Chemical Corporation Common Shareholders - diluted	$	1.07		$	0.99		$	4.27		$	3.63

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Quaker Chemical Corporation

Consolidated Balance Sheet

(In thousands, except par value and share amounts)

	(Unaudited)
	December 31,			December 31,
	2013			2012
ASSETS
Current assets
Cash and cash equivalents	$	68,492		$	32,547
Accounts receivable, net		165,629			154,197
Inventories, net		71,557			72,471
Current deferred tax assets		7,826			6,401
Prepaid expenses and other current assets		15,343			12,194
Total current assets		328,847			277,810
Property, plant and equipment, net		85,488			85,112
Goodwill		58,151			59,169
Other intangible assets, net		31,272			32,809
Investments in associated companies		19,397			16,603
Non-current deferred income taxes		24,724			30,673
Other assets		36,267			34,458
Total assets	$	584,146		$	536,634
LIABILITIES AND EQUITY
Current liabilities
Short-term borrowings and current portion of long-term debt	$	1,395		$	1,468
Accounts payable		72,281			67,586
Dividends payable		3,299			3,208
Accrued compensation		20,801			16,842
Accrued pension and postretirement benefits		1,438			2,188
Current deferred tax liabilities		1,057			253
Other current liabilities		30,585			16,247
Total current liabilities		130,856			107,792
Long-term debt		17,321			30,000
Non-current deferred income taxes		6,394			6,383
Non-current accrued pension and postretirement benefits		37,006			49,916
Other non-current liabilities		47,538			52,867
Total liabilities		239,115			246,958
Equity
Common stock, $1 par value; authorized 30,000,000 shares; issued 2013 - 13,196,140 shares		13,196			13,095
Capital in excess of par value		99,038			94,470
Retained earnings		258,620			215,390
Accumulated other comprehensive loss		(34,700	)		(41,855	)
Total Quaker shareholders' equity		336,154			281,100
Noncontrolling interest		8,877			8,576
Total equity		345,031			289,676
Total liabilities and equity	$	584,146		$	536,634

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Quaker Chemical Corporation

Consolidated Statement of Cash Flows

For the twelve months ended December 31,

(In thousands)

	(Unaudited)
	2013			2012
Cash flows from operating activities
Net income	$	58,851		$	50,240
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		12,339			12,252
Amortization		3,445			3,106
Equity in undistributed earnings of associated companies, net of dividends		(4,162	)		(2,350	)
Deferred income taxes		(30	)		2,354
Uncertain tax positions (non-deferred portion)		(1,826	)		(1,407	)
Acquisition-related fair value adjustments		200			(1,909	)
Deferred compensation and other, net		(259	)		(156	)
Stock-based compensation		4,161			3,807
Loss (gain) on disposal of property, plant and equipment		200			(108	)
Insurance settlements realized		(988	)		(1,391	)
Pension and other postretirement benefits		862			(1,427	)
(Decrease) increase in cash from changes in current assets and current liabilities, net of acquisitions:
Accounts receivable		(11,837	)		779
Inventories		406			3,228
Prepaid expenses and other current assets		(743	)		504
Accounts payable and accrued liabilities		11,301			(2,562	)
Estimated taxes on income		1,881			(2,067	)
Net cash provided by operating activities		73,801			62,893
Cash flows from investing activities
Investments in property, plant and equipment		(11,439	)		(12,735	)
Payments related to acquisitions, net of cash acquired		(2,478	)		(5,635	)
Proceeds from disposition of assets		513			245
Interest earned on an Insurance settlement		52			69
Change in restricted cash, net		936			1,322
Net cash used in investing activities		(12,416	)		(16,734	)
Cash flows from financing activities
Net decrease in short-term borrowings		-			(315	)
Repayments of long-term debt		(12,791	)		(17,632	)
Dividends paid		(13,018	)		(12,616	)
Stock options exercised, other		(307	)		(924	)
Excess tax benefit related to stock option exercises		815			2,045
Distributions to noncontrolling shareholders		(905	)		(1,099	)
Net cash used in financing activities		(26,206	)		(30,541	)
Effect of exchange rate changes on cash		766			20
Net increase in cash and cash equivalents		35,945			15,638
Cash and cash equivalents at the beginning of the period		32,547			16,909
Cash and cash equivalents at the end of the period	$	68,492		$	32,547

EX-99.2

1 Quaker Chemical Corporation Investor Conference Call February 28, 2014 Fourth Quarter and Full Year 2013 Results

2 Regulation G The attached charts include Company information that does not conform to generally accepted accounting principles (GAAP). Management believes that an analysis of this data is meaningful to investors because it provides insight with respect to ongoing operating results of the Company and allows investors to better evaluate the financial results of the Company. These measures should not be viewed as an alternative to GAAP measures of performance. Furthermore, these measures may not be consistent with similar measures provided by other companies. This data should b e read in conjunction with the C ompany’s fourth quarter earnings news release dated February 27, 2014, which has been furnished to the SEC on Form 8-K, and the Company’s Form 10-K for the year ended December 31, 2013, which has been filed with the SEC. Forward-Looking Statements This presentation may contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materiall y from those projected in such statements. A major risk is that the Company’s demand is largely derived from the demand for its customers’ products, which subjects the Company to downturns in a customer’s business and unanticipated customer production shutdowns. Other major risks and uncertainties include, but are not limited to, significant increases in raw material costs, customer financial stability, worldwide economic and political conditions, foreign currency fluctuations, future terrorist attacks and other acts of violence. Other factors could also adversely affect us. Therefore, we caution you not to place undue reliance on our forward-looking statements. This discussion is provided as permitted by the Private Securities Litigation Reform Act of 1995. Risks and Uncertainties Statement

3 Speakers Michael F. Barry Chairman of the Board, Chief Executive Officer & President Margaret M. Loebl Vice President, Chief Financial Officer & Treasurer Robert T. Traub General Counsel Chart #1

4 Fourth Quarter 2013 Headlines ▪ Quarterly net sales growth of 7% despite a challenging economic environment ▪ Significant earnings per share growth compared to fourth quarter 2012 ▪ Strong quarterly performance drives year - to - date operating cash flow to $73.8 million Chart #2

5 Chairman Comments ▪ Q4 2013/Full Year x Solid sales/volume despite quarter seasonality x Strong margin levels continue in tough economy x Gaining share & leveraging acquisitions x Liquidity remains a Company strength x Very good year -- revenue, net income, net operating cash flow and adjusted EBITDA ▪ 2014 Outlook x Modest market growth amongst all regions x Furthering share gains and strategic initiatives x Competition /economic conditions /raw material costs – on - going challenges Q4 2013 And Full Year 2013 Chart #3 “We remain confident in our future and expect 2014 to be another good year for Quaker, as we strive to increase revenue and earnings for the fifth consecutive year.” -- Michael F. Barry, Chairman, CEO & President

6 Product Volume by Quarter Thousand Kilograms 25,000 30,000 35,000 40,000 45,000 50,000 55,000 4Q08 YTD Avg. 1Q092Q09 3Q094Q091Q102Q10 3Q104Q101Q11 2Q113Q114Q111Q12 2Q123Q124Q12 1Q132Q133Q134Q13 Chart #4

7 Financial Snapshot Q4 2013 Q4 2012 YTD 2013 YTD 2012 Net Sales ($Mils.) 184.3 172.9 729.4 708.2 Gross Margin (%) 35.4 34.2 35.8 33.7 Operating Margin (%) 8.3 7.9 9.8 8.9 Net Income attributable to Quaker Chemical Corporation ($Mils.) 14.1 13.0 56.3 47.4 Adjusted EBITDA ($Mils.) – Trailing Twelve Months 89.6 80.9 -- -- Adjusted EBITDA Margin (%) 12.3 11.4 -- -- Earnings Per Diluted Share 1.07 0.99 4.27 3.63 Non - GAAP Earnings Per Diluted Share 0.98 0.87 3.84 3.49 Debt ($Mils.) 18.7 31.5 -- -- Equity ($Mils.) 345.0 289.7 -- -- Net Operating Cash Flow ($Mils.) 21.8 21.1 73.8 62.9 Chart #5

8 Gross Margin Percentage Chart #6 28.0% 34.7% 35.4% 32.6% 33.7% 35.8% 20.0% 25.0% 30.0% 35.0% 40.0% 2008 2009 2010 2011 2012 2013 Gross Margin Percentage 34.2% 35.5% 36.4% 35.9% 35.4% 20.0% 25.0% 30.0% 35.0% 40.0% Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Gross Margin Percentage

9 Adjusted EBITDA Baseline Historical Performance $40.1 $44.2 $66.8 $73.0 $80.9 $89.6 6.90% 9.80% 12.30% 10.70% 11.40% 12.30% 2008 2009 2010 2011 2012 2013 Adjusted EBITDA ($ Mils.) Adjusted EBITDA Margin (%) Chart #7 CAGR: 17.5% +540 Margin bps 2008 – 2013

10 Balance Sheet Net Cash / (Debt) -$100 -$80 -$60 -$40 -$20 $0 $20 $40 $60 $80 2008 2009 2010 2011 2012 2013 $ Millions Cash ST/LT Debt Net Debt Chart #8

11 Net Cash Flow From Operations 21.1 11.3 16.2 24.5 21.8 0 10 20 30 40 50 60 70 80 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Operating Cash Flow ($ Millions) Chart #9 13.4 41.6 37.5 19.7 62.9 73.8 0 10 20 30 40 50 60 70 80 2008 2009 2010 2011 2012 2013 Operating Cash Flow ($ Millions)

12 APPENDIX

13 Chart #10 Non - GAAP Earnings Per Diluted Share Reconciliation Q4 2013 Q4 2012 YTD 2013 YTD 2012 GAAP Earnings Per Diluted Share 1.07$ 0.99$ 4.27$ 3.63$ CFO Transition costs per diluted share -$ -$ -$ 0.03$ Customer bankruptcies per diluted share -$ -$ -$ 0.06$ Mineral oil excise tax refund per diluted share -$ -$ (0.14)$ -$ Non-income tax contingency charge per diluted share 0.04$ -$ 0.04$ -$ Change in acquisition-related earnout liability per diluted share (0.06)$ (0.09)$ (0.03)$ (0.09)$ Cost streamlining inititiatives per diluted share 0.01$ -$ 0.08$ -$ Devaluation of the Venezuelan Bolivar Fuerte per diluted share -$ -$ 0.03$ -$ Equity income in a captive insurance company per diluted share (0.08)$ (0.03)$ (0.41)$ (0.14)$ Non-GAAP Earnings Per Diluted Share 0.98$ 0.87$ 3.84$ 3.49$

14 Annualized Adjusted EBITDA Reconciliation Chart #11 2008 2009 2010 2011 2012 2013 Net income 9,833 16,058 32,120 45,892 47,405 56,339 Depreciation 10,879 9,525 9,867 11,455 12,252 12,339 Amortization 1,177 1,078 988 2,338 3,106 3,445 Interest expense 5,509 5,533 5,225 4,666 4,283 2,922 Taxes on income 4,977 7,065 12,616 14,256 15,575 20,489 Restructuring and related activities 2,916 2,289 - - - - Non-income tax contingency charge - - 4,132 - - 796 Equity affiliate out of period charge - - 564 - - - Mineral oil excise tax refund - - - - - (2,540) Transition costs related to key employees 3,505 2,443 1,317 - 609 - Non-cash gain from the purchase of an equity affiliate - - - (2,718) - - Change in acquisition-related earnout liability - - - (595) (1,737) (497) Equity loss (income) from a captive insurance company 1,299 162 (313) (2,323) (1,812) (5,451) Devaluation of the Venezuelan Bolivar - - 322 - - 357 U.S customer bankruptcies - - - - 1,254 - Cost streamlining initiatives - - - - - 1,419 Adjusted EBITDA 40,095 44,153 66,838 72,971 80,935 89,618 Adjusted EBITDA Margin 6.9% 9.8% 12.3% 10.7% 11.4% 12.3% Multiply Adjusted EBITDA by Annual Run Rate 1 1 1 1 1 1 Annualized Adjusted EBITDA 40,095 44,153 66,838 72,971 80,935 89,618