Earnings call transcript Q4 2022

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Operator

Good morning, and welcome to the AdvanSix Fourth Quarter 2022 Earnings Conference Call. All participants will be in listen-only mode [Operator Instructions]. Please note this event is being recorded.

I would now like to turn the conference over to Adam Kressel, VP Investor Relations and Treasurer. Please go ahead.

Adam Kressel

Andrew. you, Thank welcome call. and fourth XXXX quarter Good to conference earnings morning AdvanSix's With CEO, President Senior are me today here and and Michael Vice CFO, Erin Preston. President and Kane, available webcast, non-GAAP including This website call reconciliations, and are investors.advansix.com. at on any our

this the consider press and you that of today. statements in that best and actual Those see forward-looking the it and of earnings our differ we We elements results you contain are Note that presentation forward-looking presentation. change on based materially of our projected, we refer that could can elements light. those statements world from view ask included release business them to the in our as and

performance Form SEC report in our annual In the as filings XX-K including our and we addition, the our principle filings, on identify updated SEC. risks with in further subsequent affect uncertainties that

review we’ll markets. and morning quarter XXXX the for year product This and full key outlook financial and our our lines our fourth share results for end

Finally, we’ll your end. the at questions leave time for

So the Erin call CEO, AdvanSix's and President Kane. turn that, I'll over to at

Erin Kane

and good and in for joining everyone. your continued Thanks, Adam, interest Thank for AdvanSix. morning you us

year. performance commercial annual track saw release, XXXX, you press cash performance with AdvanSix, in of execution. the record strong flow consecutive delivered earnings for As reflecting This third our builds and our record in sales on growth earnings

financials in a me share moment. few highlights of before a let our the And covers Mike details

Amines generation enhanced soft supporting dividend, be benefit demand, repurchases accretive shareholders an an to business the In reducing and through to while further acquisition helped out U.S. our destocking share performance to end continue diversified increase our strong of close an capital quarter, deployment. disciplines model. XXXX, of return Cash value robust operational cash in with advantage challenges. customer debt. deployment offset the We our fourth of cost capital we year market pockets flow and to portfolio, the and continued efficient, to integrated, from and In increased and commercial

an the into million had approved strategy. corporate pleased has Directors recently. reinforcing us be We've for from on X% second additional among of we we've to repurchase awarded built focus Board that top strong platinum recognitions exciting companies our corporate responsibility announce continue This authorization, am was governance rating sustainability. share $XX the I and continues several Our to recognized assessed. its our capital also allocation AdvanSix for rank to EcoVadis. of consecutive social all flexibility recently

the AdvanSix Directors forward. our New for a driving In addition, Public as the deliver to recognized Company long-term our and while stakeholders has Jersey enables Board with Association of transparency results Corporate Chapter better National accountability of year. us strategies Leading

to differentiated diverse supported of model. our XXXX, portfolio, and strong we a another industry agricultural fertilizer well-positioned looking continued believe by we business And performance, year of are and that for fundamentals, product the resilience

sulfate business, Roughly of this our through organic Ag the as our high packaged the one-third expand value CIS, U.S. agricultural market in to further and our Amines well attractive ammonium ammonium and sector, has our sulfate. even of portfolio chemicals in extended acquisitions position as is granular investments including

intermediate While various expect several our to and macroeconomic we environment, confident in of market execute our we the product weakness ability and segments an and demonstrated anticipate cycles. do demand nylon through challenges within remain chemical uncertain in lines, perform

commercial advantage of running our complement in improved rates business support this We production competitive higher strong will disproportionately performance. and XXXX our power earnings have the structurally to us planned

serve also maximize and will sheet continue ability our to balance us healthy well value. shareholder to and deploy support Our capital

details Mike difficulty]. to over that, discuss With financial to [technical I'll turn the it

Michael Preston

four, I'm of financial the summary full year morning. good Erin, Thanks, on results. I'll XXXX a and where Slide now provide

execution commercial performance billion, performance. adjusted across terrific -- $X.X record $X.XX, million, million bottom-line material strong flow pointed volume of of and share inflation Sales was resulting and earnings annual of EBITDA all declines Erin out, $XXX represented and significant offset As $XXX growth. in board, free cash commercial top more of it than the raw adjusted as per

and increased represents now earnings We've differentiated our three for peers. consecutive versus believe years this performance

pass decline. an a turn and Sales Pockets was material up to the recap market-based demand, sulfate Slide of driven and higher XX% of decrease the decline partially pricing market pricing, quarter, by in approximately end primarily propylene. Soft, Let's driven X% in by fourth to This customer increase $XXX X% by contributed Pricing fourth cost the five in destocking decreased ammonium volume. by following net favorable offset X%, XX%, to pricing. million benzene through results. quarter comprised of raw in primarily volume was decline in

of EBITDA on versus the next variances acquisition the $XX approximately U.S. well. X% year. The a highlight earnings to sales Amines XX% the prior share per $X.XX was as up added was will I million. key year-over-year Adjusted Adjusted slide.

income. million, flow up versus up expenditures Cash prior the year. versus in flow increased prior million $XX increased operations million due $XX $X primarily free higher quarter finally, reached XXX% $XX to And cash net Capital million from the million of year. $XX the

Let's turn to Slide six.

Pricing margin gas natural the Here nutrient drivers sulfur positive a a $XX our Reflecting fourth Tracking a drivers, value performance benefit. proposition. basis, of Ag year-over-year. underlying drive over a variable key well ammonium over key on strong net our few and remained raw our we materials ability our quarter as price highlight adjusted million environment of to the year-over-year. sulfur EBITDA sulfate as was

was over was approximately nylon reflecting following over Chemical year-over-year. Performance was costs. our intermediates portfolio some portfolio. customer due chemical in primarily intermediates our to serving lines, and quarter, across key the nylon as most durables and volume particularly The our roughly the impact consumer spread million saw $XX across markets. soft acetone and demand product and across market well, raws flat caprolactam raw unfavorable building destocking price over propylene We end end of largely positive margin our products construction year-over-year and

was the fourth turnarounds had quarter plan planned we our approximately fourth year-over-year our known in to million quarter versus as tailwind turnaround ‘XX performance of of a XXXX. of $XX no in the activities impact The

you may planned quarter multi-site As the of turnaround and we XXXX. completed third in our XXXX recall,

Finally, in million an driven higher and we saw material gas spend inflation, primarily in non-raw increase cost and utility transportation plant prices an by in approximately $XX increase on costs.

Operational performance cold December impacted temperatures was by our chain. particular value extremely in in integrated across

a of and a fourth As flat result, quarter. rates XXXX roughly non-outage the quarterly our historical to utilization was below for run quarter

the to turn next Let's slide.

we've cash capital, million including flow of $XX quarter. ammonium and $XX of left of XXXX On Page of driven $XXX net favorable the impact pre-buy the approximately sulfate advances networking in by million our side income highlighted seven, primarily which was cash robust generation, fourth million

and cash the approximately million flow yield is and is the health, which earnings free roughly was planned CapEx business our for flow would the delivers. safety $XX XXX%, of driven and our I that increase projects. environmental and last XX free model over in quality XX% by maintenance flow highlight reflects generation a months, cash year, cash our conversion healthy

the the right allocation of we've since side On page XXXX. depicted capital our

debt combined we've step returned of at to the to all As enhanced return acquisition of shareholders in $XX million capital meaningful up with by we in share further deployment a XXXX our shareholders, levels. cash U.S. reducing a while Amines repurchases. way you can XXXX, dividends In see, and

Xrd. XXth share record payable on March for $X.XXX shareholders of dividend be quarterly next made as of date will March per Our

favorable We balance uncertain our are as macro healthy in a enter environment we XXXX. position a particularly with sheet, in more

a We've strong turn our business let's in along to power testament remain generated for our sustainable outperformed long-term Now is We investments from investing returns in operational to returns. and capital execution. eight. have invested the with Slide disciplined our and earnings approach commercial created which the to peers, on

with goal higher through of highs. focus generating the across business to cycle the and higher We profitability continue on improving lows

other a We include which critical in projects increase consistent maintenance and an of in for long-term are savings sustainable, cost expect XXXX, expenditures as vital capital well. and projects growth include -- performance. and mix will These safe, infrastructure, which

our includes conversion. and pipeline earnings the ammonium project growth goal our to business granular sulfate projects amongst to double support of expand U.S. multi-year Amines Our others,

turn that, let back the call with Erin. to me So

Erin Kane

Mike. Thanks, fourth sequentially and price quarter. the to remained nylon. relatively spread global of Slide lines. raw Starting discuss key with nine I'm year-over-year in each flat product on now The our composite

declined use consuming COVID excess to however, demand to U.S. spending supply not for end impacted declines Asia end in on China impacted weaker moving sales demand Europe Well, largest industry significant respect uncertainty regions a face markets, and use in consumer severely spreads, good. supply and led lockdowns has greater prices. with the by nylon Textiles Asia represents global increased more and which lower textiles as globally nylon other to conditions. demand and at advancing are directly,

half slowdown fiber the North in into an the first pricing. we from the customers, in while fourth end through from Now with carpet year. continue the volume price are where quite quarter seen inventory In In we've filament improvement sequential continued our we the America, to out impacting the global is which of corrections, compression perspective engineered Asia expect XXXX, we situation a chain the mixed. space is market of expecting serve and plastics,

applications remains Now, as auto, other to raw a multiple reminder, pricing despite end input some drawdowns material at seeing cost. are consumer such portfolio stable continues industrial a And year be a nylon and lower end this application our as the And inventory goods. and than resin space we business. a our serves here resilient end for moving of spot, into as of roughly at packaging then change XX% bright market, a

a to through meet optimize supplier continue the being in to focus as mix We we'll and and reliable have customer we American past these on dynamics. demand North our navigate

come lower ammonium particularly higher earlier supply a costs, prices significantly have in as nitrogen seen sulfate. availability supported We've Europe, well reduction Nitrogen XXXX. in to pricing. nutrient as witnessed from Moving in levels energy down

supported the expected crop is to agricultural law support underlying the continue confident not remain year, use nutrient it to will resilient seasonal a farmer demand. demand profitability, industry planted affordability, to we acres strong fertilizer ratios fundamentals exiting While uncommon prices, by and stock that and see

behavior of our key heart remain into customers to despite move the cautious as some so buying positioned season. And the season, we ahead domestic of the serve we planting well

in And quarter. grade few over costs year-over-year and have to months. chemical Industry lower acetone supply intermediates. on refinery realized lastly, Propylene last to turning the the prices cost propylene sequentially fourth over trend ample continued improved

the phenol buyer as supply reduced into softness on some building operating seen to acetone stable large has and U.S. downstream industrial and applications, rates demand other by into balanced the see we tight, demand imports and into acetone supported globally applications. construction While lower

point operating industry well here dynamics that like in out model us these. serves our I'll integrated

to Now our XX let's outlook. Slide discuss to turn

resilience again We business of to an to ability in our environment. navigate through the expect our challenges once performance and demonstrate XXXX of the model uncertain

industry We expect agricultural fundamentals underlying continue. favorable to

American North the particularly for also supply the conditions We potential given some XXXX. industry for expect balanced lower half globally. We'll of phenol first rates the have acetone also demand and operating tightness, in

across We building do and implications construction other consumer lines. product anticipate I shared and in intermediates markets headwinds have earlier, and volume chemical will our nylon And this both end price. as for durables

hand exposure reference, market we've end our on by shared the for Now the of sales page. left side

diversified lines, results as demonstrated the our from market a helps of company are range environments. any significant and variability by the our end several chemistry product We insulate in in company exposure one

drives returns we on less and sustainable in stable, utilization higher driving experience business. turn variability improved performance, our continue customer the our rates, Operationally, and focus while safe, which for in

than our value to average. the rates target competitive us enables running disproportionately and chain integrated cost higher on industry plants advantage at those Our

XXXX, approximately and range reflects as year as to to spend growth are million. improvements, cost savings critical full support This $XXX the infrastructure well spend additional projecting For projects. maintenance, million higher be we to $XXX other CapEx

planned compared full turnarounds of to range the in be a We XXXX. impact to million expect approximately million plant the year for million $XX tailwind of $XX to XXXX, $XX pre-tax in the

to rate defined nearly year following $X a funded tax XXXX, million be benefit we cash and anticipate million, approximately status. to bringing XX% approximately be lastly, contributions effective our zero in our plan to $XX pension And expect to for fully in the contributions

slide a before up to turn to Let's moving wrap XX Q&A.

investment long believe AdvanSix we term. offers previously, and shared medium, we've thesis a over As the compelling short, that

North lean asset business model, base provide position Our American efficient leading and coupled with inherent advantaged competitive our advantages. and

applications. And we're market aligned to end those diverse set of

reiterate and roughly third portfolio our is fundamentals. supported of exposure to out agricultural pointed Let one strong again, by

electronics, growth into broader invest to and long-term applications continue the also coatings, such solvents. across paints We portfolio as and other for

to mix discipline sustain sales to exposure product these and and applications. growth base assets to also our our diverse through our that profitability. seek on use continue are and smart are twice and investments in We Supplementing roughly margins enhance our portfolio, differentiated our average improve make margins, to which and business throughput

increased through cycle earnings business our We have on the focus profitability. substantially of this power with

allocation value framework enhanced creation. our further optionality and for capital upside provides Lastly,

feel So, to support strategies the very all, advance's sustainable continue long-term which performance. we expectations and we've about good implemented, for

Adam, So, let's that, with move to Q&A.

Adam Kressel

open please the questions. Andrew, Erin. for Thanks line

Operator

Instructions] Neivert with [Operator first comes from Pease question go Piper The ahead. Charles Sandler.

Charles Neivert

Good morning have everyone. I question. a quick

et done, has just any maybe of do the is Or capacity of the or of the efficiencies get to to comes? look I a increased at spread in And maintenance are that of that tweak might fairly one work be the that to of going Is of that two does or to bring to done terms year? the existing In there sort small terms equipment, CapEx, going quarters how in be then that there others? of course it anything Is long-term improve heavier lead cetera. across that out? than getting that more nature evenly

Michael Preston

rates CapEx run the half the Charlie, the are Yes, half. second first heavier in typically spend than

we demonstrated levels other of our and know, roughly critical and forward XXX here. up $XX XXXX projects, As you increase to safe our is, and effect we've in and again, sort sites, stable operation improves, maintenance the an repair spend the here know, safe going from, the has ramp And, in infrastructure work the support at operations you some of stable which, in million XXXX. to XXX

So that's expect. what I would

in sort XX% So to half of probably, half. first versus second in half, second XX% XX% the range the

Charles Neivert

of level China terms of cadence exporting seeing, guys keep because and see has all any Got that, running. things where it production at say going it. over have is that let's or, they higher have typically of maintaining let's it at And forward, is you are they're they assuming movement the do or that they come that normal I'm more you and level, product the exported then meaning idea excess the some mean, say preexisting? haven't looking want months? the last, the to, Or are, of might in to do product has state changed you that, back when I couple

Erin Kane

resin seen certainly. European their just with a in QX So, Union. resin, the we're flows, the impacting right? demand here region you, Chinese out and through Europe probably not and countries, it's in XXXX, other as rates trade it's last America -- also and We've of confluence late start being months, seeing, started couple on factors this Obviously, into pullback No, the well. exported as the coming certainly the over but that of pointed trend moving now into into also from in operating those of South considerations the starting Mexico year, again certainly and the higher certainly the QX lower cost

compounded have against is pressure Asia the resins America do lot how, is of also of we've there and Certainly, they And collective consideration, this the overseas downstream seen, of including compete assets. OEMs -- and Mexico. products footprints, moving so how set on what into global

recovery in the pull rebound, region, to certainly watching it's certainly the So, in up. back a their for obviously volumes we're

to have so of that outside low You contribute be rates operating seen XX%, hopefully China. well. as will starting They're in about

So, I freely spot-oriented will how volume Certainly, but well. first a for it products think there's be half, us, into moves and long also there's certainly it as contracted consideration negotiated here's that.

factors, space. plastic may And impacted certainly, moderated half landed in here in well, again, and as confluence costs making engineered been sort we rates just year back which have that of dramatically this well. of see the of transport, freight predominantly would've the sort as as another But of dropped freight has

Charles Neivert

it. Got

I'll have Thanks. back come Okay. more. anything if Thanks much. I very

Erin Kane

Okay.

Michael Preston

Charles. Thanks

Operator

Anderson Please Vincent The Stifel. with Instructions] comes ahead. next go [Operator question from

Vincent Anderson

Thanks, morning good everyone. and

and come of also couple U.S. of a the mentioned demand plants this spot hard point market things improved kind that's to so made year. times, past than be an you'll over harder say in year, running specifically. share You nylon the couple but you've a of despite sales, out very in like the outlook last next this involved, export years that's And

that. sheet lean And that greater you builds a also you to on have if balance inventory needed handle can

commercial observed versus So, how years? strategy in particular in prior look different wondering I'm just downturn we've what may this your

Erin Kane

of as be focus for an a we a question. sustainable have operational year statement. as continues provide sort it Thanks have is we have. certainly I'm as place strong and throughout Certainly, to color sort certainly, little the of clarify didn't we normally around us. bit strategies And for the we the happy have discussed all would that in more to relative safe to operations core around XXXX,

are of we utilization strategies ensuring outcomes The the our commentary the plant rates expect. is delivering returning again, that around

Our integrated to naturally value chain start. rates run to allows us higher

of just down quickly kind it let's break here. So,

least demand So, in right? our American higher where operating a now is at Phenol integrated of market phenol players other North XX% off, plants our on right position are rates because than phenol

So, the which again hope cap running oil well. market, acetone ammonium that and again presence allows have sulfate. serves us to In us in the

for a relative We and fertilizer. our confident have strong spring season to in demand --

again, important back our and running there. and our So fulfill nylon and that to demands to us customer for Obviously, are through moving it's for to performance get we ensure caprolactam

have in I In things It's robust a on. out, packaging plastics a cases, is volume and going consideration, consideration some engineering associated fiber pricing as and and we with Here mostly pointed resilient. filament. it's remaining two

see this you'll this for So, do have organization I is, think us mix we for and as what enterprise. yes, lever a

think us that calculus, degrees including inventory have builds in which us other differentiates those space. of to, say, the competitors to and But separates those thinking all we up right sales are I this pull all as margin operate from the freedom go our market, things and of you against the and right about which and through into

Vincent Anderson

big it if if was what that talk helpful. about is the revenues you Friday, a And correct, right? going I this were if like have your so, actually looks a in quarter. Thanks. on math but there? up sequentially very aiming’s maybe fourth Do my Perfect, can And on

Michael Preston

the you M&A. percentage When to a point at was Yeah. all fourth roughly revenue Amines. driven on by you'll third quarter And that bridge look here, U.S. note sequential total that's

is And a quarter. the timing Ag the revenues you some to that of and impact seasonality can at with serving. they're of from When quarter associated the sector, look that

year the So as to level of bit first seasonal a expect high and the half. first more improvement is of was in of the this that we strong would also be a typically the a half season,

Vincent Anderson

actually, one quick similar Excellent. vein. a And the in Okay.

Your quite price last year. obviously, prior that cash dollar advances represented much how of a you picked up versus XQ excluding just that being in higher to bit fertilizer versus volumes a amount? speak years, of higher your percentage Can

Erin Kane

certainly Sure. there. We can provide some clarity

did this desire and the is year, pre-buy to pre-buys the interest customers again, year. proceed the of the that conducted last one. our So with be consistent to the average proceed for on in a with with years we pre-buy would was it would prior a What we say volume we that as in

So, price 'XX timeframe. that difference 'XX The being higher 'XX, being the 'XX. than it really -- let's call market

Vincent Anderson

Perfect, tanks. Okay.

Operator

next comes from next Silver question, question David The the go King. with ahead. CL Please

David Silver

to just summarize, at could I I'm wasn't call the remarks, the well. just or I'd But the able operational you you yourself things, you just an both I opening you but challenges one could Thank to Good comment characterize repeat so then two quarter? as could unusual you of joined going I've -- late. if summarize what the your Hi. listen it, I'm that it appreciate source so, advance, morning. and start quantified you. -- had on going in including if Again, you just but warn all, we this to to morning, make were in

Michael Preston

more the utilization bit color. Happy particularly David. little we a Sure, was lower in some saw quarter, to more in Where relative Yes. December. rates of we what had planned to the provide later

only across in us but industry. You frigid we the would've at that may some than also others resulted us, And rates in running that recall, what we very the weather impacted hit had liked. a of temperatures that not lower string country

the the quarter up necessary the into and And quarter. here driver to we actions will get comfortable get better expect was and performance plan and so that the main to in first we're took that, as back do all we here,

David Silver

for that. Okay. ask Thank about to wanted I U.S. you Amines. question a

about been able also benefits. full it's wondering if about just you've the owned but now are to realize some -- synergies cost, talk been just three quarters. integration, So, you the for crossover And revenue was it if you've I there could talk

the And much, higher that straightforward there you then, the past comments with how really about to some some opportunities executing if CapEx anything Thank made your CapEx being in spend there. is for of dedicated year, expansion spend, on pretty next you.

Erin Kane

David. Sure,

on which coming integration sort integration It terrific, plan So, the largely is quarters we're last has and I up the is fold. of great. The expectations, would that bringing share year, the gone of relative a which as functional well. in couple our went to actually to complete, has our is into portfolio

So we're again, we to on target where to we we're be. sit, were where with expecting pleased

And important. that's so

was really growth. when business set for of of One the or landed the a future announced acquisition that in we assets this itself an was asset around that considerations

expand So use to pans possessed, capability to our to opportunity ways. projects and executing focus take expanded sets where primary oriented to assets are we against and a begin new that them they and saw multi-faceted begin pots more the which those was in

again, the assets. other assets the CapEx targets -- are our here not CapEx as as So intensive again, CapEx

So have expand deploying against again, sets. begun to us we to capability projects enable those

number customers continue that make, a production And, we we alcohol that to the are improving are of Amines there isopropyl inside have hexamine, and other customers psycho of views, So including, reach things potential out. can the and diamine.

value creation you the as sales rather the where more so relative headed And of that synergies again, about. asked than are to is traditional we acquisition to

able think those be that speak we'll progress we plan. to we expected work So items, track, to are I again, where continue to, but, continue about on be and as more we to

David Silver

XXXX, Where of differentiated or and to are revenues differentiated revenues of your I you percentage specialty specialty now that the believe is product -- think power up follow in past you've on -- million to products? clutch just you is a when do your of so is earnings run growing intermediate estimation? in what kind revenues. what think for about rate overall talked going or comprise or is And budgeted $XXX overall about, that, What that that your Okay. another the

Erin Kane

it's purity again. No, Certainly last we in seen, true that proud and out the and we are in growth high sessions. been coatings going and nylon. both our have growth that high the expanding intermediates intermediates on value years prior sales wire into and five areas over of really cable electronics, grow co-polymer paints for of Significant our to and pointed as and have we continuing

products, say, What differentiated is considerations David, immune and they're necessarily are while per dynamics. se the I global that, market not to end would these

like these continue are in to and long-term invest trends demand applications. about have for So they other these positive considerations why to we've just can think applications and very certainly continue for But it's spaces. our portfolios

move and But for in different of continued so, focus. past things than few XXXX, of down growth a semiconductors you And are goods rate instance, of thinking know, years. perhaps the be at may in purchase people there's as kind we've seen about

in Europe seen has pains, sealant. coatings, and a also slowdown

we long-term immune, not kind is to is I the a So entirely for recover us. it's have these long-term focus opportunities again, for but continue to of think again, things key and And us. this takeaway that expect those that

David Silver

them. amount the ask I is rates, related could about thinking I I else Everyone guess America, that. on question side so or construction do mortgage to have interest say, things mind. don't has negative you bad But incremental let's if going uses that slowed the what know? keep to guess you a a for and too and if continuing wanted their raise I to in nylon shot, had construction residential things in going Fed of effects, I'm and first fair But, down like particular, rates North I'm and great. Okay,

but now? economic guess, different and seems How your an thank you sense environment, downturn nylon on where think allocating, residential the stop markets in do makes what there, construction marketing uncertain end definitely you. capacity about one to but right I or be I'll to

Erin Kane

certainly areas. plays sales are those being where lodging, you hospitality think we than services commercial the that see you and coming is down so opportunities a about would is certainly we in challenge be well impacted nylon will for It and against inflation, sales. that into the latest hit say, areas generates as rates, strongly No, see to more housing a continue like certainly confidence, leisure there types but the That consumer activity that continued be home construction is and said, strong remodeling reports remodeling mix, most upgrades, and and starts residential certainly these of consumer space. commercial. interest say, still areas be hospitality certainly spending We can by as and existing

collective Again, be nylon flexibility. set to important -- have But again, some we this. for of our produce as is through, the to dynamics for us nylon navigate focusing on that going commercial space assets

one still space of sure manage around as this folks. important we way. those key becoming buying, it's in supporting we Customers sustainability have again, to we make well. are that those degrees are of are Opportunities along mix So, the to of freedom want that

our be And to important and post-industrial as interest here recycled in in grades are grades so going well. recycled other they post-consumer applications are as

the we've in So, that a can that play. the ensuring the and capturing pull that got this assets. those proven ensuring residential through. our commercial And levers even again, opportunities we come then, we may on at mix we've really are of the past a We've end base flexibility -- got smaller into impact of carpet of sort as and navigate

David Silver

so talk to thank wanted hear you. rates interest haven't know. low before, seen don't you just, recently. have nothing Probably that, you been I I so but through

I of I'm a Europe do But spiking impact just One product its, produced the year on, well and get may half. last of you're and exported to I anticipating or be going in if guess, this And expectations might into natural out. question. effectively is with for patterns. I just be to now that import or and seeing be as Europe, in gas highs well in just past could fertilizers to your year, I'm fertilizer patterns, words, what mean, global off of shift wondering come nylon to both seeing gas guess, Europe, Europe, trade And in forward? if And lower And you're wondering that natural since on guess, used natural point. this any has as backed any wondering costs either trade there gas used of I imported nylon has other caprolactam. the that

Erin Kane

has general improved as Yes. the in Europe. Certainly, situation

As sort the number improving, And they the right in input applications a sort touched you produce going end demand as through to point reduced of chains, out in we've sentiment to general. they're on. cost, of that of in a number on have still weakness have to and

So, it's rates chain. it's primarily now there's we the We'll through for utilization when production probably demand about picked in those certainly right we caprolactam the nutrients, Europe's -- regional where, see, there. said, yes, of like capacity it know think one have I up as XX%,

as from as certainly, we they'll move well. here move But as say space But It's But well. that accordingly understood, there's where again, is their trade markets heavily in on things global and Asia that hard the other. or definitive went sense. And have in nuances are one these to certainly is a a this global moving way resort they year forward. themselves last regional

got of going there's because length you for certainly certainly, nylon, is a a just to slowing buying just you've fertilizer and so pressure Europe a have down in general. be in produced market supply, global it's there So a buyer's

put so nitrogen at would And capacity again, there, we XX%. about

regionally, globally else, have progress to moving both going I what as this think through anything like is forward navigate the year. world the is we through and So to

Michael Preston

though natural history And they're basis prices to So still have they're right? you when down, relative there, another come those even think U.S., still gas prices of Dave. like high, that's consideration the on Yes. -- relative just a to and

David Silver

No regional Yes. definitely No, still question. they're that is disparity.

color. you very I Thank the much. Okay. appreciate all

Operator

would session. closing back the remarks. our concludes conference This question-and-answer any for Kane to to over Erin turn I like

Erin Kane

fourth execute the ability some your and operational Thank of reflects again and to and our this you our of macro interest the quarter, performance a headwinds Despite all resilience in navigate multitude and model business for environments. in our time challenges morning.

XXXX look forward shareholders. With record we continued the strategic to we long-term again quarter. Stay well. safe in with performance to and execution in of are committed our you speaking that to value XXXX Following priorities next look to and our forward be delivering

Operator

has conference The now concluded.

AdvanSix (ASIX) 17 Feb 232022 Q4 Earnings call transcript