ECVT - Earnings call transcript Q4 2024

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Operator

Good morning. My name is Risa, and I will be your conference operator today. Welcome to the Ecovyst Fourth Quarter 2024 Earnings Call and Webcast. Please note, today's call is being recorded and should run approximately 1 hour [Operator Instructions]. I would now like to hand the conference over to Gene Shiels, Director of Investor Relations. Please go ahead.

H. Shiels

operator. you, Thank welcome Call. and Ecovyst Quarter Fourth Good to Earnings XXXX morning, the With are Financial this Chief call me the on morning and Feehan, Executive Mike Kurt Ecovyst's Chief Officer. Officer; Ecovyst's Bitting,

measures we'll take information the non-GAAP anticipated only the the is in today's company's financial and Following our information speaks turn as and today XXXX to prepared shared our your Please GAAP cause performance, in this some our can shared information in call with note and @ecovyst.com. Any including financial are posted implementation company's information, results end-use their operating on date. release our questions. today call forward-looking Investors risks the presentation financial of These the I'll that corresponding the Bitting. about our over materials with and uncertainties discussed of remarks, measures website be trends information materially. subject section outlook. company's demand Kurt is of the could risks in and that the actual filings vary mentioned plans of strategies, the Reconciliations of This now earnings to SEC. found forward-looking to

Kurt Bitting

good and Thank you, Gene, morning.

the We XXXX. pleased fourth our are results with for of quarter

am Ecovyst's to responsible a challenges delivering While resilience the is testament and than in of delivered present manner. macroeconomic offshore extremely performance line global This a the recordable and producing single fundamentals quarter, million of expectations, continue safe industrial injury proud a colleagues products further in demonstrating for XXXX. of our I dedication in was we products with producing without businesses. Ecovyst's more in best to and X fourth the tons also history to my financial and our results Ecovyst in core

to favorable segment year increased pricing. XX% volume Ecoservices adjusted quarter, and sales up results contract deliver driven ago with solid to compared EBITDA the continued Our by nearly

driven X%, advanced advanced the silicas polyethylene. used sales in of addition, by increased production silicas of higher In for sales

lower, However, and Overall, to quarter as XXXX, anticipated, the timing to sales up for fourth for were of $XX hydrocracking we quarter delivered sales. XXXX. of the of the compared fourth the X.X% of joint principally due venture EBITDA adjusted million, Zeolyst catalyst

the progress whole, provided ratio basis objectives. XX-month September debt year-end, and operational of strong a XXXX. year a trailing For a a in down XX, as our on net generation at X.Xx for also strategic executing cash of XXXX Xx continued on leverage year was from the at

our segment operational During the benefits anticipate year, in Ecoservices XXXX. in growth, initiatives improved efficiency, provided supporting reliability for and our we from volume investments reliability in further these initiatives realizing

our Ecovyst to the for the in late year. expansion future The In expect customer business continue emerging capacity we capacity capacity increase demand capacity support and for This Kansas customer complete as expansion increases commitments polyethylene core and catalyst addition, this by support and underway industrial to expanded we at our position will to underway, City technologies. businesses with for XXXX. XXXX site as well is our ChemXX backed

plastics with processes. collaborate leaders refine growth to advanced biocatalysis to to continue with and Lastly, capture industry anticipated carbon further to associated we and enable recycling technologies serve

due a global provide We near-term X, macroeconomic of outlook. turn uncertainty I'll certain Slide cautious in ongoing demand the an to end uses environment. we on demand As update to maintain near-term our posture in

regeneration momentum by segments with utilization. alkylation so are project In that positive. we demand that unit stable However, gasoline services remains and underpinned long-term positive strong our for serve Ecoservices, continued the demand XXXX in of we high most believe we trends, outlook

as to maintenance XXXX. in activities XXXX compared more Our refining customers are planning early

X XXXX. turnarounds with turnaround customers of Ecoservices refining its first to compared just will turnarounds as the customer our of in X comparison, the of X the coincide execute activity. to first in half half XXXX quick of a X will half the As execute in in first turn,

continues the to growth, acid, centers mining by driven sulfuric data virgin energy show For of the robust and infrastructure. sector copper increased in use

virgin nylon of to sales in precursors, surplus used acid near-term which sulfuric fluctuations may uncertainty in the due year. production foresee of the the we demand and half first capacity Asia, terms global In the in ongoing affect industrial of

second half, incremental be However, strengthen demand demand believe project firm from customer sales in virgin new will and will that second demand we will we the acid supported in by half. for higher and fundamentals of for improve ChemXX mining effectiveness Overall, also precursors. nylon HSE for at versus the catalyst performed mitigation and offers demand to plants anticipated risk other projects customers catalyst the sulfiding activation its technologies. is Demand our it ex-situ the

a XXXX was albeit was hydrocracking Moving looks catalyst catalyst segment. as peak a in AM&C to XXXX. a not case year sales, XXXX be the good for hydrocracking change-outs. our stronger for to year year

distillate we addition, our technology, flexibility yields heightened improved In continue customers. in to enhanced refining see and interest which for allows AM&C

sales of catalysts be this year currently to we project result, hydrocracking a As compared to XXXX. up

heavy-duty demand. lead conditions for these hand. for into XXXX sales upon this and of long control will applications X-year emission We catalyst vehicles, is in subdued. EPA have As sales around typically based implementation customer have the year The impacted our challenging believe macroeconomic remain sales increased X expectation for diesel deferral orders Euro adversely times, near-term uncertainty for outlook

capacity continue our subdued, advanced higher this our preference Middle polyethylene forward have City demand allow design For look exposure, for and East, cost-advantaged growth. customers' the planned capacity where of to in overall to compounded for our believe sales completion growth XXXX the and U.S. outpace We benefiting XXXX. will capacity particularly will producers In utilization expansions support ramp-up and outlook We Asia. production global of global the polyethylene which custom our demand remains highest polyethylene costs, rates translate capabilities customer from the energy our to the expansion, for we by catalyst regions. Kansas that feedstocks capacity, and silicas, are these into in overall is excess which

emerging our to businesses. Turning

outlook of believe the production catalyst for supporting sales longer-term fuels We continue the positive. remains sustainable to

We increase of supporting in European the implemented the XX in has expect production months. mandate. sustainable X% renewable sales the Concerning in demand aviation diesel Union fuel, the now the next recovery to production blending XX

are major their airlines XXXX usage SAF targets. maintaining Additionally,

$X of also anticipated roughly advanced that is XXXX biocatalysis grow to approximately annual We is the silicas such emerging capture to applications Through for growth forecasted $XX market in from see utilize a carbon as carbon the to billion compounded billion utilization continue storage by enzyme rate XX% increase favorable value of and to approximately capture. sixfold and trends XXXX. XXXX, global at and

we innovators on product leaders these and to qualification. continue work with We see in customer as strong engagement areas

for higher-value detailed over production customers. quarter. in XXXX. of advanced mobilization required earlier to And fourth to a have higher for And XXXX on a Zeolyst Mike pyrolysis the and announced intensity As projects leading seen, we of for significantly on more the partnership discussion the our believe you oil biocatalysis-based early strategic hopefully I'll call recycling month, through venture, now and joint a commence Opal that enzyme the been will thermal this family production reduce and track. with late collaboration pyrolysis innovator of broadly results oil that the for turn Infinity follow accordingly, remain proven in We of Ecovyst has our anticipate in and financial quality applications. ChiralVision, the catalysts of for technologies sales enable we

Michael Feehan

morning. Kurt. you, Good Thank

for will used Kurt detailed for year a our polyethylene and Zeolyst production demand sales As compared our the year-over-year timing in financial of in contract drove of venture, regeneration increase quarter. more increased joint I expected year. mentioned, the quarter sales results. fourth with volume begin our to materials prior orders hydrocracking pricing to catalyst advanced and of fourth the with Ecovyst along of Within review Higher full the favorable services, led X% the lower

loss of value a outlook hydrocracking the the During and joint up stepped fourth million $XX sales investment the This contract in higher of polyethylene, nearly of quarter, venture, the up our to Zeolyst advanced for our quarter volume to the fair in in Zeolyst X% the merged quarter. investment Zeolyst on fuels. Adjusted used fourth in the million, sales joint production venture. catalyst we of and partially driving reduction year-over-year, venture a net our when reflecting recognized sustainable Ecoservices was charge estimated investment materials The EBITDA in applications catalyst impairment control business emission in charge of The was production $XX step-up. for of reduced silicas and an noncash in the was used demand in the PQ timing Ecoservices as part joint of impairment value carrying and primarily favorable the due higher XXXX. our pricing by combination that the portion within offset

change-outs venture. year-over-year, driven as higher demand by the partially sales sustainable cost down Silica the the Zeolyst custom in emission production catalyst control year-over-year. This X% favorable For the were sales lower for EBITDA $XXX related pricing as within for to and adjusted $XXX for by in compared adjusted fuels. of impact the volume niche venture lower of polyethylene polyethylene was for Advanced from lower materials And Zeolyst by hydrocracking decreased our timing driven catalysts pricing, were of offset in joint catalyst joint applications Ecovyst catalyst volume primarily well to year, up by and the sales the million the million lower of in lower by of Ecoservices. The catalysts supports. XXXX contract the EBITDA higher sales were as used flat lower were full was XXXX. customer driven primarily finished offset sales sales volume of was pass-through

positive, fourth Moving The for variable in contractual in the to highlight pricing largely for adjusted quarter. price services. the was driven the components by the next the regeneration ratio EBITDA quarter cost slide. to strong of I'll change the major fourth

with quarter Adjusted lower volume to the volume now higher offset lower costs in associated in up venture. of up with than Regeneration silicas, Ecoservices the X% and adjusted the over nearly to the more venture. inventory prior million joint sales cost EBITDA cost segment was year favorable absorption compared by The to up of quarter quarter, ago favorable XXX million, up costs pricing, the balance and $XX reflecting in of in volume adjusted Our fourth turnaround Zeolyst relates driven contract by The to of starting fixed the and quarter. quarter reductions higher timing was and EBITDA Services. build basis EBITDA and margin lower sales this fourth fourth joint volume for Zeolyst highlights, in XX%, quarter the pricing benefit Ecoservices I'll change turn advanced turnaround Sales were year compared $XXX the was fourth XXXX. points was the XX%, in of the Ecoservices. the sales

million modestly catalyst taken up largely Catalysts of fourth joint sales. advanced Adjusted segment venture in was Sales silicas X% sales $XX Advanced Materials fourth the the within compared the our Zeolyst favorable of niche overall Catalysts sales Advanced higher the was quarter, as higher of million, on sales segment, the production fixed to of actions $XX higher and timing the well up as sales of of were from used the for Zeolyst for as volume catalysts. cost polyethylene joint reduction venture. the offset custom silicas, advanced For absorption principally Materials and to down lower due in the and XXXX for Silicas advanced EBITDA of benefit XXXX sales year-over-year cost hydrocracking of quarter

I leading Zeolyst positive changes by catalyst and dividends higher million, our generation in million XXXX. our Kansas expenditures, The in higher and venture favorable on growth leverage, the generation specifically assuming cash, cash free ratio joint up with In was making with remained of no for offset a in our under for will to working target cash activation ended As by net our uses full expansion. We With City of expected our partially our conclude ChemXX light towards $XX XXXX. capital to we to available progress of the year availability and on anticipate positive net over was ABL discretionary polyethylene debt flow driven X.Xx. projects our outlook year catalyst Xx significant including ratio discussion XXXX facility. positive debt at $XXX move for quarter, facility $XX cash discussion the capital, million our adjusted leverage compared continued of and year-end. approximately cash the fourth generation, and a of to capital expansion in ongoing generation the cash liquidity, leverage higher of we capacity cash cash from X

about we This as is core As guidance many cautious into for remain foresee noted, the stability macroeconomic year. XXXX, Kurt the activity. cautious we we businesses although near-term outlook in move global our of factored outlook relative into our for

For pass-through to projected to to estimated in $XXX $XXX of costs XXXX, Sales million XXXX. $XX the expect sulfur to million. be the XXXX, anticipated of million higher proportionate are million be our joint the $XXX of range for XX% an related Relative pricing outlook range. sales we includes to GAAP $XXX venture this in million to the share in effect our Zeolyst higher in

driven we Zeolyst our joint share result, sales, for $XXX $XXX including We and the contract favorable expect total a to million pricing volume. by Ecoservices As venture proportionate sales anticipate to of in XXXX, be million. higher growth

would anticipated the $XX our Excluding expected be the impact, base pass-through growth in digits. cost mid-single million sulfur

on be pass-through the basis. low effect the into we higher percentage of up taking to sales However, sulfur double-digit costs, project Ecoservices for a consideration

continue we believe sales traction our be Catalysts, of applications global and to there expect sales to biocatalysis outpace and will this Materials Advanced and that continued year. advanced of silicas demand for catalysts growth, polyethylene For higher we

result, sales to XXXX. double-digit advanced project percentage a to low As be we in compared silica up basis the

the we not at albeit saw stronger expect we hydrocracking joint the in catalyst sales, venture, Within XXXX. peak year Zeolyst level for a

at XXXX. up projected joint to in For range $XXX and range a the slightly Zeolyst to EBITDA adjusted to million percentage growth we in be the $XXX to be is compared flat XXXX. mid-single-digit sales, cautious on anticipate which to of sales sales we midpoint up be to of remain anticipate up We basis. venture million, X% catalyst the the Overall,

basis to segment we to million anticipate up of a mid-single-digit EBITDA of adjusted terms $XXX percentage be on In results, within million. a range Ecoservices $XXX

mid-single-digit sales. we Materials products be discussed, Advanced the range certain can project of segment lumpy $XX basis For are a and often EBITDA the and they previously percentage Materials Advanced as Catalysts, have adjusted we noting, be to event-driven of to in $XX on million up as within sales Catalysts million, large

and heavily our second to weighted similar to earnings hydrocracking the by last more specialty sales. timing half catalyst custom be expect the also year, We toward year, driven of of the

approximately expand anticipated our City and this be We the expenditures to at are expect for capacity $XX expect as site ChemXX. ongoing complete by reflecting in $XX the polyethylene million expansion we the activity range our corporate XXXX. million catalyst investment to in to to be of activation our costs million year Capital $XX year-end Kansas capacity year, at incremental to catalyst

free cash flow a XXXX the for As $XX project be million result, in adjusted of to we range to $XX.

XX% interest XXXX. million as For caps covering interest rate our of well term expense we expense, in repricing approximately have million considering the interest for of the expect to be we recent to as place loan, range $XX our the exposure in of $XX

and project of for be terms first specific EBITDA the In $XX XXXX, quarter adjusted for we quarter first Ecoservices guidance of to million million. between $XX

plan costs. expected quarter the to with timing of adjusted in EBITDA of is XXXX first spending, XX% conduct the the execute While of customer of more the EBITDA turnaround driven costs the as first be is than our turnaround to the lowest planned historically annualized quarter, for lower turnarounds adjusted maintenance quarter fixed typical and quarter first the to we coincide We customer absorption turnarounds. than by

we anticipated Kurt costs. advantage turnarounds, We mentioned the also to second through acid incremental earlier energy other contractual part first the of pass-through complete services volumes of that virgin timing including taking and quarter, costs, year sulfuric stronger the anticipate also higher as expected be in are of and of certain the demand index acid which lower and sulfuric the in within treatment our

more first we typical Advanced fourth segment, quarters strong expect lighter on catalysts. between customer the hydrocracking a specialty a order and prior $X second by certain and based be similar and third sales project Therefore, the timing year, million million product within quarter. adjusted we quarter the for of and quarter the particularly around first and to custom $X Catalysts, For Materials driven timing, to EBITDA

unallocated some first Kurt for $XX now EBITDA back be $X expect the call million. Assuming million, remarks. of quarter approximately for closing between to million expense $XX the to turn adjusted and we consolidated corporate I'll

Kurt Bitting

In production a expectations and Mike. our you, environment challenging revision of for in sales XXXX, into macroeconomic sustainable fuels. of near-term the Thank experienced retrospect, the we global our remained

businesses performing However, exhibit industrial to and many in our resilience, of XXXX. continue core well

technologies significantly of efficiency that saw services our I production for Moreover, fuel, their delivered my we many and recycling objectives, that regeneration and deliver believe significant the we to continue advancement that the carbon and Day. in our out biocatalysis of remains including and of will Our want polyethylene. our Ecovyst in include XXXX in intently applications. growth improve Investor November into business compelling the and aviation that to beyond. growth. their businesses, of support and contributions advanced for industrial key to focused acid enthusiasm and catalysts of XXXX technologies objectives of make silicas capture sustainable sulfuric laid executing on of the future stability Ecovyst strategy on production its expand progress for These at of we as all in our sales colleagues in technologies continue provide we thank and significant virgin we that XXXX on advanced growth strategic our continued engagement

our emerging segments. recycling production core to on customers capturing biocatalysis trends XX last reliability, are and and our have in where work months. debottlenecking leaning the with advanced applications, pilot about and the for expansions spoke created and we in and teams our the marketing enthusiasm capabilities in innovative our dedicated and resourced I growth focused We enhanced industrial through organic Earlier, emerging across favorable into businesses investments

portfolio. we enable our technologies has to Ecovyst the or strategic Board our enhance Catalysts We XXXX. core is or also that doesn't product that company expect review growth end comments Directors has adjacent December, regarding the and uses we launched to Materials a the of that of add in company or scan our completed or and opportunities announced emerging that determines continue Advanced to required of intend In for could make in volume The business, the review this disclosure inorganic it review middle until further been public strategic currently complete beneficial. any

into in move Broad remain result could chains. As we global environment and macroeconomic geopolitical impact uncertain. potential factors XXXX, implementation tariffs of throughout of disruption supply the

of we our the as on growth line and shareholders. operator XXXX, However, growth delivering remain performance focus this time, planning maintain our for will the to we value open At resilient and capturing businesses, industrial future our remain confident core for and we in for to questions. in committed ask we are the will opportunities I compelling

Operator

[Operator question We'll first our Patrick take with Instructions] Cunningham from Citi.

Patrick Cunningham

Just in out your timing maybe of own financial drag a there How on of a impact turnarounds? call which and business. perspective price this decline anything the sulfuric virgin across And off of sort have each [indiscernible] cost do what the terms on further you is from side, starting volume the first to the maybe much just means cost from of here? is

Michael Feehan

cost related are of are turnaround incurring customers that addition, to some the of be on our had made dollars. the up of million sulfuric virgin the Kurt costs another And few would rest mentioned that as million acid an components then timing turnaround From perspective earlier. timing as the the well absorption our costs inventory timing of of a impact. fixed size, in our a we're The from of dollars few

Patrick Cunningham

of some demand. weakness you on near-term just then specifically on cited the And polyethylene

to order out in think improving just stable trying for demand levels? we're patterns? is I'm this Is anything not specifically in of overall as America. market as North increases to terms your I low see much somewhat the you PE call there in things from understand, hearing

Kurt Bitting

Asia. that I obviously like we there's think still see some what is [indiscernible]

think what Middle case, and though, we about their benefiting I Eastern would our customers you with from position. agree said in America North energy

timing, timing. it's In just order our terms order of more really

did stock we expect second to going quarter, It's say, and pick in up first the So ordering quarter. our pattern, half. just in fourth that up customers I'd be built lighter a to in the

do expect said on to call, our business the we silicas be Mike up advanced year-over-year. As

Operator

Aleksey Yefremov from question KeyBanc. next our with take We'll

Aleksey Yefremov

I model lot from good stepping think EBITDA low anything are maybe for as so QX you appreciate historical that a the would looking details Any they broader your that providing and this guess, would still be on think far severity the I temporary issues it quantify is company to of But of this of company a perhaps as be is used unusual, segments. sort you be I and that as led QX, just a of each there at result? or to perspective the record businesses helpful overall to goes, probably in my back, not you case. or in of these just guidance. them for XXXX the expect as for total

Kurt Bitting

and I'll just about take of qualitative maybe the the business. the aspects first part talk

which ramp we plants. So turnarounds mean, acid, I a somewhat X that that's the our unit that of gasoline in really X be although on turnaround we to factors from of coincide think good is remain a first standpoint, our going the a year I this and importantly, From alkylation well terms happens virgin take the The broader We year first year as the greater have expect turnarounds production the in to related activity, of half our going more positive in refinery business stepped-up half, just regeneration be sulfuric second be the we're expect this to side. that on utilization. in amount. to more to good normal. expecting and is It's regeneration there sulfuric quite in do half that is a acid, going year. surround to Virgin perspective, with

higher in as happening spill expansions for beginning orders demand of which battery second as that the with kick for we over starting segment I the half as demand project, well to the new to mining is will customer half the year. higher their will in are us. our going plants X new have year, well forecasting our in of second do of nylon note, turnarounds business We the have, precursor again, of X the in

comment So remain issue. some bones the really is in you Mike, terms of the more business, can on financials. the This solid. of of a timing

Michael Feehan

I'd as of Kurt's we've of for of concerned talked every the on feel about timing we quarter that mean is or a the when I business, are lumpy. every is just that that side. a custom and this Ecoservices Advanced about. the we it's orders It's of very just similarly whether types year the Materials and unexpected through And hydrocracking not specialty Catalysts or anything echo comment. an catalyst. And lot went lot event-driven catalyst orders, There it's through. timing come those just they the side,

standpoint. So did year. movements some and again, for quarter, have big heavier it's definitely the the second including year is go us. look we back then for not you've a quarter-over-quarter, of from that historic a half delivered seen low and a you It we a last end at Aleksey, historically, if concern when But AM&C,

provided. the we QX order be that we're cost and to a on to still of purely customers in we're aspect different variety a The that primarily then going business. that for we've with side items timing the for the book confident deliver Eco AM&C talked the So about, along is able results our the timing

Aleksey Yefremov

maybe low incremental us your you versus margins your excluding you've projected give net typically million. how a $XX bridge the high follow-up, about given Could as million somewhat guidance? as a And just sales of $XX a up in walk to pass-through. guided go is increase, are. I This EBITDA EBITDA just strikes for sales that think margins to me

Michael Feehan

sulfur EBITDA. I again, sulfur a inflates pass-through top impact But think standpoint. impact that is impact the point your It does the about line. from not first the a our margin negative just

component that is the our fuels particular, it. are sales There's the do business talked we've highly hydrocracking certainly past. not say, profitable in for as have in in AM&C -- where mix that as about of a a of some primarily also component, So you sustainable

turnaround for higher they a about go well. costs to there FMC is a talk So We standpoint up. dynamic overall as mix costs did just from start as

for However, increasing well our we sales as are to commensurate pricing difference. that

of the bit as impact little a and it's the effect well. then mix So sulfur

Operator

question Deutsche Begleiter comes David with from Our next Bank.

David Begleiter

Kurt, why you least Board this discuss decided to the on do this review can at business? strategic the on review, now

Kurt Bitting

core we are polyethylene emerging around is can really good to how the that other the it. maximize its alternate biocatalysis shareholder there looking ways such. and as And as do to businesses And They through, have that just well hydrocracking, technologies current value. we really than walked see Board setup.

what looking we So of great business some way that as that's create well high-value different core really is there And to is a opportunities. value view a as stable emerging its setup. a we're terms in as business, businesses at further shareholder with

David Begleiter

forecasting on year the full at you're guide, the just And low growth. end, no

to what Ecovyst to not grow XXXX? need EBITDA for would So in happen

Kurt Bitting

I that timing think some David. of is always order our on the side, catalyst

can type of thing. that have per some large custom orders north $XX be, order in other and large cases, catalyst we hydrocracking you know, orders As million

in there. it geopolitical miss other the there the we disruption of issues Ecoservices, it current of live are look sale, timing that capturing businesses, part the is the that now, tariffs year. or remained is catalysts virgin terms based any they but but So is take the firm the core today But base came right on of timing of the is to guide question of we some customer of from the with of the not first up Virgin surrounding hydrocracking, activity, earlier. environment at core expect again, acid point really And solid. regeneration, that again, a where strong, businesses, that's It's really, in to on necessarily out lot the which the other our is the comes on the a the this if to floating uncertainty will polyethylene is the I turnarounds. albeit across market of just And of economic based. nature out because actual you of so and that, timing Pricing drag then not be a lighter just half acid, has the turnaround have business. be we the expect lands.

Operator

comes Khorsand Our with Financial. Hamed next BWS question from

Hamed Khorsand

the beat this horse continued specific case? just you really, issue, bringing I up. now to you're could why timing is like or the be going this this the to about to think quarter here, that just but I'm has this Zeolyst talk dead the second third hydrocracking,

Michael Feehan

that I The customer ZI a ago. lot. existence the bring the timing company it around joint been would in say up venture with has there a I've orders the probably and long since been time we

years particular, those change fixed the come timing -- different are And really couple X through from in usually those of out. So they a in are often orders bed X to orders hydrocracking of a can for when months. vary do when

a have go And hits lot thing or to to shipped million delivered December do of large they're Specialty the $XX XX Catalysts. could that customer. that a can event-driven for the of you Those with X. be timing very January lumpy in are could businesses. it order has when $XX to So million, Same and it the

they every X X, different have of could customers. So orders with that the happen X, some years even

the every a times, And those when it's years. few orders customer placed sometimes order often item just booking. So timing it's within are

Hamed Khorsand

year? you case available goes, right as different for emerging and then far And being those expecting you've this about that Are around still this as solutions sales 'XX. Is your year? from still technologies technologies the talked emerging products

Kurt Bitting

As we're we getting biocatalysis rapidly, very terms an in yes, seemingly in talked is products customer for interest customers our of terms industry about the uptick supports of growing some in feedback having the great as call, that and silica from just has the with testing those. very, biocatalysis good

some advanced start into from confidence of Advanced late constructed, good kind in really plants is XXXX being you process sales are plants So I'll and we in we we've point to of as the those built. had hitting feedback expect customer and get other really Those in where one that. recycling good recycling continuing thereafter XXXX trials. to have and those

we're So we're are on emerging feedback products. very think those and the where that with happy testing pilot and from we're largely we track getting technologies, customers who the the pleased

Operator

Alexander Jefferies. Laurence Our next question comes from with

Laurence Alexander

call out like as Because are is AM&C, sense to EBITDA the or what Firstly, fuel you percentage the outlook. give those sales heavy-duty for on can being longer-term and jet subpar a of tied categories? sustainable you what

Michael Feehan

of with any is it the of the of of Zeolyst haven't orders. venture. largest to the business. Again, We of really hydrocracking joint specific part component has that timing size given the the The do ranges

can emission The second which year-on-year. or And the renewable custom sustainable as the then probably really specialty one diesel well as really the catalysts, one. and size is the fuels next really is vary control

So we've of XX% around being the sustainable the AM&C before fuels sales. talked overall about

or So little roughly, last the just that a probably from it's that year. range given below decline in

Kurt Bitting

to sustainable the to call, had slightly be this And terms I potentially flattish expect we in said do think up just fuels, year. it in of we

in XXXX as decarbonize in EU the the mandate of had XXXX to So started it to you at where a the as still will then place last when did diesel not sustainable as rate year, to grow, XX% business targets term, continue decline. steeper has that obviously opposed same fuel for well believe it of And still in And there's XXXX airlines need maybe blending heavy-duty we because that it now in as that have X%. that, -- long vehicles. U.S. change a aviation a has have blending

So we grow there still fuels there, those is and to term. a them for long need expect

Laurence Alexander

thinking update exiting sort what on trade-offs around keeping the your And give Zeolyst of are you JV? the an can or on

Kurt Bitting

XX Zeolyst hydrocracking to catalysts, our around has expanded key joint part the really has We've now JV into custom been Since was sustainable intermediate catalyst. been a venture existence the that formed of a control. in emission years fuels, inception for different dimensions expertise as being that of JV, and going of zeolites regarding to the the the multi terms in

growing grown it's And different advanced area. we the recycling and areas. into in are substantially So grown now quite

are one one-dimensional a lot in geographically time. over a of them like grown JV, they're not parties it both This invest centric. the product or willing been has JV it's have So and to in

So continue into to that future. we we way operate the will consider that

Laurence Alexander

go or timing as lumpiness? the And around you at did that several like to a quarters? factor your against issues, continues assume to Or to rate timing of the clear, same be then in normal degree of is last timing lastly, range tied the some just level the it you outlook has

Michael Feehan

fold mean depending just a positive be for customer the No, from on orders we and think what shipping can into things and I the expect. and those come is certain timing standpoint relative typical negative when standpoint. I

it's a relative So within range.

Kurt Bitting

have to Ecoservices plan years good turnaround we're out, very visibility to outages X customer that's the too, X able that on we why side, around our think times and I sometimes maintenance And own and our them.

year, So into their period and of maintenance to so going we our It have just first it's pretty concentrated kind up happens good in this of first half. between half and year the the those heavier the visibility a are where into maintenance is land.

Operator

McNulty with comes Our next Markets. Capital BMO from question John

Caleb Boehnlein

for This is John. Caleb on

we've EBITDA XX% So EBITDA? the I first going within it of is to the talked about full is half. should be know first significantly in of the Or But year order the your less seasonality where half fair to of and say be range it like impact the to normal lot timing a turnarounds that it's XX% than that? the

Michael Feehan

the XX-XX direction the Ecoservices you that give side, for split. I'd a So it's roughly

around the come related and second first roughly about lot the of items. turnarounds that is talked XX% that in the half topics timing So and from a and XX% the to in earnings we of half, would the

AM&C it's split. XX-XX the a business, For like more

it's when dissimilar if not back again, coming at expectation you sales look of again, our those last through and So those year, of with, for the some go are. and too are timings

the So X businesses. split for would the those be

Caleb Boehnlein

for like year the least get math the that QX full the QX. is with QX to at to trying midpoint implying But like XX% double like at that's be reconcile. guide, EBITDA I'm

Michael Feehan

and are. usually before from and QX bell No, that's right, typically a seen I what have for not you've quarters. Ecoservices, expectations our think, it's curve Caleb. too they QX are more QX and I QX are lower where of stronger mean again, dissimilar And

have for and the second reasons swings of have. And other quarter-on-quarter with items, catalyst in specialty QX business hydrocracking quarter. again, AM&C timing lower the that and artificially being So the of then the for significant we we significant about, a that show would talked because can increase custom catalysts that

Operator

comes with question David CL The Silver from King.

David Silver

to million $X have kind put could is expansions? is slipping. But it $X sustaining? budgeted just been a $XX in and budget, of are buckets, Kansas you in call maybe how the if that might CapEx is year. million nonsustaining might much maybe And million, for want balance think general, spending Or discretionary then some little I right, ChemXX you of out? just the that other you for items I money all If there in that ask bit the City of million to $XX XXXX, this more is but have I

Michael Feehan

You $X There are probably from growth or last mentioned, that as year was year this correct. you about all million driven. $X to million, rolled is

the some best good projects again, cost control know the first business our those predominance to Group into that all can at dollars really either on the that the return expansions smaller back and for goes us return that since believe as as are the it's is related in the And we other strategy Kansas in is we look it, we under will few There's growth-based. catalyst Ecoservices. way that's million have and capital that activation business AM&C projects. other -- a So we under allocation dollar and City spending projects the and well probably here there reduction ChemXX a we give

money the be going is next where that's to year. So for spent

David Silver

or to taking but in but know approximate maybe back events read your at I Maybe like genesis a in I it's And the I if the is behind things maybe oranges But there. the on impairment. still be portions juggling what stock description or was might the mean, your more think color different seems original I'm general it XXXX, explanation, saying, there's the you're different go would charge. cause it a of it in ultimate -- the pretty of general, level, transaction impairment relatively was cite citing if just was trigger modest or charge? some or tiny I know, I to price to if impairment And clear also back it your did apples want if thinking a current business that don't I your original and you the you're then circumstances don't of the you accounting And did carefully. X that. that bit mix.

Michael Feehan

absolutely the that or stepped Zeolyst You're to up ago in right investment venture combinations. our business was original years related joint increased

to given done around increased and control that saw we value in your then So with was demand the the focus, the point, and of the information at time. the we've purchase calculation, from it a fuels to last there led our step-up. reduction decrease back that of what that then fair What earnings year some now, particularly original at current the sustainable emission was then and accounting done back done

only a was that step-up portion that original it reduced. So of was

investment from related adjusted. So that from the venture in step-up just we the not to was original the combination had Zeolyst joint reduced that the It's years is ago this. business

add of have the that the So helps we accounting for hopefully, It's some joint the that impairment in entry investment venture. journal clarity. noncash

David Silver

sulfur And clarify, is if can you've on are I apologize. you and results that of the talked just what lag quarter just second But through meaningful costs by I passing is quick rising. lead maybe in angles, here. just that the here? squeeze hope could sequential or the sluggishness prices significant In the a you'll in the part recoup sulfur of But costs? ignore sulfur I we should a first pretty Or about in one increases this words, rise couple quarter? other from in

Kurt Bitting

just the about terms turnaround. what I in think demonstrate costs of the we're actually refining sulfur talking

generally less the So is coming out of reason sulfur costs sulfur rise refineries.

a refining of half the So reasons in lot the first customer the activity that's turnaround the of here of year. one

an risen have improved purposes there's I So as And that think agricultural outlook that's one well. reason prices for that. sulfur

jump So the here quarter, out. in you first pointed prices the as did

of of Virgin that's some good. their looks really again, us of In we'll the is to a to Most from year, acid, in has terms in of back but as we although terms drag our sulfuric lower in it, start second these we pass numbers. the in of business see have any significant same up. a still of regeneration customers due because I don't terms in -- first facets the of new lag quarter, there solid deterioration half lag, the go of nothing activity we say our customers on turnarounds, through do lower particularly think material the volumes from into mostly it some a quarter wouldn't there,

Operator

I'll questions It the program additional closing remarks. appears this or back for speakers time. no the at turn have further any we to

Kurt Bitting

I would say everybody's the conclude with we'll and and appreciate no questions, further thoughtful questions, call. interest we

Operator

XXXX disconnect Fourth Thank Quarter your Webcast. you. for you any participation the at may does Earnings Ecovyst Call time. Thank This and conclude you and

Ecovyst (ECVT) 27 Feb 252024 Q4 Earnings call transcript