GrafTech International Ltd.

Hello everyone, thank you for joining us and welcome to the GrafTech second quarter 2026 earnings conference call and webcast. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. I will now hand the conference over to Mike Dillon, Vice President of Investor Relations and Treasurer. Please go ahead.

Good morning and welcome to Graph Tech International's second quarter 2026 earnings call. Thank you for joining us. Joining me on the call are Tim Flanagan, Chief Executive Officer, and Rory O'Donnell, Chief Financial Officer. And we'll begin with opening comments on our key strategic initiatives. Rory will then provide color on our quarterly results, outlook, and other financial matters. After closing comments by Tim, we will then open the call to questions. Turning to our next slide, As a reminder, our comments today may include forward-looking statements regarding, among other things, performance, trends, and strategies. These statements are based on current expectations and are subject to risks and uncertainties. Factors that could cause actual results to differ materially from those indicated by forward-looking statements are shown here. We will also discuss certain non-GAAP financial measures in these slides including the relevant non-GAAP reconciliations. You can find these slides in the investor relations section of our website at graphtech.com and a replay of the call will also be available on our website. I'll now turn the call over to Tim.

Good morning, everyone, and thank you for joining us today. The second quarter marked another period of meaningful progress for GrafTech. We delivered strong sales volume growth, increased production and capacity utilization, and further improved our manufacturing cost structure. We also reaffirmed our full year sales volume and cost expectations while advancing the commercial and strategic initiatives we introduced earlier this year. to improve both profitability and strengthen our business. In addition, we believe the underlying fundamentals of our end markets are moving in a positive direction. We are taking decisive actions to strengthen our business in the areas where we can make the greatest difference today. Taken together, we believe that this positions GrafTech to deliver stronger financial performance as industry conditions continue to improve. This morning, I'd like to begin with an update on our strategic priorities. then provide our perspective on the steel market and broader industry environment before discussing safety and turning the call over to Rory for review of our financial results. When we spoke with you three months ago, we introduced a series of strategic initiatives designed to strengthen GrafTech's earnings power while supporting healthier long-term industry fundamentals. Those priorities build on the commercial, operational, and financial improvements we have made over the past several years and I'm pleased with the progress we are making across each of them. First on the commercial front, we are pleased to have delivered 8% year-over-year sales volume growth this quarter, including a 29% increase in the United States, which remains our strongest commercial region. We continue to implement our previously announced price increases on uncommitted volume, which represents an important first step to restore pricing to the levels that safeguard regional graphite electrode production and the continuity of supply for our customers. As noted in our earnings release, since announcing these pricing actions near the end of the first quarter, we have secured customer commitment at prices that are on average more than 15% above those achieved prior to the announcement. With more than 90% of our anticipated volume already committed in our order book, mostly at price points that reflect market pricing at the end of the fourth quarter of 2025, this will not translate immediately into higher realized pricing. These higher price commitments were reflected in our financial results over time as those shipments occur. Ultimately, the acceptance of higher prices is a strong indicator that our customers recognize the importance of securing a reliable supply of high-quality graphite electrodes backed by world-class technical support. Second, with respect to trade policy, we continue to advocate for fair trade and more balanced competitive conditions across the industry. as evidenced by our support of graphite electrode trade cases in key commercial jurisdictions. This includes the trade case filed earlier this year in the United States related to imports of large diameter graphite electrodes at unfair prices. We remain confident that the Department of Commerce and International Trade Commission will complete a thorough investigation and take meaningful and necessary actions to address these unfair trade practices. This will further support long-term market stability. As a reminder, in April, the ITC announced its preliminary determination that the domestic industry is being materially injured by imports from China and India, and that case is now with Commerce for its investigation. Commerce is expected to announce its preliminary countervailing duty determination early next week, with any such duties becoming effective on a provisional basis shortly thereafter. More importantly, we expect Commerce will announce its preliminary determination on anti-dumping duties by the end of September. As we've previously noted, the trade petition filed earlier this year estimated dumping margins for Chinese and Indian electrode imports of 147% and 74% respectively. Third, with respect to our operations, over the past several years, we've significantly improved the efficiency and competitiveness of our manufacturing network through higher productivity, improved operating discipline, and ongoing cost improvement initiatives. That progress continued during the second quarter as we increased production, achieved our highest quarterly capacity utilization levels since 2022, and further improved our manufacturing cost structure. For the full year, despite cost headwinds driven by ongoing geopolitical conflicts, we are reconfirming our guidance of a modest year-over-year reduction in our cash COGS. These improvements strengthen our competitiveness in today's market, while positioning GrafTech to generate greater earnings and cash flow as industry conditions continue to improve. Ultimately, as we assess the progress of our strategic initiatives and the broader market environment, we will continue to evaluate both the production capacity we maintain and the volume we deliver to the market. As an industry leader, we are prepared to take actions to align supply with sustainable industry economics and support the long-term viability of our business. Finally, with respect to emerging opportunities, we're positioning GraphTech to capitalize on what we believe is an important inflection point across the graphite electrode and petroleum needle coke industries. Recognition of the strategic importance of synthetic graphite for both economic and national security purposes continues to grow, and that's being driven by two major trends. First, graphite electrodes are indispensable to electric arc furnace steelmaking, which continues to gain share globally. Thank you for joining us today. We believe these dynamics reinforce the value of GRAPHTEX vertical integration, which enhances supply reliability for our graphite electrode customers and positions us to benefit from improving needle coke market fundamentals. The reality is that economic and national security risks associated with dependence on concentrated and non-market based supply chains are becoming increasingly clear. Against this backdrop, we welcome the efforts of as they develop a joint critical mineral action plan. This action plan establishes a framework for the two trading partners to coordinate policies that support resilient supply chains for critical materials, such as synthetic graphite, while exploring potential trade mechanisms, including border adjusted price floors. Evidence in trade cases demonstrates that appropriate and others. These include ongoing engagement with the U.S. administration at various levels to help inform and shape critical mineral policies as they relate to graphite electrodes and battery materials, and specifically as it relates to graph tech, actively exploring the opportunity to leverage existing industrial assets in available graphitization capacities. while demonstrating our leadership in carbon and graphite technology and stressing the importance of preserving this know-how. Within the EU, this includes supporting the ongoing efforts of the European Carbon and Graphite Association as they advocate for a stronger European steel and graphite electrode industry. And more broadly, continuing to demonstrate our technical capabilities through ongoing engagement with research institutions and commercial partnerships. which include collaboration with those in the energy storage industry to utilize our expertise and capacity to further their strategic objectives and evolving business models. Turning to slide five, let me spend a few minutes discussing the broader steel market because the health of the steel industry remains the primary driver of long-term graphite electrode demand. Although conditions vary by region, the overall direction remains encouraging. Global steel production, excluding China, increased approximately 2% compared to the second quarter of last year. In the United States, steel production is up 6% year-to-date, supported by favorable trade policy and resilient domestic demand. Reflecting these dynamics, quarterly steel capacity utilization in the U.S. reached 80% for the first time since the second quarter of 2022. Conditions in Europe remain more challenging, although we continue Overall, the data we're seeing today is increasingly consistent with the view we've shared over the past couple quarters, that steel fundamentals outside of China are steadily improving. Looking beyond today's market conditions, we continue to believe medium and long-term outlook for the steel industry remains constructive. As shown on this slide, a number of factors have the potential to support stronger steel demand over the coming years. These include continued infrastructure investment, increasing defense spending, The implementation of the carbon border adjustment mechanism in Europe, easing monetary policy, improving macroeconomic conditions, and additional trade protections in several key regions. No single catalyst will determine the pace of recovery. Rather, it's the combination of these factors that gives us confidence in the industry's longer-term trajectory. That perspective is also reflected in the World Steel Association's most recent steel demand outlook, which calls for modest growth in 2026 followed by more meaningful acceleration in 2027 for steel demand outside of China. Let me expand briefly on the EU. Europe represents one of our most important commercial regions, and several recent policy initiatives have the potential to materially strengthen steel production over time. Specifically, provisions in the Carbon Border Adjustment Mechanism, or CBOM, implemented in early 2026 will make certain steel imports into the EU less competitive. Further, measures adopted by the EU to significantly increase trade protections on steel became effective at the beginning of July. These measures significantly reduced tariff-free import quotas, increased above-quoted duties to 50%, and strengthened enforcement through melt and pour disclosure requirements. Together, these measures are expected to boost domestic steel production, with some analysts projecting capacity utilization rates in the EU could increase from current levels of just over 60% potentially 75% or higher over time. We believe these protections and a more predictable steel production outlook will give EU steel makers greater confidence to plan beyond the near term and rebuild graphite electrode inventories to more normalized levels. Ultimately, the timing of a broader market recovery is beyond our control. What is within our control is how we position graph tech to benefit as that recovery gains momentum. That is why we remain focused on executing the priorities we discussed this morning. Strengthening our commercial performance, improving our manufacturing efficiency, maintaining financial flexibility, and positioning GrafTech to capitalize on a stronger market environment. Before turning the call over to Rory, I'd like to briefly discuss an area that will always remain our highest priority, which is safety. I've always believed that no business objective is ever more important than ensuring our people return home safely at the end of every shift. And I'm proud of the continued focus of our employees have demonstrated across our global operations. Year to date, our total recordable incident rate has improved 0.35, continuing the significant progress that we've made over the past several years. That improvement reflects a culture in which safety is embedded in every aspect of how we operate and not simply a metric we report each quarter. On behalf of our leadership team, I'd like to thank all of our employees for their dedication to operating safely while delivering for our customers every day. Their commitment is the foundation of everything we accomplish as a company. With that, I'll turn the call over to Rory to review our second quarter results and our outlook in greater detail.