Olin(US:OLN)2026-02-20 14:49Financial Performance - Chlor Alkali Products and Vinyls segment represented 54% of 2025 sales, Epoxy segment 20%, and Winchester segment 26%[9] - The estimated backlog as of January 31, 2026, was approximately $1,331 million, with 81% expected to be fulfilled during 2026[51] - In 2025, approximately 59% of the Epoxy segment's sales were generated outside of the U.S.[47] - Olin's Chlor Alkali Products and Vinyls segment generated 31% of its sales outside the U.S. in 2025[47] - Winchester's contracts with the U.S. military accounted for approximately 13% of total sales in 2025[50] Operational Initiatives - Cost management initiatives focus on optimizing asset strategy and productivity to maximize returns to the Electrochemical Unit (ECU)[24] - The company aims to leverage its diverse chlor alkali derivatives portfolio to enhance value from the entire ECU[23] - The Epoxy segment aims to expand market participation in higher value add platform products[34] - Olin's Epoxy segment is focused on driving cost improvements across the supply chain to optimize EPI and LER cost positions in the Americas and Europe[33] Joint Ventures and Acquisitions - The joint venture Blue Water Alliance (BWA) with Mitsui began operations in 2023, but will end by the end of 2025 to focus on long-term structural opportunities[18] - A new joint venture, Hidrogenii, LLC, was launched in 2024 with Plug Power, focusing on hydrogen production, starting with a 15-ton-per-day liquefaction plant[19] - Olin acquired AMMO, Inc.'s small caliber ammunition manufacturing assets for $55.8 million on April 18, 2025[36] - On October 1, 2023, Olin acquired White Flyer Targets, LLC for $63.5 million, enhancing its position in the recreational shooting market[37] Employee Engagement and Development - As of December 31, 2025, Olin had a total of 7,849 employees, with 86% located in the United States[62] - In 2025, Olin employees volunteered over 56,000 hours to various organizations and causes[58] - The company provided over 4,500 recognition awards and 9,000 peer-to-peer recognitions in 2025[59] - Olin's commitment to employee development includes tuition assistance of up to $10,000 per year for eligible employees[61] Financial Risk Management - Olin's long-term borrowings as of December 31, 2025, totaled $2,827.3 million, with $1,060.8 million issued at variable rates[308] - The company maintained open positions on commodity contracts with a notional value of $218.6 million as of December 31, 2025[305] - A hypothetical 10% increase in commodity prices would lead to a $21.9 million increase in inventory costs, offset by related hedging instruments[306] - Unfavorable currency movements of 10% would negatively affect the fair values of derivatives by $13.4 million[307] - A hypothetical change of 100-basis points in the secured overnight financing rate (SOFR) would impact annual interest expense by $10.6 million, assuming no changes in the $1,060.8 million of variable-rate debt levels from December 31, 2025[309] - The company does not enter into any derivative financial instruments for speculative purposes, indicating a conservative approach to financial risk management[310] Environmental and Regulatory Considerations - The company is subject to environmental charges totaling $25.5 million for investigatory and remedial efforts in 2025[69] Forward-Looking Statements and Risks - Forward-looking statements in the report involve risks and uncertainties that could lead to actual outcomes differing materially from those expressed[311] - The company anticipates potential changes in its dividend policy, which will be determined by the Board of Directors based on current conditions, including earnings and financial conditions[312] - Risks and uncertainties affecting forward-looking statements include those discussed under Item 1A — "Risk Factors," which should be considered when evaluating the company's future performance[313]