AdvanSix Inc. — Call Transcript 2026

Good day, welcome to the AdvanSix first quarter 2026 earnings conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your touchtone phone. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Adam Kressel, Vice President, Investor Relations and Treasurer. Please go ahead. Thank you, Danielle. Good morning, and welcome to AdvanSix's first quarter 2026 earnings conference call. With me here today are President and Chief Executive Officer, Erin Kane, Senior Vice President and CFO, Patrick Day, and Vice President of Corporate Finance and Strategic FP&A, Chris Gramm. This call and webcast, including any non-GAAP reconciliations, are available on our website at investors.advansix.com. Note that elements of this presentation contain forward-looking statements that are based on our best view of the world and of our business as we see it today. Those elements can change, the actual results could differ materially from those projected, and we ask that you consider them in that light. We refer you to the forward-looking statements included in our press release and earnings presentation. In addition, we identify the principal risks and uncertainties that affect our performance in our SEC filings, including our Annual Report on Form 10-K, as further updated in subsequent filings with the SEC. This morning, we will review our financial results for the first quarter 2026 and share our outlook for our key product lines and end markets. Finally, we'll leave time for your questions at the end. With that, I'll turn the call over to AdvanSix's President and Chief Executive Officer, Erin Kane. Thanks, Adam, good morning, everyone. We appreciate you joining us here today for our quarterly call. As you saw in our press release, the AdvanSix team navigated a number of headwinds to deliver a solid first quarter performance, including the earlier winter storm-related impacts and new geopolitical challenges amid continued subdued industrial end market demand. In the quarter, we generated 7% sales growth year-over-year, supported by improvements in chemical intermediates volume and plant nutrients market pricing, partially offsetting the margin impacts driven by increased sulfur and natural gas costs. We are executing with a focus to recover inflationary raw material input costs by leveraging both our pass-through formula and freely negotiated pricing mechanisms. I'd like to thank all of our teammates who contributed to successfully maintaining safe operations during the winter storm earlier this year. While the earnings impact related to this event came in just above the high end of our anticipated range, we were able to save $3 million of planned turnaround expense for the year. Looking ahead, we anticipate significant sequential earnings and cash flow improvement into the second quarter. We are in a solid position as the domestic planting season progresses and continue to operate amid a tightening acetone global supply and demand environment and a modestly recovering nylon industry. We're maintaining a disciplined focus on cost productivity, capital spending, turnaround execution, and full-year free cash flow generation. We continue to expect full-year CapEx in the range of $75 million-$95 million with targeted allocation of nearly 20% of that towards high return growth investments. We also continue to expect debt leverage ratios near the low end of our target range of 1x to 2.5x by the end of this year. Key to our strategy is a keen focus on controllable levers to support through cycle profitability and cash conversion while progressing targeted growth strategies and initiatives. We announced yesterday an exciting new opportunity to expand our integrated ammonia platform at our Hopewell, Virginia site to supply the growing regional diesel exhaust fluid or DEF market. I'll share more about this later in the call. Lastly, effective April 27th, we welcome Patrick Day as our new Senior Vice President and Chief Financial Officer. Pat has tremendous experience establishing corporate and financial strategies that accelerate growth and shareholder value. We look forward to his expertise as we advance in our next chapter. I'd like to also give thanks to Chris Gramm for his commitment and support during his time as Interim CFO over the last year. With that, I'll turn it to Chris to discuss the financials. Thanks, Erin. I'm now on Slide 4 to discuss our results for the quarter. Sales of $404 million in the quarter increased approximately 7% versus the prior year, comprised of 6% volume growth and 1% favorable price. Sales volume growth was primarily driven by favorable chemical intermediate sales. Market-based pricing improved by 3%, primarily driven by an increase in plant nutrients, reflecting higher nitrogen pricing amid increased sulfur input costs. Raw material pass-through pricing was down 2% following a net cost decrease in benzene and propylene, which is a major input to cumene, our largest raw material and key feedstock to our products. Adjusted EBITDA was $5 million, down $47 million from last year. This was primarily driven by the absence of insurance proceeds from the prior year of $26 million, the unfavorable impact of higher sulfur and natural gas raw material prices, higher utility expenses, and $11 million of winter storm-related impacts. On a sequential basis compared to the fourth quarter, higher sales volume growth supported by improved operational performance was more than offset by escalating raw material input prices. From a free cash flow perspective, the first quarter represents a seasonal use of cash as expected, primarily due to the timing of cash payments for CapEx following the prior quarter outages. The absence of insurance proceeds was also a meaningful driver of the year-over-year change. We continue to anticipate sequential improvement into the second quarter and expect the second half of the year to be a source of cash to achieve our full year expectations. Let's turn to Slide five. On this slide, we are detailing our quarterly sales contributions by product line, as well as price and volume indicators, both year-over-year and sequentially. In light of the significant raw material inflation and the mix of our formula or index-based pricing mechanisms, we did not fully cover those costs in the first quarter. However, we anticipate recouping a large portion of that shortfall in the second quarter, particularly into the heart of the domestic planting season for plant nutrients. Starting with Nylon solutions, resin volumes improved sequentially on improved operational performance, while caprolactam volumes moderated in a soft demand environment, particularly for carpet applications. We saw a higher export mix in the first quarter of 2026, which is expected to continue in the near term. With our advantage position, we are evaluating export opportunities to ensure the best economic output for the integrated enterprise. Domestic pricing steadily increased overall, supported in part by higher input costs. Plant nutrient volumes were flat to down both year-over-year and sequentially in the first quarter, while pricing strength continued. In the early parts of the year, we witnessed more cautious buying behavior down the value chain and a more risk-averse sentiment from customers amid the higher input costs and rapidly rising nitrogen prices. Lastly, chemical intermediate sales improved on the back of volume improvements year-over-year. In acetone, as we mentioned on the first quarter 2025 earnings call, downstream MMA saw extended plant outages last year. In the first quarter of 2026, we observed more normalized operating rates down the value chain supporting demand. In addition, given pricing dynamics and trade flows across our key products in this portfolio, we delivered on opportunistic spot sales domestically and in the export markets. Thanks, Chris. I'm now on Slide six to discuss what we're seeing across our major product lines. Our diversified end market exposure continues to be a strategic advantage, providing resilience across cycles. Agricultural and fertilizer remains our largest end market. As we sit here today, our domestic granular sales for this fertilizer year are now expected to be near record levels, but closer to flat as compared to the last fertilizer year. While the fertilizer year started off with optimism and a strong fall fill, as we've discussed in previous calls, buying has become more cautious given continued challenged fundamentals, including farmer profitability and input affordability, cold weather to start the spring, and drought conditions. What that means is we are now selling in-season tons with the ability to work coverage of sulfur input costs, which is important because amid a higher global nitrogen pricing environment on the heels of the conflict in the Middle East, our ammonium sulfate pricing actions are largely offsetting sulfur input costs rather than driving margin expansion in this current context. We know that growers value the cost of nutrition. In fact, ammonia for direct application is currently a relatively attractive value for growers. While we are not a large merchant ammonia supplier, we have seen good demand and netbacks and have been maximizing our ammonia availability this spring, while slightly moderating ammonium sulfate production. While we capture the benefit from the advantage between U.S. natural gas and global nitrogen prices, we also contend with the impact of sulfur input costs versus the sulfur value proposition we deliver to farmers. On tightened global supply, sulfur quarterly prices settled at a record $655 per long ton in the 2Q 2026, with the current spot prices trading even higher than those levels. That represents over 30% sequential increase and a roughly 140% surge year-over-year, so a meaningful increase that the industry is experiencing. Moving to our key nylon end markets across building and construction as well as engineering plastics, North American demand has not materially changed. Global pricing has moved up with capacity rationalization and raw material shortages in Europe, lower operating rates in China, logistics constraints, and higher input costs. Our industry pricing mechanisms work to pass through changes in core raw materials, notably benzene, but also natural gas and sulfur. Given global trade flow dynamics, reduced imports have created opportunities to gain share. In this environment, it is critical for our business to remain agile through pricing and mix. We continue to execute our plan, including taking advantage of export opportunities as they arise, increasing prices to offset cost increases, and reducing inventory levels for the nylon resin to align with our current market conditions. In chemical intermediates, phenol demand remains soft overall, driving lower global operating rates, coupled with reduced acetone imports into the U.S., all of which are supporting tightening acetone supply and demand dynamics. Acetone price increases have been implemented in the industry to keep pace with rising propylene costs. Spreads have held near cycle averages, and we continue that continue to anticipate that for the full-year of 2026. Let's move to Slide seven. We were excited to announce yesterday that we have entered into a process design and licensing agreement to assess expansion of our integrated ammonia platform to enable the domestic manufacturing of DEF, a critical emissions control product used across on and off-highway diesel applications. As background, DEF is an EPA mandated additive for reducing NOx emissions from diesel engines, with strong and growing demand driven primarily by Class 8 vehicle usage in the Mid-Atlantic and Northeast. Demand for DEF continues to grow to meet environmental standards and as regulatory requirements expand across transportation, construction, agriculture, and industrial equipment fleets. The AdvanSix Hopewell facility provides a strong foundation for expanding domestic manufacturing at this site and already produces all required DEF inputs. This potential expansion would complement existing manufacturing capabilities at the site with full continued commitment to the production of ammonium sulfate fertilizer to serve the U.S. farming industry. Our geographic position uniquely enables reliable supply to meet growing demand in a market currently served by imports and production from other domestic regions. Our investments over time with our ammonia unit operations have paid off in terms of our reliability and output. This project has the potential to unlock further value from our existing assets through increased optionality to serve a broadened customer base. We will advance through detailed engineering and development phases with final investment decision targeted for the first half of 2027. Additional updates will be provided as engineering, commercial, and financial milestones are achieved and regulatory approvals are secured. We anticipate a multiyear capital investment supporting attractive financial returns following expected operational startup in 2029, which align with our long-term value creation objectives and commitment to disciplined capital allocation. Let's turn to Slide eight before moving to Q&A. AdvanSix offers a compelling investment thesis with value drivers supporting through cycle profitability and sustainable performance. Our strategic initiatives, unique combination of assets and business model are core to our durable competitive advantage and long-term positioning. Our global low-cost position and vertically integrated caprolactam production serves us well. Ammonia and sulfuric acid platform integration, coupled with a leading technology position, underpins how we win in plant nutrients. We are progressing our SUSTAIN ammonium sulfate growth program and have now announced another high return investment opportunity to serve the growing DEF market. These capabilities, combined with increasing asset operational agility and diversified product and end market mix, position us to navigate cycles and capitalize on emerging opportunities. We remain focused on delivering on controllable levers, including our non-manpower fixed cost savings program, risk-based prioritization of our capital investments, continued working capital discipline, and 45Q carbon capture tax credits to support improved cash flow generation. With that, Adam, let's move to Q&A. Thanks, Erin. Danielle, can you please open the line for questions? Thank you. We will now begin the question-and-answer session. To ask a question, you may press star then one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. The first question comes from Pete Osterland from Truist Securities. Please go ahead. Hey, good morning. Thanks for taking the questions. Just wanted to start on the DEF ammonia project. I guess, do you have a rough estimate you can share for the capital intensity you expect for this project between now and 2029? You know, maybe how does the return hurdle you're targeting at this point compare to other programs you've had, like SUSTAIN and the IRRs you've referenced there? Thanks, Pete. Good morning, appreciate the question. At this time, you know, I would share that we would expect the CapEx for this program, you know, certainly to be larger than our SUSTAIN program. Hopefully, you can appreciate that while, you know, we're investigating and doing our FEED process, you know, we are having a number of negotiations with folks and, you know, at this time would keep, you know, the actual CapEx range, you know, a bit confidential and more to come there. You can think about it certainly as a larger program than SUSTAIN. That said, our internal, you know, targets as we've shared for high return growth and cost savings projects, you know, are a 20%+ IRR, you know, hurdle rates. You know, this project fits, you know, well into that range. You know, we're here today and certainly announcing it yesterday, you know, given the fact that this continues to, you know, demonstrate real great potential for the company. Very helpful. Thanks. You know, kind of switching gears, I guess, just when you think about the level of sulfur pricing that you're guiding to for the second quarter, I mean, is it your expectation at this point that prices should be at or above that level for the remainder of the year? I mean, you know, even if the Iran conflict ended very soon, I guess how long would you expect at this point until you start seeing some easing, for the dynamics that are driving higher prices in that market? I mean, certainly, you're probably aware that spot prices continue to, you know, trade higher than the Q2 settlement. You know, certainly, as we think about the Q3 settlement, that will come in a couple of months, right? It's settled by two large phosphate, you know, producers here in the U.S., and they're our three largest suppliers. I think consistent with what you're probably hearing with others in this space, even if things were to, you know, we have a resolution in the Middle East, there is quite a bit of time, certainly for things to settle back out. You know, I would share that security of supply is not a consideration for us. You know, being that we're buying here in North America. You know, certainly there is a lot of sulfur, 50% or so world, you know, supply comes from the Middle East. You know, we're in a great spot being a North American producer and purchaser, you know, here. You know, certainly we would anticipate now that it's hard to predict, but pricing probably does stay a bit, you know, higher for longer. We'll have to see what, you know, really it does for demand, you know, into its largest applications, right? Just over 50% of the world's sulfur goes into phosphate fertilizer. Watching that will be key compared to, you know, what we see. We feel good about, you know, certainly our sequential opportunity to, you know, recover, and that's been our focus, you know, really as we are progressing, you know, now in Q2 as we move forward. All right. Very helpful. Thank you, Erin. Yeah. The next question comes from David Silver from Freedom Capital Markets. Please go ahead. Yeah, hi. Thank you. Let me just get my questions in order here. You know, I did want to go back to maybe the sulfur question and a couple of your comments regarding ammonium sulfate. You know, I think you mentioned that ammonium sulfate prices are increasing, but, you know, more or less in line with the rise in sulfur costs. You know, I'm just wondering, you know, you talked about kind of balanced markets, whereas, I mean, for most nitrogen fertilizer products, it's, you know, somewhat different supply-demand aspect. It's very tight. You know, you do have a very strong vertically integrated production structure. Just wondering what kind of in-season flexibility you think you have to maybe exploit, you know, some pretty big, you know, some pretty big, I don't know, price differentials amongst the different nitrogen fertilizer products? You know, you've looked at these markets for quite a while. You know, why not tilt or lean on, you know, direct ammonia sales and a little bit less of the ammonium sulfate here? No, thanks for that question, Dave. Certainly, you know, hopefully that was, you know, teased out a bit in our remarks. You know, we are, you know, a big producer and a leader in ammonium sulfate, and that is certainly, you know, a place here. As you say, you know, with ammonium sulfate, we are and do, you know, get that differential certainly between, you know, where nitrogen is priced in our U.S. natural gas position. We also can have that directly in our ammonia sales as well. I would say right now it's a moderate lever, right? You know, certainly, you know, we are and can pull back a bit right onto our ammonium sulfate production. We continue, as we shared last year, you know, produce ammonia at, you know, historically high levels and then certainly relative to what we are, you know, targeting to sell would be consistent with that. You know, again, farmers need NPK, they need S, right? There is a value proposition for sulfur and, you know, we continue to focus on ensuring that, you know, they have their needs met there as well. Certainly a little bit different than perhaps historical when, you know, nitrogen has moved and you have the, you know, the spread. This situation right now, you know, compared to perhaps, you know, Ukraine and Russia definitely continues to, you know, just have us, you know, contend with the sulfur. Certainly farmers do seem to be sticking more with N, and you know, we're looking to take advantage of that to and really, you know, provide the opportunity that we have off our assets to do so. Okay. Just to, I'm gonna follow-up with a couple of, you know, targeted questions. Firstly, you know, you did talk about the sulfur market, you did talk about your positioning, you know, able to get all the sulfur that you require. There is, I don't know, I'm guessing it's unprecedented, but there is this gap that you touched on between the spot price of sulfur and the contract price of sulfur. You know, I just wanted to clarify that AdvanSix is able to purchase at the contract price, you know, the lower contract price, you know, under your current supply agreements and rather than, you know, some mix of contract and spot pricing. Just if you could just kinda touch on, you know, your supply arrangements for sulfur, and in particular, you know, how tight is the relationship between the, you know, the U.S. contract price versus having to, you know, go out into the spot market? I can confirm that we purchase entirely on the contract market. Okay, great. Thank you for that. I did want to follow up maybe on the DEF project, you know, very interesting, you know, project and leveraging, you know, some of that, some of your capabilities. You know, I read the release the other day, then I read your comments in the prepared remarks. You know, certainly you're going to be adding some urea melt capacity there. Will you also be debottlenecking ammonia? You know, in other words, are you going to have a higher ammonia capacity, you know, once the project is all finished than you currently have? You know, how should I just kind of think about that in terms of allocating ammonia amongst, you know, the nylon, the fertilizer, and now the DEF? Certainly this next phase does not, you know, this project doesn't require, excuse me, an ammonia expansion. You know, certainly given our geographical location, our integrated platform, you know, we always look at marginal ammonia de-bottlenecks. For the DEF, we do not need to expand ammonia for the purposes of the project. Okay, very good. Last one from me, I would like to just get an update on the Section 45Q credits. You did talk about it, I'm guessing that the file of the 2025 filings for roughly $20 million that has not been received yet. Just kind of an update on that, what do, you know, do you anticipate filing for an additional, you know, tranche of the credits to which you're entitled in the current fiscal year? You know, should we think about that maybe in the $20 million range as well? Yeah. David, thanks for, thanks for that question. As you can imagine, there's been a lot of continuing activity around 45Q. We are have the audit process underway with the IRS for the 2018 through the 2020 years of credits. We anticipate field work being wrapped up in the second quarter. We're making good progress on the audit itself. In terms of the timing of the cash, while $20 million was the sort of full value, we've already received two of that in prior years, we're anticipating another 18. We would expect the proceeds for that in the second half, subject to the IRS approval process. We're expecting that in the second half. In terms of the life cycle assessment for the 2021 year and following, we've submitted those to the DOE, and we're working now with the DOE and the IRS to get those certified. Just as a reminder, we've been at this for over five years, this process just takes some time as we work through with the government to get their approval and the due diligence that they do. Hopefully, those will be coming shortly. That's the process and where we are so Okay, great. Thank you for the update. Thanks. Thanks, David. This concludes our question-and-answer session. I would like to turn the conference back over to Erin Kane for closing remarks. Thank you all again for your time and interest this morning. As we move through the remainder of 2026 and navigate a dynamic environment, we are well-positioned to support our strategic priorities as a U.S.-based integrated manufacturer aligned to domestic supply chains and energy markets, as well as a diverse set of end market applications. With that, we look forward to speaking with you again next quarter. Stay safe and be well. The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.

Speaker 5: Good day, welcome to the AdvanSix first quarter 2026 earnings conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your touchtone phone. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Adam Kressel, Vice President, Investor Relations and Treasurer. Please go ahead. Good day, welcome to the AdvanSix first quarter 2026 earnings conference call. good day welcome to the advansix first quarter 2026 earnings conference call All participants will be in a listen-only mode. all participants will be in a listen-only mode Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. should you need assistance please signal a conference specialist by pressing the star key followed by zero After today's presentation, there will be an opportunity to ask questions. after today's presentation there will be an opportunity to ask questions To ask a question, you may press star then one on your touchtone phone. to ask a question you may press star then one on your touchtone phone To withdraw your question, please press star then two. to withdraw your question please press star then two Please note this event is being recorded. please note this event is being recorded I would now like to turn the conference over to Adam Kressel, Vice President, Investor Relations and Treasurer. i would now like to turn the conference over to adam kressel vice president investor relations and treasurer Please go ahead. please go ahead

Speaker 1: Thank you, Danielle. Good morning, and welcome to AdvanSix's first quarter 2026 earnings conference call. With me here today are President and Chief Executive Officer, Erin Kane, Senior Vice President and CFO, Patrick Day, and Vice President of Corporate Finance and Strategic FP&A, Chris Gramm. This call and webcast, including any non-GAAP reconciliations, are available on our website at investors.advansix.com. Note that elements of this presentation contain forward-looking statements that are based on our best view of the world and of our business as we see it today. Those elements can change, the actual results could differ materially from those projected, and we ask that you consider them in that light. We refer you to the forward-looking statements included in our press release and earnings presentation. Thank you, Danielle. thank you danielle Good morning, and welcome to AdvanSix's first quarter 2026 earnings conference call. good morning and welcome to advansix's first quarter 2026 earnings conference call With me here today are President and Chief Executive Officer, Erin Kane, Senior Vice President and CFO, Patrick Day, and Vice President of Corporate Finance and Strategic FP&A, Chris Gramm. with me here today are president and chief executive officer erin kane senior vice president and cfo patrick day and vice president of corporate finance and strategic fp&a chris gramm This call and webcast, including any non-GAAP reconciliations, are available on our website at investors.advansix.com. this call and webcast including any non-gaap reconciliations are available on our website at investors.advansix.com Note that elements of this presentation contain forward-looking statements that are based on our best view of the world and of our business as we see it today. note that elements of this presentation contain forward-looking statements that are based on our best view of the world and of our business as we see it today Those elements can change, the actual results could differ materially from those projected, and we ask that you consider them in that light. those elements can change the actual results could differ materially from those projected and we ask that you consider them in that light We refer you to the forward-looking statements included in our press release and earnings presentation. we refer you to the forward-looking statements included in our press release and earnings presentation In addition, we identify the principal risks and uncertainties that affect our performance in our SEC filings, including our Annual Report on Form 10-K, as further updated in subsequent filings with the SEC. This morning, we will review our financial results for the first quarter 2026 and share our outlook for our key product lines and end markets. Finally, we'll leave time for your questions at the end. With that, I'll turn the call over to AdvanSix's President and Chief Executive Officer, Erin Kane. In addition, we identify the principal risks and uncertainties that affect our performance in our SEC filings, including our Annual Report on Form 10-K, as further updated in subsequent filings with the SEC. in addition we identify the principal risks and uncertainties that affect our performance in our sec filings including our annual report on form 10-k as further updated in subsequent filings with the sec This morning, we will review our financial results for the first quarter 2026 and share our outlook for our key product lines and end markets. this morning we will review our financial results for the first quarter 2026 and share our outlook for our key product lines and end markets Finally, we'll leave time for your questions at the end. finally we'll leave time for your questions at the end With that, I'll turn the call over to AdvanSix's President and Chief Executive Officer, Erin Kane. with that i'll turn the call over to advansix's president and chief executive officer erin kane

Speaker 4: Thanks, Adam, good morning, everyone. We appreciate you joining us here today for our quarterly call. As you saw in our press release, the AdvanSix team navigated a number of headwinds to deliver a solid first quarter performance, including the earlier winter storm-related impacts and new geopolitical challenges amid continued subdued industrial end market demand. In the quarter, we generated 7% sales growth year-over-year, supported by improvements in chemical intermediates volume and plant nutrients market pricing, partially offsetting the margin impacts driven by increased sulfur and natural gas costs. We are executing with a focus to recover inflationary raw material input costs by leveraging both our pass-through formula and freely negotiated pricing mechanisms. I'd like to thank all of our teammates who contributed to successfully maintaining safe operations during the winter storm earlier this year. Thanks, Adam, good morning, everyone. thanks adam good morning everyone We appreciate you joining us here today for our quarterly call. we appreciate you joining us here today for our quarterly call As you saw in our press release, the AdvanSix team navigated a number of headwinds to deliver a solid first quarter performance, including the earlier winter storm-related impacts and new geopolitical challenges amid continued subdued industrial end market demand. as you saw in our press release the advansix team navigated a number of headwinds to deliver a solid first quarter performance including the earlier winter storm-related impacts and new geopolitical challenges amid continued subdued industrial end market demand In the quarter, we generated 7% sales growth year-over-year, supported by improvements in chemical intermediates volume and plant nutrients market pricing, partially offsetting the margin impacts driven by increased sulfur and natural gas costs. in the quarter we generated 7% sales growth year-over-year supported by improvements in chemical intermediates volume and plant nutrients market pricing partially offsetting the margin impacts driven by increased sulfur and natural gas costs We are executing with a focus to recover inflationary raw material input costs by leveraging both our pass-through formula and freely negotiated pricing mechanisms. we are executing with a focus to recover inflationary raw material input costs by leveraging both our pass-through formula and freely negotiated pricing mechanisms I'd like to thank all of our teammates who contributed to successfully maintaining safe operations during the winter storm earlier this year. i'd like to thank all of our teammates who contributed to successfully maintaining safe operations during the winter storm earlier this year While the earnings impact related to this event came in just above the high end of our anticipated range, we were able to save $3 million of planned turnaround expense for the year. Looking ahead, we anticipate significant sequential earnings and cash flow improvement into the second quarter. We are in a solid position as the domestic planting season progresses and continue to operate amid a tightening acetone global supply and demand environment and a modestly recovering nylon industry. We're maintaining a disciplined focus on cost productivity, capital spending, turnaround execution, and full-year free cash flow generation. We continue to expect full-year CapEx in the range of $75 million-$95 million with targeted allocation of nearly 20% of that towards high return growth investments. While the earnings impact related to this event came in just above the high end of our anticipated range, we were able to save $3 million of planned turnaround expense for the year. while the earnings impact related to this event came in just above the high end of our anticipated range we were able to save $3 million of planned turnaround expense for the year Looking ahead, we anticipate significant sequential earnings and cash flow improvement into the second quarter. looking ahead we anticipate significant sequential earnings and cash flow improvement into the second quarter We are in a solid position as the domestic planting season progresses and continue to operate amid a tightening acetone global supply and demand environment and a modestly recovering nylon industry. we are in a solid position as the domestic planting season progresses and continue to operate amid a tightening acetone global supply and demand environment and a modestly recovering nylon industry We're maintaining a disciplined focus on cost productivity, capital spending, turnaround execution, and full- year free cash flow generation. we're maintaining a disciplined focus on cost productivity capital spending turnaround execution and full- year free cash flow generation We continue to expect full- year CapEx in the range of $75 million-$95 million with targeted allocation of nearly 20% of that towards high return growth investments. we continue to expect full- year capex in the range of $75 million-$95 million with targeted allocation of nearly 20% of that towards high return growth investments We also continue to expect debt leverage ratios near the low end of our target range of 1x to 2.5x by the end of this year. Key to our strategy is a keen focus on controllable levers to support through cycle profitability and cash conversion while progressing targeted growth strategies and initiatives. We announced yesterday an exciting new opportunity to expand our integrated ammonia platform at our Hopewell, Virginia site to supply the growing regional diesel exhaust fluid or DEF market. I'll share more about this later in the call. Lastly, effective April 27th, we welcome Patrick Day as our new Senior Vice President and Chief Financial Officer. Pat has tremendous experience establishing corporate and financial strategies that accelerate growth and shareholder value. We look forward to his expertise as we advance in our next chapter. We also continue to expect debt leverage ratios near the low end of our target range of 1x to 2.5x by the end of this year. we also continue to expect debt leverage ratios near the low end of our target range of 1x to 2.5x by the end of this year Key to our strategy is a keen focus on controllable levers to support through cycle profitability and cash conversion while progressing targeted growth strategies and initiatives. key to our strategy is a keen focus on controllable levers to support through cycle profitability and cash conversion while progressing targeted growth strategies and initiatives We announced yesterday an exciting new opportunity to expand our integrated ammonia platform at our Hopewell, Virginia site to supply the growing regional diesel exhaust fluid or DEF market. we announced yesterday an exciting new opportunity to expand our integrated ammonia platform at our hopewell virginia site to supply the growing regional diesel exhaust fluid or def market I'll share more about this later in the call. i'll share more about this later in the call Lastly, effective April 27th, we welcome Patrick Day as our new Senior Vice President and Chief Financial Officer. lastly effective april 27th we welcome patrick day as our new senior vice president and chief financial officer Pat has tremendous experience establishing corporate and financial strategies that accelerate growth and shareholder value. pat has tremendous experience establishing corporate and financial strategies that accelerate growth and shareholder value We look forward to his expertise as we advance in our next chapter. we look forward to his expertise as we advance in our next chapter I'd like to also give thanks to Chris Gramm for his commitment and support during his time as Interim CFO over the last year. With that, I'll turn it to Chris to discuss the financials. I'd like to also give thanks to Chris Gramm for his commitment and support during his time as Interim CFO over the last year. i'd like to also give thanks to chris gramm for his commitment and support during his time as interim cfo over the last year With that, I'll turn it to Chris to discuss the financials. with that i'll turn it to chris to discuss the financials

Speaker 2: Thanks, Erin. I'm now on Slide 4 to discuss our results for the quarter. Sales of $404 million in the quarter increased approximately 7% versus the prior year, comprised of 6% volume growth and 1% favorable price. Sales volume growth was primarily driven by favorable chemical intermediate sales. Market-based pricing improved by 3%, primarily driven by an increase in plant nutrients, reflecting higher nitrogen pricing amid increased sulfur input costs. Raw material pass-through pricing was down 2% following a net cost decrease in benzene and propylene, which is a major input to cumene, our largest raw material and key feedstock to our products. Adjusted EBITDA was $5 million, down $47 million from last year. Thanks, Erin. thanks erin I'm now on Slide 4 to discuss our results for the quarter. i'm now on slide 4 to discuss our results for the quarter Sales of $404 million in the quarter increased approximately 7% versus the prior year, comprised of 6% volume growth and 1% favorable price. sales of $404 million in the quarter increased approximately 7% versus the prior year comprised of 6% volume growth and 1% favorable price Sales volume growth was primarily driven by favorable chemical intermediate sales. sales volume growth was primarily driven by favorable chemical intermediate sales Market-based pricing improved by 3%, primarily driven by an increase in plant nutrients, reflecting higher nitrogen pricing amid increased sulfur input costs. market-based pricing improved by 3% primarily driven by an increase in plant nutrients reflecting higher nitrogen pricing amid increased sulfur input costs Raw material pass-through pricing was down 2% following a net cost decrease in benzene and propylene, which is a major input to cumene, our largest raw material and key feedstock to our products. raw material pass-through pricing was down 2% following a net cost decrease in benzene and propylene which is a major input to cumene our largest raw material and key feedstock to our products Adjusted EBITDA was $5 million, down $47 million from last year. adjusted ebitda was $5 million down $47 million from last year This was primarily driven by the absence of insurance proceeds from the prior year of $26 million, the unfavorable impact of higher sulfur and natural gas raw material prices, higher utility expenses, and $11 million of winter storm-related impacts. On a sequential basis compared to the fourth quarter, higher sales volume growth supported by improved operational performance was more than offset by escalating raw material input prices. From a free cash flow perspective, the first quarter represents a seasonal use of cash as expected, primarily due to the timing of cash payments for CapEx following the prior quarter outages. The absence of insurance proceeds was also a meaningful driver of the year-over-year change. We continue to anticipate sequential improvement into the second quarter and expect the second half of the year to be a source of cash to achieve our full year expectations. Let's turn to Slide five. This was primarily driven by the absence of insurance proceeds from the prior year of $26 million, the unfavorable impact of higher sulfur and natural gas raw material prices, higher utility expenses, and $11 million of winter storm-related impacts. On a sequential basis compared to the fourth quarter, higher sales volume growth supported by improved operational performance was more than offset by escalating raw material input prices. this was primarily driven by the absence of insurance proceeds from the prior year of $26 million the unfavorable impact of higher sulfur and natural gas raw material prices higher utility expenses and $11 million of winter storm-related impacts. on a sequential basis compared to the fourth quarter higher sales volume growth supported by improved operational performance was more than offset by escalating raw material input prices From a free cash flow perspective, the first quarter represents a seasonal use of cash as expected, primarily due to the timing of cash payments for CapEx following the prior quarter outages. from a free cash flow perspective the first quarter represents a seasonal use of cash as expected primarily due to the timing of cash payments for capex following the prior quarter outages The absence of insurance proceeds was also a meaningful driver of the year-over-year change. the absence of insurance proceeds was also a meaningful driver of the year-over-year change We continue to anticipate sequential improvement into the second quarter and expect the second half of the year to be a source of cash to achieve our full year expectations. we continue to anticipate sequential improvement into the second quarter and expect the second half of the year to be a source of cash to achieve our full year expectations Let's turn to Slide five. let's turn to slide five On this slide, we are detailing our quarterly sales contributions by product line, as well as price and volume indicators, both year-over-year and sequentially. In light of the significant raw material inflation and the mix of our formula or index-based pricing mechanisms, we did not fully cover those costs in the first quarter. However, we anticipate recouping a large portion of that shortfall in the second quarter, particularly into the heart of the domestic planting season for plant nutrients. Starting with Nylon solutions, resin volumes improved sequentially on improved operational performance, while caprolactam volumes moderated in a soft demand environment, particularly for carpet applications. We saw a higher export mix in the first quarter of 2026, which is expected to continue in the near term. With our advantage position, we are evaluating export opportunities to ensure the best economic output for the integrated enterprise. On this slide, we are detailing our quarterly sales contributions by product line, as well as price and volume indicators, both year-over-year and sequentially. on this slide we are detailing our quarterly sales contributions by product line as well as price and volume indicators both year-over-year and sequentially In light of the significant raw material inflation and the mix of our formula or index-based pricing mechanisms, we did not fully cover those costs in the first quarter. in light of the significant raw material inflation and the mix of our formula or index-based pricing mechanisms we did not fully cover those costs in the first quarter However, we anticipate recouping a large portion of that shortfall in the second quarter, particularly into the heart of the domestic planting season for plant nutrients. however we anticipate recouping a large portion of that shortfall in the second quarter particularly into the heart of the domestic planting season for plant nutrients Starting with Nylon solutions, resin volumes improved sequentially on improved operational performance, while caprolactam volumes moderated in a soft demand environment, particularly for carpet applications. starting with nylon solutions resin volumes improved sequentially on improved operational performance while caprolactam volumes moderated in a soft demand environment particularly for carpet applications We saw a higher export mix in the first quarter of 2026, which is expected to continue in the near term. we saw a higher export mix in the first quarter of 2026 which is expected to continue in the near term With our advantage position, we are evaluating export opportunities to ensure the best economic output for the integrated enterprise. with our advantage position we are evaluating export opportunities to ensure the best economic output for the integrated enterprise Domestic pricing steadily increased overall, supported in part by higher input costs. Plant nutrient volumes were flat to down both year-over-year and sequentially in the first quarter, while pricing strength continued. In the early parts of the year, we witnessed more cautious buying behavior down the value chain and a more risk-averse sentiment from customers amid the higher input costs and rapidly rising nitrogen prices. Lastly, chemical intermediate sales improved on the back of volume improvements year-over-year. In acetone, as we mentioned on the first quarter 2025 earnings call, downstream MMA saw extended plant outages last year. In the first quarter of 2026, we observed more normalized operating rates down the value chain supporting demand. In addition, given pricing dynamics and trade flows across our key products in this portfolio, we delivered on opportunistic spot sales domestically and in the export markets. Domestic pricing steadily increased overall, supported in part by higher input costs. domestic pricing steadily increased overall supported in part by higher input costs Plant nutrient volumes were flat to down both year-over-year and sequentially in the first quarter, while pricing strength continued. plant nutrient volumes were flat to down both year-over-year and sequentially in the first quarter while pricing strength continued In the early parts of the year, we witnessed more cautious buying behavior down the value chain and a more risk-averse sentiment from customers amid the higher input costs and rapidly rising nitrogen prices. in the early parts of the year we witnessed more cautious buying behavior down the value chain and a more risk-averse sentiment from customers amid the higher input costs and rapidly rising nitrogen prices Lastly, chemical intermediate sales improved on the back of volume improvements year-over-year. lastly chemical intermediate sales improved on the back of volume improvements year-over-year In acetone, as we mentioned on the first quarter 2025 earnings call, downstream MMA saw extended plant outages last year. in acetone as we mentioned on the first quarter 2025 earnings call downstream mma saw extended plant outages last year In the first quarter of 2026, we observed more normalized operating rates down the value chain supporting demand. in the first quarter of 2026 we observed more normalized operating rates down the value chain supporting demand In addition, given pricing dynamics and trade flows across our key products in this portfolio, we delivered on opportunistic spot sales domestically and in the export markets. in addition given pricing dynamics and trade flows across our key products in this portfolio we delivered on opportunistic spot sales domestically and in the export markets

Speaker 4: Thanks, Chris. I'm now on Slide six to discuss what we're seeing across our major product lines. Our diversified end market exposure continues to be a strategic advantage, providing resilience across cycles. Agricultural and fertilizer remains our largest end market. As we sit here today, our domestic granular sales for this fertilizer year are now expected to be near record levels, but closer to flat as compared to the last fertilizer year. While the fertilizer year started off with optimism and a strong fall fill, as we've discussed in previous calls, buying has become more cautious given continued challenged fundamentals, including farmer profitability and input affordability, cold weather to start the spring, and drought conditions. Thanks, Chris. thanks chris I'm now on Slide six to discuss what we're seeing across our major product lines. i'm now on slide six to discuss what we're seeing across our major product lines Our diversified end market exposure continues to be a strategic advantage, providing resilience across cycles. our diversified end market exposure continues to be a strategic advantage providing resilience across cycles Agricultural and fertilizer remains our largest end market. agricultural and fertilizer remains our largest end market As we sit here today, our domestic granular sales for this fertilizer year are now expected to be near record levels, but closer to flat as compared to the last fertilizer year. as we sit here today our domestic granular sales for this fertilizer year are now expected to be near record levels but closer to flat as compared to the last fertilizer year While the fertilizer year started off with optimism and a strong fall fill, as we've discussed in previous calls, buying has become more cautious given continued challenged fundamentals, including farmer profitability and input affordability, cold weather to start the spring, and drought conditions. while the fertilizer year started off with optimism and a strong fall fill as we've discussed in previous calls buying has become more cautious given continued challenged fundamentals including farmer profitability and input affordability cold weather to start the spring and drought conditions What that means is we are now selling in-season tons with the ability to work coverage of sulfur input costs, which is important because amid a higher global nitrogen pricing environment on the heels of the conflict in the Middle East, our ammonium sulfate pricing actions are largely offsetting sulfur input costs rather than driving margin expansion in this current context. We know that growers value the cost of nutrition. In fact, ammonia for direct application is currently a relatively attractive value for growers. While we are not a large merchant ammonia supplier, we have seen good demand and netbacks and have been maximizing our ammonia availability this spring, while slightly moderating ammonium sulfate production. What that means is we are now selling in-season tons with the ability to work coverage of sulfur input costs, which is important because amid a higher global nitrogen pricing environment on the heels of the conflict in the Middle East, our ammonium sulfate pricing actions are largely offsetting sulfur input costs rather than driving margin expansion in this current context. what that means is we are now selling in-season tons with the ability to work coverage of sulfur input costs which is important because amid a higher global nitrogen pricing environment on the heels of the conflict in the middle east our ammonium sulfate pricing actions are largely offsetting sulfur input costs rather than driving margin expansion in this current context We know that growers value the cost of nutrition. we know that growers value the cost of nutrition In fact, ammonia for direct application is currently a relatively attractive value for growers. in fact ammonia for direct application is currently a relatively attractive value for growers While we are not a large merchant ammonia supplier, we have seen good demand and net backs and have been maximizing our ammonia availability this spring, while slightly moderating ammonium sulfate production. while we are not a large merchant ammonia supplier we have seen good demand and net backs and have been maximizing our ammonia availability this spring while slightly moderating ammonium sulfate production While we capture the benefit from the advantage between U.S. natural gas and global nitrogen prices, we also contend with the impact of sulfur input costs versus the sulfur value proposition we deliver to farmers. On tightened global supply, sulfur quarterly prices settled at a record $655 per long ton in the 2Q 2026, with the current spot prices trading even higher than those levels. That represents over 30% sequential increase and a roughly 140% surge year-over-year, so a meaningful increase that the industry is experiencing. Moving to our key nylon end markets across building and construction as well as engineering plastics, North American demand has not materially changed. Global pricing has moved up with capacity rationalization and raw material shortages in Europe, lower operating rates in China, logistics constraints, and higher input costs. While we capture the benefit from the advantage between U.S. natural gas and global nitrogen prices, we also contend with the impact of sulfur input costs versus the sulfur value proposition we deliver to farmers. while we capture the benefit from the advantage between u.s natural gas and global nitrogen prices we also contend with the impact of sulfur input costs versus the sulfur value proposition we deliver to farmers On tightened global supply, sulfur quarterly prices settled at a record $655 per long ton in the 2Q 2026, with the current spot prices trading even higher than those levels. on tightened global supply sulfur quarterly prices settled at a record $655 per long ton in the 2q 2026 with the current spot prices trading even higher than those levels That represents over 30% sequential increase and a roughly 140% surge year-over-year, so a meaningful increase that the industry is experiencing. that represents over 30% sequential increase and a roughly 140% surge year-over-year so a meaningful increase that the industry is experiencing Moving to our key nylon end markets across building and construction as well as engineering plastics, North American demand has not materially changed. moving to our key nylon end markets across building and construction as well as engineering plastics north american demand has not materially changed Global pricing has moved up with capacity rationalization and raw material shortages in Europe, lower operating rates in China, logistics constraints, and higher input costs. global pricing has moved up with capacity rationalization and raw material shortages in europe lower operating rates in china logistics constraints and higher input costs Our industry pricing mechanisms work to pass through changes in core raw materials, notably benzene, but also natural gas and sulfur. Given global trade flow dynamics, reduced imports have created opportunities to gain share. In this environment, it is critical for our business to remain agile through pricing and mix. We continue to execute our plan, including taking advantage of export opportunities as they arise, increasing prices to offset cost increases, and reducing inventory levels for the nylon resin to align with our current market conditions. In chemical intermediates, phenol demand remains soft overall, driving lower global operating rates, coupled with reduced acetone imports into the U.S., all of which are supporting tightening acetone supply and demand dynamics. Acetone price increases have been implemented in the industry to keep pace with rising propylene costs. Our industry pricing mechanisms work to pass through changes in core raw materials, notably benzene, but also natural gas and sulfur. our industry pricing mechanisms work to pass through changes in core raw materials notably benzene but also natural gas and sulfur Given global trade flow dynamics, reduced imports have created opportunities to gain share. given global trade flow dynamics reduced imports have created opportunities to gain share In this environment, it is critical for our business to remain agile through pricing and mix. in this environment it is critical for our business to remain agile through pricing and mix We continue to execute our plan, including taking advantage of export opportunities as they arise, increasing prices to offset cost increases, and reducing inventory levels for the nylon resin to align with our current market conditions. we continue to execute our plan including taking advantage of export opportunities as they arise increasing prices to offset cost increases and reducing inventory levels for the nylon resin to align with our current market conditions In chemical intermediates, phenol demand remains soft overall, driving lower global operating rates, coupled with reduced acetone imports into the U.S., all of which are supporting tightening acetone supply and demand dynamics. Acetone price increases have been implemented in the industry to keep pace with rising propylene costs. in chemical intermediates phenol demand remains soft overall driving lower global operating rates coupled with reduced acetone imports into the u.s all of which are supporting tightening acetone supply and demand dynamics. acetone price increases have been implemented in the industry to keep pace with rising propylene costs Spreads have held near cycle averages, and we continue that continue to anticipate that for the full-year of 2026. Let's move to Slide seven. We were excited to announce yesterday that we have entered into a process design and licensing agreement to assess expansion of our integrated ammonia platform to enable the domestic manufacturing of DEF, a critical emissions control product used across on and off-highway diesel applications. As background, DEF is an EPA mandated additive for reducing NOx emissions from diesel engines, with strong and growing demand driven primarily by Class 8 vehicle usage in the Mid-Atlantic and Northeast. Demand for DEF continues to grow to meet environmental standards and as regulatory requirements expand across transportation, construction, agriculture, and industrial equipment fleets. The AdvanSix Hopewell facility provides a strong foundation for expanding domestic manufacturing at this site and already produces all required DEF inputs. Spreads have held near cycle averages, and we continue that continue to anticipate that for the full- year of 2026. spreads have held near cycle averages and we continue that continue to anticipate that for the full- year of 2026 Let's move to Slide seven. let's move to slide seven We were excited to announce yesterday that we have entered into a process design and licensing agreement to assess expansion of our integrated ammonia platform to enable the domestic manufacturing of DEF, a critical emissions control product used across on and off-highway diesel applications. we were excited to announce yesterday that we have entered into a process design and licensing agreement to assess expansion of our integrated ammonia platform to enable the domestic manufacturing of def a critical emissions control product used across on and off-highway diesel applications As background, DEF is an EPA mandated additive for reducing NOx emissions from diesel engines, with strong and growing demand driven primarily by Class 8 vehicle usage in the Mid-Atlantic and Northeast. as background def is an epa mandated additive for reducing nox emissions from diesel engines with strong and growing demand driven primarily by class 8 vehicle usage in the mid-atlantic and northeast Demand for DEF continues to grow to meet environmental standards and as regulatory requirements expand across transportation, construction, agriculture, and industrial equipment fleets. demand for def continues to grow to meet environmental standards and as regulatory requirements expand across transportation construction agriculture and industrial equipment fleets The AdvanSix Hopewell facility provides a strong foundation for expanding domestic manufacturing at this site and already produces all required DEF inputs. the advansix hopewell facility provides a strong foundation for expanding domestic manufacturing at this site and already produces all required def inputs This potential expansion would complement existing manufacturing capabilities at the site with full continued commitment to the production of ammonium sulfate fertilizer to serve the U.S. farming industry. Our geographic position uniquely enables reliable supply to meet growing demand in a market currently served by imports and production from other domestic regions. Our investments over time with our ammonia unit operations have paid off in terms of our reliability and output. This project has the potential to unlock further value from our existing assets through increased optionality to serve a broadened customer base. We will advance through detailed engineering and development phases with final investment decision targeted for the first half of 2027. Additional updates will be provided as engineering, commercial, and financial milestones are achieved and regulatory approvals are secured. This potential expansion would complement existing manufacturing capabilities at the site with full continued commitment to the production of ammonium sulfate fertilizer to serve the U.S. farming industry. this potential expansion would complement existing manufacturing capabilities at the site with full continued commitment to the production of ammonium sulfate fertilizer to serve the u.s farming industry Our geographic position uniquely enables reliable supply to meet growing demand in a market currently served by imports and production from other domestic regions. our geographic position uniquely enables reliable supply to meet growing demand in a market currently served by imports and production from other domestic regions Our investments over time with our ammonia unit operations have paid off in terms of our reliability and output. our investments over time with our ammonia unit operations have paid off in terms of our reliability and output This project has the potential to unlock further value from our existing assets through increased optionality to serve a broadened customer base. this project has the potential to unlock further value from our existing assets through increased optionality to serve a broadened customer base We will advance through detailed engineering and development phases with final investment decision targeted for the first half of 2027. we will advance through detailed engineering and development phases with final investment decision targeted for the first half of 2027 Additional updates will be provided as engineering, commercial, and financial milestones are achieved and regulatory approvals are secured. additional updates will be provided as engineering commercial and financial milestones are achieved and regulatory approvals are secured We anticipate a multiyear capital investment supporting attractive financial returns following expected operational startup in 2029, which align with our long-term value creation objectives and commitment to disciplined capital allocation. Let's turn to Slide eight before moving to Q&A. AdvanSix offers a compelling investment thesis with value drivers supporting through cycle profitability and sustainable performance. Our strategic initiatives, unique combination of assets and business model are core to our durable competitive advantage and long-term positioning. Our global low-cost position and vertically integrated caprolactam production serves us well. Ammonia and sulfuric acid platform integration, coupled with a leading technology position, underpins how we win in plant nutrients. We are progressing our SUSTAIN ammonium sulfate growth program and have now announced another high return investment opportunity to serve the growing DEF market. We anticipate a multiyear capital investment supporting attractive financial returns following expected operational startup in 2029, which align with our long-term value creation objectives and commitment to disciplined capital allocation. we anticipate a multiyear capital investment supporting attractive financial returns following expected operational startup in 2029 which align with our long-term value creation objectives and commitment to disciplined capital allocation Let's turn to Slide eight before moving to Q&A. let's turn to slide eight before moving to q&a AdvanSix offers a compelling investment thesis with value drivers supporting through cycle profitability and sustainable performance. advansix offers a compelling investment thesis with value drivers supporting through cycle profitability and sustainable performance Our strategic initiatives, unique combination of assets and business model are core to our durable competitive advantage and long-term positioning. our strategic initiatives unique combination of assets and business model are core to our durable competitive advantage and long-term positioning Our global low-cost position and vertically integrated caprolactam production serves us well. our global low-cost position and vertically integrated caprolactam production serves us well Ammonia and sulfuric acid platform integration, coupled with a leading technology position, underpins how we win in plant nutrients. ammonia and sulfuric acid platform integration coupled with a leading technology position underpins how we win in plant nutrients We are progressing our SUSTAIN ammonium sulfate growth program and have now announced another high return investment opportunity to serve the growing DEF market. we are progressing our sustain ammonium sulfate growth program and have now announced another high return investment opportunity to serve the growing def market These capabilities, combined with increasing asset operational agility and diversified product and end market mix, position us to navigate cycles and capitalize on emerging opportunities. We remain focused on delivering on controllable levers, including our non-manpower fixed cost savings program, risk-based prioritization of our capital investments, continued working capital discipline, and 45Q carbon capture tax credits to support improved cash flow generation. With that, Adam, let's move to Q&A. These capabilities, combined with increasing asset operational agility and diversified product and end market mix, position us to navigate cycles and capitalize on emerging opportunities. these capabilities combined with increasing asset operational agility and diversified product and end market mix position us to navigate cycles and capitalize on emerging opportunities We remain focused on delivering on controllable levers, including our non-manpower fixed cost savings program, risk-based prioritization of our capital investments, continued working capital discipline, and 45Q carbon capture tax credits to support improved cash flow generation. we remain focused on delivering on controllable levers including our non-manpower fixed cost savings program risk-based prioritization of our capital investments continued working capital discipline and 45q carbon capture tax credits to support improved cash flow generation With that, Adam, let's move to Q&A. with that adam let's move to q&a

Speaker 1: Thanks, Erin. Danielle, can you please open the line for questions? Thanks, Erin. thanks erin Danielle, can you please open the line for questions? danielle can you please open the line for questions

Speaker 5: Thank you. We will now begin the question-and-answer session. To ask a question, you may press star then one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. The first question comes from Pete Osterland from Truist Securities. Please go ahead. Thank you. thank you We will now begin the question- and- answer session. we will now begin the question- and- answer session To ask a question, you may press star then one on your touchtone phone. to ask a question you may press star then one on your touchtone phone If you are using a speakerphone, please pick up your handset before pressing the keys. if you are using a speakerphone please pick up your handset before pressing the keys If at any time your question has been addressed and you would like to withdraw your question, please press star then two. if at any time your question has been addressed and you would like to withdraw your question please press star then two The first question comes from Pete Osterland from Truist Securities. the first question comes from pete osterland from truist securities Please go ahead. please go ahead

Speaker 6: Hey, good morning. Thanks for taking the questions. Just wanted to start on the DEF ammonia project. I guess, do you have a rough estimate you can share for the capital intensity you expect for this project between now and 2029? You know, maybe how does the return hurdle you're targeting at this point compare to other programs you've had, like SUSTAIN and the IRRs you've referenced there? Hey, good morning. hey good morning Thanks for taking the questions. thanks for taking the questions Just wanted to start on the DEF ammonia project. just wanted to start on the def ammonia project I guess, do you have a rough estimate you can share for the capital intensity you expect for this project between now and 2029? i guess do you have a rough estimate you can share for the capital intensity you expect for this project between now and 2029 You know, maybe how does the return hurdle you're targeting at this point compare to other programs you've had, like SUSTAIN and the IRRs you've referenced there? you know maybe how does the return hurdle you're targeting at this point compare to other programs you've had like sustain and the irrs you've referenced there

Speaker 4: Thanks, Pete. Good morning, appreciate the question. At this time, you know, I would share that we would expect the CapEx for this program, you know, certainly to be larger than our SUSTAIN program. Hopefully, you can appreciate that while, you know, we're investigating and doing our FEED process, you know, we are having a number of negotiations with folks and, you know, at this time would keep, you know, the actual CapEx range, you know, a bit confidential and more to come there. You can think about it certainly as a larger program than SUSTAIN. That said, our internal, you know, targets as we've shared for high return growth and cost savings projects, you know, are a 20%+ IRR, you know, hurdle rates. You know, this project fits, you know, well into that range. Thanks, Pete. thanks pete Good morning, appreciate the question. good morning appreciate the question At this time, you know, I would share that we would expect the CapEx for this program, you know, certainly to be larger than our SUSTAIN program. at this time you know i would share that we would expect the capex for this program you know certainly to be larger than our sustain program Hopefully, you can appreciate that while, you know, we're investigating and doing our FEED process, you know, we are having a number of negotiations with folks and, you know, at this time would keep, you know, the actual CapEx range, you know, a bit confidential and more to come there. hopefully you can appreciate that while you know we're investigating and doing our feed process you know we are having a number of negotiations with folks and you know at this time would keep you know the actual capex range you know a bit confidential and more to come there You can think about it certainly as a larger program than SUSTAIN. you can think about it certainly as a larger program than sustain That said, our internal, you know, targets as we've shared for high return growth and cost savings projects, you know, are a 20%+ IRR, you know, hurdle rates. that said our internal you know targets as we've shared for high return growth and cost savings projects you know are a 20%+ irr you know hurdle rates You know, this project fits, you know, well into that range. you know this project fits you know well into that range You know, we're here today and certainly announcing it yesterday, you know, given the fact that this continues to, you know, demonstrate real great potential for the company. You know, we're here today and certainly announcing it yesterday, you know, given the fact that this continues to, you know, demonstrate real great potential for the company. you know we're here today and certainly announcing it yesterday you know given the fact that this continues to you know demonstrate real great potential for the company

Speaker 6: Very helpful. Thanks. You know, kind of switching gears, I guess, just when you think about the level of sulfur pricing that you're guiding to for the second quarter, I mean, is it your expectation at this point that prices should be at or above that level for the remainder of the year? I mean, you know, even if the Iran conflict ended very soon, I guess how long would you expect at this point until you start seeing some easing, for the dynamics that are driving higher prices in that market? Very helpful. very helpful Thanks. thanks You know, kind of switching gears, I guess, just when you think about the level of sulfur pricing that you're guiding to for the second quarter, I mean, is it your expectation at this point that prices should be at or above that level for the remainder of the year? you know kind of switching gears i guess just when you think about the level of sulfur pricing that you're guiding to for the second quarter i mean is it your expectation at this point that prices should be at or above that level for the remainder of the year I mean, you know, even if the Iran conflict ended very soon, I guess how long would you expect at this point until you start seeing some easing, for the dynamics that are driving higher prices in that market? i mean you know even if the iran conflict ended very soon i guess how long would you expect at this point until you start seeing some easing for the dynamics that are driving higher prices in that market

Speaker 4: I mean, certainly, you're probably aware that spot prices continue to, you know, trade higher than the Q2 settlement. You know, certainly, as we think about the Q3 settlement, that will come in a couple of months, right? It's settled by two large phosphate, you know, producers here in the U.S., and they're our three largest suppliers. I think consistent with what you're probably hearing with others in this space, even if things were to, you know, we have a resolution in the Middle East, there is quite a bit of time, certainly for things to settle back out. You know, I would share that security of supply is not a consideration for us. You know, being that we're buying here in North America. I mean, certainly, you're probably aware that spot prices continue to, you know, trade higher than the Q2 settlement. i mean certainly you're probably aware that spot prices continue to you know trade higher than the q2 settlement You know, certainly, as we think about the Q3 settlement, that will come in a couple of months, right? you know certainly as we think about the q3 settlement that will come in a couple of months right It's settled by two large phosphate, you know, producers here in the U.S., and they're our three largest suppliers. it's settled by two large phosphate you know producers here in the u.s and they're our three largest suppliers I think consistent with what you're probably hearing with others in this space, even if things were to, you know, we have a resolution in the Middle East, there is quite a bit of time, certainly for things to settle back out. i think consistent with what you're probably hearing with others in this space even if things were to you know we have a resolution in the middle east there is quite a bit of time certainly for things to settle back out You know, I would share that security of supply is not a consideration for us. you know i would share that security of supply is not a consideration for us You know, being that we're buying here in North America. you know being that we're buying here in north america You know, certainly there is a lot of sulfur, 50% or so world, you know, supply comes from the Middle East. You know, we're in a great spot being a North American producer and purchaser, you know, here. You know, certainly we would anticipate now that it's hard to predict, but pricing probably does stay a bit, you know, higher for longer. We'll have to see what, you know, really it does for demand, you know, into its largest applications, right? Just over 50% of the world's sulfur goes into phosphate fertilizer. Watching that will be key compared to, you know, what we see. You know, certainly there is a lot of sulfur, 50% or so world, you know, supply comes from the Middle East. you know certainly there is a lot of sulfur 50% or so world you know supply comes from the middle east You know, we're in a great spot being a North American producer and purchaser, you know, here. you know we're in a great spot being a north american producer and purchaser you know here You know, certainly we would anticipate now that it's hard to predict, but pricing probably does stay a bit, you know, higher for longer. you know certainly we would anticipate now that it's hard to predict but pricing probably does stay a bit you know higher for longer We'll have to see what, you know, really it does for demand, you know, into its largest applications, right? we'll have to see what you know really it does for demand you know into its largest applications right Just over 50% of the world's sulfur goes into phosphate fertilizer. just over 50% of the world's sulfur goes into phosphate fertilizer Watching that will be key compared to, you know, what we see. watching that will be key compared to you know what we see We feel good about, you know, certainly our sequential opportunity to, you know, recover, and that's been our focus, you know, really as we are progressing, you know, now in Q2 as we move forward. We feel good about, you know, certainly our sequential opportunity to, you know, recover, and that's been our focus, you know, really as we are progressing, you know, now in Q2 as we move forward. we feel good about you know certainly our sequential opportunity to you know recover and that's been our focus you know really as we are progressing you know now in q2 as we move forward

Speaker 6: All right. Very helpful. Thank you, Erin. All right. all right Very helpful. very helpful Thank you, Erin. thank you erin

Speaker 4: Yeah. Yeah. yeah

Speaker 5: The next question comes from David Silver from Freedom Capital Markets. Please go ahead. The next question comes from David Silver from Freedom Capital Markets. the next question comes from david silver from freedom capital markets Please go ahead. please go ahead

Speaker 3: Yeah, hi. Thank you. Let me just get my questions in order here. You know, I did want to go back to maybe the sulfur question and a couple of your comments regarding ammonium sulfate. You know, I think you mentioned that ammonium sulfate prices are increasing, but, you know, more or less in line with the rise in sulfur costs. You know, I'm just wondering, you know, you talked about kind of balanced markets, whereas, I mean, for most nitrogen fertilizer products, it's, you know, somewhat different supply-demand aspect. It's very tight. You know, you do have a very strong vertically integrated production structure. Yeah, hi. yeah hi Thank you. thank you Let me just get my questions in order here. let me just get my questions in order here You know, I did want to go back to maybe the sulfur question and a couple of your comments regarding ammonium sulfate. you know i did want to go back to maybe the sulfur question and a couple of your comments regarding ammonium sulfate You know, I think you mentioned that ammonium sulfate prices are increasing, but, you know, more or less in line with the rise in sulfur costs. you know i think you mentioned that ammonium sulfate prices are increasing but you know more or less in line with the rise in sulfur costs You know, I'm just wondering, you know, you talked about kind of balanced markets, whereas, I mean, for most nitrogen fertilizer products, it's, you know, somewhat different supply-demand aspect. you know i'm just wondering you know you talked about kind of balanced markets whereas i mean for most nitrogen fertilizer products it's you know somewhat different supply-demand aspect It's very tight. it's very tight You know, you do have a very strong vertically integrated production structure. you know you do have a very strong vertically integrated production structure Just wondering what kind of in-season flexibility you think you have to maybe exploit, you know, some pretty big, you know, some pretty big, I don't know, price differentials amongst the different nitrogen fertilizer products? You know, you've looked at these markets for quite a while. You know, why not tilt or lean on, you know, direct ammonia sales and a little bit less of the ammonium sulfate here? Just wondering what kind of in-season flexibility you think you have to maybe exploit, you know, some pretty big, you know, some pretty big, I don't know, price differentials amongst the different nitrogen fertilizer products? just wondering what kind of in-season flexibility you think you have to maybe exploit you know some pretty big you know some pretty big i don't know price differentials amongst the different nitrogen fertilizer products You know, you've looked at these markets for quite a while. you know you've looked at these markets for quite a while You know, why not tilt or lean on, you know, direct ammonia sales and a little bit less of the ammonium sulfate here? you know why not tilt or lean on you know direct ammonia sales and a little bit less of the ammonium sulfate here

Speaker 4: No, thanks for that question, Dave. Certainly, you know, hopefully that was, you know, teased out a bit in our remarks. You know, we are, you know, a big producer and a leader in ammonium sulfate, and that is certainly, you know, a place here. As you say, you know, with ammonium sulfate, we are and do, you know, get that differential certainly between, you know, where nitrogen is priced in our U.S. natural gas position. We also can have that directly in our ammonia sales as well. I would say right now it's a moderate lever, right? You know, certainly, you know, we are and can pull back a bit right onto our ammonium sulfate production. No, thanks for that question, Dave. no thanks for that question dave Certainly, you know, hopefully that was, you know, teased out a bit in our remarks. certainly you know hopefully that was you know teased out a bit in our remarks You know, we are, you know, a big producer and a leader in ammonium sulfate, and that is certainly, you know, a place here. you know we are you know a big producer and a leader in ammonium sulfate and that is certainly you know a place here As you say, you know, with ammonium sulfate, we are and do, you know, get that differential certainly between, you know, where nitrogen is priced in our U.S. natural gas position. as you say you know with ammonium sulfate we are and do you know get that differential certainly between you know where nitrogen is priced in our u.s natural gas position We also can have that directly in our ammonia sales as well. we also can have that directly in our ammonia sales as well I would say right now it's a moderate lever, right? i would say right now it's a moderate lever right You know, certainly, you know, we are and can pull back a bit right onto our ammonium sulfate production. you know certainly you know we are and can pull back a bit right onto our ammonium sulfate production We continue, as we shared last year, you know, produce ammonia at, you know, historically high levels and then certainly relative to what we are, you know, targeting to sell would be consistent with that. You know, again, farmers need NPK, they need S, right? There is a value proposition for sulfur and, you know, we continue to focus on ensuring that, you know, they have their needs met there as well. Certainly a little bit different than perhaps historical when, you know, nitrogen has moved and you have the, you know, the spread. This situation right now, you know, compared to perhaps, you know, Ukraine and Russia definitely continues to, you know, just have us, you know, contend with the sulfur. We continue, as we shared last year, you know, produce ammonia at, you know, historically high levels and then certainly relative to what we are, you know, targeting to sell would be consistent with that. we continue as we shared last year you know produce ammonia at you know historically high levels and then certainly relative to what we are you know targeting to sell would be consistent with that You know, again, farmers need NPK, they need S, right? you know again farmers need npk they need s right There is a value proposition for sulfur and, you know, we continue to focus on ensuring that, you know, they have their needs met there as well. there is a value proposition for sulfur and you know we continue to focus on ensuring that you know they have their needs met there as well Certainly a little bit different than perhaps historical when, you know, nitrogen has moved and you have the, you know, the spread. certainly a little bit different than perhaps historical when you know nitrogen has moved and you have the you know the spread This situation right now, you know, compared to perhaps, you know, Ukraine and Russia definitely continues to, you know, just have us, you know, contend with the sulfur. this situation right now you know compared to perhaps you know ukraine and russia definitely continues to you know just have us you know contend with the sulfur Certainly farmers do seem to be sticking more with N, and you know, we're looking to take advantage of that to and really, you know, provide the opportunity that we have off our assets to do so. Certainly farmers do seem to be sticking more with N, and you know, we're looking to take advantage of that to and really, you know, provide the opportunity that we have off our assets to do so. certainly farmers do seem to be sticking more with n and you know we're looking to take advantage of that to and really you know provide the opportunity that we have off our assets to do so

Speaker 3: Okay. Just to, I'm gonna follow-up with a couple of, you know, targeted questions. Firstly, you know, you did talk about the sulfur market, you did talk about your positioning, you know, able to get all the sulfur that you require. There is, I don't know, I'm guessing it's unprecedented, but there is this gap that you touched on between the spot price of sulfur and the contract price of sulfur. You know, I just wanted to clarify that AdvanSix is able to purchase at the contract price, you know, the lower contract price, you know, under your current supply agreements and rather than, you know, some mix of contract and spot pricing. Okay. okay Just to, I'm gonna follow- up with a couple of, you know, targeted questions. just to i'm gonna follow- up with a couple of you know targeted questions Firstly, you know, you did talk about the sulfur market, you did talk about your positioning, you know, able to get all the sulfur that you require. firstly you know you did talk about the sulfur market you did talk about your positioning you know able to get all the sulfur that you require There is, I don't know, I'm guessing it's unprecedented, but there is this gap that you touched on between the spot price of sulfur and the contract price of sulfur. there is i don't know i'm guessing it's unprecedented but there is this gap that you touched on between the spot price of sulfur and the contract price of sulfur You know, I just wanted to clarify that AdvanSix is able to purchase at the contract price, you know, the lower contract price, you know, under your current supply agreements and rather than, you know, some mix of contract and spot pricing. you know i just wanted to clarify that advansix is able to purchase at the contract price you know the lower contract price you know under your current supply agreements and rather than you know some mix of contract and spot pricing Just if you could just kinda touch on, you know, your supply arrangements for sulfur, and in particular, you know, how tight is the relationship between the, you know, the U.S. contract price versus having to, you know, go out into the spot market? Just if you could just kinda touch on, you know, your supply arrangements for sulfur, and in particular, you know, how tight is the relationship between the, you know, the U.S. contract price versus having to, you know, go out into the spot market? just if you could just kinda touch on you know your supply arrangements for sulfur and in particular you know how tight is the relationship between the you know the u.s contract price versus having to you know go out into the spot market

Speaker 4: I can confirm that we purchase entirely on the contract market. I can confirm that we purchase entirely on the contract market. i can confirm that we purchase entirely on the contract market

Speaker 3: Okay, great. Thank you for that. I did want to follow up maybe on the DEF project, you know, very interesting, you know, project and leveraging, you know, some of that, some of your capabilities. You know, I read the release the other day, then I read your comments in the prepared remarks. You know, certainly you're going to be adding some urea melt capacity there. Will you also be debottlenecking ammonia? You know, in other words, are you going to have a higher ammonia capacity, you know, once the project is all finished than you currently have? You know, how should I just kind of think about that in terms of allocating ammonia amongst, you know, the nylon, the fertilizer, and now the DEF? Okay, great. okay great Thank you for that. thank you for that I did want to follow up maybe on the DEF project, you know, very interesting, you know, project and leveraging, you know, some of that, some of your capabilities. i did want to follow up maybe on the def project you know very interesting you know project and leveraging you know some of that some of your capabilities You know, I read the release the other day, then I read your comments in the prepared remarks. you know i read the release the other day then i read your comments in the prepared remarks You know, certainly you're going to be adding some urea melt capacity there. you know certainly you're going to be adding some urea melt capacity there Will you also be debottlenecking ammonia? will you also be debottlenecking ammonia You know, in other words, are you going to have a higher ammonia capacity, you know, once the project is all finished than you currently have? you know in other words are you going to have a higher ammonia capacity you know once the project is all finished than you currently have You know, how should I just kind of think about that in terms of allocating ammonia amongst, you know, the nylon, the fertilizer, and now the DEF? you know how should i just kind of think about that in terms of allocating ammonia amongst you know the nylon the fertilizer and now the def

Speaker 4: Certainly this next phase does not, you know, this project doesn't require, excuse me, an ammonia expansion. You know, certainly given our geographical location, our integrated platform, you know, we always look at marginal ammonia de-bottlenecks. For the DEF, we do not need to expand ammonia for the purposes of the project. Certainly this next phase does not, you know, this project doesn't require, excuse me, an ammonia expansion. certainly this next phase does not you know this project doesn't require excuse me an ammonia expansion You know, certainly given our geographical location, our integrated platform, you know, we always look at marginal ammonia de-bottlenecks. you know certainly given our geographical location our integrated platform you know we always look at marginal ammonia de-bottlenecks For the DEF, we do not need to expand ammonia for the purposes of the project. for the def we do not need to expand ammonia for the purposes of the project

Speaker 3: Okay, very good. Last one from me, I would like to just get an update on the Section 45Q credits. You did talk about it, I'm guessing that the file of the 2025 filings for roughly $20 million that has not been received yet. Just kind of an update on that, what do, you know, do you anticipate filing for an additional, you know, tranche of the credits to which you're entitled in the current fiscal year? You know, should we think about that maybe in the $20 million range as well? Okay, very good. okay very good Last one from me, I would like to just get an update on the Section 45Q credits. last one from me i would like to just get an update on the section 45q credits You did talk about it, I'm guessing that the file of the 2025 filings for roughly $20 million that has not been received yet. you did talk about it i'm guessing that the file of the 2025 filings for roughly $20 million that has not been received yet Just kind of an update on that, what do, you know, do you anticipate filing for an additional, you know, tranche of the credits to which you're entitled in the current fiscal year? just kind of an update on that what do you know do you anticipate filing for an additional you know tranche of the credits to which you're entitled in the current fiscal year You know, should we think about that maybe in the $20 million range as well? you know should we think about that maybe in the $20 million range as well

Speaker 2: Yeah. David, thanks for, thanks for that question. As you can imagine, there's been a lot of continuing activity around 45Q. We are have the audit process underway with the IRS for the 2018 through the 2020 years of credits. We anticipate field work being wrapped up in the second quarter. We're making good progress on the audit itself. In terms of the timing of the cash, while $20 million was the sort of full value, we've already received two of that in prior years, we're anticipating another 18. We would expect the proceeds for that in the second half, subject to the IRS approval process. We're expecting that in the second half. Yeah. yeah David, thanks for, thanks for that question. david thanks for thanks for that question As you can imagine, there's been a lot of continuing activity around 45Q. as you can imagine there's been a lot of continuing activity around 45q We are have the audit process underway with the IRS for the 2018 through the 2020 years of credits. we are have the audit process underway with the irs for the 2018 through the 2020 years of credits We anticipate field work being wrapped up in the second quarter. we anticipate field work being wrapped up in the second quarter We're making good progress on the audit itself. we're making good progress on the audit itself In terms of the timing of the cash, while $20 million was the sort of full value, we've already received two of that in prior years, we're anticipating another 18. in terms of the timing of the cash while $20 million was the sort of full value we've already received two of that in prior years we're anticipating another 18 We would expect the proceeds for that in the second half, subject to the IRS approval process. we would expect the proceeds for that in the second half subject to the irs approval process We're expecting that in the second half. we're expecting that in the second half In terms of the life cycle assessment for the 2021 year and following, we've submitted those to the DOE, and we're working now with the DOE and the IRS to get those certified. Just as a reminder, we've been at this for over five years, this process just takes some time as we work through with the government to get their approval and the due diligence that they do. Hopefully, those will be coming shortly. That's the process and where we are so In terms of the life cycle assessment for the 2021 year and following, we've submitted those to the DOE, and we're working now with the DOE and the IRS to get those certified. in terms of the life cycle assessment for the 2021 year and following we've submitted those to the doe and we're working now with the doe and the irs to get those certified Just as a reminder, we've been at this for over five years, this process just takes some time as we work through with the government to get their approval and the due diligence that they do. just as a reminder we've been at this for over five years this process just takes some time as we work through with the government to get their approval and the due diligence that they do Hopefully, those will be coming shortly. hopefully those will be coming shortly That's the process and where we are so that's the process and where we are so

Speaker 3: Okay, great. Thank you for the update. Okay, great. okay great Thank you for the update. thank you for the update

Speaker 2: Thanks. Thanks. thanks

Speaker 4: Thanks, David. Thanks, David. thanks david

Speaker 5: This concludes our question-and-answer session. I would like to turn the conference back over to Erin Kane for closing remarks. This concludes our question- and- answer session. this concludes our question- and- answer session I would like to turn the conference back over to Erin Kane for closing remarks. i would like to turn the conference back over to erin kane for closing remarks

Speaker 4: Thank you all again for your time and interest this morning. As we move through the remainder of 2026 and navigate a dynamic environment, we are well-positioned to support our strategic priorities as a U.S.-based integrated manufacturer aligned to domestic supply chains and energy markets, as well as a diverse set of end market applications. With that, we look forward to speaking with you again next quarter. Stay safe and be well. Thank you all again for your time and interest this morning. thank you all again for your time and interest this morning As we move through the remainder of 2026 and navigate a dynamic environment, we are well-positioned to support our strategic priorities as a U.S.-based integrated manufacturer aligned to domestic supply chains and energy markets, as well as a diverse set of end market applications. as we move through the remainder of 2026 and navigate a dynamic environment we are well-positioned to support our strategic priorities as a u.s.-based integrated manufacturer aligned to domestic supply chains and energy markets as well as a diverse set of end market applications With that, we look forward to speaking with you again next quarter. with that we look forward to speaking with you again next quarter Stay safe and be well. stay safe and be well

Speaker 5: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect. The conference is now concluded. the conference is now concluded Thank you for attending today's presentation. thank you for attending today's presentation You may now disconnect. you may now disconnect