Olin Corporation (OLN) Q3 2025 Earnings Call Transcript

Oct. 28, 2025 3:01 PM ETOlin Corporation (OLN) StockOLN

Q3: 2025-10-27 Earnings Summary

EPS of $0.39 beats by $0.30

 | Revenue of $1.71B (7.78% Y/Y) misses by $18.08M

Olin Corporation (OLN) Q3 2025 Earnings Call October 28, 2025 9:00 AM EDT

Company Participants

Steve Keenan – Director of Investor Relations
Kenneth Lane – President, CEO & Director
Todd Slater – Senior VP & CFO

Kenneth Lane
President, CEO & Director

Thank you, Steve, and thanks to everyone for joining us today. Let’s start with Slide 3 and our third quarter highlights. During the third quarter, we delivered robust results, reflecting strong performance in our Chlor Alkali products and Vinyls business, partially offset by ongoing weakness in our Epoxy and Winchester commercial ammunition businesses. We remain disciplined in our value-first commercial approach and operated our assets safely, reliably and efficiently.

Team Olin is more committed than ever to executing our value-first commercial strategy, maximizing cash generation and delivering on our capital allocation priorities while preserving our strong leverage to a demand recovery. During the third quarter, we continued to generate positive operating cash flow and with a focused effort by Team Olin achieved a significant milestone by securing our eligibility for Section 45V clean hydrogen production tax credits, which Todd will discuss shortly.

Now let’s turn to Slide 5 for a look at our Epoxy results. Global Epoxy resin demand remains weak, and we continue to face significant headwinds in both Europe and the U.S. regions, facing subsidized imported resin from Asian producers. U.S. demand has been more resilient than Europe. And with the removal of Epoxy resins from Annex II tariff exemptions, we are seeing traction with U.S. price increases. In spite of these market dynamics, Olin’s third quarter formulated solutions volume improved sequentially.

Fourth quarter planned maintenance presents a $14 million sequential headwind to Epoxy earnings. As we execute this turnaround safely and efficiently, the Epoxy team will focus on cash management as they reduce year-end inventories. Olin’s new Stade, Germany supply agreement will provide improved economics for our European production, similar to the benefits from our integrated operations at Freeport.

Starting in January 2026, the new agreement is expected to provide an annual adjusted EBITDA benefit of approximately $40 million. With rationalization of capacity in Europe, we are seeing opportunities to grow our participation and we’ll do so at a value that is attractive.

Todd Slater
Senior VP & CFO

Our Epoxy business continued to grow its formulated solutions volume as persistent headwinds from subsidized Asian imports impacted both the United States and European markets. As expected, Epoxy’s third quarter results included higher operating costs from unabsorbed fixed manufacturing expenses incurred from planned inventory reductions.

Kenneth Lane
President, CEO & Director

Thanks, Todd. Let’s finish up with Slide 9 and our outlook for the fourth quarter. In our CAPV business, through actions we’re taking, we expect to see stable ECU values in the face of seasonally weaker demand. Our Epoxy business remains challenged, but will begin to see improvement as we enter the new year and benefits accrue from our new Stade supply agreement, some pricing improvements in the U.S. market and volume gains in Europe following capacity rationalizations.

Patrick Cunningham
Citigroup Inc., Research Division

Maybe just on Epoxy. Obviously, still continues to be challenged by some price competitive Asian imports. Maybe you’re getting a little protection here that gives you a platform for price. But how should we think about earnings levels into next year? You have some nice savings actions at Stade. You have maybe some incremental volume opportunities with competitors leaving the space in Europe. So I’m just how are you thinking about the framework for next year on Epoxy?

Kenneth Lane
President, CEO & Director

Patrick, thank you for your question. I hate to get too far out over my skis here, but I’m probably more optimistic on Epoxy than I have been in the last 1.5 years. But that’s not because the market is improving. It’s really because of the actions that we’ve taken as Olin over the last few years to be able to rightsize our cost base, rightsize our capacities. We do have a very good integrated business that has allowed us to survive when others can’t. And so that’s what happens in the trough. You start to see people that are not as competitive close capacity until demand begins to recover, and we’re positioned very well as that happens.

But in the meantime, with all the cost reductions that we’re going to realize, both in Europe and frankly, in the U.S., along with a little bit of a tailwind around tariffs, I do expect that going into next year, we’re going to see a pretty significant improvement from a very low level for Epoxy. But I think that’s a business where, yes, I’m going to be very eager to see that improvement next year, which should be quite positive versus this year. And as a percentage, will probably be better than any other business we’ve got.

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