ICL Group Ltd

Good morning, ladies and gentlemen, and welcome to the ICL Fourth Quarter 2025 Earnings International Conference Call. At this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. I would now like to turn the conference call over to Peggy Riley-Sarp. Vice President of Global Investor Relations. Please go ahead.

Thank you. Hello, everyone. I'm Peggy Riley-Sarp, Vice President of Global Investor Relations for ICAIL Group. I'd like to welcome you and thank you for joining us today for our earnings conference call. This event is being webcast live on our website at icl-group.com, and there will be a replay available a few hours after the live call, and a transcript will be available shortly thereafter. Earlier today, we filed our our presentation with the securities authorities and the stock exchanges in both Israel and the United States. Those reports, as well as the press release and our presentation, are also available on our website. Please be sure to review the disclaimer on slide two of the presentation. Our comments today will contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are not guarantees of future performance. The company undertakes no obligation to update any information discussed on this call at any time. We will begin with a presentation by our CEO, Mr. Anad Aronson, followed by Mr. Abraham Nahab, our CFO. After the presentation, we'll open the line for a Q&A session. I would now like to turn the call over to Anad.

Thank you, Peggy, and welcome everyone to review our fourth quarter 2025 earnings. We delivered a solid finish to the year and achieved our annual guidance target with $1 billion of specialty-driven EBITDA. In the fourth quarter, we also made significant progress towards our new strategic principles, which you can see on slide three. This includes the acquisition of Bartek Ingredients, the global leader in food-grade malic and turmeric acid. Bartek serves hundreds of customers and distributors in the food, beverages, and other end markets, and distributes its products to more than 40 countries worldwide. This acquisition allows us to extend our portfolio deeper into specialty food solutions. It also helps to position us for further growth as we leverage our existing global food presence to extend into other food ingredient segments. It further advances our recently refined strategy, which focuses on the significant growth engines of specialty crop nutrition and specialty food solutions. two areas where we already have deep experience and broad exposure. We will continue to seek additional non-organic growth opportunities in these two markets, driven by a commitment to creating long-term value and sustainable growth for our shareholders. At the same time, we will stay focused on our mission to maximize our core business segments, and this includes our potash resources. As you know, we signed an MOU with the State of Israel regarding the Dead Sea concession assets in November of last year. In January of this year, we signed a binding agreement based on the principles agreed upon in the NOU. We secured compensation for our assets at the Dead Sea and established certainty on the timing of this payment. It also included the insurance of Brom and Supply through at least 2035. Additionally, as part of our strategic efforts, we have been conducting a review of our capital allocation priorities and re-evaluating less synergetic and low potential activities. As a result, in the fourth quarter, we made several adjustments with the majority related to advancing our new strategic principles. These were essentially moving ICL forward and designed to help fund our two profitable growth engines. These shifts in our priorities will help us to redirect our resources to where better aligned opportunities. Adjustments included the discontinuation of ICL's LFP battery material projects in St. Louis and in Spain, the closure of a minor R&D facility in Israel, and the initiation of a sale process for operations in the UK. We expect to share updates on our strategic efforts throughout 2026 and look forward to strengthening and growing ICL for the long term. Now, if you will please turn to slide four for a brief overview of the quarter. Sales were $1,701,000,000, up 6% year over year, with all four segments delivering sales growth. For our industrial products, phosphate solutions, and growing solutions segments, Sales of $1,281,000,000 were up 4%. We remain committed to growing our leadership position in these three segments. Consolidated adjusted EBITDA was $380,000,000 in the fourth quarter, and this amount improved 10% year over year. For the quarter, EBITDA for our industrial products, phosphate solutions, and growing solution segments was $249,000,000. In the fourth quarter, adjusted diluted earnings per share were $0.09 and up 13% versus last year. Operating cash flow of $340 million improved 2% on sequential basis. In general, the quarter was in line with expectations with year-over-year growth in key adjusted financial metrics. Prices continued to increase for bromine, potash, and phosphate fertilizers in the fourth quarter. Similar to the previous three quarters, overall performance remains varied across the wide array of end markets and region research. Turning to slide five and the review of annual results. Consolidated sales for 2025 were $7,153,000,000 and up 5% versus 2024. Sales for industrial products, phosphate solutions, and growing solutions were $5,000,000,000 $650 million in 2025, also up 5%. Full year EBITDA of $1,488,000,000 was up slightly, while EBITDA for industrial products, phosphate solutions, and growing solutions came in at $1,021,000,000. Adjusted diluted EPS was $0.36 for 2025, and we delivered operating cash flow of $1,056,000,000. During the course of 2025, we faced shifting macro forces and industry issues while simultaneously achieving our goals. From an ITL perspective, we gained significant clarity regarding the value of the ZC assets, which I just discussed. Also, as previously mentioned, we completed a comprehensive review of the company and identified two strategic growth engines, specialty crop nutrition and specialty food solutions. We intend to expand in these two areas while continuing to benefit from our distinctive global presence and regionally diversified operations. Now let's review our division and begin with our industrial products business on slide six. For the full year, sales of $1,254,000,000 were up slightly year over year with EBITDA of $280,000,000. For the fourth quarter, sales of $296,000,000 were up 6%, with EBITDA of $68 million. So, a solid end to a good year. In the fourth quarter, bromine prices maintained their upward trajectory, even as some end markets, such as building and construction, remained soft. For flame retardant, sales of both our brominated and phosphorus-based solutions were flat versus the prior year. For bromine-based products, higher prices were offset by lower volumes due to continued soft demand. For cells of phosphorus-based products, higher volumes and prices in the U.S. were unable to fully offset lower volumes in other regions, mainly in Europe. Cells of clear brine fluids, which are used by the oil and gas industry during well completion, remained solid and were driven by increased demand in South America and Europe. Specialty mineral sales increased on strong pre-season demand for magnesium chloride after an early snowfall in the fourth quarter in the U.S. This was followed by a massive winter storm in North America in January. Turning to our potash division on slide 7. For the full year, sales of $1,714,000,000 were up 4%, with EBITDA of $552 million up 12%. In the fourth quarter, potash sales of $473 million were also up 12% year-over-year, while EBITDA of $150 million increased 15%. Our average potash price for the fourth quarter was $348 CIF return. This amount was up more than 20% year over year. Potash sales volume of 1,200,000 metric tons in the fourth quarter were up roughly 15% on annual basis. This marks a strong finish to 2025 as we successfully addressed operational issues in the Dead Sea related to the war. For our Spanish operations, our focus on deep bottlenecking and optimizing helped us to improve reliability and advance our production goals. These efforts also helped us to deliver a quarterly production record in Spain in the fourth quarter. In the fourth quarter, we also signed a contract with our Chinese customers for supply at $348 per metric ton, which is in line with other recent industry contract settlements. Finally, potash affordability remained attractive in the fourth quarter, and we continued to maximize the profitability of our potash resources. Whenever possible, we prioritize potash supply to the best global markets. Now turning to review of the phosphate solutions division on slide 8. For 2025, sales of $2,333,000,000 were up 5%. However, EBITDA of $528,000,000 was impacted by higher sulfur costs. In the fourth quarter, sales increased 2% to $518,000,000, while EBITDA came in at $121 million. Food specialty sales increased slightly in the fourth quarter versus the previous year and reflected growing volumes in North America and Asia as we leverage our regional expansion strategy. In the fourth quarter, Our overall food business gained additional sales and also expanded its new product pipeline for dairy in the US and EMEA. We also saw an increase in global processed meat sales across the US and the EU. In China, our food sales increased 15% in the fourth quarter, our best quarter of the year. For 2025, sales were up 12% as our business expansion in this region has been successful since its debut. In total, we expanded our food project pipeline with nearly 40 new solutions since mid-2025. While we are committed to growing this business organically, you can also expect us to continue to evaluate M&A opportunities. As I mentioned earlier, in January, we completed our acquisition of approximately 50% of Bartek ingredients, and for 2026, we are targeting a wide array of growth options. This includes expansion into emulsifiers along with other R&D efforts, such as the development of a high-protein drink stabilization system for GLP-1 users. We expect additional growth to come from portfolio expansion in seafood and soy protein, and as the segment looks to deliver more localized food solutions to emerging markets. In China, our YPH joint venture benefited from both higher prices and volumes, and an increase in demand for battery materials in the fourth quarter. We also celebrated the 10th anniversary of our Chinese partnership in January of this year. Overall phosphate specialties performance continued into the fourth quarter as expected, with most regions remaining stable. However, market softness was maintained in Europe, a trend that lingered as anticipated. Higher costs of raw materials, especially sulfur, persisted in the fourth quarter and showed no signs of abating in 2020-6. This brings us to our growing solutions business division on slide 9. Trends for 2025 were $2.63 billion and improved 6% year-over-year, while EBITDA of $213 million increased 5%. This growth was due to our continued strategic focus on global specialty solutions, which have been customized for our customers on a regional basis. For the fourth quarter, growing solution sales increased 6% to $467 million, while EBITDA of $60 million was up 18% versus the prior year. In the fourth quarter, we saw profit improvement in both North America and Europe. In North America, higher prices helped drive an increase in profits. In Europe, we continued to benefit from our successful product mix strategy, which is focused on our higher margin products. Sales in Asia also improved in the fourth quarter, but rising raw material costs impacted profits as expected. In Brazil, the overall market remained under pressure as farmers faced affordability issues and distributors ship their buying behavior. Although this did impact our profitability, sales performance remained solid, and we were able to expand our specialty market share. I would ask you to now turn to slide 10 and some key takeaways. We have already made progress in advancing our strategic principles, which we announced in the third quarter. We added basic ingredients to our specialty food solutions portfolio, and you can expect to see more acquisitions in the coming year. We also took a comprehensive look at our existing portfolio and elected to discontinue our downstream LFP battery materials expansion, which we announced in the third quarter. In the fourth quarter, we initiated a sale process for our Volbi operations in the UK, in the hope of getting this facility into the best hands for the future. During 2025, we also worked diligently to provide clarity around the 2030 Dead Sea Concession process, which I discussed earlier. We continue to believe that ICL is the most suitable candidate to be awarded the future concession. We currently intend to participate in this process once it begins, assuming of course that the terms are economically viable and we will ensure stable regulatory environment. I would now like to look outside of ICL towards the markets where we operate. Across our minerals, which include potash, phosphate and bromine, we see prices are stable to improving and these trends are expected to continue into the first quarter of 2026. For our specialty phosphate, we are seeing pressure related to both competitive forces and higher raw material costs, and we are actively monitoring and reacting to these dynamics. While some cost inputs are rising, the sulfur market is experiencing exceptional volatility on a global basis. Prices have surged to multi-year highs driven by supply and geopolitical issues. These increases are causing issues across several of our businesses and significantly impacting other agriculture and chemical manufacturers. At ICL, we are actively working to mitigate higher costs, including sulfur, and we will keep you up to date on our efforts as the year progresses. We are also experiencing pressure as the shekel continues to strengthen versus the US dollar. This makes it more costly for us, to do business in Israel as a dollar-dominated company. However, we are using hedging tactics to help eliminate some, but not all, of this exposure. Now, before turning the call to Avira, I would ask you to turn to slide 11 and review our guidance for 2026. For this year, we expect consolidated EBITDA, comprising all four of our business segments, to be between $1.4 billion to $1.6 billion. As the price of potash has stabilized over the past few years, we believe providing consolidated guidance is now more relevant. For potash sales volumes, we expect this amount to be between 4.5 million and 4.7 million metric tons as we continue to benefit from the operational improvements made at the Dead Sea and in Spain in 2025. Finally, we expect our annual adjusted tax rate to be approximately 30% in 2026. And with that, I would like to turn the call over to Aviram for a brief financial overview.