Ecovyst Reports Fourth Quarter and Full Year 2024 Results

PR Newswire

MALVERN, Pa., Feb. 27, 2025

MALVERN, Pa., Feb. 27, 2025 /PRNewswire/ -- Ecovyst Inc. $(ECVT)$ ("Ecovyst" or the "Company"), a leading integrated and innovative global provider of advanced materials, specialty catalysts and services, today reported results for the fourth quarter and full year ended December 31, 2024.

Full Year 2024 Results & Highlights

   -- Sales of $704.5 million, compared to $691.1 million in 2023 
 
   -- Net loss of $6.7 million. Net loss margin of 1.0%, with diluted net loss 
      per share of $0.06 
 
   -- Adjusted net income of $68.6 million, with Adjusted diluted income per 
      share of $0.58 
 
   -- Adjusted EBITDA of $238.2 million, with an Adjusted EBITDA margin of 
      29.0% 
 
   -- Full year net cash from operations of $149.9 million, Adjusted Free Cash 
      Flow of $85.5 million. Net debt leverage ratio at year end was 3.0x 
      (given the net loss for 2024, calculation of net debt to net income ratio 
      is not meaningful) 
 
   -- Full year share repurchases of 552,081 shares or $5.0 million 

Fourth Quarter 2024 Results & Highlights

   -- Sales of $182.0 million, compared to $172.8 million in the fourth quarter 
      of 2023 
 
   -- Net loss of $30.5 million compared to a net income of $30.0 million in 
      the fourth quarter of 2023, with a net loss margin of 16.8% and with 
      diluted net loss per share of $0.26 
 
   -- Adjusted net income of $33.0 million with Adjusted diluted income per 
      share of $0.28 
 
   -- Adjusted EBITDA of $75.9 million, up 8.7% compared to the fourth quarter 
      of 2023, with an Adjusted EBITDA margin of 35.3% 

"Ecovyst delivered solid results for the fourth quarter of 2024, demonstrating the resilience of our core and industrial businesses in the face of continued demand softness in the global macroeconomic environment. As a result, we delivered financial results consistent with our expectations," said Kurt J. Bitting, Ecovyst's Chief Executive Officer. "Increased sales volume and positive pricing in our Ecoservices segment translated into Adjusted EBITDA of $54 million in the fourth quarter, up nearly 12% from the fourth quarter of 2023. For our Advanced Materials & Catalysts segment we saw higher sales of advanced silicas used in the production of polyethylene in our Advanced Silicas business, while sales for the Zeolyst Joint Venture were lower on the expected timing of sales of hydrocracking and other catalysts."

"We are pleased with the progress we made on our strategic and operational priorities during 2024. Looking to the future, we continued to position Ecovyst to capitalize on the growth potential for advanced plastics recycling, carbon capture and bio-catalysis. In addition, our investments in reliability initiatives in Ecoservices have already resulted in a significant improvement in operational efficiency, contributing to volume growth in 2024. We remain on track to complete the expansion of our polyethylene catalyst production capacity at our Kansas City site by the end of this year. We are confident this project, as well as the expansion of capacity at our Chem32 site, will support anticipated growth in the years to come," Bitting added.

Review of Segment Results and Business Trends

For the fourth quarter, sales were $182.0 million, up 5% compared to the fourth quarter of 2023. Net loss was $30.5 million with diluted net loss per share of $0.26 and Adjusted net income was $33.0 million with Adjusted diluted income per share of $0.28. The fourth quarter and year-end results included the impact of a non-cash impairment charge of $65 million on our investment in the Zeolyst Joint Venture, reducing the carrying value of our investment to its estimated fair value, primarily due to the demand outlook for catalyst materials used in emission control applications and the production of sustainable fuels. In May of 2016, as a result of a business combination, the investment in the Zeolyst Joint Venture was increased through purchase accounting fair value adjustments. This impairment was a partial reduction to the goodwill and trade name components of the purchase accounting fair value adjustments recorded as a result of the 2016 business combination. Adjusted EBITDA was $75.9 million, up 8.7% compared to the fourth quarter of 2023, with an Adjusted EBITDA margin of 35.3%.

Ecoservices

Fourth quarter 2024 sales for Ecoservices were $148.9 million, compared to $141.4 million in the fourth quarter of 2023. The increase in sales was primarily driven by higher sales volume and favorable contract pricing for regeneration services. Adjusted EBITDA was $54.0 million, compared to $48.4 million in the fourth quarter of 2023. The increase reflects the higher sales volume and favorable contract pricing, lower turnaround costs and favorable absorption of fixed costs, partially offset by higher manufacturing and transportation costs driven by inflation.

For the year, sales were $598.3 million, compared to $584.8 million in 2023. The increase was driven by higher sales volume, for virgin sulfuric acid and regeneration services, and favorable contract pricing for regeneration services. The sales contribution was partially offset by lower average selling prices driven by the pass-through of lower costs, including lower sulfur costs of approximately $7 million. Adjusted EBITDA was $200.3 million, compared to $200.0 million in 2023, with the benefit of higher sales volume and favorable contract pricing largely offset by higher transportation costs and planned maintenance costs, inclusive of turnarounds, as well as unfavorable net pricing, reflecting the timing and contractual pass-through of certain costs, including energy and other indexed costs.

Advanced Materials & Catalysts

During the fourth quarter of 2024, Advanced Silicas sales were $33.1 million, up $1.7 million compared to the year-ago quarter, driven primarily by higher sales of advanced silicas used for the production of polyethylene. Our proportionate 50% share of sales for the Zeolyst Joint Venture sales was $33.1 million, compared to $52.8 million in the prior-year quarter, primarily reflecting the timing of hydrocracking catalyst sales. Fourth quarter of 2024 Adjusted EBITDA for Advanced Materials & Catalysts, which includes the 50% proportionate share of the Zeolyst Joint Venture, was $27.9 million up $0.7 million compared to the year-ago quarter, with the increase reflecting higher sales volume in Advanced Silicas, favorable absorption of fixed costs and cost savings within the Zeolyst Joint Venture, largely offset by lower sales within the Zeolyst Joint Venture.

For the year, Advanced Silicas sales were $106.2 million, compared to $106.3 million in 2023. The change reflects higher sales for finished polyethylene catalysts and niche custom catalysts, offset by lower sales of polyethylene catalyst supports. Our proportionate 50% share of Zeolyst Joint Venture sales was $116.5 million, compared to $156.5 million in the prior year. The decrease reflects lower sales for hydrocracking and emission control catalysts and lower sales of catalysts used in the production of sustainable fuels. Adjusted EBITDA for Advanced Materials & Catalysts of $64.7 million was down 21.0%, with the decrease primarily due to lower sales volume within the Zeolyst Joint Venture.

Cash Flows and Balance Sheet

Cash flows from operating activities was $149.9 million for the year ended December 31, 2024, compared to $137.6 million for the year ended December 31, 2023. The increase reflects higher dividends from the Zeolyst Joint Venture partially offset by lower earnings, higher cash taxes and unfavorable changes in working capital. At December 31, 2024, the Company had cash and cash equivalents of $146.0 million, total gross debt of $870.8 million and availability under the ABL facility of $75.2 million, after giving effect to $3.3 million of outstanding letters of credit and no outstanding borrowings under the facility, for total available liquidity of $221.2 million. In light of the net loss reported for the twelve months ended December 31, 2024, calculation of a net debt to net income ratio is not meaningful, and the net debt leverage ratio was 3.0x.

2025 Financial Outlook

We remain cautious about the near-term outlook for global macroeconomic activity. However, we expect demand for our regeneration services business will remain positive in 2025, and we expect favorable demand for virgin sulfuric acid sales into mining and industrial applications and continued demand growth in catalyst activation for Chem32. While our longer-term outlook for polyethylene catalyst sales remains positive, supported by customer commitments for the ongoing expansion of polyethylene production capacity at our Kansas City site, the near-term demand outlook remains uncertain due to softer global demand projections. Within the Zeolyst Joint Venture, we expect sales of hydrocracking catalysts to increase moderately as we continue to capitalize on the enthusiasm for our MACH offering. We believe we remain well positioned to address growth opportunities as they arise in 2025 and we plan to continue to advance our technology offerings to position Ecovyst to serve the growth potential presented by advanced plastics recycling, bio-catalysis, carbon capture and sustainable aviation fuel.

The Company's guidance for full year 2025 is as follows:

   -- Sales of $755 million to $815 million1 
 
   -- Sales of $115 million to $130 million for proportionate 50% share of 
      Zeolyst Joint Venture, which is excluded from GAAP Sales 
 
   -- Adjusted EBITDA2 of $238 million to $258 million 
 
   -- Adjusted Free Cash Flow2 of $60 million to $80 million 
 
   -- Capital expenditures of $80 million to $90 million 
 
   -- Interest expense of $47 million to $53 million 
 
   -- Depreciation & Amortization 
 
          -- Ecovyst - $87 million to $93 million 
 
          -- Zeolyst J.V. - $12 million to $14 million 
 
   -- Effective tax rate in the mid 20% range 
 
   -- Adjusted Net Income2 of $58 million to $85 million, with Adjusted Diluted 
      Income2 per share of $0.50 to $0.70 
 
(1)  Sales outlook for 2025 assumes higher average sulfur prices compared to 
     2024 and higher projected pass-through of sulfur costs of approximately 
     $35 million. 
(2)  In reliance upon the unreasonable efforts exemption provided under Item 
     10(e)(1)(i)(B) of Regulation S-K, the Company is not able to provide a 
     reconciliation of its non-GAAP financial guidance to the corresponding 
     GAAP measures without unreasonable effort because of the inherent 
     difficulty in forecasting and quantifying certain amounts necessary for 
     such a reconciliation such as certain non-cash, nonrecurring or other 
     items that are included in net income and net cash provided by operating 
     activities as well as the related tax impacts of these items and asset 
     dispositions / acquisitions and changes in foreign currency exchange 
     rates that are included in cash flow, due to the uncertainty and 
     variability of the nature and amount of these future charges and costs. 
     Because this information is uncertain, the Company is unable to address 
     the probable significance of the unavailable information, which could be 
     material to future results. 
 

In December 2024, the Company announced that its Board of Directors has launched a strategic review of our Advanced Materials & Catalysts segment with the goal of maximizing long-term stockholder value. The review remains underway and the Company expects to complete it in mid-2025. The strategic review process is subject to unknown variables including the costs, structure, terms and timing thereof, and the strategic review process may not result in any transaction or other outcome. The Company does not intend to make any further public comment regarding the strategic review until it has been completed or the Company determines that disclosure is required or beneficial.

Stock Repurchase Authorization

In April 2022, the Company's Board of Directors approved a stock repurchase program authorizing the repurchase of up to $450 million of the Company's outstanding common stock over the next four years. As of December 31, 2024, $229.6 million was available for share repurchases under the program.

During the quarter ended December 31, 2024 the Company did not repurchase any of its common stock. During the year ended December 31, 2024, the Company repurchased 552,081 shares of its common stock on the open market at an average price of $9.05 per share, for a total cost of $5.0 million, excluding brokerage commissions and accrued excise tax.

For possible future repurchases, the actual timing, number, and nature of shares repurchased will depend on a variety of factors, including stock price, trading volume, and general business and market conditions and may be conducted through negotiated transactions, open market repurchases or other means, including through Rule 10b-18 trading plans or accelerated share repurchases. The repurchase program does not obligate the Company to acquire any number of shares in any specific period, or at all, and the repurchase program may be amended, suspended or discontinued at any time at the Company's discretion.

Conference Call and Webcast Details

On Thursday, February 27, 2025, Ecovyst management will review the fourth quarter results during a conference call and audio-only webcast scheduled for 11:00 a.m. Eastern Time.

Conference Call: Investors may listen to the conference call live via telephone by dialing 1 (800) 267-6316 (domestic) or 1 (203) 518-9783 (international) and use the participant code ECVTQ424.

Webcast: An audio-only live webcast of the conference call and presentation materials can be accessed at https://investor.ecovyst.com. A replay of the conference call/webcast will be made available at https://investor.ecovyst.com/events-presentations.

Investor Contact:

Gene Shiels

(484) 617-1225

gene.shiels@ecovyst.com

About Ecovyst Inc.

Ecovyst Inc. and subsidiaries is a leading integrated and innovative global provider of advanced materials, specialty catalysts and services. We support customers globally through our strategically located network of manufacturing facilities. We believe that our products and services contribute to improving the sustainability of the environment.

We have two uniquely positioned specialty businesses: Ecoservices provides sulfuric acid recycling to the North American refining industry for the production of alkylate and provides high quality and high strength virgin sulfuric acid for industrial and mining applications. Ecoservices also provides chemical waste handling and treatment services, as well as ex-situ catalyst activation services for the refining and petrochemical industry. Advanced Materials & Catalysts, through its Advanced Silicas business, provides finished silica catalysts, catalyst supports and functionalized silicas necessary to produce high performing plastics and to enable sustainable chemistry, and through its Zeolyst Joint Venture, innovates and supplies specialty zeolites used in catalysts that support the production of sustainable fuels, remove nitrogen oxides from diesel engine emissions and that are broadly applied in refining and petrochemical process. For more information, see our website at https://www.ecovyst.com.

Presentation of Non-GAAP Financial Measures

In addition to the results provided in accordance with U.S. generally accepted accounting principles ("GAAP") throughout this press release, the Company has provided non-GAAP financial measures -- Adjusted EBITDA, Adjusted EBITDA margin, Adjusted net income, Free Cash Flow, Adjusted Free Cash Flow, Adjusted diluted income per share, net debt to net income ratio and net debt leverage ratio (collectively, "Non-GAAP Financial Measures") -- which present results on a basis adjusted for certain items. The Company uses these Non-GAAP Financial Measures for business planning purposes and in measuring its performance relative to that of its competitors. The Company believes that these Non-GAAP Financial Measures are useful financial metrics to assess its operating performance from period-to-period by excluding certain items that the Company believes are not representative of its core business. These Non-GAAP Financial Measures are not intended to replace, and should not be considered superior to, the presentation of the Company's financial results in accordance with GAAP. The use of the Non-GAAP Financial Measures terms may differ from similar measures reported by other companies and may not be comparable to other similarly titled measures. These Non-GAAP Financial Measures are reconciled from the respective measures under GAAP in the attached appendix.

Zeolyst Joint Venture

The Company's zeolite catalysts product group operates through its Zeolyst Joint Venture, which is accounted for as an equity method investment in accordance with GAAP. The presentation of the Zeolyst Joint Venture's sales represents 50% of the sales of the Zeolyst Joint Venture. The Company does not record its proportionate share of sales from the Zeolyst Joint Venture accounted for using the equity method as revenue and such sales are not consolidated within its results of operations. However, Adjusted EBITDA for the Company's Advanced Materials & Catalysts segment reflects the Company's 50% portion of the earnings from the Zeolyst Joint Venture that have been recorded as equity in net income in the Company's consolidated statements of income for such periods and includes Zeolyst Joint Venture adjustments on a proportionate basis based on the Company's 50% ownership interest. Accordingly, the Company's Adjusted EBITDA margins are calculated including 50% of the sales of the Zeolyst Joint Venture for the relevant periods in the denominator.

Note on Forward-Looking Statements

Some of the information contained in this press release constitutes "forward-looking statements." Forward-looking statements can be identified by words such as "anticipates," "intends," "plans," "seeks," "believes," "estimates," "expects," "projects" and similar references to future periods. Forward-looking statements are based on our current expectations and assumptions regarding our business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Examples of forward-looking statements include, but are not limited to, statements regarding our future results of operations, financial condition, capital expenditure projects, liquidity, prospects, growth, strategies, capital allocation program (including the stock repurchase program), product and service offerings, expected demand trends, the timing and outcome, if any, of the Company's strategic review process for its Advanced Materials & Catalysts segment and our 2025 financial outlook. Our actual results may differ materially from those contemplated by the forward-looking statements. We caution you, therefore, against relying on any of these forward-looking statements. They are neither statements of historical fact nor guarantees or assurances of future performance. Important factors that could cause actual results to

differ materially from those in the forward-looking statements include, but are not limited to, regional, national or global political, economic, business, competitive, market and regulatory conditions, including tariffs and trade disputes, currency exchange rates, the effects of inflation and other factors, including those described in the sections titled "Risk Factors" and "Management's Discussion & Analysis of Financial Condition and Results of Operations" in our filings with the SEC, which are available on the SEC's website at www.sec.gov. These forward-looking statements speak only as of the date of this release. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by applicable law.

 
                              ECOVYST INC. AND SUBSIDIARIES 
                         CONSOLIDATED STATEMENTS OF (LOSS) INCOME 
                     (in millions, except share and per share amounts) 
                     Three months ended                      Years ended 
                        December 31,            %            December 31,            % 
                  ------------------------             ------------------------ 
                     2024         2023       Change       2024         2023       Change 
                  -----------  -----------  ---------  -----------  -----------  --------- 
 
Sales                $  182.0     $  172.8      5.3 %     $  704.5     $  691.1      1.9 % 
Cost of goods 
 sold                   128.1        125.5      2.1 %        503.0        493.2      2.0 % 
                  -----------  -----------  ---------  -----------  -----------  --------- 
 Gross profit            53.9         47.3     14.0 %        201.5        197.9      1.8 % 
Selling, general 
 and 
 administrative 
 expenses                19.6         19.7    (0.5) %         83.9         79.2      5.9 % 
Other operating 
 expense, net             9.7          4.8    102.1 %         19.6         22.0   (10.9) % 
                  -----------  -----------  ---------  -----------  -----------  --------- 
 Operating 
  income                 24.6         22.8      7.9 %         98.0         96.7      1.3 % 
Equity in net 
 (income) from 
 affiliated 
 companies             (12.6)       (14.3)   (11.9) %       (15.1)       (30.6)   (50.7) % 
Impairment of 
 investment in 
 affiliated 
 companies               65.0           --         NM         65.0           --         NM 
Interest 
 expense, net            11.8         13.9   (15.1) %         49.4         44.7     10.5 % 
Debt 
extinguishment 
costs                      --           --       -- %          4.6           --         NM 
Other (income) 
 expense, net           (1.9)           --         NM        (0.8)          0.6  (233.3) % 
                  -----------  -----------  ---------  -----------  -----------  --------- 
 (Loss) income 
  before income 
  taxes                (37.7)         23.2  (262.5) %        (5.1)         82.0  (106.2) % 
(Benefit) 
 provision for 
 income taxes           (7.2)        (6.8)      5.9 %          1.6         10.8   (85.2) % 
Effective tax 
 rate                  19.1 %     (29.3) %                (32.5) %       13.2 % 
Net (loss) 
 income             $  (30.5)    $    30.0  (201.7) %   $    (6.7)    $    71.2  (109.4) % 
 
Earnings per 
share: 
 Basic (loss) 
  earnings per 
  share             $  (0.26)    $    0.26               $  (0.06)    $    0.60 
 Diluted (loss) 
  earnings per 
  share             $  (0.26)    $    0.26               $  (0.06)    $    0.60 
 
Weighted 
average shares 
outstanding: 
 Basic            116,518,933  116,116,895             116,719,437  118,367,214 
 Diluted          116,518,933  117,190,747             116,719,437  119,487,709 
 
 
 
                       ECOVYST INC. AND SUBSIDIARIES 
                         CONSOLIDATED BALANCE SHEETS 
              (in millions, except share and per share amounts) 
                                                 December 31, 
                                  ------------------------------------------ 
                                          2024                  2023 
                                  --------------------  -------------------- 
ASSETS 
Cash and cash equivalents           $            146.0   $              88.4 
Accounts receivable, net                          77.9                  81.3 
Inventories, net                                  57.1                  45.1 
Derivative assets                                  6.5                  13.4 
Prepaid and other current assets                  16.1                  17.8 
                                  --------------------  -------------------- 
   Total current assets                          303.6                 246.0 
                                  --------------------  -------------------- 
Investments in affiliated 
 companies                                       349.3                 440.2 
Property, plant and equipment, 
 net                                             569.3                 576.9 
Goodwill                                         404.1                 404.5 
Other intangible assets, net                      98.4                 116.6 
Right-of-use lease assets                         33.6                  24.3 
Other long-term assets                            44.0                  29.3 
                                  --------------------  -------------------- 
   Total assets                      $         1,802.3     $         1,837.8 
                                  ====================  ==================== 
LIABILITIES 
Current maturities of long-term 
 debt                             $                8.7  $                9.0 
Accounts payable                                  43.9                  40.2 
Operating lease 
 liabilities--current                              9.3                   8.2 
Accrued liabilities                               53.2                  61.7 
                                  --------------------  -------------------- 
   Total current liabilities                     115.1                 119.1 
                                  --------------------  -------------------- 
Long-term debt, excluding 
 current portion                                 852.1                 858.9 
Deferred income taxes                            105.4                 115.8 
Operating lease 
 liabilities--noncurrent                          24.2                  16.0 
Other long-term liabilities                        5.0                  22.5 
                                  --------------------  -------------------- 
   Total liabilities                           1,101.8               1,132.3 
                                  --------------------  -------------------- 
Commitments and contingencies 
EQUITY 
Common stock ($0.01 par); 
 authorized shares 450,000,000; 
 issued shares 140,872,846 and 
 140,774,045 on December 31, 
 2024 and 2023, respectively; 
 outstanding shares 116,534,803 
 and 116,116,895 on December 31, 
 2024 and 2023, respectively                       1.4                   1.4 
Preferred stock ($0.01 par); 
authorized shares 50,000,000; no 
shares issued or outstanding on 
December 31, 2024 and 2023, 
respectively                                        --                    -- 
Additional paid-in capital                     1,106.8               1,102.6 
Accumulated deficit                            (177.5)               (170.9) 
Treasury stock, at cost; shares 
 24,338,043 and 24,627,150 on 
 December 31, 2024 and 2023, 
 respectively                                  (222.8)               (226.7) 
Accumulated other comprehensive 
 loss                                            (7.4)                 (0.9) 
                                  --------------------  -------------------- 
 Total equity                                    700.5                 705.5 
                                  --------------------  -------------------- 
 Total liabilities and equity        $         1,802.3     $         1,837.8 
                                  ====================  ==================== 
 
 
                      ECOVYST INC. AND SUBSIDIARIES 
                   CONSOLIDATED STATEMENTS OF CASH FLOWS 
                                         Years ended December 31, 
                                 ----------------------------------------- 
                                         2024                 2023 
                                 --------------------  ------------------- 
Cash flows from operating 
activities:                                    (in millions) 
   Net (loss) income             $              (6.7)  $              71.2 
   Adjustments to reconcile 
   net (loss) income to net 
   cash provided by operating 
   activities: 
      Depreciation                               75.3                 70.6 
      Amortization                               14.1                 14.0 
      Intangible asset 
      impairment charge                           3.9                   -- 
      Amortization of deferred 
       financing costs and 
       original issue discount                    1.7                  2.1 
      Debt extinguishment 
      costs                                       0.1                   -- 
     Foreign currency exchange 
      loss (gain)                                 0.3                (0.6) 
     Deferred income tax 
      benefit                                   (7.9)               (17.1) 
     Net loss on asset 
      disposals                                   2.4                  4.1 
     Stock compensation                          14.0                 16.0 
     Equity in net (income) 
      from affiliated 
      companies                                (15.1)               (30.6) 
     Dividends received from 

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