Cabot Corporation

Good day, ladies and gentlemen. Thank you for standing by. Welcome to the fourth quarter fiscal year 2026 Cabot Earnings Conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, we'll open up for questions. To ask a question during a session, you will need to press star 101 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1 again. Please be advised that today's call is being recorded. I'm going to turn it over to our first speaker, Robert Rist, Vice President of Investor Relations. Please go ahead.

Thank you, Victor. Good morning. I'd like to welcome you to the Cabot Corporation Earnings Teleconference. With me today are Erica McLaughlin, CEO and President, and Steve Delahunt, Interim CFO and Treasurer. Last night we released results for our fourth quarter of fiscal 2026, 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 this 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 the risks and uncertainties that could cause actual results to differ materially from those projected in such statements. Additional information regarding these factors appears under the heading forward-looking statements in the press release we issued last night and in our annual report on Form 10-K for the fiscal year ending September 30, 2025 and in subsequent filings we make with the SEC. all of which are also 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. Any non-GAAP financial measure presented should not be considered to be an alternative to a financial measure required by GAAP. Any non-GAAP financial measure 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. Also, as we typically do each year, I'd like to remind you that over the next several weeks in conjunction with the vesting of restricted stock awards under our long-term incentive equity program, officers of the company will be selling shares to pay tax and other obligations related to their rewards. I will now turn the call over to Erica who will discuss the fourth quarter highlights, followed by several company and business updates. Steve will review the fourth quarter financial highlights and the business segment results. Following this, Erica will provide comments on our fiscal 2027 outlook and then open the floor to questions. Erica?

Thank you, Rob. Good morning, ladies and gentlemen, and thank you for joining us today. Before we get into our fourth quarter results and full year results, I'd like to say a few words about our recently announced leadership transition. I'm honored to be joining you today for my first call as Cabot CEO and I'm excited about what's ahead. I'd also like to thank Sean for his leadership and for his support during this transition. We have strong businesses and a talented, experienced team and I'm fortunate to have that foundation to build on. Having the various roles I have had at Cabot over the past 24 years, I know our businesses and our team well, and you should expect continuity in how we manage the company, including our commitment to a strong balance sheet, an investment-grade credit profile, and our balanced capital allocation framework. My focus is on investing behind growth opportunities while staying disciplined in how we run the business to deliver long-term value for our shareholders. I'll share more on our priorities for fiscal 2027 later in the call. Now starting with our fiscal 2026 results, we finished the year with solid financial performance. In the fourth quarter, we delivered adjusted EPS of $1.61 with reinforcement materials generating $87 million of segment EBIT and performance chemicals delivering $60 million. We also generated $143 million in cash flow from operations during the quarter and returned $70 million to shareholders. For the full year, adjusted EPS was $6.42, reflecting strong execution across the portfolio despite a dynamic operating environment. Reinforcement materials delivered $379 million of segment EBIT and performance chemicals generated $235 million. Importantly, our earnings performance translated into strong cash generation. We generated $421 million of cash flow from operations for the year, giving us the flexibility to continue investing in the business while also returning significant cash to shareholders. In total, we returned $243 million to shareholders during fiscal 2026, including $97 million through dividends and $146 million through share repurchases. Taken together, these results demonstrate the strength of our portfolio, our focus on disciplined execution, and the cash generating capability of the company. Our progress this year also extended beyond our financial results. We advanced a number of strategic priorities that we believe strengthen our business and position us to create value over the long term. Let me highlight a few of those accomplishments. First, we successfully completed the acquisition of a reinforcing carbons facility in Mexico from Bridgestone. This acquisition strengthens our regional manufacturing footprint and enhances our ability to serve customers in the Americas. The facility is performing well, integration activities have been completed as planned, and we remain on track to meet our financial targets. The long-term supply agreement with Bridgestone also provides a strong foundation as we move forward. Our progress this year also extended to our sustainability performance with continued recognition from external third parties. For the sixth consecutive year, we earned a platinum sustainability rating from Ecovatus, its highest level of recognition. Ecovatus assesses the sustainability performance and management systems of more than 150,000 companies across more than 185 countries. and our platinum rating places Cabot among the top 1% of companies assessed globally. This year we improved our overall score by five points, our largest year-over-year improvement to date, while once again earning an outstanding rating in both the environment and labor and human rights categories. We were also recognized by the American Chemistry Council with two 2026 Responsible Care Awards. We received the Waste Management and Water Stewardship Award for an initiative at our Franklin, Louisiana facility and nearly all of our U.S. manufacturing facilities received the ACC Facility Safety Award based on their 2025 safety performance, reflecting our continued focus on strong safety practices across our operations. In addition, we also took actions to enhance our financial flexibility in a dynamic environment Our longstanding investment-grade credit profile enabled us to upsize our corporate credit facility and refinance our debt maturity on favorable terms. We increased our corporate credit facility to $1.3 billion, completed a $350 million senior notes offering at a 4.95% coupon, and ended the year with $1.5 billion of liquidity. This provides us with significant flexibility as we navigate the current environment and continue investing behind our strategic growth opportunities. And finally, Performance Chemicals had another strong year of strategic execution and financial performance, delivering a new level of segment EBIT. These results reflect a focused effort to grow in key end markets, such as batteries and electronics. Our progress in Battery Materials is a good example of how we are leveraging our global asset footprint and strong product development capabilities to drive meaningful growth. Let me spend a few minutes on the milestones we achieved this year. As we've highlighted on recent calls, Battery Materials represents an important long-term growth opportunity for Cabot. Fiscal 2026 was another year of meaningful progress both financially and strategically. For the year, Battery Materials delivered 43 million of EBITDA with an EBITDA margin of 26%. We are pleased with both the earnings contribution and the attractive margin profile we are achieving as we grow the business. These results were supported by strong customer demand and higher volumes and reflect the strength of our differentiated product portfolio, our deep and expanding relationships with leading battery customers, and our global manufacturing and technology footprint. One of the examples of where we built momentum with customers is the multi-year supply agreement with Powerco that we announced this year. This was an important milestone that expanded our partnership with a leading European battery manufacturer. The agreement supports Powerco in the localization of the battery supply chain as new lithium-ion battery capacity is built in Europe to serve growing electric vehicle and energy storage demand. Local supply is increasingly important to battery customers as they build more resilient and efficient supply chains. Our global manufacturing and technology footprint enables us to serve customers locally across the major battery regions. During fiscal 2026, we also progressed the number of investments to support this growing customer demand. We are investing to expand our capacity in a disciplined and capital efficient way. As we discussed last quarter, we announced a $125 million capacity expansion program in the U.S. and China. This amount is net of a $50 million grant from the U.S. Department of Energy that was agreed to this year to support our investments for advanced conductive additives capacity at existing U.S. Cabot locations. In addition to the investments we are making in the U.S., we are also adding conductive additives capacity in China to support continued battery growth with key customers. We expect this new capacity to begin contributing to earnings in fiscal 2028. We are making these investments against what we see as an attractive long-term market backdrop with battery demand currently projected to grow at a 15% CAGR through 2030. As we look specifically at fiscal 2027, we see this as an important investment year for battery materials. We expect to continue growing the business from the 43 million EBITDA delivered in fiscal 2026 and expect EBITDA to be in the high $40 million range in fiscal 2027. We expect the capacity expansions that we are making during fiscal 2027 will enable more significant growth in 2028 when the investments come online. So as we look to the future, we believe we are putting the pieces in place for the next phase of growth in battery materials. We have an attractive market opportunity, strong customer relationships, a differentiated product portfolio and targeted capacity investments that will expand our ability to serve customers across all major regions as demand grows. With that, I'll turn the call over to Steve to take you through our fourth quarter financial results and segment performance in more detail. Steve?