AdvanSix (ASIX)

Adam Kressel Director of Investor Relations
Erin Kane President & Chief Executive Officer
Michael Preston Senior Vice President & Chief Financial Officer
Stefanos Crist CJS Securities
David Silver C.L. King
Vincent Anderson Stifel
Call transcript
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Good morning and welcome to the to the AdvanSix Third Quarter 2020 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Adam Kressel, Director of Investor Relations. ahead. go Please

Adam Kressel

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

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

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

AdvanSix and CEO president over Aaron is that, with to the turn So call I'll Kane.

Erin Kane

joining your safe. are good us coworkers as Thanks, interest for and families well Thank listening AdvanSix. for healthy staying and that their Adam, and remaining everyone I as today morning, you everyone. in continued hope and

our focus second scheduled customers safety. health which plant caprolactam through and the executing to as diverse we business environment. vigilant delivering a As on remain the our release, quarter. focused well originally product as for continuity In while the you third successfully competitive planned saw low our press navigate cost serve our current for with quarter, on We we portfolio continue turnaround, completed plans advantage on our and was

and we support pleased We contractors Mike those delivering, continue very financials model. believe to of as pace we we've sales to quarter also resilience volume seen while be moment, that the sign third practices the of to the our and regional with results managing our which encouraging came site in where strength onto results turnaround global our our is reflect activities. of that protocols detail will are recovery. our the Notably, a returning hundreds and pre-COVID levels, business an monitor nylon

flow capital capital the In and improvement, reduction working management generated in addition, quarter cash through higher cost of we expenditures.

We continue cost to associated And this to for gas million natural with disciplined take of million is to to savings and approach management the year compared $XX to $XX full investments. our addition boiler a the benefits XXXX. cost an expect

industry a ahead the acetone XXXX-XXXX through we ongoing favorable continue also from expect balance while planting a at sulfate, while look perspective, end line differentiated benefiting chemical season. our nylon position for in are for expect and optimizing growth ammonium caprolactam to supply environment intermediates, the product uses, And we the portfolio. targeting Hopewell this we across and As product geographies we strong applications demand In from within stable to plant success. business investments utilization mix

on capacity additional million the between financial quarter cash third hand also of the and under in We a credit revolving At end liquidity in had remain our available confident the $XXX we facility. position. approximately

CARES of associated very positive run by a to that a resulting I'm the all fourth robust capital the cash and as ahead. lower quarter mark On Act, flow anticipated about leverage cash I'm improvements opportunities capital hit generation in receipt full supported with We continue flow and off, of working reduction expenditures, excited the made benefits a more spin of rate further cash October in and we four-year while this the our organization expect the levels even lie of for public proud our since tax accomplishments has year. free company

for to As morning, continuing share conservatively some aspects approach prudent work take this complete XXXX we our of we'll of perspective. planning macro to are which planning a from a we

that, Our strong profitability, growth it product and I'll priorities portfolio and the to Mike through to over capital. excellence will discuss cycle optimization, disciplined details and through our of focus stewards on improving being quarter. mix differentiated continued operational and enhancing of resiliency With the turn

Michael Preston

in unfavorable the two Okay, And great. well was challenging financial in raw versus X%, review ammonium environment Slide we volume lower our and where driven which [indiscernible] particularly by reached a on prior a reflecting sulfate Thanks, prior investments versus product highlighted unfavorable by X% Erin, maintenance industry cost million well million key in in cash the I'll material disciplined in plant sulfate. variances versus $XX last the about the conditions walk changes volume Sales market about prices was impact planned per overall quarter last our and was next by sales nylon. chemical again primarily flow X quarter. and the in dynamics loss from year-over-year, share the year. XX%. caprolactam lines, year I'll and intermediates, following management in of roughly by good by as in on the income. return and savings pricing, and slide. sales about year the $X And million about million increases end-of-season strong now lower Earnings the once as to domestic the $XX favorable net high several by our dynamic of operations down year-over-year lastly, spend. year, to offset the very in due due EBITDA This the results. quarter. offset over Market-based CapEx nylon I'm ammonium about through That's capital, overall, of $XXX was quarter million quarter reflecting improved pricing granular the acetone. of in partially everyone. third sets $X.XX increased compared X% morning, decreased to was the up about prior XX%, growth compared turnarounds. favorable working totaled impact and of generation. that's million million executed in to primarily $X $XX down cash $XX to down partially Sales completion lower growth Pricing quarter, and repair year by primarily was

Slide Now let's turn to X.

the million driven perspective. a roughly Pricing drivers conditions volume a sulfate our $X of versus roughly was we've would a it few thought again reflecting be improvements an once performance in EBITDA revenue products. quarters, and in and an This mix tailwind quarter, from overall lower reflecting of gas other input This in a our million basis year-over-year large exports. ammonium reflected inputs, last unfavorable natural in caprolactam the pricing net items shared approximately As and lower offset our $X relative even input cost, to few Tracking million highlight year, intermediate key Despite $X sales namely sulfur in across margin by gas increase we raws decline. to other key year-over-year. an last and benzene nylon market-based helpful EBITDA million variable by spreads the higher costs. in sulfur industry key of pressure on benefit drivers, in headwind challenging natural increase partially over nylon over primarily saw was and driving represented in volume caprolactam a from $X business continued prices, we an higher offset propylene, price by and year-over-year sulfur, acetone net and partially

As products, to most not given to to such COVID, space as auto, primarily nylon a textiles, impact packaging a the where and consumer-oriented we've seen ends surprising is material up carpet. in reminder, which the from is

as we're quarter savings the to $X successfully consideration, where third there XXXX, of of lower well. $XX demand that our expense in in to ammonia million $XX cost and as While exists. was mix our third XXXX pretax The plant as product versus impact place quarter unfavorable Hopewell quarter discussed temporal and of is compared an as headwind which XXXX, demand including reached this approximately income completed the actions, larger a turnaround year-over-year, Kellogg pleased quarter we million plant. SG&A expected, Productivity last planned turnarounds $XX we we plant volume the is of including cost quarter, million third million representing returning,

compared half assessing management and the nature, in year permanent. temporary our moving dynamic focus more In being full are keeping to indicated. while of cost more with XXXX structural of markets. remainder are $XX the our and addition year associated Erin we boiler for a to benefits higher natural investment, return as to targeting roughly million full the reductions estimate on disciplined We cost savings cost gas $XX We're forward million with

to approximately realign continuity $X productivity Lastly, supplier cumene efficiencies in quarter chain logistics the we supply million impact an favorable following Solutions. continue while Philadelphia of drive the cumene shutdown supply of our Energy ensuring and represented as

turn the global Slide a continued results, altogether third across benzene lines with caprolactam on here basis let on Consistent year-over-year our the product Now quarter. over our in to pricing and slide. We've next me included typical to our spreads X. spreads decline

a on seen quarter However, break of the XXXX. have sequential we from basis stabilization second

per benzene in ton we're chain, capro through we industry oversupplied demand. encouraged continues trough spreads by and about approximate spread we and remains to value an levels has levels in are the in the inventory just Asia improvement in third above This the now stabilized recent average months globally nine XXXX. Although to for saw $XXX position monitoring the the quarter. The

energy typical reflecting $XXX a industry per to spreads we caprolactam XX% global heart decline declined quarter, exited whereas the through It's over continued prices the contains resin impact as urea seasonality basis pricing season. the the as of the in also contains year-over-year roughly Overall, middle Asia the quarter quarter. planting to sulfate the in domestic XX% important on ton nitrogen. $XXX lower pricing third to of normalize the second of Lastly, ammonium range average nitrogen the and nitrogen, from

supply quarter. declined And other North the to relies last expanded and an further demand a third demand. nutrient. have the while in monitor pricing demand segments as With on European rates So own over propylene supply global improve On duties, additions, came further biomarker sulfur small/medium affirmative propylene a nitrogen downstream at its competitive the sequential light a underlying drop buyer anti-dumping home which dynamics over premium in improved as continued premium and for influencing robust earned both of and utilization online sulfate America in the from asked the acetone tracking phenol expansion we significant on supply of the lastly, urea has quarter prices U.S. the while the quarter, as ammonium does year, and continue industry second imports. industry pricing products, end levels that, costs influence final last in balance from in refinery-grade year. well in We've the costs seen the increased basis following the large after third through propylene year-over-year trough basis, of dynamics

one-third pricing is As where a reflective is the predominantly reminder, freely the buyer industry of of small/medium price domestic roughly negotiated.

Now to Slide let's turn X.

side drivers On the the of cash the in we've the third highlighted quarter. generation of the page, flow left robust-free

quarter, As the $XX generation inventory in favorable anticipated, impact. a $XX capital working cash with flow overall to was representing a million the of million cash source contributing

goods Specifically, our the resin organization nylon and to finished of drive reduction in line. particularly with well inventory, product executed a

our perspective, also we've discretionary noteworthy savings contributions. and spending. this year's and all including across continued cost cost around our disciplined resulting tighten macro from capital challenges We Recognizing the to business, in productivity management, a belts remain

our our savings As CapEx cost in significantly maintenance spend. quite down run repair investments several as completion following we come return high CapEx we has of manage rate closely growth previewed, the

discuss expect the of cash continue further which We generation supported to levels, fourth positive in quarter, moment. in XXXX, cash leverage a I'll in a in by resulting flow free robust reduction

in as a sulfate expect as capital quarter Act, exit CARES perspective, third. quarter fourth flow we benefits previously. the as million the advances. CapEx anticipate of to for the saw pre-buy $XX support we generation performance cash refund cash And continue as inventory, of tax to $XX million on an the From anticipated of for rate cash the working continued fourth anticipate ammonium a result run year with approximately we overall we similar or discussed we've We roughly reduction year, do in the full the lastly, and the

from a into strong improving and perspective as outlook a we quarter overall, an cash head So generation XXXX.

our X to Slide as a address position leverage We let's turn leverage. regarding to to have Now levels. in and potential confidence our spend the to debt clarify moment our perceptions discuss we as wanted investor financial well

our showed of adjusted accordance revolving of the debt the end back are the calculated XXXX. ratios, side in trailing the going net we EBITDA Both On over months left leverage credit of terms XX our and our page, adjusted to with net facility. debt EBITDA,

EBITDA compensation the adjusted stock-based other cash charges up revolving in the back as credit from items million non-cash XXXX. For items. nonrecurring of recorded includes example, restructuring to debt possible Net $XX credit of minor balances our adds and less facility other our and such line

include leases does by sources of amounts operating the definition. not Yet standard, external new leasing it these various unfunded creates liabilities following However, pension include of impression and debt the which increased leverage. reporting

being as of larger despite levels perceived leverage be and to than buyer percentage a partner. a has tends lending Our impacted debt operating leases not peers the considered debt

boilers the gas the business, at two and quarter, turnarounds have our In a increase plant caprolactam leverage consideration do large our tied timing our did we've XX-month impact period. R&D quality of we project investments to debottlenecking the lab third notice and over Hopewell, conversion within up last ramped the natural as namely trailing to planned a in year You'll relocation. strategic

recall of XXXX. and completed just million a $XX turnaround $XX the plant had quarter You planned in turnaround the plant of roughly in quarter third fourth XXXX million we

and We be I to well cash Xx within anticipated months EBITDA, debt months maximum the by our EBITDA. expect trailing covenants of to robust normalization the generation X.Xx pay adjusted turnaround as are as leverage of debt supported continued XX target XX the down. into earlier, trailing plant our and toward planned yearend well that's discussed net And range our impact reduced

Now, let call back turn the Erin. to me

Erin Kane

and Slide the have market. through largest considerations. The the end and primarily now on industry to here strand market Thanks, chart X construction, pie Starting exposure oriented into our end represents Mike. carpet discuss sales on by I'm some performance we shown building nylon slide key with board. phenol sales

have and supported by record-low this period to trends improved and rates sales home with areas. starts through Our low-density residential interest existing housing migration the and suburbs to grow, continuing a

represent of While residential residential has does we carpet in the been of commercial improved more demand a from construction have demand. been have the smaller sector trends carpet nylon stronger pandemic lagging a nylon portion and wake unfavorable seen this have Conversely, foothold. applications, overall where

hospitality We until trends remain expect in term, more soft the office commercial post-COVID. construction to there's near into visibility and

to business. demand market a as Again, another steady sulfate seem fertilizer for yields. favorable demand We significant granular supporting around pie the clockwise. Moving chart overall is sulfur ammonium end key crops for remains our continue to expect as nutrient for

demand as we would heart As that strengthen into domestic seasonally, move we move the into year. season next particularly we expect planting XXXX, the to of

for bit remain monitor continue roughly growers next for moved acres We perspective. historical corn estimates million and expected levels around crop profitable with more to which a low prices up year, from planted acres flat to industry do these have $XX though for relatively

go have well been favorable. also continue to The through education. work trials promotion recent and Our and research, soybean in marketing grower continues field investment application testimonials

So an to be area growth. longer-term that potential of continues

demand, demand seen precursor to which We've at healthy continue, screens retail equipment acetone has recovering. is acrylic expect uses other remain and a plastics. into locations in that also protective to offices Moving been although

has we U.S. Now for of levels. remainder back where favorable recovery nylon and in further perspective, continue. where From and to The faster industry monitoring with the electronics production lagged. solvents we and China value compared the steady while returning engineer we balance supply months are industrial chain, a recent plastics pre-COVID and we've the demand to expect consumer and and in remains seen Europe, acetone demand to sales Asia are growing trends,

using value various Nadon high growth momentum which is cyclohexanone see solvent for also applications. We a product line our

we demand out for home on rounding and packaging chart, do-it-yourself pie pandemic. to see robust coatings nylon the paints food has into our demand and remained the continue intermediates Now improvement strong for rise during the [indiscernible] projects with particularly

our not core So let's we XX before to XXXX. up as turn Slide into reiterate to I move like Q&A. to wrap to focus head areas we

excellence cash cycle cost creates and We're earnings are operational through on company. productivity, core the improving through focused profitability. improved flow as strong is and continued and of leverage. asset operational who optimization This a which driving First we at

as in programs. in yield our improvements have turnaround as place plant We in rate, well efforts targeting further and quality planned efficiencies cost,

on come plant provider leading impact a American in waterways, into be commitment industry. million where million today. million in campaign We $XX excellence of entered further to eliminate With the resin even into our nylon the to in initiatives XXXX range planned expect evolving sustainability approximately waste our plastic Operation to North $XX recently and $XX $XX comes in is as million turnarounds we've pledging Clean and We of versus XXXX. focus whose plastics in maturity XXXX our Sweep, to programs the program operational

resiliency. second is Our enhancing priority portfolio

example offerings Now, well. uses our XXXX sulfate value driving and great portfolio serves of proposition across how the our been end product. it's Whether has us through ammonium nutrition diverse intermediates sulfur a chemical applications or various

focus ongoing diversification from capital Differentiated key Our well. this as cost and management priority this supports high investments. has portfolio year's growth our complemented benefits return product

of a talked about of high purity products are in nylon. growing base, different differentiated area still we've these focus small Now across but value three buckets: intermediate, Individually, successes this seen we've product in improve contributions We'll our high the cyclohexanone and wiring off applications, and the portfolio, on to oximes, offerings. environment be capitalize expect continue macro from to term. cable long further over the including well-positioned and lines improvement these many and

stewardship. capital strong Finally,

to $XX spend towards modest and return in high and savings We million cost which XXXX, of does expect continued growth projects. CapEx $XX a be amount to million include will

approach long value. our shareholder to in on focused and remain we drive return capital on are improving term as our disciplined will We invested look

shareholders. million X.Xx our options target share Xx have with to leverage acquisitions we'll to and be our portfolio out to continue remaining product and $XX repurchase would have also coherence to pipeline capabilities return to approximately and build range potential internal under within We've technologies. strong as continued authorizations our cash assess of inorganic to our and that We we expect reduced evaluate lines

we time, dynamic With Q&A. deliver move for shareholder this Danielle, have sustainable term questions. growth please During if Erin. to place in for open long Adam, to thanks, let's that, believe you elements line strengthening ability return. our are the and Great, foundational we the


ahead. CJS begin now will question Instructions] comes Moore session. We of Chris go [Operator the first question-and-answer The Please Securities. from

Stefanos Crist

Good morning. taking This is Stefanos my questions. for calling Chris, you for thank in

Erin Kane

you, hear Stefanos, morning. to good Great Sure.

Stefanos Crist

morning. Good

little product you and us high on a applications? and update also more color could provide First, and value purity the intermediate differentiated the growth high

Erin Kane

Yes, pleased progress this to, an going proof be us. this interest I'll here as points we've continued of recognize and to last couple and to some and for area perhaps over the area how years offer strategic of we're continued

So and quick view this And extra well. as that we pointed purity drive continue X.X% as do have those lines to in portfolio intermediate, high places high buckets growth its as applications you just products reminder, to and all high-value are to nylons differentiated these applications, value to X% out, margins. - effort a

were at So this projected XXXX, we increased AdvanSix for year, total sales X% has this of our in bucket. we about XX% where look to That into fell XXXX.

the would premium the about value we in and again, X% that doesn't view as of growth high CAGR overall ammonium that sales - note represents that sulfate, a bucket. our XX% about earned our which as this product include well. granular So though, total AdvanSix I for lines for

tangible XX% some we're around cyclohexanone. where three-year grown Since seeing we line of that meto my XXXX, growth has dive and a noted kind in So CAGR. on I real product into and comments

we've applications. growth line, CAGR in product and our off On more a cable remember, offerings actually are as XX% niche That's qualified. and year, doubled again, drop-in the line. of introduced and quite That for CAGR. our a year. which three-year year XX% on [indiscernible]. base, going a Kind this up - nylon, that Again, product replacement They well, bit has this XX% EZ-Blox these seen our they're copolymer growing of product. talked of small a be a lines on sales three-year growing about that also introduction nearly oftentimes have this XX% we oximes Our than and into specific to and wire has

So with term. year noted we've I we here again, our serve have think a and us seeing qualifications and efforts will push emphasis delayed longer continued think even customer where just been again a perhaps that area still that positive slowed, in of a

Stefanos Crist

Got much. could very I one queue. just in it? And Thank and come you the more back

XXXX $XX So some you COVID? million about Is talked into of million that for just Or that year $XX full XXXX? cost does flow to of reductions. all of savings one-time the

Michael Preston

call increased. has on Yes, by - way so as indicated that the we the range

XX So of we $XX of that initially we're quarterly roughly last But we in when of temporal $XX million, discussed that more said to we on range to XX the million. and call, expect is this is half be the that million estimating million that earnings structural. half now to

look SG&A so as at the about think so quarter half our year-to-date, is you being relatively had to if spend we're want that cost, our the you the back pretty comp you incentive next as if for quarter, In that fourth lower So costs cost was of at say I'll coming fourth range. IT What We within low. year. look example be close will well. low to XXXX, in cost,

to significant a so as XXXX And get be challenging environment. expect forward a head as year-over-year fourth sense in things our very this cost to you going how as - look reduction quarter the perspective of structure into from don't to we in fourth a here. diligent we're continue going So can we're cost optimize we seeing and much year-over-year quarter on just really upcoming we this

Stefanos Crist

it. Thanks. Got


The Silver King. comes next David question you. of C.L. Thank from

David Silver

morning. Yes, hi. Good

Erin Kane

Good morning.

Michael Preston

Good morning

David Silver

of questions. couple a Hey, I had

would first revenue So be the side. the on

by line just was of seems incremental I your it relate to pick estimates. then sequential total quarter substantial there towards you million chemical revenue take like product on the allocate the lines my of revenues $XX very different your your up it this revenues, percentages to intermediate when a that your an and So

the in how intermediates I'm is on of coming that would guess I going but chemical pickup third revenues give the some were of quarter? acetone characterize some sense substantial what wondering So during you us just Thank on from? you. Maybe line just was where that

Michael Preston

Well of fact a when in soft the and that COVID consider all, to quarter overall. need utilization third second quarter, the of first to demand as second the result economic Yes. quarter very you impact the compare the you're was of

So only with when to in And sequentially. getting buyer, shared improves the medium also second you up. relative and look line pricing, quarter, to which all at the particularly has third improved the pricing But also of was generally volume at when we point the from moved stronger saw third specifically, out the the in revenue the across second, We trends you but at small as you improvements you board. the phenol, and AMS the the we virtually second revenue. business, top a saw strong Nadon were really the intermediates products when volume look look really everyone the in third and to well growth intermediate and quarter not from acetone

it's driven volume the off So by both acetone. by particularly of second well COVID, as in really because quarter lower quarter of a driven coming pricing as

David Silver

color. I guess question Okay, Thanks very - Appreciate sorry. had it. I the for a good. about that

on generate working the about I question And element. both XXXX. this your had capital and free to comments last flow about year for So I a just full expecting harp one guess I cash to wanted quarter maybe to

know, a million don't capital the working I to in $XX around, quarter, there net benefit of the per slides So $XX third was million.

not but Could way the maybe what quarter? quarter expecting a certainly might you $XX So laid looking you're in payable but has be think inventory it so the not, I working down I pickup not comment in guess There benefit, incremental accounts well. earnings, And be the much receivables and you that or run third more maybe may benefit on as I in your much to effectively in fourth for released? out. how be was capital the maybe capital a working million third quarter. was

Michael Preston

million But what We in is in are you goods inventory, a And $XX on million you when inventory. two-thirds $XX see did benefit there [ph]. at indicating few business. sometimes the that we you you'll reduction down saw $XX capital a and really and nylon working of the when And they're a quarter. Yes. break whip variability of quarter-by-quarter get third correct working from things, is But some million the in that overall. basis which was a was capital, the about look finished

we talked the inventory up to year come timing to by raws, that have considerations they So is half first and about as was the the fact cumene. as down quarter of there in which elevated $XX we some the offset partially levels were during were expected million the purchased and

quarter, is weather we still We focus higher go big very inventory the is as mitigate on potential to into balance also anticipate and to say I'll inventory down. this reduction to hurricanes associated in fourth tend to a continue hold year impacts with potentially down the we What go Gulf.

cash would anticipate contribution We so I quarter But other We going continue of the That mid to quarter. seasonal also focus capital the perspective, is fourth in cash quarter. in to flow drive on may the a also the typical as we're to ammonium sulfate call from working probably it a wouldn't fourth in movement low but the out some I millions advances have it and some to close the free be to in contribution fourth year. large help. in anticipate areas, pre-buy to going

David Silver

that digit low millions? were your right Is referencing the end what towards to you just to comment? So mid-single clarify,

Michael Preston

Yes, that's correct.

David Silver

more was demand global to that outlook. might little a color hoping comment I'm be just going But nylon in of to spiel Erin bit Okay, kind more. one more here, one able on just on fit the I

as your by normally maybe you are just I'm is little uptake other pounds leading differently have time there Or end Maybe to expected? have end weaker, you the different on hadn't the marketing typical than regionally as might? guess In be you I where something when maybe on outlook earlier traditionally maybe, finally that's and things saw the up. little certain picking the third progressing this quarter, you. auto might just about commentary year would markets Thank regions, bit placing anticipated, you or either then perspective, industrial a stronger a production counted your where Maybe words, their started? your than some you market are your from anticipated? nylon into is of activity in see big differently, global may nylon picture the or nylon that you levels on wondering demand? So new rebound we progressing some maybe maybe bit in

Erin Kane


course, Of David.

is it's been the certainly, think most given point, conditions on it space we've front which Weren't this from really operating. pandemic. necessarily great year. the communicating long, I with, well-noted, nylon and we're all in no, begin of seen that to impact long ends the COVID the where we have a and you at market And this

being we car And even we about note Asia when volume demand there, clip been to are at only which further lagging they bit of XX%. in to expected, is is starting chatted pandemic seen is built in time China, that at that believe U.S. to which As pick year-to-date XX% last first up when the months, like than a Europe I last down has a certainly what sales regionally X% see auto a again, down of momentum standpoint noted, returning levels, the think you certainly, control. The still is and though the pre-COVID more lagged. look lot with sort in but I we it's instance, returning from in here you're XX% faster we've for being several had

global sort pandemic seeing of progresses. So as very recovery regional we the this differently are

So the higher been is us on turnaround and what sort it driving do turnaround where are of or heading to rates. the hand allowing I one is certainly as kind meeting we've lagging. think that's of why one demand exists. the say, has exports been higher necessitating consideration our into utilization we is That It's post as our U.S.

through, down even levels in coming carpet of to engineering spaces come of the to quarter a continue we headed kind the we've auto and America. on of is commercials tails pool into pick sort as in seeing in residential fourth, up and we're Now, plastics, the the right that non-auto that. is pre-COVID North third the returning see again, Certainly in through though

we Europe seems signs, in clearly, demand see say, there where But signs see watching we're our regional have really remain forward, recovery really to that I carefully. Europe to the been which turn?' levels. that ensure recovery will going I noted for we do think agility is continue meeting in looked to we're just joins market is it to exists. stabilized Asia. your have here, couple to perking a it's trough little But you see It's we hard here very Asia, U.S. impact in at we what a textile that I watch were resurgence we recovery driving as the really both at even it continue you to And in full view need least operating to and the weeks as that to push this bit as certainly macro note, are be ongoing, up the a plastics moving up uncertain. be global to flexibility the think robust. packaging and still So And engineering will the could If which think have focus 'Okay, asset on we've ago, and different, talking a to be morning

that bit I there some think wavered instance [indiscernible] bottom. again, had signs come and of We little the for what it, the still talked last They had we're in seeing are there takes. month. a the the puts U.S. are about here off

potentially see broader recovery might we in the some So with just macro. nylon seesaw

David Silver

Okay, thank it. you that. appreciate I all for

Erin Kane

course. Of


please from ahead. next Stifel, The of Anderson comes question go Instructions] Vincent [Operator

Vincent Anderson

morning, guys. Good Thanks.

Erin Kane

Good morning.

Vincent Anderson

guidance you has could results quick timing just Or year-on-year? some talk it from really the on for the just improvements? about XXXX. turnaround was I hoping maybe that projects that Was is smaller your maintenance the execution more there differences lower

Erin Kane

that. I'm happy to address

think I it. Vincent, a may combination, it's as call you

asset large will year. we you other our sort of every turnarounds we remind So that alternate

partners But fact continued note would Kellogg year, of take elevated I of I would of think sort our, years the locked, the to with that you be next rates impact we at So partnership large have maintenance ways, does we've we organization. and look our versus which scope, that the did at strategies, considerations capital year. a up we've look sort turnaround would influence When actually using out we has plant if strong sulfuric reflect, will run. which I that our say it scheduling, on look this we've our [ph] just execution, lean inside it you be nearly and acid also scope absorption a sort expense about the wrench integrated could over time scope talked at will more tools on global our our of

chain every drive the of turnarounds. their we So against onto focus the now, elevated group and as supply at turnaround leader team productivity, of safety team well with actually drive we that efficiency, we've turnaround a site consistent to leadership this leadership the on startups integrated have these have drive leaders

head. we So it is combination, continue but the pleased definitely where we're to with

Vincent Anderson

then you of this into sulfate thanks. how quarter, for crop distribute the parts of pre-buying I'm seen know I common of from through sell but farmers, I Brazilian seen in kind specifically the Brazil that the pre-selling basically distributors them, you is in apologize, for there? through any exchange which did that Brazil, assume then And comments Excellent, that some conversations? massive they crop if and I mentioned in you year's of output season, early if crop it, you by this volumes event any next in farmers have U.S. but wondering that event pledged I do? missed inputs ammonium And we've

Erin Kane

at million on up million domestic to ended million you that, talk side. of have considerations, the from the kind few for that. the $XX on higher $XX the end that we season of close our one, things: a saw a sequential sort We in $XX again, mix the typically perspective, to in would We quarter. overall can tackle because range changes When of about seasonality look we July more extending beneficial end to of the that

positive in did we buying on us So for sequentially that as standard up was the see certainly and as into the well. again, expected quarter side export we a was

quarter maybe the pertains progressed this anticipated just So remarks coming - in that our would as And more sort are the have granular into as I call. pre-buys domestic less a do to the we for had or it we say - of pre-buys clarification would season.

of So we side really relative export aren't the that to the house. participating

Vincent Anderson

right. All Okay.

So the then balance right is early direction. absolutely one, we'll moving about maybe next the that hear year. All so last so in sheet right. more And

replacement open headwinds and your You you, assets. Or over any If unlocks and structurally sources, changed long-term maybe opportunities I'm any shares and big minority from in OSB monetizing maybe phenol obviously bit positive your some through of MDI a the incremental long supply on the acetone between your or still this maybe of share this value domestic product flows? interest around a assets your value as oxidation have does agreement term, up and [ph] discount that a the portion off-take has thoughts taking what about derisk cumene unit? thinking cash with for a

Erin Kane

sort opportunities opposed When also say to best is We're way a optimize system, our up succeed the to we of We amounts forward moving we Vincent, ability yield not best was from partnerships drive that from a thanks the would answer the in appropriate right about we're and will at I way we to make to that our continue whether here allow us that we the think that in sure down flow think have again, that I to in perspective. perspective it's cash when think and in that and long the I look value for ability the conversion clear opportunity, chain. the our to for notice to direction. wanted you and today, the free for that look haul. confidence growth

and/or I those think then to life. to opportunities firm right time bring for us up, basis be on particular the that it's projects would those inorganic

Vincent Anderson

you. thank right, All


concludes This for session, to would remarks. our the Erin to closing I answer over question back like and Kane turn conference

Erin Kane

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

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executing a and resiliency have against, that rigorous of focused by being are We we're underpinned of enhancing strong commitments stewards - global all operational our our position. on low-cost capital portfolio disciplined strategy which built and excellence,

So you quarter. speaking with Stay that, again next forward safe look with and we'll to well. be


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

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