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AdvanSix Inc. (ASIX)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 delivered a clean beat: sales $377.8M (+12% y/y), Adjusted EPS $0.93, Adjusted EBITDA $51.6M with 13.7% margin, aided by improved operations, strong Plant Nutrients pricing, and $26M insurance proceeds . Versus S&P Global consensus, revenue $347.3M* and EPS $0.825* were exceeded, with surprises driven by +7% volume and +4% market pricing, partially offset by higher natural gas and sulfur inputs .
  • Mix tailwinds: Plant Nutrients led with $128.2M (34% of sales), while acetone spreads remained above cycle averages despite y/y pressure; nylon remains in a protracted global downcycle but modestly better domestically .
  • 2025 outlook maintained/tightened: CapEx narrowed to $145–$155M (midpoint unchanged), plant turnaround impact “$25–$30M” reaffirmed; dividend $0.16/share declared for May 27 .
  • Potential stock catalysts: sustained ammonium sulfate (AS) premiums at/near the high end, sequential margin normalization post-4Q turnaround, and any updates on EZ-BLOX patent enforcement in Europe .

Values with an asterisk (*) are from S&P Global.

What Went Well and What Went Wrong

What Went Well

  • Strong beat vs consensus: Revenue $377.8M vs $347.3M* and Adjusted EPS $0.93 vs $0.825*, on +7% volume and +4% market pricing; Adjusted EBITDA margin expanded to 13.7% .
  • Plant Nutrients strength: robust AS premiums drove pricing; management noted “industry corn belt ammonium sulfate prices up 34% y/y and 25% q/q” supporting realized premiums .
  • Operations and one-time recovery: improved utilization after 4Q turnarounds plus $26M PES insurance settlement supported earnings; leadership emphasized operational excellence and closing multiyear recovery efforts .

What Went Wrong

  • Raw material headwinds: higher natural gas and sulfur pressured fertilizer margins despite strong AS pricing .
  • Acetone spreads lower y/y: margin over refinery grade propylene declined y/y amid higher input costs, though still at/above cycle averages .
  • Free cash flow negative: CFO $11.4M and CapEx $34.1M yielded FCF of -$22.6M in Q1 (seasonal working capital and CapEx cadence) .

Financial Results

Consolidated Performance vs Prior Periods

MetricQ3 2024Q4 2024Q1 2025
Sales ($USD Millions)$398.2 $329.1 $377.8
Diluted EPS (GAAP)$0.82 $0.01 $0.86
Adjusted EPS ($)$0.88 $0.09 $0.93
Adjusted EBITDA ($USD Millions)$53.2 $10.2 $51.6
Adjusted EBITDA Margin (%)13.4% 3.1% 13.7%

Sequential rebound from Q4 reflects normalization post-extended Q4 turnaround, stronger AS pricing, and insurance proceeds; partially offset by higher input costs (natural gas, sulfur) .

Q1 2025 vs S&P Global Consensus

MetricConsensusActualSurprise
Revenue ($USD Millions)$347.3M*$377.8M +$30.5M / +8.8%
Primary EPS (Adj)$0.825*$0.93 +$0.105

Values with an asterisk (*) are from S&P Global.

Segment/Product Line Mix (Q1 2025 vs Q1 2024)

Product LineQ1 2025 Sales ($M)Q1 2025 % of TotalQ1 2024 Sales ($M)Q1 2024 % of Total
Nylon$88.4 23% $84.4 25%
Caprolactam$67.4 18% $61.5 18%
Plant Nutrients$128.2 34% $94.7 28%
Chemical Intermediates$93.8 25% $96.3 29%
Total$377.8 100% $336.8 100%

Cash Flow & Investment KPIs

KPIQ3 2024Q4 2024Q1 2025
Cash Flow from Operations ($M)$57.3 $64.2 $11.4
Capital Expenditures ($M)$30.5 $34.3 $34.1
Free Cash Flow ($M)$26.8 $29.8 -$22.6

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Capital ExpendituresFY 2025$140–$160M (Feb 21, 2025) $145–$155M (May 2, 2025) Tightened range; midpoint maintained
Plant Turnaround Impact (Pre-tax)FY 2025$25–$30M $25–$30M Maintained
DividendQuarterly$0.16/share (declared Mar 24 pay date) $0.16/share (May 27 pay date) Maintained (new record/pay dates)
Plant Nutrients (AS premiums)2025Premiums at/near high end of historical range Premiums at/near high end; higher raw materials to weigh on margins Qualitative reaffirmation; margin caution
Acetone spreads2025Above cycle averages Lower y/y (higher inputs) but at/above cycle averages Qualitative: y/y lower
Nylon cycle2025Slower recovery off trough; stable end markets Navigating more protracted downturn; modest U.S. improvement Narrative evolution

Earnings Call Themes & Trends

TopicQ3 2024 (Q-2)Q4 2024 (Q-1)Q1 2025 (Current)Trend
Plant Nutrients (AS)Strong fall fill; pricing up y/y Strong premiums expected; supportive demand Corn belt AS +34% y/y, +25% q/q; premiums robust; higher gas/sulfur a headwind Positive pricing; margin headwinds
Acetone spreadsConstructive environment Above cycle averages expected Lower y/y on input costs; still at/above cycle averages Slight deterioration vs y/y, still healthy
NylonModest improvement in NA spreads Slower recovery off trough; more domestic competition Protracted global oversupply; U.S. modestly better; monitoring tariffs/auto Mixed; global pressure persists
Raw materials——Sulfur/natural gas inflation pressuring margins Cost headwind
CapEx/SUSTAINCapEx $135–$140M for 2024; USDA $12M grant for granular AS 2025 CapEx $140–$160M Tightened to $145–$155M; peak 2025/26 then moderating Elevated near term; declines afterward
Regulatory/legal—45Q credits claimed $9.7M (ETR benefit) Additional $1.8M 45Q tax credits benefitted ETR; EZ-BLOX patent enforcement in Europe ongoing Supportive ETR; potential legal upside

Management Commentary

  • “Our significantly improved first quarter results... and drove the successful conclusion of our multi-year efforts to recover losses associated with the 2019 PES cumene supplier shutdown” — Erin Kane, CEO .
  • “Adjusted EBITDA was $52M and adjusted EBITDA margin was 13.7%… effective tax rate was 19.3%… CFO $11M… CapEx $34M” — CFO Sid Manjeshwar .
  • “Industry corn belt ammonium sulfate prices were up 34% year-over-year and 25% sequentially… supporting continued healthy realized sulfur premiums” — CEO .
  • “Acetone prices over propylene costs declined… but remain at or above cycle averages” — CEO .
  • “We’ve tightened our overall CapEx forecast for 2025 to $145–$155M… focused on generating positive free cash flow for the year” — CFO .

Q&A Highlights

  • Inventory and liquidity playbook: Management is not using inventory buffers now; leverage ~1x with ample liquidity; focus on cash flow, working capital turns, and cost control .
  • Sulfur supply: Broad vendor base; supply-demand viewed as more balanced than price implies; expect sulfur to come down; supply ample for needs .
  • AS post-spring strategy: Prioritize domestic granular sales; exports are reducing over time as domestic demand grows; record fertilizer-year volume expected .
  • Nylon and tariffs: Global oversupply persists; domestic demand stable; Nylon 6 currently excluded from retaliatory tariff list; exports roughly consistent with historical averages .
  • EZ-BLOX patent: European patent granted; actions underway to protect exclusivity and seek damages; aim for permanent injunction against infringing 2-PO sales .
  • CapEx peak and M&A optionality: Base CapEx to moderate after 2025; evaluating inorganic opportunities as conditions evolve .

Estimates Context

  • Q1 2025 actuals beat S&P Global consensus on both revenue ($377.8M vs $347.3M*) and EPS ($0.93 vs $0.825*). Q4 2024 also beat on EPS ($0.09 vs -$0.365*) despite lower revenue, aided by turnaround timing and 45Q tax credits .
  • With management reiterating elevated AS premiums and normalization post-turnarounds, Street models may need to reflect stronger near-term Plant Nutrients pricing and volume, partially offset by higher natural gas/sulfur and lower y/y acetone spreads .

Values with an asterisk (*) are from S&P Global.

S&P Global Consensus Snapshot (for context)

MetricQ3 2024Q4 2024Q1 2025
Revenue Consensus Mean ($M)357.65*377.15*347.25*
Primary EPS Consensus Mean ($)0.655*-0.365*0.825*

Values with an asterisk (*) are from S&P Global.

Key Takeaways for Investors

  • Q1 quality beat with broad-based operational recovery and strong Plant Nutrients pricing; Adjusted EBITDA margin back to mid-teens (13.7%) .
  • Near-term setup supported by AS premiums at/near high-end of historical range, though fertilizer margins face higher natural gas/sulfur costs .
  • Chemical Intermediates steady: acetone spreads at/above cycle averages despite y/y compression; watch propylene costs .
  • Nylon remains cyclical and globally oversupplied; domestic conditions modestly improved; tariff dynamics a swing factor to monitor .
  • 2025 CapEx range narrowed to $145–$155M; peak spend in 2025/26 before moderating, with emphasis on SUSTAIN growth and enterprise risk mitigation .
  • Balance sheet/liquidity healthy (~1x leverage per management) enabling optionality; dividend maintained at $0.16/share .
  • Watch catalysts: sustained AS premiums into Q2, any moderation in sulfur prices, acetone spread stability, and progress on EZ-BLOX enforcement in Europe .