OEC - Earnings call 3 2023 | Orion Engineered Carbons S.A.

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Operator

Greetings, and welcome to Orion's Third Quarter Financial Results Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Wendy Wilson, Head of Investor Relations. Thank you, Wendy.

You may begin.

Wendy Wilson

Alicia. you, Thank and our everyone, Orion's call conference Good quarter welcome XXXX discuss third financial to morning, to results. I'm Wendy Relations. Wilson, Head of Investor me Painter, Glajch, Corning today Officer; With Jeff and Chief Chief Executive Officer. Financial are press our posted of also our presentation and slide issued market closed release We our Relations Investor yesterday, the to website. we the portion after

will referencing this be presentation We during the call.

subject today statements. begin, that uncertainties in some may comments our during are made described you These and like forward-looking of the actual those are remind on the to I'd call as Before our we the today's risks filings results to statements SEC, call. from the described differ with and

reconciled over call our to all as attached based most are made measures call statements forward-looking the revised I X. are on comparable of new during addition, circumstances release. table The press to All discussed statements the any not measures update non-GAAP financial to GAAP or forward-looking to November Painter. In obligated the expectations. Corning turn today, in now company is this directly will

Corning Painter

Wendy. Good our you for everyone, today. Thank you, and call morning, thank joining

we XXXX. adjusted ever of adjusted Slide you for delivered year As remain have both results of $X.XX, growth EPS We diluted third EBITDA quarter in results on posted and highest on we third of quarter another $XX record and track can X, see million figures. second the for

of record EBITDA $X.XX. X-month also $XXX up this, Beyond EPS reported adjusted adjusted of X.X% million, we and diluted

ago is Our X XX-month million EBITDA short XXXX. X-month $X of just years entire million adjusted adjusted of our just $XXX EBITDA in

of same having we debt outstanding operating the shares. $XX cash in bought continued quarter total nearly level. third our strong At and flow delivered X% purchases XXXX, quarter reduced of also fourth million our since back share our time, the We

have milestones. operational We X

facility Wave operations First, continue to progressive. are qualifications, all greenfield China. up ever and first Customer ramp in we our sales

in this scheduled final controls the the our operational is to emission third quarter. upgrade now air happy U.S. for say that quarter. in I'm testing are we Second, progressed final and

important same at behind verge the will be It's of an to completing We on also great safety the having this us. be upgrade site.

As is quarter quarter. on sales. gross power impact negative and and terms on typical prices of some third lower projects impacts per also drove the these in will in both the specialty the had Europe quarter and with startups, drop the ton in This, of of fourth in this lower loading margins combined profit U.S.

specialty of a none our However, the of cast this strength business. shadow on

us. and support local and is fact, in for with We for better reactors the progress China customers can Europe our in In now this markets. those China important Chinese made U.S. products reallocate for

we I'd our the and process, talk appreciate the confidence German take the people of competitive and Another sources, the performance and greatly culture to black producing moment like German of as molecular important alternative for for recycling process funding the milestone from securing EU climate-neutral carbon an us and for This a to about of in tires. was pressure. developing a further and under was role government EU. such arduous

we disappointed. manufacturing delivered actually in is EBITDA firm. the As we team, of of the this our commitment the operate you say excellent X.X% Why? engagement year. results quarter resulting and the engagement using a the higher and Orion progressed know, would up set have difficult some economies year-to-date, I given this though adjusted high, we people a in. stronger challenges team We expected even this, bar to environment, is the measure manufacturing volumes third-party Despite Orion

firm. according improvement and since points a rare measure have to the this improved XXXX, We by huge accomplishment basis X,XXX a

to succeed thoughtfully Beyond universal a top an this, with I soft enabled priority. environment a near allocating along as customer focus despite believe us manufacturing that, team Orion the ever-changing capital consistently in reports world. has

You would very but as we high can financial as our They're in not compare paid has well we off to like, results. this see other manufacturers.

you great one a few here the companies, for follow our performance. remain testament on year-over-year This track other is know you of to stronger strategy. team that If we specialty are long-term chemical the and

economy On the reflecting the broader demand, specialty operations front, to manufacturing be subdued. continues

We our market. this qualifications, new as push new upgrade introduce to are using an the customer to opportunity plans, products

energy a and a achieved recently launch is our battery, wins producers address from and wire applications. and surge kappa produced is Europe good of soon upgraded of lithium in marks example It vehicles, electric for important batteries Asia. that have and conductive We consumer product markets. a XX, cable systems the PRINTEX announced existing recent will of demand Orion's been of of reactor that in in in A initially in an storage new coatings high-quality systems of portfolio additive expansion additives. number conductive ion The new have product

conductive innovation our ultimate and center are team. of In leadership views of the speed added addition, to the conversion days quarter, the battery and we to EV new mixed market. additional have opened in on additives the these size There the a

upside, continues restructuring the For are tightens I our this the however, and results in in earlier, the believe to Rubber, securing and Tire evident and product In us, Americas expand we will simply important this this of is mentioned market. profitably our capacity as and Europe, industry continue. is we confident market. nearly all in

Although truck with this robust underlying environment we've reflecting is the and seen trend less manufacturing traffic year, in some us. weakness a destocking

Carbon XXXX. Black Additionally, ban Russian the on begins EU midyear

While being rail business, doing and to have Carbon is trucks from recently that in imports large Russian model. Black business into into Russia was the that danger barred they of everyone ability from cars EU bought meaning reminding today, transfer one some revolting the distributor,

with Slide of an provide update me Let we think downstream, starting happening what X. is rubber on

you negative, to the on and being still improved that see while can quarter. First, bottom XX% page, from are down people the the trucking of has driving XX% last

I quarter. weakened the don't the up think a slide, anyone. Moving for in that's demand surprise OEM tire

tire while data, year-over-year USTMA volumes at U.S. the replacement car Finally, down and replacement truck weak, X% tire In general, shipments passenger according remain truck quarter. from light improved up significantly in were X% last the the top to being of have August. volumes slide,

tire that manufacturing is lagging recovery. However,

is Now all this data. on based U.S.

to However, we our the With of higher is I ask results. similar, perhaps level the financial additional picture higher imports. believe Jeff albeit that, in into would EU with continue provide insights to

Jeffrey Glajch

you, Corning. Thank Slide Starting on X.

we We representation to the good a In It XXXX have this grow at multiyear for midpoint volumes. a EBITDA expect growth. despite X% of now. slide of provides used couple visual XXXX, quarters versus our lower

substantial as ROCE investments. we the The cost capital. we and with ROCE, the the know, stands long-term average quarter, weighted our achieved which the rubber partly was third our you significantly Americas. At coming over keeps consolidated specialty flat progress China in quarter an Our volumes ROCE EMEA the which, in can in emissions our at continued in of On return new you the the of excess customers. a few The a XX%. online, metric aligned revenue, see the Volume made years quarter. company. is the air was were oil employed, the capacity key due control levels This to of X, by in results shareholders our to improvements as on in past price pricing, offset offset during has or time Slide with pass-through capital of when their with in decrease trailing sustainability the XX-month us due lower increase third stewards capital and to conclusion our lower of contractual in in

this XXXX in were to were our We year's also in profitability affected metrics GP The the to as headwinds we extremely per our had earnings prices because down was there quarter electric of metrics each EMEA be last close of knew on in was the drag gross third level, high Cogeneration a profit profitability likely it While startup ton quarter. in Europe. comparable mentioned back business. August. significant and

cogeneration absorption Slide for shows than the cost price EPS had This higher more as lower significant price/mix cost QX in EBITDA mentioned, quarter revenue specialty. pass-through Specialty I in offset the still contractual in up third well was and tamped despite as EBITDA from by results per The benefit pricing. sum year in first drop EBITDA sold contractual down oil high the in Slide benefited ever, half Despite each prices X%. volume to Europe down increased by cogeneration X, that On were latter headwinds, On QX last drop profit GP the just of these previously. count. gain solid. X% of XXXX. versus this gains partly had China. X, in The our in we some per adjusted was quarter We profitability had or relative The and across the of And this revenue of the diluted in $XX due a we contractual improvement X behind seen profit which Slide second new lower driven that lowered in gross drove these most were gross GP and mentioned the volume achieved as adjusted Weaker our was the over adjusted was in third million per markets power QX of profitability, provides dropped decreases rubber up QX, these Year-to-date summer. rubber extraordinary gains Corey stronger quarter by ton headwinds the as primarily the company. volume approximately up to pricing volumes, $X.XX. X% XXXX Finally, power year. lower was million plant ton prices the $X in highest the last by pricing year-to-date issues mitigated ton.

with continued ton last cogeneration well in subdued geographic the level as remained markets the to profit mix other relatively decreased sales compared as demand both lower Our due and profitability. the of those end in geographies. market Gross softness QX year to per due

key has that mix in the XX specific our the factors continued Slide the specialty remain the compared last for to for Importantly, stable. quarter, adjusted year. shows of business pricing we EBITDA products with affecting sold

absorption. mix as QX contractual by to the decrease experienced driven Americas. increases. was fixed rubber reduction the We As gross affected in by cogeneration volume significant Slide noted price adversely and demand per XX, ton results the earlier, some in lower and and affected profitability EMEA GP cost profit On higher

and be ton was will lower QX year, low factors for we still above point the key the clearly in partially the The rubber business. Slide pricing the this fourth lower which, level affecting in XXXX the well was EBITDA related However, shows expect past the XX the likely adjusted to $XXX, quarters, while of contractual was revert GP cogeneration the than it for impacts QX was Strong per level XXXX X driver. profitability the QX offset $XXX quarter. $XXX. and quarter. by key start-up above

cogeneration improved reduced see end increase lower and We effect volume lower Slide XX, a customer combination and markets. by purchases believe is offset debt. into of the European cash the was imports that can profitability. our tire you fewer has this of on flow had our much However, volume On an in

reduced million. We $XXX our by have of months in $XXX X to net million the XXXX debt first

now down ratio stands mid-XXXX. Xx debt-to-EBITDA X.XXx, Our at nearly from in

have QX X% XXXX. This worth and this repurchased we shares stock. buybacks share of program outstanding We since $XX represents million year nearly our also late started million our of $XX in in

of We will flow. shares with portion to look our continue repurchase free to cash opportunistically a

in company's million facility, The intentionally flow. EUR EUR XX%. that and has result we the by a we secured oversubscribed fourth from stronger X-year renewed Additionally, facility revolving quarter credit was to as announced of credit reduced senior XXX a term our million early cash XXX was which the

to Our ratio. our reduce sheet, to improve debt total goal balance net our continue our and strengthen debt-to-EBITDA is net

of progress substantial in all made have year. these the areas past We over

that dramatically in back rates conversion the have our continue profitability we XX, in years. seen the point the pass expect I completed XXXX Corning to call back to Slide coming XXXX call cash our projects. in Corning EPA guidance. nearly I'll I improved as on the we turn With that, stepped out dramatic and discuss conversion discretionary to up I the flow Before have to increase would our our

Corning Painter

the the in Q&A topic last Thanks, investors has over of Jeff. with destocking up year. The come

data in to hard it's certainty So is bit I'd add as elusive. this more with are well like removed comprehensive color, about the we from general, and end to a speak customer

By had that chemical on packaging recently to the be into personal XXXX. chance of and a who destocking made are industry. care third-party will consumer, retail estimate comments amount companies we to In a half Naturally, of being the have at believe agile they second the has of market there's analysis, resilient. close changes our of review However, to earnings of a we to the a both by fair impact looking analysis And said premium headwind on assumptions earlier, the uncertainties, Jeff uncertainty and which as we will growth. quickly. and this in face year and be of this puts I continue responding kind be market proven business to believe another a of the destocking

are QX made is X% guidance million. narrowing the black $XXX also the rubber our believe million a XXXX wear in to the and wear adjusted in business strong hot. in increasingly and guidance with are year. be demand our our Again, EBITDA demand to stronger continue at to essentially to immune majority we $XXX maintaining batteries committed. out, midpoint is cars as and EMEA midpoint slightly we We tires the this not of literal over by confident do going powered into Americas a and up cycle, destocking beautiful our the implies black We're This position while business, is range

EPS year-over-year XXXX. would range in to first, are a per $X.XX X% In growth midpoint. of lower track earnings year consecutive record at demand is than up guidance on our we share and adjusted third year say, despite closing, the $X is Our I for

based with Capatconversions, growth. we activities debottleneck idea Ascendon positioning our for facilities, Second, expanded applications further plant specialty of and of our the the Texas, customer up business Porte, the construction are in facility, La ramping new

final the systems operating the carbon markets future. plant to emission rubber the Third, industries continued we expect and air in and evolve continue are fundamentals to favorably, tire we our speak. of in black key as the Fourth, this foreseeable our U.S. and

we capital to this shareholders, performance improve by results and our the We the stack expect to continue I continue come can for been the our our this Thank complete nearly questions. into Operator, use to test employees it to I behind spending more beyond. past journey we expect Orion for up us, please be on our to year, open the increase over future third-party and communities into our and quarter with directly We've few returns improve shareholders, years fruition the seeing this are and flow we for value. XXXX to and the see cash encouraged I serve. you. line shareholder

Operator

you. [Operator Instructions]. Thank

from comes with question Sceptor UBS. first Our Josh

Joshua Spector

I guess, to first, I contract on pricing. wanted ask

I at year. you're release the size I time, see night, what you think almost be progress were positive and were said you in could could done last pretty year wanted to thought the impact last on next if to this the do able now. for you you the same

Corning Painter

last what's point and of forward, typically I release still going expect this of to don't We that And at all Josh, year kind We us that really typically element point, some and a was information at was kind thought up important unique Yes, it at a to we going that it was that and significant, is had an it have commercially in racked event do disclosure appropriate very we sensitive. don't. this time. of and and time. there

Joshua Spector

I sticking the it the right. lower at itself, I'll something I benefit rubber higher, contracts, mix what the pivot past quarters on quarter in being the All despite When the enough. was was else volumes was to then. guess driver looked couple that? XQ of in Fair than Okay. of price

Corning Painter

without And the the issues in Well, so impact mix some was example. have been associated with in quarter for would and that, start-up. part the start-up XXX, of China above in that of terms that

Joshua Spector

Understood. Okay.

talked impact the to in in that Specialty, startups. kind quarter? Can you just segments of the about So And you you thought in saw on and price that's flowed size mix. segments, last the those actually Rubber the each terms EBITDA of the within X the of through into talk is one you

Jeffrey Glajch

describe way maybe close on XX% a in describe saw probably it, GP better the per $XX can if about a We to Sure. basis, I probably to it ton specialty. in it's about and rubber

Joshua Spector

And impact that base? Same fourth into quarter. lasts or

Jeffrey Glajch

will as the There dramatic. fourth in be impact quarter. be It shouldn't an

Operator

Kapsch Chris line the from comes question next Loop Our Capital Markets. of with

Christopher Kapsch

around the provided metrics and the imperative in of negotiations. the second quarter, some specific commercial ongoing contract conversations. quarter But understand some you around the the the the last of more conversation and color nature I call, sensitivity

color could So any wondering more I'm progress. if the about just you have

XX% X were of complete I think said as months you of had ago. volume commitments your

So for try investors assess prospects any for helpful I be to to additional insights, 'XX. would the think,

Corning Painter

Sure.

I So I a points couple of made track. things. Number the last mean, one, remain quarter on

in new continues restructuring list So at mean the going projects, actually to can KT. terms report, to happen, look of right? new manufacturing, You they're you investment, a Notch higher of have what

can around all You that North for can you see world. you can it for the America, see it see Europe,

two, is like finishing much to just of restructuring of these our Number place. upgrades, verge We that in all same. the market, do very that air competitors So emissions are the right? on had the

look, for we're things thing. weak three, yes, entitled of We're for So like right we're investment kind 'XX, XXXX. 'XX, return that for cases, on XXXX. that. negotiating negotiating Number are on a a now. little some In 'XX, for negotiating not We're

And So another dislocation which part you then in Black. Europe, ban it's of forward with look, Russian item. this a is huge have on the

companies of tire years, big That back is a got some from change. Russia. probably couple carbon about they've half a going blocked For their really

drivers. are those all positive So

and there and We the we are so could broader forth. further about but market have are there's impacts on sensitivities along competitive

I To be just was year not I America. repeat would North said, not just what I everything last that Last of I exactly in So bit can because despite in rather think reset do a we get of complicated a clear, say year. last have expect that year, a regard.

a Europe supply demand that think obviously is and dynamic. I different

and said we maybe see can it's all this more announce be an where area achieved We'll results. all our that's when So year.

as reticence indication. some my take don't like So

long-term the It's are difficult negotiations return Not where titles and undergoing, are all I quite a that's on or are just this year. the game it's when where still there, fundamentals there. think and capital. we

Christopher Kapsch

much eyes, history just as crossing And diving kind serves. my is of still time Right. historically, negotiating normal this be more a to to

Corning Painter

For Yes. sure.

Christopher Kapsch

of Yes. specialty And is segment, I assume drag, persist into there's then on maybe trajectory right was framing the I cogen quarter, some know just for just going different word, segment what so year the you in which and the the the maybe that profitability of also are But into your exit expectations in also is year. if general and next kind fourth could view early the currents don't trajectory variances as the some I'm third year? both we mix, other your cross if of, and question discuss mix here quarter terms in end markets. the of next going there's wondering this but to

Corning Painter

Sure.

So first, power. let's talk about

a clearly in than Europe. a more is been dynamic power So it's time in market long

power really I think that We that will price continue. define what don't is.

create and So to point. grade, for think important overall We our share an according that being in at an of important of as an feel the mix this, important is cutoff value the as we'll Russia equation We lower think this. trade do, in on grades But part rubber grades well noise from significant I held I just us. premium have that. strong think price us. we're between going specialty the end we're for have we appropriate to Because for the we volume the where is super off and between But strongly always be that's don't we customers, operational we perspective, it. price in going in the to

of see predict depending share not lot premium year. to a sometimes let's that's to say, performed, And even that's do hard volume going in, next products, how mix. we So for just but less premium upon the

year. broader degree, to the an agile. into as operating that's And all being this I about economy company, think for right, going manufacturing next reflect can some

that the which behind Capitan I think work. have let's say, start-up, sort this about respectable of forward the in number. we if as XXX, a that quarter, new talked ton we average start-up but is be I of without and Jeff continue move bulk pretty those of, will all effects, some about fourth think things like been you the GP per But would us. above think Things qualifications, have impact to quarter, that We then which product that

Operator

line with Our next Jon Tanwanteng from of Securities. question comes the CJS

Jonathan Tanwanteng

you lower destocking then you And your My to kind little end the first more I'm as bit, a generally demand? to it markets? talked else release is, a one a in Or something quoted versus and and demand. specific in reference but overall reference that was mentioned press end wondering, about was that of

Corning Painter

Right.

looked is trend. I Let's truth downward shared care. at separate one reviewed areas on at personal was ones this they rubber were specialty. report we that that and on were looking trend, that it. certain a upward an certain packaging, When The

goods. shortage this out end and good services that of was were when is, kind shifted salt from came phase little experiences especially built people think of say more of inventory, COVID, towards that a consumer demand bit there of I or shifted away for manufacturing bit we're of a there though, the that a now bit. demand has a would a away we and little more great shortages that, They lot everything, as less right, consumer and in has working through

expect. a at we So much at which general environment, the the versus gasoline going grow. bit end them. little around reflecting be to of reality When clear a certain consumption, shows though, of a just to put off passenger largely in those bit metrics that's It bit to it's miles but car, to Truck about continue rubber a slide. think right? a a you're little manufacturing, we demand, commerce, also of is that hires, is bit. how to So right, looking hard why degree mixed have kind And driven, all to easier, That's in just of traffic, speak look both you I I customer see think is a certainty demand. which destocking is with mix

have And sort that. of so in we mix factors

quarter. truck or and you up you now, think those their or consumers When this you purchases. cars, until a by I light some have deferring that, of passenger see personal seen bit were certainly, Beyond at up purchases look do the

think it more X of than there. maybe have need a the end help, we're trend Does I that. really quarter shows to But like that Jon? So we hitting

Jonathan Tanwanteng

be? have then clarity QX don't It does. be would your an is anything going you of UAW what And to or not, helpful. I it's if be estimate do going to any second, but know impact in material

Corning Painter

provided, say No, is expectation Yes. I that you just years. in it a the QX which compare we to strong would fairly and our that guidance prior

Jonathan Tanwanteng

Okay. interest versus Fair have question, changed. then the enough. of like EBITDA And midpoint rate last guidance? or driving EPS lower doesn't just the expectations unchanged your guidance what's tax It the look

So I'm just wondering what's going on there.

Jeffrey Glajch

Sure, Jon. There's not that much. light little side. It on might be the a

Jonathan Tanwanteng

I'm sorry, what was that?

Jeffrey Glajch

Sorry, EPS. there's on of might nothing little It be different. really light a the dramatically side

Sometimes, some that be decided little tax we I a was come cautious have QX at things there. so concerned in that about, to

tax the cumulative key Our for are course, of things, year. for

Corning Painter

Jon, still Did another have you there? question? are you

Jonathan Tanwanteng

I'm mute. I think I sorry, was on

Operator

question Alexander Jefferies. with from Our Laurence comes next

Kevin Estok

Kevin impacting get how is rates about thoughts recession just wondering This possible maybe how thinking around further for loans? was a XXXX, year? for maybe next I Laurence. thinking to on and slowdown, rising about Estok you curious puts your are on guess auto were I takes I thoughts guess, Just a the

Corning Painter

right, we results. report year Well, fourth do guidance our so later, can our and we'll quarter after

can And come it, then. It's so we're certainly between more pretty to how I consumable. that product there the go now a up but passenger a see economy ultimately if that cars, to a economy dynamic back time develops or wears the gives out rubber, in. and you you Yes, can be the wherever traffic it's us level, that goes a fundamental like if truck go. think on to out. bit world But it's and down little It's especially go a going

I whatever think in. in that's environment a strength for we're us

think market products have a are can where like that into something all that that growth, place going I I regardless. think we new Capitan high project that's

a specialty place things, think to rubber in to like going all. that in we're overall we'll we're scheme the in where and have China, market there, I in be our our success small able of

If that's like it we'll So of going customer focused I know sorting. position read in that about into strong, got we'll full advantage slow, strengths than just on speak you taking be very And think this. else it. a qualifications, about. is it's macroeconomics we've be very certain anybody to I real better I'm If don't

Kevin Estok

I I to last And that questions But asked usual. Fair. of in true? think quarter, expect I you other is be still Okay. that QX mentioned guess, longer I have guess already. you customer guess my been wondering, most than slowdown

Corning Painter

signaled find trying question, I Certainly, Others guess made shut I fourth year. that's markets, the some in between really may what somewhat another we'll bit their have is the little would guidance customer But Kevin. specialty distinct somewhat other people a of appreciate our I difference we to a this inventory And quarter. game one for they have But experiencing that customer-specific. rubber. in down comment down. right? and their take before say is for Excellent the that. yes, for end And about not, really So the the even I spiky draw longer is we in plan now. versus right that's do think see some

Operator

line comes of question the from JPMorgan. next Our with Jeff Zekauskas

Jeffrey Zekauskas

but from would of how excluding Black have Huabei What volume much the decrease? addition? been your X it businesses. in decreased, both exclude you and If And Huabei exclusive capacity numbers I the know did businesses, volume Specialty Rubber

Corning Painter

So what your question exactly Huabei, is our ex was volume.

a aimed Sort in markets one the volume given China. rather but that specialty bit rubber, negative, I one in to is a been for And impact particular, little startup. go at not of that in little quarter. let say, a commercial sensitivity me to have both to just little reluctant in volume the few quite further we're detail for site that larger is so there's exactly other, they there would go The than

Jeffrey Zekauskas

Okay.

What the way. was it try different let's a Huabei? So utilization in your rate

Corning Painter

Excellent.

So our utilization around was XX%.

mixture demand EPA as customer we end as that a maintenance mixture That's of levels. a the to work, upgrades that's of in those quarter. had responding just well So

Jeffrey Zekauskas

be, And know, don't fourth we in XX% I utilization Huabei? should quarter, in the

Corning Painter

Well, work have through that downtime as some this the you so some take or make to we'll adjustment adjustment. go we start-up and

Huabei. will impact that So

quite be less the it than in I yes. loading otherwise but quarter, would high, think be fourth will XX% there

Jeffrey Zekauskas

what the businesses demand are Right. compare just both us And or do you Europe. X like about other? United demand, to in you demand feel conditions And U.S. a for then lastly, European stronger give the than your are feel States it? had they to the Is you and How weaker same? one in can the if the

Corning Painter

Right.

any me demand and don't think is even in X go in let really right now. those So I China. full broader markets robust of

of little imports. because And So I'd I'd I'd X. you end a a more what's in environment, is little have the so-so that it's say it about segment in and tire seeing little terms Europe you're into really do soft how a end a around getting of bit, bit talking is, within pretty specialty America, say rubbers kind say start perhaps North by stronger scale bit quarter-to-quarter. shift can to you depends both. segment, in

Jeffrey Zekauskas

in which is So specialty, in weaker Europe? United the States or

Corning Painter

weaker say, weaker between they're I is quite one X, is say tire, in specialty North a than weaker? which So think a I little would weak, on again, both is Europe America bit probably bit America. than on in I rubber Europe little the would is it North

Jeffrey Zekauskas

months? million the Can million And your given $XXX to you spending through to lastly, first your CapEx million. even $XXX X is $XXX get

Corning Painter

good Jeff, question. Yes,

is backed off a So regarding we in it's Porte. considerably it just A bit timing back-end La the lot timing. of loaded, to and

number quarter, and So a I that of this there. left purchases will think cost that see we'll large

going next into the of is over shift to right, underspend And some year.

Operator

Mowery GrizzlyRock with the from Capital. of comes question line next Kyle Our

Kyle Mowery

sure can your PRINTEX right? relative And because potential frame the for the then to this but related to Two wanted in Kappa make growth? EBITDA rather the contribution addition, to relate announcement? On it's Kappa, incremental questions Texas a Just out recent does this you a secondly, not shift, how business. EBITDA is PRINTEX conductive me report, within

Corning Painter

Yes.

let's expect, million in time It's the $XX make period X- what to segment would this X-year us. aimed Porte. to say, we contribute, the than we're So $X let's at different going marketplace. in different It's in product EBITDA a say, that million, La to a of

So it's really complementary.

have wide companies Now a range lot of materials. battery a of

help folks, us a see we to these more a So it it to does make separate but marketplace. relevant as bit really

Operator

Tanwanteng of the from Jon comes question Securities. next CJS Our line with

Jonathan Tanwanteng

the us amount of your two, And kind growth, you was That next CapEx would out what very What that's preview a what's overall is CapEx. plan the give into be can maintenance? on year? #X. pushing up follow XX a what's for of And helpful. Just number just

Corning Painter

at about $XX into to range, really say, million for have would next of our this let's vast look year. million similar $XX we're I around growth year. expect capital like year for to would If majority we point expect we'll think be this the And I in capital for a $XX million. expecting Sure. next maintenance push year, to next

that say, let's you, range, get say. on of Does year Jon? there right to adjustments the all $XXX would, the over that I'd your may the we in other. depending X from so get much million have Plus, make And to pushes how question,

Jonathan Tanwanteng

is Yes. EPA something wasn't piece that it spending, And out else? the or pushed

Corning Painter

about No, you that when La it's mainly to going Porte. big place pieces go equipment for of orders to are

Jonathan Tanwanteng

basis ton something a in then don't on second, I gave above you gross And specialty? you so. if similar Did QX. $XXX back profit per I give think Understood. on getting recall on said metric well you a Rubber

Corning Painter

is the and dynamic much didn't. market us power more for mix whole No, Because we like a play. there

So I that up. think we'll have where see ends to

Jonathan Tanwanteng

Do Okay. you a expectation? have directional

Corning Painter

Yes, from it's are think where now. we probably I right improving

Operator

from of Capital the question comes next Our Chris Loop Markets. with Kapsch line

Christopher Kapsch

Yes.

X talked almost. But changes obviously, the capacity kind linearly just about on there's for XXXX bigger your million curious was bridge economy my on kind cycles get there, to different track kind or end Maybe there and So between of mid-cycle whether business pricing there never is then markets recoveries in world or of pieces can waterfall sort being and just of would levers day an picture forth, so kind to specialties. in in or a of threshold. a I'm $XXX presentation, now seemingly about get need expectation and I'm follow-up it's one what Slide that you EBITDA. of of and wondering, talk the theoretical of just to you the every you in

Corning Painter

All Chris. right. Thanks, Great. Yes.

add of a couple different let's So things.

Europe, XXXX in that to continues for don't rubber So which grow to America, we a number we the that achieved any continue South to pricing, clear. North tighten in start to We see right? can we that. I baseline, in see well. carbon market black from We actually be the the on want confusion in as be that's pricing around America

tire to if just that to emissions. environment. to being raise expanded, capacity the in air we going can pricing clearly put in the only fair. So prices need we're all see just power you have that into And on return get capital It's we've

in think your to can month-to-month. in a can specialty, to Hard it, mix in what pricing favorable I posted. you quarter, And going current know numbers the and on with especially part we've way. here. any I exactly So economy. build continue we I say, toxity think continue we is today's one drive think like something from the to can the clearly our In it the trend see mix with you is But to quarter, is be

a for are. in mid-cycle right? in mid-cycle the right this no the for capacity, we is economy XXXX ourselves target I economy way we is mid-cycle don't our earnings where So now. materials, a think Next, see industry, Certainly, chemicals

So recovery to yes, fully Porte we not going various very we flow principally volume. some of Porte continue I in for in nicely with the have, project. do And expect then we that expect to load volume is the XXXX. investments La growth us. La in That

time for that right? us. markets. frame, these be States in But get giga-fabs looking United I the that's right, in number the from qualified X EBITDA of think capacity or So XXXX, I full a really that I at said, expect to right do think into not to going the always We've going having capacity in take positive have to those products year that. the a to it's

low I really So that as see pretty risk.

levers that one X La get you big think we there, the had Porte. to well, If was about

that So on continues. It's project track.

well very that. do will with We

mix. Another pricing and one was

achieved already we So everything in pricing.

Although one is product Huabei. Look, say. up it's shipping. running, Huabei just the environment I then and upon that like competitive things it's in. positive And in dynamics a fundamental we're awkward was think terms is other depending much of how I

things are those think I all going to deliver us. for

we're on here. ready a see. be really for going in much So very have think economy And I we're I I XXXX? to that. Are it. to track know. good going to for But what's have don't We'll we think that's mid-cycle

Jeffrey Glajch

a just clearly, is is time. response, and in volume. out lay at And what economy Corning his to there Chris, at said function on the where the think, lever is the volume I where the of the early big market demand

Corning Painter

I the don't we're business. way Yes, other a specialty say to is volume I no not going out really to isn't would think that chase specialty that's run like in there. thing

that. So think the I business, we've our have don't lost premiums entitled that share at on cautious very the in specialty to We're well. time. we're same we performs stuff

Operator

like questions for no at I'd the time. closing Corning are further floor back to Painter this There to over turn comments.

Corning Painter

right. All

for our support your soon forward and to be So We questions thank month to and you this all road Thank to the your time. you appreciate going to in and you today. for really December we're investors penetrating some analysts insightful the look of as later investors. seeing your on continued talking interest, and your

Operator

teleconference. today's concludes This

for at lines Thank you your disconnect time. your this participation. may You

Orion Engineered Carbons (OEC) 3 Nov 232023 Q3 Earnings call transcript