Christopher Perrella • UBS Group AG

Answer

CFO Jeff Gleich explained that the H2 earnings outlook is supported by the normalization of a $5 million inventory revaluation from Q2 and the ongoing benefits of cost-saving actions, rather than a significant step-up in volume. Regarding cash flow, Gleich highlighted planned inventory reductions, particularly in Q4, and new initiatives to optimize accounts payable as key levers to meet the company's target.

Ask Fintool Equity Research AI

Answer

President, CEO & Director Sean Keohane responded that based on tire maker commentary, inventories appear largely in balance, with any elevation in budget brands expected to normalize soon. He reiterated that any demand impact from tariffs would likely be seen later in the year and into 2026. Regarding potential Brazilian duties, Keohane explained that global customers would likely rebalance their production networks to other cost-effective locations like Mexico to supply the U.S. market.

Ask Fintool Equity Research AI

Answer

CEO Sean Keohane explained that base prices in the calendar 2025 agreements were relatively flat year-over-year. He noted that while volumes increased in Europe due to sanctions on Russian supply, this was offset by challenges in the Americas from Asian tire imports. Regarding the Indonesia plant, Keohane projected a very modest EBIT contribution in the second half of fiscal 2025 due to startup costs and customer qualifications, with a significant ramp-up expected in fiscal 2026.

Ask Fintool Equity Research AI

Answer

CFO Neal Sheorey explained that the second-half margin profile is affected by sales mix, with a higher proportion of spot-priced sales expected in Q3 and stronger contract demand in Q4. He confirmed that the impact of higher-cost inventory will be felt more significantly in the third quarter.

Ask Fintool Equity Research AI

Answer

CEO Kent Masters explained that the contract mix won't change materially, but new growth volumes will likely be priced at spot or under contracts without significant price floors. CFO Neal Sheorey detailed the Q4 cash use, citing three main factors: an expected zero dividend from the Talison JV (versus ~$70-80M received in Q3), the timing of accounts payable shifting from Q3 to Q4, and cash outflows of ~$40-50M for restructuring.

Ask Fintool Equity Research AI

Answer

CFO Agustin Izquierdo reiterated the company's disciplined approach, noting the 2025 CapEx guidance was lowered to $1.8 billion. He stated that maintenance CapEx is around $1.2 billion, with the remainder prioritized for key growth projects like Flex 2 and MoReTec 1. He assured that future spending will be moderated based on market conditions, with no meaningful increases expected if the market does not recover.

Ask Fintool Equity Research AI

Answer

CEO Peter Vanacker explained that Q1 starts from a low base due to Q4's high costs but should see a seasonal demand uptick. However, he cautioned that Q1 EBITDA will be significantly impacted by a large, $190 million turnaround at the Channelview facility and downtime from Winter Storm Enzo. EVP Kimberly Foley added that the turnaround's high cost is due to its comprehensive nature, affecting olefins, metathesis, and C4 processing units.

Ask Fintool Equity Research AI

Answer

Chair and CEO James Fitterling cited pricing pressure and high energy costs as Q1 headwinds. COO Karen S. Carter added that while the polyurethanes macro remains challenging, there are pockets of stability in Industrial Solutions (energy, pharma) and growth from a new alkoxylation unit, which is 50% contracted. Fitterling confirmed the European polyurethanes review will conclude by quarter-end.

Ask Fintool Equity Research AI

Answer

CFO Kyle Sable explained that the higher capital expenditures are predominantly directed towards the Fire Safety platform for projects with attractive IRRs that enhance customer mission fulfillment. Regarding leverage, Sable confirmed a desire to return to a higher ratio, similar to IPO levels, driven primarily by M&A. He clarified that the M&A search is broad, not limited to PCBs, seeking high-quality businesses where Perimeter's operational value drivers can be applied.

Ask Fintool Equity Research AI

Answer

CEO Kenneth Lane explained that passing through costs is challenging while retailers are destocking and will take more time. He expects Winchester's performance to improve in the second half of the year, driven by a combination of inventory replenishment and, hopefully, a recovery in consumer demand.

Ask Fintool Equity Research AI