Core Points - Ashland Inc. plans to release its fourth-quarter fiscal 2025 earnings on November 4, 2025, at approximately 5 p.m. ET [1] - A live webcast for securities analysts will occur on November 5, 2025, at 9 a.m. ET, featuring an executive summary and detailed remarks [1] - The webcast and supporting materials will be available on Ashland's Investor Relations website, with an archived version accessible for 12 months post-event [3] Company Overview - Ashland Inc. is a global additives and specialty ingredients company focused on environmental, social, and governance (ESG) initiatives [4] - The company serves diverse markets, including architectural coatings, construction, energy, food and beverage, personal care, and pharmaceuticals [4] - Ashland employs approximately 2,960 professionals, including scientists, research chemists, engineers, and plant operators, to develop innovative solutions for customers in over 100 countries [4]

Core Insights - Ashland Inc. has appointed Sandy Klugman as the new director of Investor Relations, effective October 13, 2025, reporting to CFO William Whitaker [1][4]. Summary by Sections Appointment Details - Sandy Klugman joins Ashland with over 20 years of experience in investor relations, equity research, and investment analysis, and is a CFA charterholder [2]. - His previous role was as senior vice president of Investor Relations at ICR Strategic Communications and Advisory, where he advised various companies on investor relations strategies [2]. Professional Background - Klugman has a strong track record in developing investor engagement programs and crafting corporate narratives, with experience in both sell-side and buy-side equity analysis [3]. - He has worked with notable firms such as Susquehanna Financial Group, Credit Suisse, and UBS Securities, focusing on agriculture and chemicals sectors [3]. Educational Qualifications - Klugman holds an MBA in Finance and Accounting from the University of Chicago Booth School of Business and a Bachelor of Science in Communication from Cornell University [4]. Company Overview - Ashland Inc. is a global additives and specialty ingredients company, emphasizing environmental, social, and governance (ESG) principles [5]. - The company serves a diverse range of markets, including architectural coatings, construction, energy, food and beverage, personal care, and pharmaceuticals, employing approximately 2,960 professionals [5].

Core Insights - The international beauty raw material companies are facing significant challenges in 2025 due to global economic instability and unfavorable currency exchange rates, which have become the primary obstacle to growth [1][3] - Despite the challenges, there is still a vibrant innovation landscape in the beauty raw materials sector, driven by scientific advancements and a shift in consumer preferences towards effective and clinically validated ingredients [1][5] Financial Performance - BASE reported a total sales of €33.2 billion with a beauty raw materials segment sales of €2.468 billion, showing a year-on-year increase [2] - BASF experienced a slight decline in overall sales by 1.48% but saw a growth of 3.6% in its beauty raw materials segment [2] - Clariant's sales in beauty raw materials were not disclosed, while Symrise reported €2.554 billion in total sales with a 9.89% increase in its beauty raw materials segment [2] Market Trends - The beauty raw materials market is increasingly influenced by consumer demand for scientifically backed ingredients, moving away from mere ingredient trends to a focus on efficacy and clinical validation [4][5] - The rise of "neurocosmetics" is notable, with companies like DSM-Firmenich and Croda developing ingredients that not only enhance skin appearance but also positively affect emotional well-being [9][10] Innovation and R&D - Companies are investing in extensive R&D to develop active ingredients that meet the evolving market demands, with a focus on scientific validation and consumer experience [12][14] - The development of a comprehensive scientific framework for new ingredients is becoming essential, as companies aim to provide clear efficacy and safety data to consumers [12][15] Localization and Market Adaptation - International raw material companies are increasingly localizing their R&D and production in China to better cater to local consumer preferences and market dynamics [14][15] - Companies are also enhancing their scientific communication and service systems to build long-term value and support clients in navigating the complex beauty ingredient landscape [15]

Core Insights - The international beauty raw material companies are facing significant challenges in 2025 due to global economic fluctuations and unfavorable currency exchange rates, which have become the primary obstacle to growth [2][5] - Despite some growth in the beauty and personal care sectors, these companies are encountering new competitive pressures in the Chinese market, prompting a focus on innovation driven by scientific research [3][11] Financial Performance - The financial reports for the first half of 2025 show varying degrees of performance among international raw material companies, with overall sales and EBITDA experiencing fluctuations [5][6] - For instance, BASF reported a slight decline in overall sales by 1.48% but a growth of 3.6% in beauty raw materials, while DSM-Firmenich saw a 3.37% increase in overall sales but a decline in beauty raw materials by 0.89% [6] Market Trends - The Chinese market is viewed as a key opportunity for international raw material companies, despite increasing competition, as consumer preferences shift towards scientifically validated ingredients rather than trendy components [11][12] - The trend towards "scientific skincare" is pushing companies to develop active ingredients with clear scientific backing and clinical validation [14][21] Innovation and R&D - Companies are investing in advanced technologies and innovative ingredients tailored to the unique demands of the Chinese market, such as neurocosmetics that address emotional well-being and skin health [17][18] - The rise of neurocosmetics is evident, with a significant increase in products that offer emotional benefits, reflecting a shift in consumer focus from mere efficacy to sensory experiences [19][20] Strategic Approaches - International raw material companies are adopting a long-term approach to innovation, emphasizing foundational research and the development of a comprehensive scientific framework for their products [21][24] - Companies like DSM and Clariant are localizing their R&D efforts in China, aiming to create products that resonate with local consumer needs while building a robust scientific communication framework [26][27]

Core Viewpoint - Ashland Inc. has reported that a production unit at its Calvert City, Kentucky facility is offline due to an equipment-related incident, with repairs expected to be completed in fiscal Q1 2026 [1][2][4]. Group 1: Incident Details - The affected production unit was safely shut down for necessary repairs, which will include the fabrication and installation of new equipment [2]. - The damage is confined to Ashland's upstream operations, and while one unit is offline, the site remains partially operational [3]. Group 2: Operational Impact - Ashland does not anticipate any impact on customer deliveries or sales commitments during the repair period, supported by existing finished goods inventory and production from unaffected units [3]. - The primary impact is expected to be operational, including repair costs and absorption-related inefficiencies, with an estimated Adjusted EBITDA impact of approximately $10 million in fiscal 2026 [4]. Group 3: Future Updates - The company plans to provide an update on the status of repairs and operational impact during its Q4 earnings release [5].

Core Insights - Ashland Inc. is facing a challenging macroeconomic environment, with expected earnings decline of 18.9% in fiscal 2025 [1][9] - The company has a market capitalization of $2.4 billion and operates in over 100 countries across various markets [1] Financial Performance - In fiscal Q3 2025, Ashland reported earnings of $1.04, missing the Zacks Consensus Estimate by $0.11 [2] - Sales fell 15% year-over-year to $463 million, impacted by portfolio optimization which reduced sales by approximately $53 million, or 10% [3] - Excluding optimization effects, sales declined by 5% [3] - All main segments experienced falling sales: Life Sciences down 17% to $162 million, Personal Care down 16% to $147 million, Specialty Additives down 13% to $131 million, and Intermediates down 8% to $33 million [4] Outlook and Estimates - Ashland updated its fiscal 2025 outlook, indicating a stable but subdued macroeconomic environment with mixed demand trends across segments [5] - Analysts have cut earnings estimates for fiscal 2025 from $3.77 to $3.61, reflecting an 18.9% decline from last year's earnings of $4.45 [7] - For fiscal 2026, estimates have also been reduced from $4.71 to $4.39 [7] Market Performance - Ashland's shares have declined 21.2% year-to-date, underperforming the S&P 500, which is up 12.5% [11] - The company trades with a forward P/E of 14.7, indicating potential value, but has a high PEG ratio of 3.8, suggesting it may not be cheap by growth metrics [13][15] Additional Insights - The company is benefiting from foreign exchange tailwinds and a $30 million restructuring program expected to generate $7.5 million in savings in Q4 [6]

Company Overview - Ashland Inc. (ASH) is currently experiencing significant activity in the options market, particularly with the Oct. 17, 2025 $40 Call option showing high implied volatility, indicating potential for a major price movement [1] - The company holds a Zacks Rank of 5 (Strong Sell) within the Chemical – Specialty industry, which is positioned in the bottom 37% of the Zacks Industry Rank [3] Analyst Insights - Over the past 60 days, there has been mixed sentiment among analysts regarding Ashland's earnings estimates; one analyst has increased the estimate for the current quarter, while two have decreased theirs, resulting in a slight increase in the Zacks Consensus Estimate from $1.28 to $1.32 per share [3] Options Market Dynamics - The high implied volatility surrounding Ashland's options suggests that traders are anticipating a significant price movement, which could be indicative of an upcoming event that may lead to either a rally or a sell-off [2][4] - Options traders often seek to capitalize on high implied volatility by selling premium, aiming for the underlying stock to not move as much as expected by expiration, which is a common strategy among seasoned traders [4]

Core Insights - Ashland Global Holdings Inc. reported a significant loss of $742 million or $16.21 per share in Q3 fiscal 2025, contrasting with a profit of $6 million or 12 cents in the same quarter last year [1][9] - Adjusted earnings were $1.04 per share, down from $1.49 year-over-year, and missed the Zacks Consensus Estimate of $1.15 [1][9] - Total sales decreased by 14.9% year-over-year to $463 million, falling short of the Zacks Consensus Estimate of $468.4 million [2][9] Sales Performance - Life Sciences segment sales fell 17% year-over-year to $162 million, missing the consensus estimate of $170 million, primarily due to the divestiture of the Neutraceuticals division [3] - Personal Care segment sales declined 16% year-over-year to $147 million, meeting the Zacks Consensus Estimate, mainly due to portfolio optimization and the divestiture of the Avoca business line [4] - Specialty Additives segment sales decreased 13% year-over-year to $131 million, surpassing the Zacks Consensus Estimate of $124 million, attributed to exiting the low-margin construction business [4] - Intermediates segment sales dropped 8% year-over-year to $33 million, missing the consensus estimate of $34.8 million, primarily due to lower prices [5] Financial Overview - Cash and cash equivalents at the end of the quarter were $207 million, reflecting a sequential increase of approximately 23.2% [6] - Long-term debt rose to $1,382 million, up roughly 3.4% from the previous quarter [6] Future Outlook - For the full fiscal year, Ashland expects sales to range between $1.825 billion and $1.85 billion, and adjusted EBITDA to be between $400 million and $410 million, narrowing from previous estimates [7][9] Stock Performance - Ashland's shares have declined by 42.5% over the past year, compared to a 1.3% decline in the industry [8]

Core Viewpoint - Ashland reported a significant decline in revenue and adjusted EBITDA for Q3 FY2025, falling short of analysts' expectations, with management signaling caution due to ongoing market softness and macroeconomic uncertainty [1][15][17] Financial Performance - Revenue for Q3 FY2025 was $463 million, missing consensus estimates by $13.6 million, and down 14.9% year-over-year from $544 million [2][5] - Non-GAAP EPS from continuing operations was $1.04, below the $1.20 consensus and down 30.2% from $1.49 in Q3 FY2024 [2][12] - Adjusted EBITDA was $113 million, a decrease of 18.7% from $139 million in the prior year [2][12] - Ongoing free cash flow was $108 million, down from $112 million in Q3 FY2024 [2][11] Business Overview and Strategic Focus - Ashland operates in various markets including pharmaceuticals, personal care, coatings, and industrial materials, focusing on performance-enhancing ingredients [3] - The company is engaged in portfolio optimization, emphasizing high-value specialty offerings and operational efficiency [4][17] Segment Performance - Life Sciences segment saw a 17% decline in sales, but a 4% organic increase in pharmaceutical applications [6] - Personal Care revenue declined 16%, with a 27.9% Adjusted EBITDA margin despite lower sales [7] - Specialty Additives experienced a 13% sales drop, with Adjusted EBITDA falling 32% to $26 million [8][9] - Intermediates segment reported a sales decline, with Adjusted EBITDA down 22% [10] Cost Management and Restructuring - The company completed a $30 million restructuring program, expecting an additional $7.5 million in cost savings in Q4 [13] - A $60 million manufacturing optimization effort is underway to improve margins [13] Outlook - Management revised full-year guidance, projecting sales between $1.825 billion and $1.850 billion, and adjusted EBITDA between $400 million and $410 million [15][16] - The company anticipates a stronger Q4, driven by cost savings from restructuring [15] - Key focus areas include organic volume stabilization, margin control, and inventory management [16][17]

PART I - FINANCIAL INFORMATION [Item 1. Financial Statements](index=2&type=section&id=Item%201.%20Financial%20Statements) The financial statements for Q2 2025 reveal a **$742 million net loss**, primarily due to a **$706 million goodwill impairment**, with sales declining **15%** to **$463 million** and total assets decreasing from **$5.6 billion** to **$4.6 billion** | Financial Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Sales | $463 million | $544 million | | Gross Profit | $132 million | $186 million | | Operating Loss | $(708) million | $(61) million | | Net Loss | $(742) million | $6 million (Net Income) | | Diluted Loss Per Share | $(16.21) | $0.12 (Diluted EPS) | | Balance Sheet Item | June 30, 2025 | September 30, 2024 | | :--- | :--- | :--- | | Total Current Assets | $1,124 million | $1,195 million | | Goodwill | $705 million | $1,381 million | | Total Assets | $4,621 million | $5,645 million | | Long-term Debt | $1,382 million | $1,349 million | | Total Stockholders' Equity | $1,889 million | $2,868 million | | Cash Flow Item | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | | :--- | :--- | :--- | | Cash from Operating Activities | $94 million | $382 million | | Cash from Investing Activities | $0 million | $(54) million | | Cash from Financing Activities | $(161) million | $(310) million | | Decrease in Cash | $(93) million | $(18) million | [Note B – Divestitures](index=6&type=section&id=Note%20B%20%E2%80%93%20Divestitures) The company completed the Avoca business sale in Q2 2025, incurring an impairment charge, following a similar divestiture of the Nutraceuticals business in the prior fiscal year - Completed the sale of the Avoca business in Q2 2025, recording an impairment charge of **$183 million** for the nine months ended June 30, 2025[20](index=20&type=chunk)[22](index=22&type=chunk) - In the prior year, the sale of the Nutraceuticals business resulted in a **$99 million impairment charge** for the three and nine months ended June 30, 2024[23](index=23&type=chunk)[25](index=25&type=chunk) [Note D – Restructuring Activities](index=8&type=section&id=Note%20D%20%E2%80%93%20Restructuring%20Activities) Ashland initiated a new restructuring plan in fiscal 2025 to mitigate divestiture impacts and optimize manufacturing, resulting in accelerated depreciation charges - A new restructuring plan was initiated in fiscal 2025 to offset the impact of the Nutraceuticals sale and other portfolio actions[33](index=33&type=chunk) Accelerated Depreciation Expense | Period | Accelerated Depreciation Expense | | :--- | :--- | | Three months ended June 30, 2025 | $27 million | | Nine months ended June 30, 2025 | $40 million | [Note G – Goodwill and Other Intangible Assets](index=13&type=section&id=Note%20G%20%E2%80%93%20Goodwill%20and%20Other%20Intangible%20Assets) A **$706 million** goodwill impairment was recorded in Q3 2025, impacting Life Sciences and Specialty Additives, driven by stock price decline and a weakening macroeconomic environment - Triggering events, including a decline in stock price and slowing growth, led to a quantitative goodwill impairment assessment during Q3 2025[55](index=55&type=chunk) Goodwill Impairment Charge | Reporting Unit | Goodwill Impairment Charge | | :--- | :--- | | Life Sciences | $375 million | | Specialty Additives | $331 million | | **Total** | **$706 million** | - The goodwill impairment charges are non-deductible for tax purposes[57](index=57&type=chunk) [Note H – Debt and Other Financing Activities](index=16&type=section&id=Note%20H%20%E2%80%93%20Debt%20and%20Other%20Financing%20Activities) As of June 30, 2025, total long-term debt was **$1.38 billion**, with **$596 million** available under the revolving credit facility, and the company complied with all debt covenants - Total long-term debt (less issuance costs) was **$1,382 million** at June 30, 2025[69](index=69&type=chunk) - Available borrowing capacity under the 2022 Credit Agreement was **$596 million** as of June 30, 2025[77](index=77&type=chunk) Debt Covenant Compliance | Debt Covenant | Requirement | Actual (June 30, 2025) | | :--- | :--- | :--- | | Max. Net Leverage Ratio | 4.0 | 2.9 | | Min. Interest Coverage Ratio | 3.0 | 6.5 | [Note L – Litigation, Claims and Contingencies](index=21&type=section&id=Note%20L%20%E2%80%93%20Litigation%2C%20Claims%20and%20Contingencies) As of June 30, 2025, the company held **$450 million** in asbestos reserves and **$242 million** for environmental remediation Reserves | Reserve Type | Amount (June 30, 2025) | | :--- | :--- | | Ashland Asbestos Reserve | $265 million | | Hercules Asbestos Reserve | $185 million | | Environmental Remediation Reserve | $242 million | - The company estimates that the upper range of reasonably possible future costs for environmental remediation could be as high as approximately **$510 million**[124](index=124&type=chunk) [Note N – Equity Items](index=30&type=section&id=Note%20N%20%E2%80%93%20Equity%20Items) Ashland repurchased **$100 million** of common stock, with **$520 million** remaining under its **$1 billion** program, and increased its quarterly dividend by **2%** to **$0.415** per share - **$520 million** remained available for repurchase under the 2023 Stock Repurchase Program as of June 30, 2025[128](index=128&type=chunk) - For the nine months ended June 30, 2025, the company repurchased **1.5 million shares** for an aggregate price of **$100 million**[129](index=129&type=chunk) - The quarterly cash dividend was increased by **2%** to **$0.415 per share**, paid in Q3 2025[130](index=130&type=chunk) [Note Q – Reportable Segment Information](index=34&type=section&id=Note%20Q%20%E2%80%93%20Reportable%20Segment%20Information) Q3 2025 segment performance was severely impacted by goodwill impairments in Life Sciences and Specialty Additives, resulting in operating losses and sales declines across all segments Segment Performance | Segment | Sales (Q3 2025) | Sales (Q3 2024) | Operating Income (Loss) (Q3 2025) | | :--- | :--- | :--- | :--- | | Life Sciences | $162M | $195M | $(343)M | | Personal Care | $147M | $175M | $25M | | Specialty Additives | $131M | $150M | $(345)M | | Intermediates | $33M | $36M | $4M | - The operating loss in Life Sciences includes a **$375 million goodwill impairment**[152](index=152&type=chunk) - The operating loss in Specialty Additives includes a **$331 million goodwill impairment**[152](index=152&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=40&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Q3 2025 sales declined **15%** due to divestitures and lower volumes, with a significant net loss driven by a **$706 million** goodwill impairment, while the full-year 2025 outlook projects sales of **$1.825-$1.850 billion** and Adjusted EBITDA of **$400-$410 million** - The company recorded a total non-cash goodwill impairment charge of **$706 million** (**$375 million** for Life Sciences and **$331 million** for Specialty Additives) in Q3 2025 due to a decline in stock price and a weakening macroeconomic environment[173](index=173&type=chunk) Drivers of Sales Change (Q3 2025 vs Q3 2024) | Driver of Sales Change | Impact (in millions) | | :--- | :--- | | Divestitures | $(42) | | Volume | $(35) | | Price/mix | $(11) | | Foreign currency exchange | $7 | | **Total Change** | **$(81)** | - Updated full-year fiscal 2025 outlook: Sales of approximately **$1.825 billion to $1.850 billion** and Adjusted EBITDA in the range of **$400 million to $410 million**[318](index=318&type=chunk) [Results of Operations – Reportable Segment Review](index=60&type=section&id=Results%20of%20Operations%20%E2%80%93%20Reportable%20Segment%20Review) Q3 2025 sales declined across all segments, with Life Sciences down **17%** and Personal Care down **16%** due to divestitures and lower volumes, while Adjusted EBITDA decreased for most segments Segment Performance (Q3'25 vs Q3'24) | Segment | Sales Change (Q3'25 vs Q3'24) | Adjusted EBITDA (Q3'25) | Adjusted EBITDA (Q3'24) | | :--- | :--- | :--- | :--- | | Life Sciences | -17% | $54M | $59M | | Personal Care | -16% | $41M | $51M | | Specialty Additives | -13% | $26M | $38M | | Intermediates | -8% | $7M | $9M | [Financial Position](index=72&type=section&id=Financial%20Position) As of June 30, 2025, the company maintained **$803 million** in available liquidity, with ongoing Free Cash Flow at **$75 million**, a decrease from the prior year, and total debt at **$1.38 billion** Cash Flow Metrics | Liquidity Metric | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | | :--- | :--- | :--- | | Free Cash Flow | $30 million | $283 million | | Ongoing Free Cash Flow | $75 million | $182 million | - Total available liquidity, including cash and the revolving credit facility, was **$803 million** at June 30, 2025[293](index=293&type=chunk) - Debt as a percent of capital employed increased to **42%** at June 30, 2025, from **32%** at September 30, 2024[295](index=295&type=chunk) [Outlook](index=80&type=section&id=Outlook) Ashland updated its full-year fiscal 2025 outlook, projecting sales of **$1.825-$1.850 billion** and Adjusted EBITDA of **$400-$410 million**, reflecting a subdued macroeconomic environment - The company updated its full-year fiscal 2025 outlook due to a subdued macroeconomic environment and cautious customer channels[314](index=314&type=chunk) FY2025 Outlook | FY2025 Outlook | Range | | :--- | :--- | | Sales | $1.825 billion - $1.850 billion | | Adjusted EBITDA | $400 million - $410 million | - The company's **$30 million** restructuring program is expected to generate approximately **$7.5 million** in savings in the fourth quarter[317](index=317&type=chunk) [Item 4. Controls and Procedures](index=81&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no significant changes to internal control over financial reporting during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[321](index=321&type=chunk) - There were no significant changes in internal control over financial reporting during the nine months ended June 30, 2025[322](index=322&type=chunk) PART II – OTHER INFORMATION [Item 1. Legal Proceedings](index=82&type=section&id=Item%201.%20Legal%20Proceedings) The company faces material legal proceedings, primarily asbestos litigation and environmental matters, stemming from historical operations of Ashland and Hercules - Ashland is subject to liabilities from personal injury claims caused by asbestos exposure, primarily from indemnification obligations for the sale of Riley Stoker Corporation and the acquisition of Hercules LLC[325](index=325&type=chunk)[326](index=326&type=chunk) - The company has been identified as a "potentially responsible party" (PRP) at **53 environmental cleanup sites** under CERCLA and similar state laws as of June 30, 2025[328](index=328&type=chunk) [Item 1A. Risk Factors](index=83&type=section&id=Item%201A.%20Risk%20Factors) No material changes were reported to the risk factors previously disclosed in the Annual Report on Form 10-K for the fiscal year ended September 30, 2024 - No material changes from the risk factors disclosed in the Annual Report on Form 10-K for the fiscal year ended September 30, 2024[332](index=332&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=83&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Ashland did not repurchase common stock in Q3 2025, with **$520 million** remaining available under its **$1 billion** share repurchase program - No shares were repurchased during the three months ended June 30, 2025[333](index=333&type=chunk) - As of June 30, 2025, **$520 million** remained available for repurchase under the 2023 Stock Repurchase Program[333](index=333&type=chunk)