Financial Data and Key Metrics Changes - Consolidated adjusted EBITDA for Q4 was $3.2 million, down from $6 million the prior year, driven by a pause in customer orders due to new global tariffs [4] - Full year consolidated adjusted EBITDA was $29.2 million, an improvement from the prior year [4][22] - Net sales for Q4 were $108.8 million, an increase of $7.8 million compared to Q4 2024, while full year net sales were $434.2 million, up $3.8 million from the prior year [21] Business Line Data and Key Metrics Changes - Air and Liquid Processing segment achieved record revenue and adjusted EBITDA in 2025, with Q4 revenue 10% higher than the prior year and full year revenue 7% above the prior year [6][7] - Forged and Cast Engineered Products (FCEP) reported Q4 net sales of $70.9 million, up from $66.5 million in Q4 2024, and full year net sales of $292.6 million, stable compared to $286.6 million in the prior year [12] - FCEP adjusted EBITDA for Q4 was $2.2 million, down from $5.5 million in the prior year, while full year adjusted EBITDA was $24.4 million [13] Market Data and Key Metrics Changes - Backlog for Air and Liquid declined by $8 million year-over-year, primarily due to the U.S. Navy's termination of the Constellation-class frigate program [8] - Significant order activity was noted at the start of 2026, with bookings up 73% compared to the prior year [8] - Demand for heat exchangers in the nuclear market reached record levels, indicating long-term growth potential [9] Company Strategy and Development Direction - The company initiated the removal of underperforming assets to improve adjusted EBITDA by $7-$8 million annually [4] - Focus on optimizing the Sweden facility and ramping up production to meet expected market growth [13][15] - Anticipation of significant margin expansion in the second half of 2026 and full year 2027 due to operational improvements and tariff protections [17] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about emerging from the steel market slowdown and improving profitability in 2026 [52] - The company noted that the roll market is recovering, and shutdown costs are behind them [25] - Management highlighted strong demand in the nuclear and AI data center markets, positioning the company for growth [10][9] Other Important Information - The company recorded significant one-time charges related to the exit from unprofitable operations, totaling $42.4 million in Q4 and $52.2 million for the full year [19] - The pension plan achieved fully funded status in early 2026, enhancing the company's liquidity position [24] Q&A Session Summary Question: Inquiry about Air and Liquid Processing margins - Management indicated that Q4 margins were affected by an unusual mix, and the full year is more representative of typical performance [29] Question: Clarification on customer behavior changes in Forged and Cast rolls - Management explained that customer behavior was impacted by tariff calculations, leading to a pause in orders, but demand is now recovering [32][34] Question: Involvement with Westinghouse's AP1000 reactors - Management confirmed past supply to Westinghouse and noted positive indicators for future activity in the nuclear market [46][48]

Group 1: Company Performance - The backlog declined by $8 million year over year, mainly due to the U.S. Navy's termination of the Constellation frigate program, which removed $7.1 million in orders from the backlog [1] - In 2025, Air and Liquid achieved record revenue and adjusted EBITDA, with Q4 revenue up 10% year over year and full-year revenue up 7% [2][3] - The consolidated adjusted EBITDA for the full year was $29.2 million, an increase from the previous year despite revenue impacts from FCEP [3][16] Group 2: Market Demand and Orders - Significant order activity was noted at the start of 2026, with bookings for the U.S. Navy exceeding $9 million, replacing the lost orders from the frigate program [5] - Demand for heat exchangers in the nuclear market reached record levels in 2025, indicating long-term growth potential [5][6] - The commercial pump market is experiencing high demand due to the AI data center market, with bookings for commercial pumps at a record high in 2025 [6] Group 3: Financial Adjustments and Challenges - The Forged and Cast Engineered Products Division reported net sales of $70.9 million in Q4 2025, with full-year sales of $292.6 million, reflecting stable performance [8] - FCEP faced an operating loss of $44.7 million for the full year, primarily due to one-time exit costs, including a $41.4 million deconsolidation charge from the closure of the U.K. facility [8][9] - Adjusted EBITDA for FCEP was $24.4 million for the full year, with a decrease in Q4 adjusted results attributed to fewer operating days and higher production costs [9][10] Group 4: Future Outlook - The company expects improved profitability as it emerges from the steel market slowdown, with strategic actions taken in Q4 anticipated to yield positive results in 2026 [31] - The operational roadmap for the Sweden facility aims for a production level approximately 20% higher than 2025 by 2026, with a focus on optimizing operations [10][12] - The U.S. market is showing signs of recovery, with expectations for improved volumes and higher demand for rolled products in 2027 [12][19]

Financial Data and Key Metrics Changes - Consolidated adjusted EBITDA for Q4 2025 was $3.2 million, down from $6 million in the prior year, primarily due to a pause in customer orders in the forged and cast segment after new global tariffs were announced [4] - Full year consolidated adjusted EBITDA was $29.2 million, an increase of $1.1 million compared to the prior year, marking the third consecutive year of growth [21] - Net sales for Q4 2025 were $108.8 million, an increase of $7.8 million compared to Q4 2024, while full year net sales were $434.2 million, up $3.8 million from the previous year [20] Business Line Data and Key Metrics Changes - The Air and Liquid Processing segment achieved record revenue and adjusted EBITDA in 2025, with Q4 revenue up 10% year-over-year and full year revenue up 7% [6] - The Forged and Cast Engineered Products (FCEP) division reported Q4 net sales of $70.9 million, compared to $66.5 million in Q4 2024, and full year sales of $292.6 million, stable compared to $286.6 million in the prior year [12] Market Data and Key Metrics Changes - Backlog for the Air and Liquid segment declined by $8 million year-over-year, primarily due to the U.S. Navy's termination of the Constellation-class frigate program [7] - Significant order activity was noted at the start of 2026, with bookings up 73% compared to the prior year [7] Company Strategy and Development Direction - The company initiated the removal of underperforming assets to improve adjusted EBITDA by $7-$8 million annually [4] - The focus for FCEP is on optimizing the Sweden facility and ramping up production, with expectations for a 20% increase in production levels by Q3 2026 [14][16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about improved profitability as the company emerges from the steel market slowdown, anticipating better results in 2026 [50] - The nuclear market continues to show strong activity, with expectations for growth in demand for heat exchangers and other products [10][46] Other Important Information - The company recorded significant one-time charges related to the exit from unprofitable operations, including a $42.4 million deconsolidation charge in Q4 [18] - The pension plan achieved fully funded status in early 2026, which is expected to positively impact the company's financial position [22] Q&A Session Summary Question: Insights on Air and Liquid Processing margins - Management indicated that the full year margins are more representative of typical performance, with Q4 being affected by an unusual mix of orders [28] Question: Changes in customer behavior regarding forged and cast rolls - Management explained that customer behavior was impacted by uncertainty around tariffs, but demand is now recovering as pricing stabilizes [31][32] Question: Involvement with Westinghouse's AP1000 reactors - Management confirmed past supply to Westinghouse and noted ongoing activity in the nuclear market, which is expected to ramp up [43][46]

Core Viewpoint - Ampco-Pittsburgh Corporation is transitioning from a multi-year reset with a streamlined business model, improved pricing discipline, and increased exposure to resilient end markets, leading to a fundamentally enhanced earnings base [1] Group 1: Business Strategy and Operations - The company has exited unprofitable operations, including the U.K. cast roll facility and a small steel distribution operation, which has improved its earnings outlook by eliminating recurring losses [4][5] - Management has successfully passed tariff-related costs to customers in the Forged and Cast Engineered Products segment, preserving margins despite trade policy uncertainties [2][3] - The Air and Liquid Processing (ALP) segment is benefiting from strong demand in pharmaceuticals, nuclear infrastructure, and defense, providing a more stable revenue mix [6][7] Group 2: Financial Performance and Valuation - Despite operational improvements, Ampco-Pittsburgh's stock valuation remains low compared to peers, trading at a fraction of peer multiples on sales and book value [9][10] - Pro-forma earnings indicate potential for significant growth in adjusted EBITDA as cost savings from exited businesses materialize and ALP performance strengthens [10] - The market has not yet fully recognized the durability of Ampco-Pittsburgh's reshaped portfolio, as valuation metrics have remained near historical lows [9][14] Group 3: Market Dynamics and Future Outlook - The company is positioned to deliver steadier earnings with reduced downside volatility, supported by a focused operating base and strong end-market demand [13][14] - The ALP segment's focus on engineered products tied to long-term investment cycles enhances the company's strategic direction and growth visibility [6][13]