Core Viewpoint - Pomerantz Law Firm is investigating claims on behalf of investors of Arq, Inc. due to potential securities fraud or unlawful business practices following disappointing financial results and operational decisions [1] Financial Performance - Arq, Inc. reported a GAAP loss per share of $1.20 for Q4 and full year 2025, missing analyst estimates by $1.14 [1] - The company provided 2026 revenue guidance of $120 million to $125 million, significantly below the consensus estimate of $136.9 million [1] Operational Decisions - The CEO announced a pause in the granular activated carbon production project to conduct a comprehensive review of engineering and production processes, with no firm timeline for completion [1] Market Reaction - Following the financial disclosures, Arq's stock price dropped by $1.56 per share, a decline of 48.75%, closing at $1.64 per share on March 10, 2026 [1]

Core Viewpoint - Johnson Fistel, PLLP is investigating potential claims on behalf of investors of Arq, Inc. due to significant setbacks related to its granular activated carbon facility, which may have led to investor losses under federal securities laws [1][6]. Company Developments - On March 9, 2026, Arq, Inc. announced that its GAC production and development had been paused, and the Corbin, Kentucky facility had been idled [3]. - The facility's thermal oxidizer emissions control system limited production capacity to approximately 15 million pounds annually, leading to a recorded impairment charge of $44.8 million related to the Corbin assets [4]. - Arq is currently engaged in litigation with the engineering consultant responsible for the plant's design [4]. Financial Guidance - Arq's 2026 financial guidance excludes any contribution from the GAC initiative, projecting revenue of approximately $120 million to $125 million and adjusted EBITDA of approximately $17 million to $20 million, derived solely from its powdered activated carbon business [5]. - Following these disclosures, Arq's share price experienced a decline [5].

Financial Data and Key Metrics Changes - Revenue for the full year 2025 reached approximately $120 million, reflecting a 10% year-over-year growth driven by improvements in average selling price and volumes [51][58] - Adjusted EBITDA for 2025 was $13.2 million, representing a 26% improvement compared to 2024, despite the impact of GAC startup costs [51][52] - Q4 2025 revenue totaled $29.4 million, up around 8% year-over-year, with a gross margin of 13.6%, significantly impacted by GAC ramp-up costs [54][55] Business Line Data and Key Metrics Changes - The PAC business delivered exceptional performance in 2025, with revenues reaching approximately $120 million, up 10% year-over-year, and adjusted EBITDA of $13 million [38][51] - The company is pausing GAC production to conduct a comprehensive engineering and production process optimization review, with no GAC production expected in 2026 [9][25] Market Data and Key Metrics Changes - The GAC market fundamentals remain strong, with persistent supply shortages against steady annual growth from existing demand drivers [27][28] - The company anticipates that the PAC business will continue to be cash generative in fiscal year 2026 and beyond, with strong visibility into future demand [56][58] Company Strategy and Development Direction - The company is focused on optimizing its GAC production process and has made strategic changes to its leadership team to enhance operational efficiency [32][36] - The shift towards specialty products and engineered materials is expected to improve the business profile and command premium pricing [43][49] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term demand for GAC, citing a significant demand-supply imbalance that is expected to persist [70][108] - The company is committed to making disciplined capital allocation decisions and is focused on rebuilding investor confidence through consistent execution [62][64] Other Important Information - The company is taking a $45 million write-down on its Corbin assets as part of its decision to switch GAC feedstock to purchased bituminous coal [29][30] - The company ended the year with total cash of $15 million and total debt of $28.5 million, reflecting an increase due to higher utilization of its credit facility [57] Q&A Session Summary Question: Is there anything preventing the company from pursuing GAC? - Management confirmed there are no barriers to pursuing GAC, emphasizing strong market fundamentals and expected demand [70][71] Question: Any commentary on regulatory undercurrents affecting PAC? - Management stated there is no regulatory uncertainty affecting the PAC business, with existing regulations remaining intact [72] Question: Guidance and free cash flow expectations? - Management indicated that the PAC business is expected to generate free cash flow, with maintenance CapEx anticipated to be lower in the following year [73] Question: Capacity to supply the market if demand increases? - Management confirmed there is capacity to expand PAC production to meet increased demand without cannibalizing GAC production [74] Question: Updates on alternative applications for Corbin wet cake? - Management reported progress in testing asphalt emulsion blending, but significant revenues from this application are not expected in 2026 [92]

Financial Data and Key Metrics Changes - Revenue for the full year 2025 reached approximately $120 million, reflecting a 10% year-over-year increase, driven by solid improvements in average selling price and volumes [51][57] - Adjusted EBITDA for 2025 was $13.2 million, representing a 26% improvement compared to 2024, despite the impact of GAC startup costs [52][56] - Gross margin for the year was 27.9%, negatively impacted by GAC ramp-up costs [51] Business Line Data and Key Metrics Changes - The PAC business delivered exceptional performance in 2025, with revenues reaching approximately $120 million, up 10% year-over-year [38][51] - The company is pausing GAC production to conduct a comprehensive engineering and production process optimization review, with no GAC production expected in 2026 [9][60] - The PAC business is expected to generate adjusted EBITDA of $17 million to $20 million for 2026, based on proven operations [61][58] Market Data and Key Metrics Changes - The GAC market fundamentals remain strong, with persistent supply shortages against steady annual growth from existing demand drivers [27][28] - The company has 96% contract visibility on 2026 targeted volumes and 75% visibility through 2027, indicating strong demand and customer loyalty [44][102] Company Strategy and Development Direction - The company is focused on optimizing its GAC production process and has made strategic changes to its leadership team to enhance operational efficiency [32][36] - The decision to pause GAC production is a disciplined capital allocation decision, not a reflection of lost confidence in the market opportunity [60] - The company aims to transition to purchasing domestic bituminous coal feedstock to eliminate moisture-related production constraints and improve yield [17][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term demand for GAC, citing a significant demand-supply imbalance that is expected to persist [70][108] - The company is committed to rebuilding investor confidence through consistent execution and delivering on its 2026 PAC guidance [61][62] Other Important Information - The company is taking a $45 million write-down on its Corbin assets as part of its decision to switch GAC feedstock [29][30] - The company ended the year with total cash of $15 million, with total debt of $28.5 million, reflecting increased utilization of its credit facility [56] Q&A Session Summary Question: Is there anything that would prevent the company from pursuing GAC? - Management confirmed there are no barriers to pursuing GAC due to strong market fundamentals and expected demand [69][70] Question: Any commentary on regulatory undercurrents affecting PAC? - Management stated there is no regulatory uncertainty affecting the PAC business, and existing regulations remain intact [72] Question: Guidance for free cash flow and balance sheet considerations? - Management indicated that the PAC business is expected to generate free cash flow, with maintenance CapEx included in the guidance [73] Question: Capacity to supply the market if demand increases? - Management confirmed there is capacity to expand PAC production to meet increased demand without cannibalizing GAC production [74] Question: Updates on alternative applications for Corbin wet cake? - Management provided updates on asphalt emulsion testing and other potential applications, noting progress but cautioning against expecting significant revenues in 2026 [92]

Q4 2025 Earnings Call March 10, 2026 Disclaimer This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and 21E of the Securities Exchange Act of 1934, as amended, which provides a "safe harbor" for such statements in certain circumstances. When used in this presentation, the words "anticipates," "may," "believes," "expects," "intends," "plans," "estimates," "predicts," the negative expressions of such words, or similar expressions a ...

Core Insights - Arq, Inc. reported record revenue of approximately $120 million for the full year 2025, driven by the performance of powdered activated carbon (PAC) [1][6][18] - The company achieved an Adjusted EBITDA of $13 million, reflecting a 26% improvement year-over-year [1][22] - Arq provided inaugural financial guidance for full-year 2026, expecting revenue between $120-125 million and Adjusted EBITDA of $17-20 million [1][13] Financial Highlights - Revenue for FY 2025 was $120.3 million, a 10% increase from $109.0 million in FY 2024, primarily due to improved average selling price (ASP) and product diversification [6][18] - Gross margin decreased to 27.9% in FY 2025 from 36.2% in FY 2024, attributed to higher costs related to granular activated carbon (GAC) start-up [6][19] - The company recorded a net loss of $52.6 million for FY 2025, compared to a net loss of $5.1 million in FY 2024 [22][26] Operational Updates - Arq announced a pause in GAC production to conduct a comprehensive engineering and production process optimization review, with no GAC production expected in FY 2026 [5][7] - The decision to pause GAC production follows testing results indicating that the current thermal oxidizer can only support approximately 15 million pounds of annual GAC production, which does not deliver acceptable returns [7][8] - The company is transitioning from Corbin Wetcake feedstock to bituminous proven performance coal to address design challenges [8][9] Leadership Changes - Eric Robinson has been appointed as VP Operations, bringing over 30 years of industrial experience [10][12] - The company has reorganized its finance team, promoting Anthony Nathan to VP Finance [12] Future Guidance - For FY 2026, Arq expects PAC average selling price to be between $0.88-0.91 per pound, with projected production volumes of 122-125 million pounds [13][14] - Additional revenue from other chemicals and products is anticipated to contribute approximately 13-15% of total revenue [14]

Financial Performance & Growth - Total revenue reached $35.1 million, a 1% year-over-year increase, driven by strong pricing in the foundational Powdered Activated Carbon (PAC) business[7, 12] - Adjusted EBITDA was $5.2 million, marking the 6th consecutive quarter of positive Adjusted EBITDA, though negatively impacted by low volume and early Granular Activated Carbon (GAC) ramp-up[7, 12] - PAC pricing grew by 7% year-over-year, with an approximate 15% average quarterly growth in PAC Average Sales Price (ASP) since Q2 2023, showing strong visibility in PAC contract renewals into 2026 and beyond[8] - A $25+ million Adjusted EBITDA improvement has been achieved since Q3 2023 on a trailing twelve-month basis, driven by the PAC turnaround and cost management[7] GAC Business & Strategy - Initial commercial phase GAC production and sales were achieved, with robust GAC market dynamics[7] - The company is exploring blending or replacing Corbin GAC feedstock and advancing alternative product developments for Corbin feedstock[9] - The Final Investment Decision (FID) for Phase II is now anticipated to coincide with reaching Phase I GAC nameplate capacity around mid-2026[36] Market & Regulatory Landscape - Regulations could boost municipal water market demand 3-5x from approximately 170 million lb/year, serving as a major catalyst for demand and potential supply shortages[88] - The company expects the annual GAC market to grow approximately 75% to over 700 million lbs, resulting in an approximate 370 million lbs supply shortfall by 2030[103] - Approximately 35% of the approximately 153,000 public water systems in the U S are estimated to require PFAS treatment facilities by 2030[101]

Core Insights - Arq, Inc. reported a revenue of $35.1 million for Q3 2025, marking a 1% increase year-over-year, primarily driven by a 7% increase in average sales price (ASP) despite slightly lower sales volumes [5][8] - The company achieved an Adjusted EBITDA of $5.2 million, representing the sixth consecutive quarter of positive Adjusted EBITDA, although it faced non-recurring costs impacting this figure [5][15] - The initial commercial phase of Granular Activated Carbon (GAC) production and sales was successfully launched, contributing to revenue generation [5][6] Financial Highlights - Revenue for Q3 2025 totaled $35.1 million, up from $34.8 million in the prior year [8] - Gross margin decreased to 28.8% from 38.6% year-over-year, primarily due to lower GAC production volumes and higher fixed production costs [10] - The company reported a net loss of $0.7 million in Q3 2025, compared to a net income of $1.6 million in the same period last year [14] Operational Highlights - The company successfully commenced its first commercial GAC production and sales at the Red River facility, which is expected to enhance revenue streams [5][6] - GAC market dynamics remain strong, with increased demand for spot purchases and anticipated growth in contracted volumes [6] - The ramp-up of GAC Phase I production has faced challenges due to design issues, with nameplate capacity expected to be achieved around mid-2026 [6][7] Cost and Expense Management - Costs of revenue increased by approximately 17% to $25.0 million in Q3 2025, driven by higher direct labor, utilities, and equipment rental costs [9] - Selling, general, and administrative expenses decreased by 43% to $4.6 million, attributed to lower payroll and benefit costs [11] - Research and development costs rose to $2.6 million, reflecting expenses related to pre-commencement testing of the GAC facility [12] Capital Expenditures and Balance Sheet - Capital expenditures for the full year 2025 are projected to remain between $8 million and $12 million, with Q3 2025 capex totaling $2.2 million [17] - As of September 30, 2025, the company had cash and restricted cash totaling $15.5 million, down from $22.2 million at the end of 2024 [17] - Total debt increased to $25.9 million as of September 30, 2025, compared to $24.8 million at the end of 2024, primarily due to the revolving credit facility [18]

Core Viewpoint - Arq, Inc. has published its 2024 Sustainability Report, highlighting its strong financial performance and commitment to environmental, social, and governance (ESG) excellence while advancing its mission of enabling a cleaner planet [1][2]. Financial Performance - In 2024, Arq achieved approximately $109 million in revenue and demonstrated consecutive quarters of positive adjusted EBITDA growth, indicating a successful year financially [2]. Environmental Leadership - The report emphasizes Arq's unique market position to capitalize on opportunities arising from new environmental regulations, particularly the EPA's 2024 PFAS drinking water standards, which require a reduction from 70 parts per trillion to 4 parts per trillion by the end of the decade [4]. - Arq anticipates a potential supply gap of 370 million pounds by 2030, positioning the company for sustained growth in activated carbon solutions [4]. Social Responsibility and People Excellence - The company maintains industry-leading safety performance with zero fatalities across all facilities and has 202 dedicated employees [5]. - Arq has implemented comprehensive wellness and professional development programs to support employee growth and expanded community engagement through volunteer initiatives and educational partnerships [5]. Governance and Transparency - The report reflects Arq's commitment to transparency and stakeholder engagement, providing detailed performance metrics and progress updates across ESG dimensions [6]. - Enhanced Board oversight of ESG initiatives is facilitated through the Nominating and Governance Committee, and the company has achieved a 100% completion rate for comprehensive ethics training among employees [5][6]. Innovation and Technology Leadership - Arq holds over 140 granted patents and patent applications in activated carbon and adjacent technologies, showcasing its strong R&D capabilities [5]. - The company has established a world-class R&D environment with comprehensive product testing across more than 100 potential applications [5]. Strategic Market Position and Outlook - Arq's diversified customer base spans municipal water treatment, industrial air purification, and renewable natural gas applications, validating its strategic approach [5]. - The company is nearing mechanical completion and has commenced initial equipment commissioning at its Red River facility, which is crucial for addressing PFAS contamination challenges [5].

Financial Data and Key Metrics Changes - Revenue for Q2 2025 was $29 million, representing a 13% year-over-year increase, driven by enhanced contract terms and a 9% growth in average selling price (ASP) [22][6][5] - Adjusted EBITDA was approximately $3.7 million, compared to $1.1 million in the prior year, marking a more than 3x increase [23][6] - Gross margin for the quarter was approximately 33%, slightly higher than in 2024 [22] Business Line Data and Key Metrics Changes - The PAC (Powdered Activated Carbon) business has shown a successful turnaround, with all sales contracts now being net contributors in 2025, a significant improvement from 24% of volumes being loss-making as of December 2022 [24][6] - The GAC (Granular Activated Carbon) line has been successfully commissioned, with a nameplate capacity of 25 million pounds expected to be reached within six months [5][12] Market Data and Key Metrics Changes - The company has reduced its exposure to the mercury emissions market to under 40% of volumes, diversifying into new markets for both PAC and GAC, which improves margins and overall financial performance [8][9] - The granular activated carbon market is experiencing persistent supply shortages, with demand expected to grow significantly due to regulatory changes related to PFAS [10][11] Company Strategy and Development Direction - The company aims to enhance profitability through operational optimization and cost reduction initiatives while expanding into higher growth, higher margin GAC business [7][29] - Plans for a second GAC line are underway, with a final investment decision expected by the end of 2025 [14][29] Management's Comments on Operating Environment and Future Outlook - Management views the current regulatory environment as favorable, with the EPA's pragmatic approach to PFAS regulation seen as beneficial for the business [18][19] - The company is confident in its ability to finance future growth through cash flow generation and existing debt facilities, without the need for further equity issuance [66][68] Other Important Information - The company is engaged in testing programs for asphalt emulsion, which could represent a significant future revenue source [20][78] - The company has reiterated its 2025 capital expenditure forecast of between $8 million and $12 million [26] Q&A Session Summary Question: Can you elaborate on the key milestones in the commissioning process at Red River? - Management confirmed that the operations team is focused on reaching full nameplate capacity of 25 million pounds as quickly as possible, with ongoing tweaks to improve production rates [35][36] Question: What is the expected cost for the second GAC line? - Management indicated that costs are being evaluated and enhancements from the first line will likely reduce expenses for the second line [39][40] Question: What is the timeline for moving from initial sales to contracts in the RNG market? - The timeline varies from one to eight months depending on customer testing requirements, with a focus on maintaining a balanced customer mix across different industries [41][43] Question: What impact did commissioning have on gross margins? - Approximately $1.9 million in costs associated with preproduction inventory were reclassified to R&D expenses, with gross margins expected to remain above 33% going forward [46][47] Question: How confident is the company in financing the second line without issuing equity? - Management expressed confidence in financing through cash flow generation and debt availability, emphasizing a gradual investment approach [66][68]