Core Insights - Ecovyst Inc. released its 2024 Sustainability Report, highlighting progress towards sustainability goals and key metrics related to greenhouse gas emissions, energy, water, and waste [1][2] - The company emphasizes its commitment to developing cleaner technologies and supporting sustainable industries through its products and services, including sulfuric acid and catalysts [2][4] - Ecovyst aims to achieve specific sustainability goals by 2025 and 2030, with a focus on maintaining a zero OSHA recordables injury rate [2] Company Overview - Ecovyst Inc. is a global provider of advanced materials, specialty catalysts, virgin sulfuric acid, and sulfuric acid regeneration services, contributing to environmental sustainability [3][4] - The company operates two specialty businesses: Ecoservices, which provides sulfuric acid recycling and chemical waste handling, and Advanced Materials & Catalysts, which focuses on silica catalysts and zeolites for sustainable applications [4]

Core Viewpoint - Ecovyst Inc. has successfully acquired the sulfuric acid production assets from Cornerstone Chemical Company, enhancing its capacity and supply reliability in the sulfuric acid market [1][2]. Company Overview - Ecovyst Inc. is a global provider of advanced materials, specialty catalysts, virgin sulfuric acid, and sulfuric acid regeneration services, with a focus on sustainability [3]. - The company operates through two main business segments: Ecoservices, which provides sulfuric acid recycling and high-quality virgin sulfuric acid, and Advanced Materials & Catalysts, which offers finished silica catalysts and specialty zeolites [4]. Acquisition Details - The acquisition of the Waggaman, Louisiana assets is expected to increase network flexibility and supply reliability, addressing future growth in demand for virgin sulfuric acid and regeneration services [2]. - The integration of Cornerstone's assets is anticipated to enhance Ecovyst's operational capabilities and customer service [2].

PART I FINANCIAL INFORMATION [Item 1. Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) The unaudited condensed consolidated financial statements for Q1 2025 report a net loss of $3.6 million, a decrease from $1.2 million net income in Q1 2024, driven by lower gross profit, with total assets at $1.79 billion and operating cash flow at $10.3 million [Condensed Consolidated Statements of (Loss) Income](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20(Loss)%20Income) Q1 2025 saw a net loss of $3.6 million ($0.03 per share) compared to $1.2 million net income in Q1 2024, primarily due to a decrease in gross profit from $39.2 million to $25.6 million Condensed Consolidated Statements of (Loss) Income (in thousands) | | Three months ended March 31, 2025 | Three months ended March 31, 2024 | | :--- | :--- | :--- | | **Sales** | $162,197 | $160,537 | | **Gross profit** | $25,615 | $39,223 | | **Operating (loss) income** | $(912) | $13,953 | | **Net (loss) income** | $(3,597) | $1,221 | | **Diluted (loss) income per share** | $(0.03) | $0.01 | [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets slightly decreased to $1.787 billion from $1.802 billion, with total liabilities at $1.088 billion and cash at $127.5 million Balance Sheet Highlights (in thousands) | | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total current assets** | $291,963 | $303,714 | | **Total assets** | $1,786,922 | $1,802,321 | | **Total current liabilities** | $104,033 | $115,126 | | **Total liabilities** | $1,088,238 | $1,101,861 | | **Total equity** | $698,684 | $700,460 | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2025 net cash from operations significantly decreased to $10.3 million from $36.5 million, with net cash used in investing at $24.3 million, resulting in an $18.5 million net decrease in cash Cash Flow Summary (in thousands) | | Three months ended March 31, 2025 | Three months ended March 31, 2024 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $10,256 | $36,503 | | **Net cash used in investing activities** | $(24,253) | $(17,372) | | **Net cash used in financing activities** | $(4,451) | $(4,183) | | **Net change in cash and cash equivalents** | $(18,535) | $14,771 | [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail business segments, revenue recognition, debt structure, and segment performance, highlighting the Zeolyst Joint Venture's growth, debt modification, and a pending asset acquisition - The company operates through two main segments: Ecoservices (sulfuric acid recycling and virgin sulfuric acid) and Advanced Materials & Catalysts (silica and zeolite catalysts)[25](index=25&type=chunk) Disaggregated Revenue by Segment (Q1 2025, in thousands) | Segment | Sales | | :--- | :--- | | Ecoservices | $143,109 | | Advanced Materials & Catalysts | $19,088 | | **Total** | **$162,197** | - In January 2025, the company amended its Term Loan Credit Agreement, reducing the applicable interest rate on SOFR term loans to Term SOFR plus **2.00%**, resulting in a **$960 thousand** debt modification cost[68](index=68&type=chunk)[69](index=69&type=chunk) - The Zeolyst Joint Venture, a 50% owned affiliate, showed significant growth, with sales increasing to **$89.5 million** in Q1 2025 from **$56.9 million** in Q1 2024[62](index=62&type=chunk) - Subsequent to the quarter end, the company entered an agreement to acquire sulfuric acid production assets for **$35 million**, expected to close in Q2 2025[117](index=117&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes Q1 2025 sales growth to Ecoservices pricing, despite a 34.7% gross profit decline due to maintenance costs, with Adjusted EBITDA decreasing 14.5% to $38.9 million, while liquidity remains strong at $201.1 million [Results of Operations](index=32&type=section&id=Results%20of%20Operations) Q1 2025 sales increased to $162.2 million, but gross profit fell by $13.6 million to $25.6 million, leading to an operating loss of $0.9 million, partially offset by $8.9 million in equity income Financial Performance Summary (in millions) | | Q1 2025 | Q1 2024 | Change $ | Change % | | :--- | :--- | :--- | :--- | :--- | | **Sales** | $162.2 | $160.5 | $1.7 | 1.1% | | **Gross Profit** | $25.6 | $39.2 | $(13.6) | (34.7)% | | **Operating (Loss) Income** | $(0.9) | $13.9 | $(14.8) | (106.5)% | | **Equity in net income** | $8.9 | $2.1 | $6.8 | 323.8% | | **Net (Loss) Income** | $(3.6) | $1.2 | $(4.8) | NM | - Ecoservices sales increased **1.1%** to **$143.1 million**, driven by higher average selling prices from the pass-through of higher sulfur costs, offset by lower sales volume due to maintenance turnarounds[147](index=147&type=chunk)[148](index=148&type=chunk) - Equity in net income from affiliated companies, primarily the Zeolyst Joint Venture, increased by **$6.8 million** due to higher sales volume of hydrocracking and specialty catalysts[146](index=146&type=chunk)[154](index=154&type=chunk) [Adjusted EBITDA](index=35&type=section&id=Adjusted%20EBITDA) Total Adjusted EBITDA decreased 14.5% to $38.9 million in Q1 2025, with Ecoservices' EBITDA falling 31.3% to $28.5 million, partially offset by a 57.7% increase in Advanced Materials & Catalysts' EBITDA to $17.5 million Adjusted EBITDA by Segment (in millions) | Segment | Q1 2025 | Q1 2024 | Change $ | Change % | | :--- | :--- | :--- | :--- | :--- | | Ecoservices | $28.5 | $41.5 | $(13.0) | (31.3)% | | Advanced Materials & Catalysts | $17.5 | $11.1 | $6.4 | 57.7% | | Unallocated corporate expenses | $(7.1) | $(7.1) | $— | —% | | **Total** | **$38.9** | **$45.5** | **$(6.6)** | **(14.5)%** | - The decrease in Ecoservices' Adjusted EBITDA was driven by approximately **$8 million** in higher manufacturing costs from planned maintenance, **$3 million** from lower volume, and **$2 million** from unfavorable net pricing[164](index=164&type=chunk) - The increase in Advanced Materials & Catalysts' Adjusted EBITDA was primarily due to higher sales volume within the Zeolyst Joint Venture[165](index=165&type=chunk) [Financial Condition, Liquidity and Capital Resources](index=38&type=section&id=Financial%20Condition,%20Liquidity%20and%20Capital%20Resources) The company maintains sufficient liquidity for the next twelve months, with $201.1 million available as of March 31, 2025, and total debt at $868.6 million, while Q1 capital expenditures increased to $20.4 million - As of March 31, 2025, the company had total available liquidity of **$201.1 million**, with no borrowings under its ABL revolving credit facility[170](index=170&type=chunk) Debt Summary (in millions) | | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total debt | $868.6 | $870.8 | | Less: Cash and cash equivalents | $127.5 | $146.0 | | **Net Debt** | **$741.1** | **$724.8** | - Capital expenditures increased to **$20.4 million** in Q1 2025 from **$14.4 million** in Q1 2024, driven by higher maintenance spending (**$16.6 million**) and growth projects (**$3.8 million**)[184](index=184&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=41&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes occurred in the company's market risk exposures, which include foreign currency, interest rate, and credit risks, managed through non-speculative derivative instruments - There have been no material changes in the company's primary market risks, which include foreign currency exchange, interest rate, and credit risk[191](index=191&type=chunk) - The company utilizes financial instruments for hedging purposes only, not for speculation, to mitigate underlying economic exposures[190](index=190&type=chunk) [Item 4. Controls and Procedures](index=41&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were ineffective as of March 31, 2025, due to a material weakness in accounting for the Zeolyst Joint Venture, with a remediation plan underway - Management concluded that disclosure controls and procedures were **not effective** as of March 31, 2025[193](index=193&type=chunk) - A material weakness related to the controls over the accounting of the Zeolyst Joint Venture, identified as of December 31, 2024, continues to exist[196](index=196&type=chunk) - The company is developing a remediation plan to design and implement appropriate controls to address the material weakness[197](index=197&type=chunk) PART II OTHER INFORMATION [Item 1. Legal Proceedings](index=42&type=section&id=Item%201.%20Legal%20Proceedings) The company believes no pending legal proceedings are likely to have a material adverse effect on its business - The company states that it does not believe any currently pending litigation will have a material adverse effect on its business[199](index=199&type=chunk) [Item 1A. Risk Factors](index=42&type=section&id=Item%201A.%20Risk%20Factors) No material changes have occurred from the risk factors described in the Annual Report on Form 10-K - No material changes have occurred from the risk factors described in the Annual Report on Form 10-K[200](index=200&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=42&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company did not repurchase common stock in Q1 2025, with $229.6 million remaining available under its repurchase program - No common stock was repurchased during Q1 2025[201](index=201&type=chunk) - As of March 31, 2025, **$229.6 million** was still available for share repurchases under the authorized program[201](index=201&type=chunk) [Item 5. Other Information](index=42&type=section&id=Item%205.%20Other%20Information) No directors or executive officers adopted, modified, or terminated Rule 10b5-1 trading arrangements during Q1 2025 - No directors or executive officers adopted, modified, or terminated a Rule 10b5-1 trading arrangement in Q1 2025[202](index=202&type=chunk) [Item 6. Exhibits](index=43&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including credit agreement amendments and CEO/CFO certifications

Group 1 - The conference call is for Ecovyst's first quarter 2025 earnings, featuring CEO Kurt Bitting and CFO Mike Feehan [2] - The call includes forward-looking information regarding the company's financial and operational performance, strategy, and demand trends for 2025 [3] - Non-GAAP financial measures will be reconciled with GAAP measures in the earnings release and presentation materials available on the company's website [4]

Ecovyst (ECVT) Q1 2025 Earnings Call May 01, 2025 11:00 AM ET Company Participants Gene Shiels - Director of Investor RelationKurt Bitting - CEO & DirectorMike Feehan - CFOHamed Khorsand - Principal Conference Call Participants John McNulty - MD - Chemicals AnalystPatrick Cunningham - AnalystNone - AnalystDaniel Rizzo - Analyst Operator Good morning. My name is Madison, and I will be your conference operator today. Welcome to the ECOVIST First Quarter twenty twenty five Earnings Call and Webcast. Please not ...

Ecovyst (ECVT) Q1 2025 Earnings Call May 01, 2025 11:00 AM ET Company Participants Gene Shiels - Director of Investor RelationKurt Bitting - CEO & DirectorMike Feehan - CFOHamed Khorsand - Principal Conference Call Participants John McNulty - MD - Chemicals AnalystPatrick Cunningham - AnalystNone - AnalystDaniel Rizzo - Analyst Operator Good morning. My name is Madison, and I will be your conference operator today. Welcome to the ECOVIST First Quarter twenty twenty five Earnings Call and Webcast. Please not ...

Financial Data and Key Metrics Changes - The first quarter total sales were $200 million, up nearly 9% year-over-year, with Eco Services and Advanced Silicas each up 1%, and sales for the Zeolyst joint venture up 60% [22][24][30] - Adjusted EBITDA for the first quarter was $39 million, primarily driven by higher volume in the Zeolyst joint venture, but lower earnings in Eco Services due to higher planned turnaround costs [22][24] - Adjusted free cash flow for the first quarter was a use of $13 million, with expectations to generate adjusted free cash flow of $60 million to $80 million for the full year [27][30] Business Line Data and Key Metrics Changes - Eco Services sales were $143 million, up 1% compared to the prior year, with adjusted EBITDA of $29 million, down from $42 million due to higher manufacturing costs and lower sales volume related to turnaround activity [24][25] - Advanced Silicas sales were $19 million, with higher sales of niche custom catalysts offset by lower sales of advanced silicas used in polyethylene production [25][30] - The Zeolyst joint venture saw a significant increase in sales, contributing to the overall sales growth for the company [22][25] Market Data and Key Metrics Changes - The Ecoservices segment accounts for approximately 75% of total sales, with minimal exposure to tariffs due to its U.S.-centric and service-oriented nature [10][12] - The company anticipates higher sales of virgin sulfuric acid in the second half of the year driven by increased mining demand [15][30] - The outlook for polyethylene catalyst sales remains cautious due to potential tariff impacts and macroeconomic conditions [19][30] Company Strategy and Development Direction - The company is focused on opportunistic share repurchases, believing that its current valuation does not reflect the intrinsic value of the business [7][9] - The acquisition of Cornerstone sulfuric acid assets is expected to enhance the Ecoservices network and provide additional capacity [37][56] - The strategic review of the Advanced Materials and Catalysts segment is ongoing, with expectations to run through midyear [38] Management's Comments on Operating Environment and Future Outlook - Management expressed caution regarding potential weaker demand in industrial end uses due to macroeconomic conditions and tariff impacts [29][35] - The company maintains its full-year guidance for adjusted EBITDA in the range of $238 million to $258 million, despite the challenges [30][36] - There is confidence in the long-term demand fundamentals for the majority of end uses served by the company [35][36] Other Important Information - The company expects to close the acquisition of Cornerstone in the second quarter, with incremental adjusted EBITDA contributions anticipated to be more material beginning in 2026 [31][37] - The company has a strong order book for hydrocracking catalyst sales, which may offset any softer sales in advanced silicas [20][36] Q&A Session Summary Question: Has there been a slowdown in polyethylene catalyst sales due to tariffs? - Management indicated that there has not been any observed slowdown related to tariffs, but they are monitoring the situation closely [43][44] Question: What are the expectations for sulfuric acid pricing? - Management noted that sulfur prices have increased due to U.S. refining turnaround work, and they expect to pass these costs through to customers [51][53] Question: What are the synergy potentials from the Cornerstone acquisition? - Management highlighted that the acquisition would enhance the sulfuric acid network, providing operational efficiencies and the ability to service customers more reliably [55][66] Question: How does the company view the demand outlook for 2025? - Management expects the demand to be back-end loaded for 2025, with strong fundamentals in their end markets despite macroeconomic uncertainties [60][62]

Company Performance - Ecovyst reported quarterly earnings of $0.01 per share, surpassing the Zacks Consensus Estimate of a loss of $0.03 per share, representing an earnings surprise of 133.33% [1] - The company posted revenues of $162.2 million for the quarter ended March 2025, missing the Zacks Consensus Estimate by 6.29% and showing a slight increase from $160.5 million year-over-year [2] - Over the last four quarters, Ecovyst has surpassed consensus EPS estimates two times but has not beaten consensus revenue estimates [2] Stock Outlook - Ecovyst shares have declined approximately 21.7% since the beginning of the year, compared to a decline of 5.3% for the S&P 500 [3] - The current consensus EPS estimate for the upcoming quarter is $0.16 on revenues of $199.73 million, and for the current fiscal year, it is $0.61 on revenues of $772.82 million [7] - The estimate revisions trend for Ecovyst is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6] Industry Context - The Chemical - Specialty industry, to which Ecovyst belongs, is currently ranked in the bottom 41% of over 250 Zacks industries, suggesting potential challenges for stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact investor sentiment [5]

First Quarter 2025 May 1, 2025 — 11 a.m. ET Legal Discussion Forward-Looking Statements Some of the information contained in this presentation, the conference call during which this presentation is reviewed and any discussions that follow constitutes "forward-looking statements." Forward-looking statements can be identified by words such as "anticipates," "intends," "plans," "seeks," "believes," "estimates," "expects," "projects" and similar references to future periods. Forward-looking statements are based ...

Financial Performance - Sales for Q1 2025 were $162.2 million, a slight increase from $160.5 million in Q1 2024[4] - Net loss for Q1 2025 was $3.6 million, compared to a net income of $1.2 million in the same quarter last year, resulting in a net loss margin of 2.2%[4] - Adjusted EBITDA for Q1 2025 was $38.9 million, down from $45.5 million in Q1 2024, with an Adjusted EBITDA margin of 19.5%[4] - Operating loss for Q1 2025 was $0.9 million, a significant decline of 106.5% compared to an operating income of $13.9 million in Q1 2024[24] - Adjusted Net Income for the first quarter of 2025 was $1.6 million, compared to $7.0 million in the first quarter of 2024[31] Segment Performance - Ecoservices segment sales increased to $143.1 million in Q1 2025 from $141.6 million in Q1 2024, but Adjusted EBITDA decreased to $28.5 million from $41.5 million[5] - Advanced Materials & Catalysts segment saw sales rise to $19.1 million in Q1 2025 from $18.9 million in Q1 2024, with Adjusted EBITDA increasing to $17.5 million from $11.1 million[6] - Zeolyst Joint Venture sales surged by 60.4% to $37.7 million from $23.5 million year-over-year[33] - Ecoservices Adjusted EBITDA margin decreased to 19.9% from 29.3% year-over-year[33] - Advanced Materials & Catalysts Adjusted EBITDA increased by 57.7% to $17.5 million from $11.1 million in the previous year[33] Cash Flow and Debt - Cash flows from operating activities were $10.3 million in Q1 2025, significantly down from $36.5 million in Q1 2024[7] - Cash and cash equivalents decreased to $127.5 million from $146.0 million at the end of Q4 2024[26] - The net debt leverage ratio was 3.2x as of March 31, 2025, with total gross debt of $868.6 million[7] - The Net Debt Leverage ratio increased to 3.2x as of March 31, 2025, compared to 2.9x a year earlier[35] - Total debt as of March 31, 2025, was $868.6 million, a slight decrease from $875.3 million a year prior[35] Guidance and Outlook - The company reaffirmed its full-year 2025 Adjusted EBITDA guidance and increased sales outlook to $785 million to $845 million, up from $755 million to $815 million[10] - Adjusted Net Income for the full year 2025 is projected to be between $58 million and $85 million, with Adjusted Diluted Income per share expected to be between $0.50 and $0.70[15] Tax and Equity - The effective tax rate for Q1 2025 was 13.3%, compared to 49.1% in Q1 2024[24] - The company reported a significant increase in equity in net income from affiliated companies, which was a loss of $8.9 million in Q1 2025 compared to a loss of $2.1 million in Q1 2024, representing a 323.8% increase in losses[24] Other Financial Metrics - Cost of goods sold increased by 12.6% to $136.6 million, resulting in a gross profit of $25.6 million, down 34.7% from $39.2 million[24] - Total assets as of March 31, 2025, were $1,786.9 million, a slight decrease from $1,802.3 million at the end of 2024[26] - Total liabilities decreased to $1,088.2 million from $1,101.8 million at the end of 2024[26] - Adjusted Free Cash Flow for the first quarter of 2025 was $(13.0) million, a significant decline from $19.1 million in the same quarter of 2024[34]