Ecovyst Reports Strong Fourth Quarter and Full Year 2021 Results as Growth Momentum Boosted Profitability
Ecovyst reported significant growth in 2021, with sales rising 23% to $611.2 million and Adjusted EBITDA increasing by 18% to $227.6 million. Despite a decrease in net income, driven by higher costs, the company successfully launched as a pure-play catalyst and services provider. Q4 2021 sales surged 37% year-over-year, reaching $170.2 million. The outlook for 2022 projects sales between $730 million and $750 million, alongside a 16% expected increase in Adjusted EBITDA. The company is also focusing on sustainability with a strong emphasis on innovation in its product offerings.
- Sales increased 23% year-over-year to $611.2 million in 2021.
- Adjusted EBITDA rose 18% year-over-year to $227.6 million.
- Fourth quarter sales grew 37% year-over-year to $170.2 million.
- 2022 sales outlook predicts a 21% growth to between $730 million and $750 million.
- Successful transformation into a high-growth catalyst and services company.
- Sales of catalysts for renewable fuels nearly tripled from the previous year.
- Adjusted Free Cash Flow expected to rise to $115-$125 million in 2022.
- Net income decreased by 97% to $1.8 million in 2021.
- Higher variable costs from inflation impacted profitability, particularly from sulfur and energy costs.
- Net cash from operating activities decreased by $93.7 million to $129.9 million compared to 2020.
Expect
Full Year 2021 Results & Highlights
-
Sales of
, up$611.2 million 23% year-over-year; -
Net income of
with diluted income per share of$1.8 million . Adjusted net income of$0.01 with Adjusted diluted income per share of$69.6 million ;$0.51 -
Adjusted EBITDA of
, up$227.6 million 18% year-over-year; -
Net cash from operations of
, Adjusted Free Cash Flow of$129.9 million , and reduced net debt leverage ratio to 3.3x at year-end;$93.2 million -
Successful Transformation Complete – Launched Ecovyst as a High Growth,
Pure-Play Catalysts and Services Company ; - Sales growth in catalyst used for renewable fuels nearly tripled from the prior year;
Fourth Quarter 2021 Results & Highlights
-
Sales of
, up$170.2 million 37% year-over-year; -
Net income of
with diluted income per share of$7.8 million . Adjusted net income of$0.06 with Adjusted diluted income per share of$22.9 million ;$0.17 -
Adjusted EBITDA of
, up$63.2 million 38% year-over-year; -
Adjusted EBITDA margins of
30.6% , up 60 bps year-over-year (inclusive of 280 bps negative impact from sulfur cost pass through) as price more than offset higher costs, demonstrating resilient profitability;
2022 Financial Outlook
-
Sales of
to$730 million 1, up$750 million 21% from 2021 at the mid-point of the range; -
Sales of
to$150 million for proportionate$160 million 50% share of Zeolyst Joint Venture, which is excluded from GAAP Sales; -
Adjusted EBITDA of
to$260 million , up$270 million 16% from 2021 at the mid-point of the range; -
Adjusted Free Cash Flow of
to$115 million ;$125 million
1Sales outlook for 2022 includes approximately
Financial results and outlook include non-GAAP financial measures. These non-GAAP measures are more fully described and are reconciled from the respective measures determined under GAAP in “Presentation of Non-GAAP Financial Measures” and the attached appendix.
For the fourth quarter, sales of
For the year, sales of
“2021 was a highly successful and transformational year as the
Review of Segment Results and Business Trends
The macroeconomic recovery gained momentum throughout 2021 and drove improved demand across most product categories, end-uses, and customers. Sequential quarterly sales continued to improve resulting in a strong second half of 2021. Inflationary factors increased through the year, namely from higher sulfur and energy costs, but customer contractual pass through mechanisms preserved earnings in
Our regeneration services support the production of alkylate, a high value gasoline component critical for meeting stringent gasoline standards and for producing premium grade gasoline. Tightening gasoline standards and growing demand for premium grade gasoline to power fuel efficient engines is supporting high alkylation utilization rates. Increased mining for metals and minerals to support low carbon technologies as well as strong demand for construction related materials is benefiting virgin sulfuric acid. Sustainability trends continue to favor the treatment services business because customers are seeking more sustainable waste solutions as offered by
For the quarter ended
For the year, sales of
Catalyst Technologies
Polyethylene demand remained resilient, driven by the growing consumer demand for films and packaging. Higher refinery utilization rates are expected to continue to increase catalyst demand for both traditional and renewable fuels as overall energy demand was strong during the beginning of 2022. Our catalyst sales into renewable diesel nearly tripled from the prior year. Emission control catalyst demand is expected to improve throughout 2022 as production of heavy duty diesel vehicles is anticipated to increase to satisfy pent up demand.
For the quarter ended
For the year, Silica Catalysts sales of
Executing on our ESG Ambitions
We are focused on implementing and accelerating sustainability initiatives. We tailor our products for the specific needs of our customers and support them in addressing their technical and operational challenges. Through close collaboration with our global customers, we have been long standing suppliers of sustainability products and services, helping to address tightening global regulatory standards and changing consumer preferences.
For example, we continue to develop products that improve air quality through lower sulfur and NOx emissions in fuels. We are focused on the development of catalysts that help make plastics stronger and lighter enabling the recycling of mixed plastics to complete the plastics circularity curve. We also help enable higher alkylation for improved fuel economy and transform biomass into biofuels and synthetic rubber for green tires.
We also set clear and aggressive targets to address our own footprint related to GHG emissions, waste management, and product sustainability. With greater focus and resources,
Cash Flows and Balance Sheet
For the year ended
At
Conference Call and Webcast Details
On
Investors may listen to the conference call live via telephone by dialing 1 (866) 342-8591 (domestic) or 1 (203) 518-9713 (international) and use the participant code ECVTQ421.
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:
(484) 617-1225
Chris.Evans@ecovyst.com
General Investor Inquiries:
InvestorRelations@ecovyst.com
About
We have two uniquely positioned specialty businesses:
Presentation of Non-GAAP Financial Measures
In addition to the results provided in accordance with
The Company is not able to provide a reconciliation of the company’s non-GAAP financial guidance to the corresponding GAAP measures without unreasonable effort because of the inherent difficulty in forecasting and quantifying certain amounts necessary for such a reconciliation such as certain non-cash, nonrecurring or other items that are included in net income and EBITDA as well as the related tax impacts of these items and asset dispositions / acquisitions and changes in foreign currency exchange rates that are included in cash flow, due to the uncertainty and variability of the nature and amount of these future charges and costs.
Zeolyst Joint Venture
The company’s zeolite catalysts product group operates through its Zeolyst Joint Venture, which is accounted for as an equity method investment in accordance with GAAP. The presentation of the Zeolyst Joint Venture’s sales represents
Note on Forward-Looking Statements
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, liquidity, prospects, growth, strategies, capital allocation program, product and service offerings, including the impact of the COVID-19 pandemic on such items, expected demand trends and our 2022 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 the ongoing COVID-19 pandemic, tariffs and trade disputes, currency exchange rates and other factors, including those described in the sections titled “Risk Factors” and “Management Discussion & Analysis of Financial Condition and Results of Operations” in our filings with the
|
||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF INCOME |
||||||||||||||||||||||
(on a continuing operations basis) |
||||||||||||||||||||||
|
|
Three months ended
|
|
% |
|
Years ended
|
|
% |
||||||||||||||
|
|
2021 |
|
2020 |
|
Change |
|
2021 |
|
2020 |
|
Change |
||||||||||
|
|
(in millions, except percentages, share and per share amounts) |
||||||||||||||||||||
Sales |
|
$ |
170.2 |
|
|
$ |
124.1 |
|
|
37.1 |
% |
|
$ |
611.2 |
|
|
$ |
495.9 |
|
|
23.3 |
% |
Cost of goods sold |
|
|
115.7 |
|
|
|
86.4 |
|
|
33.9 |
% |
|
|
434.5 |
|
|
|
345.0 |
|
|
25.9 |
% |
Gross profit |
|
|
54.5 |
|
|
|
37.5 |
|
|
45.3 |
% |
|
|
176.7 |
|
|
|
150.9 |
|
|
17.1 |
% |
Selling, general and administrative expenses |
|
|
29.0 |
|
|
|
20.0 |
|
|
45.0 |
% |
|
|
97.8 |
|
|
|
81.5 |
|
|
20.0 |
% |
Other operating expense, net |
|
|
7.5 |
|
|
|
6.5 |
|
|
15.4 |
% |
|
|
24.3 |
|
|
|
17.8 |
|
|
36.5 |
% |
Operating income |
|
|
18.0 |
|
|
|
11.0 |
|
|
63.6 |
% |
|
|
54.6 |
|
|
|
51.6 |
|
|
5.8 |
% |
Equity in net income from affiliated companies |
|
|
(7.0 |
) |
|
|
(1.1 |
) |
|
536.4 |
% |
|
|
(27.7 |
) |
|
|
(21.0 |
) |
|
31.9 |
% |
Interest expense, net |
|
|
8.8 |
|
|
|
9.5 |
|
|
(7.4 |
)% |
|
|
37.0 |
|
|
|
50.4 |
|
|
(26.6 |
)% |
Debt extinguishment costs |
|
|
— |
|
|
|
8.5 |
|
|
(100.0 |
)% |
|
|
26.9 |
|
|
|
25.0 |
|
|
7.6 |
% |
Other (income) expense, net |
|
|
1.4 |
|
|
|
(4.8 |
) |
|
(129.2 |
)% |
|
|
4.5 |
|
|
|
(5.0 |
) |
|
(190.0 |
)% |
Income (loss) before income taxes |
|
|
14.8 |
|
|
|
(1.1 |
) |
|
NM |
|
|
|
13.9 |
|
|
|
2.2 |
|
|
531.8 |
% |
Provision (benefit) for income taxes |
|
|
7.0 |
|
|
|
(47.1 |
) |
|
(114.9 |
)% |
|
|
12.1 |
|
|
|
(52.1 |
) |
|
(123.2 |
)% |
Effective tax rate |
|
|
47.3 |
% |
|
|
4,281.8 |
% |
|
|
|
|
87 |
% |
|
|
(2,351 |
)% |
|
|
||
Net income |
|
|
7.8 |
|
|
|
46.0 |
|
|
(83.0 |
)% |
|
|
1.8 |
|
|
|
54.3 |
|
|
(96.7 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income per share: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic income per share - continuing operations |
|
$ |
0.06 |
|
|
$ |
0.34 |
|
|
|
|
$ |
0.01 |
|
|
$ |
0.40 |
|
|
|
||
Diluted income per share - continuing operations |
|
$ |
0.06 |
|
|
$ |
0.34 |
|
|
|
|
$ |
0.01 |
|
|
$ |
0.40 |
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic |
|
|
136,256,601 |
|
|
|
135,406,081 |
|
|
|
|
|
136,167,384 |
|
|
|
135,528,977 |
|
|
|
||
Diluted |
|
|
137,528,028 |
|
|
|
136,284,272 |
|
|
|
|
|
137,708,931 |
|
|
|
136,450,953 |
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
CONSOLIDATED BALANCE SHEETS |
||||||||
(in millions, except share and per share amounts) |
||||||||
|
|
|
|
|||||
ASSETS |
|
|
|
|||||
Cash and cash equivalents |
$ |
140.9 |
|
|
$ |
113.4 |
|
|
Accounts receivables, net |
|
80.8 |
|
|
|
45.9 |
|
|
Inventories, net |
|
53.8 |
|
|
|
52.8 |
|
|
Prepaid and other current assets |
|
16.2 |
|
|
|
11.5 |
|
|
Current assets held for sale |
|
— |
|
|
|
205.1 |
|
|
Total current assets |
|
291.7 |
|
|
|
428.7 |
|
|
Investments in affiliated companies |
|
446.1 |
|
|
|
458.1 |
|
|
Property, plant and equipment, net |
|
596.2 |
|
|
|
591.7 |
|
|
|
|
406.1 |
|
|
|
391.6 |
|
|
Other intangible assets, net |
|
145.6 |
|
|
|
137.4 |
|
|
Right-of-use lease assets |
|
30.1 |
|
|
|
28.9 |
|
|
Other long-term assets |
|
15.4 |
|
|
|
12.5 |
|
|
Long-term assets held for sale |
|
— |
|
|
|
1,149.4 |
|
|
Total assets |
$ |
1,931.2 |
|
|
$ |
3,198.3 |
|
|
LIABILITIES |
|
|
|
|||||
Current maturities of long-term debt |
$ |
9.0 |
|
|
$ |
— |
|
|
Accounts payable |
|
51.9 |
|
|
|
38.1 |
|
|
Operating lease liabilities—current |
|
8.3 |
|
|
|
6.7 |
|
|
Accrued liabilities |
|
75.9 |
|
|
|
48.5 |
|
|
Current liabilities held for sale |
|
— |
|
|
|
108.5 |
|
|
Total current liabilities |
|
145.1 |
|
|
|
201.8 |
|
|
Long-term debt, excluding current portion |
|
872.8 |
|
|
|
1,400.4 |
|
|
Deferred income taxes |
|
126.7 |
|
|
|
126.2 |
|
|
Operating lease liabilities—noncurrent |
|
21.7 |
|
|
|
22.0 |
|
|
Other long-term liabilities |
|
24.2 |
|
|
|
15.3 |
|
|
Long-term liabilities of held for sale |
|
— |
|
|
|
155.4 |
|
|
Total liabilities |
|
1,190.5 |
|
|
|
1,921.1 |
|
|
Commitments and contingencies |
|
|
|
|||||
EQUITY |
|
|
|
|||||
Common stock ( |
|
1.4 |
|
|
|
1.4 |
|
|
Preferred stock ( |
|
— |
|
|
|
— |
|
|
Additional paid-in capital |
|
1,073.4 |
|
|
|
1,477.9 |
|
|
Accumulated deficit |
|
(315.7 |
) |
|
|
(175.8 |
) |
|
|
|
(12.6 |
) |
|
|
(11.1 |
) |
|
Accumulated other comprehensive loss |
|
(5.8 |
) |
|
|
(15.3 |
) |
|
|
|
740.7 |
|
|
|
1,277.1 |
|
|
Noncontrolling interest |
|
— |
|
|
|
0.1 |
|
|
Total equity |
|
740.7 |
|
|
|
1,277.2 |
|
|
Total liabilities and equity |
$ |
1,931.2 |
|
|
$ |
3,198.3 |
|
|
|
|
|
|
|
||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
|
|
Years ended |
||||||
|
|
2021 |
|
2020 |
||||
Cash flows from operating activities: |
|
(in millions) |
||||||
Net loss |
|
$ |
(139.6 |
) |
|
$ |
(281.7 |
) |
Net loss from discontinued operations |
|
|
141.4 |
|
|
|
336.0 |
|
Adjustments to reconcile net loss to net cash provided by operating activities: |
|
|
|
|
||||
Depreciation |
|
|
66.0 |
|
|
|
65.3 |
|
Amortization |
|
|
13.8 |
|
|
|
11.6 |
|
Amortization of deferred financing costs and original issue discount |
|
|
1.9 |
|
|
|
2.5 |
|
Debt extinguishment costs |
|
|
21.2 |
|
|
|
22.7 |
|
Foreign currency exchange loss (gain) |
|
|
4.7 |
|
|
|
(5.3 |
) |
Pension and postretirement healthcare benefit expense |
|
|
(0.3 |
) |
|
|
0.4 |
|
Pension and postretirement healthcare benefit funding |
|
|
— |
|
|
|
(3.3 |
) |
Deferred income tax provision (benefit) |
|
|
4.5 |
|
|
|
(60.1 |
) |
Net loss on asset disposals |
|
|
5.7 |
|
|
|
4.7 |
|
Stock compensation |
|
|
31.8 |
|
|
|
17.2 |
|
Equity in net income from affiliated companies |
|
|
(27.7 |
) |
|
|
(21.1 |
) |
Dividends received from affiliated companies |
|
|
35.0 |
|
|
|
40.0 |
|
Other, net |
|
|
(3.0 |
) |
|
|
(3.5 |
) |
Working capital changes that provided (used) cash, excluding the effect of acquisitions and dispositions: |
|
|
|
|
||||
Receivables |
|
|
(33.5 |
) |
|
|
7.0 |
|
Inventories |
|
|
0.6 |
|
|
|
(3.0 |
) |
Prepaids and other current assets |
|
|
(7.8 |
) |
|
|
(1.4 |
) |
Accounts payable |
|
|
10.0 |
|
|
|
6.9 |
|
Accrued liabilities |
|
|
12.6 |
|
|
|
5.0 |
|
Net cash provided by operating activities, continuing operations |
|
|
137.3 |
|
|
|
140.1 |
|
Net cash (used in) provided by operating activities, discontinued operations |
|
|
(7.4 |
) |
|
|
83.5 |
|
Net cash provided by operating activities |
|
|
129.9 |
|
|
|
223.6 |
|
Cash flows from investing activities: |
|
|
|
|
||||
Purchases of property, plant and equipment |
|
|
(60.0 |
) |
|
|
(54.8 |
) |
Proceeds from business divestiture, net of cash and indebtedness |
|
|
978.4 |
|
|
|
624.3 |
|
Proceeds from sale of assets |
|
|
— |
|
|
|
2.4 |
|
Business combinations, net of cash acquired |
|
|
(42.6 |
) |
|
|
— |
|
Other, net |
|
|
(0.1 |
) |
|
|
(0.1 |
) |
Net cash provided by investing activities, continuing operations |
|
|
875.7 |
|
|
|
571.8 |
|
Net cash (used in) investing activities, discontinued operations |
|
|
(40.0 |
) |
|
|
(20.3 |
) |
Net cash provided by investing activities |
|
|
835.7 |
|
|
|
551.5 |
|
Cash flows from financing activities: |
|
|
|
|
||||
Draw down of revolving credit facilities |
|
|
— |
|
|
|
126.5 |
|
Repayments of revolving credit facilities |
|
|
— |
|
|
|
(126.5 |
) |
Issuance of long-term debt, net of original issue discount and financing fees |
|
|
897.8 |
|
|
|
640.3 |
|
Debt issuance costs |
|
|
(1.3 |
) |
|
|
(9.0 |
) |
Debt prepayment fees |
|
|
(8.5 |
) |
|
|
(10.6 |
) |
Repayments of long-term debt |
|
|
(1,430.9 |
) |
|
|
(1,091.1 |
) |
Proceeds from financing obligation |
|
|
16.0 |
|
|
|
— |
|
Dividends paid to stockholders |
|
|
(435.6 |
) |
|
|
(243.7 |
) |
Repurchases of common shares |
|
|
— |
|
|
|
(2.1 |
) |
Tax withholdings on equity award vesting |
|
|
(1.5 |
) |
|
|
(2.5 |
) |
Proceeds from stock options exercised |
|
|
0.7 |
|
|
|
0.4 |
|
Repayments of finance lease obligations |
|
|
(1.4 |
) |
|
|
— |
|
Other |
|
|
1.5 |
|
|
|
(1.9 |
) |
Net cash provided by financing activities, continuing operations |
|
|
(963.1 |
) |
|
|
(717.7 |
) |
Net cash provided by financing activities, discontinued operations |
|
|
(1.1 |
) |
|
|
(2.6 |
) |
Net cash provided by financing activities |
|
|
(964.2 |
) |
|
|
(722.8 |
) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
|
2.3 |
|
|
|
11.1 |
|
Net change in cash, cash equivalents and restricted cash |
|
|
3.7 |
|
|
|
63.3 |
|
Cash, cash equivalents and restricted cash at beginning of period |
|
|
137.2 |
|
|
|
73.9 |
|
Cash, cash equivalents and restricted cash at end of period |
|
|
140.9 |
|
|
|
137.2 |
|
Less cash, cash equivalents and restricted cash of discontinued operations |
|
|
— |
|
|
|
(22.2 |
) |
Cash, cash equivalents and restricted cash at end of period of continuing operations |
|
$ |
140.9 |
|
|
$ |
115.0 |
|
|
|
|
|
|
Appendix Table A-1: Reconciliation of Net Income to Adjusted EBITDA |
||||||||||||||||
|
|
Three months ended
|
|
Years ended
|
||||||||||||
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
|
|
(in millions) |
||||||||||||||
Reconciliation of net income to Adjusted EBITDA |
|
|
|
|
|
|
|
|
||||||||
Net income from continuing operations |
|
$ |
7.8 |
|
|
$ |
46.0 |
|
|
$ |
1.8 |
|
|
$ |
54.3 |
|
Provision (benefit) for income taxes |
|
|
7.0 |
|
|
|
(47.1 |
) |
|
|
12.1 |
|
|
|
(52.1 |
) |
Interest expense, net |
|
|
8.8 |
|
|
|
9.5 |
|
|
|
37.0 |
|
|
|
50.4 |
|
Depreciation and amortization |
|
|
19.6 |
|
|
|
20.4 |
|
|
|
79.7 |
|
|
|
76.9 |
|
EBITDA |
|
|
43.2 |
|
|
|
28.8 |
|
|
|
130.6 |
|
|
|
129.5 |
|
Joint venture depreciation, amortization and interest(a) |
|
|
4.2 |
|
|
|
3.6 |
|
|
|
15.6 |
|
|
|
14.7 |
|
Amortization of investment in affiliate step-up(b) |
|
|
1.6 |
|
|
|
1.6 |
|
|
|
6.5 |
|
|
|
6.6 |
|
Debt extinguishment costs |
|
|
— |
|
|
|
8.5 |
|
|
|
26.9 |
|
|
|
25.0 |
|
Net loss on asset disposals(c) |
|
|
1.2 |
|
|
|
3.5 |
|
|
|
5.7 |
|
|
|
4.7 |
|
Foreign currency exchange (gain) loss(d) |
|
|
(0.1 |
) |
|
|
(4.7 |
) |
|
|
4.7 |
|
|
|
(5.3 |
) |
LIFO expense (benefit)(e) |
|
|
0.1 |
|
|
|
(0.4 |
) |
|
|
(1.9 |
) |
|
|
(5.3 |
) |
Transaction and other related costs(f) |
|
|
0.4 |
|
|
|
(0.3 |
) |
|
|
2.0 |
|
|
|
1.1 |
|
Equity-based compensation |
|
|
9.0 |
|
|
|
3.9 |
|
|
|
31.8 |
|
|
|
17.2 |
|
Restructuring, integration and business optimization expenses(g) |
|
|
0.6 |
|
|
|
0.6 |
|
|
|
3.0 |
|
|
|
2.0 |
|
Defined benefit plan pension cost (benefit)(h) |
|
|
1.3 |
|
|
|
(0.1 |
) |
|
|
(0.9 |
) |
|
|
(0.6 |
) |
Other(i) |
|
|
1.7 |
|
|
|
0.9 |
|
|
|
3.6 |
|
|
|
3.0 |
|
Adjusted EBITDA |
|
$ |
63.2 |
|
|
$ |
45.9 |
|
|
$ |
227.6 |
|
|
$ |
192.6 |
|
|
|
|
|
|
|
|
|
|
Descriptions to Ecovyst Non-GAAP Reconciliations |
||
(a) |
We use Adjusted EBITDA as a performance measure to evaluate our financial results. Because our Catalyst Technologies segment includes our |
|
(b) |
Represents the amortization of the fair value adjustments associated with the equity affiliate investment in the Zeolyst Joint Venture as a result of the combination of the businesses of |
|
(c) |
When asset disposals occur, we remove the impact of net gain/loss of the disposed asset because such impact primarily reflects the non-cash write-off of long-lived assets no longer in use. |
|
(d) |
Reflects the exclusion of the foreign currency transaction gains and losses in the statements of income primarily related to the non-permanent intercompany debt denominated in local currency translated to |
|
(e) |
Represents non-cash adjustments to the Company’s LIFO reserves for certain inventories in the |
|
(f) |
Relates to certain transaction costs, including debt financing, due diligence and other costs related to transactions that are completed, pending or abandoned, that we believe are not representative of our ongoing business operations. |
|
(g) |
Includes the impact of restructuring, integration and business optimization expenses which are incremental costs that are not representative of our ongoing business operations. |
|
(h) |
Represents adjustments for defined benefit pension plan (benefit) costs in our statement of income. All of our defined benefit pension plan obligations are under defined benefit pension plans that are frozen. As such, we do not view such income or expenses as core to our ongoing business operations. |
|
(i) |
Other costs consist of certain expenses that are not core to our ongoing business operations, including environmental remediation-related costs, capital and franchise taxes. Included in this line-item are rounding discrepancies that may arise from rounding from dollars (in thousands) to dollars (in millions). |
Appendix Table A-2: Reconciliation of Net Income to Adjusted Net Income(1) |
||||||||||||||||||||||
|
|
Three months ended |
||||||||||||||||||||
|
|
2021 |
|
2020 |
||||||||||||||||||
|
|
Pre-tax |
|
Tax expense
|
|
After-tax |
|
Pre-tax |
|
Tax expense
|
|
After-tax |
||||||||||
|
|
(in millions) |
||||||||||||||||||||
Net income from continuing operations |
|
$ |
14.8 |
|
$ |
7.0 |
|
|
$ |
7.8 |
|
$ |
(1.1 |
) |
|
$ |
(47.1 |
) |
|
$ |
46.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Earnings per share: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic income per share - continuing operations |
|
|
|
|
|
$ |
0.06 |
|
|
|
|
|
$ |
0.34 |
|
|||||||
Diluted income per share - continuing operations |
|
|
|
|
|
$ |
0.06 |
|
|
|
|
|
$ |
0.34 |
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income from continuing operations |
|
|
14.8 |
|
|
7.0 |
|
|
|
7.8 |
|
|
(1.1 |
) |
|
|
(47.1 |
) |
|
|
46.0 |
|
Amortization of investment in affiliate step-up(b) |
|
|
1.6 |
|
|
0.2 |
|
|
|
1.4 |
|
|
1.7 |
|
|
|
(0.1 |
) |
|
|
1.8 |
|
Debt extinguishment costs |
|
|
— |
|
|
(0.9 |
) |
|
|
0.9 |
|
|
8.5 |
|
|
|
0.2 |
|
|
|
8.3 |
|
Net loss on asset disposals(c) |
|
|
1.1 |
|
|
0.1 |
|
|
|
1.0 |
|
|
3.5 |
|
|
|
0.7 |
|
|
|
2.8 |
|
Foreign currency exchange gain(d) |
|
|
— |
|
|
— |
|
|
|
— |
|
|
(4.7 |
) |
|
|
(0.4 |
) |
|
|
(4.3 |
) |
LIFO benefit(e) |
|
|
— |
|
|
— |
|
|
|
— |
|
|
(0.4 |
) |
|
|
0.4 |
|
|
|
(0.8 |
) |
Transaction and other related costs(f) |
|
|
0.4 |
|
|
(0.1 |
) |
|
|
0.5 |
|
|
(0.3 |
) |
|
|
(0.2 |
) |
|
|
(0.1 |
) |
Equity-based compensation |
|
|
9.0 |
|
|
1.3 |
|
|
|
7.7 |
|
|
3.9 |
|
|
|
(0.8 |
) |
|
|
4.7 |
|
Restructuring, integration and business optimization expenses(g) |
|
|
0.6 |
|
|
0.1 |
|
|
|
0.5 |
|
|
0.5 |
|
|
|
(0.1 |
) |
|
|
0.6 |
|
Defined benefit plan pension cost (benefit)(h) |
|
|
1.4 |
|
|
0.4 |
|
|
|
1.0 |
|
|
(0.1 |
) |
|
|
— |
|
|
|
(0.1 |
) |
Other(i) |
|
|
1.8 |
|
|
0.5 |
|
|
|
1.3 |
|
|
0.8 |
|
|
|
0.2 |
|
|
|
0.6 |
|
Adjusted net income, includes Impact of Discrete Tax Items |
|
|
30.7 |
|
|
8.6 |
|
|
|
22.1 |
|
|
12.3 |
|
|
|
(47.2 |
) |
|
|
59.5 |
|
Impact of Discrete Tax Items(2) |
|
|
— |
|
|
(0.8 |
) |
|
|
0.8 |
|
|
— |
|
|
|
(6.2 |
) |
|
|
6.2 |
|
Adjusted net income(1) |
|
$ |
30.7 |
|
$ |
7.8 |
|
|
$ |
22.9 |
|
$ |
12.3 |
|
|
$ |
(53.4 |
) |
|
$ |
65.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted net income per share: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic income per share |
|
|
|
|
|
$ |
0.17 |
|
|
|
|
|
$ |
0.49 |
|
|||||||
Diluted income per share |
|
|
|
|
|
$ |
0.17 |
|
|
|
|
|
$ |
0.48 |
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic |
|
|
|
|
|
|
136,256,601 |
|
|
|
|
|
|
135,406,081 |
|
|||||||
Diluted |
|
|
|
|
|
|
137,528,028 |
|
|
|
|
|
|
136,284,272 |
|
|||||||
See Appendix Table A-1 for Descriptions to Ecovyst Non-GAAP Reconciliations in the table above. |
|
|
Years ended |
||||||||||||||||||||||
|
|
2021 |
|
2020 |
||||||||||||||||||||
|
|
Pre-tax |
|
Tax expense
|
|
After-tax |
|
Pre-tax |
|
Tax expense
|
|
After-tax |
||||||||||||
|
|
(in millions) |
||||||||||||||||||||||
Net income from continuing operations |
|
$ |
13.9 |
|
|
$ |
12.1 |
|
|
$ |
1.8 |
|
|
$ |
2.2 |
|
|
$ |
(52.1 |
) |
|
$ |
54.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Earnings per share: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Basic income per share - continuing operations |
|
|
|
|
|
$ |
0.01 |
|
|
|
|
|
|
$ |
0.40 |
|
||||||||
Diluted income per share - continuing operations |
|
|
|
|
|
$ |
0.01 |
|
|
|
|
|
|
$ |
0.40 |
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income from continuing operations |
|
|
13.9 |
|
|
|
12.1 |
|
|
|
1.8 |
|
|
|
2.2 |
|
|
|
(52.1 |
) |
|
|
54.3 |
|
Amortization of investment in affiliate step-up(b) |
|
|
6.5 |
|
|
|
1.6 |
|
|
|
4.9 |
|
|
|
6.6 |
|
|
|
1.7 |
|
|
|
4.9 |
|
Debt extinguishment costs |
|
|
26.9 |
|
|
|
6.6 |
|
|
|
20.3 |
|
|
|
25.0 |
|
|
|
6.3 |
|
|
|
18.7 |
|
Net loss on asset disposals(c) |
|
|
5.7 |
|
|
|
1.4 |
|
|
|
4.3 |
|
|
|
4.7 |
|
|
|
1.2 |
|
|
|
3.5 |
|
Foreign currency exchange loss (gain)(d) |
|
|
4.7 |
|
|
|
1.0 |
|
|
|
3.7 |
|
|
|
(5.3 |
) |
|
|
(0.6 |
) |
|
|
(4.7 |
) |
LIFO benefit(e) |
|
|
(1.9 |
) |
|
|
(0.5 |
) |
|
|
(1.4 |
) |
|
|
(5.3 |
) |
|
|
(1.3 |
) |
|
|
(4.0 |
) |
Transaction and other related costs(f) |
|
|
2.0 |
|
|
|
0.5 |
|
|
|
1.5 |
|
|
|
1.1 |
|
|
|
0.3 |
|
|
|
0.8 |
|
Equity-based compensation |
|
|
31.8 |
|
|
|
7.7 |
|
|
|
24.1 |
|
|
|
17.2 |
|
|
|
4.0 |
|
|
|
13.2 |
|
Restructuring, integration and business optimization expenses(g) |
|
|
3.0 |
|
|
|
0.7 |
|
|
|
2.3 |
|
|
|
2.0 |
|
|
|
0.5 |
|
|
|
1.5 |
|
Defined benefit plan pension (benefit) cost(h) |
|
|
(0.9 |
) |
|
|
(0.2 |
) |
|
|
(0.7 |
) |
|
|
(0.6 |
) |
|
|
(0.2 |
) |
|
|
(0.4 |
) |
Other(i) |
|
|
3.6 |
|
|
|
0.9 |
|
|
|
2.7 |
|
|
|
3.0 |
|
|
|
0.7 |
|
|
|
2.3 |
|
Adjusted net income, includes Impact of Discrete Tax Items |
|
|
95.3 |
|
|
|
31.8 |
|
|
|
63.5 |
|
|
|
50.6 |
|
|
|
(39.5 |
) |
|
|
90.1 |
|
Impact of Discrete Tax Items(2) |
|
|
— |
|
|
|
(6.1 |
) |
|
|
6.1 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Adjusted net income(1) |
|
$ |
95.3 |
|
|
$ |
25.7 |
|
|
$ |
69.6 |
|
|
$ |
50.6 |
|
|
$ |
(39.5 |
) |
|
$ |
90.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Adjusted net income per share: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Basic income per share |
|
|
|
|
|
$ |
0.51 |
|
|
|
|
|
|
$ |
0.66 |
|
||||||||
Diluted income per share |
|
|
|
|
|
$ |
0.51 |
|
|
|
|
|
|
$ |
0.66 |
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Weighted average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Basic |
|
|
|
|
|
|
136,167,384 |
|
|
|
|
|
|
|
135,528,977 |
|
||||||||
Diluted |
|
|
|
|
|
|
137,708,931 |
|
|
|
|
|
|
|
136,450,953 |
|
(1) |
We define adjusted net income as net income attributable to |
|
(2) |
Represents intraperiod allocation rules related to a change in the |
Appendix Table A-3: Business Segment Sales and Adjusted EBITDA |
||||||||||||||||||||||
|
|
Three months ended
|
|
|
|
Years ended
|
|
|
||||||||||||||
|
|
2021 |
|
2020 |
|
% Change |
|
2021 |
|
2020 |
|
% Change |
||||||||||
|
|
|
||||||||||||||||||||
Sales: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
$ |
142.0 |
|
|
$ |
103.2 |
|
|
37.6 |
% |
|
$ |
500.5 |
|
|
$ |
401.9 |
|
|
24.5 |
% |
Silica Catalysts |
|
|
28.2 |
|
|
|
20.9 |
|
|
34.9 |
% |
|
|
110.7 |
|
|
|
94.0 |
|
|
17.8 |
% |
Total sales |
|
$ |
170.2 |
|
|
$ |
124.1 |
|
|
37.1 |
% |
|
$ |
611.2 |
|
|
$ |
495.9 |
|
|
23.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
$ |
36.3 |
|
|
$ |
28.9 |
|
|
25.6 |
% |
|
$ |
131.3 |
|
|
$ |
128.6 |
|
|
2.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
$ |
52.3 |
|
|
$ |
40.7 |
|
|
28.5 |
% |
|
$ |
177.7 |
|
|
$ |
157.2 |
|
|
13.0 |
% |
Catalyst Technologies |
|
|
23.4 |
|
|
|
14.8 |
|
|
58.1 |
% |
|
|
88.0 |
|
|
|
74.5 |
|
|
18.1 |
% |
Unallocated corporate expense |
|
|
(12.5 |
) |
|
|
(9.6 |
) |
|
30.2 |
% |
|
|
(38.1 |
) |
|
|
(39.1 |
) |
|
(2.6 |
)% |
Total Adjusted EBITDA |
|
$ |
63.2 |
|
|
$ |
45.9 |
|
|
37.7 |
% |
|
$ |
227.6 |
|
|
$ |
192.6 |
|
|
18.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA Margin: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
36.8 |
% |
|
|
39.4 |
% |
|
|
|
|
35.5 |
% |
|
|
39.1 |
% |
|
|
||
Catalysts Technologies(1) |
|
|
36.3 |
% |
|
|
29.7 |
% |
|
|
|
|
36.4 |
% |
|
|
33.5 |
% |
|
|
||
Total Adjusted EBITDA Margin(1) |
|
|
30.6 |
% |
|
|
30.0 |
% |
|
|
|
|
30.7 |
% |
|
|
30.8 |
% |
|
|
(1) |
Adjusted EBITDA margin calculation includes proportionate |
Appendix Table A-4: Adjusted Free Cash Flow |
||||||||
|
|
Years ended
|
||||||
|
|
2021 |
|
2020 |
||||
|
|
(in millions) |
||||||
Net cash provided by operating activities, continuing operations |
|
$ |
137.3 |
|
|
$ |
140.1 |
|
Net cash (used in) provided by operating activities, discontinued operations |
|
|
(7.4 |
) |
|
|
83.5 |
|
Net cash provided by operating activities |
|
|
129.9 |
|
|
|
223.6 |
|
|
|
|
|
|
||||
Less: |
|
|
|
|
||||
Purchases of property, plant and equipment, continuing operations |
|
|
(60.0 |
) |
|
|
(54.8 |
) |
Purchases of property, plant and equipment, discontinued operations |
|
|
(31.0 |
) |
|
|
(54.8 |
) |
Purchases of property, plant and equipment(1) |
|
|
(91.0 |
) |
|
|
(109.6 |
) |
|
|
|
|
|
||||
Free cash flow |
|
|
38.9 |
|
|
|
114.0 |
|
|
|
|
|
|
||||
Adjustments to free cash flow: |
|
|
|
|
||||
Proceeds from sale of assets |
|
|
0.3 |
|
|
|
11.1 |
|
Net interest proceeds on currency swaps |
|
|
2.3 |
|
|
|
5.0 |
|
Cash paid for costs related to segment disposals |
|
|
46.0 |
|
|
|
22.5 |
|
Cash paid for debt financing costs included in cash from operating activities |
|
|
5.7 |
|
|
|
— |
|
|
|
|
|
|
||||
Adjusted free cash flow(2) |
|
$ |
93.2 |
|
|
$ |
152.5 |
|
|
|
|
|
|
||||
Net cash provided by investing activities(3) |
|
$ |
835.7 |
|
|
$ |
551.5 |
|
Net cash used in financing activities |
|
$ |
(964.2 |
) |
|
$ |
(722.8 |
) |
(1) |
Excludes the Company’s proportionate |
|
(2) |
We define adjusted free cash flow as net cash provided by operating activities less purchases of property, plant and equipment, adjusted for proceeds from sale of assets and net interest proceeds on swaps designated as net investment hedges and the cash paid for costs related to segment disposals. Adjusted free cash flow is a non-GAAP financial measure that we believe will enhance a prospective investor’s understanding of our ability to generate additional cash from operations, including the reduction in cash paid for interest related to our cross-currency interest rate swaps, and is an important financial measure for use in evaluating our financial performance. Our presentation of adjusted free cash flow is not intended to replace, and should not be considered superior to, the presentation of our net cash provided by operating activities determined in accordance with GAAP. Additionally, our definition of adjusted free cash flow is limited, in that it does not represent residual cash flows available for discretionary expenditures, due to the fact that the measure does not deduct the payments required for debt service and other contractual obligations or payments made for business acquisitions. Therefore, we believe it is important to view adjusted free cash flow as a measure that provides supplemental information to our consolidated statements of cash flows. |
|
(3) |
Net cash used in investing activities includes purchases of property, plant and equipment, proceeds from sale of assets, and net interest proceeds on swaps designated as net investment hedges, which are also included in our computation of adjusted free cash flow. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20220225005108/en/
Investor Contact:
(484) 617-1225
Chris.Evans@ecovyst.com
General Investor Inquiries:
InvestorRelations@ecovyst.com
Source:
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