MALVERN, PA — Ecovyst Inc. (NYSE: ECVT) has disclosed its financial results for the third quarter ending September 30, 2023, and adjusted its full-year guidance in light of current business trends and conditions.
The company now expects its 2023 sales to be between $675 million and $705 million, a slight adjustment from the previously projected range of $685 million to $715 million. Its proportionate 50% share of the Zeolyst Joint Venture is expected to bring in sales of $150 million to $160 million, down from the earlier estimate of $155 million to $165 million. The company’s adjusted EBITDA2 remains unchanged at approximately $260 million, while the adjusted free cash flow2 is now expected to be between $70 million and $80 million, marking a decrease from the earlier projection of $100 million to $115 million.
In Q3 2023, Ecovyst reported sales of $173.3 million, a decrease compared to $232.5 million in the same quarter of the previous year. This drop is attributed to the pricing pass-through impact of lower sulfur costs of approximately $39 million, coupled with decreased sales volume related to lower end-use demand and destocking in nylon intermediates for virgin sulfuric acid and polyethylene for silica catalysts.
The company posted a net income of $16.6 million, as opposed to the $21.3 million net income in the year-ago quarter. The adjusted net income stood at $22.2 million, with an adjusted diluted earnings per share of $0.19. The company also announced an expansion of silica catalyst production capacity in its Kansas City, KS facility, bolstered by additional long-term customer commitments.
Ecovyst’s CEO, Kurt J. Bitting, expressed satisfaction with the company’s Q3 2023 results, given the challenging macroeconomic environment. Bitting noted that the results reflected stable demand fundamentals and positive pricing across most end-use sectors. He said, “High refinery utilization during the quarter continued to provide support for regeneration demand.” However, he also acknowledged lower sales volume for virgin sulfuric acid and polyethylene catalysts compared to Q3 2022 levels due to decreased end-use demand and higher manufacturing costs.
Despite these challenges, Bitting highlighted the company’s overall profitability, pointing to an adjusted EBITDA margin of 32.3% for Q3 2023, up 330 basis points from Q3 2022. He stated, “Of note, overall profitability remained favorable, as evidenced by a third quarter Adjusted EBITDA margin of 32.3% that was up 330 basis points compared to the third quarter of 2022.”
The company also repurchased 541,494 shares at an average price of $9.85, costing a total of $5.3 million. This move indicates Ecovyst’s confidence in its financial stability and future growth potential, further solidifying its position as a robust player in the market.
In summary, despite facing a challenging macroeconomic environment, Ecovyst Inc. has demonstrated resilience in Q3 2023. The company’s focus on maximizing profitability and expanding production capacity underscores its strategic approach to navigating the evolving business landscape.
Additional details can be found on Ecovyst’s website here.
For the latest news on everything happening in Chester County and the surrounding area, be sure to follow MyChesCo on Google News and MSN.