OLIN Corp (OLN)·Q1 2025 Earnings Summary

Executive Summary

• Q1 2025 was mixed: revenue rose 0.5% YoY to $1.644B while adjusted EBITDA fell 23% YoY to $185.6M; diluted EPS was $0.01, down from $0.40 YoY .
• The quarter beat Street consensus across revenue ($1.644B vs $1.576B*), adjusted EBITDA ($185.6M vs $159.7M*), and EPS ($0.01 vs -$0.10*), driven by stronger CAPV volumes and disciplined pricing, despite Epoxy losses and Winchester headwinds .
• Guidance: Q2 2025 adjusted EBITDA $170–$210M, with CAPV expected “similar” sequentially despite ~$33M higher turnaround expense; Epoxy to remain negative; Winchester to improve seasonally and on military .
• Capital allocation/tone: cost-savings target raised to $50–$70M for 2025, capex cut to $200–$220M, maturities extended (2030 revolver; $600M of 2033 bonds to retire 2025/2027), and $0.20 dividend declared (394th consecutive) .
• Stock reaction catalysts: clearer trajectory on caustic pricing strength, PVC tolling ramp, AMMO asset integration synergies ($10–$15M year-one, $40M run-rate), and execution against cost-down targets .

Note: Values marked with * are retrieved from S&P Global (Capital IQ) consensus.

What Went Well and What Went Wrong

What Went Well

• CAPV outperformed on volumes; Olin delayed a planned Freeport turnaround to serve under-supplied chlorine customers, evidencing operating leverage and value-first execution (“ready to raise operating rates to meet demand at fair values”) .
• Cost discipline stepped up: 2025 cost savings now targeted at $50–$70M (more than double the prior outlook); 2025 capex trimmed by ~$25M, to $200–$220M .
• Strategic actions: debt maturities extended (revolver to 2030; $600M 2033 bonds issued to repay 2025/2027), and AMMO assets closed with expected $10–$15M year-one adjusted EBITDA and $40M full-run synergies; Lake City contract extended to 2030 .

What Went Wrong

• Epoxy losses widened: segment loss ($28.4M) vs ($11.8M) YoY on higher operating costs; global epoxy demand weak and antidumping initiatives only partly helpful .
• Winchester earnings fell sharply YoY ($22.8M vs $72.2M) on lower commercial shipments/pricing and higher raw material costs (propellant/metals), partially offset by stronger military .
• Working capital seasonality weighed on cash from operations (-$86M vs +$81M prior year), and Q2 chemicals face ~$33–$40M sequential turnaround cost headwind .

Financial Results

Consolidated Results (Oldest → Newest)

Segment Sales and Earnings (Oldest → Newest)

KPIs (Oldest → Newest)

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “We now expect to deliver year-over-year cost savings of $50 to $70 million… We have also lowered our annual capital spending estimate by approximately $25 million.” — Ken Lane, CEO .
• “We delayed the planned first quarter outage… to meet customer needs… Olin is ready to raise operating rates to meet demand at fair values.” — Ken Lane .
• “We further enhanced our financial resiliency… bond issuance and debt refinancing… extension… senior credit agreement from 2027 to 2030. We now have no material debt repayments until midyear 2029.” — Todd Slater, CFO .
• “Winchester… acquisition of AMMO Inc.’s assets… immediately accretive… target synergies… less than ~1.5x adjusted EBITDA including synergies.” — Ken Lane ; transaction specifics .
• “Epoxy earnings are expected to be negative [in Q2]… global capacity overhang will continue to be a headwind.” — Ken Lane .

Q&A Highlights

• CAPV outlook: Pricing support into Q2 despite EDC weakness; caustic demand strong across pulp/paper and alumina; turnaround delay adds ~$33M sequential expense but CAPV EBITDA similar in Q2 .
• PVC strategy: Tolling volumes ramping through year; PVC sales are cash-positive, leveraging Olin’s cost position; exploring long-term JV/technology/commercial options .
• Winchester bridge: ~2/3 of YoY decline from volume/price and ~1/3 from higher commodity/propellant costs; expect Q2 sequential improvement (seasonal + military) .
• Epoxy: Tight global overhang; anti-dumping outcomes mixed (Korea lower); Q2 turnaround in Stade (~$10M headwind); improvement more likely late 2025/early 2026 as integration/cost tailwinds kick in .
• Tariffs: Net neutral direct impact overall; metals tariffs inflate Winchester costs; potential caustic import tightening on US coasts; management “cautiously optimistic” on caustic .

Estimates Context

Notes:

• Olin reported diluted EPS of $0.01 for Q1 2025 , while S&P Global tracks Primary EPS (actual $0.03*). Both indicate a beat vs consensus.
• Values marked with * are retrieved from S&P Global (Capital IQ) consensus.

Key Takeaways for Investors

• CAPV resilience is the quarter’s anchor: volumes and ECU values held up, with management signaling caustic strength into Q2; watch spot EDC and turnaround costs (~$33–$40M sequential chemicals headwind) .
• Epoxy is the main drag near-term; expect continued losses in Q2 and only gradual improvement as antidumping and European cost structure changes develop .
• Winchester headwinds persist from commercial destocking and metals costs, but military demand and the AMMO asset integration should lift sequential results and build toward $40M synergy run-rate over time .
• Execution against raised savings ($50–$70M) and trimmed capex ($200–$220M) supports FCF defense in a trough; debt ladder extended (no material maturities until mid-2029) reduces refinancing risk .
• Dividend durability (394th consecutive) and opportunistic buybacks continue within an investment-grade framework; near-term net debt will moderate as working capital unwinds later in 2025 .
• Trading setup: Near-term prints hinge on caustic pricing trends, PVC tolling cadence, and Q2 chemicals turnaround impact; Epoxy headlines around EU/U.S. antidumping determinations and tariff spillovers to metals are secondary stock drivers .
• Medium-term thesis: Value-first commercial approach and adjacency plays (PVC, hydrogen JV, Winchester bolt-ons) can expand normalized earnings power into recovery; monitor policy outcomes and cost-down delivery .