ecvt-20240331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


(Mark One)
☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-38221

Ecovyst Inc.

Delaware

81-3406833

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer
Identification No.)

300 Lindenwood Drive

Malvern, Pennsylvania

19355

(Address of principal executive offices)

(Zip Code)

(484)

617-1200

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading symbol

Name of each exchange on which registered

Common stock, par value $0.01 per share

ECVT

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of common stock outstanding as of April 26, 2024 was 117,005,486.

Table of Contents

Ecovyst Inc.

INDEX—FORM 10-Q

March 31, 2024


		Page
PART I	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)
	Condensed Consolidated Statements of Income	3
	Condensed Consolidated Statements of Comprehensive Income	4
	Condensed Consolidated Balance Sheets	5
	Condensed Consolidated Statements of Stockholders’ Equity	6
	Condensed Consolidated Statements of Cash Flows	7
	Notes to Condensed Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	38
Item 4.	Controls and Procedures	38

PART II	OTHER INFORMATION
Item 1.	Legal Proceedings	38
Item 1A.	Risk Factors	38
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	39
Item 5.	Other Information	40
Item 6.	Exhibits	40

	SIGNATURES	41

Table of Contents

PART I—FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)

ECOVYST INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except share and per share amounts)

(unaudited)


	Three months ended March 31,
		2024		2023
Sales		$	160,537	$	160,874
Cost of goods sold		121,314		124,381
Gross profit		39,223		36,493
Selling, general and administrative expenses		21,604		21,119
Other operating expense, net		3,666		6,716
Operating income		13,953		8,658
Equity in net (income) from affiliated companies		(2,072)		(223)
Interest expense, net		13,409		9,832

Other expense (income), net		216		(427)
Income (loss) before income taxes		2,400		(524)
Provision for income taxes		1,179		947
Net income (loss)		$	1,221	$	(1,471)

Net income (loss) per share:
Basic income (loss) per share		$	0.01	$	(0.01)
Diluted income (loss) per share		$	0.01	$	(0.01)

Weighted average shares outstanding:
Basic		116,955,043		122,178,867
Diluted		117,451,149		122,178,867

See accompanying notes to condensed consolidated financial statements.

Table of Contents

ECOVYST INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands)

(unaudited)


	Three months ended March 31,
		2024		2023
Net income (loss)		$	1,221	$	(1,471)
Other comprehensive income (loss), net of tax:
Pension and postretirement costs		(6)		(24)
Net gain (loss) from hedging activities		3,864		(7,920)
Foreign currency translation		(1,684)		2,185
Total other comprehensive income (loss)		2,174		(5,759)
Comprehensive income (loss)		$	3,395	$	(7,230)

See accompanying notes to condensed consolidated financial statements.

Table of Contents

ECOVYST INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

(unaudited)


	March 31, 2024		December 31, 2023
ASSETS
Cash and cash equivalents	$	103,136	$	88,365
Accounts receivable, net	78,432		81,314
Inventories, net	52,503		45,115
Derivative assets	13,490		13,419
Prepaid and other current assets	20,968		17,774
Total current assets	268,529		245,987
Investments in affiliated companies	413,171		440,198
Property, plant and equipment, net	572,307		576,904
Goodwill	404,252		404,470
Other intangible assets, net	112,928		116,550
Right-of-use lease assets	25,813		24,281
Other long-term assets	33,813		29,361
Total assets	$	1,830,813	$	1,837,751
LIABILITIES
Current maturities of long-term debt	$	9,000	$	9,000
Accounts payable	33,544		40,195
Operating lease liabilities—current	8,207		8,193
Accrued liabilities	56,756		61,693
Total current liabilities	107,507		119,081
Long-term debt, excluding current portion	857,220		858,946
Deferred income taxes	117,234		115,791
Operating lease liabilities—noncurrent	17,446		16,030
Other long-term liabilities	20,050		22,439
Total liabilities	1,119,457		1,132,287
Commitments and contingencies (Note 15)
EQUITY
Common stock ($0.01 par); authorized shares 450,000,000; issued shares 140,872,846 and 140,744,045 on March 31, 2024 and December 31, 2023, respectively; outstanding shares 117,001,446 and 116,116,895 on March 31, 2024 and December 31, 2023, respectively	1,409		1,407
Preferred stock ($0.01 par); authorized shares 50,000,000; no shares issued or outstanding on March 31, 2024 and December 31, 2023	—		—
Additional paid-in capital	1,096,965		1,102,581
Accumulated deficit	(169,635)		(170,856)
Treasury stock, at cost; shares 23,871,400 and 24,627,150 on March 31, 2024 and December 31, 2023, respectively	(218,599)		(226,710)
Accumulated other comprehensive income (loss)	1,216		(958)
Total equity	711,356		705,464
Total liabilities and equity	$	1,830,813

SEC Form 10-Q filed by Ecovyst Inc.