OLN - Earnings call transcript Q2 2024

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Operator

Good morning, and welcome to Olin Corporation's Second Quarter 2024 Earnings Conference Call. [Operator Instructions] Following today's brief opening comments, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded.

I would now like to turn the conference over to Steve Keenan, Olin's Director of Investor Relations. Please go ahead, Steve.

Steve Keenan

you. Thank and joining everyone, today. you thank morning, us for Good

include this remind with question-and-answer Before these or are will actual note I'll and could performance. that of session regarding discussion, future expectations follows, forward-looking the we begin, projected. that and differ you materially along Please those estimates slides the that that statements statements results associated from

events. Factors that from limitations earnings the today's factors yesterday's could of Risk our in in be will are of results in differ and on cause transcript recent Some to press most our the without projections described the and past of Form website section our section actual Investors slides available release. A XX-K copy quarter second under

and data your to Todd and prepared with call Ken? available over press this remarks financial to we'll me Releases. With Ken and Lane. earnings begin information happy now Press Olin's are and Ken take Olin's Our morning thereafter, our questions. the CFO. I'll We'll under release turn Lane, are Slater, CEO; other be

Kenneth Lane

storm, responded. our with facility very proud one want the of Hurricane during and a hit each I saw we Texas morning, our safe. well. supporting I'm come everyone. other's are as how We but by members with onsite best following team and direct colleagues everyone homes out start Thank you, Freeport, how the Steve, that saying all another, only good despite Beryl, are to on grateful not by

during who significant thank to stepped experienced to their want help personally recovery. Many and of damage homes, to the team those I up all members

and Olin's team to the some we storm of safe. limited While preparations members and impact kept experience of our the damage assets, our neighbors did

delivered businesses improved offset second our performance also strength seasonal modestly pricing, with improved its in Chemical military as higher were gains improving White expected, Turning strong partially second by and quarter costs our propellent Flyer. pricing. objectives, Overall, and as Winchester generally on a quarter quarter demand the with unfolded to results. continued by

now macroeconomic second clarity we the longer industrial demand to looks the economic greater have and half, around in typical. ahead than ourselves customer be Looking to find we lived global supply. trough The outlook,

Beryl a during expect third on Chemicals our quarter. XXXX we have businesses full $XXX We outlook the the year outlook. represent for approximately adjusted setback to of effect Hurricane, our the current Hurricane and our including lowered million EBITDA of Based

remains balance Olin market great liquidity positions. sheet, in and investment-grade our shape leading with strong

during remain to to a commercial continue and continuing will improves, disciplined were focused capital Also, as serve a quarter. our activity recovering we that coiled executing be spring We our on we economic future strategy as demand. to the with acts value-first bright as anticipate allocation Olin and strategy

to Slide the flow. maximize half to highlight to efforts second X, our Turning I'll cash

continue to cash focus alkali XXXX. teams Chlor restructuring cost Our maintaining working expect reducing by requirements, realize of generation done Beryl of spite half assets capital capital continue half. to to discipline and in around reducing Epoxy second the will second expenditures Hurricane through lot and our in on a the We've benefits of and

stay We focused opportunities. on will discipline and to continue explore additional cost-saving cost

for & Now Vinyls business. Alkali on Chlor turn update Slide an to let's our X

to demand U.S. little and proved of below continues During seasonal disciplined underlying saw shoots restart not anticipated industrial to Global green markets. chlorine the improvement, volume. extremely to been typical demand weak Olin customers weak, pre-COVID as levels. optimistic. second quarter, but still it continues or to we with half has The recovery the chlorine growth remain sought assets well sell running U.S. second demand activity during overly

per Texas made wins in measured of sustained at our XXX landfall Beryl on miles mentioned, previously excess July site with As at Hurricane Freeport, X, hour.

repair damage. ancillary and remainder Our landfall, monomer to be remarkable has operation. resuming equipment quickly damage has our than from to returned prevented Today, Freeport X restarted. assets, remaining including restored, will Once phenol/acetone plants Wind chloride weeks and Olin vinyl production. to plants many after fewer critical is assess equipment those the safely team mobilized this

supply Additional resulted momentum. global outages in have tightened and pricing caustic has upward

We'll our Epoxy look business. at

Let's results Slide higher second Epoxy lower X. quarter pricing. cost in improve continue turn on to to the and

both be Hurricane Germany Epoxy and resin quarter turnaround. the Epoxy plant our results Third will at challenged of Beryl Stade, by impact

expectation Epoxy to set for antidumping schedule, this later year. be U.S. provisional Our to continues on progress duties an case with

We subsidized and recently parallel field level launched Solid a to all the the as levers are encouraged global Union of European government dumping that combat available playing the investigation we pull Epoxy.

critical seen During initial materials in the success retroactive This to that in accelerate each Europe expect the and Olin request has and this for coalition applied, remedy. of these on of producers raises clear importers region. with production will U.S. duties been be and regulators to the Epoxy U.S. second U.S. volumes. potential would several be EU we've their essential keeping both we quarter, import to our front

Slide turn X Winchester update. to Please for a

the relatively reduced ammunition expected, a headwind. generated results costs flat Winchester's availability quarter second sales first rising were and Commercial As propelling sequentially quarter. versus were lower, and

as Domestic defense quarter. and show international military the strength to sales to Winchester spending military will continued grow revenues global continue during surges.

least within is with next is defense grow $X participation. a reputation Winchester over to Facility which Next-Generation a Squad to and military project solid strong of X generate the to the a Weapon billion industry, years. X government-funded our provides brand revenue City Lake platform at well-respected Our expected Ammunition partner

military in trend to see very expected This half We our versus half. military synergies. delivering international we Also, XXXX value to all by continue expect Flyer business, performance new all first the higher coming on expectations revenue years. significantly our increase the in is second of chains, domestic, continue to of exceeding and strong White across sales and the projects

And our financial before highlights prepared to for comments. wrap it turn over now I'll I Todd up

Todd Slater

quarter foundation the and sheet Olin's balance enables commercial currently our model throughout to $XXX.X available our with disciplined Thanks, portion free the levered a and also while in Olin equivalents the liquidity. our in investment-grade deploying robust continue cash share Ken. approximately running financial ended million flow importance flow reinforce cash billion generation substantial these strong Times towards and This like second repurchase. of $X of cash cash We cycle.

by million debt to X.Xx. has ended quarter which capital. from debt typical of increased in The net approximately is a ratio year-end, seasonal $XXX net Our our with working increases adjusted EBITDA with

the reduced cash will XXXX. deferred to plan first by roughly capital capital now We've million $XXX flow approximately to from from payments at Our spending We've $XX year-end build. million. our projection annual seasonal be into year-end tax second million for international now Beryl XXXX half cash our expect similar half of Hurricane $XX We to successfully returned capital working XXXX liquidating approximately of million $XX benefit requirements working XXXX. approximately despite

similar With to all these initiatives, year-end year-end at expect be to we XXXX. XXXX net debt

of approximately under supply energy $XX X%. XXXX contract free payments long-term our onetime Excluding levered yield a equate flow approximately cash million, would to currently

few it I'll comments. Ken for a back Now closing turn to

Kenneth Lane

Thank you, Todd.

the we share ECU and through leadership years, it the achieved troughs I've in superior and trough-level ever of buybacks team As we've that due generation cash one longest recorded is to experienced and fight discipline solely flow the strongest Olin's trough. values during over XX

will on Exchange financial and the hosting and will businesses, announce to be that York XX review excited webcast. Olin of Day in-depth Now provide finally, via leadership Todd other to strategy Investor an joined I Stock members be an of December Thursday, and at I'm by our team New goals. the

be you but will will the hope you to as more day, details We we many share with us. join we able of closer get to

Operator, questions. we're now to ready take

Operator

JPMorgan. Jeff Instructions] [Operator comes The with first question Zekauskas from

Jeffrey Zekauskas

defer did international been will your smaller payment larger than next be year? your would have year payment? Why you or And tax it this

Kenneth Lane

let take I'm to that question. Todd going it and is this him hand Jeff, Ken. over to

Todd Slater

prior pace into defer it to that conclusion relate we Sure, to we to 'XX. to tax about able million is even the it XXXX And without back Jeff. does the we successfully cost in of years. international This into international the XXXX Based additional had tax on of that $XX international Olin. payments incremental those work, are talked of -- related deferred

incremental no million cost there So that in than other is increase payment. $XX

Jeffrey Zekauskas

in relative that particular were are reassessment And your half, the that there second slowed expectations? areas -- for of your Okay. of terms to have demand industry

Kenneth Lane

that take Ken. is This I'll one. Jeff,

back see the to half the in even lot first in a was start year, were improve the there So quarter, to second of of in year. expectation economy half the going first the the that we of

second consensus for to didn't half was were I coming develop the businesses. grow still think the around that, closer we frankly, is we But inquiries just because And to some in pretty really again. the got much to as in economy, struggling volume start that they our across industries. seeing

thought we those than have to seen particular significant maybe but the not difference any more I TiOX any really There wouldn't couple some say polyurethanes. in in have, would that were what stable industry. a that of one have be Both any shown in improvement be growth. we've maybe space, continued there's there

that QX, which uptick going see market, a the the So to There in you were the see in we saw to seasonal year. in no really second half expect saw growth that underlying growth of was of normal was volume uplift. if the more we would you

Operator

question with from comes Next Alembic Global. Hassan Ahmed

Hassan Ahmed

beginning of looking obviously, commentary you obviously Hurricane -- year. guys be as on demand I the profile in the just if to of more around around us things. you're at billion mean, $XXX around have $X.XX But numerical XXXX reset million question the to a thought include the as the guiding Hurricane you the not given demand seems of of and EBITDA, sort expectations impact, it Just sort and excluding that side you impact. XXXX great

of earlier, it just that think around better of lowered seems power sense was has the the guys terms trying billion then of $X.X get been company? billion. bar earnings a to few trough I'm It times. Because $X.X you to a $X So billion the in just what

power how guys So better the a sense earnings of company. about the are to get I'm thinking just trough of internally you trying

Kenneth Lane

to trough. at are you the And is, level business, last earnings. the what XX represent Thanks for trough will that, the the What position Epoxy think think, that relative of And even in that I I look in expectations look performance. historic certainly question, say say you would at are very if I a a certainly the is if would, months, unusual we Hassan. is I

really having the seen we've in driven level. and a markets, on typical China and capacity, antidumping by not which cases impact It's got that over both that's there. we've new know in the that investment with the we out why U.S. trough the Europe the is So that's

bit expect this around of going to it's this at case. But level, is earnings significantly that continue the unusual think be don't of an to So going longer. I level that's that a trough somewhere do I level

we've that green trough said my soon just need in. China in to been this is in I a long in see As but comments, also shoots, start markets, U.S. the we And prepared not as very really the in Europe. improvement, recover as the going start to is very, economy we I demand to say, seeing the still it's the to even get and in probably market, see would early, some there. very closer China Europe but

Hassan Ahmed

just EBITDA notion talking incremental million, give will you sort that with initiative $XX about the you to sort even supply trough And I the [Technical guys of Difficulty] [Technical and tailwind whole could quarterly of potential of maybe to Understood. that that you that guess late follow-up last demand value right? and was million $XX accelerator of how incremental as were kind EBITDA Understood. And were Difficulty] and uplift. year, be the a a question guys

assume is to really in now, not your -- to [Technical were right fair it as results that Hurricane it excluding QX QX QX. slight a mean, I the impact, to the in increment Difficulty] stands So QX,

Difficulty] not So and from Difficulty] think you're fair normalize. and should really when of terms your when all that assume that EBITDA value initiative? is And returns of it [Technical demand rates as to at in accelerator operating currently seems we [Technical as

Kenneth Lane

Yes. breaking Hassan, were there. you up

it, it. if back got can I take think, it. then And I come don't a the gist answer of I shot at to we I'll your question.

we that fall the the had in has year, were did we stop the proven be year to price. And end that successful of cost because we with of at that initiative Listen, the successful. value last

and our seeing that pricing Europe but time In and at fact, this point caustic in in in not the outages, in upward we in just momentum continue to see also system, we're firmness others Asia. with even

are to there going so us, value want not selling -- system. support there our away our the only for strategy that is to firmness values we pricing from is in have But is in we So the where and of forward. that we markets see acceptable moving

value of on trough. focusing us relative And maintain to continue. to level continue to what going is profit is is strategy that So historic very to help a going high

the generate going flow continue very to trough at good You're see level. cash to us

Operator

next the comes And America. question Bank with Byrne Steve from of

Steve Byrne

about Freeport. I've got questions a couple of

are priority issues for of operations they that and are Dow but for operation now? You still indicated in know, don't there mentioned I VCM they the phenol, get the chlorine, the what that getting chlor-alkali facility? your significant in But general, four of plant. most chlorine out restart perhaps is right

Are question that? what what are are for relative a to your maybe anticipate Dow plans is, margins And with satisfied on longer-term for EDC shutters Do you the making you getting their when off Freeport going operation? be to further downstream? PO your of you're you making EDC customers

Kenneth Lane

ones are the joining -- that Thanks correct. us. are named asset We you're yes, down. still for The that you

chlorine of yet. capacity have there restarted We the all not

We're we've there's know, there's that the that. and news to support really is the through to damage But phenol as a you continuing equipment system-wide. not acetone -- that majeure to and assets. work chlor-alkali assets VCM As that force good any got the

operate course, we're that going us Freeport to great to there Investor to communicate assets at online for and working options. future Day up the the asset and strategy. the we're we're discussing priority end site, we're not the And is our assets later and the to year. customers going going working the able that's this able And a everything So but through sharing of you to that highest look option at to work But through we're at find the the value do with assets yet, coming be question safely year. when the to those forward the for the still with be through of getting of there back to that's happen. With regards to

Steve Byrne

undercut for Europe U.S. Epoxy. And And that as for government in and these that? and enabling be the it that those support question antidumping require traction? get view some to energy-related, your but on on what a what's those seem price you to then respect would with on quick to that is just order initiatives countries you you of to Does -- initiatives Epoxy? It in level propylene- some outlook four

Kenneth Lane

over what last our been That's are we online. again, rolled subsidized created have. tremendous favor fair That dumping seen have imbalances, and Well, we operating these way threatening and markets are years, that production. local is trade. few to we outlook are free And have material people what is has in that want the a into there and they assets that

So States materials as said are some import producers, very risk. the protection Europe intervention we to prepared the United to and see And get the want duties -- to we think they domestic in some I at I with both in are that if market. don't these to remarks, produce in and continue much

So this we'll plays see out. how all

later this announcements expect favorable the local to around producers. that for we year, some hope that to it's expect and see see We -- we

Operator

Fischer from Sachs. next with question And Goldman comes Duffy the

Patrick Fischer

Freeport just or of startup are the you we months? time there? weeks mean, line restart? an you Could I give or roughly the clarify idea Can us talking

Kenneth Lane

process. to Yes, mid-August, looking the start-up what scale weeks. you, approximate there And around at, out we we're assuming we the is for put really that of is sometime impact kind it began $XXX the is million just

but flip is at don't sometime we running middle assets assets You first a least up August these the of around switch are what started on are the and get assuming. the day, we

Patrick Fischer

one maybe for Todd. And then Okay.

XX is But Can Is the you just days the price least at average average us buy? even the was far XX it with that we a in it through, walk about on I in stock couple how I like numbers of why looked only it it of quarter? the a there like of that from mean, care On kind -- think do gave, you the or so Or are at the days quarter? you were you off quarter share. $XX. the was take of buyback, $XX your

Todd Slater

plan. the Thanks that, Duffy. the XX-day number say, associated are price. pre-owned with generally, period. X% under over operate at roughly repurchases. the that purchase We our the weighted I'll quarter, Over XXbX quarter question, below or a Don't included is forget average And do share for in purchases tax the

be a throwing be that off you little may So rounding bit little a may and you off bit. throwing

Operator

The next question Yefremov comes (sic) Aleksey from KeyBanc ] Olin. with [

Aleksey Yefremov

that $XXX million did your And year, if Beryl you assume goes do I does, outlook, wanted EBITDA confirm the insurance to if completely in in impact away future? you recovery? not, And include expect fourth full that any in just quarter? any the the also the

Kenneth Lane

a in levels but based we At this in do be We on expect the deductibles, Yes, recovery point, we terms where that's the third the and insurance just expect third don't -- to of event. be is to quarter. that should any QX all that that are in all damage have the all quarter.

Aleksey Yefremov

And for been Okay. seat some I Ken, your Very you've time. mean, in helpful.

shared just Any current You on the of in chlor-alkali thoughts the view sort rates of is sustainability for your near which system? weaker. on operating demand,

Sustainability to been thoughts last and share the of Just you strategy and value for want pricing operating your your way on pricing couple for strategy of company of the this. has years? run overall the

Kenneth Lane

are have and tell you thoughts. operate. I we that what Yes. mean, my be we way sustain I'll going believe able to the I much very to that we

do initially, and in adjust based I I'm because operate. operating very And that very to But learning think that not our model at on the through the with plants. learning very it's we're done progress that for thing this go differently. And again, just in manufacturing well last have the think how Aleksey, that teams change to they have running is it's made We've rates, real some commented everybody, curve a side flexibility of value. we I call, the being to learned sort shown but on on at impressed in I have the the earnings how well. They it also to operate commercial the on you have able that how adjusting.

And continue going sight to something look to we We'll to lose costs. we're areas is optimize That also reduce do to that of. are that. to and not for continue going

years, the are costs on base going reduce you to what you can done And left, over that. like really focused organization. do ways we still as We of really, as you can focused you the be we're very to you're have staying find couple as optimize rationalizing an imagine last things assets, and that's when to that continue on asset

Operator

with The Bank. comes next question Deutsche David Begleiter from

David Begleiter

Ken, from any announced July? million the Beryl for does from include increases the $XXX impact benefit price

Kenneth Lane

include does any benefit $XXX The that. million not from

are of second the expecting pricing to in the year. some see We in half improvement

of As especially there we we've that in is around outages the said we believe caustic the there that firmness all market, seen with the world. that

but the opportunity outlook -- include impact. and million include So lost cost that does is $XXX some in improvement really does some the that just caustic pricing,

David Begleiter

on pre-hurricane, operating good. of units those you have? four rates And what back Very again the chlorine were just Freeport,

Kenneth Lane

as before, see Listen, our in demand that and the that you market know, the we like running like. I we is said value meet focus what the to

but or we that in at on to take very we terms a utilization we're on -- them able that. don't flexible we're run want in rates We reliability. the at, be we to levels We want So metric run focus we our very do do focus business. how our out running how to of as performance

focus the reliability. so performance. on a around as look that rate, metric our operating we We And at utilization don't

David Begleiter

running four And today, of are to any those be clear, units today?

Kenneth Lane

them units but restarted do not have we all Yes, online, of we yet. have of the some

David Begleiter

that two on, fair? Is two So off.

Kenneth Lane

specific comment on of any we're around specifics to going No, the not units.

Operator

Citi. comes question next the Cunningham from And with Patrick

Patrick Cunningham

back So half ability your capacity rates? the of operating coming this your online year in does raise there's competitors. and in some does How of back volumes market -- and view, the to the how new one from bring your impact

Kenneth Lane

contracted earlier see up I year. year don't volume that the in year, really already that even later been impacting this -- last has

lot see that the of in -- So I market, know chatter it's that issue. market, the market. already frankly. but being the I already about don't an there's it's in in a it's

not I'm headwind. as don't So -- I a see that

Patrick Cunningham

in trying here, full you've earnings have you given back you're how And the volumes the we obviously well I'm terms half where of as the Winchester. commercial military to better as thinking talked improvement discussion whole cyclicality Understood. the cyclical general in understand for about are cycle about business across strengthened in in power?

Kenneth Lane

the very especially a is to this cycle. than what a It military much that, a international significant Winchester, seen just business years strong up us. generator The that is that has profitability few is. I much military, got cash course, it more step business being City and and in would strong U.S. of business military Winchester really contract, international ago year, we've think business big us in with our for the the was we for We've a it a revenue -- working track more around Army. double been for is business having one Lake this a about year on that then don't -- stable us, the a even very now not

some normal. little bit bit It it the was that a down year. more It's So quarter. a has to little than weaker it, typically this second seasonality in business,

seen space. that you've the goods think across I retail sporting

pressures lot consumer. a the that of on inflationary is to think the I related

side. while to what's it's and for military strong business is geopolitically. now And going, setup more more that the on -- going So to happening for tracking inflation the to going obviously, side the part of right of the track how that economy is business is military general is that, term consumer long track be with the quite the going of

Operator

McCarthy comes question Research. Vertical the And from with next Kevin

Kevin McCarthy

fresh company hear Blue and a been, than the the there's on the a really active White say, potentially curious Alliance potential and growth Mitsui, I'm for thoughts has would for box, of your take speak. What to Ken, views, as Thank and modestly share fair you nothing balance here. say, Flyer bread morning. X to but Yes. The composition so in your discussion growth? portfolio next Water amount or sheet but good inorganic I on advance a on external you, bigger are to at the look repurchases, years X recent years portfolio through with using Olin's

Kenneth Lane

like Well, saw White one channels which been market we opportunities attractive, -- very It's make we Winchester business continue team and that flourish. see with the been Flyer, done able listen, will our what really has if has impressive, to leverage we extremely the that we've to been with White Flyer.

see bolt-ons So run than the to like opportunities think and they're accretive if we we that that, highly to on small-scale be current and going going better we're we ones move can those. owners,

that that, beyond at more Day. we'll talk Anything our Investor about

about want about right balance where You can change the and future, we no thinking in the of terms sheet. use we're now, that's But what how there's in conversation. imagine in part to thinking of we're go we the

this then strong We our sheet balance and as focused continue up on to point. strategy allocation a we are to with continue capital to having going investment-grade stay have

Kevin McCarthy

can impact businesses? types it does of both commercial? impact similar that of those the through are margins in Winchester. -- you Maybe a that issues a in question, would And Or perhaps if or does that some impact as remains to mix then versus and military market, how your in you contrast seemingly that, commercial? the Winchester. versus How military And I quite as related margins tight, Okay. market second on is compare talk propellant may, evolving on of

Kenneth Lane

military The than a Sure. side, military there's is the Yes. margin is on domestic the lower us, International an Winchester commercial not the as as good clearly I is attractive business lowest. the no margin military actually commercial. listen, doubt. for mean, but still business,

see mix of So the that's we the kind across that portfolio.

we're for City going propellant military. one U.S. the of requirements of terms the Lake prioritize around propellant, the That's clearly, In to assets.

So allocation terms way that's volume. of work of that would the in

up. able the our have It costs those we've a and the and been so far, we demand market, very secure demand. gone commercial -- that military that both is But been volume need to tight we've covers

the pricing, look of with propellants, you frankly, offset This to headwind area when the Some that we're but of think of in at that overall, the some going all has I area an an not half year. see -- got in to And been that is we that where that States' it. focus is don't it capacity market for continue there's are be necessarily friendly secure be security the want regions to from how that And from clear to we not strategic national aborting some forward there's the on United even path to U.S. be got demand. to concerns some second that

So goes because to I government that have there's that. more looking that. see I a on think know eager to And is where will the come impact at we're Winchester. on to it But being a physical the going a large is volume headwind a cost securing very forward. be good need, done the job player in still that market, we going we've that but long-term

Operator

And the next question comes from Matthew Blair with TPH.

Matthew Blair

hurricane. I'm glad the is safe after everyone

segments? to Epoxy sounds million I caustic breakout the pricing assumption million want And confirm, include and does but like then in the between it a CAPV just QX? $XXX an full year guide impact, $XXX that there For of better is actually

Kenneth Lane

alkali, if about, precise. roughly. XX-XX split, be about, of Thanks chlor the we've half talked the XX% make that But for about yes, the momentum. epoxy. would for a we Yes. when rough range Don't assets back going around about too can pricing that as The you I your for you kind question, estimate. think there's use see that the of that it's that's XX% we to that Matthew. think year, And think

caustic outlook, some the So improvement market. in we've our included in

Matthew Blair

able moved capitalize prices EDC indicators, just prices fell you're your quarter-over-quarter. to you a according it of couple then pennies EDC market? in by that second XX, what quarter. up And on various good. market Sounds Could in about looks talk But the to system, like do Slide to on

Kenneth Lane

reflection agile focus in can our and got is of for on on have, to previously doing the model, highest and our of to value value our of lot portfolio, I say, we said is we're That's a think to that. we do a we try exactly want better that I've to manage reflected very portfolio that's think is, going are That's that to our what and are right? see indexes, model. there's, you And focus the we that the I volumes but in that some why others, assets what continue for we've there. them the just getting that's than use

Operator

from The Viswanathan with next comes RBC. question Arun

Arun Viswanathan

hear at Yes, Freeport. safe are glad things there to

I maybe to early So 'XX. how to profitable thinking about just I guess circle you're and on back conditions look wanted an

-- And settle feel What EBITDA times this guess, you you we and Is of one interest mid-XXXs inflection I that assuming so it we looking kind see on? of rate this what trough. that in obviously, we is you're is is a of like that of a some in do for macro-related mean sum something expect, I Or kind the of there just to kind growth coming? environment kind are and good else moving indicators So of that forward? that do the year, on? can hurricane-related. on a point of should noted hone couple

Kenneth Lane

Yes. the Arun. Thanks for question,

United of but with happening around just there's everything the globally. currently up, So I listen, a the lot elections even States, uncertainty, that's not and think in coming

next even are going going real that into things uncertainty, any So clarity get the elections on of until year. I after the to beginning we're and maybe don't where think

to what's U.S. more approach, watch going we're housing but So we're that in things of going like to things market. the a taking the are wait-and-see be happening

the local significantly back. recover? still Because begun missing. come housing we rates Are starts Chinese demand the And to market interest we housing that a global take up? back have economy coming grow where are that into is we meaningful has seeing the the really is going to Are seeing and buyers Chinese the Fed begin help step to to economy seeing reduce to

So watching closely XXXX to early over about for see is sorts it way months. start to the going we're a But things of very too coming talking we what be those outlook.

Arun Viswanathan

well, the And Okay. question I then. can maybe a little ask differently

$X.X limitation is So a kind that of little well a have some the resumption maybe billion your ago in a do or that is out, capacity taken be comments now of billion in the that $X normal that Maybe peak given that? on you've would that below if is -- range? EBITDA -- while operations, you earlier kind of

see gone And to in then I significant return in demand. of rates. impairment that pullback, along know to structural their those China markets? lines, especially Epoxy It's prior any growth these of unlikely pretty any China do through kind will has you

they've action own know market to if taken their So enough I rightsize either. don't Epoxy

there like So does some business that weren't seems it past. structural limitations have that in the

chlor then on And alkali, you shut some capacity. again, down

there's I businesses. if the change any been of So earnings wanted power in the to just of understand kind

Kenneth Lane

focus the Listen, be term. well assets that They're continuously set to that our ourselves said comments around the as assets. positioned asset going alkali. competitive those to with in at prepared very very positioned be the our We're on well especially looking I chlor curve. is of we've But going cost are long in a portfolio, on optimizing well operating

will see our back, demand the the market that's we've adjust we the capturing we positioned really coming position are I ourselves. As way mean, in ones that that to be growth.

into us be to more take in the we've it's So yes, the to there away that as time going if have respond very be when optionality troughs that's it's capacity. coming filed. are of why, the to that took we what's your vocal grow some need you does past, back. With some There's need that's you've probably support to point, capacity important coiled to these long those it that for in sorts there before restructuring seen capacity see be there And market. But that the comes markets. to going because think probably spring be when ultimately, we be that respect that that we've happened. market. that again, China think offline, into to able so in is called We to challenges offline, it, a we doesn't the about to able very the some growth And cases structurally, been to antidumping about comes Epoxy, they're

months market come seen with conjunction both it's of over before see that in will happen. and themselves things In You've we not to those growth going but correct it's be capacity typically off. the years, time,

Arun Viswanathan

Great. And just one quick one. last

north do of $XXX of of or will cash that of you $XXX level if million million EBITDA, So kind be maybe free flow. generate you

So preferred are is you're options that deployment cash? of other there stock some Or considering? buyback still the

Kenneth Lane

still strategy, continue We that to and steady we'll forward. our buyer capital should shares not be on that view a value and changing to allocation buyer anything continue shares we've of excess they are very a got. We cash the being to with the be will going as discounted our be our much

Operator

with question next Mike the from Sison comes And Wells Fargo.

Michael Sison

Ken, some you as get mid-cycle get to you and sort might if better dynamics? mid-cycle do that degree, think for can't -- model do maybe EBITDA want Analyst to ammo margin you when the about of And we You've any how thoughts here? some save into to get Day, to how back, growth you but specifics, about volume think we of EBITDA there? closer contribution maybe sort do the

Kenneth Lane

going looking work right going things. sorts is Mike. asset we're things shape Winchester those yes, through and and you're how some where think especially up through now Thanks, at that right we're with to going Sure. and the strategies that's those of working where of that we land, And our

go I when So we biggest is lever about that we're we see think going to are portfolio where starts how of back, to as think I the coil in our starts terms unspring about we see biggest the and forward, thing to that that's when today. the that come demand --

things improvements restructuring over be to some Epoxy self-help going in done there's of time. We've terms reductions. some cost Yes, steady and already around with

the line is We we -- continue had in to coming what realize benefits expected. through that. of that with That's

alkali, demand The the question we'll is real that have cost see recovery. the where when that the in does for look going be to of and frankly, and chlor kind earlier, volume as to know. savings though quickest. said ones mid-cycle don't And upside going back benefit is be, come We're to level it are from as always to happen? that to we well, that you that going earnings the when does of be I as really, that's additional priority that start a we'll well. But put and back get leverage that you As we around to prepare happen

Michael Sison

follow-up, think Right Slide is you Great. when side. And side, caustic as stronger now, that to is about in getting chlorine weaker mid-cycle. a XX,

up stronger, So about is, if profitability? lever et talk of sort creates side And that's that that chlorine mid-cycle, where what side how could maybe is stronger you cetera? which really -- higher in EBITDA needs be meets to the

Kenneth Lane

you And frame. that's in imagine, the than Yes. That's that about that. And time issued. Mike. a shorter-term the appendix a I great know it's the can as had question, all you're It's to discussion much we chart referring

versus the The what one to needs we and run, within see that we the can't cycle, other. strong the we going model as side. cycle across weaker, a very between say, we side the be stronger look So month, change that you It's at be the frequently. the adjust to may

by that not So decision-making to we It's It's that's short-term that's the play. need going think long-term but be frankly, improving chlorine each that's driven demand very going that operational side way that. caustic that's on a the and -- commercial to overall. we we that. a to about And on be that the side, demand help see both the it's going accelerate

Operator

Leithead Mike comes Barclays. next The from with question

Michael Leithead

just to end you half in everything year? leverage about up how to this to the you're year? second second thinking we the this question, a share wanted your previous should the about any capital you're follow of Are comfortable ratio here intended deployment I is expect where earnings in Great. repurchases in backdrop, half? now how Just current thinking

Kenneth Lane

buyer that. Todd with we've Todd, to and do got. continue Yes. excess then the mean I I'll want to add will But to to comment to flow you add ask But I'll on cash that? we again be that, that a

Todd Slater

We've use be now talked We several cash here year. think really the about least I working previously, flow. being And taken capital neutral. in then remarks, second we at articulated improve actions our will prepared to had Sure. our half for a that

million We capital $XX tax the reduced payments, spending. international deferred have of

actions -- would we from enable at the us keep to So the were 'XX. of end debt end where to flat those of 'XX expect we all

in So that repurchase half towards will continue cash levered free that share flow does year. enable of us repurchase. to to shares allow the utilize us back to our And the

Michael Leithead

should just sounds impact you helpful. and improve Winchester super wanted That's chemicals to on have outlook. would I to And third like Beryl Great. flat the briefly, It clarify quarter be sequentially. the then before expected

fair consolidated basis, it third is should like be to So million something $XX $XX sequentially? summarize on EBITDA that a to quarter million down

Todd Slater

had in Mike, -- stock In when based of on the the much chemicals and reduction corporate stock-based benefit compensation, unfortunately on comments a other our your the quarter, correct Winchester are significant outlook. second with you lower associated price.

expect that third continue the into necessarily we to So quarter. not would

that account. numbers -- into part your So be haven't might taken be may

Operator

comes question from next Spector with the And Josh UBS.

Joshua Spector

different demand as levels. point it's for data, in forecasting I merchant this Ken, market? XXXX seeing of of Is look and your about some talked you comments, at the the we in when about caustic below So of earlier XX% would what characterize below. consultant you guess, some it well chlorine How you're at that time? than meaningfully kind in

Kenneth Lane

I No, it's mean, that it's not. in range.

And until Until start really remember, in generally because going lot the see had we're time, recovery. we've we're supporting is coming we lot was But demand where that a the to offline really focused. exports. we and where economy industrial commented economy That's capacity. a domestic back we it's even to really -- see say of taken economy see -- what that globally before. also global of I -- we economy So the

that tightens makes that that that about. -- keep So spring we really talking

Joshua Spector

relative do something how that? some And you at guess, I than I impact Yes. I really still other much I that talked performing of on there's I in scenario? circuit bring additional I the lower. And in of not off a Or go Is a volumes guess, slack an back 'XX, pricing? year. having do how maybe rate can assume a couple see about and earlier some that market you really if a we where point, snapback to mean, you consultant Obviously, capacity. players, kind navigate without greater Olin strong there's lot 'XX, mean, percent that of forecasted a your to forecast, is

Kenneth Lane

time very on Yes. others would it challenging to do an Well, I most these having -- mean be to you any investment going assets of we're obviously, commodities, comment not doing. listen, case make in in a we right? economic have. that a focused the that's I'm on commodities. can are kind But large it's what what around competitive

certainly surprised, something to be would not doing. be we're I going So that

to you're because And looks we're We about naive thinking in to gets different to not dicey. things into worse going know get going we when the get that be a better, enough fall that you're little since got predict it's believe always trough, things never point. are scenarios it's better. to you've that it you at Trying to get when going consider when some to these trap, to and better bit think

be scenarios thinking to about going going forward. we're So

able be a going is back with into the grows it when as be that too But I'll demand there's And that focus. get on We're is comes negative out base to prepared demand and you're and if comes asset going back capture supply think competitive to of our a say that because to there. one demand scenario, distant to be focused that you lot That all outlooks about wrong. scenarios, are market.

Operator

Fermium with the And from next Mitsch comes question Frank Research.

Frank Mitsch

question. the was up the I back quarter. want to the come to nice second to picked PCI into It pricing XX% sequentially that see

of think the And driver about do you the PCI? your looking So how what I the at that? was curious, on system, outlook was biggest

Kenneth Lane

year. I there's of in the Thank I you for Frank. the to mean, the pricing listen, said going before, like continue half to question, be Yes. momentum second

the bit. said, up tightened we've We've improvement, a has seen supply seasonal some there. firm As but is out demand little

some expectation our there this to Olin, point we're the very predict But forward, manage is at we'll the time. it's that able be -- is in goal. of that's value maximize that going have So for going our portfolio continue to to where to mix hard our the and demand we

at maximizing of portfolio. the around expecting we portfolio we half recovery were what value mix and still second more see the year. But are demand that seeing you first recall of look the significant quarter the in we'll in call, that If we terms of than have to earnings the the

Frank Mitsch

I and understood. And forth. indices to comments back coming on so the

So obviously, indices. you guys of do not off of work

internal more to on within out figure going what's Olin it's of system. us the So kind for difficult

is pretty So in I might was sequential of terms XX% -- what what I mean, mean, impressive was I curious, a -- just lift. hefty

what curious, guidance there helpful. sort or So just it was was would be was EDC, sort aromatics? Any it of I it HCL, have guidance chlorine, you? -- it was of Epoxies, Any was

we from Olin's outside, mechanisms. the understand what's so in clicking terms of pricing Just really

Kenneth Lane

the at that, get the And -- we molecules it probably a are way that looking are and values Frank. listen, the I easiest products that No, that be to put it's going place is what mix of portfolio, to of of will where constantly again we are Yes. we because each have. the

kind So that do basis it's that would give is dynamic -- it that to and we'll model a that to we're maximize run, can for agile very be some you would be value. of modeling very we difficult be it a going to consistent continue me to quarter-to-quarter, because as to as

it be can point have and into would something not your able you then that consistently correct. models to it's build So to be I that

Frank Mitsch

that enough, I quarter. dynamics the Fair picks bleach fair standpoint, bleach would it thought And versus pricing XQ. in bleach the I What -- lower demand that second have markets? up enough. was are was going the from a on note in make did XQ

Kenneth Lane

in element the low. with a fairly very very of there's interesting mix it Listen, market that. And dry during rainy. was And Yes. got quarter. then half And quarter, and cold [indiscernible] the was off happened definitely the hot the the what bleach, because started bleach with the quarter really and second

the And odd just quarter. the So during the mix pattern there second was quarter. terms effect in of again, weather in very a

Operator

The final with Andrews Stanley. question Vincent Morgan comes from

Vincent Andrews

more there reduction year -- done for we then it into should in doing? spend is reduction CapEx about an normal And in Just next that not will what SG&A that me. was the that incentive next you're or coming that reduction comp put we with secondly, a And ones should guidance year, think this The back two was that quick in year? year?

Kenneth Lane

question. thanks the Vince, for

year, year. to next ways be but will So of an to mean next will increase done listen, terms we're CapEx, that that defer doesn't to for of look going other some see not things that back things. the come that in We'll continue

operating assets prioritize our in But going those to maintaining and good conditions. we're safely

deferring any assets the and do These are not -- at put So that are that don't easily we're and things that. of things deferred risk.

in to Now terms of do I SG&A, anything on know, the add you Todd, want don't that?

Todd Slater

Yes, big the year-to-date. really thanks compensation. driver Vincent, that's right stock-based the Yes, quarter, year-over-year decrease, what the in but now really lower for so is in SG&A not the And far, question. only driven has

Kenneth Lane

and all to We safe Thank call. XX you, you on appreciate of Olin Exchange everybody thank and and much, at want a have I see look say for interest joined your all forward the New thank Okay. Dave, Stock Well, hopefully in York today. to who the you just very you seeing in you, December hosting person. weekend.

Operator

you Thank attending presentation. today's for

You may now disconnect.

Olin (OLN) 26 Jul 242024 Q2 Earnings call transcript