Full-Year EBITDA
Q: Are $300–$350M EBITDA targets valid?
A: Management remains cautious given market uncertainty but is confident that contributions from the $26M licensing deal, $25M SG&A savings, and normalized AmSty earnings will help achieve a full-year target in that range.

Cost Cuts
Q: How are cost‐reductions progressing?
A: They have reduced fixed costs by over $100M in the past two years with incremental SG&A benefits of $25M expected this year, reinforcing a positive margin outlook.

Cash Spend Outlook
Q: Why is 2025 cash spend up at $390M?
A: The higher cash expenditure stems from increased working capital outflows and slightly elevated cash taxes due to higher profitability.

Q1 EBITDA Guidance
Q: Why is Q1 EBITDA lower than usual?
A: Q1 is depressed by a pricing lag—especially in Engineered Materials from higher natural gas costs—but management expects a sequential rebound in Q2.

Licensing Partnership
Q: What are the terms of the Deepak license?
A: The polycarbonate license is perpetual, forming a strategic relationship with India’s Deepak Nitrite to boost domestic market penetration and leverage unique technology.

Natural Gas & Hedging
Q: How do rising European natural gas prices affect guidance?
A: There is a pricing lag in the Engineered Materials segment due to recent natural gas price hikes; short-term hedges—covering less than 50%—are in place to mitigate this impact.

Recycling & CapEx
Q: What is the status of recycled products and future CapEx?
A: Recycled-content products now represent about 4–5% of total volume, growing significantly, with planned modular CapEx investments in the high single to low double-digit millions proving attractive.

AR Securitization
Q: How does the borrowing base work for AR securitization?
A: The facility’s borrowing base is influenced by seasonal receivables, with $125M available (and $75M drawn) expected to improve in Q1 as volumes normalize.

Tariffs Impact
Q: What tariff effects are expected on exports?
A: Tariff impacts are anticipated to be minimal since U.S. production is largely consumed domestically and exports to Mexico and Canada form only a low single-digit percentage of sales.

EM Consumer Electronics
Q: Is the 61% EM volume jump sustainable?
A: The significant growth partly reflects a low base last year and successful diversification into consumer electronics—a trend expected to continue given the resilient demand for recycled products.

Working Capital
Q: Are customers planning to further destock?
A: Management sees balanced value chains, noting that neither significant destocking nor further working capital efficiency initiatives are expected in the near term.

Automotive Compounding
Q: What is the role of automotive in Engineered Materials?
A: Automotive continues to be a significant part of legacy Engineered Materials, although specific compounding contributions were not quantified during the call.

Polystyrene Assets
Q: Are polystyrene assets now core to the company?
A: The company considers these assets non-core and is actively exploring opportunities to sell them as separate investments.

AmSty Sale Process
Q: Is the AmSty sale process on hold?
A: The process is ongoing with a focus on optimizing value; it has not been halted but is intentionally delayed for a better valuation environment.

Styrene Pricing Impact
Q: How are lower styrene prices affecting profitability?
A: Lower styrene costs have a pass-through effect on pricing, and while they created negative timing impacts in Q4, they are expected to benefit margins in Q1.