Northern Technologies International NASDAQ: NTIC outlined its strategy to convert years of investment in its oil and gas corrosion-control and compostable plastics businesses into faster growth, wider margins and higher profitability during the Lytham Partners Fall 2026 Investor Conference.
Chief Financial Officer Matthew Wolsfeld said the materials science company operates a profitable core industrial corrosion business alongside two growth platforms: ZERUST Oil & Gas and Natur-Tec compostable plastics. He said all three businesses have posted record growth in recent quarters.
“The main point of the story today is to kind of explain to you over the last several years how we've made certain investments that we expect to materialize into faster growth, better margins, and higher profitability for the company in the near future,” Wolsfeld said.
Three Business Lines
NTIC’s established ZERUST industrial business protects metal parts from corrosion before assembly. The company provides proprietary packaging products designed to keep automotive, agricultural and general industrial components rust-free without requiring oils and greases before use.
Wolsfeld said the industrial segment generally grows at a rate of GDP plus 4% to 5%, with the company’s core business typically delivering about 8% to 9% year-over-year growth. Historically, he said, NTIC has seen top-line growth of 10% to 15%, although the business faced disruptions related to the period following COVID-19 and ongoing wars.
For the fiscal third quarter ended May 31, the industrial business recorded sales of approximately $16 million, according to Wolsfeld. He estimated the global market for ZERUST industrial products at roughly $600 million.
The segment uses an asset-light model, subcontracting most production to extrusion and manufacturing companies that apply NTIC’s technology to products and ship them to customers. Wolsfeld said that structure enables the company to scale production in response to changing demand.
Oil and Gas Expansion
Wolsfeld identified the oil and gas business as NTIC’s fastest-growing operation and said it could become the company’s largest market over the coming decade. The business applies corrosion-inhibiting technologies to oil and gas infrastructure, with the aim of extending the useful life of customer assets and reducing maintenance costs.
NTIC recently opened a subsidiary in Dubai to pursue opportunities in the Middle East, Wolsfeld said. The company’s oil and gas revenue in the third quarter was about 72% higher year over year, marking a fourth consecutive quarter with more than $2 million in revenue. Trailing 12-month revenue in the business exceeded $10 million.
“We have lots of new business that we are looking for and expecting to convert over the next 12 months internationally,” Wolsfeld said. He added that gross margins in the oil and gas segment are “significantly higher” than those in the industrial business.
Natur-Tec Targets Compostable Plastics Demand
NTIC’s Natur-Tec operation develops compostable plastics and resin formulations. The company sources base resins from suppliers including BASF, Cargill NatureWorks and TotalEnergies Corbion, then modifies them for particular compostable applications.
While Natur-Tec sells finished products certified under ASTM D6400 compostability standards, Wolsfeld said its principal growth opportunity is in developing proprietary resin formulations for customers’ specific applications. The company is working with plastics manufacturers seeking compostable materials that can replicate characteristics of polyethylene, including tensile strength and heat deflection.
Wolsfeld said Natur-Tec has experienced growth in the United States, India, China and Europe, driven in part by environmental considerations and customer demand for compostable alternatives.
Global Model and Profitability Goals
NTIC operates in more than 65 countries through 15 joint ventures and 11 subsidiaries, Wolsfeld said. Its subsidiaries are fully consolidated, while joint ventures are accounted for using equity consolidation. As a result, joint-venture revenue does not appear in NTIC’s GAAP revenue, though the company receives joint-venture operating income, royalties and dividends.
The CFO said the structure has allowed NTIC to establish an international footprint efficiently and continues to provide meaningful cash contributions. As sales grow across the oil and gas and Natur-Tec businesses, he said the company expects to leverage its existing fixed-cost base, allowing incremental gross-margin dollars to flow more directly to operating income.
Wolsfeld said the anticipated margin expansion could improve free cash flow, support debt reduction and drive earnings-per-share growth. While industrial revenue is expected to continue rising in dollar terms, he expects it to represent a smaller share of total revenue as the newer businesses expand.
About Northern Technologies International (NASDAQ:NTIC)
Northern Technologies International Corporation NASDAQ: NTIC develops and markets products and services designed to protect materials from corrosion and support more sustainable packaging and plastics applications. The company's corrosion-management business operates primarily under the Zerust brand and serves industrial customers that need to protect metal components and equipment during storage, transportation and manufacturing.
Zerust products include corrosion-inhibiting packaging, films, foams, emitters, coatings, oils and other solutions that help prevent corrosion without requiring traditional protective treatments.
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