OEC · Orion Engineered Carbons S.A.

Orion S.A. reported a challenging first quarter 2026, with consolidated net sales declining 4% year-over-year to $460 million. The decline was primarily driven by an 11% reduction in price, largely attributable to the pass-through effect of lower year-over-year oil prices, which overshadowed a 2% increase in volumes and 6% favorable foreign currency translation. The company swung to a consolidated net loss of $10 million, compared to net income of $9.1 million in the prior year period, while Adjusted EBITDA fell to $46 million from $66.2 million. Performance diverged significantly between segments: the Specialty Carbon Black segment showed resilience with a 7% increase in Adjusted EBITDA to $27.1 million, driven by higher volumes and positive mix, particularly in the Americas and EMEA. Conversely, the Rubber Carbon Black segment experienced a sharp decline in profitability, with Adjusted EBITDA dropping to $19.0 million from $40.8 million, impacted by calendar 2026 pricing agreements and soft demand in North America. Despite the quarterly headwinds, management expressed confidence in the business's resilience, citing strong order trends and the successful implementation of price increases and surcharges in response to rising energy prices. Consequently, the company raised its full-year 2026 Adjusted EBITDA guidance to a range of $170–$210 million, up from the prior range of $160–$200 million. Cash flow reflected typical seasonal working capital utilization, resulting in an operating cash use of $12 million and a free cash outflow of $48 million for the quarter. The company ended the quarter with a net debt-to-Adjusted EBITDA ratio of 4.2x.