1. Ecovyst reported $182 million in Q4 2024 sales, up 5% YoY. 2. Adjusted EBITDA increased 8.7% to $75.9 million in Q4 2024. 3. A $65 million impairment affected the Zeolyst Joint Venture investment. 4. The 2025 outlook remains cautious amid soft global demand forecasts. 5. Ongoing expansion in polyethylene catalyst production supports future growth.
While sales and EBITDA improved, the impairment charge dampens immediate investor sentiment. In past cases, significant impairments have led to stock price drops.
The overall performance report, particularly the sales growth and impairment charge, impacts current market perceptions significantly.
Recent performance data will likely influence stock in the immediate future. Long-term risks from the global demand outlook could affect prices subsequently.
("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.
"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.
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%.
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.
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 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.
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.
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.
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
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.
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.
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.