Group 1 - The last analysis on Cabot Corporation (NYSE: CBT) occurred in late January, resulting in a downgrade to a 'Hold' rating due to muted growth rates and poor near-term EPS revisions [1] - The company operates in the specialty chemicals and performance materials sector, focusing on undervalued profitable stocks with strong balance sheets and minimal debt [1] Group 2 - The investment strategy includes writing calls against positions to generate additional income, with risk management controlled through position sizing and trailing stop losses [1]

Core Insights - Cabot Corporation (CBT) reported second-quarter fiscal 2025 earnings of $1.69 per share, an increase from $1.49 in the same quarter last year, with adjusted earnings at $1.90 per share, surpassing the Zacks Consensus Estimate of $1.86 [1] - The company's net sales for the quarter were $936 million, falling short of the Zacks Consensus Estimate of $1,038.1 million, representing an 8.2% decrease year-over-year [1] Segment Highlights - Sales in the Reinforcement Materials segment decreased by 12.1% year-over-year to $594 million, missing the Zacks Consensus Estimate of $678.5 million, with EBIT down 12.1% to $131 million due to lower tire demand and contract outcomes in South America [2] - Performance Chemicals unit sales remained flat at $311 million, below the Zacks Consensus Estimate of $328.9 million, while EBIT increased by 61.2% to $50 million, driven by higher volumes in fumed metal oxides for construction and semiconductor applications [3] Financials - At the end of the second quarter, the company had a cash balance of $213 million, with cash flows from operating activities generating $73 million [4] - Capital expenditures totaled $72 million, with $23 million used for dividends and $47 million for share repurchases during the quarter [4] Outlook - The company revised its adjusted EPS guidance for fiscal 2025 to a range of $7.15 to $7.50, reflecting expectations of softer demand due to the uncertain impact of recently implemented tariff policies [5][6] - The revised guidance assumes the company will maintain profit margins consistent with those achieved in the second fiscal quarter [6] Price Performance - Cabot's shares have declined by 27% over the past year, compared to a 30.4% decline in the industry [7]

Part I. Financial Information This section provides the unaudited interim financial statements, management's discussion and analysis, market risk disclosures, and controls and procedures for the company [Financial Statements (unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents Cabot Corporation's unaudited consolidated financial statements for the interim periods ended March 31, **2025**, and **2024**, along with detailed notes on accounting policies and disclosures [Consolidated Statements of Operations](index=3&type=section&id=Consolidated%20Statements%20of%20Operations) Cabot Corporation's unaudited consolidated statements show decreased net sales but increased net income for both the three and six months ended March **31**, **2025** Consolidated Statements of Operations Highlights (In millions, except per share amounts) | Metric | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | Six Months Ended Mar 31, 2025 | Six Months Ended Mar 31, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net sales and other operating revenues | $936 | $1,019 | $1,891 | $1,977 | | Gross profit | $241 | $246 | $476 | $464 | | Income from operations | $162 | $156 | $317 | $292 | | Net income attributable to Cabot Corporation | $94 | $84 | $187 | $134 | | Diluted Earnings per common share | $1.69 | $1.49 | $3.36 | $2.37 | [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) As of March **31**, **2025**, total assets increased slightly to **$3.784 billion**, while total liabilities also rose, and total stockholders' equity remained flat Consolidated Balance Sheet Highlights (In millions) | Metric | March 31, 2025 | September 30, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $213 | $223 | | Total current assets | $1,603 | $1,605 | | Net property, plant and equipment | $1,603 | $1,534 | | Total assets | $3,784 | $3,736 | | **Liabilities & Equity** | | | | Total current liabilities | $818 | $772 | | Long-term debt | $1,090 | $1,087 | | Total liabilities | $2,194 | $2,146 | | Total stockholders' equity | $1,590 | $1,590 | [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended March **31**, **2025**, cash provided by operating activities decreased, while cash used in investing activities increased, and cash used in financing activities significantly decreased Consolidated Cash Flow Summary (In millions) | Cash Flow Activity | Six Months Ended Mar 31, 2025 | Six Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Cash provided by operating activities | $197 | $281 | | Cash used in investing activities | ($174) | ($95) | | Cash used in financing activities | ($7) | ($195) | | Increase (decrease) in cash | ($10) | ($32) | | Cash and cash equivalents at end of period | $213 | $206 | [Notes to the Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) The notes provide detailed information supporting the financial statements, covering accounting policies, acquisitions, contingencies, and segment performance - In October **2024**, the Company acquired certain assets and licensed technology for its Battery Materials product line for **$27 million**, allocated to property, plant and equipment (**$19 million**) and intangible assets (**$8 million**)[37](index=37&type=chunk) - The Company maintains a reserve of **$34 million** as of March **31**, **2025**, for expected liabilities related to a former respirator products business[40](index=40&type=chunk)[41](index=41&type=chunk) - Foreign exchange losses related to Argentina were significantly lower in the first six months of fiscal **2025** (**$2 million**) compared to the same period in **2024** (**$40 million**), which included a **$33 million** loss from a single devaluation event[32](index=32&type=chunk) Segment EBIT (In millions) | Segment | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | Six Months Ended Mar 31, 2025 | Six Months Ended Mar 31, 2024 | | :--- | :--- | :--- | :--- | :--- | | Reinforcement Materials | $131 | $149 | $261 | $278 | | Performance Chemicals | $50 | $31 | $95 | $65 | | **Total Segment EBIT** | **$181** | **$180** | **$356** | **$343** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the financial results, highlighting decreased net sales but increased gross profit for the six-month period, alongside detailed segment performance, liquidity, and cash flow activities [Results of Operations](index=22&type=section&id=Results%20of%20Operations) Consolidated net sales for Q2 **2025** decreased year-over-year, while net income attributable to Cabot rose in both the quarter and six-month period, largely due to lower foreign exchange losses - Q2 **2025** net sales decreased by **$83 million** YoY, driven by lower Reinforcement Materials volumes (**$48M**), unfavorable pricing/mix (**$24M**), and negative currency impact (**$28M**), partly offset by higher Performance Chemicals volumes (**$16M**)[78](index=78&type=chunk)[79](index=79&type=chunk) - Net income for Q2 **2025** rose to **$94 million** from **$84 million** YoY, mainly due to higher Segment EBIT in Performance Chemicals (**+$19M**) and lower losses from Argentina's currency devaluation (**+$8M**), which offset lower EBIT from Reinforcement Materials (**-$18M**)[95](index=95&type=chunk) - The company expects the operating tax rate for fiscal **2025** to be in the range of **27% to 29%**[92](index=92&type=chunk) [Business Segment Analysis](index=27&type=section&id=Business%20Segment%20Analysis) In Q2 **2025**, Reinforcement Materials EBIT fell due to lower volumes, while Performance Chemicals EBIT grew from higher volumes and improved gross profit per ton Reinforcement Materials Segment Results (In millions) | Metric | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | Six Months Ended Mar 31, 2025 | Six Months Ended Mar 31, 2024 | | :--- | :--- | :--- | :--- | :--- | | Sales | $594 | $676 | $1,205 | $1,317 | | EBIT | $131 | $149 | $261 | $278 | - The decrease in Reinforcement Materials EBIT was primarily driven by lower volumes (**$20 million** impact) resulting from lower tire demand and contract outcomes in South America[103](index=103&type=chunk) Performance Chemicals Segment Results (In millions) | Metric | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | Six Months Ended Mar 31, 2025 | Six Months Ended Mar 31, 2024 | | :--- | :--- | :--- | :--- | :--- | | Sales | $311 | $311 | $622 | $596 | | EBIT | $50 | $31 | $95 | $65 | - The increase in Performance Chemicals EBIT was driven by higher gross profit per ton (**$9 million**) and higher volumes (**$9 million**), particularly in the Fumed Metal Oxides product line[107](index=107&type=chunk)[108](index=108&type=chunk) [Liquidity and Capital Resources](index=29&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity position decreased in the first six months of fiscal **2025**, with reduced cash from operations, increased capital expenditures, and significant share repurchases - As of March **31**, **2025**, the company had cash and cash equivalents of **$213 million** and borrowing availability of **$1.0 billion** under its revolving credit agreements[112](index=112&type=chunk) - Cash provided by operating activities decreased to **$197 million** in the first six months of fiscal **2025**, compared to **$281 million** in the prior year period, mainly due to an increase in net working capital[119](index=119&type=chunk)[120](index=120&type=chunk) - Capital expenditures for fiscal **2025** are projected to be between **$250 million and $275 million**[124](index=124&type=chunk) - During the first six months of fiscal **2025**, the company repurchased **$89 million** of its shares and paid **$47 million** in dividends to common stockholders[126](index=126&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=32&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that information regarding market risks for the period ended March **31**, **2025**, has not materially changed from prior disclosures - There are no material changes in market risk disclosures from the company's **2024** **10-K** report[131](index=131&type=chunk) [Controls and Procedures](index=32&type=section&id=Item%204.%20Controls%20and%20Procedures) Based on evaluation, the company's disclosure controls and procedures were effective as of March **31**, **2025**, with no material changes to internal controls over financial reporting - Management, including the CEO and CFO, concluded that as of March **31**, **2025**, the company's disclosure controls and procedures were effective[132](index=132&type=chunk) - No changes occurred during the fiscal quarter ended March **31**, **2025**, that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[133](index=133&type=chunk) Part II. Other Information This section includes information on unregistered sales of equity securities, other general disclosures, and a list of exhibits filed with the report [Unregistered Sales of Equity Securities and Use of Proceeds](index=33&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the quarter ended March **31**, **2025**, Cabot repurchased a total of **527,379** shares of common stock under a board-authorized program that was recently expanded Issuer Purchases of Equity Securities (Q2 2025) | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | January 2025 | — | — | | February 2025 | 462,379 | $86.51 | | March 2025 | 65,000 | $82.05 | | **Total** | **527,379** | **N/A** | - In December **2024**, the Board of Directors authorized the repurchase of an additional **ten million** shares of common stock[134](index=134&type=chunk) [Other Information](index=33&type=section&id=Item%205.%20Other%20Information) The company reports that no directors or officers entered into, modified, or terminated any Rule **10b5-1** trading plans or non-Rule **10b5-1** trading arrangements during the quarter - No directors or officers entered into, modified, or terminated Rule **10b5-1** trading plans or other trading arrangements during the quarter ended March **31**, **2025**[135](index=135&type=chunk) [Exhibits](index=34&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form **10-Q**, including corporate governance documents, equity award certificates, and required officer certifications - Filed exhibits include corporate governance documents, forms of equity award certificates, and required officer certifications (Rule **13a-14(a)** and Section **1350**)[136](index=136&type=chunk)

Financial Data and Key Metrics Changes - Adjusted earnings per share for Q2 2025 was $1.90, up 7% compared to $1.78 in Q2 2024, and up 10% for the first half of fiscal 2025 compared to the same period in fiscal 2024 [5][14] - Cash flow from operations was $73 million, with discretionary free cash flow at $110 million, and a cash balance of $213 million at the end of the quarter [14][15] - The company announced a 5% increase in its quarterly dividend, marking ten consecutive years of annual dividend increases [9][24] Business Segment Data and Key Metrics Changes - EBIT in Reinforcement Materials was $131 million, down 12% year-over-year, primarily due to lower tire demand [6][15] - Performance Chemicals saw EBIT increase by 61% year-over-year, driven by improved margins and higher volumes, particularly in the fumed silica product line [6][7] - Year-over-year volume growth of 10% was achieved in the battery materials product line during the first half of fiscal 2025 [8] Market Data and Key Metrics Changes - In The Americas, volumes were down 9%, with South America experiencing a significant decline due to lower contract outcomes [15][29] - Asia Pacific volumes decreased by 8%, primarily driven by reduced production during the Lunar New Year holiday [30] - European volumes remained flat year-over-year, with some gains in the contract season [32] Company Strategy and Development Direction - The company is focusing on high-performance segments in China and developing business with customers building battery plants in Western economies [8][12] - The "Creating for Tomorrow" strategy aims to position the company for long-term shareholder value creation [12][24] - The company is executing fixed cost and procurement initiatives expected to contribute $30 million in savings for fiscal 2025 [12][21] Management's Comments on Operating Environment and Future Outlook - Management noted that the current tariff landscape is dynamic, causing customers to adopt a cautious posture regarding inventory levels [11][19] - The company expects volumes in Reinforcement Materials to decline in the low single-digit percentage for the fiscal year, while Performance Chemicals is expected to see low single-digit percentage growth [22][24] - Despite uncertainties, management remains confident in the company's fundamentals and cash generation capabilities [24][25] Other Important Information - Capital expenditures for Q2 2025 were $72 million, with a revised full-year forecast of $250 million to $275 million [14][66] - The company maintains a strong liquidity position of approximately $1.2 billion [15] Q&A Session Summary Question: Can you provide context on the reinforcement volume changes? - Management explained that the volume picture varies by region, with significant declines in South America and a more cautious approach from customers in North America [27][28] Question: How do volumes split between North America and South America in the Reinforcement Materials segment? - Management indicated that approximately 60% of volumes come from North America and 40% from South America, with South American volumes down sharply [38][39] Question: What are the underlying price dynamics in the Reinforcement Materials segment? - Pricing remains largely flat due to contract negotiations, with steady margins in Asia Pacific's spot market [41][42] Question: What is the expected impact on energy center revenues? - Management expects a mid-single-digit million impact headwind in the second half due to declining oil prices [44] Question: Can you elaborate on the cost savings initiatives? - The $30 million in cost savings includes a mix of temporary and structural measures, with most savings expected to be recognized in the second half of the year [54][56] Question: What is the current capacity utilization across the industry? - Capacity utilization varies by region, with North America in the low 80s, Europe in the upper 80s, and Asia Pacific around 90% [62][63]

CABOT EARNINGS TELECONFERENCE Second Quarter - Fiscal 2025 Forward Looking Statements This presentation contains forward-looking statements. All statements that address expectations or projections about the future, including with respect to our expectations for our performance in the third quarter of and fiscal year 2025, including our expectations for performance and growth in our businesses and for adjusted earnings per share ('EPS") and adjusted earnings before interest, taxes, depreciation and amortizat ...

Financial Data and Key Metrics Changes - Adjusted earnings per share for Q2 2025 increased by 7% to $1.9 compared to Q2 2024, with a 10% growth in the first half of fiscal 2025 compared to the same period in fiscal 2024 [5][14][25] - EBIT in Reinforcement Materials was $131 million, up 1% sequentially but down 12% year over year [6][16] - EBIT in Performance Chemicals increased by 61% year over year, driven by improved margins and higher volumes [6][18] Business Line Data and Key Metrics Changes - Reinforcement Materials experienced a 7% decline in global volumes year over year, with regional declines of 9% in The Americas, 8% in Asia Pacific, and 1% in Europe [16][17] - Performance Chemicals saw a 4% increase in volumes year over year, particularly in the fumed silica product line [18] Market Data and Key Metrics Changes - The Americas market was heavily influenced by South America, where lower contract volumes were noted, while North America saw a small decline in volumes due to weak demand [30] - In Asia, volumes were down 8%, primarily due to a more normalized Lunar New Year holiday and cautious production adjustments by customers [31] Company Strategy and Development Direction - The company is focusing on high-performance segments in China and developing business with customers building battery plants in Western economies [7][12] - A 5% increase in quarterly dividends was announced, consistent with the capital allocation framework to increase dividends as earnings grow [9][25] - The company is executing fixed cost and procurement initiatives expected to contribute $30 million in savings for fiscal 2025 [12][21] Management's Comments on Operating Environment and Future Outlook - Management noted that the current tariff landscape is dynamic, causing customers to adopt a cautious posture regarding inventory levels [11][20] - The company expects volumes in Reinforcement Materials to decline in the low single-digit percentage for the fiscal year, while Performance Chemicals is expected to see low single-digit percentage growth [22][24] Other Important Information - Cash flow from operations was $73 million, with discretionary free cash flow of $110 million for the quarter [15] - Capital expenditures for Q2 2025 were $72 million, with a full-year forecast of $250 million to $275 million [15][67] Q&A Session Summary Question: Can you provide insight on the reinforcement volume changes? - Management explained that the volume picture varies by region, with significant declines in South America and a small decline in North America due to economic uncertainty [28][30][34] Question: How do volumes split between North America and South America? - Management indicated that approximately 60% of volumes come from North America and 40% from South America, with South American volumes down sharply [40][42] Question: What are the underlying price dynamics in the Reinforcement Materials segment? - Pricing is largely flat due to contract negotiations, with steady margins in Asia Pacific but lower than in the West [43][45] Question: What is the expected impact on energy center revenues? - Management expects some impact in the second half due to declining oil prices, with a mid-single-digit million headwind anticipated [46] Question: How is the seasonal trend expected to play out in Performance Chemicals? - Management noted that while seasonal trends remain, customers are exhibiting caution in inventory levels due to tariff uncertainties [52][55] Question: What is the current capacity utilization across the industry? - Capacity utilization varies by region, with North America in the low 80s, Europe in the upper 80s, and Asia Pacific around 90%, but a cautious approach is expected to lower these levels [62][64][66] Question: How is the CapEx split between growth and maintenance? - Approximately $100 million of the $250 million to $275 million CapEx is growth-related, primarily for new capacity in Indonesia [68]

Cabot (CBT) came out with quarterly earnings of $1.90 per share, beating the Zacks Consensus Estimate of $1.86 per share. This compares to earnings of $1.78 per share a year ago. These figures are adjusted for non- recurring items. This quarterly report represents an earnings surprise of 2.15%. A quarter ago, it was expected that this chemical company would post earnings of $1.80 per share when it actually produced earnings of $1.76, delivering a surprise of -2.22%. Over the last four quarters, the company ...

Exhibit 99.1 Investor Contact: Steve Delahunt (617) 342-6255 CABOT CORP REPORTS SECOND QUARTER FISCAL 2025 RESULTS Diluted earnings per share ("EPS") of $1.69 and Adjusted EPS of $1.90 BOSTON (May 5, 2025)-- Cabot Corporation (NYSE: CBT) today announced results for its second quarter of fiscal year 2025. Key Highlights | (In millions, except per share amounts) | | Three Months Ended | | | Six Months Ended | | | --- | --- | --- | --- | --- | --- | --- | | | 3/31/25 | | 3/31/24 | 3/31/25 | | 3/31/24 | | Net s ...

Core Insights - Cabot Corporation reported diluted earnings per share (EPS) of $1.69 and adjusted EPS of $1.90 for the second quarter of fiscal year 2025, reflecting a 7% increase in adjusted EPS compared to the same quarter in the prior year [4][6][10] Financial Performance - Net income attributable to Cabot Corporation was $94 million for the second quarter, compared to $84 million in the same period last year [4][6] - The company returned $70 million to shareholders through dividends and share repurchases during the second quarter [6][10] - The quarterly dividend was increased by 5% from $0.43 to $0.45 per share [6] Segment Results - Reinforcement Materials segment reported EBIT of $131 million, down 12% year-over-year due to lower tire demand and contract outcomes in South America [5][6] - Performance Chemicals segment saw EBIT increase by 61% year-over-year to $50 million, driven by higher volumes in fumed metal oxides related to construction and semiconductor applications [6][7] Cash Flow and Capital Expenditures - The company ended the second quarter with a cash balance of $213 million, with cash flows from operating activities amounting to $73 million [8] - Capital expenditures for the quarter were $72 million [8] Tax and Effective Tax Rate - The company recorded a tax expense of $49 million with an effective tax rate of 32% for the second quarter [9] Outlook - Adjusted EPS guidance for fiscal 2025 has been revised to a range of $7.15 to $7.50 due to uncertain impacts from recent tariff policies on customer demand [10] - The company expects to maintain strong operating cash flow, allowing for continued investment in strategic growth projects and shareholder returns [10]

Group 1 - Cabot Corporation declared a quarterly dividend of $0.45 per share, marking a 5% increase from the previous dividend of $0.43 per share [1] - The new annualized dividend rate is $1.80 per share compared to the previous rate of $1.72 per share [2] - The dividend is payable on June 13, 2025, to stockholders of record as of May 30, 2025 [1] Group 2 - The CEO of Cabot Corporation expressed confidence in the company's consistent earnings performance and strong cash flow generation [2] - The actions of increasing the dividend and authorizing share repurchase are part of the company's commitment to creating shareholder value [2] - Cabot Corporation is a global specialty chemicals and performance materials company, providing a range of products including reinforcing carbons and battery materials [3]