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DATE

Thursday, August 7, 2025, at 11 a.m. ET

CALL PARTICIPANTS

  • Chief Executive Officer — Kurt Bitting
  • Chief Financial Officer — Mike Feehan

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TAKEAWAYS

  • Ecoservices Sales-- $176 million for Q2 2025, representing a $22 million increase compared to Q2 2024, driven primarily by a $20 million pass-through of higher sulfur costs, positive pricing, and initial Wagaman site contribution.
  • Adjusted EBITDA-- Just under $56 million in adjusted EBITDA for Q2 2025, which exceeded the high end of guidance (non-GAAP).
  • Share Repurchases-- 2,900,000 shares repurchased for roughly $22 million.
  • Wagaman Acquisition-- Closed the $41 million purchase of Cornerstone Chemical’s Wagaman sulfuric acid assets, with integration ongoing and synergies expected after 2025.
  • Advanced Silicas Sales-- $24 million compared to $29 million in Q2 2024, attributed to reduced event-driven custom catalyst volume.
  • Zeolyst Joint Venture-- 50% share of sales was $28 million, down slightly from $29 million in Q2 2024, with lower hydrocracking and custom catalyst sales offset by sustainable fuels catalysts.
  • Consolidated Adjusted EBITDA Guidance-- Adjusted EBITDA guidance range narrowed to $242 million to $254 million for 2025, maintaining the midpoint from prior guidance.
  • Adjusted Free Cash Flow Guidance-- Range increased and narrowed to $70 million to $80 million for 2025, with the midpoint raised by $5 million to $75 million.
  • Consolidated Sales Guidance-- Raised to $795 million to $835 million for 2025, reflecting the Wagaman asset acquisition, with partial offset from reduced polyethylene catalyst sales expectations.
  • Leverage Ratio-- Increased to 3.5 times due to the Wagaman acquisition and share repurchases, compared to 3.2 times at the end of the prior quarter; projected to return to approximately three times leverage by year-end 2025.
  • Cash Position and Liquidity-- Cash on hand was $69 million at quarter-end (down from $128 million as of March 31, 2025), with total liquidity, including ABL facility access, at $152 million.
  • Polyethylene Catalyst Sales Outlook-- Polyethylene catalyst sales expected to grow year-over-year in 2025 compared to 2024, though now anticipated to be lower than previously forecast, offset by strength in hydrocracking catalyst demand.
  • Zeolyst Joint Venture Full-Year Guidance-- 50% share of sales forecast increased to $125 million to $140 million for 2025.

SUMMARY

Ecovyst (ECVT -2.27%) management emphasized integration of the Wagaman acquisition as a strategic priority, with cost headwinds in 2025 expected to transition to positive earnings and free cash flow contribution in 2026. New guidance reinforced management’s outlook for stable demand fundamentals in key end-uses for the remainder of the year, with positive momentum in mining sector demand and robust hydrocracking catalyst sales. Commentary regarding renewable diesel highlighted management’s expectation of higher utilization rates in 2026, resulting from the proposed 67% increase in RVO targets compared to 2025, anticipating subsequent benefits to catalyst sales over the medium term.

  • CEO Bitting stated, "We anticipate providing additional updates [on the Advanced Materials and Catalysts segment strategic review] in the near future," confirming continued progress but no near-term resolution.
  • Management explicitly highlighted potential areas of softer demand in advanced materials for polyethylene and sulfuric acid sales into nylon markets, though overall segment forecasts were maintained.
  • Integration and upgrade costs related to Wagaman are expected to offset most near-term sales contribution in 2025, per direct CFO guidance.
  • Interest expense guidance was revised lower, now expected in the $46 million to $50 million range for 2025.

INDUSTRY GLOSSARY

  • RVO (Renewable Volume Obligation): Mandated targets by the U.S. EPA specifying required renewable fuel volumes under the Renewable Fuel Standard, impacting demand for catalysts in sustainable fuel production.
  • ABL Facility (Asset-Based Lending Facility): A credit facility extended based on the value of company assets, utilized for liquidity management.

Full Conference Call Transcript

Kurt Bitting: Thank you, Gene, and good morning. 2025 was another quarter of solid performance for Ecovyst Inc. We achieved our financial objectives and delivered on key initiatives that position us for future growth and unlock value for our stockholders. During the quarter, demand fundamentals across the majority of the end uses we serve remained stable. Ecoservices sales were up 14% compared to 2024, with favorable pricing and the addition of the Wagaman site contributing to the increase. Results for our Advanced Materials and Catalyst segment came in favorable to our expectations and our guidance range, reflecting favorable sales timing and mix.

In terms of strategic objectives, during the quarter, we closed the acquisition of the sulfuric acid production assets of Cornerstone Chemical Company. Integration of the Wagaman, Louisiana site is ongoing, and we expect to realize meaningful synergies and benefits upon full integration of the site into our existing network. The Wagaman site positions us well to meet the growth needs of our customers, and I want to publicly welcome the enthusiastic and engaged Wagaman team to Ecovyst Inc. Additionally, with our focus on delivering value for our stockholders, during the second quarter, we also repurchased 2,900,000 shares of our common stock, totaling approximately $22 million.

As is our usual practice, on Slide six, we provide our latest views on demand trends and our short and longer-term outlook. As I noted earlier, demand fundamentals over the course of the second quarter were stable, and we continue to expect relative stability over the balance of the year. For Ecoservices, high refinery utilization and positive alkaline economics continue to underpin demand for our regeneration services business. We believe the outlook for virgin sulfuric acid demand also remains positive. We continue to expect a stronger second half for sales into the nylon end use, and we expect second half sales into the mining sector to benefit as expansion projects come online.

For Advanced Silicas business, while there is some uncertainty regarding the effects of ongoing global macroeconomic challenges on the demand for polyethylene, we expect that our sales of polyethylene catalysts will increase this year compared to 2024. We also look forward to the completion of the Kansas City expansion project later this year. This expansion will support growth in customer demand as their expansion projects come online in 2026 and 2027. In addition, as we look to emerging technologies to provide meaningful growth opportunities, such as advanced silicas for biocatalysis and carbon capture applications, customer engagement remained high. With a number of trial programs underway, we expect these to translate into further sales growth in 2026.

Within the Zeolyst joint venture, current orders indicate that 2025 is projected to be a strong year for hydrocracking catalyst sales. We anticipate that sales of hydrocracking catalysts will surpass 2024 levels. Regarding our catalyst technologies utilized in the production of sustainable fuels, we anticipate that sales this year will remain in line with the prior year or show a slight increase. However, the longer-term outlook is encouraging. The recently proposed RVO targets are expected to increase renewable diesel consumption in the United States from 3.3 billion gallons in 2025 to 5.6 billion gallons in 2026. Achieving the proposed 67% increase in renewable diesel usage will require the industry to operate at high utilization rates.

We project that future growth in our sustainable fuels catalyst materials will be driven by increased utilization of existing capacity, new capacity expansions, and the continual replacement cycle for catalyst materials. With our advanced catalyst technologies, we believe we are well-positioned to support the rising demand for both renewable diesel and sustainable aviation fuel. I'll now turn the call over to Mike, who will review our second quarter results in more detail.

Mike Feehan: Thank you, Kurt. Good morning. As a follow-up to our stronger than anticipated results in the first quarter, we exceeded our financial targets for the second quarter, providing strong momentum as we move into the second half of the year. Our second quarter adjusted EBITDA was just under $56 million, coming in above the high end of our guidance range. Although unplanned and extended customer outages in the second quarter adversely affected sales volume for regeneration services, Ecoservices landed within the midpoint of our segment guidance range. For our Advanced Materials and Catalyst segment, favorable sales timing and mix helped drive more favorable results in the quarter compared to our initial guidance.

As we look to Slide nine, I'll highlight the major components of the period-over-period change in adjusted EBITDA. Pricing, excluding the pass-through of higher sulfur costs, increased quarter over quarter, reflecting favorable contractual pricing for regeneration services and strong pricing for virgin sulfuric acid. The pass-through effect of higher average sulfur costs on sales was approximately $20 million, with the pass-through resulting in no material impact on adjusted EBITDA. Variable costs were favorable on product mix, volume, and customer mix unfavorable during the quarter, driven by lower event-driven niche custom catalyst sales in advanced silicas, along with unplanned and extended customer downtime within Ecoservices, partially offset by the sales volume contribution from the Wagaman sulfuric acid assets.

The remaining other component primarily represents higher manufacturing costs in Ecoservices, driven by general inflation and additional costs associated with the Wagaman acquisition, partially offset by lower turnaround costs. As we turn to our segment results on Page 10, I'll begin with a summary of the second quarter results for Ecoservices. Ecoservices sales were $176 million, up $22 million compared to the prior year. The higher sales reflect the $20 million pass-through effect of higher sulfur costs, along with favorable contractual pricing for regeneration services, strong pricing for virgin sulfuric acid, and the incremental sales contribution from the Wagaman sulfuric acid assets acquired during the second quarter. These factors were partially offset by lower regeneration services volume during the quarter.

Adjusted EBITDA for Ecoservices was $49.8 million, essentially unchanged compared to 2024, with favorable pricing and lower relative turnaround costs largely offset by lower regeneration services volume and higher anticipated manufacturing costs driven by general inflation. Turning to Advanced Materials and Catalysts on Slide 11, second quarter sales for Advanced Silicas were $24 million compared to $29 million in the year-ago quarter, with the change largely driven by lower event-driven custom catalyst sales. Sales of advanced silicas used in the production of polyethylene were essentially flat quarter over quarter.

Our proportionate 50% share of second quarter sales for the Zeolyst joint venture was $28 million compared to $29 million in the prior year, with lower sales of hydrocracking and custom catalysts associated with order timing, partially offset by higher sales of catalyst materials used in the production of sustainable fuels and other specialty catalysts. Second quarter adjusted EBITDA for the Advanced Materials and Catalysts segment was $13.7 million, above our guidance range and down slightly compared to the $14.7 million in the year-ago quarter, with the decrease largely due to lower sales volume of event-driven niche custom catalysts within Advanced Silicas.

Turning to cash and leverage on Slide 12, through the first six months, due to the timing of dividends from our Zeolyst joint venture and higher planned capital expenditures, our adjusted free cash flow was a use of $2 million compared to $14 million in 2024. In light of our expectations for the second half of the year, we have raised our guidance range for adjusted free cash flow to a range of $70 million to $80 million. 2025 was a quarter of unusually high cash deployment.

As noted, we closed the acquisition of the Wagaman sulfuric acid assets with a total cash outlay of $41 million, including the $35 million purchase price plus the customary working capital adjustments, and we repurchased $22 million of common stock during the quarter. As a result, we closed the second quarter with cash on hand of $69 million, down from $128 million as of March 31, 2025. Considering the lower cash balance at the end of the second quarter, leverage rose to 3.5 times compared to the 3.2 times at the end of the prior quarter. Excluding the cash impact of the acquisition and the share repurchases, our ratio would have been 3.2 times.

Total liquidity at quarter-end, including availability under our ABL facility of approximately $83 million, was a healthy $152 million. As we discussed on our last call, considering our current share price and associated valuation, we continue to believe that opportunistic share repurchases are a prudent and value-enhancing use of capital. While taking a more opportunistic approach, we anticipate ending 2025 with a leverage ratio consistent with the end of the prior year of around three times. I will now turn to our outlook for the remainder of 2025. We've had a solid start to the year, primarily due to favorable shifts.

As we look at the balance of the year, we expect demand fundamentals across the majority of the end uses that we serve to remain stable. However, we remain mindful that demand conditions in certain industrial end uses could change, with potential areas of soft demand being our sales of advanced materials used in the production of polyethylene or sales of virgin sulfuric acid into nylon or other industrial end uses. In terms of overall guidance, with the exception of revisions in quarterly guidance associated with shifts in order timing, our expectations for the balance of the year remain largely unchanged.

That said, we now expect that consolidated sales will be $795 million to $835 million, up from our previous guidance range, with the increase reflecting the incremental sales associated with the acquisition of the Wagaman sulfuric acid assets, partially offset by lower expected sales of polyethylene catalysts within Advanced Silicas. While our updated expectations are for lower than originally planned sales of polyethylene catalysts, we continue to expect that our advanced materials used in the production of polyethylene will continue to outpace growth in global demand, with the expected sales in 2025 reflecting year-over-year growth compared to 2024.

For the Zeolyst joint venture, sales in 2025 were higher than originally anticipated due to positive shifts in sales timing, and we expect further positivity in the sales of hydrocracking catalysts. We are raising our guidance range for our 50% share of sales in the Zeolyst joint venture to a range of $125 million to $140 million, providing for additional upside to our current forecast and offsetting the softer sales of polyethylene catalysts in Advanced Silicas.

For consolidated adjusted EBITDA, we are maintaining the midpoint of our previous guidance range, with some minor shifts among the segments in Corporate, and we are now narrowing the range to $242 million to $254 million to reflect our first-half results and our expectations for 2025. This guidance does not reflect any material contribution from the Wagaman sulfuric acid assets, as we still anticipate that the sales contribution from Wagaman will largely be offset by incremental costs, including costs for integration and upgrading the facility in 2025. As mentioned earlier, we have also revised our expectations for adjusted free cash flow, narrowing the range to $70 million to $80 million and raising the midpoint by $5 million to $75 million.

You will also note minor revisions in guidance for other modeling items. We have tightened and lowered the midpoint of our guidance for interest expense, which is now expected to be in the range of $46 million to $50 million. We have also increased our projection of depreciation and amortization expense, primarily related to Ecoservices, considering the addition of the Wagaman assets. Lastly, we have revised our expectations for adjusted net income and adjusted diluted income per share while maintaining the per-share midpoint of our previous guidance range. I'll now turn to specific guidance for the third quarter. We expect third quarter adjusted EBITDA for Ecoservices to fall in the range of $63 million to $69 million.

For Advanced Materials and Catalysts, taking into account changes in order timing, we expect third quarter adjusted EBITDA to be in the range of $7 million to $11 million. With the assumption that unallocated corporate expenses will be approximately $8 million in the third quarter, we expect consolidated adjusted EBITDA for the third quarter to be in the range of $62 million to $72 million. On Slide 14, we provide directional guidance for the fourth quarter. For Ecoservices, stable demand fundamentals and favorable pricing are expected to continue in the fourth quarter.

With the higher anticipated sales and lower expected turnaround costs, we expect segment adjusted EBITDA to be up on the order of $8 million to $12 million compared to the year-ago quarter. For Advanced Materials and Catalysts, due to shifts in sales timing between quarters, we now expect adjusted EBITDA to be in line with 2024. Comparing to the prior year, we expect strong sales of polyethylene catalysts and advanced silicas, along with higher sales of hydrocracking specialty and custom catalysts, partially offset by lower sales of sustainable fuel catalysts within the Zeolyst Joint Venture.

Lastly, with regard to planned turnaround activity for Ecoservices, you will note that a turnaround previously planned for the third quarter of this year is now scheduled for 2026, along with an expected turnaround in the fourth quarter related to the Wagaman facility. I will now turn the call back to Kurt for some closing remarks.

Kurt Bitting: Thank you, Mike. 2025 continues to provide a challenging operating environment for our industry, with companies in our sector facing issues that include global production overcapacity, pricing and margin pressures, and disruption related to the evolving tariff landscape. In this environment, Ecovyst Inc. has demonstrated consistent performance. Our strong results in 2025 underscore the resilience of our distinctive businesses, which we attribute to our leading supply positions, longstanding customer relationships, diverse geographic footprint, and a portfolio of technologies that are highly valued by our customers. As we continue to move into the second half of the year, we have good momentum that we believe positions us well to deliver on our full-year financial objectives.

We expect high refinery utilization will continue to benefit our regeneration services business and that tailwinds in incremental demand in the mining sector will provide support for virgin sulfuric acid sales for the balance of the year. Within our Advanced Materials and Catalyst segment, we anticipate strong sales performance for hydrocracking catalysts in 2025, with projected sales exceeding those of 2024. This positive outlook is underpinned by a substantial order book and confirmed orders. We also continue to expect growth in our sales of polyethylene catalysts and supports, and we expect sales of catalysts used for sustainable fuel production to be flat to slightly up in 2025.

Looking ahead, Ecovyst Inc. is well-positioned to benefit from prevailing trends such as the onshoring of manufacturing, the increased need for clean fuels, and growing mining operations for metals and minerals. We believe that our differentiated customer relationships and technological capabilities will enable us to translate the positive long-term sector momentum into steady growth. Ecovyst Inc.'s robust cash flow and resilient business model also enable us to further create value for our shareholders through growth investments such as the recent acquisition of the Wagaman plant, as well as by returning capital via share repurchases. Lastly, we acknowledge the significant interest in the strategic review of our Advanced Materials and Catalysts segment.

As communicated previously, we anticipate the process may extend through midyear 2025. We are making steady progress and expect to remain on this timeline. We anticipate providing additional updates in the near future. At this time, I will ask the operator to open the line for questions.

Operator: Thank you. We'll take our first question from Patrick Cunningham with Citi. Please go ahead. Your line is open.

Patrick Cunningham: Good morning, Kurt and Mike. Just with the new EPA guidelines for increased renewable fuel volume, have you already seen initial indications from customers coming back with additional activity here? I guess any early indications or visibility into what this might mean for the volumes in 2026?

Kurt Bitting: Hey, good morning, Patrick. Thank you for the question. So at this point, it's still early, and those are, I would say, draft RVOs, so it has to be fully adopted. But we are certainly encouraged by the new requirements that were set. I mean, as I said in my comments, a 67% increase year over year from 2025 to 2026. We feel that really is going to drive utilization. One of the issues that the industry has had in the last twelve months or so has been underutilization just with the low RIN credits and the uncertainty around the RVO.

So pushing that RVO up should drive higher utilizations in 2026, which then should lead to higher utilization of catalysts, more change-outs, and eventually additional capacity being put online. So we're pretty positive in terms of the direction that it's headed.

Patrick Cunningham: Understood. And then maybe just on the potential outlook for polyethylene sales here. It seemed to have a mixed view with strong sales expectation, but there's some incremental caution on the trade uncertainty. How much of your year-on-year growth is tied to startups? Have you heard any noise on potential delays in production or pressure on operating rates as a result of the current trade environment?

Kurt Bitting: No. I mean, clearly, polyethylene utilization rates have been impacted across the globe with the tariff uncertainty and I'd say the lackluster global macroeconomic environment. Some of that is there's some overcapacity in China that still weighs on the polyethylene industry. We still expect our sales to be up year over year, albeit probably falling short of what we had thought earlier this year. And obviously, in our AMAC segment, as we mentioned, that's being overcompensated by stronger hydrocracking and specialty catalyst sales. So we're cautious. I wouldn't say our sales this year aren't necessarily for new units, just our run rate with our existing customers.

We are continuing with our Kansas City expansion, and we're expecting those customers that are going to take the offtake of that plant or that plant expansion to come online in 2026.

Patrick Cunningham: Very helpful. Thank you so much.

Operator: Thank you. Our next question comes from John McNulty with BMO Capital Markets. Please go ahead. Your line is open.

John McNulty: Hey. Good morning. Thanks for taking my question. So now that you've finalized or settled on the Cornerstone business, I guess any update in terms of how you're thinking about some of these synergies coming through and the earnings opportunities, say, in 2026? I know this year, there's some integration and some costs of upgrading, etcetera. But I guess, how do you think about the contribution as we look out a year?

Kurt Bitting: Yes. John, thanks for the question. As we mentioned, this year, we believe that we are going to see additional sales, of course, coming out of the acquisition, albeit kind of offset with some additional costs that we're incurring really to get that business up and running into our level of operations. For next year, we're not going to give directional or specific guidance yet, but we do believe that it is a very good acquisition for us, allowing for additional opportunities within the Gulf Coast. Among the other plants that we serve to help serve some of our customers, along with the new customers that we see. The integration of the plant is going very well.

We see opportunities both at the plant locations to improve what we see there, along with looking at opportunities at our other plants as well. We also do see additional opportunities from a spot standpoint within the virgin sulfuric acid that will help us next year as well.

John McNulty: Got it. Okay, fair enough. Then I guess you had mentioned early on that you've got some new areas where you're doing some trials, and it looks like some of that may materialize as you look into 2026. I guess can you give us a little bit of color as to what those trials or those pilot programs are really on at this point? I know you had a bunch kind of in the hopper.

Kurt Bitting: Yeah. That's, you know, primarily, I'd say, in the AMAC segment, we talk about biocatalysis. There's been a lot of interest in that area that's obviously growing very rapidly, and the interest in using silicas as a carrier for the enzymes continues to draw a lot of interest. So we've been working with a lot of customers signing joint development agreements and so forth, working with them to get those products specked in. And I would point to advanced recycling also, their customer taking pilot samples of our catalysts that are obviously used in advanced recycling that help lower the energy intensity of that process and improve the byproduct. So there's been good interest around that as well.

John McNulty: Got it. Thanks very much for the color.

Operator: Our next question comes from David Begleiter with Deutsche Bank. Please go ahead. Your line is open.

David Begleiter: Thank you. Good morning, Kurt and Mike. Just on the strategic review, remind us what the process you're going through, what you're looking at, and what are the various options on the table for this business and these assets?

Kurt Bitting: Thank you. Yes. So the yes, as we stated as the Board thank you, Dave, for the question. As we stated last year, the review is really looking at a full spectrum of options to deliver really what we think is the most value for our shareholders in relation to the AMAC business, which, you know, that could be a whole bunch of different types of options. Like we said on the call, we're happy with where progress is at. We're still moving forward with it. We should have some further details on it in the near future.

David Begleiter: Got it. And just on leverage, given the uptick in the quarter, when would we expect to get to your leverage target assuming no M&A or other asset dispositions? Thank you.

Mike Feehan: Yes. No, we definitely saw an uptick on the leverage up to 3.5 times, but that was primarily due to the acquisition of the Wagaman location along with some of the share repurchase activities, right? But if you look at our free cash flow target for the rest of the year, our expectations for the remainder of the year, the leverage ratio will come down. Clearly into the range that we expected for the year. Likely in around a three times leverage. We're still targeting long term to be in the two to 2.5 times range.

However, we do want to ensure that we take every dollar that we're making, put it back into organic growth opportunities, and then with the level of where our stock price is trading and the intrinsic value and long-term growth potential of the business, we still see share repurchase as an opportunistic way to create shareholder value in the future. And then, you know, with the acquisition of the Wagaman location, you know, we continue to see if there's options for additional bolt-on opportunities in the future.

David Begleiter: Thank you.

Operator: Thank you. Our next question comes from Aleksey Yefremov with KeyBanc Capital Markets. Please go ahead. Your line is open.

Aleksey Yefremov: Thanks. Good morning, everyone. Just wanted to follow-up on the biofuels. Assuming the current proposal was approved in its current state, right, so about 67%, as you said, RVO growth, year. How should we think about the sensitivity of your business to that growth? I mean, over time, should your Catalyst business also grow in that same range by, I don't know, 60, 70%? Or should it be some smaller or larger number?

Kurt Bitting: Yes. Thanks for the question, Aleksey. I think the way I would look at the RVO is really, you know, the proposed RVO changes are really re-injecting momentum back into the renewable fuels, which has stepped back, I would say, over the last twelve months with really overcapacity and lower RIN prices. So we believe that increased RVO is going to drive up the utilization, which will eventually lead to, you know, more frequent catalyst change-outs and additional capacity coming online. I don't think the 67% is going to be a year-over-year step change for our business. Already, we've seen the business we believe that we're going to be flat to slightly up for this year.

So we've seen, I would say, a stabilization of that. But we do think long term with that additional RVO will create some momentum and clearly translate into growth in that segment for us. But not I wouldn't look at the instantaneous year-over-year and try to apply that to our growth rate for any short period of time.

Aleksey Yefremov: Thanks. And on sulfuric acid, I think you're baking in some pickup in nylon later this year, and I know we've all been burned on maybe getting a little too optimistic there. So why include this? How much visibility do you have? And also any outlook for sort of mining, nylon, these industrial uses next year and for virgin sulfuric acid?

Kurt Bitting: Sure. It's just on nylon. And re-ask the question, if I don't answer it, you broke up a little bit on the first part of the nylon segment. But our view on nylon this year, Aleksey, I think is we are going to be up year over year in that space. You know, albeit it remains a somewhat tepid year in that industry. And then, you know, that's obviously widely reported the global nylon market remains oversupplied. You know, where we're positioned, where our customers are positioned particularly in the Gulf Coast. They've got some obviously, some advantages over the rest of the world on a cost basis. So I think they benefit a little bit from that.

So for us, in our virgin sulfuric, we believe we're going to be up year over year, albeit not, you know, not certainly not a bumper year or anything along those lines. For mining, there's tremendous momentum in mining. There's new copper projects coming online this year. We're going to participate in all the mines, and I'm sure you've read the headlines, there's multiple new mines being approved. And that's really being driven by the I wouldn't point to the tariffs, but the need for copper for data transmission, for electrical conductivity, all related to the data centers that are being built and all the needs for electrification and green energy and so forth.

So we view long-term mining remains very, very positive, and we expect to have a stronger second half in mining as some of those new projects come online.

Aleksey Yefremov: Thank you.

Operator: And as a reminder, it is star and one on your telephone keypad. We will move next with Hamed Khorsand with BWS Financial. Please go ahead. Your line is open.

Hamed Khorsand: Hi. About Wagaman, it sounds like you're still putting some investments in there. Do you have a timeline as to when it would actually contribute to free cash flow?

Mike Feehan: Yes. Hi, good morning, Hamed. Yes, the free cash flow generation will follow the earnings, right? So we don't expect a significant amount of free cash flow to be generated this year. However, certainly with the synergies and the acquisition and the size of it, we expect it to generate positively in 2026.

Hamed Khorsand: Okay. And then do you have any pricing power at all in the sulfuric acid for mining?

Kurt Bitting: Yeah. I think, you know, our mining agreements, Hamed, are generally, you know, they're not spot in nature. They're, you know, longer-term, not super long-term, but, you know, there are pricing mechanisms in those where, you know, demand goes up, actually the pricing can go up as well. So I would just say the overall momentum in mining and the demand for the sulfuric acid that's coming from that sector rising and rising is just kind of, you know, the tide that's lifting all boats. So it is it's creating positive momentum, you know, across the industry for sulfuric acid present.

Hamed Khorsand: Okay. Thank you.

Operator: Thank you. And our next question comes from Laurence Alexander with Jefferies. Please go ahead. Your line is open.

Laurence Alexander: Good morning. Could you give a little bit more detail on the order timing and what that might imply for the rhythm of 2026? And then secondly, can you talk a little bit about the polyethylene catalyst as capacity shuts in Europe and as you get newer plants built in Asia, is there any change in your revenue per tonne of capacity? Is one better for you than the other? Thanks.

Kurt Bitting: Yes. Thanks for the question. On the first one, from an order timing standpoint, the order timing that we saw earlier in the year is expected to just shift from part of the latter part of the year. So we don't expect that to be materially different for next year. We do see higher expected sales of hydrocracking catalysts this year, and that's just demand-driven. So the timing that we've been discussing for the first half of the year is just between the second half and first half, so no impact on 2026.

Laurence Alexander: Yes. Thank you for the question, Laurence. Really, polyethylene, you know, as you point out, there's clearly, you know, capacity being rationalized in Europe that's generally a pretty small exposure for us in terms of our customer base and where we see the growth. And, you know, as we refer to the Kansas City expansion, those are based on projects for North America and The Middle East. So there's really I don't think there's really a huge difference in terms of revenue per ton or anything. It's just more of the volumetric demand coming from those new sites is obviously going to pull up our sales and volume of sales into polyethylene catalysts and supports. Thank you.

Operator: Thank you. And we have no further questions in queue at this time. This does conclude the Ecovyst Inc. Second Quarter 2025 Earnings Call and Webcast. Thank you for your participation. You may disconnect at any time.