Orion Engineered Carbons(US:OEC)2025-11-05 13:30Financial Performance - Q3 2025 - Adjusted EBITDA decreased by 28% year-over-year to approximately $57.7 million, primarily due to soft volumes in key regions, adverse fixed cost absorption variances, and inventory revaluation [5, 24] - Net sales decreased by 2.7% year-over-year to $450.9 million [24] - Gross profit decreased by 20.4% year-over-year to $85.6 million [24] - Adjusted net income decreased by 40.5% year-over-year to $16.3 million [24] Segment Performance - Q3 2025 - Rubber Carbon Black: Adjusted EBITDA decreased by 31.8% year-over-year to $36.1 million, with volume gains in APAC and South America [28, 31] - Specialty Carbon Black: Adjusted EBITDA decreased by 20.6% year-over-year to $21.6 million, with overall volumes modestly higher but predominantly into lower value markets [33, 35] Key Factors and Challenges - Tire imports into the U.S. remain a challenge, with tariffs of 25% on imported replacement tires [6, 15] - Macroeconomic conditions remain difficult, impacting end market recovery [5, 19] - The company is over-indexed to Western markets and premium tire makers, which are most impacted by import levels [6] Outlook and Strategy - Revised full-year 2025 Adjusted EBITDA guidance to $220 million - $235 million and Adjusted EPS to $0.80 - $0.95 per share [40] - The company expects positive free cash flow for 2025, revised to +$25 million - $40 million [38, 40] - The company is intensifying its focus on cash flow generation through cost actions and working capital management [18, 19]