ASIX

Image source: The Motley Fool. Friday, Aug. 7, 2026 at 9:30 a.m. ET Vice President, Investor Relations and Treasurer - Adam Kressel President and CEO - Erin N. Kane Senior Vice President and CFO - Patrick C. Day Operator: Good day. And welcome to the AdvanSix Second Quarter 26 Earnings Conference Call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Adam Kressel, Vice President, Investor Relations and Treasurer. Please go ahead. Adam Kressel: Thank you, Debbie. Good morning, and welcome to AdvanSix's second quarter 26 earnings Conference Call. With me here today are President and CEO, Erin N. Kane and Senior Vice President and CFO, Patrick C. Day. This call and webcast, including any non GAAP reconciliations, are available on our website at investors.advansix.com. Note that elements of this presentation contain forward-looking statements that are based on our best view of the world and of our business as we see it today. Those elements can change and the actual results could differ materially from those projected. And we ask that you consider them in that light. We refer you to the forward-looking statements included in our press release and earnings presentation. In addition, we identify the principal risks and uncertainties that affect our performance in our SEC filings including our annual report on Form 10-Ks, as further updated in subsequent filings with the SEC. This morning, we will review our financial results for the second quarter 26, and share our outlook for our key product lines and end markets. Finally, we will leave time for your questions at the end. So with that, I will turn the call over to AdvanSix's President and CEO, Aaron Kane. Erin N. Kane: Thanks, Adam, and good morning, everyone. We appreciate you joining us here today for our quarterly call. As you saw in our press release, our resilient second quarter results reflected a significant sequential improvement in earnings and cash flow amid what remains a highly dynamic macro environment particularly in plant nutrients. Patrick will dive into the financials in a moment, but I would like to start the discussion today framing our key strategic priorities. To drive through cycle value creation and support total shareholder return, with higher highs and higher lows, we remain focused on commercial execution, operational excellence, and disciplined capital deployment. These are the controllable levers that are critical to anchor our performance. On commercial execution, we continue to focus on winning with customers to profitably fill our plants and shifting product mix towards higher value applications. Our commercial teams continue to leverage both formula and market based pricing mechanisms to recover inflationary raw material costs. In the quarter, strong pricing across plant nutrients, Chemical Intermediates and Nylon Solutions offset higher sulfur, benzene, and propylene costs. Importantly, our year-over-year net price overalls impact was neutral in the quarter which is a notable improvement from the first quarter headwinds. On operational excellence, we are well positioned through our integrated asset base global low cost position, and continued focus on productivity. Our base capital investments support safe, stable and sustainable operations. As we discussed on prior calls, our ammonia turnaround was moved to the second quarter and scoped to align with our suppliers' natural gas pipeline inspection. We are pleased to share that we executed to our expectations. Lastly, we are focused on generating meaningful operating cash flow to support disciplined capital deployment. From a working capital perspective, our cash conversion cycle benchmarks in the top quartile among peers. Our significant runway of opportunity on 45Q carbon capture tax credits also supports future cash generation. As we allocate capital, our discretionary organic investments target greater than 20% returns. Our sustained growth program is generating returns in excess of 30% and we remain on track to deliver product mix optimization with 75% ammonia sulfate granular conversion. This is an important milestone as we continue to align our production with growing demand for sulfur nutrition. We will continue to ensure a well managed balance sheet. That will afford the investments for performance and growth. We continue to expect improved earnings and cash flow in the second half of the year compared to the first half as we build momentum into 2027. While the near term market environment has been mixed, our durable competitive advantage portfolio resiliency across a diverse set of end markets and our long term positioning for growth underpin what we believe is a compelling investment thesis for AdvanSix. Let's turn to slide 4. Based on our expectations coming out of the first quarter earnings call, a number of items played out as anticipated Notably, the sequential improvement in net pricing over rising raw material costs was a primary driver of our earnings improvement. Both Nylon Solutions and Chemical Intermediates performed at or better than our expectations with strong commercial performance and mix optimization supporting margins. Plant nutrient volume, however, was lower than anticipated. The spring planting season saw significant increase in grower input costs while crop and grain prices remained steady at lower levels. This unfavorably impacted farmer profitability and resulted in a reduction of fertilizer consumption overall. Despite these challenges, we ended the full fertilizer year at near record volume performance for domestic granular ammonium sulfate. Lastly, our utilization rates were lower on operational performance, including the impact of our ammonia plant turnaround. With that, I will turn it to Patrick to discuss the financials. Patrick C. Day: Thanks, Erin. I am now on Slide 5 to discuss our results for the quarter. Sales of $421 million increased approximately 3% versus the prior year comprised of 18% favorable pricing partially offset by a 15% decline in volume. Raw material pass through pricing was up 13% following a net cost increase in benzene and propylene. Market based pricing improved 5% primarily driven by an increase in plant nutrients. Reflecting higher nitrogen pricing amid increased sulfur input costs. Lower sales volume was primarily driven by more challenging agricultural fundamentals, including farmer economics. Which resulted in a reduction of in season fertilizer purchases. Adjusted EBITDA was $32 million down $24 million from last year. I will highlight the key year over year variances in a moment. Adjusted earnings per share of $0.19 declined $1.5 versus the prior year. The higher effective tax rate compared to last year was driven primarily by 45Q carbon capture tax credits claimed in the prior year period and changes in taxable income. We expect the full year 2026 effective tax rate to be in the range of 10% to 15% prior to any additional 45Q claims. On a sequential basis compared to the first quarter, earnings and cash flow improved significantly. With tailwinds across the portfolio from net favorable pricing over raw material input costs. So overall, a testament to the commercial performance in the first half of this year Now let's turn to Slide 6. In the quarter, we drove pricing improvement across the portfolio on both a year-over-year and sequential basis. This was supported by higher raw material pass through pricing as well as an increase in market based pricing. The primary driver of lower volume both year-over-year and sequentially was plant nutrients. Due to the in season dynamics we observe. To a lesser extent we saw modestly lower volumes quarter-over-quarter in nylon solutions and chemical intermediates. Across Nylon Solutions, resin volumes increased year-over-year on improved operational performance while caprolactam volumes moderated in a soft demand environment for carpet applications. We saw a reduction overall in export volume sequentially in the second quarter. A more constrained production environment including the planned turnaround activities shifted our focus to serving our North American customers. Consistent with our ongoing operating approach, we evaluate the optimal product and geographic mix to ensure the best economic outcome for the integrated enterprise. Let's turn to Slide 7. Here we highlight the key drivers of our second quarter adjusted EBITDA performance year-over-year. We completely offset the significant raw material cost increase in the quarter through commercial execution and pricing actions. We thought it was important to highlight in this environment the magnitude of the input cost inflation that we were able to offset through pricing in the quarter. As you can see on the right side of this slide, raw material costs were a headwind of $72 million in the second quarter on a year-over-year basis. This was primarily driven by rising benzene and sulfur prices. We were able to fully recoup that impact through strong commercial execution with favorable market and pass through pricing across the portfolio. On a sequential basis, while we incurred a $10 million headwind in 1Q, we saw that flip to a $39 million tailwind in 2Q. This was also supported by strong pricing in each business line more than offsetting rising benzene sulfur and propylene costs. Natural gas costs were seasonally lower the second quarter as compared to the first which is typical for our business. Now back to the bridge on the left side of the chart. Volume represented a $17 million unfavorable impact primarily driven by lower sales in Plant Nutrients in the face of more challenging agricultural fundamentals including farmer economics. Operationally, we saw an approximately $4 million unfavorable impact from the timing of planned plant turnarounds. Lastly, all other items netted to a $3 million headwind with the impact of reduced production output partially offset by lower SG&A as planned. Let's turn to slide 8. On the left side of the page, we have shown our first half free cash flow generation for 2025 and 2026. Our year to date performance is largely tracking to last year. When taking into account approximately $26 million of insurance proceeds in the prior year period. Working capital although improved year over year, has been a seasonal use of cash in the first half as expected. The primary driver of the improvement was disciplined inventory management. As we have shared previously, there is non linearity in our cash flow on a quarterly basis. As we look forward into the second half, we anticipate significant sequential improvement notably as a result of our reduced CapEx run rate working capital tailwinds including our fourth quarter pre buy program in Plant Nutrients, timing of annual payments paid in the first half and 45Q cash tax credits. Let me turn the call back to Aaron. Erin N. Kane: Thanks, Patrick. With the moving parts in our end markets, let's first take a deeper dive into what we are seeing in the plant nutrients market and specifically sulfur input costs. Which have been key drivers of our first half performance. We realized lower in season Plant Nutrient sales as a result of reduced grower application of nutrients. Ammonium sulfate demand softened significantly in 2Q, after strong early season purchases as farmers prioritize applying nitrogen in the peak of the season above all nutrients most notably ammonia. As the season progressed, growers applied fertilizer, including ammonium sulfate based on purchases and inventory that was in the channel. Despite weaker in season sales, we still achieved 1 of our strongest fertilizer year performances in terms of total domestic granular volume. It is clear that we structurally improved our output and mix supported by our sustained growth program. From an input perspective, sulfur costs have moved up to record highs over the course of the last year. It is evident that elevated sulfur prices amplified by the conflict in The Middle East created demand destruction across the industry, most notably in phosphates, which represent ~50% of sulfur demand. The Tampa sulfur marker closed at another record of $705 per long ton in the third quarter. Following $655 per long ton in the second. Third party industry experts are forecasting $200 decline in sulfur prices entering 2027. Which will be a tailwind for the next planting season amid what is likely tighter domestic ammonium sulfate supply. As a sensitivity for impact to AdvanSix, every $100 per long ton change in sulfur raw material price equals an approximately $35 million cost impact on an annual basis. In this environment, we have optionality to incrementally increase ammonia sales availability based on market dynamics across the entire value chain. Our plan for the full year 2026 is expected to be up 30% on ammonia sales volume compared to 2025, which was a prior record year. This reflects our ongoing debottlenecking efforts and the benefit of targeted replacement maintenance capital investments over time. With our positive experience securing our USDA grant in support of our SUSTAIN program, we are now planning to apply for their new fields grant to expand our ammonia capacity and increase nitrogen nutrition availability for domestic farmers. In addition, our previously announced DEF project is progressing through its evaluation phases as planned, and if move forward would unlock more value off our integrated ammonia platform. We Let's turn to slide 10 to highlight what we are seeing across the rest of the portfolio. Moving beyond ag to our key nylon and markets, across building construction, engineering plastics and packaging, North American demand has not materially changed. Global pricing has moved up with higher input costs while raw material shortages, logistics constraints, and lower operating rates in China have tightened supply. Similar to nylon, end market demand across chemical intermediates into construction, coatings, and downstream industrials has been broadly stable Phenol demand remained soft overall, driving lower global operating rates, coupled with reduced acetone imports into The US. All of which are supporting tighter phenol-acetone supply and demand dynamics. Let's move to slide 11. Looking ahead, we have line of sight to several drivers in place to support second half sequential EBITDA and cash flow improvement. On earnings, we expect benefits from the absence of the first quarter winter storm impact and the completion of our larger planned turnaround in the second quarter. We continue to target approximately $10 million savings exiting 2026 from our multiyear non manpower fixed cost reduction program. In Nylon Solutions, we expect steady volume performance and continued focus on price-raws expansion through disciplined commercial execution and mix optimization. In chemical intermediates, we continue to expect cycle average performance for acetone spreads while our other products in the portfolio are performing to expectations. Implant nutrients at this point in the year we have historically realized a $10 million to $15 million sequential headwind on earnings due to the reset of the North American fertilizer year beginning with the fall fill program. This year, we expect the impact to be greater given pricing dynamics amid higher sulfur input costs that have impacted the fill program outcomes. Due to the softer late season demand as discussed, there was fertilizer inventory left in the channel, which prompted competitive intensity as players, including traders of imported and other domestic volume, sought to liquidate their positions without regard to producer economics. While this has near term impact, we remain focused on serving our customers with a strong sulfur nutrition value proposition we have long built through sound agronomic research, and grower yield benefits. Moving to cash, there are several tailwinds, which Patrick highlighted, supporting our stronger second half performance. Let's turn to Slide 12 before moving to Q&A. We remain confident in the through value creation opportunity at AdvanSix. Our unique combination of assets and business model are core to our durable competitive advantage and long term positioning. Key to our strategy is a focus on the levers we control. Commercial execution, operational excellence, cash generation and disciplined capital deployment. As we move through the remainder of 2026, and navigate the current industry environment, we are well positioned to support our strategic priorities as a U. S.-based integrated manufacturer aligned to domestic supply chain and energy markets as well as a diverse set of end market applications. We believe the actions we are taking and strategic priorities ahead support AdvanSix to deliver improved performance and sustainable long term value. With that, Adam, let's move to Q&A. Adam Kressel: Thanks, Erin. Debbie, can you please open the line for questions? Operator: We will now begin the question and answer session. If your question has been addressed and you would like to withdraw your question. Please press star then 2. The first question comes from Pete Oesterlin with Truist Securities. Please go ahead. Pete Osterland: Hey, good morning. Thanks for taking the questions. So just wanted to start on the comment on running Hopewell at lower rates than you expected. Was this a market based decision driven by ammonium sulfate demand? Or were there any operational delays coming out of the turnaround? And then also maybe if you could size just how far below your optimal rates you are running and how much line of sight you have into when conditions would be supportive of raising operating rates? Erin N. Kane: Yeah. Thanks for the note question, Pete, and good morning. Certainly in the quarter, we would have had Hopewell running around mid-70s, consistent with Other Turnaround Quarters. So a large majority There Would Have been really being constrained through Our Ammonia Production, Which Has Implications on the full value Chain. And So As We Proceed Forward, Obviously, We are Focused On As We have Shared, Running The Assets To The Demand. So As You have Seen, Certainly, Our Chesterfield operation operations are improving year over year. and operational performance is important there. Then, obviously, we are continuing to evaluate really the economics given the environment on both how we think about monetizing ammonia and sulfuric acid in the environment for ammonium sulfide. But we have to take the full enterprise chain you know, all the way through to the mix to make those best decisions. So it is kind of an ongoing, you know, opportunity set for us to optimize. Pete Osterland: Okay. Understood. And then, a lot of moving with pricing versus raw materials. But just following full offset of pricing versus raws in second quarter, do you have an estimate or a range you could share of what you would expect the net impact would look like in the third quarter just based on what you can see right now? Erin N. Kane: Yeah. Certainly, as we shared I can start and then Patrick can jump in as well. Given where sulfur has landed, I think that is going to be the largest headwind vis a vis certainly where ammonium sulfate pricing has reset right in the fall fill program. Benzene and propylene are going to move with oil. Right? And then certainly we have moving parts there based on really how the Middle East is on a regular basis. So when you think about the pricing mechanisms you know, the formula and pass through definitely play more to benzene being passed through in the formulas, you know, mechanistically. So it is really going to be, you know, how the soft plays out relative to the price performance. Patrick C. Day: Yeah. I think we highlighted in our comments that $10 million to $15 million sequential headwind. that is currently the range we are working with and what we expect. Pete Osterland: Okay. Very helpful. Thanks. So just wanted to finish with a couple of questions and some of the cash tailwinds you are expecting in the second half. So just first on the ammonium sulfate pre buy advances with some of the challenges around farmer economics and fertilizer demand that you called out Do you expect the pre buy in the second half to be weaker than normal? And I guess could you size what is normal? And what are your expectations for how that is shaping up this year? Erin N. Kane: Yeah. At this point, we would anticipate that it is a bit, on 1 hand, a little too early to tell. Right? We are just, you know, getting through the fall fill. Obviously, this is something that we generally see as steady demand, you know, every winter. You know, at this point with you know, nutrition, really kind of watching now the fundamentals and the guideposts. Right? So we are watching the current crop demands sorry, you know, crop performance if you think about we will get more from the USDA this week. You have got certainly implications now that the corn rating has declined since mid July, a little bit more in line with 22 and 23 crops than the last 2 years. So how that plays into yield estimates, how that will play into future corn prices, obviously, reset in profitability. And so we would if we sit here today, you know, there is no reason to think that there would not be a positive view relative to that pre buy program setting up for next spring. You know, you could see still a constructive setup. Right? When you kind of look forward relative to where we sit today. And head forward into the spring. We would think that also see that ammonium sulfate will probably be a bit tighter as well as we move forward. I know as we sit here today, the input costs are not supporting, we believe, and what the feedback is from the industry that the marginal producer in The US is not running. And so again, are the things that we are going to continue to look at as we progress through Q4 and work to set up a constructive view as we get to spring. Pete Osterland: Okay. Great. And then just lastly, on the CapEx for the second half, when you talk about risk based prioritization, are these mainly deferrals of spending that at some point in the future you have to catch up on? And what kind of activities are we talking Just maybe some more color around that would be helpful. Erin N. Kane: Sure. When you think about sort of historical approaches in many cases to, you know, repair maintenance, as well as, just capital, intensity on that same view. A lot of the techniques are time based. Right? A piece of equipment goes in with an expected life The reality is, you know, in today's view, you can use better data, have quantitative risk assessments, so when we talk about risk based, it is using better indications on when we should be tackling the repair and maintenance type capital in the assets going forward based on how we need them to run to meet demand. So you know, I would not think about it as a deferral where there will be a catch up, but rather a overall reflating or reprioritization, right, using, you know, data heuristics and new just ways to prioritize we spend, when we spend it, you know, across the enterprise. And so the back half just reflects I mean, obviously, you know, you have got a time lag here, right, for our actions to take place relative to the cash flow. So certainly, the first half heavier, right, as we exited 2025, and then putting this into place as we roll forward. Pete Osterland: Excellent. Thanks a lot. Erin N. Kane: Thanks, Pete. Operator: The next question is from David Silver with Freedom Capital Markets. Please go ahead. David Silver: Yes. Hi. Thank you. Good morning. Guess I just wanted to pick up maybe on 1 of your recent comments about the lower operating rates for your overall production network. And the opportunity, I guess, to gain some flexibility in what you are selling and whatnot. So you mentioned that the ammonia and the sulfuric acid units in particular, you know, maybe there is an opportunity there to sell more of those products just as they are as opposed to running them through, you know, your vertically integrated network there. But, especially with the slower fertilizer season here, I mean, are you thinking about maybe co ing a little more flexibility and a little more of those basic products. I am sorry. I am not speaking very clearly. But just selling ammonia and sulfuric acid more into what seemed to be pretty healthy markets right now? Erin N. Kane: Thanks for the question and good morning, David. Yes. So that is definitely what we are trying to increase and certainly been core to a lot of our strategies across even expanding beyond the operational excellence of running our assets well, creating more degrees of freedom and a few more levers to flex in the optionality to do so. So certainly, in the spring, the industry sold more ammonia than normal as it was cheapest source of nitrogen. You know, we sold certainly more in the first half. Again, these are products that are would say, logistics sensitive. Right? So there are freight logical, you know, reaches, if you will, and certainly where we sit in the Mid Atlantic, we have to optimize what we can sell there. But to put it in perspective, we sold, roughly 49 thousand short tons in the first half up from, you know, 33 in the first half of 25. And just to put that in perspective, while we shared at the end of last year, we had a record sales for ammonia. You know, we anticipate that as we project through this year, we will be up 30%, you know, year on year for the full year. Now you know, obviously, sulfuric acid as well as a freight logical product, we continue to look at that. You think about the trade offs, right, I would share with you, it is not just a simple as, you know, do we either sell ammonia and sulfuric acid, or do we make ammonium sulfate? Because we are not making just synthetic ammonium sulfate. We have an integrated chain So we really do need to look at the full set of options including, you know, do we make caprolactam for X Do we make resin for export? Know, how are the performance implications on Frankfurt? So we look at the integrated change make those economic decisions And so certainly, relative to our, targeted operational approach for the back half of the year, we are dialing in to where that optimization makes sense. So and we certainly are we have a little bit of a knob, if you will, on how we can think about the AS, the capro lever. Right? We built that through the COVID years and thinking about our own technology and we certainly are you know, looking to minimize that as well as an extra lever. So it is a pretty integrated set of considerations, but that is how we are running it today. David Silver: Okay. And I stipulate it is a very complicated decision map, I guess, and not as easy as flipping a switch. But if anybody you know, was aware of kind of how to tweak the system, I think it would be yourself and your team there. If I could just, and I apologize, I did have to step away at 1 point. But, could I just get an update on the expectations for the Section 45 credits? In other words, both when you might be booking an additional round of credits for 20 for 2026? And then when cash might be received from the credits that you claimed? In 2025? Thank you. Patrick C. Day: Sure, David. Let me take that 1. So just as some background, our 2018 LCA is already approved by the IRS. This allowed us to claim the credits for 2029, 2028, and 2020. We have done over the recent years, We have $18 million currently accrued on the balance sheet related to that LCA. Our 2021 LCA is still under review by the DOE and the IRS We worked closely with them on an updated submission here in the second quarter. To assure that they had all the required data that they needed. All 4 of these years are currently included in a broader audit by the IRS. As soon as that is resolved, expect to receive the $18 million payment we are still targeting that for the second half of this year. And then once that 21 LCA is approved, we will use the approved 2021 LCA to begin the credit refund process for those applicable years And as a reminder, that can be used for up to 3 years. And at this point, look, all open items on our side related to the LCAs and audits closed. We are here to be responsive to the IRS and or DOE. In the event any questions come up as they may arise, they are completing their process. David Silver: Okay. that is great detail. Patrick C. Day: Thank you, Patrick. Can I also just double check, but is the total amount of credits that you are ultimately targeting? David Silver: Is it still in that $100 million to $125 million range? Or has there been any variation based on the review by the federal authorities thus far. Patrick C. Day: No changes to that range at this point. David Silver: Okay, great. Would like to maybe switch over to the DEF opportunity that was mentioned last highlighted a little bit last quarter. At the early stages of the process, I understand, but could you just provide maybe an update on the progress to date and any changes or any notable developments that you would highlight at this, you know, relatively early stage Thanks, David. Erin N. Kane: Certainly, the project remains on track and as planned. So as you say, we announced it last quarter. We entered into the licensing agreement. To assess the expansion of the platform on our integrated volume platform and certainly supply DEF into the growing market in the Mid Atlantic and East Coast. So we continue to progress through our front end engineering design work. And that is proceeding with our partners and still on track for that final investment decision targeted for the first half of 27. Now as a reminder, this is a multiyear capital investment with you know, we believe, you know, strong attractive financial returns. And align with our long term value creation objectives, and upon a successful view here know, the timing for full operations would be in 2029. So, again, progressing as we anticipated. You know, obviously, we will continue to keep you apprised. You know, I would share, you know, it was in the commentary, you know, lends itself because I know you have asked the question in the past of do we need more ammonia you know, to produce the which we do not necessarily. But it is been interesting. You know, we are 1 of 8 successfully performing USDA grant projects through SISTAIN, And, with that, credibility and certainly momentum we have built, The USDA has launched a new program called FEELS, the fertilizer investment in expansion for long term domestic supply grants, which we are planning to apply for relative to our ammonia to expand our ammonia capacity and increase nitrogen availability for domestic farmers. So while, again, it was not necessary for DEF, this new opportunity has presented itself. Again, we have strong performance under the current grants. This grant is different. It actually is a 1-for-1 match on dollar spent with 50% covered, whereas the current grant is only 20%. And we are pretty excited about the opportunity. We believe we have a more capital efficient program than what others have discussed. So more to come there, but just again, you know, the opportunities that we have on the integrated ammonia platform, you know, continues to, provide real opportunity. David Silver: Wow. that is a little different. And, yeah, you know, just to clarify, and I apologize but you are saying potentially a project to add or debottleneck ammonia capacity would be done 50% subsidies totaling about 50% of the estimated cost. Is that what field represents? Or did I misunderstand? Erin N. Kane: Yeah. If Yeah, that is the opportunity ahead of us. So, you know, the grant program was launched and applications are due, so we are working that at hand. So more to come there, but, you know, just wanted to you know, to share that. David Silver: Yeah. Very interesting. Okay. Just some comments, and again, I may have stepped away when Patrick was going over this. But just running kind of, you know, back of the envelope on cash flow generation or free cash flow prospects for the second half of the year? And you did highlight, I am guessing, fourth quarter cash receipts from growers might be a little lower this year. On the other hand, you have really been very, very you know, efficient, with the turnarounds and maintenance expenses. And, you know, I was looking at kind of, you know, you do have relatively low inventory levels, at least to my view. So just what are the prospects for getting close to cash breakeven or so in the back half of the year? Patrick C. Day: Yes, sure. I can give you a couple of comments there. First, let me start with the Plant Nutrients pre buy. I will say in Q4 of last year, comparing to the prior year, Q4 of last year, we were fairly selective on what we took in terms of prebuy, Just given we knew some of the dynamics were happening around sulfur. So in terms of year over year comparison, you know, I think that is a I would say that is a you know, a relatively soft, comparison point. We touched on CapEx you know, as we were talking through the CapEx details. Really, the way that our sequencing lines up on a cash basis with CapEx, we are more heavily weighted to the, you know, to the front end of the of the calendar. And then I think the last piece too, like, we are looking at you know, sequential earnings improvement too in the in the second half, which is obviously gonna contribute some more cash as well. So and I think that just the last piece we talked about payment timing, just the way the calendar year on unfolds for us. Have some higher payments going out the door in the first half of the year. Insurance, for example, those invoices get paid on a timing basis earlier in the calendar year. So we have some timing due to that as well. But those are really your big drivers that get you back to the you know, first half versus second half sequential improvement in cash. David Silver: Okay. Great. Thanks for the detail there. that is all for me. Appreciate the color. Erin N. Kane: Thanks, David. Have a great day. Operator: This concludes our question and answer session. Erin N. Kane: I would like to turn the conference back over to Erin N. Kane for any closing remarks. Thank you all again for your time and interest this morning. We hope this call and discussion have clarified the key considerations that supported our second quarter performance and outlook across our end markets. The strength of our business model and our position as an integrated chemistry company will serve us well and we continue to expect performance this year to demonstrate our resilience. With that, we look forward to speaking with you again next quarter. Stay safe and be well. Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect. Before you buy stock in AdvanSix, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and AdvanSix wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. 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Interested in AdvanSix? Here are five stocks we like better. Q2 sales rose 3% to $421 million as higher pricing offset lower volumes, but adjusted EBITDA fell $24 million year over year to $32 million and adjusted EPS declined to $0.19. Fertilizer volumes weakened as high input costs and low crop prices pressured growers, though pricing actions fully offset a $72 million raw-material cost headwind. AdvanSix expects a larger-than-usual Plant Nutrients earnings headwind in the second half as fertilizer inventories and elevated sulfur costs weigh on the market. Management expects second-half earnings and cash flow to improve sequentially, supported by lower capital spending, working-capital benefits, turnaround completion and an anticipated $18 million 45Q carbon-capture tax-credit payment. Full-year ammonia sales are projected to rise 30% from 2025. AdvanSix (NYSE:ASIX) reported second-quarter 2026 sales of $421 million, up approximately 3% from a year earlier, as higher pricing offset lower volumes across its portfolio. Adjusted EBITDA was $32 million, down $24 million year over year, while adjusted earnings per share declined $1.05 to $0.19. President and CEO Erin Kane said the company delivered sequential improvements in earnings and cash flow despite a dynamic market backdrop, particularly in Plant Nutrients. Management said its commercial pricing actions fully offset higher costs for sulfur, benzene and propylene during the quarter, bringing the year-over-year net pricing-over-raw-material impact to neutral after a first-quarter headwind. → Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth Senior Vice President and CFO Patrick Day said sales growth reflected 18% favorable pricing, partially offset by a 15% volume decline. Raw-material pass-through pricing rose 13% following increased benzene and propylene costs, while market-based pricing increased 5%, primarily due to higher Plant Nutrients pricing amid elevated nitrogen and sulfur costs. Raw material costs represented a $72 million year-over-year headwind in the second quarter, driven mainly by benzene and sulfur prices, according to Day. AdvanSix said it fully recovered that cost increase through pricing actions across its businesses. On a sequential basis, the company said the net impact from pricing over raw materials swung from a $10 million headwind in the first quarter to a $39 million tailwind in the second quarter. → 4 Oil and Gas ETF Plays as Prices Stay Sky-High Lower Plant Nutrients sales volumes accounted for much of the decline in volume. Kane said farmers faced higher input costs while crop and grain prices remained at relatively low levels, pressuring grower profitability and reducing fertilizer consumption. Ammonium sulfate demand weakened in the second quarter after strong early-season purchases, as growers prioritized nitrogen applications, particularly ammonia, during the peak planting season. Despite softer in-season demand, AdvanSix said it completed the fertilizer year with near-record domestic granular ammonium sulfate volumes. The company attributed part of that performance to higher production output and mix improvements from its SUSTAIN growth program. → Sandisk Just Delivered a Blowout Quarter—Here's Why the Stock Is Falling AdvanSix said volume effects reduced second-quarter adjusted EBITDA by $17 million year over year, while the timing of planned plant turnarounds created an approximately $4 million operational headwind. The company moved its ammonia turnaround into the second quarter to align with a supplier’s natural-gas pipeline inspection and said the work was completed as expected. Kane told analysts that Hopewell utilization was in the mid-70% range during the quarter, consistent with other turnaround periods. The company is evaluating production and sales decisions across its integrated network, including opportunities to sell more ammonia and sulfuric acid depending on market economics. AdvanSix sold approximately 49,000 short tons of ammonia in the first half, compared with 33,000 short tons in the first half of 2025. Management expects full-year ammonia sales volumes to increase 30% from 2025, which had been a record year, reflecting debottlenecking efforts and targeted maintenance investments. Within Nylon Solutions, resin volumes rose year over year on improved operations, while caprolactam volumes moderated because of soft demand in carpet applications. Chemical Intermediates demand across construction, coatings and industrial markets was broadly stable, management said. The company also cited soft phenol demand, reduced global operating rates and lower acetone imports into the U.S. as factors tightening acetone market conditions. Sulfur costs reached record levels during the past year, with Kane citing the Middle East conflict as an amplifier of elevated pricing. The Tampa sulfur marker closed at $705 per long ton in the third quarter, after averaging $655 per long ton in the second quarter. AdvanSix said every $100-per-long-ton change in sulfur prices has an approximately $35 million annual cost impact on the company. Management said third-party industry experts forecast a roughly $200-per-long-ton decline in sulfur prices entering 2027, which could benefit the next planting season. However, AdvanSix expects a greater-than-normal Plant Nutrients earnings headwind in the second half as the North American fertilizer year resets through the fall fill program. Historically, the company has experienced a $10 million to $15 million sequential earnings headwind from Plant Nutrients during this period. This year’s effect is expected to be larger because high sulfur costs affected fall-fill pricing and fertilizer inventories remained in distribution channels, increasing competitive pressure as suppliers sought to liquidate inventory. AdvanSix nevertheless expects second-half earnings and cash flow to improve sequentially from the first half. Management cited the absence of first-quarter winter storm effects, completion of the larger second-quarter turnaround, lower capital spending, working-capital benefits, annual payment timing and anticipated 45Q carbon-capture tax-credit receipts. The company expects to receive an $18 million payment related to previously claimed 45Q credits in the second half, subject to resolution of an IRS audit. Day said AdvanSix’s 2018 life-cycle analysis is approved, while its 2021 analysis remains under review by the Department of Energy and IRS. The company maintained its longer-term targeted 45Q credit range of $100 million to $125 million. AdvanSix also said its diesel exhaust fluid project remains in front-end engineering and design work, with a final investment decision targeted for the first half of 2027. If advanced, the project would begin operations in 2029. Separately, the company plans to apply for a USDA FIELDS grant to expand ammonia capacity and nitrogen availability for domestic farmers. Kane said AdvanSix remains focused on commercial execution, operational reliability, cash generation and disciplined capital deployment as it seeks improved second-half performance and builds momentum into 2027. AdvanSix, Inc (NYSE: ASIX) is an integrated chemical manufacturer specializing in the production of nylon 6 intermediates and related co‐products. Established as a publicly traded spin‐off from Honeywell Specialty Chemicals in June 2016, the company is headquartered in Parsippany, New Jersey. The company’s principal product is caprolactam, the key building block for nylon 6 resin, used in fibers and engineering plastics across industries. In addition to caprolactam and nylon 6 resin, AdvanSix produces ammonium sulfate fertilizer and industrial chemicals such as phenol and acetone. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "AdvanSix Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Achieved significant sequential earnings improvement as raw material costs flipped from a $10 million headwind in the first quarter to a $39 million tailwind in the second quarter, while also fully offsetting $72 million in year-over-year raw material cost headwinds through disciplined pricing. Experienced lower-than-anticipated plant nutrient volumes as steady crop prices and high grower input costs pressured farmer profitability and reduced in-season fertilizer consumption. Maintained near-record domestic granular ammonium sulfate volume for the full fertilizer year despite late-season demand softening and competitive intensity from importers. Optimized the integrated asset base by shifting focus to North American customers and leveraging the ammonia platform to increase sales availability by 30% year-over-year. Executed the ammonia plant turnaround in alignment with supplier natural gas pipeline inspections, resulting in utilization rates in the mid-70s for the quarter. Continued product mix optimization with the sustained growth program remaining on track to deliver 75% ammonium sulfate granular conversion. Anticipate significant sequential improvement in EBITDA and cash flow for the second half of 2026, driven by reduced CapEx run rates and working capital tailwinds. Historically, the company has realized a $10 million to $15 million sequential headwind in plant nutrients due to the fertilizer year reset, but management expects the impact this year to be greater given pricing dynamics and higher sulfur input costs. Project a $200 per long ton decline in sulfur prices entering 2027, which management views as a significant tailwind for the next planting season. Targeting approximately $10 million in savings exiting 2026 through a multiyear non-manpower fixed cost reduction program. Advancing the Diesel Exhaust Fluid (DEF) project through front-end engineering design with a final investment decision targeted for the first half of 2027. Sulfur input costs reached record highs, with the Tampa marker hitting $705 per long ton, creating demand destruction across the industry. Management noted that every $100 per long ton change in sulfur price results in an approximately $35 million annual cost impact to the company. Planning to apply for the new USDA 'FIELDS' grant, which offers a 50% match for capital spent to expand ammonia capacity and domestic nitrogen availability. Identified competitive intensity in the fertilizer channel as traders liquidated positions without regard to producer economics during the late season. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management clarified that Hopewell ran at mid-70% utilization, primarily constrained by ammonia production which impacts the entire value chain. Operating decisions are being made by evaluating the full enterprise economics, including the trade-offs between selling ammonia/sulfuric acid versus producing ammonium sulfate. The company has $18 million currently accrued on the balance sheet and expects to receive this payment in the second half of 2026 following the resolution of an IRS audit. The 2021 Life Cycle Assessment (LCA) remains under review by the DOE and IRS, but management maintains its total target range of $100 million to $125 million in credits. Management is shifting from time-based maintenance to data-driven quantitative risk assessments to prioritize capital spending. This approach is described as a reprioritization of spend rather than a deferral that would lead to a future 'catch-up' period of high CapEx.

The most recent earnings report from AdvanSix Inc. (NYSE:ASIX) was disappointing for shareholders. While the headline numbers were soft, we believe that investors might be missing some encouraging factors. AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. Importantly, our data indicates that AdvanSix's profit was reduced by US$26m, due to unusual items, over the last year. While deductions due to unusual items are disappointing in the first instance, there is a silver lining. We looked at thousands of listed companies and found that unusual items are very often one-off in nature. And, after all, that's exactly what the accounting terminology implies. AdvanSix took a rather significant hit from unusual items in the year to March 2026. All else being equal, this would likely have the effect of making the statutory profit look worse than its underlying earnings power. That might leave you wondering what analysts are forecasting in terms of future profitability. Luckily, you can click here to see an interactive graph depicting future profitability, based on their estimates. Just as we noted the unusual items, we must inform you that AdvanSix received a tax benefit which contributed US$5.6m to the bottom line. This is meaningful because companies usually pay tax rather than receive tax benefits. Of course, prima facie it's great to receive a tax benefit. However, our data indicates that tax benefits can temporarily boost statutory profit in the year it is booked, but subsequently profit may fall back. In the likely event the tax benefit is not repeated, we'd expect to see its statutory profit levels drop, at least in the absence of strong growth. In its last report AdvanSix received a tax benefit which might make its profit look better than it really is on a underlying level. Having said that, it also had a unusual item reducing its profit. Considering all the aforementioned, we'd venture that AdvanSix's profit result is a pretty good guide to its true profitability, albeit a bit on the conservative side. Keep in mind, when it comes to analysing a stock it's worth noting the risks involved. Our analysis shows 3 warning signs for AdvanSix (1 doesn't sit too well with us!) and we strongly recommend you look at these before investing. Our examination of AdvanSix has focussed on certain factors that can make its earnings look better than they are. But there is always more to discover if you are capable of focussing your mind on minutiae. Some people consider a high return on equity to be a good sign of a quality business. While it might take a little research on your behalf, you may find this free collection of companies boasting high return on equity, or this list of stocks with significant insider holdings to be useful. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Interested in AdvanSix? Here are five stocks we like better. AdvanSix’s Q1 sales rose 7% to $404 million, helped by stronger chemical intermediates volumes and better plant nutrients pricing. But adjusted EBITDA fell sharply to $5 million as higher sulfur and natural gas costs, winter storm disruptions, and the loss of prior-year insurance proceeds weighed on profitability. Management expects meaningful improvement in Q2 as the company looks to recover more raw material costs during the domestic planting season and benefit from seasonal fertilizer demand. AdvanSix also kept its full-year capex outlook at $75 million to $95 million and still expects leverage near the low end of its target range by year-end. The company said sulfur prices have surged to record levels, with ammonium sulfate pricing largely offsetting input costs rather than expanding margins. AdvanSix is also evaluating a DEF expansion at its Hopewell, Virginia, site, with a final investment decision targeted for the first half of 2027 if the project moves forward. AdvanSix (NYSE:ASIX) reported higher first-quarter 2026 sales but sharply lower adjusted earnings as the chemical and fertilizer producer faced higher raw material costs, winter storm impacts and continued softness in some industrial end markets. On the company’s earnings call, President and Chief Executive Officer Erin Kane said AdvanSix “navigated a number of headwinds to deliver a solid first quarter performance,” citing winter storm-related disruption, geopolitical challenges and subdued industrial demand. The company generated 7% year-over-year sales growth, supported by stronger chemical intermediates volumes and improved plant nutrients pricing. → Light Speed Returns: Corning Cashes In on NVIDIA Growth However, Kane said margin pressure from higher sulfur and natural gas costs offset much of that benefit. The company is working to recover inflationary input costs through a combination of pass-through formulas and negotiated pricing mechanisms. Christopher Gramm, vice president of corporate finance and strategic financial planning and analysis, said first-quarter sales were $404 million, up about 7% from the prior year. That increase included 6% volume growth and a 1% favorable price impact. → Uber's Annual Product Showcase Reveals It Is Coming for Airbnb and Booking Gramm said the volume gain was primarily driven by chemical intermediates sales. Market-based pricing improved 3%, led by plant nutrients amid higher nitrogen pricing and increased sulfur input costs. Raw material pass-through pricing declined 2% due to lower net benzene and propylene costs. Adjusted EBITDA was $5 million, down $47 million from the prior-year period. Gramm attributed the decline to several factors, including the absence of $26 million in insurance proceeds received in the prior year, higher sulfur and natural gas costs, increased utility expenses and $11 million in winter storm-related impacts. → Wells Fargo’s Comeback Is Real—But Not Risk-Free Kane said the storm-related earnings impact came in slightly above the high end of the company’s expected range, though AdvanSix was able to save $3 million of planned turnaround expense for the year. Free cash flow was a seasonal use of cash in the quarter, as expected, primarily reflecting the timing of capital spending payments following prior-quarter outages. Gramm said the absence of insurance proceeds also contributed to the year-over-year change. Management said it anticipates significant sequential earnings and cash flow improvement in the second quarter. Gramm said AdvanSix expects to recover a large portion of the first-quarter raw material cost shortfall in the second quarter, particularly during the domestic planting season for plant nutrients. The company maintained its full-year capital expenditure outlook of $75 million to $95 million, with nearly 20% targeted toward high-return growth investments. Kane also said AdvanSix continues to expect debt leverage ratios near the low end of its target range of 1.0 times to 2.5 times by year-end. AdvanSix is also focused on cost productivity, working capital discipline, turnaround execution and full-year free cash flow generation. Kane pointed to non-manpower fixed cost savings, risk-based capital prioritization and 45Q carbon capture tax credits as areas supporting cash flow improvement. Kane said agricultural and fertilizer remains the company’s largest end market. Domestic granular sales for the current fertilizer year are now expected to be near record levels but closer to flat compared with the prior fertilizer year. She said the fertilizer year began with optimism and a strong fall fill, but buying became more cautious due to challenged farmer profitability, input affordability, cold spring weather and drought conditions. AdvanSix is now selling in-season tons, giving it an opportunity to recover higher sulfur input costs. Kane said ammonium sulfate pricing actions are “largely offsetting sulfur input costs rather than driving margin expansion” in the current environment. Sulfur prices have risen sharply. Kane said quarterly sulfur prices settled at a record $655 per long ton for the second quarter of 2026, up more than 30% sequentially and roughly 140% year over year. Spot prices were trading even higher at the time of the call. During the question-and-answer session, Kane said AdvanSix purchases sulfur entirely on the contract market and does not have supply security concerns because it buys in North America. She added that sulfur pricing could remain “higher for longer,” even if geopolitical tensions ease. Kane also said the company has been maximizing ammonia availability this spring while slightly moderating ammonium sulfate production. She described direct ammonia sales as a “moderate lever” and said growers continue to need nitrogen, phosphorus, potassium and sulfur. In nylon solutions, Gramm said resin volumes improved sequentially due to better operational performance, while caprolactam volumes moderated amid soft demand, particularly in carpet applications. The company saw a higher export mix in the quarter, which it expects to continue near term. Kane said North American demand across building and construction and engineering plastics has not materially changed. However, global pricing has moved higher due to capacity rationalization and raw material shortages in Europe, lower operating rates in China, logistics constraints and higher input costs. She said reduced imports have created share-gain opportunities, and AdvanSix is focused on pricing, mix, export opportunities and reducing nylon resin inventories to align with market conditions. In chemical intermediates, Gramm said sales improved on stronger year-over-year volumes. He noted that acetone demand benefited from more normalized downstream MMA operating rates after extended plant outages in the prior year. Kane said phenol demand remains soft overall, but reduced acetone imports into the U.S. are supporting tighter acetone supply-demand dynamics. AdvanSix also announced a process design and licensing agreement to assess an expansion of its integrated ammonia platform at its Hopewell, Virginia, facility to support domestic manufacturing of diesel exhaust fluid, or DEF. Kane said DEF is an EPA-mandated additive used to reduce nitrogen oxide emissions from diesel engines, with demand driven primarily by Class 8 vehicle usage in the Mid-Atlantic and Northeast. She said demand is growing as regulatory requirements expand across transportation, construction, agriculture and industrial equipment fleets. The Hopewell facility already produces all required DEF inputs, Kane said. She added that the project would complement the site’s existing manufacturing capabilities while maintaining the company’s commitment to ammonium sulfate fertilizer production. In response to an analyst question, Kane said the DEF project is expected to be larger than the company’s SUSTAIN program, though she declined to provide a capital cost range while engineering and negotiations are underway. She said AdvanSix targets internal hurdle rates above 20% IRR for high-return growth and cost-savings projects, and that the DEF project fits within that range. Kane said the project does not require an ammonia expansion, though the company routinely evaluates marginal ammonia debottlenecking opportunities. A final investment decision is targeted for the first half of 2027, with expected startup in 2029 if the project proceeds. AdvanSix also highlighted a leadership transition, with Patrick Day joining as senior vice president and chief financial officer effective April 27. Kane thanked Gramm for serving as interim CFO over the past year. On 45Q carbon capture tax credits, Gramm said the IRS audit process for credits from 2018 through 2020 is underway, with field work expected to wrap up in the second quarter. The company expects approximately $18 million in proceeds in the second half of the year, subject to IRS approval, after previously receiving $2 million of the roughly $20 million total value. AdvanSix, Inc (NYSE: ASIX) is an integrated chemical manufacturer specializing in the production of nylon 6 intermediates and related co‐products. Established as a publicly traded spin‐off from Honeywell Specialty Chemicals in June 2016, the company is headquartered in Parsippany, New Jersey. The company’s principal product is caprolactam, the key building block for nylon 6 resin, used in fibers and engineering plastics across industries. In addition to caprolactam and nylon 6 resin, AdvanSix produces ammonium sulfate fertilizer and industrial chemicals such as phenol and acetone. The article "AdvanSix Q1 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for May 2026.

Image source: The Motley Fool. May 8, 2026 President and Chief Executive Officer — Erin N. Kane Senior Vice President and Chief Financial Officer (Interim) — Christopher Gramm Vice President, Investor Relations — Adam Kressel Senior Vice President and Chief Financial Officer — Patrick Day Need a quote from a Motley Fool analyst? Email [email protected] Erin N. Kane: Thanks, Adam, and good morning, everyone. We appreciate you joining us here today for our quarterly call. As you saw in our press release, the AdvanSix Inc. team navigated a number of headwinds to deliver a solid first quarter performance, including the earlier winter-storm-related impacts, and new geopolitical challenges amid continued subdued industrial end market demand. In the quarter, we generated 7% sales growth year over year, supported by improvements in chemical intermediates volume and plant nutrients market pricing, partially offsetting the margin impacts driven by increased sulfur and natural gas costs. We are executing with a focus to recover inflationary raw material input costs by leveraging both our pass-through formula and freely negotiated pricing mechanisms. I would like to thank all of our teammates who contributed to successfully maintaining safe operations during the winter storm earlier this year. While the earnings impact related to this event came in just above the high end of our anticipated range, we were able to save $3 million of planned turnaround expense for the year. Looking ahead, we anticipate significant sequential earnings and cash flow improvement into the second quarter. We are in a solid position as the domestic planting season progresses, and continue to operate amid a tightening acetone global supply and demand environment and a modestly recovering nylon industry. We are maintaining a disciplined focus on cost productivity, capital spending, turnaround execution, and full-year free cash flow generation. We continue to expect full-year CapEx in the range of $75 million to $95 million, with targeted allocation of nearly 20% of that toward high-return growth investments. We also continue to expect debt leverage ratios near the low end of our target range of 1.0 to 2.5 times by the end of this year. Key to our strategy is a keen focus on controllables to support through-cycle profitability and cash conversion while progressing targeted growth strategies and initiatives. We announced yesterday an exciting new opportunity to expand our integrated ammonia platform at our Hopewell, Virginia site to supply the growing regional diesel exhaust fluid (DEF) market. I will share more about this later in the call. Lastly, effective April 27, we welcomed Patrick Day as our new Senior Vice President and Chief Financial Officer. Pat has tremendous experience establishing corporate and financial strategies to accelerate growth and shareholder value. We look forward to his expertise as we advance into our next chapter. I would also like to thank Christopher Gramm for his commitment and support during his time as interim CFO over the last year. With that, I will turn it to Christopher to discuss the financials. Christopher Gramm: Thanks, Erin. I am now on Slide 4 to discuss our results for the quarter. Sales of $[inaudible] in the quarter increased approximately 7% versus the prior year, comprised of 6% volume growth and 1% favorable price. Sales volume growth was primarily driven by favorable chemical intermediates sales. Market-based pricing improved by 3%, primarily driven by an increase in plant nutrients reflecting higher nitrogen pricing amid increased sulfur input costs. Raw material pass-through pricing was down 2% following a net cost decrease in benzene and propylene, which is a major input to cumene, our largest raw material and key feedstock to our products. Adjusted EBITDA was $5 million, down $47 million from last year, primarily driven by the absence of insurance proceeds from the prior year of $20 million, the unfavorable impact of higher sulfur and natural gas raw material prices, higher utility expenses, and $11 million of winter-storm-related impacts. On a sequential basis compared to the fourth quarter, higher sales volume growth supported by improved operational performance was more than offset by escalating raw material input prices. From a free cash flow perspective, the first quarter represents a seasonal use of cash as expected, primarily due to the timing of cash payments for CapEx following the prior quarter outages. The absence of insurance proceeds was also a meaningful driver of the year-over-year change. We continue to anticipate sequential improvement into the second quarter and expect the second half of the year to be a source of cash to achieve our full-year expectations. Now let us turn to Slide 5. On this slide, we are detailing our quarterly sales contributions by product line, as well as price and volume indicators, both year over year and sequentially. In light of the significant raw material inflation and the mix of our formula or index-based pricing mechanisms, we did not fully cover those costs in the first quarter. However, we anticipate recouping a large portion of that shortfall in the second quarter, particularly into the heart of the domestic planting season for plant nutrients. Starting with Nylon Solutions, resin volumes improved sequentially on improved operational performance, while caprolactam volumes moderated in a soft demand environment, particularly for carpet applications. We saw a higher export mix in 2026 which is expected to continue in the near term. With our advantaged position, we are evaluating export opportunities to ensure the best economic output for the integrated enterprise. Domestic pricing steadily increased overall, supported in part by higher input costs. Plant nutrient volumes were flat to down both year over year and sequentially in the first quarter, while pricing strength continued. In the early parts of the year, we witnessed more cautious buying behavior down the value chain and a more risk-averse sentiment from customers amid the higher input costs and rapidly rising nitrogen prices. Lastly, chemical intermediates sales improved on the back of volume improvements year over year. In acetone, as we mentioned on the first quarter 2025 earnings call, downstream MMA saw extended plant outages last year. In 2026, we observed more normalized operating rates down the value chain supporting demand. In addition, given pricing dynamics and trade flows across our key products in this portfolio, we delivered on opportunistic spot sales domestically and in the export markets. Thanks, Erin. I am now on Slide 6 to discuss what we are seeing across our major product lines. Erin N. Kane: Our diversified end market exposure continues to be a strategic advantage providing resilience across cycles. Agriculture and fertilizer remains our largest end market. As we sit here today, our domestic granular sales for this fertilizer year are now expected to be near record levels but closer to flat as compared to the last fertilizer year. While the fertilizer year started off with optimism and a strong fall fill as we have discussed in previous calls, buying has become more cautious given continued challenged fundamentals including farmer profitability and input affordability, cold weather to start the spring, and drought conditions. What that means is we are now selling in-season tons with the ability to work coverage of sulfur input costs. This is important because amid a higher global nitrogen pricing environment on the heels of the conflict in the Middle East, ammonium sulfate pricing actions are largely offsetting sulfur input costs rather than driving margin expansion in this current context. We know that growers value the cost of nutrition. In fact, ammonia for direct application is currently a relatively attractive value for growers. While we are not a large merchant ammonia supplier, we have seen good demand and netbacks and have been maximizing our ammonia availability this spring while slightly moderating ammonium sulfate production. While we capture the benefit from the advantage between U.S. natural gas and global nitrogen prices, we also contend with the impact of sulfur input costs versus the sulfur value proposition we deliver to farmers. On tightened global supply, sulfur quarterly prices settled at a record $655 per long ton in 2026, with current spot prices trading even higher than those levels. This represents over a 30% sequential increase and roughly a 140% surge year over year, so a meaningful increase that the industry is experiencing. Moving to our key nylon end markets, across building and construction as well as engineering plastics, North American demand has not materially changed. Global pricing has moved up with capacity rationalization and material shortages in Europe, lower operating rates in China, logistics constraints, and higher input costs. Our industry pricing mechanisms work to pass through changes in core raw materials, notably benzene, but also natural gas and sulfur. Given global trade flow dynamics, reduced imports have created opportunities to gain share. In this environment, it is critical for our business to remain agile through pricing and mix. We continue to execute our plan, including taking advantage of export opportunities as they arise, increasing prices to offset cost increases, and reducing inventory levels for nylon resin to align with current market conditions. In chemical intermediates, phenol demand remains soft overall, driving lower global operating rates. Coupled with reduced acetone imports into the U.S., all of this is supporting tightening acetone supply and demand dynamics. Acetone price increases have been implemented in the industry to keep pace with rising propylene costs. Spreads have held near cycle averages, and we continue to anticipate that for the full year 2026. Let us move to Slide 7. We were excited to announce yesterday that we have entered into a process design and licensing agreement to assess expansion of our integrated ammonia platform to enable the domestic manufacturing of DEF, a critical emissions control product used across on- and off-highway diesel applications. As background, DEF is an EPA-mandated additive for reducing NOx emissions from diesel engines, with strong and growing demand driven primarily by Class 8 vehicle usage in the Mid-Atlantic and Northeast. Demand for DEF continues to grow to meet environmental standards, and as regulatory requirements expand across transportation, construction, agriculture, and industrial equipment fleets. The AdvanSix Inc. Hopewell facility provides a strong foundation for expanding domestic manufacturing at the site and already produces all required DEF inputs. This potential expansion would complement existing capabilities at the site with full continued commitment to the production of ammonium sulfate fertilizer to serve the U.S. farming industry. Our geographic position uniquely enables reliable supply to meet growing demand in a market currently served by imports and production from other domestic regions. Our investments over time with our ammonia unit operation have paid off in terms of our reliability and output. This project has the potential to unlock further value from our existing assets through increased optionality to serve a broadened customer base. We will advance through detailed engineering and development phases with final investment decision targeted for 2027. Additional updates will be provided as engineering, commercial, and financial milestones are achieved, and regulatory approvals are secured. We anticipate a multi-year capital investment supporting attractive financial returns following expected operational startup in 2029, which align with our long-term value creation objectives and commitment to disciplined capital allocation. Let us turn to Slide 8 before moving to Q&A. AdvanSix Inc. offers a compelling investment thesis with value drivers supporting through-cycle profitability and sustainable performance. Our strategic initiatives and unique combination of assets and business model are core to our durable competitive advantage and long-term positioning. Our global low-cost position and vertically integrated caprolactam production serve us well. In addition, a sulfuric acid platform integration coupled with a leading technology position underpins how we win in plant nutrients. We are progressing our sustained ammonium sulfate growth program and have now announced another high-return investment opportunity to serve the growing DEF market. These capabilities, combined with increasing asset operational agility and diversified products and end market mix, position us to navigate cycles and capitalize on emerging opportunities. We remain focused on delivering on controllable levers, including our non-manpower fixed cost savings program, risk-based prioritization of our capital investments, continued working capital discipline, and 45Q carbon capture tax credits, to support improved cash flow generation. With that, Adam, let us move to Q&A. Adam Kressel: Thanks, Erin. Danielle, can you please open the line for questions? We will now open the call for questions. Operator: Thank you. We will now begin the question and answer session. Using a speakerphone, please pick up your handset before pressing the keys. The first question comes from Pete Oesterlin from Truist Securities. Please go ahead. Pete Oesterlin: Hey, good morning. Thanks for taking the questions. Just wanted to start on the DEF ammonia project. I guess, do you have a rough estimate you can share for the capital intensity you expect for this project between now and 2029? And maybe how does the hurdle you are targeting at this point compare to other programs you have had, like Sustain, and the IRRs you have referenced there? Erin N. Kane: Thanks, Pete. Good morning, and appreciate the question. At this time, I would share that we would expect the CapEx for this program certainly to be larger than our Sustain program. Hopefully, you can appreciate that while we are investigating and doing our FEED process, we are having a number of negotiations with folks and, at this time, would keep the actual CapEx range a bit confidential—more to come there. But you can think about it certainly as a larger program than Sustain. That said, our internal targets, as we have shared for high-return growth and cost savings projects, are 20%+ IRR hurdle rates. This project fits well into that range, and we are certainly announcing it now given the fact that this continues to demonstrate real potential for the company. Pete Oesterlin: Very helpful. Thanks. And then, switching gears, when you think about the level of sulfur pricing that you are guiding to for the second quarter, is it your expectation at this point that prices should be at or above that level for the remainder of the year? Even if the Iran conflict ended very soon, how long would you expect until you start seeing some easing for the dynamics that are driving higher prices in that market? Erin N. Kane: You are probably aware that spot prices continue to trade higher than the Q2 settlement. Certainly, as we think about the Q3 settlement that will come in a couple of months—it is settled by two large phosphate producers here in the U.S. and their three largest suppliers. But I think, consistent with what you are probably hearing with others in this space, even if we have a resolution in the Middle East, there is quite a bit of time for things to settle back out. I can share that security of supply is not a consideration for us, seeing that we are buying here in North America. Certainly, there is a lot of sulfur—about 50% of world supply—coming from the Middle East, but we are in a great spot being a North American producer and purchaser. Pricing probably does stay higher for longer. Then we will have to see what it does for demand into its largest applications. Just over 50% of the world’s sulfur goes into phosphate fertilizer. Watching that will be key compared to what we see. But we feel good about our sequential opportunity to recover, and that has been our focus as we progress through Q2. Operator: The next question comes from David Silver from Freedom Capital Markets. Please go ahead. David Silver: Let me just get my questions in order here. I did want to go back to the sulfur question and a couple of your comments regarding ammonium sulfate. I think you mentioned that ammonium sulfate prices are increasing but more or less in line with the rise in sulfur costs. I am wondering—you talked about kind of balanced markets, whereas for most nitrogen fertilizer products, it is somewhat different supply-demand; it is very tight. You do have a very strong vertically integrated production structure. What kind of in-season flexibility do you think you have to maybe exploit some pretty big price differentials amongst the different nitrogen fertilizer products? You have looked at these markets for quite a while. Why not tilt or lean on direct ammonia sales and a little bit less of the ammonium sulfate here? Erin N. Kane: Thanks for that question, David. Hopefully that was teased out a bit in our remarks. We are a big producer and a leader in ammonium sulfate, and that is certainly a place we will continue to play. With ammonium sulfate, we do capture the differential between where nitrogen is priced and our U.S. natural gas position. We also can have that directly in our ammonia sales as well. I would say right now, it is a moderate lever. We can pull back a bit on our ammonium sulfate production. We continue, as we shared last year, to produce ammonia at historically high levels, and then, relative to what we are targeting to sell, that would be consistent with that. Farmers need NPK. They need sulfur. There is a value proposition for sulfur, and we continue to focus on ensuring that they have their needs met there as well. This situation right now, compared to perhaps Ukraine and Russia, has us contending with sulfur. Farmers do seem to be sticking more with ammonia for direct application, and we are looking to take advantage of that too and provide the opportunity that we have off our assets to do so. David Silver: Okay. I am going to follow up with a couple of targeted questions. Firstly, you did talk about the sulfur market. You did talk about your positioning and being able to get all the sulfur that you require. But there is—I am guessing it is unprecedented—this gap between the spot price of sulfur and the contract price of sulfur. I just wanted to clarify that AdvanSix Inc. is able to purchase at the contract price—the lower contract price—under your current supply agreements rather than some mix of contracts and spot pricing. Can you touch on your supply arrangements for sulfur and, in particular, how tight the relationship is between the U.S. contract price versus having to go out into the spot market? Erin N. Kane: I can confirm that we purchase entirely on the contract marker. David Silver: Okay, great. Thank you for that. I did want to follow up maybe on the DEF project—very interesting project and leveraging some of your capabilities. I read the release the other day and then your comments in the prepared remarks. You are going to be adding some urea melt capacity there. Will you also be debottlenecking ammonia? In other words, are you going to have a higher ammonia capacity once the project is finished than you currently have, or how should I think about that in terms of allocating ammonia amongst the nylon, the fertilizer, and now the DEF? Erin N. Kane: This next phase does not require an ammonia expansion. Given our geographical location and our integrated platform, we always look at marginal ammonia debottlenecking, but for DEF we do not need to expand ammonia for the purposes of the project. David Silver: Okay. Very good. Last one for me: I would like to get an update on the Section 45Q credits. I am guessing that the filing for the 2018–2020 period for roughly $20 million has not been received yet. Can you provide an update on that? And then, do you anticipate filing for an additional tranche of the credits to which you are entitled in the current fiscal year? Should we think about that maybe in the $20 million range as well? Christopher Gramm: David, thanks for that question. As you can imagine, there has been a lot of continuing activity around 45Q. We have the audit process underway with the IRS for the 2018 through 2020 years of credit. We anticipate field work being wrapped up in the second quarter, and we are making good progress on the audit itself. In terms of the timing of the cash—and while $20 million was the full value—we have already received $2 million of that in prior years. We are anticipating another $18 million. We would expect the proceeds for that in the second half, subject to IRS approval, but we are expecting that in the second half. In terms of the life cycle assessment for the 2021 year and following, we have submitted those to the DOE, and we are working now with the DOE and the IRS to get those certified. Just as a reminder, we have been at this for over five years, and so this process takes some time as we work through with the government to get their approval and the due diligence that they do. Hopefully those will be coming shortly, but that is the process and where we are. David Silver: Okay. Great. Thank you for the update. Erin N. Kane: Thanks, David. Operator: This concludes our question and answer session. I would like to turn the conference back over to Erin N. Kane for closing remarks. Erin N. Kane: Thank you all again for your time and interest this morning. As we move through the remainder of 2026 and navigate a dynamic environment, we are well positioned to support our strategic priorities as a U.S.-based integrated manufacturer aligned to domestic supply chains and energy, as well as a diverse set of end market applications. We look forward to speaking with you again next quarter. Stay safe and be well. Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect. Before you buy stock in AdvanSix, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and AdvanSix wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $475,926!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,296,608!* Now, it’s worth noting Stock Advisor’s total average return is 981% — a market-crushing outperformance compared to 205% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of May 8, 2026. 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Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Performance was driven by 7% sales growth, supported by chemical intermediates volume and plant nutrients pricing, though offset by significant sulfur and natural gas cost inflation. The company is leveraging a mix of formula-based pass-throughs and negotiated pricing to recover raw material costs, with a large portion of the Q1 shortfall expected to be recouped in Q2. Winter-storm-related impacts reached $11 million, slightly above the high end of expectations, though the team successfully mitigated costs by saving $3 million in planned turnaround expenses. Plant nutrients saw cautious buying behavior due to farmer profitability concerns and drought conditions, leading to a shift toward selling in-season tons to better manage sulfur input volatility. Chemical intermediates benefited from normalized operating rates in downstream MMA and opportunistic spot sales in a tightening acetone supply environment. Nylon Solutions is managing a soft demand environment for carpet applications by increasing export mix and aligning resin inventory levels with current market conditions. Management anticipates significant sequential earnings and cash flow improvement in Q2 as the domestic planting season progresses and pricing actions take effect. Full-year CapEx is projected between $75 million and $95 million, with approximately 20% allocated to high-return growth investments targeting 20%+ IRR hurdle rates. The company expects to reach the low end of its 1.0 to 2.5 times debt leverage target range by the end of 2026. The second half of the year is expected to be a primary source of cash flow to meet full-year expectations, supported by seasonal working capital improvements. A new Diesel Exhaust Fluid (DEF) expansion project is targeted for a final investment decision in 2027, with operational startup expected in 2029. Announced a process design agreement to expand the Hopewell ammonia platform for DEF production, targeting the growing Mid-Atlantic and Northeast diesel markets. Sulfur input costs surged roughly 140% year over year, with quarterly settlements reaching a record $655 per long ton, creating a significant margin headwind. The absence of $20 million in insurance proceeds received in the prior year created a meaningful year-over-year EBITDA comparison gap. Section 45Q carbon capture tax credits for 2018–2020 are currently under IRS audit, with $18 million in cash proceeds anticipated in the second half of 2026. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management confirmed the DEF project will be larger in scale than the previous 'Sustain' program but declined to provide a specific CapEx range during current negotiations. The project is expected to meet or exceed the company's internal 20%+ IRR hurdle rate for high-return growth investments. Management expects sulfur prices to stay 'higher for longer' even if Middle East conflicts resolve, due to the time required for global trade flows to rebalance. AdvanSix maintains a secure supply position by purchasing entirely on North American contract markers rather than relying on the volatile spot market. The company is currently maximizing ammonia availability for direct application to capture better netbacks while slightly moderating ammonium sulfate production. This tactical shift allows the company to exploit the value differential between U.S. natural gas and global nitrogen prices while managing high sulfur input costs. The DEF project will utilize existing ammonia capacity and does not require a foundational ammonia unit expansion, though marginal debottlenecking is always considered. The site already produces all required inputs for DEF, allowing the project to leverage the existing integrated platform at Hopewell.

1Q26 Sales of $404 million, up 7% versus prior year 1Q26 Earnings Per Share of ($0.58); Adjusted Earnings Per Share of ($0.50) 1Q26 Cash Flow from Operations of ($15) million Evaluating Expansion of Integrated Ammonia Platform to Meet Growing Regional Demand for Diesel Exhaust Fluid (DEF) Appointed Patrick Day as SVP and CFO, effective April 27th PARSIPPANY, N.J., May 08, 2026--(BUSINESS WIRE)--AdvanSix (NYSE: ASIX), a vertically integrated chemistry company serving diverse end markets, today announced its financial results for the first quarter ending March 31, 2026. Overall, the Company navigated a dynamic market environment while progressing on key growth, cost savings and strategic initiatives. First Quarter 2026 Summary "The AdvanSix team delivered a solid first quarter performance consistent with our expectations while navigating a number of headwinds, including the early quarter winter storm-related impacts and new geopolitical challenges amid continued subdued industrial end market demand," said Erin Kane, president and CEO of AdvanSix. "We generated 7% sales growth year-over-year, supported by improvements in Chemical Intermediates volume and Plant Nutrients market pricing, partially offsetting the margin impacts driven by increased sulfur and natural gas costs. We remain well positioned to serve our customers across our diversified portfolio including fertilizer as the domestic planting season progresses, in chemical intermediates amid a tightening acetone global supply and demand environment, and across a modestly recovering nylon industry supporting expected meaningful sequential performance improvement into the second quarter." Summary first quarter 2026 financial results for the Company are included below: Sales of $404 million in the quarter increased approximately 7% versus the prior year comprised of 6% volume growth and 1% favorable price. Sales volume growth was primarily driven by favorable Chemical Intermediates sales. Market-based pricing improved by 3% primarily driven by an increase in Plant Nutrients reflecting higher nitrogen pricing amid increased sulfur input costs. Raw material pass-through pricing was down 2% following a net cost decrease in benzene and propylene (inputs to cumene which is a key feedstock to our products). Sales by product line and approximate percentage of total sales are included below: Adjusted EBITDA of $4.8 million in the quarter decreased $46.9 million versus the prior year primarily driven by the absence of $26 million of prior year insurance proceeds, the unfavorable impact of higher sulfur and natural gas raw material prices, and higher plant costs primarily driven by utilities costs and $11 million of winter storm impact. Adjusted earnings per share of ($0.50) decreased $1.43 versus the prior year driven primarily by the factors discussed above. Cash flow from operations of ($15.3) million in the quarter decreased $26.8 million versus the prior year primarily due to lower net income including the impact of insurance proceeds, partially offset by net changes in working capital. Capital expenditures of $35.9 million in the quarter increased $1.9 million versus the prior year, as expected. Outlook Anticipate balanced U.S. ammonium sulfate supply and demand fundamentals in heart of domestic planting season amid meaningfully higher sulfur input costs Acetone spread over propylene costs expected to hold near cycle averages for the full year 2026 Continue to optimize Nylon Solutions production output, inventories and sales volume mix in extended soft industrial end market environment Continue to expect Capital Expenditures of $75 to $95 million in 2026 versus approximately $116 million in 2025, reflecting risk-based prioritization of base investments and enterprise programs with continued progression of growth programs including SUSTAIN Now expect pre-tax income impact of plant turnarounds to be $17 to $22 million in 2026 versus approximately $25 million in 2025 Expect cash flow benefit in 2026 and beyond from 45Q carbon capture tax credits and 100% bonus depreciation Integrated Ammonia Platform - Diesel Exhaust Fluid (DEF) Growth Project AdvanSix announced yesterday it has entered into a process design and licensing agreement to assess expansion of its integrated ammonia platform at its Hopewell, Virginia site to supply the growing DEF market. Leveraging its integrated ammonia operations, manufacturing capabilities of required feedstocks and advantaged geographic location, the Company is well positioned to provide reliable, domestic supply into a high‑demand regional market, with no expected impact to ammonium sulfate fertilizer production. The Company is progressing through Front End Engineering and Design (FEED) work with a final investment decision targeted for the first half of 2027. The Company anticipates a multi-year capital investment supporting attractive financial returns, which align with the Company's long-term value creation objectives, following expected operational start up in 2029. "Our strategic initiatives, unique combination of assets and business model are core to our durable competitive advantage and long-term positioning. Our global low-cost position in vertically integrated caprolactam production serves us well. In addition, ammonia and sulfuric acid platform integration coupled with a leading granular crystallization technology position underpins how we win in Plant Nutrients. We are progressing our SUSTAIN ammonium sulfate growth program and have now announced another high-return growth opportunity to further expand through our core assets to serve the growing DEF market. These capabilities, combined with our asset utilization agility and diversified product and end market mix, position us to navigate cycles and capitalize on emerging opportunities. We remain focused on delivering on controllable levers including our non-manpower fixed cost savings program, risk-based prioritization of our capital investments and carbon capture tax credits to support through-cycle profitability and improved cash flow generation," concluded Kane. Dividend The Company's Board of Directors declared a quarterly cash dividend of $0.16 per share on the Company's common stock. The dividend is payable on June 2, 2026 to stockholders of record as of the close of business on May 19, 2026. Conference Call Information AdvanSix will discuss its results during its investor conference call today starting at 9:30 a.m. ET. To participate on the conference call, dial (844) 855-9494 (domestic) or (412) 858-4602 (international) approximately 10 minutes before the 9:30 a.m. ET start, and tell the operator that you are dialing in for AdvanSix’s first quarter 2026 earnings call. The live webcast of the investor call as well as related presentation materials can be accessed at http://investors.advansix.com. Investors can hear a replay of the conference call from 12 noon ET on May 8 until 12 noon ET on May 15 by dialing (855) 669-9658 (domestic) or (412) 317-0088 (international). The access code is 2291728. About AdvanSix AdvanSix is a vertically integrated chemistry company that produces essential materials for our customers across diverse end markets. Our value chain of our five U.S.-based manufacturing facilities plays a critical role in global supply chains and enables us to innovate and deliver essential products for our customers across building and construction, fertilizers, agrochemicals, plastics, solvents, packaging, paints, coatings, adhesives, electronics and other end markets. Guided by our core values of Safety, Integrity, Accountability and Respect, AdvanSix strives to deliver best-in-class customer experiences and differentiated products in the industries of nylon solutions, plant nutrients, and chemical intermediates. More information on AdvanSix can be found at http://www.advansix.com. Forward Looking Statements This release contains certain statements that may be deemed "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, that address activities, events or developments that our management intends, expects, projects, believes or anticipates will or may occur in the future are forward-looking statements. Forward-looking statements may be identified by words such as "expect," "anticipate," "estimate," "outlook," "project," "strategy," "intend," "plan," "target," "goal," "may," "will," "should" and "believe" and other variations or similar terminology and expressions. Although we believe forward-looking statements are based upon reasonable assumptions, such statements involve known and unknown risks, uncertainties and other factors, many of which are beyond our control and difficult to predict, which may cause the actual results or performance of the Company to be materially different from any future results or performance expressed or implied by such forward-looking statements. Such risks and uncertainties include, but are not limited to: general economic and financial conditions in the U.S. and globally; the potential effects of inflationary pressures, tariffs or the imposition of new tariffs, trade wars, barriers or restrictions, or threats of such actions, changes in interest rates, labor market shortages and supply chain issues; instability or volatility in financial markets or other unfavorable economic or business conditions caused by geopolitical concerns, including as a result of new or proposed legislation or regulatory, trade or other policies in or impacting the U.S., the conflict between Russia and Ukraine, the conflicts in Israel, Gaza and Iran, and related uncertainty in the surrounding region, and the possible expansion of such conflicts; the effect of any of the foregoing on our customers’ demand for our products and our suppliers’ ability to manufacture and deliver our raw materials, including implications of reduced refinery utilization in the U.S.; our ability to sell and provide our goods and services; the ability of our customers to pay for our products; any closures of our and our customers’ offices and facilities; risks associated with increased phishing, compromised business emails and other cybersecurity attacks, data privacy incidents and disruptions to our technology infrastructure; risks associated with potential use of artificial intelligence in our operations or those of third party service providers; risks associated with operating with a reduced workforce; risks associated with our indebtedness including compliance with financial and restrictive covenants, and our ability to access capital on reasonable terms, at a reasonable cost, or at all, due to economic conditions or otherwise; the impact of scheduled turnarounds and significant unplanned downtime and interruptions of production or logistics operations as a result of mechanical issues or other unanticipated events such as fires, severe weather conditions, natural disasters, pandemics, geopolitical conflicts and related events; price fluctuations, cost increases and supply of raw materials; our operations and growth projects requiring substantial capital; growth rates and cyclicality of the industries we serve including global changes in supply and demand; failure to develop and commercialize new products or technologies; loss of significant customer relationships; adverse trade and tax policies; extensive environmental, health and safety laws that apply to our operations; hazards associated with chemical manufacturing, storage and transportation; litigation associated with chemical manufacturing and our business operations generally; inability to acquire and integrate businesses, assets, products or technologies; protection of our intellectual property and proprietary information; prolonged work stoppages as a result of labor difficulties or otherwise; failure to maintain effective internal controls; our ability to declare and pay quarterly cash dividends and the amounts and timing of any future dividends; our ability to repurchase our common stock and the amount and timing of any future repurchases; disruptions in supply chain, transportation and logistics; potential for uncertainty regarding qualification for tax treatment of our spin-off; fluctuations in our stock price; and changes in laws or regulations applicable to our business. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. Such forward-looking statements are not guarantees of future performance, and actual results, developments and business decisions may differ materially from those contemplated by such forward-looking statements as a result of a number of risks, uncertainties and other factors including those noted above and those identified in our filings with the Securities and Exchange Commission (SEC), including the risk factors in Part 1, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2025, as updated in subsequent reports filed with the SEC. All subsequent written or oral forward-looking statements attributable to us or persons acting on our behalf are qualified in their entirety by this paragraph. We do not undertake to update or revise any of our forward-looking statements. Non-GAAP Financial Measures This press release includes certain non-GAAP financial measures intended to supplement, not to act as substitutes for, comparable GAAP measures. Reconciliations of non-GAAP financial measures to GAAP financial measures are provided in this press release. Investors are urged to consider carefully the comparable GAAP measures and the reconciliations to those measures provided. Non-GAAP measures in this press release may be calculated in a way that is not comparable to similarly-titled measures reported by other companies. View source version on businesswire.com: https://www.businesswire.com/news/home/20260507991919/en/ Contacts Media Janeen Lawlor (973) 526-1615 [email protected] Investors Adam Kressel (973) 526-1700 [email protected]