SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

                  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934





For the quarter ended   June 30, 2006           Commission file number 1-31763
                       ---------------                                 -------




                             KRONOS WORLDWIDE, INC.
-------------------------------------------------------------------------------
             (Exact name of Registrant as specified in its charter)




           Delaware                                             76-0294959
-------------------------------                            -------------------
(State or other jurisdiction of                               (IRS Employer
 incorporation or organization)                            Identification No.)


             5430 LBJ Freeway, Suite 1700, Dallas, Texas 75240-2697
-------------------------------------------------------------------------------
            (Address of principal executive offices)     (Zip Code)



Registrant's telephone number, including area code:             (972)233-1700
                                                                --------------


Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months and (2) has been subject to such filing requirements for
the past 90 days. Yes X No

Indicate by check mark whether the Registrant is a large  accelerated  filer, an
accelerated  filer or a  non-accelerated  filer (as defined in Rule 12b-2 of the
Securities  Exchange Act of 1934).  Large  accelerated filer Accelerated filer X
Non-accelerated filer

Indicate by check mark whether the  Registrant is a shell company (as defined in
Rule 12b-2 of the Act). Yes No X

Number of shares of the Registrant's  common stock outstanding on July 28, 2006:
48,953,049.






                     KRONOS WORLDWIDE, INC. AND SUBSIDIARIES

                                      INDEX




                                                                           Page
                                                                          number

Part I.    FINANCIAL INFORMATION

  Item 1.  Financial Statements

           Condensed Consolidated Balance Sheets -
            December 31, 2005; June 30, 2006 (unaudited)                     3

           Condensed Consolidated Statements of Income -
            Three and six months ended June 30, 2005 and 2006
            (unaudited)                                                      5

           Condensed Consolidated Statements of Comprehensive Income -
            Six months ended June 30, 2005 and 2006 (unaudited)              6

           Condensed Consolidated Statement of Stockholders' Equity -
            Six months ended June 30, 2006 (unaudited)                       7

           Condensed Consolidated Statements of Cash Flows -
            Six months ended June 30, 2005 and 2006 (unaudited)              8

           Notes to Condensed Consolidated Financial Statements
           (unaudited)                                                      10

  Item 2.  Management's Discussion and Analysis of Financial
            Condition and Results of Operations                             17

  Item 3.  Quantitative and Qualitative Disclosure About Market Risk        26

  Item 4.  Controls and Procedures                                          26

Part II.   OTHER INFORMATION

  Item 1.  Legal Proceedings                                                28

  Item 1A. Risk Factors                                                     28

  Item 4.  Submission of Matters to a Vote of Security Holders              28

  Item 6.  Exhibits                                                         28

  Items 2, 3, and 5 of Part II are omitted because there is no information to
  report





                     KRONOS WORLDWIDE, INC. AND SUBSIDIARIES

                      CONDENSED CONSOLIDATED BALANCE SHEETS

                                 (In thousands)

<TABLE>

               ASSETS                                           December 31,           June 30,
                                                                    2005                 2006
                                                                ------------          ----------
                                                                                      (Unaudited)
 Current assets:
   <S>                                                            <C>                 <C>
   Cash and cash equivalents
                                                                  $   72,029          $  61,428
   Restricted cash                                                     1,355              1,227
   Accounts and other receivables, net                               184,584            249,592
   Receivables from affiliate                                              2                233
   Refundable income taxes                                             1,053              1,978
   Inventories, net                                                  259,844            255,935
   Prepaid expenses                                                    4,290              5,643
   Deferred income taxes                                               2,187              1,263
                                                                  ----------         ----------

       Total current assets                                          525,344            577,299
                                                                  ----------         ----------

 Other assets:
     Investment in TiO2 manufacturing joint venture                  115,308            115,558
     Deferred income taxes                                           213,722            228,003
     Other                                                            25,638             25,810
                                                                  ----------         ----------

       Total other assets                                            354,668            369,371
                                                                  ----------         ----------

 Property and equipment:
   Land                                                               31,678             33,820
   Buildings                                                         184,800            196,669
   Equipment                                                         786,953            840,631
   Mining properties                                                  68,165             72,369
   Construction in progress                                           13,457             11,543
                                                                  ----------         ----------

                                                                   1,085,053          1,155,032
   Less accumulated depreciation and amortization                    666,133            721,696
                                                                  ----------         ----------

       Net property and equipment                                    418,920            433,336
                                                                  ----------         ----------

       Total assets                                               $1,298,932         $1,380,006
                                                                  ==========         ==========
</TABLE>





                     KRONOS WORLDWIDE, INC. AND SUBSIDIARIES

                CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED)

                                 (In thousands)

<TABLE>


    LIABILITIES AND STOCKHOLDERS' EQUITY                         December 31,          June 30,
                                                                    2005                 2006
                                                                ------------          ----------

 Current liabilities:
<S>                                                               <C>                <C>
   Current maturities of long-term debt                           $      958         $      983
   Accounts payable and accrued liabilities                          165,545            167,605
   Payable to affiliates                                              10,382              9,889
   Income taxes                                                       24,014              6,434
   Deferred income taxes                                               4,211                775
                                                                  ----------         ----------

          Total current liabilities                                  205,110            185,686
                                                                  ----------         ----------

 Noncurrent liabilities:
   Long-term debt                                                    464,365            539,855
   Deferred income taxes                                              53,383             53,218
   Accrued pension costs                                             139,786            138,269
   Accrued postretirement benefits costs                              10,174             10,124
   Other                                                              16,055             17,310
                                                                  ----------         ----------

       Total noncurrent liabilities                                  683,763            758,776
                                                                  ----------         ----------

 Minority interest                                                        75                 80
                                                                  ----------         ----------


 Stockholders' equity:
   Common stock                                                          489                489
   Additional paid-in capital                                      1,061,539          1,061,644
   Retained deficit                                                 (441,295)          (437,170)
   Accumulated other comprehensive loss:
     Currency translation                                           (114,930)           (93,680)
     Pension liabilities                                             (95,819)           (95,819)
                                                                  ----------         ----------

       Total stockholders' equity                                    409,984            435,464
                                                                  ----------         ----------

       Total liabilities, minority interest and
             stockholders' equity                                 $1,298,932         $1,380,006
                                                                  ==========         ==========
</TABLE>



Commitments and contingencies (Notes 10 and 11)







     See accompanying Notes to Condensed Consolidated Financial Statements.





                     KRONOS WORLDWIDE, INC. AND SUBSIDIARIES

                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME

                      (In thousands, except per share data)

<TABLE>

                                                                      Three months ended              Six months ended
                                                                           June 30,                       June 30,
                                                                    ---------------------          ----------------------
                                                                    2005             2006            2005            2006
                                                                    ----             ----            ----            ----
                                                                                         (unaudited)

<S>                                                               <C>             <C>             <C>             <C>
Net sales                                                         $311,688        $ 345,101       $ 603,562       $ 649,380
Cost of sales                                                      217,048          263,107         424,725         492,602
                                                                  --------        ---------       ---------       ---------

    Gross margin                                                    94,640           81,994         178,837         156,778

Selling, general and administrative expense                         37,844           41,298          75,097          79,117
Other operating income (expense):
  Currency transaction gains (losses), net                           2,395           (2,029)          3,323          (2,870)
  Disposition of property and equipment                               (120)            (675)           (154)         (1,107)
  Other income                                                          76               47             112              57
  Corporate expense                                                 (1,448)          (1,284)         (2,873)         (2,602)
                                                                  --------        ---------       ---------       ---------

    Income from operations                                          57,699           36,755         104,148          71,139

Other income (expense):
  Trade interest income                                                142              404             220             879
  Other interest income                                                279              926             620           1,030
  Securities transaction gain                                        5,439             -              5,439            -
  Loss on prepayment of debt                                          -             (22,311)           -            (22,311)
  Interest expense                                                 (11,625)         (13,095)        (23,397)        (23,804)
                                                                  --------        ---------       ---------       ---------

    Income before income taxes and minority interest                51,934            2,679          87,030          26,933

Provision for income taxes (benefit)                                19,066          (10,893)         32,757          (1,673)

Minority interest in after-tax earnings                                  3                2               7               5
                                                                  --------        ---------       ---------       ---------

    Net income                                                    $ 32,865        $  13,570       $  54,266       $  28,601
                                                                  ========        =========       =========       =========

Basic and diluted net income per share                            $    .67        $     .28       $    1.11       $     .58
                                                                  ========        =========       =========       =========

Cash dividends per share                                          $    .25        $     .25       $     .50       $     .50
                                                                  ========        =========       =========       =========

Basic and diluted weighted-average shares used in the
   calculation of net income per share                              48,948           48,951          48,947          48,950
                                                                  ========        =========       =========       =========

</TABLE>



     See accompanying Notes to Condensed Consolidated Financial Statements.


                     KRONOS WORLDWIDE, INC. AND SUBSIDIARIES

            CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

                     Six months ended June 30, 2005 and 2006

                                 (In thousands)


<TABLE>

                                                          2005             2006
                                                          ----             ----
                                                               (Unaudited)

<S>                                                     <C>               <C>
Net income                                              $54,266           $28,601

Other comprehensive income, net of tax -
   currency translation adjustment                        4,224            21,250
                                                        -------           -------

          Comprehensive income                          $58,490           $49,851
                                                        =======           =======
</TABLE>





     See accompanying Notes to Condensed Consolidated financial statements.




                     KRONOS WORLDWIDE, INC. AND SUBSIDIARIES

            CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

                         Six months ended June 30, 2006

                                 (In thousands)


<TABLE>

                                                                                Accumulated other
                                                                                comprehensive loss
                                             Additional                    -----------------------------           Total
                                Common        paid-in       Retained        Currency          Pension           stockholders'
                                stock         capital        deficit       translation       liabilities           equity
                                ------       ----------     --------       -----------       -----------        -------------
                                                    (unaudited)

<S>                              <C>           <C>              <C>             <C>             <C>               <C>
Balance at December 31, 2005     $  489        $1,061,539       $(441,295)      $(114,930)      $(95,819)         $409,984

Net income                         -                 -             28,601            -              -               28,601

Other comprehensive income         -                 -               -             21,250           -               21,250

Dividends                          -                 -            (24,476)           -              -              (24,476)

Issuance of common stock           -                  105            -               -              -                  105
                                 ------        ----------       ---------       ---------       --------          --------

Balance at June 30, 2006         $  489        $1,061,644       $(437,170)      $ (93,680)      $(95,819)         $435,464
                                 ======        ==========       =========       =========       ========          ========
</TABLE>







                     KRONOS WORLDWIDE, INC. AND SUBSIDIARIES

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                     Six months ended June 30, 2005 and 2006

                                 (In thousands)

<TABLE>

                                                                    2005             2006
                                                                    ----             ----
                                                                         (Unaudited)

 Cash flows from operating activities:
<S>                                                               <C>             <C>
   Net income                                                     $ 54,266        $ 28,601
   Depreciation and amortization                                    22,136          21,741
   Loss on prepayment of debt                                         -             22,311
   Call premium paid                                                  -            (20,898)
   Noncash interest expense                                          1,546           1,141
   Deferred income taxes                                            12,615          (9,199)
   Minority interest                                                     7               5
   Net loss from disposition of property and equipment                 154           1,107
   Distributions from (contributions to) TiO2 manufacturing
    joint venture, net                                                 650            (250)
   Securities transaction gain                                      (5,439)           -
   Benefit plan expense less than cash funding:
     Defined benefit pension plans                                  (2,639)           (303)
     Other postretirement benefits, net                               (437)           (198)
   Other, net                                                       (1,504)           (642)
   Change in assets and liabilities:
     Accounts and other receivables                                (46,936)        (54,888)
     Inventories                                                   (20,596)         17,534
     Prepaid expenses                                               (2,978)         (1,029)
     Accounts payable and accrued liabilities                      (12,054)         (4,987)
     Income taxes                                                    5,683         (20,869)
     Accounts with affiliates                                        2,900             850
     Other, net                                                     (4,969)          1,016
                                                                  --------        --------

         Net cash provided by (used in) operating activities         2,405         (18,957)
                                                                  --------        --------

 Cash flows from investing activities:
   Capital expenditures                                            (11,524)        (13,426)
   Change in restricted cash equivalents                               437             225
   Proceeds from disposal of interest in Norwegian
    smelting operation                                               3,542            -
   Other, net                                                           32              40
                                                                  --------        --------

         Net cash used in investing activities                      (7,513)        (13,161)
                                                                  --------        --------

 Cash flows from financing activities:
   Indebtedness:
     Borrowings                                                       -            649,159
     Principal payments                                            (13,015)       (596,194)
     Deferred financing costs paid                                    -             (8,789)
   Dividends paid                                                  (24,474)        (24,476)
   Other, net                                                          641             105
                                                                  --------        --------

         Net cash provided by (used in) financing activities       (36,848)         19,805
                                                                  --------        --------
</TABLE>





                     KRONOS WORLDWIDE, INC. AND SUBSIDIARIES

           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

                     Six months ended June 30, 2005 and 2006

                                 (In thousands)


<TABLE>

                                                                    2005             2006
                                                                    ----             ----
                                                                         (Unaudited)

 Cash and cash equivalents - net change from:
<S>                                                               <C>             <C>
   Operating, investing and financing activities                  $(41,956)       $(12,313)
   Currency translation                                             (1,189)          1,712
 Cash and cash equivalents at beginning of period                   60,790          72,029
                                                                  --------        --------

 Cash and cash equivalents at end of period                       $ 17,645        $ 61,428
                                                                  ========        ========


 Supplemental disclosures:
   Cash paid for:
     Interest, net of amounts capitalized                         $ 21,360        $ 15,202
     Income taxes, net                                              13,016          28,359

    Noncash investing activity - inventory received
       as partial consideration for disposal of
       interest in Norwegian smelting operation                   $  1,897        $   -
</TABLE>





     See accompanying Notes to Condensed Consolidated Financial Statements.


                     KRONOS WORLDWIDE, INC. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                                  June 30, 2006

                                   (Unaudited)

Note 1 - Organization and basis of presentation:

     Organization - We are a  majority-owned  subsidiary of Valhi,  Inc.  (NYSE:
VHI). At June 30, 2006, Valhi held  approximately 59% of our outstanding  common
stock and NL  Industries,  Inc.  (NYSE:NL)  held an additional 36% of our common
stock.   Valhi  owns   approximately  83%  of  NL's  outstanding  common  stock.
Approximately  92% of  Valhi's  outstanding  common  stock  is held  by  Contran
Corporation and its  subsidiaries.  Substantially  all of Contran's  outstanding
voting stock is held by trusts  established for the benefit of certain  children
and grandchildren of Harold C. Simmons, of which Mr. Simmons is sole trustee, or
is held by Mr.  Simmons  or persons or other  entities  related to Mr.  Simmons.
Consequently, Mr. Simmons may be deemed to control each of these companies.

     Basis of  presentation  - The unaudited  Condensed  Consolidated  Financial
Statements  contained in this  Quarterly  Report have been  prepared on the same
basis as the audited  Consolidated  Financial Statements in our Annual Report on
Form 10-K for the year ended December 31, 2005 that we filed with the Securities
and Exchange Commission ("SEC") on March 16, 2006 (the "2005 Annual Report"). In
our opinion,  we have made all necessary  adjustments (which include only normal
recurring  adjustments) in order to state fairly, in all material respects,  our
consolidated financial position,  results of operations and cash flows as of the
dates and for the periods presented.  We have condensed the Consolidated Balance
Sheet at December 31, 2005 contained in this Quarterly Report as compared to our
audited  Consolidated  Financial  Statements  at that date,  and we have omitted
certain  information and footnote  disclosures  (including  those related to the
Consolidated  Balance Sheet at December 31, 2005) normally included in financial
statements prepared in accordance with accounting  principles generally accepted
in the United  States of America  ("GAAP").  Our results of  operations  for the
interim  periods  ended June 30,  2006 may not be  indicative  of our  operating
results  for the full year.  The  Condensed  Consolidated  Financial  Statements
contained in this Quarterly  Report should be read in conjunction  with our 2005
Consolidated Financial Statements contained in our 2005 Annual Report.

     Unless  otherwise  indicated,  references  in this report to "we",  "us" or
"our" refer to Kronos Worldwide,  Inc. and its subsidiaries (NYSE: KRO) taken as
a whole.

Note 2 - Accounts and other receivables, net:
<TABLE>

                                                                December 31,          June 30,
                                                                    2005                2006
                                                                ------------         ----------
                                                                         (In thousands)

<S>                                                               <C>                 <C>
 Trade receivables                                                $ 170,619           $ 231,229
 Recoverable VAT and other receivables                               15,930              20,676
 Allowance for doubtful accounts                                     (1,965)             (2,313)
                                                                  ---------           ---------

      Total                                                       $ 184,584           $ 249,592
                                                                  =========           =========
</TABLE>




Note 3 - Inventories, net:
<TABLE>

                                                                December 31,          June 30,
                                                                    2005                2006
                                                                ------------         ----------
                                                                         (In thousands)

<S>                                                               <C>                 <C>
 Raw materials                                                    $ 52,343            $  46,769
 Work in process                                                    17,959               16,871
 Finished products                                                 149,900              145,934
 Supplies                                                           39,642               46,361
                                                                  ---------           ---------

      Total                                                       $ 259,844           $ 255,935
                                                                  =========           =========
</TABLE>

Note 4 - Other noncurrent assets:
<TABLE>

                                                                December 31,          June 30,
                                                                    2005                2006
                                                                ------------         ----------
                                                                         (In thousands)

<S>                                                               <C>                 <C>
 Unrecognized net pension obligations                             $  11,916           $  12,534
 Deferred financing costs, net                                        8,150               9,438
 Restricted marketable debt securities                                2,572               2,765
 Other                                                                3,000               1,073
                                                                  ---------           ---------

      Total                                                       $  25,638           $  25,810
                                                                  =========           =========
</TABLE>

Note 5 - Accounts payable and accrued liabilities:

<TABLE>

                                                                December 31,          June 30,
                                                                    2005                2006
                                                                ------------         ----------
                                                                         (In thousands)

<S>                                                               <C>                 <C>
 Accounts payable                                                 $  91,397           $  82,945
 Employee benefits                                                   35,610              30,550
 Interest                                                               191               7,633
 Other                                                               38,347              46,477
                                                                  ---------           ---------

      Total                                                       $ 165,545           $ 167,605
                                                                  =========           =========
</TABLE>

Note 6 - Long-term debt:
<TABLE>

                                                                December 31,          June 30,
                                                                    2005                2006
                                                                ------------         ----------
                                                                         (In thousands)
 Kronos International, Inc.:
<S>                                                               <C>                 <C>
   8.875% Senior Secured Notes                                    $ 449,298           $    -
   6.5% Senior Secured Notes                                           -                499,354
 Revolving credit facilities:
     Kronos U.S. subsidiaries                                        11,500              32,250
     Kronos Canada                                                     -                  4,453
 Other                                                                4,525               4,781
                                                                  ---------           ---------
      Total debt
                                                                    465,323             540,838
 Less current maturities                                                958                 983
                                                                  ---------           ---------

      Total long-term debt                                        $ 464,365           $ 539,855
                                                                  =========           =========
</TABLE>


     Senior  Secured  Notes - On April 11, 2006,  our  wholly-owned  subsidiary,
Kronos  International,  Inc.  ("KII")  issued an  aggregate  of euro 400 million
principal  amount of new 6.5% Senior Secured Notes due April 2013, at 99.306% of
their principal amount ($498.5 million when issued).  These Senior Secured Notes
were issued pursuant to an indenture that contains  covenants,  restrictions and
collateral substantially identical to the covenants, restrictions and collateral
of our 8.875%  Senior  Secured  Notes.  On May 11, 2006,  we redeemed all of our
8.875% Senior  Secured Notes at 104.437% of the  aggregate  principal  amount of
euro 375 million for an aggregate of $491.4 million, including the $20.9 million
call premium.  We used the proceeds from the 6.5% Senior Secured Notes issued in
April  2006 to fund  the  redemption.  We  recognized  a $22.3  million  pre-tax
interest  charge in the second  quarter  related to the prepayment of the 8.875%
Senior  Secured  Notes,  consisting  of the call  premium  on the  notes and the
write-off of deferred  financing  costs and  unamortized  premium related to the
notes.

     Revolving  credit  facilities - For the six months ended June 30, 2006,  we
borrowed an aggregate of Cdn. $5 million ($4.5 million when borrowed)  under our
Canadian  revolving  credit facility and a net $20.8 million under our U.S. bank
credit facility.  The average interest rates on the outstanding borrowings under
these facilities at June 30, 2006 were 6.75% and 8.25%, respectively.

Note 7 - Other noncurrent liabilities:
<TABLE>

                                                                December 31,          June 30,
                                                                    2005                2006
                                                                ------------         ----------
                                                                         (In thousands)

<S>                                                               <C>                 <C>
 Employee benefits                                                $   4,735           $   6,197
 Insurance claims and expenses                                        1,733               1,069
 Asset retirement obligations                                           934               1,033
 Other                                                                8,653               9,011
                                                                  ---------           ---------

      Total                                                       $  16,055           $  17,310
                                                                  =========           =========
</TABLE>

Note 8 - Employee benefit plans:

     Defined  benefit  plans - The  components of net periodic  defined  benefit
pension cost are presented in the table below.
<TABLE>

                                                Three months ended              Six months ended
                                                      June 30,                      June 30,
                                                -------------------            -------------------
                                                2005           2006            2005           2006
                                                ----           ----            ----           ----
                                                   (In thousands)                 (In thousands)

<S>                                           <C>            <C>             <C>            <C>
 Service cost                                 $ 1,914        $ 1,991         $ 3,901        $ 3,835
 Interest cost                                  4,454          4,747           9,034          9,320
 Expected return on plan assets                (4,004)        (4,027)         (8,118)        (7,918)
 Amortization of prior service cost               150            114             304            226
 Amortization of net transition obligations       153            144             310            283
 Recognized actuarial losses                      927          2,157           1,878          4,230
                                              -------        -------         -------        -------

      Total                                   $ 3,594        $ 5,126         $ 7,309        $ 9,976
                                              =======        =======         =======        =======
</TABLE>




     Postretirement  benefits - The  components  of net periodic  postretirement
benefit costs are presented in the table below.
<TABLE>

                                                Three months ended              Six months ended
                                                      June 30,                      June 30,
                                                -------------------            -------------------
                                                2005           2006            2005           2006
                                                ----           ----            ----           ----
                                                   (In thousands)                 (In thousands)

<S>                                             <C>           <C>              <C>            <C>
 Service cost                                   $ 54          $ 71             $109           $142
 Interest cost                                   144           157              289            313
 Amortization of prior service credit           (160)          (50)            (320)          (100)
 Recognized actuarial losses                      17            29               35             57
                                                ----          ----             ----           ----

      Total                                     $ 55          $207             $113           $412
                                                ====          ====             ====           ====
</TABLE>

     Contributions.  We expect our 2006  contributions  for our pension and post
retirement  benefit plans to be  consistent  with the amount we disclosed in our
2005 Annual Report.

Note 9 - Accounts with affiliates:
<TABLE>

                                                                December 31,          June 30,
                                                                    2005                2006
                                                                ------------         ----------
                                                                         (In thousands)

 Current receivables from affiliates:
<S>                                                               <C>                 <C>
   Income taxes receivable from Valhi                             $   -               $     233
   Other                                                                  2                -
                                                                  ---------           ---------

      Total                                                       $       2           $     233
                                                                  =========           =========

 Current payable to affiliates:
   Louisiana Pigment Company, L.P.                                $   9,803           $   9,791
   Income taxes payable to Valhi                                        434                -
   NL                                                                   145                  98
                                                                  ---------           ---------

      Total                                                       $  10,382           $   9,889
                                                                  =========           =========
</TABLE>

Note 10 - Commitments and contingencies:

     We  and  our  affiliates  are  also  involved  in  various   environmental,
contractual,  product liability,  patent (or intellectual property),  employment
and other claims and disputes  incidental to our present and former  operations.
In certain  cases,  we have  insurance  coverage for these  items.  We currently
believe  the  disposition  of all claims and  disputes,  individually  or in the
aggregate,  should  not  have a  material  adverse  effect  on our  consolidated
financial position, results of operations or liquidity.

     Please refer to our 2005 Annual  Report for a discussion  of certain  other
legal proceedings to which we are a party.




Note 11 - Provision for income taxes (benefit):
<TABLE>

                                                                       Six months ended
                                                                           June 30,
                                                                  -------------------------
                                                                   2005               2006
                                                                   ----               ----
                                                                         (In millions)

<S>                                                                <C>               <C>
 Expected tax expense                                              $30.5             $ 9.4
 Incremental U.S. tax and rate differences on
  equity in earnings of non-tax group companies                       .2                .4
 Non-U.S. tax rates                                                  (.1)              (.7)
 Nondeductible expenses                                              1.8               1.4
 Resolution of prior year income tax issues, net                      -               (2.0)
 U.S. state income tax expense, net                                   .2                .4
 Contingency reserve adjustment, net                                  .2              (9.5)
 Canadian tax rate change                                             -               (1.1)
                                                                   -----             -----

      Total                                                        $32.8             $(1.7)
                                                                   =====             =====
</TABLE>

     In June 2006,  Canada enacted a 2% reduction in the Canadian federal income
tax rate and the  elimination  of the federal  surtax.  The 2% reduction will be
phased in from 2008 to 2010,  and the federal surtax will be eliminated in 2008.
As a result,  during the second  quarter of 2006 we  recognized  a $1.1  million
income tax benefit  related to the effect of such  reduction  of our  previously
recorded net deferred income tax liability.

     Due to the favorable resolution of certain income tax issues related to our
German and Belgian operations during the first six months of 2006, we recognized
a $2  million  income tax  benefit  ($1  million in the second  quarter of 2006)
related to adjustments of prior year income taxes.

     Tax authorities are examining certain of our non-U.S.  tax returns and have
or may propose tax deficiencies, including penalties and interest. For example:

     o    We previously  received a preliminary  tax assessment  related to 1993
          from the Belgian tax authorities proposing tax deficiencies, including
          related  interest,  of  approximately  euro 6 million ($7.2 million at
          June 30, 2006). The Belgian tax authorities  filed a lien on the fixed
          assets  of our  Belgian  TiO2  operations  in  connection  with  their
          assessment.  This lien does not interfere with on-going  operations at
          the facility. We filed a protest to this assessment,  and in July 2006
          the Belgian tax authorities  withdrew the  assessment.  We believe the
          lien will be released by the end of 2006.

     o    The Norwegian tax authorities  previously  notified us of their intent
          to assess tax  deficiencies of  approximately  kroner 12 million ($2.4
          million at June 30, 2006)  relating to the years 1998 through 2000. We
          objected to this  proposed  assessment,  and in May 2006 the Norwegian
          tax authorities withdrew the assessment.

     Principally  as a result of the  withdrawal  of the Belgian  and  Norwegian
assessments  discussed  above,  we have  recognized  a $9.5  million  income tax
benefit in the first six months of 2006 (mostly in the second  quarter)  related
to the  reduction  in our  income  tax  contingency  reserve.  Other  income tax
examinations  related to our operations  continue,  and we cannot guarantee that
these  tax  matters   will  be  resolved  in  our  favor  due  to  the  inherent
uncertainties  involved in settlement initiatives and court and tax proceedings.
We believe we have adequate  accruals for additional  taxes and related interest
expense  which could  ultimately  result from tax  examinations.  We believe the
ultimate  disposition  of tax  examinations  should not have a material  adverse
effect  on  our  consolidated  financial  position,  results  of  operations  or
liquidity.

Note 12 - Recent accounting pronouncements:

     Inventory costs - Statement of Financial  Accounting Standards ("SFAS") No.
151,  Inventory  Costs, an amendment of ARB No. 43, Chapter 4, became  effective
for us for inventory  costs  incurred on or after January 1, 2006.  SFAS No. 151
requires that the allocation of fixed production  overhead costs to inventory be
based on normal  capacity of the production  facilities,  as defined by SFAS No.
151. SFAS No. 151 also  clarifies the  accounting  for abnormal  amounts of idle
facility  expense,  freight handling costs and wasted material,  requiring those
items be recognized as  current-period  charges.  Our existing  production  cost
policies complied with the requirements of SFAS No. 151,  therefore the adoption
of SFAS No. 151 did not affect our Consolidated Financial Statements.

     Stock  options - We adopted  the fair value  provisions  of SFAS No.  123R,
"Share-Based  Payment,"  on  January  1, 2006,  using the  modified  prospective
application  method.  SFAS No. 123R,  among other  things,  requires the cost of
employee  compensation paid with equity  instruments to be measured based on the
grant-date  fair value.  That cost is then  recognized  over the vesting period.
Using the  modified  prospective  method,  we will apply the  provisions  of the
standard to all new equity  compensation  granted  after January 1, 2006 and any
existing  awards  vesting  after  January 1, 2006.  We have not issued any stock
options to purchase Kronos common stock. However,  certain of our employees have
been granted options by NL to purchase NL common stock. The number of non-vested
equity awards issued by NL as of December 31, 2005 is not material. Prior to the
adoption of SFAS No. 123R we accounted  for equity  compensation  in  accordance
with APBO No. 25,  Accounting  for Stock Issued to  Employees.  Our affiliate NL
accounted for their equity awards under the variable  accounting  method whereby
the equity  awards  were  revalued  based on the current  trading  price at each
balance sheet date.  We now account for these awards using the liability  method
under SFAS No. 123R, which is substantially identical to the variable accounting
method we  previously  used.  We  recorded no  material  income or  compensation
expense  in  the  quarter   ended  June  30,  2006  for   stock-based   employee
compensation.  We  recorded  income for  stock-based  employee  compensation  of
approximately  $1 million in the quarter  ended June 30, 2005 and  $900,000  and
$400,000  in the six months  ended June 30, 2005 and 2006,  respectively.  If we
grant a  significant  number of equity  awards or modify,  repurchase  or cancel
existing equity awards in the future, the amount of equity compensation  expense
in our Consolidated Financial Statements could be material.

     Effective  January 1, 2006,  SFAS No.  123R  requires  the cash  income tax
benefit resulting from the exercise of stock options in excess of the cumulative
income tax benefit previously  recognized for GAAP financial  reporting purposes
to be reflected as a component of cash flows from  financing  activities  in our
Consolidated  Financial  Statements.  Because  we account  for these  options to
purchase NL common stock under the liability  method of SFAS No. 123R,  the cash
income tax benefit resulting from the exercise of such stock options will always
be  equal  to the  cumulative  income  tax  benefit  we  would  have  previously
recognized for GAAP financial  reporting  purposes.  SFAS No. 123R also requires
certain  expanded  disclosures  regarding equity  compensation,  and we provided
these expanded disclosures in our 2005 Annual Report.

     Uncertain  tax  positions  - In the second  quarter  of 2006 the  Financial
Accounting  Standards Board ("FASB") issued FASB  Interpretation No. ("FIN") 48,
Accounting  for Uncertain Tax Positions,  which will become  effective for us on
January  1,  2007.  FIN No. 48  clarifies  when and how much of a benefit we can
recognize in our Consolidated  Financial  Statements for certain positions taken
in our income tax returns under SFAS No. 109,  Accounting for Income Taxes,  and
enhances the disclosure  requirements  for our income tax policies and reserves.
Among other things, FIN No. 48 will prohibit us from recognizing the benefits of
a tax position  unless we believe it is  more-likely-than-not  our position will
prevail with the applicable tax authorities and limits the amount of the benefit
to the largest  amount for which we believe the  likelihood  of  realization  is
greater than 50%. FIN No. 48 also  requires  companies to accrue  penalties  and
interest on the difference  between tax positions taken on their tax returns and
the amount of benefit recognized for financial  reporting purposes under the new
standard.  Our current income tax accounting policies comply with this aspect of
the new standard.  We will also be required to  reclassify  any reserves we have
for uncertain tax positions from deferred income tax liabilities, where they are
currently recognized,  to a separate current or noncurrent liability,  depending
on the nature of the tax position. We are currently evaluating the impact of FIN
No. 48 on our Consolidated Financial Statements.



ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
--------------------------------------------------------------------------------

RESULTS OF OPERATIONS:

Business and results of operations overview

     We are a leading  global  producer  and  marketer of  value-added  titanium
dioxide  pigments  ("TiO2").  TiO2  is  used  for  a  variety  of  manufacturing
applications,  including plastics,  paints, paper and other industrial products.
For the six months  ended June 30,  2006,  approximately  one-half  of our sales
volumes  were  attributable  to markets in Europe.  We believe we are the second
largest  producer of TiO2 in Europe with an estimated 20% share of European TiO2
sales  volumes.  In  addition,  we also  have an  estimated  15%  share of North
American TiO2 sales volumes.  Our production  facilities are located  throughout
Europe and North America.

     We reported net income of $13.6 million,  or $.28 per diluted share, in the
second quarter of 2006 as compared to net income of $32.9  million,  or $.67 per
diluted share,  in the second quarter of 2005. For the first six months of 2006,
we reported net income of $28.6 million, or $.58 per diluted share,  compared to
net income of $54.3 million, or $1.11 per diluted share, in the first six months
of 2005.  Our diluted  earnings per share  declined from the 2005 periods to the
2006  periods  primarily  due to the  unfavorable  effect of lower  income  from
operations in 2006, a gain from the sale of our passive  interest in a Norwegian
smelting  operation  in 2005 and a charge in the  second  quarter  2006 from the
redemption  of our 8.875%  Senior  Secured  Notes more than offset the favorable
effect of certain income tax benefits recognized in 2006.

     Our net  income in the first six months of 2005  includes a second  quarter
gain from the sale of our passive interest in a Norwegian  smelting operation of
$.07 per diluted share.  Our net income in the first six months of 2006 includes
(1) a charge  related to the  prepayment of our 8.875%  Senior  Secured Notes of
$.30 per  diluted  share and (2) an  aggregate  income  tax  benefit of $.26 per
diluted share ($.24 per diluted share for the second quarter of 2006) related to
the withdrawal of certain income tax assessments  previously made by the Belgian
and Norwegian tax  authorities,  the favorable  resolution of certain income tax
issues  related to our German and  Belgian  operations  and the  enactment  of a
reduction in the Canadian federal income tax rate.

Forward-looking information

     This report contains  forward-looking  statements within the meaning of the
Private Securities  Litigation Reform Act of 1995.  Statements in this Quarterly
Report on Form 10-Q that are not  historical  in nature are  forward-looking  in
nature about our future that are not statements of historical  fact.  Statements
in this  report  including,  but not limited  to,  statements  found in Item 2 -
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations,"  are  forward-looking  statements  that  represent  our beliefs and
assumptions  based on  currently  available  information.  In some cases you can
identify  these  forward-looking   statements  by  the  use  of  words  such  as
"believes,"  "intends," "may," "should," "could,"  "anticipates,"  "expected" or
comparable  terminology,  or by discussions of strategies or trends. Although we
believe the expectations reflected in forward-looking statements are reasonable,
we do not know if these expectations will be correct. Forward-looking statements
by  their  nature  involve   substantial  risks  and  uncertainties  that  could
significantly  impact  expected  results.  Actual  future  results  could differ
materially  from those  predicted.  While it is not  possible  to  identify  all
factors,  we  continue to face many risks and  uncertainties.  Among the factors
that could  cause our actual  future  results  to differ  materially  from those
described  herein are the risks and  uncertainties  discussed in this  Quarterly
Report and those  described  from time to time in our other filings with the SEC
including, but not limited to, the following:

     o    Future supply and demand for our products,
     o    The extent of our dependence on certain market sectors,
     o    The cyclicality of our businesses,
     o    Customer  inventory  levels (such as the extent to which our customers
          may,  from time to time,  accelerate  purchases  of TiO2 in advance of
          anticipated  price  increases or defer purchases of TiO2 in advance of
          anticipated price decreases),
     o    Changes in raw  material  and other  operating  costs  (such as energy
          costs),
     o    The possibility of labor disruptions,
     o    General 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 TiO2),
     o    Competitive products and substitute products,
     o    Customer and competitor strategies,
     o    The impact of pricing and production decisions,
     o    Competitive technology positions,
     o    The introduction of trade barriers,
     o    Fluctuations  in  currency  exchange  rates  (such as  changes  in the
          exchange  rate  between  the U.S.  dollar  and each of the  euro,  the
          Norwegian kroner and the Canadian dollar),
     o    Operating  interruptions   (including,   but  not  limited  to,  labor
          disputes, leaks, natural disasters, fires, explosions,  unscheduled or
          unplanned downtime and transportation interruptions),
     o    The timing and amounts of insurance recoveries,
     o    Our ability to renew or refinance credit facilities,
     o    The ultimate outcome of income tax audits, tax settlement  initiatives
          or other tax matters,
     o    The ultimate ability to utilize income tax attributes,  the benefit of
          which has been recognized under the "more likely than not" recognition
          criteria,
     o    Environmental  matters (such as those requiring emission and discharge
          standards for existing and new facilities),
     o    Government laws and regulations and possible changes therein,
     o    The ultimate resolution of pending litigation, and
     o    Possible 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  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.

Results of operations

     We consider TiO2 to be a "quality of life" product, with demand affected by
gross  domestic  product  (or "GDP") in various  regions of the world.  Over the
long-term,  we  expect  that  demand  for TiO2  will  grow by 2% to 3% per year,
consistent with our expectations for the long-term growth in GDP. However,  even
if we and our competitors  maintain  consistent  shares of the worldwide market,
demand  for TiO2 in any  interim  or annual  period  may not  change in the same
proportion  as the change in GDP,  in part due to  relative  changes in the TiO2
inventory  levels of our  customers.  We believe that our  customers'  inventory
levels are partly  influenced by their  expectation for future changes in market
TiO2 selling prices.

     The factors having the most impact on our reported operating results are:

     o    Our TiO2 average selling prices,

     o    Foreign currency  exchange rates  (particularly  the exchange rate for
          the U.S. dollar relative to the euro and the Canadian dollar),

     o    Our TiO2 sales and production volumes, and

     o    Manufacturing  costs,   particularly  maintenance  and  energy-related
          expenses.

     Our key performance indicators are our TiO2 average selling prices, and our
level of TiO2 sales and production volumes.

Quarter ended June 30, 2005 compared to the
quarter ended June 30, 2006 -

<TABLE>

                                                                     Three months ended
                                                                          June 30,
                                                        -------------------------------------------
                                                               2005                      2006
                                                        -----------------        ------------------
                                                                   (Dollars in millions)

<S>                                                     <C>          <C>         <C>           <C>
 Net sales                                              $311.7       100%        $345.1        100%
 Cost of sales                                           217.1        70%         263.1         76%
                                                        ------       ----        ------        ----
   Gross margin                                           94.6        30%          82.0         24%
 Other operating income and costs, net                    36.9        12%          45.2         13%
                                                        ------       ----        ------        ----
   Income from operations                               $ 57.7        18%        $ 36.8         11%
                                                        ======       ====        ======        ====

                                                                                                 %
                                                                                              Change
 Ti02 operating statistics:
   Sales volumes*                                          122                      139        +14%
   Production volumes*                                     127                      130         +2%

   Percent change in net sales:
     TiO2 product pricing                                                                       -1%
     TiO2 sales volumes                                                                        +14%
     TiO2 product mix                                                                           -1%
     Changes in currency exchange rates                                                         -1%
                                                                                               ----

     Total                                                                                     +11%
                                                                                               ====
</TABLE>

      * Thousands of metric tons

     Net sales - Net sales increased 11% or $33.4 million compared to the second
quarter of 2005  primarily  due to a 14%  increase  in TiO2 sales  volumes.  The
benefit of higher sales volumes was offset  somewhat by a 1% decrease in average
TiO2 selling prices and the impact of currency  exchange  rates. We estimate the
unfavorable effect of changes in currency exchange rates decreased our net sales
by  approximately  $4 million,  or 1%,  compared to the same period in 2005.  We
expect  selling  prices to remain  reasonably  stable in the second half of 2006
compared to the second quarter of 2006.

     Our 14% increase in sales volume in the second quarter of 2006 is primarily
due to higher sales  volumes in the United  States,  Europe and export  markets,
which were somewhat  offset by lower sales  volumes in Canada.  We believe sales
volumes in Canada have decreased as our  customers'  demand has been affected by
the effects of the strengthened  Canadian dollar.  We expect overall demand will
continue to remain high for the remainder of the year.

     Cost of sales - Cost of sales  increased $46.1 million or 21% in the second
quarter of 2006 compared to 2005 primarily due to the impact of increased  sales
volumes and higher operating costs (including  energy costs).  The cost of sales
as a  percentage  of net sales  increased  to 76% in the second  quarter of 2006
compared to 70% in the second  quarter of 2005 primarily due to increases in raw
material and other operating costs (including energy costs).

     The negative  impact of the increase in raw  materials and energy costs was
somewhat offset by record production  levels.  TiO2 production volumes increased
2% in the second  quarter of 2006  compared  to the same  period in 2005,  which
favorably  impacted  our  operating  income  comparisons.  We  continued to gain
operational  efficiencies  at our existing TiO2  facilities  by  debottlenecking
production to meet long-term demand. Our operating rates were near full capacity
in both periods, and we set a new production volume record in the second quarter
of 2006.

     Through our  debottlenecking  program,  we added finishing  capacity in the
German chloride-process facility and also equipment upgrades and enhancements in
several locations have allowed us to reduce downtime for maintenance activities.
Our  production  capacity has increased by  approximately  30% over the past ten
years with only moderate capital expenditures.  We believe our annual attainable
TiO2  production  capacity for 2006 is  approximately  510,000 metric tons, with
some additional  capacity expected to be available in 2007 through our continued
debottlenecking efforts.

     Income from  operations - Income from  operations for the second quarter of
2006 declined by 36% to $36.8 million compared to the same period in 2005 and as
a percentage of net sales,  income from operations declined to 11% in the second
quarter of 2006 from 18% in the same period for 2005. This decrease is driven by
the decline in gross margin,  which fell to 24% in 2006 compared to 30% in 2005.
Our gross margin decrease is due to lower selling prices for TiO2, the increases
we  experienced  in raw  materials  and  energy  costs in  2006,  as well as the
negative effect of changes in currency  exchange rates,  partially offset by the
higher sales and production  volumes. We estimate the negative effect of changes
in  foreign  currency   exchange  rates  decreased  income  from  operations  by
approximately $11 million.  We expect income from operations for the second half
of 2006 will continue to be lower than the second half of 2005.

     Other  non-operating  income  (expense) - In April 2006, we issued our euro
400 million principal amount of 6.5% Senior Secured Notes, and used the proceeds
to redeem our euro 375 million  principal amount of 8.875% Senior Secured Notes.
As a result of our prepayment of the 8.875% Senior Secured Notes,  we recognized
a $22.3  million  pre-tax  interest  charge  ($14.8  million  net of income  tax
benefit)  in the  second  quarter  of 2006  for  the  prepayment  of the  notes,
representing  (1) the call premium on the notes,  (2) the  write-off of deferred
financing  costs and (3) write off of the  existing  unamortized  premium on the
notes. See Note 6 to the Condensed  Consolidated  Financial  Statements.  Annual
interest expense on the 6.5% Senior Secured Notes will be  approximately  euro 6
million less than on the 8.875% Senior Secured Notes.

     Interest  expense  increased  $1.5 million from $11.6 million in the second
quarter of 2005 to $13.1 million in the second  quarter of 2006 due primarily to
the 8.875%  Senior  Secured  Notes and the 6.5% Senior  Secured Notes both being
outstanding for 30 days during the quarter. This additional interest expense was
partially offset by changes in currency exchange rates in 2006 compared to 2005.
Excluding the effect of currency exchange rates, we expect interest expense will
be lower in second half of 2006 as compared to the first half of 2006.

     We have a  significant  amount  of  indebtedness  denominated  in the euro,
primarily the Senior Secured Notes.  The interest expense we recognize will vary
with fluctuations in the euro exchange rate.

     Provision  for income  taxes  (benefit)  - An income  tax  benefit of $10.9
million  was  recorded in the second  quarter of 2006  compared to an expense of
$19.1  million in the same period  last year.  The income tax benefit in 2006 is
primarily due to a $9.5 million reduction in our income tax contingency reserves
related to  favorable  developments  with  income tax audits for our Belgian and
Norwegian   operations,   a  $1  million   benefit   associated  with  favorable
developments  with certain income tax issues  related to our Belgian  operations
and a $1.1  million  benefit  resulting  from the  enactment  of a reduction  in
Canadian income tax rates. See Note 11 to the Condensed  Consolidated  Financial
Statements.

Six months ended June 30, 2005 compared to the
six months ended June 30, 2006 -

<TABLE>

                                                                     Three months ended
                                                                          June 30,
                                                        -------------------------------------------
                                                               2005                      2006
                                                        -----------------        ------------------
                                                                   (Dollars in millions)

<S>                                                     <C>          <C>         <C>           <C>
 Net sales                                              $603.5       100%        $649.4        100%
 Cost of sales                                           424.7        70%         492.6         76%
                                                        ------       ----        ------        ----
   Gross margin                                          178.8        30%         156.8         24%
 Other operating income and costs, net                    74.7        12%          85.7         13%
                                                        ------       ----        ------        ----
   Income from operations                               $104.1        18%        $ 71.1         11%
                                                        ======       ====        ======        ====

                                                                                                 %
                                                                                              Change
 Ti02 operating statistics:
   Sales volumes*                                          237                      264        +11%
   Production volumes*                                     249                      257         +3%

   Percent change in net sales:
     TiO2 product pricing                                                                       +1%
     TiO2 sales volumes                                                                        +11%
     TiO2 product mix                                                                           -1%
     Changes in currency exchange rates                                                         -3%
                                                                                               ----

     Total                                                                                      +8%
                                                                                               ====
</TABLE>

      * Thousands of metric tons

     Net sales - Net sales  increased  8% or $45.9  million  compared to the six
months  ended June 30,  2005,  primarily  due to an 11%  increase  in TiO2 sales
volumes,  offset somewhat by the impact of currency  exchange rates. We estimate
the unfavorable  effect of changes in currency  exchange rates decreased our net
sales by approximately $19 million, or 3%, compared to the same period in 2005.

     Our 11%  increase in sales  volume in the six months ended June 30, 2006 is
primarily due to higher sales volumes in the United States, Europe and in export
markets, which were somewhat offset by lower sales volumes in Canada.

     Cost of sales - Cost of sales  increased  $67.9  million  or 16% in the six
months ended June 30, 2006,  compared to the same period in 2005,  primarily due
to the impact of increased sales volumes and higher  operating costs  (including
energy costs). The cost of sales percentage of net sales increased to 76% in the
six  months  ended June 30,  2006,  compared  to 70% in the same  period of 2005
primarily  due to increases in higher raw  material  and other  operating  costs
(including energy costs).

     The negative  impact of the increase in raw  materials and energy costs was
somewhat offset by record production  levels.  TiO2 production volumes increased
3% in the six months  ended June 30,  2006  compared to the same period in 2005,
which favorably impacted our income from operations  comparisons.  Our operating
rates were near full  capacity in both periods.  Production  volume was a record
aided by our continuing debottlenecking.

     Income from  operations - Income from  operations  for the six months ended
June 30, 2006  declined by 32% to $71.1  million  compared to the same period in
2005; the income from operations as a percentage of net sales declined to 11% in
the six months  ended June 30,  2006 from 18% in the same  period for 2005.  The
decline in income  from  operations  is driven by the  decline in gross  margin,
which  fell  to 24% in  2006  compared  to 30% in  2005,  due  primarily  to the
increases we  experienced  in raw materials and energy costs in 2006, as well as
the negative effect of changes in currency  exchange rates,  partially offset by
the higher sales and  production  volumes.  We estimate  the negative  effect of
changes in foreign  currency  exchange rates decreased income from operations by
approximately $16 million.

     Other non-operating  income (expense) - Interest expense increased $400,000
from $23.4 million in the six months ended June 30, 2005 to $23.8 million in the
six months ended June 30, 2006  primarily due to the 8.875% Senior Secured Notes
and the 6.5% Senior Secured Notes both being  outstanding for 30 days during the
six months ended June 30, 2006. This additional  interest  expense was partially
offset by changes in currency exchange rates in 2006 compared to 2005.

     Provision  for  income  taxes  (benefit)  - An income  tax  benefit of $1.7
million was  recorded in the first six months of 2006  compared to an income tax
expense of $32.8 million in the same period last year. The income tax benefit in
2006 is primarily due to a $9.5 million  reduction in our income tax contingency
reserves  related  to  favorable  developments  with  income  tax audits for our
Belgian and Norwegian operations, a $2 million benefit associated with favorable
developments  with certain  income tax issues  related to our Belgian and German
operations  and a  $1.1  million  benefit  resulting  from  the  enactment  of a
reduction  in  Canadian  income  tax  rates.  Our tax rate  varies as the mix of
earnings  contributed by our various  subsidiaries  changes.  See Note 11 to the
Condensed  Consolidated Financial Statements for a tabular reconciliation of our
statutory tax expense to our actual tax benefit.

Currency exchange

     We have substantial operations and assets located outside the United States
(primarily in Germany,  Belgium, Norway and Canada). The majority of our foreign
operations'  sales are  denominated in foreign  currencies,  primarily the euro,
other major European  currencies and the Canadian dollar. A portion of our sales
generated  from our  foreign  operations  are  denominated  in the U.S.  dollar.
Certain raw materials used worldwide, primarily titanium-containing  feedstocks,
are  purchased  in U.S.  dollars,  while  labor and other  production  costs are
purchased primarily in local currencies. As a result, the translated U.S. dollar
value of our  foreign  sales and  operating  results  are  subject  to  currency
exchange  rate  fluctuations  which may favorably or adversely  impact  reported
earnings and may affect the comparability of period-to-period operating results.
Overall,  fluctuations  in foreign  currency  exchange  rates had the  following
effects on our sales and income from operations in 2006 as compared to 2005.
<TABLE>

                                                Three months ended            Six months ended
                                                  June 30, 2006                 June 30, 2006
                                                     vs. 2005                     vs. 2005
                                                ------------------            ----------------
                                                        Increase (decrease), in millions
                                                ----------------------------------------------
Impact on:
<S>                                                   <C>                          <C>
  Net sales                                           $  (4)                       $(19)
  Income from operations                                (11)                        (16)
</TABLE>

Outlook

     We expect income from  operations for the second half of 2006 will be lower
than the  second  half of 2005.  Our  expectations  as to the future of the TiO2
industry  are based  upon a number of  factors  beyond  our  control,  including
worldwide  growth of gross domestic  product,  competition  in the  marketplace,
unexpected  or  earlier  than  expected  capacity  additions  and  technological
advances.  If actual developments  differ from our expectations,  our results of
operations could be unfavorably affected.

Other

     On September 22, 2005, the  chloride-process  TiO2 facility operated by our
50%-owned joint venture,  Louisiana Pigment Company ("LPC"),  temporarily halted
production  due to Hurricane  Rita.  Although  there was minimal storm damage to
core processing facilities,  a variety of factors,  including loss of utilities,
limited access and  availability  of employees and raw materials,  prevented the
resumption of partial operations until October 9, 2005 and full operations until
late 2005. LPC expects the majority of its property damage and unabsorbed  fixed
costs for periods in which normal  production  levels were not achieved  will be
covered by  insurance,  and we  believe  insurance  will cover our lost  profits
(subject to  applicable  deductibles)  resulting  from the loss of production at
LPC. Both we and LPC have filed claims with our  insurers.  We expect to recover
our losses  through the insurer in the second half of 2006,  although the amount
and timing of the  insurance  recovery  is not yet known.  We have not accrued a
receivable  for the amount of the insurance  claim and will not record the claim
until negotiations with LPC's insurer are finalized. The effect on our financial
results will depend on the timing and amount of insurance recoveries.

LIQUIDITY AND CAPITAL RESOURCES

Consolidated cash flows

Operating activities

     Trends in cash flows as a result of our operating activities (excluding the
impact of  significant  asset  dispositions  and relative  changes in assets and
liabilities) are generally similar to trends in our earnings.

     Our cash flows from operating activities provided $2.4 million in the first
six  months of 2005,  compared  to $19  million  used in the first six months of
2006. This decrease was due primarily to the net effects of the following items:
     o    Lower income from operations in 2006 of $33 million;
     o    Payment of the $20.9  million call premium as a result of the May 2006
          prepayment of our 8.875% Senior Secured Notes,  which GAAP requires to
          be  included  in  the  determination  of  cash  flows  from  operating
          activities.
     o    Higher cash paid for income taxes in 2006 of $15.3 million;
     o    Lower cash paid for interest in 2006 of $6.2  million,  primarily as a
          result of the May 2006  redemption of our 8.875% Senior  Secured Notes
          (which paid interest  semiannually in June and December) and the April
          2006  issuance  of our  6.5%  Senior  Secured  Notes  (which  will pay
          interest semiannually in April and October); and
     o    A  lower  amount  of  net  cash  used  from  relative  changes  in our
          inventories,  receivables,  payables and accruals of $29.7  million in
          the first six  months of 2006 as  compared  to the first six months of
          2005.

     Changes in  working  capital  were  affected  by  accounts  receivable  and
inventory changes.  Our average days sales outstanding ("DSO") increased from 55
days at  December  31,  2005 to 65 days at June 30,  2006 due to the  timing  of
collection  on  higher  accounts  receivable  balances  at the end of June.  For
comparative  purposes,  our average DSO  increased  from 60 days at December 31,
2004 to 64 days at June 30, 2005.  Our average  days sales in inventory  ("DSI")
decreased from 102 days at December 31, 2005 to 88 days at June 30, 2006, as our
strong TiO2 sales  volumes in the first six months of 2006  exceeded  our strong
TiO2  production  volumes during the period by  approximately  7 thousand metric
tons. For comparative purposes, our TiO2 production volumes were higher than our
TiO2 sales volumes in the first six months of 2005, and our average DSI remained
constant at 97 days at December 31, 2004 and at June 30, 2005.

Investing activities

     Capital expenditures were $11.5 million and $13.4 million in the six months
ended June 30, 2005 and 2006,  respectively.  Capital expenditures are primarily
for improvements and upgrades to existing facilities.

Financing activities

     In the second  quarter of 2006 we redeemed  our euro 375 million  principal
amount of 8.875% Senior Secured Notes ($470.5  million when redeemed) and issued
euro 400  million  principal  amount of 6.5%  Senior  Secured  Notes at  99.306%
($498.5 million when issued). See Note 6 to the Condensed Consolidated Financial
Statements.  During the six months ended June 30, 2006, we had net borrowings of
$20.8 million under our placecountry-regionU.S. credit facility and $4.5 million
under our Canadian credit facility.

     In each of the six months ended June 30, 2005 and 2006, we paid a quarterly
dividend  to  stockholders  of $.25 per share for an  aggregate  dividend  $24.5
million in each six-month period.

Outstanding debt obligations

     At June 30, 2006, our consolidated debt was comprised of:

     o    euro 400 million  principal  amount of our 6.5% Senior  Secured  Notes
          ($499.4 million at June 30, 2006) due in 2013;
     o    $32.3 million under our U.S.  revolving  credit facility which matures
          in September 2008;
     o    Cdn. 5 million  ($4.5  million at June 30,  2006)  under our  Canadian
          revolving credit facility which matures in January 2009; and
     o    Approximately $4.8 million of other indebtedness.

     Certain of our credit agreements  contain  provisions which could result in
the acceleration of indebtedness  prior to its stated maturity for reasons other
than  defaults  for  failure to comply with  certain  financial  covenants.  For
example,  certain credit  agreements allow the lender to accelerate the maturity
of the  indebtedness  upon a change of control (as defined in the  agreement) of
the  borrower.  In  addition,  certain  credit  agreements  could  result in the
acceleration of all or a portion of the indebtedness  following a sale of assets
outside the ordinary  course of business.  We are in compliance  with all of our
debt  covenants  at June  30,  2006.  See Note 6 to the  Condensed  Consolidated
Financial Statements.

     Our assets consist primarily of investments in operating subsidiaries,  and
our ability to service  parent level  obligations,  including the Senior Secured
Notes,  depends  in  large  part  upon  the  distribution  of  earnings  of  our
subsidiaries,  whether in the form of dividends, advances or payments on account
of  intercompany  obligation  or  otherwise.   None  of  our  subsidiaries  have
guaranteed the Senior Secured Notes,  although KII has pledged 65% of the common
stock or other  ownership  interests  of certain of KII's  first-tier  operating
subsidiaries as collateral of the Senior Secured Notes.

Future cash requirements

Liquidity

     Our  primary  source of  liquidity  on an ongoing  basis is cash flows from
operating activities. From time-to-time we will incur indebtedness, generally to
(i) fund short-term working capital needs, (ii) refinance existing  indebtedness
or (iii) fund major  capital  expenditures  or the  acquisition  of other assets
outside the ordinary  course of business.  We will also from  time-to-time  sell
assets  outside  the  ordinary  course of  business,  the  proceeds of which are
generally  used to (i) repay  existing  indebtedness,  (ii) make  investments in
marketable and other  securities,  (iii) fund major capital  expenditures or the
acquisition of other assets outside the ordinary  course of business or (iv) pay
dividends.

     Pricing  within the TiO2  industry  is  cyclical,  and  changes in industry
economic  conditions  significantly  impact  earnings and operating  cash flows.
Changes in TiO2 pricing,  production  volumes and customer  demand,  among other
things, could significantly affect our liquidity.

     We periodically  evaluate our liquidity  requirements,  alternative uses of
capital,  capital  needs and  availability  of resources in view of, among other
things,  our  dividend  policy,   our  debt  service  and  capital   expenditure
requirements  and estimated  future  operating  cash flows.  As a result of this
process,  we have in the past and may in the future  seek to reduce,  refinance,
repurchase or restructure  indebtedness,  raise additional  capital,  repurchase
shares of our common stock,  modify our dividend policy,  restructure  ownership
interests,  sell  interests  in our  subsidiaries  or  other  assets,  or take a
combination  of these steps or other steps to manage our  liquidity  and capital
resources.  Such  activities  have in the  past  and may in the  future  involve
related companies.

     At June 30, 2006,  unused credit available under all of our existing credit
facilities was  approximately  $118 million.  Based upon our expectation for the
TiO2  industry  and  anticipated  demands on cash  resources,  we expect to have
sufficient  liquidity  to meet  our  future  obligations  including  operations,
capital  expenditures,  debt  service and  current  dividend  policy.  If actual
developments  differ from our  expectations,  our  liquidity  could be adversely
affected.

Capital expenditures

     We intend to spend  approximately  $45 million for major  improvements  and
upgrades to our existing facilities during 2006,  including the $13.4 million we
have spent though June 30, 2006.

Off-balance sheet financing

     We do not have any off-balance  sheet financing  agreements  other than the
operating leases discussed in our 2005 Annual Report.

Commitments and contingencies

     See Notes 10 and 11 to the Condensed  Consolidated Financial Statements for
a description of certain legal proceedings and income tax examinations currently
underway.

Recent accounting pronouncements

     See Note 12 to the Condensed Consolidated Financial Statements.

Critical accounting policies

     For a discussion of our critical accounting policies, refer to Part I, Item
7 - "Management's  Discussion and Analysis of Financial Condition and Results of
Operations"  in our 2005  Annual  Report.  There  have  been no  changes  in our
critical accounting policies during the first six months of 2006.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

     We are exposed to market risk,  including  foreign currency exchange rates,
interest rates and security prices.  For a discussion of such market risk items,
refer to Part I,  Item 7A. -  "Quantitative  and  Qualitative  Disclosure  About
Market Risk" in our 2005 Annual Report.  There have been no material  changes in
these market risks during the first six months of 2006.

     We have substantial  operations located outside the United States for which
the  functional  currency  is not the U.S.  dollar.  As a result,  the  reported
amounts of our assets and liabilities  related to our non-U.S.  operations,  and
therefore our  consolidated  net assets,  will  fluctuate  based upon changes in
currency exchange rates.

     We  periodically  use currency  forward  contracts to manage a very nominal
portion  of  foreign  exchange  rate  risk  associated  with  trade  receivables
denominated in a currency other than the holder's functional currency or similar
exchange rate risk  associated with future sales. We have not entered into these
contracts for trading or  speculative  purposes in the past, nor do we currently
anticipate  entering into such contracts for trading or speculative  purposes in
the future.

     To manage our exchange  rate risk,  at June 30,  2006,  we held a series of
contracts,  with  expiration  dates  ranging  from July to  September  2006,  to
exchange an aggregate of U.S. $16.8 million for an equivalent amount of Canadian
dollars at exchange  rates  ranging from Cdn.  $1.1084 to Cdn.  $1.1642 per U.S.
dollar.  At June 30, 2006,  the actual  exchange rate was Cdn.  $1.1163 per U.S.
dollar.  The estimated fair value of such foreign currency forward  contracts at
June 30, 2006 is insignificant.

ITEM 4.  CONTROLS AND PROCEDURES

Evaluation of disclosure controls and procedures

     We  maintain  a system of  disclosure  controls  and  procedures.  The term
"disclosure  controls and  procedures,"  as defined by  regulations  of the SEC,
means controls and other procedures that are designed to ensure that information
required to be disclosed in the reports that the Company files or submits to the
SEC under the  Securities  Exchange  Act of 1934,  as amended  (the  "Act"),  is
recorded, processed,  summarized and reported, within the time periods specified
in the SEC's  rules and  forms.  Disclosure  controls  and  procedures  include,
without limitation,  controls and procedures designed to ensure that information
we are  required  to  disclose in the reports we file or submit to the SEC under
the  Act is  accumulated  and  communicated  to our  management,  including  our
principal  executive  officer and our principal  financial  officer,  or persons
performing  similar  functions,  as appropriate to allow timely  decisions to be
made  regarding  required  disclosure.  Each of  Harold  C.  Simmons,  our Chief
Executive  Officer,  and Gregory M. Swalwell,  our Vice  President,  Finance and
Chief  Financial  Officer,  have evaluated the design and  effectiveness  of our
disclosure  controls  and  procedures  as of June 30,  2006.  Based  upon  their
evaluation, these executive officers have concluded that our disclosure controls
and procedures are effective as of June 30, 2006.

Internal control over financial reporting

     We also  maintain  internal  control  over  financial  reporting.  The term
"internal  control over  financial  reporting," as defined by regulations of the
SEC,  means a process  designed by, or under the  supervision  of, our principal
executive  and  principal  financial  officers,  or persons  performing  similar
functions,  and  effected  by our  board  of  directors,  management  and  other
personnel,   to  provide  reasonable  assurance  regarding  the  reliability  of
financial  reporting and the  preparation  of financial  statements for external
purposes in accordance  with GAAP,  and includes  those  policies and procedures
that:

     o    Pertain  to the  maintenance  of  records  that in  reasonable  detail
          accurately and fairly reflect the transactions and dispositions of our
          assets,
     o    Provide  reasonable   assurance  that  transactions  are  recorded  as
          necessary to permit preparation of financial  statements in accordance
          with GAAP, and that our receipts and  expenditures are being made only
          in accordance with authorizations of our management and directors, and
     o    Provide reasonable  assurance regarding prevention or timely detection
          of an unauthorized acquisition,  use or disposition of our assets that
          could have a material effect on our Condensed  Consolidated  Financial
          Statements.

     As permitted by the SEC, our assessment of internal  control over financial
reporting  excludes (i) internal control over financial  reporting of its equity
method investees and (ii) internal control over the preparation of our financial
statement  schedules  required by Article 12 of  Regulation  S-X.  However,  our
assessment  of internal  control over  financial  reporting  with respect to our
equity  method  investees did include our controls over the recording of amounts
related  to our  investment  that are  recorded  in our  Condensed  Consolidated
Financial  statements,  including  controls  over the  selection  of  accounting
methods for our  investments,  the  recognition  of equity  method  earnings and
losses and the determination,  valuation and recording of our investment account
balances.

Changes in internal control over financial reporting

     There has been no change to our internal  control over financial  reporting
during the  quarter  ended June 30,  2006 that has  materially  affected,  or is
reasonably  likely to materially  affect,  the internal  control over  financial
reporting.


                           Part II. OTHER INFORMATION

Item 1. Legal Proceedings

     Refer to Note 10 of the Condensed  Consolidated Financial Statements and to
the 2005 Annual Report for descriptions of certain legal proceedings.

Item 1A. Risk Factors

     For a discussion of the risk factors  related to our  businesses,  refer to
Part I, Item 1A., "Risk Factors," in our 2005 Annual report.  There have been no
material changes to such risk factors during the six months ended June 30, 2006.

Item 4. Submission of Matters to a Vote of Security Holders

     We held our 2006 Annual Meeting of Shareholders  on May 24, 2006.  Keith R.
Coogan,  Cecil H. Moore,  Jr.,  George E. Poston,  Glenn R.  Simmons,  Harold C.
Simmons,  R. Gerald Turner and Steven L. Watson were elected as directors,  each
receiving  votes "For" their  election  from at least 98.7% of the 48.9  million
common shares eligible to vote at the Annual Meeting.

Item 6. Exhibits

     31.1 - Certification

     31.2 - Certification

     32.1 - Certification

We have  retained a signed  original of any of the above  exhibits that contains
signatures,  and will provide such exhibit to the  Commission  or its staff upon
request.  We will also furnish,  without charge,  a copy of our Code of Business
Conduct and Ethics,  our Audit  Committee  Charter and our Corporate  Governance
Guidelines,  each as adopted by the board of directors,  upon request.  Requests
should be directed to the attention of the Corporate  Secretary at our corporate
offices located at 5430 LBJ Freeway, Suite 1700, Dallas, Texas 75240.



                                   SIGNATURES


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 thereunto duly authorized.



                                              Kronos Worldwide, Inc.
                                        --------------------------------
                                                 (Registrant)



Date   August 4, 2006                   By /s/ Gregory M. Swalwell
      ---------------                      ----------------------------------
                                           Gregory M. Swalwell
                                            Vice President, Finance and Chief
                                             Financial Officer (Principal
                                             Financial Officer)


Date   August 4, 2006                   By /s/ Tim C. Hafer
      ---------------                      ----------------------------------
                                           Tim C. Hafer
                                            Vice President and Controller
                                            (Principal Accounting Officer)