Olin(OLN) - 2025 Q1 - Quarterly Report

PART I — FINANCIAL INFORMATION Olin's unaudited Q1 2025 financial statements, management's discussion, and market risk disclosures ITEM 1. FINANCIAL STATEMENTS Unaudited condensed financial statements, including balance sheets, operations, cash flows, and detailed notes Condensed Balance Sheets Balance Sheet Overview | Metric | March 31, 2025 ($ in millions) | December 31, 2024 ($ in millions) | March 31, 2024 ($ in millions) | | :-------------------------------- | :------------------------------ | :------------------------------ | :------------------------------ | | Total Assets | 7,655.0 | 7,579.1 | 7,611.3 | | Total Liabilities | 5,616.9 | 5,523.7 | 5,404.2 | | Total Equity | 2,038.1 | 2,055.4 | 2,207.1 | | Current Assets | 2,251.3 | 2,079.8 | 1,951.8 | | Current Liabilities | 1,439.0 | 1,632.2 | 1,416.1 | | Cash and cash equivalents | 174.0 | 175.6 | 150.9 | | Receivables, net | 1,107.3 | 1,007.8 | 907.4 | | Inventories, net | 875.2 | 823.5 | 823.9 | | Current installments of long-term debt | 19.2 | 129.0 | 80.9 | | Long-term debt | 3,016.6 | 2,713.2 | 2,684.8 | Condensed Statements of Operations Statements of Operations Summary | Metric | Three Months Ended March 31, 2025 ($ in millions) | Three Months Ended March 31, 2024 ($ in millions) | Change (YoY) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Sales | 1,644.2 | 1,635.3 | +0.5% | | Cost of goods sold | 1,495.5 | 1,428.0 | +4.7% | | Operating income | 43.7 | 97.3 | -55.1% | | Interest expense | 48.5 | 44.6 | +8.7% | | Income before taxes | 2.1 | 60.3 | -96.5% | | Income tax provision | 0.9 | 12.5 | -92.8% | | Net income | 1.2 | 47.8 | -97.5% | | Net income attributable to Olin Corporation | 1.4 | 48.6 | -97.1% | | Basic EPS | 0.01 | 0.41 | -97.6% | | Diluted EPS | 0.01 | 0.40 | -97.5% | Condensed Statements of Comprehensive Income Comprehensive Income Summary | Metric | Three Months Ended March 31, 2025 ($ in millions) | Three Months Ended March 31, 2024 ($ in millions) | Change (YoY) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Net income | 1.2 | 47.8 | -97.5% | | Total other comprehensive income, net of tax | 19.5 | 6.6 | +195.5% | | Comprehensive income | 20.7 | 54.4 | -61.9% | | Comprehensive income attributable to Olin Corporation | 20.9 | 55.2 | -62.2% | Condensed Statements of Shareholders' Equity Shareholders' Equity Summary | Metric | March 31, 2025 ($ in millions) | March 31, 2024 ($ in millions) | Change (YoY) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Common Stock | 115.1 | 119.4 | -3.6% | | Accumulated Other Comprehensive Loss | (430.6) | (489.7) | +12.0% | | Retained Earnings | 2,321.5 | 2,542.3 | -8.6% | | Olin Corporation's Shareholders' Equity | 2,006.0 | 2,172.0 | -7.7% | | Total Equity | 2,038.1 | 2,207.1 | -7.6% | | Common stock repurchased and retired | (0.7) shares / (20.2) $ | (2.0) shares / (105.4) $ | -65.0% shares / -80.8% $ | | Dividends declared per share | 0.20 | 0.20 | 0.0% | Condensed Statements of Cash Flows Cash Flow Summary | Metric | Three Months Ended March 31, 2025 ($ in millions) | Three Months Ended March 31, 2024 ($ in millions) | Change (YoY) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Net operating activities | (86.0) | 81.0 | -206.2% | | Net investing activities | (62.4) | (74.7) | +16.5% | | Net financing activities | 146.6 | (25.3) | +679.8% | | Net decrease in cash and cash equivalents | (1.6) | (19.4) | +91.8% | | Cash and cash equivalents, end of period | 174.0 | 150.9 | +15.3% | | Capital expenditures | (61.4) | (44.3) | -38.6% | | Long-term debt borrowings, net | 199.9 | 94.7 | +111.1% | | Common stock repurchased and retired | (20.2) | (105.4) | +80.8% | Notes to Condensed Financial Statements Detailed disclosures supporting financial statements, covering business, accounting, and financial instruments NOTE 1. DESCRIPTION OF BUSINESS - Olin operates in three capital-intensive business segments: Chlor Alkali Products and Vinyls (chlorine, caustic soda, etc.), Epoxy (epoxy materials and precursors), and Winchester (sporting and military ammunition)[17] NOTE 2. RECENT ACCOUNTING PRONOUNCEMENTS - FASB issued ASU 2024-03 (Expense Disaggregation Disclosures) effective for annual periods after December 15, 2026, and ASU 2023-09 (Income Tax Disclosures) effective for annual periods after December 15, 2024[19][20] - Neither ASU is expected to impact the Company's consolidated financial statements, but will expand disclosure requirements[19][20] NOTE 3. ACQUISITIONS - Olin acquired AMMO, Inc.'s small caliber ammunition manufacturing assets for $55.8 million on April 18, 2025[21] - The acquisition, including brass shellcase capabilities and a 185,000 sq ft production facility in Manitowoc, WI, will be included in the Winchester segment[21] NOTE 4. RESTRUCTURING CHARGES Restructuring Charges by Plan | Restructuring Plan | Q1 2025 Pretax Charges ($ in millions) | Q1 2024 Pretax Charges ($ in millions) | | :----------------------- | :------------------------------------- | :------------------------------------- | | Epoxy Optimization Plan | 1.1 | 3.5 | | McIntosh Plan | 0.2 | 1.9 | | Freeport 2021 Plan | 1.8 | 0.4 | | Freeport 2019 Plan | 0.9 | 2.5 | | Total | 4.0 | 8.3 | - Olin expects additional restructuring charges of approximately $35 million through 2030 related to the Freeport 2024 Plan (Chlorine 3 facility closure) and $10 million through year-end for the Epoxy Optimization Plan[22][24] Cumulative Restructuring Charges | Component | Cumulative Charges through March 31, 2025 ($ in millions) | | :-------------------------------- | :------------------------------------------ | | Write-off of equipment and facility | 79.9 | | Employee severance and related benefit costs | 20.6 | | Facility exit costs | 89.5 | | Lease and other contract termination costs | 40.4 | | Total cumulative restructuring charges | 230.4 | NOTE 5. EARNINGS PER SHARE Earnings Per Share Summary | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | Change (YoY) | | :------------------------------------ | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Net income attributable to Olin Corporation | $1.4 million | $48.6 million | -97.1% | | Basic EPS | $0.01 | $0.41 | -97.6% | | Diluted EPS | $0.01 | $0.40 | -97.5% | | Weighted-average common shares - basic | 115.3 million | 119.9 million | -3.8% | | Weighted-average common shares - diluted | 116.6 million | 121.9 million | -4.3% | NOTE 6. ACCOUNTS RECEIVABLE Accounts Receivable Details | Metric | March 31, 2025 ($ in millions) | December 31, 2024 ($ in millions) | March 31, 2024 ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Receivables, net | 1,107.3 | 1,007.8 | 907.4 | | Allowance for doubtful accounts receivable | 12.0 | 11.8 | 12.6 | | Other receivables | 101.7 | 94.6 | 89.4 | NOTE 7. INVENTORIES Inventories Breakdown | Metric | March 31, 2025 ($ in millions) | December 31, 2024 ($ in millions) | March 31, 2024 ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Inventories, net | 875.2 | 823.5 | 823.9 | | Supplies | 157.7 | 149.3 | 146.7 | | Raw materials | 183.0 | 185.2 | 188.2 | | Work in process | 188.9 | 173.1 | 160.8 | | Finished goods | 503.4 | 467.3 | 473.9 | | LIFO reserve | (157.8) | (151.4) | (145.7) | NOTE 8. OTHER ASSETS Other Assets Details | Metric | March 31, 2025 ($ in millions) | December 31, 2024 ($ in millions) | March 31, 2024 ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Other assets | 1,171.6 | 1,185.1 | 1,123.5 | | Supply contracts | 1,027.1 | 1,047.3 | 1,065.1 | | Pension assets | 52.0 | 43.3 | 1.7 | | Investment in unconsolidated affiliates | 23.0 | 23.0 | — | - Amortization expense related to long-term supply contracts was $20.9 million in Q1 2025, up from $18.3 million in Q1 2024[36] NOTE 9. GOODWILL AND INTANGIBLE ASSETS Goodwill and Intangible Assets Summary | Metric | March 31, 2025 ($ in millions) | December 31, 2024 ($ in millions) | March 31, 2024 ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Goodwill | 1,423.5 | 1,423.6 | 1,423.3 | | Total intangible assets, net | 198.6 | 206.6 | 235.6 | | Customers, customer contracts and relationships, net | 190.3 | 197.5 | 224.7 | NOTE 10. DEBT Debt Structure Overview | Debt Type | March 31, 2025 ($ in millions) | December 31, 2024 ($ in millions) | March 31, 2024 ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Total debt | 3,035.8 | 2,842.2 | 2,765.7 | | Long-term debt | 3,016.6 | 2,713.2 | 2,684.8 | | 9.50% senior notes, due 2025 | — | 108.6 | 108.6 | | 5.125% senior notes, due 2027 | — | 500.0 | 500.0 | | 6.625% senior notes, due 2033 | 600.0 | — | — | | Term Loan Facilities | 650.0 | 332.5 | 339.0 | | Revolving Credit Facilities | 75.0 | 170.0 | 161.0 | | Receivables Financing Agreements | 461.0 | 475.0 | 332.4 | - On March 14, 2025, Olin issued $600.0 million of 6.625% senior notes due 2033 and entered into a new $1,850.0 million senior credit facility, increasing borrowing limits and extending maturity to March 14, 2030[40][41] - Proceeds from new debt were used to redeem $108.6 million of 2025 Notes and $500.0 million of 2027 Notes, and refinance the existing 2022 Senior Credit Facility[44] - Olin was in compliance with all debt covenants as of March 31, 2025[45] NOTE 11. PENSION PLANS AND RETIREMENT BENEFITS Net Periodic Pension Benefit Costs | Metric | Three Months Ended March 31, 2025 ($ in millions) | Three Months Ended March 31, 2024 ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | | Net periodic pension benefit (income) cost | (5.0) | (6.1) | | Service cost (pension) | 1.0 | 1.3 | | Interest cost (pension) | 24.5 | 25.1 | | Expected return on plans' assets (pension) | (31.7) | (33.9) | | Net periodic postretirement benefit (income) cost | 0.4 | 0.8 | - Olin made $0.1 million in cash contributions to international qualified defined benefit pension plans in Q1 2025[55] NOTE 12. INCOME TAXES Income Tax Provision and Rate | Metric | Three Months Ended March 31, 2025 ($ in millions) | Three Months Ended March 31, 2024 ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | | Income tax provision | 0.9 | 12.5 | | Effective tax rate (excluding specific items) | 23.8% | 25.0% | Unrecognized Tax Benefits | Unrecognized Tax Benefits | March 31, 2025 ($ in millions) | March 31, 2024 ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | | Balance at end of period | 21.3 | 49.9 | - Olin expects a decrease of approximately $10.3 million in unrecognized tax benefits over the next twelve months due to expected settlements and expiration of statutes of limitation[58] NOTE 13. DEFINED CONTRIBUTION PLAN Defined Contribution Plan Expense | Metric | Three Months Ended March 31, 2025 ($ in millions) | Three Months Ended March 31, 2024 ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | | Company Contribution | 10.3 | 10.6 | | Company Match | 4.2 | 3.6 | | Total expense | 14.5 | 14.2 | NOTE 14. STOCK-BASED COMPENSATION Stock-Based Compensation Expense | Metric | Three Months Ended March 31, 2025 ($ in millions) | Three Months Ended March 31, 2024 ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | | Stock-based compensation expense | 5.3 | 5.6 | | Mark-to-market adjustments | (3.8) | 2.2 | | Total expense | 1.5 | 7.8 | Stock-Based Awards Granted | Award Type | Q1 2025 Grants | Q1 2024 Grants | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | | Performance share awards granted | 545,572 | 180,714 | | Restricted stock units granted | 398,303 | 202,500 | | Stock options granted | 0 | 601,157 | NOTE 15. SHAREHOLDERS' EQUITY Common Stock Repurchase Summary | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | | Common stock repurchased and retired (shares) | 0.7 million | 2.0 million | | Common stock repurchased and retired (value) | $20.2 million | $105.4 million | | Remaining repurchase authorization | $1,978.9 million | N/A | Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss | January 1, 2025 ($ in millions) | March 31, 2025 ($ in millions) | Net Change ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Balance | (450.1) | (430.6) | 19.5 | | Unrealized (losses) gains (cash flow hedges) | N/A | 34.4 | N/A | NOTE 16. SEGMENT INFORMATION Segment Sales and Income Before Taxes | Segment | Q1 2025 Sales ($ in millions) | Q1 2024 Sales ($ in millions) | Q1 2025 Income (Loss) Before Taxes ($ in millions) | Q1 2024 Income (Loss) Before Taxes ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :------------------------------------------------- | :------------------------------------------------- | | Chlor Alkali Products and Vinyls | 924.5 | 884.6 | 78.3 | 76.6 | | Epoxy | 331.7 | 341.3 | (28.4) | (11.8) | | Winchester | 388.0 | 409.4 | 22.8 | 72.2 | | Total Sales | 1,644.2 | 1,635.3 | N/A | N/A | | Total Income Before Taxes | N/A | N/A | 2.1 | 60.3 | Segment Sales by Geography (Q1 2025) | Segment Sales by Geography (Q1 2025) | United States ($ in millions) | Europe ($ in millions) | Other Foreign ($ in millions) | Total ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Chlor Alkali Products and Vinyls | 646.9 | 33.2 | 244.4 | 924.5 | | Epoxy | 144.1 | 101.8 | 85.8 | 331.7 | | Winchester | 346.2 | 12.6 | 29.2 | 388.0 | | Total Sales | 1,137.2 | 147.6 | 359.4 | 1,644.2 | NOTE 17. ENVIRONMENTAL Environmental Liabilities | Metric | March 31, 2025 ($ in millions) | December 31, 2024 ($ in millions) | March 31, 2024 ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Reserves for future environmental expenditures | 157.0 | 156.5 | 154.8 | | Classified as other noncurrent liabilities | 127.0 | 126.5 | 122.8 | - Environmental provisions charged to income were $5.0 million in Q1 2025, compared to $5.8 million in Q1 2024[78][146] NOTE 18. COMMITMENTS AND CONTINGENCIES Accrued Liabilities for Legal Actions | Metric | March 31, 2025 ($ in millions) | December 31, 2024 ($ in millions) | March 31, 2024 ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Accrued liabilities for other legal actions | 17.1 | 19.7 | 17.7 | - Olin does not believe that current legal actions will materially adversely affect its financial position, cash flows, or results of operations[80] NOTE 19. DERIVATIVE FINANCIAL INSTRUMENTS - Olin uses futures, forward, commodity swaps, and put/call option contracts to reduce commodity price fluctuations and forward sales/purchase contracts to manage currency risk[83][84] Derivative Financial Instruments Summary | Metric | March 31, 2025 ($ in millions) | December 31, 2024 ($ in millions) | March 31, 2024 ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Total derivative assets | 36.5 | 16.5 | 10.9 | | Total derivative liabilities | 1.2 | 3.7 | 25.7 | | Notional Value - Commodity | 153.4 | 204.5 | 239.9 | Effect of Cash Flow Hedges on Operations | Effect on Statements of Operations (Cash Flow Hedges) | Q1 2025 Gain (Loss) ($ in millions) | Q1 2024 Gain (Loss) ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | | Commodity contracts (Other comprehensive income) | 34.4 | (3.0) | | Commodity contracts (Cost of goods sold) | 8.1 | (13.3) | | Foreign exchange contracts (Selling and administrative) | (7.0) | 0.8 | NOTE 20. FAIR VALUE MEASUREMENTS - Commodity and foreign currency contract financial instruments are valued as Level 2 under the fair value measurements hierarchy, based on observable market prices[101][102] Fair Value Measurements of Debt | Metric | March 31, 2025 ($ in millions) | December 31, 2024 ($ in millions) | March 31, 2024 ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Fair value measurements of debt | 2,982.4 | 2,779.0 | 2,725.7 | | Carrying value of total debt | 3,035.8 | 2,842.2 | 2,765.7 | ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Analysis of Olin's Q1 2025 financial performance, condition, segment results, outlook, and liquidity Business Background - Olin is a vertically integrated global manufacturer of chemical products and a leading U.S. manufacturer of ammunition[105] - The company operates in three capital-intensive business segments: Chlor Alkali Products and Vinyls, Epoxy, and Winchester[105] Executive Summary Olin's Q1 2025 net income significantly decreased, with varied segment performance and strategic debt refinancing Key Financial Highlights | Metric | Q1 2025 ($ in millions) | Q1 2024 ($ in millions) | Change (YoY) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Net income | 1.4 | 48.6 | -97.1% | | Diluted net income per share | 0.01 | 0.40 | -97.5% | - Chlor Alkali Products and Vinyls segment income slightly increased due to higher volumes, partially offset by lower pricing and higher costs[108] - Epoxy segment reported a larger loss due to higher operating costs and weak global demand, exacerbated by subsidized Asian competition[109] - Winchester segment income decreased significantly due to lower commercial sales, higher commodity/operating costs, and lower pricing, partially offset by higher military sales[110] - Olin repurchased $20.2 million of common stock in Q1 2025 and completed a major debt refinancing, issuing $600.0 million in new notes and expanding its senior credit facility[111][112][113][114] - On April 18, 2025, Olin acquired AMMO, Inc.'s small caliber ammunition manufacturing assets for $55.8 million, integrating them into the Winchester segment[116] Consolidated Results of Operations Olin's Q1 2025 sales slightly increased, but gross margin and net income significantly declined year-over-year Consolidated Financial Performance | Metric | Q1 2025 ($ in millions) | Q1 2024 ($ in millions) | Change (YoY) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Sales | 1,644.2 | 1,635.3 | +1% | | Gross margin | 148.7 | 207.3 | -28.3% | | Gross margin as % of sales | 9% | 13% | -4 ppts | | Operating income | 43.7 | 97.3 | -55.1% | | Net income attributable to Olin Corporation | 1.4 | 48.6 | -97.1% | - Selling and administrative expenses decreased slightly by $0.9 million, primarily due to lower stock-based compensation, including mark-to-market adjustments[120] - Restructuring charges decreased to $4.0 million from $8.3 million, mainly due to lower facility exit cost activities[121] - Interest expense increased by $3.9 million, including a $3.3 million write-off of deferred debt issuance costs related to Q1 financing transactions[122] - Non-operating pension income decreased due to a lower assumption for the long-term rate of return on plan assets[123] Segment Results Chlor Alkali Products and Vinyls income slightly rose, Epoxy loss widened, and Winchester income significantly decreased Segment Performance Overview | Segment | Q1 2025 Sales ($ in millions) | Q1 2024 Sales ($ in millions) | YoY Change (%) | Q1 2025 Segment Income (Loss) ($ in millions) | Q1 2024 Segment Income (Loss) ($ in millions) | YoY Change ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | :------------------------------------------------- | :------------------------------------------------- | :------------------------------------------------- | | Chlor Alkali Products and Vinyls | 924.5 | 884.6 | +5% | 78.3 | 76.6 | +1.7 | | Epoxy | 331.7 | 341.3 | -3% | (28.4) | (11.8) | -16.6 | | Winchester | 388.0 | 409.4 | -5% | 22.8 | 72.2 | -49.4 | - Chlor Alkali Products and Vinyls sales increase was primarily due to higher volumes, partially offset by lower EDC pricing[128] - Epoxy segment loss was exacerbated by higher operating costs, lower product pricing, and weak global demand, particularly from subsidized Asian competition[132] - Winchester's decline was due to lower commercial ammunition sales and pricing, and higher commodity/operating costs, partially offset by increased military sales[134][135] - Corporate/Other costs decreased by $5.8 million, mainly due to lower variable incentive compensation and favorable foreign currency impact[138] Outlook Q2 2025 chemical business results are expected to be comparable to Q1, with Winchester improving due to seasonal demand - Q2 2025 operating results for Chemical businesses are expected to be comparable to Q1 2025, with Chlor Alkali Products and Vinyls anticipating seasonal volume improvements and strengthened caustic soda values[142] - Winchester business Q2 2025 results are expected to improve from Q1 2025 due to seasonally stronger commercial demand and higher military sales[142] Full Year 2025 Estimates | Metric (Full Year 2025 Estimates) | Range ($ in millions) | | :------------------------------------ | :---------------------------------------------- | | Capital spending | 200 - 220 | | Depreciation and amortization expense | ~525 | | Environmental expenses | 25 - 35 | | Non-operating pension income | Lower than $26.0 (2024) | | Effective tax rate | 25% - 30% | | Cash taxes paid | 175 - 200 | Environmental Matters Olin's environmental provisions and liabilities are detailed, with estimated spending for investigatory and remedial efforts Environmental Spending and Liabilities | Metric | Q1 2025 ($ in millions) | Q1 2024 ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | | Environmental provisions charged to income | 5.0 | 5.8 | | Remedial and investigatory spending | (4.5) | (4.6) | | Environmental Liabilities (end of period) | 157.0 | 154.8 | - Olin estimates approximately $30 million in spending for investigatory and remedial efforts in 2025[146] - Accrued liabilities for unasserted claims amounted to $11.6 million at March 31, 2025[147] Legal Matters and Contingencies Accrued liabilities for legal actions are reported, with no material adverse impact expected on financial position Accrued Liabilities for Legal Actions | Metric | March 31, 2025 ($ in millions) | December 31, 2024 ($ in millions) | March 31, 2024 ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Accrued liabilities for other legal actions | 17.1 | 19.7 | 17.7 | - Olin does not believe that current legal actions will materially adversely affect its financial position, cash flows, or results of operations[80] Liquidity and Capital Resources Olin's Q1 2025 saw negative operating cash flow, significant debt refinancing, and substantial stock repurchase authorization Cash Flow Activities | Metric | Q1 2025 ($ in millions) | Q1 2024 ($ in millions) | Change (YoY) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Net operating activities | (86.0) | 81.0 | -206.2% | | Capital expenditures | (61.4) | (44.3) | -38.6% | | Net financing activities | 146.6 | (25.3) | +679.8% | | Long-term debt borrowings, net | 199.9 | 94.7 | +111.1% | | Common stock repurchased and retired | (20.2) | (105.4) | +80.8% | - Working capital increased by $204.4 million in Q1 2025, compared to an $89.0 million increase in Q1 2024, contributing to negative operating cash flow[151] - Olin completed significant debt refinancing in Q1 2025, including issuing $600.0 million in 2033 Notes and entering a new $1,850.0 million senior credit facility, to redeem existing notes and refinance facilities[161][162][165] - The company had $1,124.6 million available under its 2025 Revolving Credit Facility and $39.0 million additional borrowing capacity under the 2024 Receivables Financing Agreement as of March 31, 2025[164][168] - Total debt to total capitalization increased to 59.8% as of March 31, 2025, from 58.0% as of December 31, 2024[157] - Olin has $1,978.9 million remaining authorized for common stock repurchases under its 2022 and 2024 programs[173] ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Olin's exposure to market risks from commodity prices, foreign currency, and interest rates, and hedging strategies - Olin is exposed to market risks from commodity price volatility (electricity, natural gas, raw materials), foreign currency exchange rates (primarily Euro), and interest rate changes[177][178][179][180] Market Risk Exposure Summary | Metric | March 31, 2025 ($ in millions) | December 31, 2024 ($ in millions) | March 31, 2024 ($ in millions) | | :------------------------------------ | :---------------------------------------------- | :---------------------------------------------- | :---------------------------------------------- | | Notional value of open commodity contracts | 153.4 | 204.5 | 239.9 | | Variable-rate long-term debt | 1,271.9 | 1,063.4 | 988.4 | - A hypothetical 10% increase in hedged commodity prices would result in a $15.3 million increase in cost of inventory purchased, substantially offset by hedging instruments[178] - A hypothetical 100-basis point change in SOFR would impact annual interest expense by $12.7 million, based on variable-rate debt levels at March 31, 2025[181] ITEM 4. CONTROLS AND PROCEDURES CEO and CFO concluded disclosure controls were effective, with no material changes in internal control - Olin's CEO and CFO evaluated and concluded that disclosure controls and procedures were effective as of March 31, 2025[183] - No material changes in internal control over financial reporting occurred during Q1 2025[184] Cautionary Statement Regarding Forward-Looking Statements The report contains forward-looking statements subject to risks, uncertainties, and potential material differences in actual outcomes - The report contains forward-looking statements identified by words like "anticipate," "expect," "believe," and "outlook," which are not guarantees of future performance[185][186] - Actual outcomes and results may differ materially due to various risks and uncertainties, including economic conditions, pricing, cost control, supply chain, operational interruptions, and regulatory changes[186][190] - The payment of cash dividends is at the discretion of the Board of Directors and may change based on current conditions[186] PART II — OTHER INFORMATION Disclosures on legal proceedings, risk factors, equity sales, defaults, mine safety, and filed exhibits ITEM 1. LEGAL PROCEEDINGS Legal proceedings and contingencies are discussed in Note 18, 'Commitments and Contingencies' - Legal proceedings and contingencies are discussed in Note 18, 'Commitments and Contingencies'[191] ITEM 1A. RISK FACTORS No new material risk factors reported for the quarter, referring to the Annual Report on Form 10-K - No new material risk factors are reported for the quarter, referring to the Annual Report on Form 10-K for existing risk factors[191] ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS Olin repurchased common stock in Q1 2025, with significant authorization remaining for future repurchases Common Stock Repurchase Activity | Period | Total Number of Shares Purchased | Average Price Paid per Share | | :-------------------- | :------------------------------- | :--------------------------- | | January 1-31, 2025 | 294,406 | $33.99 | | February 1-28, 2025 | 355,465 | $28.15 | | March 1-31, 2025 | — | — | | Total (Q1 2025) | 649,871 | N/A | - As of March 31, 2025, $1,978.9 million of common stock remained authorized for repurchase under the 2022 and 2024 Repurchase Authorization programs[192] ITEM 3. DEFAULTS UPON SENIOR SECURITIES No defaults upon senior securities were reported for the period - No defaults upon senior securities were reported for the period[193] ITEM 4. MINE SAFETY DISCLOSURES No mine safety disclosures were reported for the period - No mine safety disclosures were reported for the period[194] ITEM 5. OTHER INFORMATION No director or officer adopted, terminated, or modified Rule 10b5-1 or non-Rule 10b5-1 trading arrangements - No director or officer adopted, terminated, or modified a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the three months ended March 31, 2025[197] ITEM 6. EXHIBITS Exhibits include a Third Amendment to Forward Purchase Agreement and Section 302 and 906 Certification Statements - Exhibits include a Third Amendment to Forward Purchase Agreement, Section 302 and 906 Certification Statements, and XBRL Interactive Data Files[198] SIGNATURES The report was signed by Todd A. Slater, Senior Vice President and Chief Financial Officer, on May 2, 2025 - The report was signed by Todd A. Slater, Senior Vice President and Chief Financial Officer, on May 2, 2025[203]