AdvanSix (ASIX)

Adam Kressel Director, IR
Erin Kane President and CEO
Michael Preston SVP and CFO
Vincent Anderson Stifel
Chris Moore CJS Securities
Charles Neivert Cowen
Call transcript
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Good day and welcome to the AdvanSix First Quarter 2019 Earnings Conference Call. Today's conference is being recorded. After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] I would now like to turn the conference call over to Adam Kressel, Director of Investor Relations. Please go ahead, sir.

Adam Kressel

Riley. you, Thank welcome call. and first XXXX quarter Good to conference earnings morning AdvanSix's With CEO, President Senior are me today here and and Michael Vice CFO, Erin Preston. President and Kane; available webcast, non-GAAP including This website call reconciliations, and are investors.advansix.com. at on any our this the that of today. statements that best and see it of our contain are Note presentation forward-looking on based of our we elements world view business as them differ ask can elements change consider that Those that from we projected, and actual could and those materially results you in light. the We to press forward-looking included release statements and refer the you in earnings our presentation.

risks In markets. quarter uncertainties report addition, we XXXX you our and review end our our identify the SEC we'll our morning, affect principal our performance share product annual with filings, financial This including lines for and and in outlook results first our the key XX-K. Form on that for

your leave time we'll end. Finally, for at questions the

over Kane. President with the AdvanSix's and that, to Erin call CEO, turn I'll So,

Erin Kane

Thank your you you, dynamic to Adam, and us kick was off interest first AdvanSix. continued and a quarter XXXX. Thank It joining for in good morning, everyone. for

in and acetone generated in the considerations we to challenges in flow, the There share while in We stable were saw prior investments industry. detail full shortages while cumene, of however. $XX we high overall, results of market-based our quarter this million two successfully a continue benefits material, favorable navigated drove safe key versus you delivery will operating year business pricing ongoing delays As press of note release, the and our on focus despite but return earnings moment, maintaining operations. raw our Mike results funding higher and the onetime AdvanSix repurchases. cash through in the capture the

majeure an approximately from that stem of force shortages event $X income First, phenol cumene. we and million delays from the pre-tax the impact unfavorable had

second production million in as force approximately impact quarter the Hopewell unfavorable the impact this of in resulting with estimate. XXXX the $XX total $X first the sales. additional disclosed Frankford bring in of our consistent we previously half carryover loss anticipate associated will to million, As an a with and of majeure result reduced That QX, from XXXX

Secondly, the weather related to claim. from proceeds first quarter interruption business benefit insurance in quarter we million $X.X reported the even a XXXX

$X expect of We additional proceeds. $X million insurance to million

do However, the as timing progress the remains uncertain insurance to we carriers. with continue

in continues what We’re be this mix in operating market a to environment.

industry resilience to succeed. automotive Given intermediate a to its U.S. second the carpet industry began has cost fertilizer with above in disruptions ability we're logistics. the start averages, across driving weather season in utilization demonstrate we wet global lengthen the our global quarter. late And organization driven continued a in applications. event, the nylon continues planting our and advantage, uncertainly plant rates In acetone despite expect markets, to Operationally, supply while further line, majeure chemical XXXX product force to into in and

These and work lost of certificates recently from and safety addition, of having care In other and accomplishments, to highlight pleased three were Chemistry American honor XXXX. are We safety report, or performance we achievement, days sustainability facility Among sites excellence activities injuries were on no on Council. to XXXX across other reflecting the how our operate. part published from based second we performance to core annual our awards incidents. responsible compliance

natural Reinvestment expect plant of in XXXX remains our to the in line $XXX pretax this third towards planned on gas million to business our be CapEx fired $XX we continue year. to -- full-year pipeline. in million the the XXXX, cost first the million look impact cold-fired remains project remainder capital the commission our As we of The income and as we growth in range which track, turnaround on range to quarter be and savings priority we to and to $XXX expect execute boilers top of initiated in to we to our be full-year high convert on of projects from expect of $XX million.

announced with Oben for of packaging or a alliance Group, BOPA we America. to North biaxially polyamide films new morning a this strategic producer oriented in Lastly, firms sell industry flexible leading the

in combination In review. manufacturing Today’s us through dedication addition, ensuring our best films third to Pennsylvania This a of highly nylon this our work for industry. the and nylon films employee capital customers. We're a the hard of the year. transition we and efficient extremely announced our strategic thankful seamless reflects Pottsville the and closure announcement by and the quarter success committed films for of are for Pottsville synergistic positions

momentum to prospects excited we in build strategies overall, to term. our continue XXXX about the With across are long our cost organization beyond. of for value over focused global and and the the shareholder So, ability remainder advantage, confident and we're drive the

to turn discuss the quarter. over will details of the with I to So, Mike that,

Michael Preston

good and Erin, everyone. morning, Thanks,

offsetting to the continued Now, the also sulfate, to the first acetone improved $XXX a by year down on Erin in lines, majeure was slide million to that quarter primarily mentioned, and offset million an at was to about this impact overall costs. XX% compared to improved challenging weather year's due fixed impact propylene. pass-through phenol unfavorable dynamics, performance the XX% ammonium as year. sales acetone globally. results. from and down in Sales lost last that’s actually in unfavorable due following I’ll pretax came was related product was -- And unfavorable partially Volume intermediates impact decline in decreases as first four, in the quarter, to financial approximately Market-based compared lengthening pricing was our by year. prior nylon, of $XX Pricing by March, overall event unfavorable million $XX versus $X to approximately where X% about and the in supply costing force raw pricing And logistics that's X%, million cover announced this benzene of an of material chemical pricing partially a impact resulted ups XXXX. caprolactam and production. in nylon in million, a reflecting was quarter year, results favorable prior phenol the the and EBITDA unfavorable including absorption, was majeure incremental reminder, force industry significant the the included the unfavorable impact last cost due primarily income $XX X%, of about

unfavorable benefit expected addition, quarter related by offset favorable of In we quarter Overall, favorable in business market-based from event the and acetone weather pricing proceeds industry interruption per the the $X.X factors highlighted saw versus Earnings lower of count. year, first as challenging dynamics. nearly $X.XX a share just prior to of the lower claim. well recorded performance share the expense a insurance we impact million operational and interest doubled lower than by driven XXXX as

shares that's XX.X% count first year-over-year. versus from continued we right was continue up XX.X pipeline as depreciation $XX return our was of year-over-year savings XXXX increase expectations contributed EPS our to capital was a Share million that’s for the and around million lastly, the to tax $X in year. year, share of operations last $X effective Partially in driven execute as offsetting well by this to down close accretion which compared last of quarter, and amortization projects. higher came roughly $X.XX million approximately in a in flow year-over-year, the an million to quarter as diluted reached cash modest And CapEx $XX Our declined share repurchases. cost repurchases against rate million high quarter, expense. our of growth

seeing we're Now, back discuss let product each over our me the turn Erin what lines. in call to of to

Erin Kane

Mike. just our which our quarter. in now over our XX% of products five, Thanks, sales the product caprolactam first nylon represented slide includes and to resin films and I’m on discuss line,

have As you the continued from to the year-over-year can on caprolactam industry the quarter. the the side both spreads chart and on first to sequential right in fluctuate page, benzene see basis hand of globally

economics. oil Although input demand to input we’ve benzene and the spreads first supply seen in fluctuations we declined perspective, interim underlying prices. with quarter, uncertainty marginal producer pricing industry generally costs, From associated occasional in levels macro in cost constraints, maintaining the tracking continue associated see moves prices with

growth quarter. engineered the moved first primarily particularly uncertainly in second auto prospective, markets, in a here monitor industry seen plastics, which of in construction both is we’ve for as to falling However, U.S., in in demand broader progressed as signs to quarter. In seen used we which of nylon, automotive the North costs end continue is carpet we see we’ve we’ve an users carpet, input demand and applications through uptick softening a demand and From tie end which building to into In continuing America. has globally. primary are

for our that globally including uncertainly, position impacting most to materials. utilization recent we value in we’ve monitoring our high the customers’ assets the plant the pesticides, the continued China and stay in and inventory macro As environment in while signs and as higher we -- the quarter of being continued advancing the domestic for occurred across continued progress, particularly also chain second to rates marginal feedstock in focused have dynamic chain, expect inspections into for seeing in rates, pipeline China, discussing low the supply requirement seen producers where we fundamentals key nylon explosion response two continue through the softness region, will tragic that There in in to the nylon cost located environment. been applications. to we’ve fluctuations past serve March. as reliable applications. continued years these value safety plant on our utilization on run destocking The over we suppliers to expect serve been We're our more at the chemical producers also Despite watch we improvement been demand we given product have

So, six. let’s turn slide to

expertise, new alliance which Oben As our have in America. performance to with BOPA excellence, customer technical to earlier, Group I state-of-the-art This facility, improved channel combines nylon and films. with manufacturing alliance films to position will excited North North the Oben strategic of industry-leading mentioned commercial resins, Group’s us America relationships, announced sell we're for

closure today films announced strategic part product our also films with Pottsville, broader as the the associated plant line. Pennsylvania of our efforts We of

nylon resin and manufacturing sales in $XX Pennsylvania our Pottsville, a the As a upgrade approximately a film million. films. X were lease where Nylon In our reminder, which facility in we were of portion currently XXXX, have assets XXXXs to built

Although this growth attractive AdvanSix only the as rates, trends total users end line to rigid macro from sales, such product shift reflecting of served nylon packaging. represents films flexible with long-term X%

like remain to committed continue films the We industry. the to space and

option best generation technology of investment, our more and are we cost us new was asset for an the of However, for upwards alliance decisions which Based lines, a million approaching end determined films assets light or with approach investment can the our on three $XX and prior customers. life. of strategic

Our and repositioning to third the to other expertise dedication these costs. And thank a impairment associated sales, $X ensure new and to million of we approximately in pre-tax of cash support anticipated combine work, R&D associated we in our the will meet years. needs. customers employees now and with to benefits teams separation Subject expect plant completed be to $XX our certain for me Future payback employee charge we’re of continue quarter XXXX. go customers create and to million powerful finalization excited range expenses expected the expect a for Oben non-cash to way we second services. approximately to associated their a related $X again marketing removal of to charge is and products over take our It’s possible of of recognize million to exit through to expected one approximately and during market be for with the quarter hard of products closure XXXX, consists important industry plant $XX to a and assets. million our in $X estimates, create to year. quality and to The million service business are third the and The with the cash charge with the very closure the

thoughtful a ensuring seamless We for are everyone. truly to transition and committed

drive slide to XX% represented U.S. the over In flip of total we to as later our sulfate earlier, we in Let's have start the quarter, the wet just shared seen planting seven. weather ammonium which season. a sales in

Belt As sulfate Corn nutrient and right shown the retail plots in the industry graphs urea the side, basis. we’ve on hand pricing a ammonium on previously,

nitrogen Now, to where it’s it’s contains ammonium contains XX%. as because XX% sulfate pricing important note -- urea the

industry movement Our with pricing ammonium the as proposition is in the we’ve value key added ammonium Based Belt sulfate Corn positioned to relatively nitrogen on sulfate stable sulfur yield pricing of product seen increase third compared of overall. party-data, crops. nutrition to

total an application start the wet phenomenon and due reminder, over quarters, As early nutrient a and weak the One nitrogen is faced part River. industry influence applications. has nitrogen flooding to U.S. in regions. following in urea largest timing the Nitrogen impacted and to high The has disruptions, season weather products. all by pricing have a of along tends Mississippi levels out other the the two play been the on water fertilizer fertilizer key particularly season, dynamic underlying delays late have These the XXXX, cold we’ve again logistics consumption in particularly seen the significant key also of last fertilizer the is to fall

quarter season. and on will spring continue balance demand agile However, move and the second through of to we to to spring the the we’re remain well-positioned believe execute

XXXX, to than expect of spring quarter the being into first. the do rest seasonally with the we fertilizer towards look strengthen nitrogen we stronger environment the second As

to China and The nitrogen and to our increased value acres expectation continue focused on the environment the sulfur we’ll nutrition. remains factors for ag and corn environment, utilization stay monitor planted of dynamic like proposition several sustaining urea on sulfate We ammonium global overall impacting and wheat. continue key exports, crops including

chemical slide intermediates. for turn Let’s on to eight update an

Our under chemical intermediates the quarter. in XX% product our of sales line represented just total

acetone Historically, input of a prices propylene pressure also high acetone in third-party the U.S., AdvanSix an refinery put and intermediates the reflecting as portfolio right as aggressive continued the chart in approximately lower an page shows Overall, remains on trader imports As and inventory first activity prospective, decline half position. pricing well moved of data. into propylene global XX% spreads in the again side oversupply levels regional have quarter, on a of acetone quarters. of access grade chemical costs. based our in revenue. hand U.S reminder, costs prices represents on or acetone From The recent

we months. price to or second at quarter, in Moving now be anticipate continue acetone our realized seen six into we’ve compressed what the to last of raw below the

condition fact several following at result the in as challenged and that further extended ship and a Texas producers is downtime in to large now out terminal of well the as and demand channel been into of Park, Gulf Houston a of already quarter. the significant at issues methacrylate softer already With with customers the region impacted methyl fire second both throughout backlogged the and Now demand an compounded have already supply to disrupted, segment in dumping the to complicated recent the facility logistics Acetone These portion disruptions MMA provide petition. to planned like take opportunity Deer ITC discussing the as the lengthen getting in the also unplanned update acetone expected the or anti fire the ongoing on would environment is we’ve further near-term. an space, oversupply I Coast.

from of material Commission Commerce determined industry there the As U.S Department reasonable proceed Xth, of to as on note, the Belgium, and likely injury volume. investigation. Trade you’ve the imports for Saudi to indication Spain. acetone represented than voted investigation on is Africa seen less Singapore, but result Commission a South was U.S. April total Korea, of Arabia to that International X% The of I’d from imported dropped, The

the months. process XX completed We over investigation expect to the next XX to be

to Mike discuss the now and the to me outlook. over back Let turn flow call cash

Michael Preston

where and Okay. capital framework. Thanks, we Erin. slide flow highlight now deployment on nine I’m our cash

high-return quarter on And and see, basis. and robust As the to will repurchases. improved capital shown, as XX-month XX-month product be performance continue as for driving basis from and efficient helping value trend left operating through is shows side cash and share cash an our has of Aligned in fund focus investments a the long-term page increased a We’ve has debt everyone trailing higher chart to us. on maintained strategic with paydown working flow significant cash business, operations the you’ll flow XX% a aware, XXXX. performance. earnings, previously improving we’re And the area trailing priorities minx been the we’ve hand first of our on flow CapEx of

are with we’ve delivering We allocation drive capabilities as on and committed high capital inorganic previously the return excess consistent the to cash priorities pipeline long-term returning business, we executing reinvestment, building shareholders. out value in growth discussed, our to

for capital We continue of to beyond further see integrated ample deployment our our enhancing chain. incremental opportunities base CapEx, value

While these company. the projects fruition, the of not further value drive pipeline come all disciplined will for will to execution of

initiated two capital Now, projects. year. we’ve the talked investments We’ve triggered about also larger more other extensively high smaller, last return

particularly our emerging in also as of to such granular which increase replenish buffer Most output current continued our meet pipeline our we've net investments example, cost that production in value phenol regulatory Europe. expand conversion, as and evaluating ability agent higher intermediate sulfate our growth we’re used anti-skinning will high EZ-Blox increase requirements, return to ammonia and yield, well projects. cyclohexanone, our notably, capabilities sales. for We’ve to to paints improving For to cumene invested our to ways grow improve as improve production for approach savings inventory

continue all and product technology broaden with continued have improving the we’ve in our profile could $XX across our margin base And while of April and addition, lines now improving flow to our through In we’ll $XX where landscape remaining approximately of each customer enhance offering cash XXth. of we buyback free authorization. lastly, our stability. and million our shares We evaluate under portfolio, share million opportunities XXXX repurchased product

slide XX. Now, turn to let's

recap to our Q&A, outlook we’d to turning like Before XXXX. for

remains quarter. from across you be and with commercial last puts to continues there the shared we outlook full-year what intact From perspective, a Our takes portfolio. generally

continued nylon environment. plant through demand utilization rates uncertain strong a driving macro on We’re focused navigating while

in as conditions quarter. oversupply continued for the mix seasonally of Operationally, we change sulfate, second $XX monitoring mentioned will to earlier, nitrogen a of million we’re and through income to further planting fourth year. season. turnaround prices for to in quarter increase the $XX the bulk impact, from of spring XXXX, ammonium remains scheduled pretax range globally which the this really no of occur which And the expect our expectation lengthening acetone with plan the Erin million For in fertilizer

was for our report and second spend CapEx our quarter In no to pleased to addition, time we’re change term on on and prior around expectations year. that budget, the completed

once boilers to We gas-fired our continue quarter, natural on to productivity third the Hopewell. line begin new benefits expect in in come

earlier, in the with million additional And Erin from our perspective, quarter majeure. also impact to second $X phenol the and consistent million of that's As brings we XXXX estimate. anticipate first $XX unfavorable that impact pretax an approximately disclosed income mentioned from a the previously force half total

we linearity initial operational in the as the underlying second and half. our impacts Lastly, think plant throughout quarterly anticipate performance. continued than That investments the first capital return we earnings be benefits to the the about excluding our turnaround or includes improvements high XXXX, stronger in half from the of year results of underlying

will As discussed, control our trends core focus on and growth investments advantage nylon our on acetone maturing a close capitalize in value. demand drive that in we're second Erin best shareholder to into and to near-term what's while maintaining smart quarter, our on including possible capabilities long-term outcomes, the and keeping eye making drive opportunities a the

that, with let's Now, to move Adam, Q&A.

Adam Kressel

Mike. the Thanks, line you Riley, And questions. please if for Great. can open


time, Please Vincent ahead. Stifel. question Anderson this [Operator from first will at from take go we our instructions] And

Vincent Anderson

Yes. Good morning. Thanks.

partnership. So, to the on start I wanted Oben

of agreement, change any then, economic economics? resin developed the whether or economics new for cost on product? plus the about jointly would it’s And those structure talk briefly Just how shared the

Erin Kane

has confidential, honing the Vincent. that appreciate were lot the I with structure question, Obviously, set a of So, up. been associated as how

films and U.S. we the be combination well, I at to will into produced Chesterfield industry. will and brand the the feel is synergistic the back we think, use of meet I our well-structured be long-term that reiterate using sold as our the produce efficient at films of Aegis resins to as of and Oben, names needs customers capital under that our Again, Capran sort would they

state-of-the-art and we’ll transition new And our come set well right the the new longer there. both on then We’re with focused ultimately our customer look you the term, growth value employee could chain. as approach heavily, transitions focused capabilities with of the then R&D product new on can to into like. as imagine More facility, now, side new as capabilities their what

Vincent Anderson

follow-up I of compounds automotive X new you're Is Great. Oben that on development? about applications. in produces Nylon And further saw talking that that. Thanks. to terms quick just a for something them for product also areas

Erin Kane

to-date the of areas are films. The alliance around packaging and collaboration

So, the in the value films BOPA, through as on soon discuss for sales BOPP them representing and we're BOPET as ability will to chain we our as have U.S. them the transition with

films, with So, there. again, and we’ll from go starting

Vincent Anderson

one XQ the And you ANOSL have weather impact making fertilizers how could more quick. to and estimate if ask I volumes? up in the real of XQ the ‘XX second on for just [ph] is terms from quarter an Do -- started in those

Michael Preston


compare we you have will about, related from weather, the you one Vincent, specific is a logistics estimate Erin to we to as flooding, start quarter some season, some overall. So, [Ph] on what have the say, did as perspective, that I first don’t issues compare year-over-year we slow a Obviously, wet see overall. thing ANSOL. a talked the

domestic sulfate improved to a has start quarter, conditions in see is season, that QX. and pick of season We planting which been ammonium into has improve slow first volume our did and impacted some quarter. assuming the in the with but we in we up the anticipate second as here the that weather So, get late, do consistent


Chris our CJS instructions] from will take with ahead. [Operator Securities. we go Please Moore And next question

Chris Moore

nylon Yes. just markets. start on end can Maybe

QX You in of that cautious after called again. some and there, terms out the end of were markets

caution concern a the versus that QX of with in at end Just QX or months were heightened few talking line of ago? would kind directionally, or about we was the say you what

Erin Kane

Chris. Sure,

me a elaborate bit more. little Let

engineering And signpost quarter, weaker certainly see in also destocking would sales plastics weaker and we in to point are correct. the consumer in as through carpet the be product U.S or few fibers, demand over a group. the chain. I towards sales we discuss that vehicle were continue with are quarter, value You did the Last closely kind and say car only of global auto continues to indicators sort China for light monitoring to reported to the months, watch shrinking first last potential the Right? key the

Europe contributor regulations and in on EU on Brexit have effect. is continue from the like Another to Commission COX ripple

rates foreign back for while cold regions rates growth we I further year have was of for it wet the the U.S. kind already and across we with quarter certainly from to plastic certain housing across saw the chain, again, building seasonal appear starts further we muted quarter construction spending last down sales our in potential have we were board as a on talks spending the country. that resin down so, carpet, that weaker And construction value started and around engineering certainly place moderating of weather We And impacting softening put last of have growth quarter approximately down. are the as we well and revised in spring. X% customers in certainly as well. non-resi seen demand. uptick expected revised the mean the would the And and year-over-year And on entering then talked further talked sectors.

to the I disclose we’ll in will reiterate what are quarter, environment, stable and you applications. the kind I and place as through available appear mentioned of nimble finally and advantage. on ultimately underway. it’s possible best -- we the continue And and to outcomes, earlier, robust this indicated continuing the certainly in focus, was perform, always given driving and the right as inventories rebalancing and to I operations the softer of while that signposts But, think agile change cost our be Mike regions a will global we’ll remaining for safe So, does products best on

Chris Moore

It still XXXX looks to helpful. if XXXX. And half really XXXX going in going of you any things QX. of again there to it's half like on could today, that. of where the half Acetone, to you say second started to compare strong to be as Got seems weaken obviously, sit early be very versus or whether it, supplies second second to like favorability sense there were too

Erin Kane

Honestly, say XQ. right? through on Chris, bit early, wouldn’t We're I it’s navigating too focused a

that As be below XQ expected at indicated to over half second XXXX. we or is of

Gulf Just more balance year-to-date the coming in in saw net-net the XXXX XX% were significant greater same than market. imports year. were month little bit imports is to in about context, put of April. more it We required to than what they April still actually imports in are what last fact been the market And into or of the the plant as now that disruption turnaround, in of demand XX% carrying and unplanned March coupled and sort with the QX, forward a it mentioned offline has whether beginning with was the in disrupted, with turnaround I fire. then associated

see signs committed to that we're we lot different. of communicating a So, certainly anything making are to navigate through when we sure here, and

Michael Preston

to the really we year. last the saw on of really fourth accelerate spreads compressions Chris, quarter the starting in

perspective So, last had even year. third quarter in you from a year-over-year, the reasonable third still acetone quarter spreads

bit year. difficult think I little Erin this really, of this a quarter to point. the So, it’s fourth as mentioned, to bit little a year-over-year easier at comps the But, predict I get again

will very We it closely. continue to monitor


Please will next our [Operator instructions] take with question And Charles from go we Neivert Cowen. ahead.

Charles Neivert

a Just I deal But logistics have fertilizer anything those areas into the are disruption, got to with issue you issues another still you ones. slow been to. go that’s guys did seas, if One, them? -- obviously you couple or are it’s still guys on or the any into delivery of quick else resolved having or deliver to dealing typically Corn you Belt, mean, -- disruptions the rail you for in? with

Erin Kane


pretty in -- of that -- warehouse in with certainly shipments and we're site current. good truck good at is believe shape. most rail Rail inventory we point we’re at leaving and us, has been For shape the are ours pretty this

the River logistics broader are the I sort and of for Mississippi locks considerations, I north areas movement. down of further think there shut think still dams have that

nitrogen for overall regions considerations But inter-Corn we're be in there shape Belt, perspective. get good just could positioned. some could certain So, currently we're an from that how on we believe tight

Charles Neivert

expect issues? it from region river barge, on not you up if they likely? any mean, can’t does very that in potentially other Do for some [ph] or the opportunity I sulfate present get benefit big is

Erin Kane

UAN move seen like think, mix, you right? up are overall think, been trading, nitrogen may now moving for are while see urea ammonia just -- nitrogen considering I sources rather pricing dynamic has right you have and and urea may down. prices in other I a it’s pretty up, flat fertilizer as -- to

be depending it’s the think considering, creates at uptick? where and I what states I large the application I point on are. current to mix it sort assume of is a wouldn’t think, a going that So, this But, supply

Charles Neivert

by is pricing The other out some that or situation. where to materials, you some been things you is close going or or forward through in pricing see Is that the talking substitution continuing taking market people any better Nylon help seeing combination want something demand with the or issues where that by raw some supply a been thing going been lifting having something high forward, been we've of gap has could the been there improvement share relative with some from two? has to been guys because XX they seen either have bit it X, affected little X XX has has

Erin Kane

ultimately Yes. I yes. you, reiterate for would

of from So, we're that opportunities certainly I demand broader the working for from substitution market to see a compounders are perspective. opportunities standpoint there think X aware on from XX, applications and of the

significant in plastics, given focused integration large on independent compounders, the the primarily chain For we're other with players. us engineering

that I seen off pricing of end have indications also We of is heard that improving and on think demand supply market. we've XX softening really come

I’ll transition to So, is time an lengthy and And continue and particularly in watch. also area these in say auto OEM, and it’s well. substitution the as qualification to spaces, rather think I

again, between So, that I And say the spike for I we’ve term, has anything one one of watching Nylon materials. the globally it’s plenty longer but a been I well, positioning still but has don’t say X creating a that large been consideration capacity. or way know rather would it’s will other two

command. can versus the tightness XX think So, I driven spreads are more X in by the what


we’ll question Anderson from And our next go ahead. take Stifel. with instructions] Vincent [Operator Please

Vincent Anderson

any been couple I recently you Nylon Yes. was not by have wondering the in U.S., here. competitors I if price whether that’s accepted of one knew whether the a -- Thanks the and for into if increase major you wondering your markets? or X insight proposed was entertaining more

Erin Kane

has North rationale. are market certainly, soft, So, Europe, just the out will Europe increase into And close share opening QX, May. then up of aware put can significantly the announcing other the with on largest months see of from the moved to six seeing have we situation late is coastal sentiment predominantly as player you [ph] for a not gone in April while share, where region another What won’t speculate I that and significantly been we we cost. have and well has effectively American, certainly price being there nearly demand market in

right would and a back QX benzene monitoring getting I pricing in just movement QX consideration the into I of coming where in be think it basically has dropping but here. we're would say held the

Vincent Anderson

perfect times opportunistically hedging thought your you segue, any like And given benzene, become spread have the these Great. exceptionally to propylene exposure? propylene where can wide, the the in

Michael Preston

that, benzene formula our about And obviously pass XX% talked formula Propylene typically majority hedge. is suppliers, to wouldn’t cumene. cumene as that our to look these we our that based with of then our with contracts also changes fluctuate one at good buy of we we we will revenues of propylene. look contracts, cost And and on a when through. also we based Remember,

therefore, we -- mean, to perspective we reason have there place, So, isn’t big -- natural hedging. a and contractual have really pursue in I no hedges from


this back to Kane closing with conference for would the remarks. any like over no questions, concludes now Erin I turn further to question-and-answer session. our And

Erin Kane

morning. you all time for your interest again and this good. Very Thank

results Our quarter again this a and to demonstrated highlighted our environment navigate the organization. our resiliency of ability dynamic

focus XXXX and beyond. have and maintain next our higher Thanks to and stakeholders commercial we capital continue excellence I’m what We speaking value product in of and day. With quarter. smart disciplined great we’ll strategies, you with forward that all deployment. accomplish for again a for our functional excited look operational, mix to key on can


now concluded. today's is conference presentation. you The Thank attending for