Hello, everyone, and thank you all for joining us during the Lytham Partners Fall 2026 Investor Conference. My name is Roger Weiss, and I'm a Vice President here at Lytham Partners. Joining us today is Matthew Wolsfeld, Chief Financial Officer at Northern Technologies International Corporation, who will be taking us through a brief slide presentation. We should note that the company trades under the Nasdaq ticker symbol NTIC. With that said, let's get started. Matthew, welcome.
Thanks so much, Roger. I appreciate the introduction.
It's our pleasure having you, and I'm going to turn the floor over to you for the presentation.
Great, thanks. I have about 15 minutes of your time to talk about Northern Technologies International Corporation. We're a 15-year-old material science company with a profitable core corrosion business, plus two major growth platforms that we're working on. One that is from the Oil & Gas , dealing with corrosion in the Oil & Gas space , and the other with compostable plastics. We operate globally through a very capital-efficient structure. 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. With that, kind of going through the disclaimer. Getting into a little bit about the current momentum.
Over the past couple of quarters, we've seen record growth across all three of the businesses that I just went through, the industrial business, the Oil & Gas business, and the Natur-Tec business, with significant year-over-year growth. The main point is from an investor standpoint, is to understand the kind of the investments we've made in the past and the growth that we've seen over these past couple of years, and how we expect that to correlate into significant gross margin and ultimately earnings per share growth over the coming years. I talked about the three individual businesses that we run. Two of them are under the ZERUST umbrella. One is what I would consider the core industrial business, which is where essentially, we're protecting metal parts from corrosion, typically before they're used in assembly.
If you think of car parts, agriculture parts, general industrial components that would potentially rust, we have a long history of developing proprietary packaging products, essentially to make it so that these products can be used in assembly, where they don't have to be dipped in oils and greases in order to be rust-free before use. That business started in the late 1970s and early 1980s, and we have been pioneers in that industry for some time. Over the past, let's say, decade, we've developed new businesses, specifically the ZERUST Oil & Gas business, where we're taking similar chemistries to what we do from an industrial space, but we're applying it to oil and gas infrastructure to protect the oil and gas infrastructure from corrosion.
Essentially making sure that the infrastructure is fit for use and ultimately saving our clients time and money from the standpoint of maintaining their infrastructure. The other industry, the other market that we're into that's been very fast-growing, especially with what's going on from an environmental standpoint around the world, is the Natur-Tec product line. What we do is we essentially develop compostable plastics. We take base resins from large resin companies like BASF, Cargill NatureWorks, TotalEnergies Corbion, and we modify those resins to make very specific compostable resins, where companies will either make finished products with the resins, or we actually develop proprietary resins so our clients can manufacture their own plastic products out of our resins so that they can have a compostable base. Overall, kind of looking at the company at a glance.
The industrial business I mentioned is established, profitable, cash-generating, has been around for some time. The Oil & Gas market is kind of our fastest growing market, and which we expect to be the largest market, going forward as far as what NTIC will be operating in for the coming, let's say, the coming decade. Then the Natur-Tec business that I explained as far as the proprietary compostable resins. All are growing right now. We made significant investments in them over the past few years, and now we're at a point where we expect to harvest some of the growth and some of the investments that we've made, which should correlate back, as I said, to gross margin and earnings per share. We are a global company.
We have an interesting setup from the standpoint that we are a micro-cap Nasdaq company, but we are currently operating in over 65 countries. We have a series of 15 joint ventures and 11 subsidiaries that we have. The subsidiaries are fully consolidated from a revenue standpoint and from an operating standpoint, while we have an equity consolidation of the joint ventures. It makes our income statement look a little bit different, but ultimately what you have is you have a model where we are generating significant cash coming back from our joint ventures throughout the world that comes back to us in the form of royalties and/or dividends. It's allowed us to, in a very efficient manner, go to market in all of these different regions.
Ultimately, when we were a small company starting out, we were able to have a much larger footprint when we established these local partners around the world. As far as jumping into what are the strategic objectives of the company and how we expect to continue the growth of the businesses and what's essentially the main objective that we have. Overall, we are shooting for very high-level top-line growth. The industrial business tends to grow at a GDP + 4% or 5% range. Typically, our core business is growing at about 8% or 9% per year-over-year. We hit some obstacles, obviously, coming out of COVID. There's certainly been some impact from the wars that are taking place now and things like that. Ultimately, we've historically seen a top-level, 10%-15% year-over-year growth.
The objective of the company at this point in time is to continue the industrial growth while capitalizing on the new markets that we're entering into, specifically the Oil & Gas market and the Natur-Tec market. The benefit to that is that the Oil & Gas market is a significantly bigger market than what we are currently seeing from an industrial standpoint. Also, the margins that we're achieving in that space are also significantly stronger. Ultimately, I think that's going to push more gross margin dollars to the bottom line. Similarly, from a Natur-Tec standpoint, we're seeing significant growth in the Natur-Tec market that is both in the United States, in India, in China, and in Europe, where we've been able to push a lot of these opportunities out and develop a lot of these opportunities with these new customers to generate significant growth.
The company has spent a significant amount of money over the past, let's say, decade to grow both the Oil & Gas business and the Natur-Tec business to levels where they are now. We feel that we're in a position where we can now leverage, let's say, the fixed expenses that we have in place so that every incremental gross margin dollar that we receive should fall down to the operating income line where we shouldn't have significant operating expense growth as we see the growth in these different business units. Ultimately, that's something that's going to improve our free cash flow, allow us to reduce our debt, and allow us to grow from an EPS standpoint. Again, you can see the diversification that we have from a product category standpoint.
If you look back where we were 10 years ago, you can see the majority of the revenues that we had were from the ZERUST industrial space, where you can now see the significant growth that we are seeing from both the Oil & Gas space and the Natur-Tec space. We expect that the blue in this pie, the amount of total revenue that we see from the industrial space to continue to decline as a percentage, even though it will ultimately continue to increase from a total dollar standpoint. Dipping into each individual space. Again, we talk about the industrial business. Third quarter in 2026, which is the quarter that ended May 31st, we saw record sales. They were coming up at about $16 million year-over-year for the quarter.
At this point in time, we are still continuing to see opportunities where we can be more efficient and go after the approximate $600 million global market that we are seeing for the ZERUST industrial business. Again, it is a very asset-light model. We subcontract out the majority of the production. The product that we are making for our customers is typically subcontracted out to commodity extrusion and manufacturing companies that can apply our technology to the product, and ultimately, we can drop ship to the customers. So it allows for a very asset-light model.
It allows us to scale up or down as we see variances happen and different things that impact, either from a positive or a negative, the business. The Oil & Gas growth has also been significant. We just opened up a new subsidiary in Dubai, in the Middle East, where we are seeing significant growth coming.
We have a lot of opportunities given the new technologies that we have put forward from an Oil & Gas space. We have been able to show that our technology can allow our customers' infrastructure to last significantly longer than what they have seen with traditional corrosion inhibiting solutions. In our third quarter, we are about 72% higher than where we were with our fourth straight quarter, over $2 million worth of revenue with a trailing 12 months now above $10 million.
We have lots of new business that we are looking for and expecting to convert over the next 12 months internationally. Ultimately, the gross margins that we are seeing in the Oil & Gas space, as I said, are significantly higher than we see than from an industrial standpoint. So that should allow us to generate significant cash and significant earnings from that business as it expands.
Lastly, we are also seeing the growth I talked about from the Natur-Tec product line. As I noted before, we sell finished products through the Natur-Tec space that are all the ASTM D6400 certified compostable plastics. But the major growth that we are seeing is where we are developing proprietary resin formulations for specific customers for their specific applications. So we are working with many large companies that are generating plastics, where they want to produce a compostable product where we can manufacture and we can provide them with a base resin that will be able to mirror the tensile strength, the heat deflection, and all the different characteristics that they have traditionally seen out of polyethylene.
We are able to mirror that with the compostable product lines. So it is certainly an area, given what is going on from an environmental standpoint, that we expect to see significant growth over the coming years.
Again, we talked about the increase in gross margin and the expectations of pushing more gross margin dollars to the bottom line. It's something that we have seen throughout the past five years, and we expect to continue to see that going forward. Again, these things should correlate to higher profitability overall from a corporate standpoint as we're consolidating sales and we're seeing the gross profits that are flowing to the bottom line. The joint venture income that we're seeing still remains a meaningful, capital-efficient contributor that obviously helps the company operate at a very profitable level. From a financial performance standpoint, I can talk a little bit about just the one thing to note is that the 16 joint ventures that I mentioned do have. The revenues from the 16 joint ventures that I mentioned don't come through from a GAAP standpoint.
Ultimately, since they're equity consolidated, we do not consolidate the revenues that they have. But ultimately, we take that back in joint venture operating income that comes through the middle of our income statement. With that, I'd like to turn it back over to Roger for the closing remarks. Thanks so much for your attention.
Matthew, thank you very much. Also, I'd like to say thank you to everybody who's now watching us. If you have any questions or would like to schedule a meeting with Northern Tech, please send me an email at weiss@lythampartners.com. If you'd like to learn more about Lytham Partners, you can visit our website at lythampartners.com or follow us on LinkedIn to stay connected about our future events. We hope you all enjoy the rest of the conference and have a great day.