Solstice Advanced Materials Inc.

Greetings and welcome to the Solstice Advanced Materials First Quarter 2026 Earnings Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce Mike Leathead, Vice President of Investor Relations. Please go ahead.

Thank you and good morning, everyone. Welcome to Solstice's first quarter 2026 earnings call. We released our first quarter 2026 financial results earlier this morning. Today's presentation, including non-GAAP reconciliations and our earnings press release are available on the investor relations portion of Solstice's website at investor.solstice.com. Our discussion today will include forward-looking statements that are based on our best view of the world and our businesses as we see them today, and are subject to risks and uncertainties, including the ones described in our SEC filings. Joining me today are David Sewell, our President and CEO, and Tina Pierce, our CFO. David will open today's call with highlights of our first quarter results. Tina will then review our segment performance and financial outlook before turning the call back to David for closing remarks. We will then be happy to take your questions. With that, I'll now turn the call over to David.

Thank you, Mike. And thank you, everyone, for joining us today. During the first quarter, Solstice Advanced Materials delivered strong top and bottom line results, reflecting ongoing robust demand trends across several of our key businesses, including nuclear, electronic materials, and refrigerants. I would like to take a moment to thank our entire Solstice team for this strong outcome and what was our first full standalone quarter as an independent company. This performance demonstrates Solstice's ongoing discipline, execution, and agility, not only through our transition to a standalone company, but also in a dynamic macro environment. At the same time, Our top-tier return profile and conservative leverage position allows us to reinvest and grow at a time when many in the industry have needed to pare back. We continue to invest in compelling growth areas aligned with our strategic pillars, such as our electronic materials, safety and defense solutions, and nuclear businesses, consistent with what we believe are attractive, long-term outlets for demand. This growth investment is not just in CapEx, but also higher spending on our R&D pipeline as we work to advance the next generation of critical molecules for our customers. The first quarter was also a strong cash quarter for Solstice, generating nearly $200 million in operating cash flow. We are able to use this cash to not only fund our growth investments, but also return cash to share owners as highlighted by our recently announced quarterly dividend. We will continue to be disciplined in our capital allocation, ensuring that we are prudently balancing share owner returns with opportunities that we believe will unleash long-term growth. With this strong start to 2026, today we are reaffirming our full year 2026 guidance that we provided on our last quarterly call. We continue to believe we remain very well positioned for the year. Turning to slide four, I'd like to spend a moment to highlight our ongoing growth investments in advanced computing, which is a key strategic pillar for the company. The semiconductor industry is evolving rapidly, and we believe the ongoing shift to advanced nodes and advanced packaging creates significant growth opportunities for Solstice's core deposition and thermal management platforms. Our electronic materials business had a fantastic quarter, delivering 21% year-on-year revenue growth, following 19% year-on-year growth in the fourth quarter of 2025. We think it's also important to note that thermal management for Solstice extends into our RAS business with accelerating sales of refrigerants into data centers and a pipeline of next-generation molecules under development. Solstice has a rich history of partnering both with semiconductor companies and HVAC solution providers, and we believe this provides us with significant opportunities in this space as a data center ecosystem become increasingly integrated. At a product level, an area we want to highlight this quarter is our sputtering targets offerings for deposition, which we believe are the materials of choice for leading-edge semiconductor nodes used for AI and data center applications. With robust demand, we are investing $200 million in our Spokane, Washington facility to double our target's capacity, reduce customer lead times, and at the same time, provide sustainability benefits through increased recycling and CO2 emissions reduction. This is a clear example of where we have the opportunity to invest to benefit our customers share owners, and broader stakeholders. Importantly, as with all projects we evaluate, we analyze opportunities through a strict returns-based approach, and we do expect this project to exceed Solstice's acceptable hurdle rate of a mid-teens percentage IRR, underscoring our commitment to our top-tier return profile. Given the increasing customer demand trends, we are also evaluating opportunities to further accelerate similar organic growth investments, as well as strengthen our innovation pipeline in this space. All in, we are excited about the growth prospects and recent performance of this strategic pillar, and we look forward to building on our strong foundation of innovation with ongoing high-return growth investments. Turning to slide five, I'd like to discuss our first quarter 2026 consolidated results. In the first quarter of 2026, Solstice recorded $991 million in net sales, up 10% year-over-year, which exceeded the top end of our guidance we provided for the quarter. In our refrigerants and applied solutions segment, strong demand for refrigerants driven by the ongoing HFO transition, as well as healthy performance and our nuclear business drove top-line growth for the segment. In our electronic and specialty materials segment, net sales growth was driven by robust demand in our electronic materials business for semiconductor applications. Adjusted EBITDA for the first quarter of 2026 was $249 million, relatively flat year-over-year and exceeding the top end of the guidance we provided for the quarter. adjusted EBITDA margin was 25.1% in line with our expectations for the quarter. The decline in margin year over year was primarily driven, as expected, by refrigerant mix related to the ongoing HFO transition, as well as higher R&D investment as we prioritize next generation innovation and opportunities. As a reminder, This refrigerant dynamic has been previously communicated as we see ongoing strong demand for our LGWP product. Now, approximately four quarters into the 454B transition, we do expect sequential refrigerant margin improvement from first quarter levels, and we remain optimistic about the opportunity for further margin expansion as the aftermarket develops. we reported GAAP net income attributable to Solstice of $85 million for the first quarter of 2026. The decrease year-over-year was primarily driven by costs associated with being a standalone public company, such as higher SG&A and interest expense. We would also note that our non-controlling interest was atypically high this quarter at $20 million, with the increase driven by favorable Conradine margins and the impact from a consolidated entity associated with our Sinocam JV and does not reflect the expected quarterly run rate going forward. This quarter, we also reported adjusted diluted EPS for our first full quarter as a standalone company, which was 63 cents for the first quarter. Finally, free cash flow for the first quarter of 2026, was $124 million, which is inclusive of the significant year-over-year increase in growth capex as we invest in high return opportunities across the business, including the Spokane expansion that I previously discussed. With that, I'll now turn it over to Tina Pierce, our CFO, to discuss our financial results for the first quarter in more detail.