Cabot Corporation

Good day and thank you for standing by. Welcome to the third quarter 2025 Cabot Corporation earnings conference call. At this time, all participants are in a listen only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Steve Delahunt, Vice President, Investor Relations, and Treasurer. Please go ahead.

Thank you, Jill, and good morning. I would like to welcome you to the Cabot Corporation Earnings Teleconference. With me today are Sean Cohane, CEO and President, and Erica McLaughlin, Executive Vice President and CFO. Last night, we released results for our third quarter of fiscal 2025, copies of which are posted in the investor relations section of our website. The slide deck that accompanies this call is also available in the investor relations portion of our website and will be available in conjunction with the replay of the call. During this conference call, we will make forward-looking statements about our expected future operational and financial performance. Each forward-looking statement is subject to risks and certainties that could cause actual results to differ materially. from those projected in such statements. Additional information regarding these factors appears in the press release we issued last night and in our 10-K for the fiscal year ended September 30, 2024, and in subsequent filings we make with the SEC. All of which are available on the company's website. In order to provide greater transparency regarding our operating performance, we refer to certain non-GAAP financial measures that involve adjustments to GAAP results. The non-GAAP financial measures referenced on this call are reconciled to the most directly comparable GAAP financial measure in a table at the end of our earnings release issued last night and available in the investor section of our website. I will now turn the call over to Sean, who will discuss the third quarter highlights and some strategic highlights. Eric will review the third quarter financial results along with the business segment results and provide an update on our M&A and capital allocation priorities. Following this, Sean will discuss our outlook for fiscal 2025 And then open the floor to questions. Sean?

Thank you, Steve, and good morning, ladies and gentlemen, and welcome to our call today. I am pleased with our strong third quarter results, which were a bit better than our expectations. We delivered Q3 adjusted earnings per share of $1.90, which was in line with our second quarter results and down 1% as compared to the same period in the prior year. Overall, we continue to execute at a high level and operate with agility in this dynamic and challenging macroeconomic environment. While both segments were impacted by 8% lower volumes year over year, given the challenging macroeconomic backdrop, we largely offset these impacts through strong network optimization, cost management efforts, and continued execution of commercial excellence actions. Looking at the segments, we delivered solid EBIT results from reinforcement materials, which was down 6% year-over-year in the third quarter, and strong EBIT results in performance chemicals, which was up 4% as compared to the third quarter of the prior year. The Cabot portfolio has strong cash flow characteristics, and this continued strength was exhibited in the quarter. We generated $249 million of operating cash flow in the third quarter, which funded our capital expenditures and enabled 64 million of cash returned to shareholders through a combination of share repurchases and dividends. During the quarter, we also made important progress on key elements of our Creating for Tomorrow strategy. I'll spend a few minutes now highlighting four accomplishments that are important elements of our strategy for long-term shareholder value creation. Last night, we announced that Cabot has entered into a definitive agreement to acquire Bridgestone's reinforcing carbons plant in Mexico for $70 million. This manufacturing facility is located in close proximity to Cabot's current reinforcing carbons facility in Altamira, Mexico, and strengthens our longstanding partnership with Bridgestone through the long-term supply of reinforcing carbon products from this plant. The facility also has the capacity to manufacture additional reinforcing carbons, providing flexibility to support broader customer needs and future growth opportunities for Cabot. Furthermore, it underscores Bridgestone's confidence in Cabot as a trusted partner with a proven track record of delivering high-quality, reliable supply of reinforcing carbon products. The transaction is expected to close within three to six months and to be accretive in the first year. This is an example of how we are deploying our strong cash flow to fund an attractive acquisition that strengthens our portfolio, drives incremental growth, and is accretive to earnings. Sustainability is at the heart of our purpose and integral to our strategy of creating value for our customers. Given that, we are especially proud of the various forms of external recognition that we have received over the years for our sustainability leadership. At the top of that list is the platinum rating we received from EcoVedas for the fifth consecutive year. EcoVedas is the world's largest and most trusted provider of business sustainability ratings with more than 150,000 rated companies. A platinum rating is the highest level of achievement and places Cabot among the top 1% of companies in the manufacturing of basic chemicals. This prestigious recognition underscores Cabot's commitment to transparency and provides our customers with visibility into our sustainability performance. In battery materials, we continue to execute well against our growth strategy to build a leadership position. Through the first three quarters of fiscal year 2025, we have increased contribution margin by 20% compared to the same period in fiscal year 2024. Our strategy is centered around the view that the battery industry is bifurcating with differences between China and the rest of the world. In China, growth is high with EV penetration now exceeding 50% of annual vehicle sales. The environment across the EV value chain is competitive, and our segment strategy, segmentation strategy is focused on differentiation based on blends of conductive additives and targeting those customers that serve the higher value segment of the domestic economy and the export market. Outside of China, we are focused on building incumbent positions with the battery customers that are establishing manufacturing plans in the western economies. These customers value our breadth of technology as we are the only global player that can produce both conductive carbons and carbon nanotubes as well as blends. Additionally, our global footprint is an important feature to address their desire for a local supply chain and strong regional application and sales support. While the build out of battery production in North America and Europe is developing more slowly than it originally anticipated, It is expected to grow at a compound annual growth rate of approximately 40% through 2030 and represent 25 to 30% of global production by that date. Our strong reputation, breadth of product offering, global footprint, and track record with the global battery producers set us up well to build an incumbent position in these geographies. We continue to believe these geographies will become large over time, driven by penetration of EVs and hybrid vehicles, as well as the growth of energy storage batteries for data center and grid applications. This application remains an important strategic priority for us, and we intend to continue to invest prudently to build long-term value. Moving now to strategic growth activities and other areas of performance chemicals, You will recall that we highlighted a number of important applications within this segment during our last investor day. Two of these priority areas are focused on the infrastructure and alternative energy sectors. Both of these sectors are growing at multiples of GDP, supported by strong macro tailwinds. In the infrastructure space, the wire and cable application is experiencing strong growth driven by electrical grid renewal, growth of power generation demands due to data centers, and the development of alternative energy sources, such as wind and solar. Our conductive carbons are a critical material in the performance of power distribution cables, and Cabot has built a strong reputation for quality, performance, and reliability. On a year-to-date basis through Q3, our volumes in this application have grown by 15% compared to the same period last year. In the alternative energy space, Cabot is a leading provider of treated fume silica for use in adhesive formulations that are critical in the manufacturing of wind turbine blades. Growth in this application is being driven by investments in alternative energy generation. And through the first three quarters of fiscal year 2025, our volumes have increased by 8% compared to the same period last year. Our strong product offering, global footprint, and reputation for performance and quality have resulted in Cabot achieving a strong incumbent position with many leading customers. I am very pleased with our strategic developments and am confident that these pursuits will continue to build our long-term potential for sustained value creation. I will now turn it over to Erica to discuss the financial results for the quarter. Erica?