NL Industries : NL Reports Fourth Quarter Results

              NL Industries : NL Reports Fourth Quarter Results

DALLAS, TEXAS - March 12, 2013 - NL Industries, Inc. (NYSE: NL) today reported
income from continuing operations attributable to NL stockholders of $2.7
million, or $.05 per share, in the fourth quarter of 2012 compared to income
from continuing operations of $19.7 million, or $.40 per share, in the fourth
quarter of 2011. For the full year 2012, NL reported income from continuing
operations attributable to NL stockholders of $56.6 million, or $1.16 per
share compared to income from continuing operations of $78.1 million, or $1.61
per share, in 2011.

Net sales increased 3% in the fourth quarter of 2012 as compared to the fourth
quarter 2011 and increased 4% in the full year 2012 compared to 2011. Net
sales increased principally due to growth in customer demand within both of
CompX's businesses resulting from somewhat improved economic conditions in
North America. Income from continuing operations attributable to CompX
decreased to nil and $5.4 million, in the fourth quarter and full year of
2012, respectively, compared to income from continuing operations of $1.4
million and $6.4 million in the same periods of 2011. Income from continuing
operations comparisons were negatively impacted by higher self-insured medical
costs in 2012. In addition, the 2011 and 2012 full-year periods include the
impact of write-downs on assets held for sale of $1.1 million and $1.2
million, respectively ($.02 per share, net of income taxes and noncontrolling
interest, in both periods).

Kronos' net sales of $396.8 million in the fourth quarter of 2012 were $40.6
million, or 9%, lower than in the fourth quarter of 2011. Kronos' net sales
of $1,976.3 million in the full year of 2012 were $33.0 million, or 2%, higher
than in the full year 2011. Net sales decreased in the fourth quarter of 2012
as compared to the fourth quarter of 2011 due to lower average TiO[2] selling
prices partially offset by higher sales volumes. Net sales increased in the
full year of 2012 primarily due to higher average TiO[2] selling prices,
partially offset by lower sales volumes. Kronos' average TiO[2] selling
prices decreased 14% in the fourth quarter of 2012 as compared to the fourth
quarter of 2011, and increased 10% for the full year as compared to 2011.
Kronos' average TiO[2] selling prices at the end of 2012 were 17% lower than
at the end of 2011 and were 10% lower than at the end of the third quarter of
2012. TiO[2 ]sales volumes in the fourth quarter of 2012 were 6% higher than
in the fourth quarter of 2011, while sales volumes for the full year 2012 were
6% lower than in 2011. Fluctuations in currency exchange rates also impacted
net sales comparisons, decreasing net sales by approximately $12 million in
the fourth quarter and approximately $82 million in the full year 2012 as
compared to 2011. The table at the end of this press release shows how each
of these items impacted Kronos' overall change in sales.

Kronos' income from operations decreased by $142.2 million, from $143.3
million in the fourth quarter of 2011 to $1.1 million in the fourth quarter of
2012. For the full year, Kronos' income from operations decreased by $186.9
million from $546.5 million in 2011 to $359.6 million in 2012. Income from
operations decreased in the fourth quarter period primarily due to the
negative effects of lower TiO[2] selling prices, lower production volumes and
higher raw material costs offset in part by increased sales volume. Income
from operation decreased for the full year primarily due to lower sales and
production volumes, higher raw material costs and the unfavorable effects of
unabsorbed fixed production costs resulting from reduced production volumes,
partially offset by higher average sales prices. Changes in currency exchange
rates decreased Kronos' income from operations by approximately $9 million in
the fourth quarter and $10 million in the full year 2012 as compared to the
same periods in 2011.

As previously reported, in March 2011 Kronos redeemed €80 million principal
amount of its 6.5% Senior Secured Notes due 2013, and in the third and fourth
quarters of 2011, Kronos repurchased in open market transactions an aggregate
€40.8 million principal amount of its Senior Notes. As a result of these
redemptions and open market purchases, Kronos' results in 2011 include a net
charge of $3.1 million (NL's equity interest was $.4 million, or $.01 per
share, net of income tax benefit) consisting of the call premium, the
write-off of unamortized deferred financing costs and original issue discount
associated with the redeemed and purchased Notes. In June 2012, Kronos
entered into a new $400 million term loan and used a portion of the net
proceeds to redeem the remaining €279.2 million principal amount of Senior
Notes outstanding. As a result, Kronos recognized a second quarter 2012
charge of $7.2 million (NL's equity interest was $.9 million or $.02 per
share, net of income tax) associated with the early extinguishment of such
remaining Senior Notes. 

Kronos' income tax expense in 2011 includes a provision for income taxes of
$17.2 million (NL's equity was $3.4 million, or $.07 per share, net of income
taxes) for U.S. incremental income taxes on earnings repatriated from its
German subsidiary, which earnings were used to fund a portion of the
repurchases of Kronos' Senior Secured Notes.

Insurance recoveries reflect in part amounts we received from certain of our
former insurance carriers, and relate to the recovery of prior lead pigment
and asbestos litigation defense costs incurred by us. Such insurance
recoveries aggregated $3.3 million ($2.2 million, or $.04 per share, net of
income taxes) in 2012 as compared to $16.9 million ($11.0 million, or $.23 per
share, net of income taxes) in 2011. A substantial portion of the insurance
recoveries we recognized in 2011 relates to a settlement we reached for a
portion of our past lead pigment litigation costs.

Litigation settlement gain in 2012 relates to a $15.0 million gain ($9.7
million, or $.20 per share, net of income taxes) recognized in the second
quarter related to the third and final closing associated with certain real
property we formerly owned in New Jersey.

Other operating income in the fourth quarter of 2012 includes a $3.2 million
gain ($2.1 million, or $.04 per share after taxes) on the sale of certain real
property owned by us. In addition, we recognized a $6.4 million goodwill
impairment charge ($.13 per share) in the fourth quarter of 2012 associated
with our insurance brokerage subsidiary. There is no income tax benefit
associated with such charge.

Corporate expenses were comparable in the 2011 and 2012 fourth quarter
periods, and increased $4.0 million, or 16%, in the full year 2012 compared to
2011 primarily related to higher environmental and related costs in the first
quarter of 2012.

Securities transactions gains in the fourth quarter of 2012 consist of a $16.6
million gain ($10.8 million, or $.22 per share after taxes) on the sale,
pursuant to a cash tender offer by a third party, of all of our shares of
Titanium Metals Corporation (TIMET) common stock for $23.9 million.

In December 2012, we completed the sale of CompX's Furniture Components
operations to a competitor for proceeds, net of expenses, of approximately
$58.0 million in cash. We recognized a pre-tax gain of approximately $23.7
million in the fourth quarter of 2012 ($14.5 million, or $.30 per share, net
of income taxes and noncontrolling interests). Discontinued operations also
includes full-year income related to the operations of such disposed unit of
$3.5 million, or $.07 per share, in 2011 and $3.3 million, or $.07 per share
in 2012, net of income taxes and noncontrolling interest. We have
reclassified our Condensed Consolidated Statement of Operations to reflect the
disposed business as discontinued operations for all periods.

The statements in this release relating to matters that are not historical
facts are forward-looking statements that represent management's beliefs and
assumptions based on currently available information. Although NL believes
that the expectations reflected in such forward-looking statements are
reasonable, we cannot give any assurances that these expectations will prove
to be correct. Such statements by their nature involve substantial risks and
uncertainties that could significantly impact expected results, and actual
future results could differ materially from those described in such
forward-looking statements. While it is not possible to identify all factors,
we continue to face many risks and uncertainties. Among the factors that
could cause actual future results to differ materially include, but are not
limited to:

  oFuture supply and demand for our products
  oThe extent of the dependence of certain of our businesses on certain
    market sectors
  oThe cyclicality of our businesses (such as Kronos' TiO[2 ]operations)
  oUnexpected or earlier-than-expected industry capacity expansion (such as
    the TiO[2 ]industry)
  oChanges in raw material and other operating costs (such as energy, ore,
    zinc and brass costs) and our ability to pass those costs on to our
    customers or offset them with reductions in other operating costs
  oChanges in the availability of raw material (such as ore)
  oGeneral global economic and political conditions (such as changes in the
    level of gross domestic product in various regions of the world and the
    impact of such changes on demand for, among other things, TiO[2 ]and
    component products)
  oCompetitive pricing, products and substitute products
  oCustomer and competitor strategies
  oUncertainties associated with the development of new product features
  oPotential consolidation of Kronos' competitors
  oThe impact of pricing and production decisions
  oCompetitive technology positions
  oPotential difficulties in integrating future acquisitions
  oPotential difficulties in upgrading or implementing new manufacturing and
    accounting software systems
  oThe introduction of trade barriers
  oPossible disruption of Kronos' or CompX's business, or increases in our
    cost of doing business resulting from terrorist activities or global
    conflicts
  oThe impact of current or future government regulations (including employee
    healthcare benefit related regulations
  oFluctuations in currency exchange rates (such as changes in the exchange
    rate between the U.S. dollar and each of the euro, the Norwegian krone and
    the Canadian dollar), or possible disruptions to our business resulting
    from potential instability resulting from uncertainties associated with
    the euro
  oOperating interruptions (including, but not limited to, labor disputes,
    leaks, natural disasters, fires, explosions, unscheduled or unplanned
    downtime, transportation interruptions and cyber attacks)
  oDecisions to sell operating assets other than in the ordinary course of
    business
  oCompX's and Kronos' ability to renew or refinance debt
  oOur ability to maintain sufficient liquidity
  oThe timing and amounts of insurance recoveries
  oThe extent to which our subsidiaries or affiliates were to become unable
    to pay us dividends
  oThe ultimate outcome of income tax audits, tax settlement initiatives or
    other tax matters
  oUncertainties associated with the development of new product features
  oOur ability to utilize income tax attributes or changes in income tax
    rates related to such attributes, the benefits of which have been
    recognized under the more-likely-than-not recognition criteria
  oEnvironmental matters (such as those requiring compliance with emission
    and discharge standards for existing and new facilities or new
    developments regarding environmental remediation at sites related to our
    former operations)
  oGovernment laws and regulations and possible changes therein (such as
    changes in government regulations which might impose various obligations
    on present and former manufacturers of lead pigment and lead-based paint,
    including us, with respect to asserted health concerns associated with the
    use of such products)
  oThe ultimate resolution of pending litigation (such as our lead pigment
    and environmental matters)
  oPossible future litigation.

Should one or more of these risks materialize (or the consequences of such a
development worsen), or should the underlying assumptions prove incorrect,
actual results could differ materially from those currently forecasted or
expected. We disclaim any intention or obligation to update or revise any
forward-looking statement whether as a result of changes in information,
future events or otherwise.

NL Industries, Inc. is engaged in the component products (security products
and performance marine components), chemicals (TiO[2]) and other businesses.

Source: NL Industries, Inc.
Contact: Gregory M. Swalwell, Vice President, Finance and Chief Financial
Officer, 972-233-1700

NL INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In millions, except earnings per share)

                         Three months ended               Year ended
                            December 31,                 December 31,
                         2011          2012          2011         2012
                             (Unaudited)                       
                                                            
Net sales             $ 18.7     $ 19.3     $ 79.8     $ 83.2
Cost of sales          13.2     13.8     55.7     58.9
                                                            
 Gross margin      5.5    5.5    24.1     24.3
                                                            
Selling, general and
administrative         4.1    4.7    16.6     17.7
expense
Other operating                                              
income (expense):
 Insurance         .3   .7   16.9     3.3
recoveries
 Litigation        -   -   -   15.0
settlement gain
 Assets held for   -   (.8)   (1.1)  
sale write-down                                                    (1.2)
 Other income,     .9   3.6    1.0    3.6
net
 Goodwill          -   (6.4)   -  
impairment                                                         (6.4)
 Corporate         (4.4)   (4.4)   (25.0)    (29.0)
expense
                                                            
 Loss from    (1.8)   (6.5)   (.7)  
operations                                                         (8.1)
                                                            
Equity in earnings
(loss) of Kronos       26.1     (5.6)   97.6     66.4
Worldwide, Inc.
                                                            
General corporate                                            
items:
 Securities        -   16.6     -   16.6
transactions gains
 Interest and      .8   .8   3.0    3.2
dividends
 Interest expense  (.2)   (.2)   (1.5)  
                                                                   (1.1)
                                                            
 Income from
continuing operations  24.9     5.1    98.4     77.0
 before
income taxes
                                                            
Provision for income   5.1    2.4    19.8     19.9
taxes
                                                            
 Income from         19.8     2.7    78.6     57.1
continuing operations
 Income from
discontinued           .3   18.6     4.1    21.9
operations, net of
tax
                                                            
Net income             20.1     21.3     82.7     79.0
                                                            
 Noncontrolling
interest in net        .2   3.7    1.0    4.5
income of subsidiary
                                                            
Net income
attributable to NL    $ 19.9     $ 17.6     $ 81.7     $ 74.5
stockholders
                                                            

NL INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In millions, except earnings per share)

                           Three months ended             Year ended
                              December 31,               December 31,
                           2011         2012         2011         2012
                              (Unaudited)                      
                                                            
Amounts attributable to                                      
NL stockholders:
                                                            
 Income from       $ 19.7     $ 2.7   $ 78.1    $ 56.6
continuing operations
 Income from        .2   14.9    3.6   17.9
discontinued operations
 Net income
attributable to NL      $ 19.9     $ 17.6    $ 81.7    $ 74.5
stockholders
                                                            
 Basic and diluted                                      
net income per share:
 Income from    $ .40    $ .05   $ 1.61    $ 1.16
continuing operations
 Discontinued    .01    .31   .07   .37
operations
 Net income
per share attributable  $ .41    $ .36   $ 1.68    $ 1.53
to NL stockholders
                                                            
 Weighted average                                       
shares outstanding used
 in the
calculation of net          48.7         48.7         48.7         48.7
income per share
                                                            

NL INDUSTRIES, INC.
COMPONENTS OF LOSS ATTRIBUTABLE
TO CONTINUING OPERATIONS
(In millions)
(Unaudited)

                            Three months ended             Year ended
                               December 31,               December 31,
                            2011         2012         2011         2012
                                                             
CompX - component         $ 1.4     $ -   $ 6.4     $ 5.4
products
Insurance recoveries       .3    .7      16.9         3.3
Litigation settlement      -   -   -   15.0
gain
Other income, net          .9    3.6     1.0     3.6
Goodwill impairment        -   (6.4)    -   (6.4)
Corporate expense          (4.4)    (4.4)    (25.0)     (29.0)
                                                             
 Loss from           $ (1.8)    $ (6.5)    $ (.7)   $ (8.1)
operations
                                                             

CHANGE IN KRONOS' TiO[2] SALES
(Unaudited)

                                        Three months ended   Year ended
                                           December 31,     December 31,
                                          2012 vs. 2011     2012 vs. 2011
                                                                   
Percentage change in sales:                                         
 TiO[2] product pricing                   (14)   %       10     %
 TiO[2] sales volume                      6   %       (6)   %
 TiO[2] product mix                       2   %        2    %
 Changes in currency exchange rates      (3)  %     (4) %
                                                                   
 Total                              (9)  %     2  %
                                                                   

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