Olin Corporation

Good morning, and welcome to Olin's Corporation's second quarter 2026 earnings conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. Following today's brief opening comments, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your touch-tone phone. To withdraw your question, please press star, then two. Please note, this event is being recorded. I would now like to turn the conference over to Steve Keenan, Olin's Director of Investor Relations. Please go ahead, Steve.

Thank you, operator. Good morning, everyone. We appreciate you joining us today to review Olin's second quarter 2026 results. Please keep in mind that today's discussion, together with the associated slides, as well as the question and answer session that follows, will include statements regarding estimates or expectations of future performance. Please note these are forward-looking statements and that Olin's actual results could differ materially from those projected. Some of the factors that could cause actual results to differ from our projections are described without limitations in the risk factors section of our most recent Form 10-K and in yesterday's second quarter earnings press release. A copy of today's transcript and slides will be available on our website in the investor section under past events. Our earnings press release and related financial data and information are available under press releases. With me this morning are Ken Lane, Olin's President and CEO, and Todd Slater, Olin's CFO. We'll start with some prepared remarks, then we'll look forward to taking your questions. Let me now turn the call over to Olin's President and CEO, Ken Lane.

Thank you, Steve, and thanks to everyone for joining us today. We appreciate your interest in Olin and taking the time to join us on such a busy morning. Let's begin with some highlights from the second quarter on slide three. On June 16th, we were very pleased to announce our planned merger with Huntsman, bringing together two highly complementary businesses to create a world-scale, vertically integrated, North American-focused chemical leader with more than $12 billion in sales. The second quarter also saw the conflict involving Iran disrupt chemical supply chains and increase prices. Markets rebalanced as the quarter progressed, although significant uncertainty remains. Acoustic soda and EDC export pricing were the second quarter bright spot, reflecting the supply chain disruptions at the beginning of the quarter. This was partially offset by an unplanned VCM shutdown at our Freeport, Texas facility. Epoxy also achieved higher pricing across all products during the second quarter as hydrocarbon feedstock costs rose and availability tightened. Epoxy demand remained weak in Europe, but the U.S. saw moderate seasonal demand improvement in the quarter. Winchester's commercial ammunition recovery continues as year-over-year demand improves and our pricing initiatives to offset rising metals costs start to gain traction. Domestic and international military sales continue to show strength. Against a backdrop of weak demand and volatile global events, Olin's self-help efforts remain top of mind. Our value-first commercial approach continues to preserve ECU values while our Beyond 250 initiative is delivering structural cost reductions. Now let's turn to slide four for an update on our recently announced merger with Huntsman, which creates a $12 billion vertically integrated, cost-advantaged North American chemicals leader. Since announcing the transaction, We've made significant progress in a short period of time. We filed our definitive proxy on July 13th, and Olin shareholders have already begun casting their votes as we approach the August 25th special shareholder meeting. Todd and I have spent recent weeks on the road with the Huntsman management team, meeting with both Olin and Huntsman shareholders, listening to feedback and discussing our value creation thesis. The response has been very supportive and reinforces our excitement about the deal. In the third quarter, we'll begin pre-closing integration planning led by Todd. This is a very important first step toward realizing the $400 million of synergies quickly following the close, which we continue to expect in the first half of 2027. Now let's turn to slide five for a closer look at our chloralkali products and vinyl second quarter performance. Early in the quarter, the Iran conflict drove supply chain interruptions and dramatically higher feedstock and energy costs, resulting in higher prices for many products. As supply chains rebalanced during the quarter, export pricing for both EDC and caustic soda trended lower but remained above pre-conflict levels. These export price trends will offset stronger domestic caustic pricing in the third quarter. We expect product availability to tighten in the fourth quarter, driven by persistently higher feedstock and energy costs, as well as several planned industry shutdowns. As discussed on our Q1 earnings call, we had an unplanned outage in early May at our Freeport, Texas, BCM plant. While the outage was disappointing, it was an isolated equipment issue that we've addressed. We were able to restart the plant by mid-May, but BCM will be running at reduced operating rates through the third quarter while we complete final repairs. This outage resulted in a $40 million penalty to second quarter adjusted EBITDA and will have an estimated $20 million impact on the third quarter. Second quarter merchant chlorine sales improved seasonally, supported by stronger water treatment, refrigerant, and other derivative demand. During the third quarter, several planned chlorine customer shutdowns will reduce volumes, but chlorine pricing remains stable. Finally, we continue to make very good progress on our Beyond 250 structural cost savings initiatives, and we're on track to deliver on our commitments. Turning to slide six, let's review our epoxy results. During the second quarter, our epoxy business posted its best results in more than three years. As the Iran conflict unfolded, our epoxy team implemented price increases to offset rising raw material and transportation costs. Security of supply became paramount to customers, supporting Olin's strategy to grow our epoxy participation in both the U.S. and Europe. During the second quarter, U.S. epoxy resident demand experienced moderate seasonal improvement, while European demand remained flat. Our epoxy cost initiatives continue to pay off. Between our new Stade Germany supply agreements and our Guarujá Brazil plant closure, we've reduced epoxy structural costs by more than $50 million per year. These actions, in combination with our commercial strategy for increased participation, have returned this business to positive earnings. Now let's take a look at Winchester on slide number seven. Monthly out-the-door commercial ammunition sales have improved year over year as consumer demand strengthens. Winchester continues to increase prices to offset rising raw material costs, particularly copper and brass. Both of these have resulted in year-over-year improvement to adjusted EBITDA. Winchester is continuing its disciplined approach to working capital and inventory management as we see our commercial backlog grow. The third quarter is typically our strongest for commercial ammunition demand due to the fall hunting season. and we expect that to drive sequential earnings improvement. Domestic and international military ammunition and project sales continue to be strong. I'll now turn the call over to Todd for a look at our financial highlights.