Orion S A : Annual Report 2024

Published: 2025-05-07 04:13:52 ET OEC

Published on 05/07/2025 at 04:13

Driving innovation...

...enabling the everyday

Annual Report 2024

Driving innovation, enabling the everyday

Orion S.A. (NYSE: OEC) is a leading global supplier of carbon black, a solid form of carbon produced as powder or pellets.

The material is made to customers' exacting specifications for tires, coatings, ink, batteries, plastics and numerous other

specialty, high-performance applications. Carbon black is used to tint, colorize, provide reinforcement, conduct electricity, increase durability and add UV protection.

Orion has innovation centers on three continents, and we produce at 15 manufacturing plants worldwide, offering the most diverse variety of production processes in the industry. The company's corporate lineage goes back more than 160 years in Germany, where it operates the world's longest-running carbon black plant.

Orion is a leading innovator, applying a deep understanding of customers' needs to deliver sustainable solutions.

The company is dedicated to generating long-term benefits for all stakeholders, while remaining committed to responsible business practices with an emphasis on team culture, reliability, innovation and sustainability.

Our successes as a company are a result of multiple years of focused attention to executing on today's mandates and positioning the company for accelerated and balanced returns for many years to come.

FINANCIAL HIGHLIGHTS

Orion S.A. Annual Report 2024

Total sales

Adjusted EBITDA1

Adjusted Diluted EPS1

($ in billions)

($ in millions)

($)

2024

$1.9bn

$302m

$1.76

2024

$1.9bn

2024

$302m

2024 $1.76

2023

$1.9bn

2023 $332m

2023 $1.92

2022 $2.0bn

2022 $312m

2022 $1.96

2021 $1.5bn

2021 $268m

2021 $1.73

1. Reconcilliations of non-GAAP measures to the most directly comparable US-GAAP measures for Adjusted EBITDA and Adjusted EPS can be found on page 7 of this report.

Achieved

Repurchased

OTHER HIGHLIGHTS

Third consecutive year

Resumed share buyback activity

In 2024 we delivered $300+

$300m+ ~2%

million of Adjusted EBITDA -for our third consecutive year

of Adjusted EBITDA. Demonstrated resilience, despite PMI contraction, import-driven headwinds.

Advanced industry's circularity leadership

Produced from

of shares outstanding, ahead of anticipated free cash flow inflection 2025-26.

Broke ground on Specialty conductives plant

Orion on track for

despite progressively challenging funadamental headwinds, demonstrating the resilience of Orion's business portfolio.

Corning F. Painter

Chief Executive Officer

100% $500m

tire pyrolysis oil (TPO) feedstock. Uniquely positioned to produce scaled volumes of sustainable grades.

of EBITDA capacity. Unique acetylene black capability bolsters Specialty segment capabilities, growth profile.

2 Orion S.A. Annual Report 2024

Dear fellow shareholders

Corning F. Painter

Chief Executive Officer

/ /

What are potential implications of a new global trade framework? We see a great opportunity for Orion to distinguish itself among chemical industry peers.

We believe the company's EBITDA and our stock's valuation metrics from 2024 neither reflect the substantial positive progress Orion has continued to make, nor do

they represent the company's performance potential looking forward. Despite progressively challenging headwinds

that emerged, our results in 2024 were a testament to the resilience of our business and organization.

Before reflecting on Orion's 2024 accomplishments, I am certain

what is more top of mind for investors is figuring out how to navigate a suddenly less predictable macro backdrop and understanding the

implications of the ongoing geopolitical crosscurrents for their portfolio companies or potential investments. Under what could be a new paradigm that shifts trade away from globalization, 2025 appears to

be setting up for yet another year for testing Orion's resilience. I see the ongoing disruption and related challenges as a great opportunity for Orion to distinguish itself, particularly in a world where manufacturing relies more on localized production and supply chains.

What are Potential Implications of a New Global Trade Framework?

Our single biggest challenge was softer Rubber segment demand, and the most significant headwind was the impact on our tire customers from an elevated level of tire imports, which undermined demand for their brands. Thus, tariffs targeting the most significant tire exporters, particularly those in Southeast Asia, should relieve pressure on local tire production. Tariffs announced thus far have been both broader and larger than most originally anticipated, and this has created macro uncertainty.

Expectations for a recession have consequently increased, and there may be a variety of implications from the emerging new trade paradigm, both positive and negative. As just one example, the Euro has appreciated year-to-date; thus, FX translation should become a tailwind for Orion. Certain specialty grades exported around the world by us

and our competitors may be subjected to tariffs, creating both cost challenges but also opportunity. Overall, we expect Orion's gains from more localized production and related supply chains will help cushion potential adverse impact from a recession, should one materialize.

Challenges Emerged Progressively as 2024 Unfolded. Reflecting on 2024… no question about it - if judged solely by our earnings progression and share price performance, it was a disappointing year for Orion. While still healthy by historic standards,

our EBITDA generation of ~$302 million was down about 9% compared to 2023, and our stock price declined 43% in value. After a relatively strong start to the year, including robust first quarter 2024 results,

we expected much better.

At the risk of sounding clichéd, we certainly do not believe these metrics reflect the substantial positive progress Orion has continued to make as an organization, nor do they represent the company's performance potential looking forward.

Reflecting conviction about Orion's much higher intrinsic value, we resumed share repurchases under our 5+ million share buyback authorization. In 2024 alone, we bought back ~2% of shares outstanding, deploying about $20 million for repurchases in anticipation of a strong impending inflection in our free cash flow in 2025-2026.

Since instituting our buyback program in late 2022, we have reduced our absolute share count by more than 7%.

KEY KPIS IN FOCUS

EBITDA Generation

$300m+

for Third Consecutive Year. Based on initial guidance, Orion anticipates mid single-digit constant currency EBITDA growth in 2025.

Improving free cash flow (FCF) conversion

~50% 75%

Reduced growth capex needs, coupled with working capital and other initiatives, should help sharply improve FCF conversion metrics.

Continued buyback capacity, appetite

Net reduction in shares outstanding. Without taking leverage risk, we have bought back about 7% of shares outstanding in a little more than two years, and envision capacity for additional return of capital shareholders, considering our stock's valuation and improving free cash flow prospects.

On this point, we understand our stock's valuation serves as a proxy for our company's future prospects, and the market's current assessment of our future is far short of our view - especially with our valuation multiple below the low end of its historic trading averages. Just a few considerations here:

The carbon black industry is arguably healthier than it's been in decades, including prospectively snug supply/demand fundamentals in our key North American market, looking beyond a potential trade war-induced recession.

Orion is in an excellent position to take advantage of the ongoing secular shift away from globalization towards "regionalism", where re-shored production will rely more on local supply chains.

We are concluding several years of elevated capital spending, hence our free cash flow generation is poised to improve sharply.

We believe the confluence of these dynamics should ultimately play

to our strengths and enhance returns, translating into a more favorable view of Orion's future than our current valuation implies. In short, we believe Orion's intrinsic value is materially higher than reflected in our current valuation.

We Resumed Share Repurchases in 2024, Reflecting our View on Orion's Higher Intrinsic Value.

Underscoring conviction on this last point, we resumed share repurchase activity in 2024, ahead of the improvement in free cash flow expected in 2025 and beyond. Since August of 2024, including the first quarter of 2025, we have spent about $36 million on repurchases, buying back roughly 4% of our shares outstanding. And in a little over two years now, since our program's authorization in December of 2022, we have repurchased about 5.3 million shares representing 9% of shares outstanding - or about 8% on a net basis, after incentive-based reissuance. While most companies focus on their gross repurchase amounts, we are focused on the true reduction in shares outstanding; we believe our meaningful net reduction will prove beneficial to our shareholders.

Free Cash Flow and Shareholder Friendly Capital Allocation Will be a Key Theme Into Foreseeable Future.

Looking forward, and considering our dramatic reduction in 2025 and 2026 in growth capital, we expect Orion's sharply improving excess free cash flow (FCF) will be allocated predominantly towards debt paydown and/or share repurchases. We can grow by executing on the investments made to date; we do not need significant growth capital once we finish building our La Porte plant. We believe this FCF inflection and shift in capital allocation will be a key catalyst to help unlock greater value.

LOOKING FORWARD

Diminished capital spending needs, greater free cash flow conversion

Shift towards operational excellence; prioritized return-driven projects; preventative maintenance

Value via exploiting leadership position in specialties, circularity

LOOKING BACKWARD

Burdened with EPA-mandated Capex, Deferred maintenance spending

Reactive plant maintenance, responding to unplanned downtime

Building toward $500m of Adjusted EBITDA capacity

Reduced capital spending outlook portends free cash flow inflection ($ in millions)

$145

$29

$61

$215

$59

$95

$233

$81

$67

$171

$44

$20

$29

$207

$37

$66

$160

$110

$55

$61

$85

$78

$103

Recapping 2024 Results.

Orion achieved over $300 million of EBITDA during 2024 for its third consecutive year. This was despite nearly two and a half years of PMI contraction in key European and North American markets, which comprise roughly two-thirds of company sales. Juxtaposed another way, consider a comparison of 2024 results to the 2016-2018 timeframe. Last year's EBITDA was nearly 14% higher than the average during those pre-pandemic levels, despite ~15% lower volumes on average. A big part of these lower volumes are due to higher tire imports into our key markets. Also notable, the Euro's value was roughly 5% lower last year compared to the average 2016-2018 exchange, and thus a modest headwind. With about 40% of our sales derived in EU countries, we

get translation benefit from a stronger Euro.

Let's Take a Look How 2024 Evolved, By Segment.

Rubber Segment Demonstrated Resilience in 2024, Even as Key Customers Were Impacted by Elevated Imports.

After record Rubber segment results in 2023, Rubber demand moderated throughout much of 2024, as customers progressively pared their forecasts as the year elapsed. The primary challenge for our customer base has been the propensity of consumers to trade down to lower-value replacement tires, usually imported, partly because

of inflationary pressures on their discretionary spending. Western tire production levels consequently came under pressure because of what our key customers have described as "unprecedented" levels

of tire imports, fueling the trade-down dynamic.

These distorted trade flows hurt Orion in particular, because of our strong position in the U.S. and Europe, and an over-indexing to top-tier tire brand customers - those hurt most by the trade-down phenomenon. Our customers effectively lost share downstream in their dealer and retailer channels. Normalization of these trade flows moving forward would benefit Orion.

2020 2021 2022 2023 2024 2025F 2026F

Maintenance EPA LAP Growth/Other Projected Growth

No meaningful additional growth capital is needed near-term to achieve our financial goals. We expect that reduced capital spending will translate into higher Free Cash Flow conversion.

Specialty Segment Volumes Recovered Strongly in 2024, but Earnings Power is Still Much Greater.

After subdued demand conditions in 2023, during which certain

key Specialty end markets endured destocking activity, our Specialty segment exhibited broad volume recovery, which were 11% higher in 2024 than prior year levels. Notably, this recovery was most pronounced in higher volume but lower value markets, diminishing overall mix. Adverse mix, the absence of a higher cogeneration contribution (which added to Specialty results in 2023), and other discrete cost headwinds and operational challenges constrained Specialty profit growth. Our strategic plans include the restoration of our Specialty segment's inherently greater earnings power.

We Made Additional Progress Towards Longer-Term Sustainability Goals.

During 2024, we advanced our circularity leadership by establishing formal partnerships including our investment in a European tire recycling company that will facilitate the ramping of commercial scale quantities of tire pyrolysis oil (or TPO) from recycled tires.

Orion is uniquely positioned to produce large-scale volumes of circular grades of carbon black for customers focused on these sustainable solutions.

Looking Forward, Uncertainty Abounds… but our Business has Proven Resilient Through More Challenging Times.

Most recently, capital markets have exhibited a great deal of volatility, on concerns associated with a potential end to globalization and related trade wars. Global industrially-oriented sectors, including the chemicals space, have been hit hard and small caps including Orion have been treated even more punitively. While a great deal of uncertainty underpins this volatility, we believe Orion's durability

is being underappreciated. Beyond that, we expect our substantial positions in the U.S. and Europe to be advantaged in a shift towards more localized supply chains.

Our company has been tested through a variety of macroeconomic scenarios, and the business has exhibited resilience time and again. Prior to becoming public, the business was managed through economic cycles with higher leverage levels. Volumes declined 15% during 2020 when the Covid-19 pandemic shut down the global economy, but rebounded more than 11% in 2021 despite still subdued economic conditions. Perhaps the most potentially salient example was our performance coming through the 2008-2009 global financial crisis, a.k.a. the "Great Recession". Orion's overall volumes did decline about 14% in 2009, but that was notably following +25% growth in 2008. In 2010, volumes recovered nearly 15% to levels that almost reached those peak 2008 levels, and were about 23% higher than 2007 levels.

Emerging Stronger: Uncertainty Creates Opportunity, and our Tactical Actions Will Help Navigate the Current Backdrop, to Capitalize.

As a smaller and lean company, we believe we can effectively leverage our flexibility and agility to create upside opportunities during uncertain times. For example, slower conditions can allow for greater customer engagement and intimacy, as well as accelerated product qualifications. We will focus relentlessly on executing through these disruptive times, while balancing both short- and long-term objectives. We will look to strategically exploit upside cases, and work hard to mitigate potential negative implications. When all the disruption

dust settles, we believe Orion's innate resilience will once again shine. And as we pass this latest proverbial test as an organization, we believe capital markets skepticism will fade, helping unlock the greater value that we and you, as patient shareholders, deserve.

Corning F. Painter

Chief Executive Officer

Reconciliation of Non-GAAP measures Adj. EPS and Adj. EBITDA

2021 - 2024

EPS to Adjusted EPS (in $ per share)

Twelve Months Ended December 31,

2024

2023

2022

2021

Diluted EPS

0.76

1.73

2.22

Long Term Incentive Plan

0.26

0.13

0.09

Add back Environmental reserve

(0.04)

(0.01)

0.12

Other Adjustments including restructuring

(0.02)

0.01

0.03

0.05

Amortization of Acquired Intangible Assets

0.13

0.12

0.11

0.13

Foreign Exchange Rate Impacts to Financial Results

0.02

0.04

0.03

0.10

Amortization of Transaction Costs

0.13

0.05

0.03

0.07

Reclassification of Actuarial gains from AOCI

(0.15)

0.08

Misappropriation of assets, net

0.95

Professional fees related to misappropriation of assets

0.06

Tax Effect on Add Back Items

(0.43)

(0.10)

(0.09)

0.19

Adjusted diluted EPS

1.76

1.92

1.96

1.73

Net Income to Adjusted EBITDA (in millions)

Twelve Months Ended December 31,

2024

2023

2022

2021

Net Income

104

106

135

Income tax expense

Equity in Earnings of Affiliated companies

(1)

Income before earnings in affiliated companies and income taxes

163

157

186

Finance costs, net

Reclassification of Actuarial (gains)/losses from AOCI

(9)

Income from Operations (EBIT)

103

205

197

229

Depreciation and amortization

125

113

106

104

EBITDA

228

318

303

333

Loss due to misappropriation of assets, net

Other non-operating

(64)

Adjusted EBITDA

302

332

312

268

Washington, D.C. 20549

FORM 10-K

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2024 OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-36563

ORION S.A.

(Exact name of registrant as specified in its charter)

Grand Duchy of Luxembourg 00-0000000

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

1700 City Plaza Drive, Suite 300 Spring Texas 77389

(Address of Principal Executive Offices) (Zip Code)

(281) 318-2959

Registrant's telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stocks, no par value

OEC

New York Stock Exchange

Securities registered pursuant to section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes  No 

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes  No 

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and

(2) has been subject to such filing requirements for the past 90 days. Yes No 

Indicate by check mark whether the registrant has electronically submitted every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer, "accelerated filer", "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer  Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the Registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. 

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b).  Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No x

The aggregate market value of voting and non-voting common stock held by non-affiliates of the registrant on June 30, 2024, the last business day of the registrant's most recently completed second fiscal quarter, based on the closing price on that date of $21.92, was approximately $1.28 billion.

The registrant had outstanding 56,654,098 shares of common stock as of February 14, 2025.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Company's 2025 Proxy Statement, in connection with the Company's 2025 Annual Meeting of Shareholders (in Part III), as indicated herein.

TABLE OF CONTENTS

Page

Cautionary Statement for the Purposes of the "Safe Harbor" Provisions of the Private Securities Litigation Reform Act of 1995 ............ i

PART I ........................................................................................................................................................................................................... 1

Item 1. Business ............................................................................................................................................................................................. 1

Item 1A. Risk Factors .................................................................................................................................................................................... 8

Item 1B. Unresolved Staff Comments ........................................................................................................................................................... 20

Item 1C. Cybersecurity .................................................................................................................................................................................. 21

Item 2. Properties ........................................................................................................................................................................................... 22

Item 3. Legal Proceedings.............................................................................................................................................................................. 22

Item 4. Mine Safety Disclosures .................................................................................................................................................................... 22

PART II.......................................................................................................................................................................................................... 23

Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities ........................ 23

Item 6. Reserved ............................................................................................................................................................................................ 24

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations ........................................................... 25

Item 7A. Quantitative and Qualitative Disclosures About Market Risk ....................................................................................................... 32

Item 8. Financial Statements and Supplementary Data ................................................................................................................................. 34

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure ........................................................... 72

Item 9A. Controls and Procedures ................................................................................................................................................................ 72

Item 9B. Other Information ........................................................................................................................................................................... 72

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections............................................................................................ 73

PART III ....................................................................................................................................................................................................... 75

Item 10. Directors, Executive Officers and Corporate Governance .............................................................................................................. 75

Item 11. Executive Compensation ................................................................................................................................................................. 76

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters ....................................... 76

Item 13. Certain Relationships and Related Transactions, and Director Independence ................................................................................ 76

Item 14. Principal Accounting Fees and Services 76

PART IV ....................................................................................................................................................................................................... 77

Item 15. Exhibits, Financial Statement Schedules......................................................................................................................................... 77

Item 16. 10-K Summary ................................................................................................................................................................................ 77

SIGNATURES............................................................................................................................................................................................... 80

Cautionary Statement for the Purposes of the "Safe Harbor" Provisions of the Private Securities Litigation Reform Act of 1995

This report contains and refers to certain forward-looking statements with respect to our financial condition, results of operations and business. These statements constitute forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Forward-looking statements are statements of future expectations that are based on management's current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. Forward-looking statements include, among others, statements concerning the potential exposure to market risks, statements expressing management's expectations, beliefs, estimates, forecasts, projections and assumptions and statements that are not limited to statements of historical or present facts or conditions.

Forward-looking statements are typically identified by words such as "anticipate," "assume," "assure," "believe," "confident," "could," "estimate," "expect," "intend," "may," "plan," "objectives," "outlook," "probably," "project," "will," "seek," "target," "to be" and other words of similar meaning. These forward-looking statements include, without limitation, statements about the following matters:

our strategies for (i) maintaining or strengthening our position in Specialty Carbon Black or Rubber Carbon Black, (ii) maintaining or increasing our Specialty or Rubber Carbon Black margins and (iii) maintaining or strengthening the competitiveness of our operations;

our profit and cash flow projections;

the outcome of any in-progress, pending or possible litigation or regulatory proceedings;

the expectations regarding environmental-related costs and liabilities;

the expectations regarding the performance of our industry and the global economy, including foreign currency rate fluctuations;

the sufficiency of our cash on hand, cash provided by operating activities and borrowings to pay our operating expenses, satisfy our debt obligations and fund capital expenditures;

the ability to pay dividends;

our anticipated spending on, and the timely completion and anticipated impacts of, capital projects including growth projects, and the construction of new plants;

our projections and expectations for pricing, financial results and performance in 2024 and beyond;

the status of contract negotiations with counterparties and the impact of new contracts on our business;

our expectation that the markets we serve will continue to demand our products;

our internal controls over financial reporting; and

loss due to misappropriation of assets and potential recoveries of such loss.

All these forward-looking statements are based on estimates and assumptions that, although believed to be reasonable, are inherently uncertain. Therefore, undue reliance should not be placed upon any forward-looking statements. There are important factors that could cause actual results to differ materially from those contemplated by such forward-looking statements. These factors include, among others:

possible negative or uncertain worldwide economic conditions and developments;

the operational risks inherent in chemicals manufacturing, including but not limited to disruptions due to technical difficulties, severe weather conditions or natural disasters;

our dependence on major customers and suppliers;

our ability to compete in the industries and markets in which we operate;

our ability to successfully develop new products and technologies;

our ability to effectively implement our business strategies;

the volatility of costs, quality and availability of raw materials and energy;

our ability to realize benefits from investments, joint ventures, acquisitions or alliances;

our ability to realize benefits from planned plant capacity expansions and planned and current site development projects;

any information technology systems failures, network disruptions and breaches of data security;

our exposure to political or country risks inherent in doing business globally;

rapidly changing geopolitical environment, conflicts, growing tension between U.S. and other countries, and/or any other escalations may impact energy costs, raw material availability or other economic disruptions;

our ability to comply with complex environmental, health and safety laws and regulations, and current and any possible future investigations and enforcement actions by governmental, supranational agencies or other organizations;

environmental, social and governance matters, including regulations requiring a reduction of greenhouse gas emissions or that impose additional taxes or fees on emissions as well as increased awareness and adverse publicity about potential impacts on climate change by us;

development regulation of carbon black as a nano-scale material;

our operations as a company in the chemical sector, including the related risks of leaks, fires and toxic releases as well as other accidents;

any changes in European Union regulations or similar international regulations on chemical carbon that will affect our ability to market and sell our products;

any market or regulatory changes that may affect our ability to sell or otherwise benefit from co-generated energy;

any litigation or legal proceedings, including product liability, environmental or asbestos related claims;

our ability to protect our intellectual property rights and know-how;

risks associated with our financial leverage;

restrictive effects of the covenants in our debt instruments;

any deterioration in our financial position or downgrade of our ratings by credit rating agencies;

any fluctuations in foreign currency exchange or interest rates;

the availability and efficiency of hedging;

any potential impairments or write-offs of certain assets;

any required increases in our pension fund or retirement-related contributions;

the adequacy of our insurance coverage;

any challenges to our decisions and assumptions in assessing and complying with our tax obligations;

any changes in our jurisdictional earnings mix or in the tax laws or accepted interpretations of tax laws in those jurisdictions;

the ability to pay dividends on our common stock at historical rates or at all;

the difference between our stockholders' rights and rights of stockholders of a U.S. corporation;

the potential difficulty in obtaining or enforcing judgments or bringing legal actions against Orion S.A. (a Luxembourg incorporated entity) in the U.S. or elsewhere outside Luxembourg;

the difference between Luxembourg & European insolvency and bankruptcy laws from U.S. insolvency laws;

our relationships with our workforce, including negotiations with labor unions, strikes and work stoppages;

our ability to recruit or retain key management and personnel;

any disruptive changes in international and local economic conditions, dislocations in credit and capital markets and inflation or deflation; and

our ability to generate the funds required to service our debt and finance our operations.

It is not possible for our management to predict all risk factors and uncertainties, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. For further information regarding factors that could affect our business and financial results and the related forward-looking statements, see "Item 1A. Risk Factors."

PART I

Item 1. Business Overview

Orion S.A. ("Orion", "Company", "we" or "our"), is a Luxembourg joint stock corporation (société anonyme or S.A.), incorporated in 2014 as a Luxembourg limited liability company (société à responsabilité limitée). Our registered office is located at 6, Route de Trèves, L-2633 Senningerberg (Municipality of Niederanven), Grand Duchy of Luxembourg. Our principal executive office is located in Spring, Texas, U.S.

We are a leading global manufacturer of carbon black products. Carbon black is a powdered form of carbon that is used to create a variety of desired physical, electrical and optical qualities of various materials. Carbon black products are primarily used as additives for the production of polymers, batteries, printing inks and coatings ("Specialty Carbon Black" or "Specialty") and in the reinforcement of tires and other rubber applications ("Rubber Carbon Black" or "Rubber"). Our core competencies include the ability to engineer the physical properties of carbon black to meet the functional needs of our customers. The Company is one of the largest global producers of Specialty and Rubber Carbon Black.

We currently operate 14 wholly owned production facilities, excluding the under-construction facility at La Porte, Texas, in Europe, North and South America, South Africa, and Asia, and one jointly-owned production facility at Dortmund, Germany. In addition to our headquarters in Luxembourg, we have our principal executive office in Spring, Texas (U.S.), as well as offices in Frankfurt (Germany), Cologne (Germany), Shanghai (China), Seoul (South Korea), Tokyo (Japan), Sao Paolo (Brazil) and other locations. Our principal research and development ("R&D") center is located in Cologne (Germany). We also have laboratories to support our customers in Carlstadt, New Jersey (U.S.), Shanghai (China) and Yeosu (South Korea).

We are a premium supplier of carbon black generating long-term benefits for stakeholders while remaining committed to responsible business practices with a focus on team culture, reliability, quality and sustainability.

Our business is organized into two reportable segments: Specialty Carbon Black and Rubber Carbon Black. Our business segments are discussed in more detail later in this section.

Our internet address is https://www.orioncarbons.com. We make available, free of charge on or through our website, our current Annual Reports in Form 10-K, Quarterly Reports in Form 10-Q, reports in Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after electronically filing such material with, or furnishing it to, the U.S. Securities and Exchange Commission ("SEC"). Information appearing on our website is not a part of, and is not incorporated in, this Annual Report in Form 10-K.

Products and Applications

Carbon black is manufactured in a highly controlled process to produce particles and aggregates of varied structure and surface chemistry, resulting in many different performance characteristics for a wide variety of applications.

Specialty Carbon Black

The Company manufactures Specialty Carbon Black for a broad range of specialized applications such as polymers, batteries, printing and coatings. The various production processes result in a wide range of different Specialty Carbon Black grades with respect to their primary particle size, structure, surface area and surface chemistry. These parameters affect jetness, tinting strength, undertone, dispersibility, electrical conductivity and other characteristics. Carbon black is an additive that enhances the physical, electrical and optical properties of our customer's end products.

We have several post-treated Specialty Carbon Black grades for coatings and printing applications, as well as several high purity carbon black grades for the fiber industry and conductive carbon black grades for batteries, polymers and coatings. Our specialty grades of carbon black are used to impart color, provide rheology control, enhance conductivity and static charge control, provide UV protection, enhance mechanical properties and provide formulation flexibility through surface treatment. These specialty carbon products are used in a wide variety of applications, such as coatings, inks, plastics, adhesives, toners and batteries.

Products

Carbon Black for Coatings-We offer a broad range of Specialty Carbon Black products for coatings, which includes products used for pigmentation and protection (e.g., automotive base coats and architectural coatings), for conductivity and for tinting, as well as for paints and for light tinting in transparent coatings (e.g., metallic effects and wood glazing). The diversity of our manufacturing processes allows for the creation of a wide range of Specialty Carbon Black grades with different structures and chemical properties, thereby allowing our products to impart unique characteristics to our customers' products.

Carbon Black for Polymers-We offer Specialty Carbon Black for polymers in a diverse range of end markets, including pipe (e.g., gas, oil, municipal water, sewage), construction, energy distribution (e.g., power cables), automotive, agriculture and

consumer packaging. Certain products within this portfolio provide UV protection against polymer degradation for material such as pipe used for potable water, injection molding, agriculture films and cables. Other products include standard- to high-performance grades designed and modified to provide electrical conductivity, antistatic and reinforcing properties to many different polymer applications, including high-voltage cables, film and high-pressure pipes.

Carbon Black for Printing-We offer Specialty Carbon Black for printing inks used in different printing systems and applications. We apply different process technologies to offer highly specialized products meeting specific requirements, including compliance with food-contact regulations and specially formulated products that require unique attributes such as color undertone, optical density and gloss.

Carbon Black for Batteries-We offer conductive additives for lithium-ion batteries for electric vehicles, energy storage and consumer applications. They can be used both in the cathode and anode. We also offer conductive additives for lead-acid batteries, supercapacitors and dry cell batteries. Our products, which are manufactured in different production processes, are differentiated by high purity, high conductivity, low moisture and easy dispersion, enhancing the performance, lifetime and safety of batteries.

Competition

We are one of the largest global producers of Specialty Carbon Black. There are two other large global producers of Specialty Carbon Black. Besides that, there are regional Specialty Carbon Black producers, as well as technology specialists such as acetylene black producers. Orion differentiates by offering the broadest process technology portfolio and Specialty product portfolio to its customers.

Rubber Carbon Black

Our Rubber Carbon Black products are used in tires and mechanical rubber goods ("MRG"). Rubber Carbon Black are used to enhance the physical properties of the systems and applications in which they are incorporated. Rubber Carbon Black have traditionally been used in the tire industry as a rubber reinforcing agent to increase tread durability and are also used as a performance additive to reduce rolling resistance and improve traction. In MRG, such as hoses, belts, extruded profiles and molded goods, Rubber Carbon Black is used to improve the physical performance of the product, including the product's physical strength, fluid resistance, conductivity and resistivity.

Products

Carbon Black for Tires-We offer a broad range of carbon black products for tires, which includes high-reinforcing grades and semi-reinforcing grades. Fine particle reinforcing grade carbon black is used mostly in the tread of tires. Other reinforcing grade carbon black is also used in different components of the tire carcass. In addition to standardized grades, we produce advanced grades tailored to meet specific customer performance requirements, such as ECORAX® grades designed to lower rolling resistance and high-performance grades for truck tires and high- and ultra-high-performance passenger car tires.

Carbon Black for Mechanical Rubber Goods-We produce a wide range of carbon black products for a variety of MRG end-uses, including automotive production, construction, as well as certain food, consumer and medical applications. These grades have an exceptionally high purity and high consistency and satisfy special requirements needed for smooth surfaces and electrical resistance. These grades also disperse well in rubber compounds used in parts like window seals, automotive hoses, transmission belts, damping elements and electrically conductive and antistatic rubber goods.

Competition

We are one of the leading global producers of Rubber Carbon Black. We compete with two other global companies and multiple regional companies. The smaller regional suppliers mainly participate in standard and MRG applications and are less likely to provide specialized products used in higher-end tire and MRG applications. Competition for our Rubber Carbon Black products is generally based on product quality and performance, supply reliability, technical innovation and customer service.

Drivers of Demand

Besides general global economic conditions, certain specific drivers of demand for carbon black differ among our operating segments. Specialty Carbon Black has a wide variety of end-uses and demand is largely driven by the growth and development of the coatings, polymers, printing and battery industries. Demand for Specialty Carbon Black in the coatings and polymers industries is mainly influenced by the levels of industrialization, automobile original equipment manufacturer ("OEM") demand, infrastructure development, consumer spending and construction activity. Demand for Specialty Carbon Black in the printing industry is mainly influenced by developments in print media and packaging materials. Demand for Specialty Carbon Black in the batteries industry is driven by electric vehicle penetration, growth of consumer and industrial batteries business and energy storage systems use. Demand for Rubber Carbon Black is largely driven by the growth and development of the automotive tire, commercial tire and MRG industries. Demand for Rubber Carbon Black in tires is mainly influenced by the number of replacement and original equipment tires produced, which in turn is driven by (i) the number of miles driven and truck traffic, (ii) vehicle trends, including the number of vehicles produced and operated, (iii) demand for larger vehicles, such as trucks and buses, (iv) demand for high-performance tires, (v) consumer and industrial spending on replacement tires and on new

vehicles, and (vi) changes in regulatory requirements. Demand for Rubber Carbon Black in MRG is mainly influenced by vehicle production and design trends, construction activity and general industrial production.

Customer Contracts

Most of our long-term contracts, 12 months or longer, contain formula-driven price adjustment mechanisms for changes in raw material and/or energy costs. We sell carbon black under the following two main categories of contracts based on price adjustment mechanisms:

Contracts with feedstock adjustments (indexed contracts)-This category includes contracts with monthly or, in some cases, quarterly automatic feedstock and/or energy cost adjustments, which cover approximately 65% of our global volume;

Non-indexed contracts-This category includes short-term contracts (usually shorter than three months) where sales prices of our carbon black products are not linked to carbon black oil market prices.

Many of our indexed contracts allow for periodic price adjustments, while a small portion (by volume sold) allow for quarterly price adjustments. These contracts have enabled us to reduce the impact of fluctuations in oil prices on our margins; however, rapid and significant oil price fluctuations have had and are likely to continue to have significant effects on our earnings and results of operations given (i) not all contracts contain price adjustment mechanisms and (ii) the value of our productivity improvements rises and falls with oil price movements.

See "Item 1A. Risk Factors-Risks Related to Our Business"-We are subject to volatility in the costs, quality and availability of raw materials and energy, which could decrease our production volumes and margins and adversely affect our business, financial condition, results of operations and cash flows. Sales prices under non-indexed contracts are reviewed on a regular basis to reflect raw material and energy price fluctuations as well as overall market conditions.

Raw Materials

The principal raw material used in the manufacture of carbon black is carbon black oil composed of residual heavy oils derived from petroleum refining operations, the distillation of coal tars and the production of ethylene throughout the world. The majority of our carbon black oil supply is covered by short and long-term contracts with a wide variety of suppliers. Natural gas is also used in the production of carbon black. These raw material costs generally are influenced by the availability of various types of carbon black feedstock and natural gas, supply and demand of such raw materials and related transportation costs. Some carbon black grades are also produced from acetylene gas, an off-gas received from other chemical producers. Changes in our raw material supplier's operating conditions and demand for their products could reduce the availability of such specialized feedstocks.

Seasonality

Our business is generally not seasonal in nature, although our results of operations are generally weaker in the last three months of the calendar year.

Innovation

We enjoy a long-standing reputation within the industry for carbon black product and process technology, applications knowledge and innovation. Carbon black products are highly versatile and meet specific performance requirements across many industries. This creates significant opportunities for product and process innovation. Further product innovations are a key competitive factor in the industry, even after decades of R&D in this field.

We maintain product applications and process development centers in Europe, Asia and the Americas. Our Innovation Group is divided into applications technology and process development teams, which cover both Specialty Carbon Black and Rubber Carbon Black. The applications technology team works closely with our major clients to develop innovative products and expand the applications range for carbon black products. The process development team works closely with our manufacturing and procurement teams to improve production processes, product quality and cost structure and advance the use of bio-circular feedstocks.

Our Innovation function's leading center of excellence is located in Cologne (Germany) to support and enhance our global innovation function as well as R&D activities. This center includes applications technology laboratories and process development staff, co-located with our pilot process development facilities. Staffing in our Cologne technical center includes physicists, chemists and engineers who collaborate to create and analyze various carbon black properties with a goal to identify existing products or develop new products to meet customer requirements. Common processes and information technology tools further enhance coordination and communication with our regional technical centers located in China, South Korea and the U.S.

Applications Technology-Our goal is to remain at the forefront of the industry in terms of product development by having dedicated applications technology facilities. Success relies on close collaboration with customers, often through long-term R&D alliances, which create superior technical interfaces. These interactions enable us to develop tailored solutions and meet unique customer requirements.

Our applications technology team brings together a deep knowledge of carbon black technology with an understanding of the key applications practiced by our customers. This team has access to extensive laboratory and testing facilities using similar formulations, processing and test methods employed by our customers. Customer collaborations often include cooperative testing with customers' staff in our facilities. Applications technology provides a key customer and market interface and translates specific customer needs into carbon black product attributes.

Applications technology plays a supporting role in the process of new product launches by providing technical data and presentations, training and support, and establishing and monitoring quality targets. Our team works closely with customers to provide support during the qualification cycle, which can be long and may last over several years. Our close cooperation decreases the likelihood of customers switching suppliers once a product has been approved.

Product quality test methods and applications testing are defined within the applications technology team. Methods are developed centrally and deployed worldwide to relevant production and applications laboratories to assure consistency in measurements and reporting.

Intellectual Property-We consider intellectual property development and management as a strategic competitive advantage. We initiate and maintain patents and trademarks, with varying expiration dates, on a number of our products and processes. We sell our products under a variety of patents and trademarks we own, and we take reasonable measures to protect them.

In connection with the separation of our business from Evonik Industries AG, Germany ("Evonik") more than ten years ago, Evonik assigned to us its intellectual property that was exclusively used in its carbon black business and granted certain intellectual property rights that are still also in use in Evonik's retained business in turn for us granting certain intellectual property rights to Evonik for fields outside of carbon black. Consequently, we may be restricted in leveraging intellectual property that we use on the basis of a license from Evonik or the intellectual property that is subject to grant-back licenses when expanding our business into fields outside of carbon black. For additional information, see "Item 1A. Risk Factors-Legal and Regulatory Risks-We may not be able to protect our intellectual property rights successfully."

Human Capital

We are a group of individuals who share one common passion: carbon black. Our success depends on attracting, recruiting, training and developing a talented global workforce. We believe people are at the heart of our business and work to advance a positive work culture. We strive to be an optimal employer for our employees, as well as a valued partner to our communities. We engage with our employees to provide a challenging, and dynamic work environment that supports each individual professional development, positive work environment, and long-term health and wellness. We are committed to promoting a workplace of belonging where our employees are informed, engaged and enabled to do their best work and be their best selves. We are also committed to providing our employees with opportunities for learning and personal growth in an environment where creativity and innovation are encouraged.

Aligning employee engagement and enablement remains a key component for the continued success of Orion. We have built a value system around a foundation of appreciating our employees through trust, respect and development. To ensure our employees are both motivated to do their work and equipped with the right tools and training to be successful, we start with listening. We regularly use employee surveys and feedback sessions to help ensure all the voices of our employees are heard. We continue to use the feedback to prioritize our human capital strategy and continue to upgrade our talent management programs, focusing on specific actions to improve learning and to promote employee development and career growth. Our talent programs are made up of several components:

formal learning programs to equip employees with the leadership, technical and functional skills required for their current and future roles;

on-the-job training through assignments that provide new roles and projects;

formal and informal mentoring programs;

succession planning;

empowerment groups;

formal and informal performance reviews with line managers and others; and

individual development plans.

Orion is made up of approximately 1,658 employees with four innovation centers and 14 wholly owned plants excluding the under-construction facility at La Porte, Texas. The company's corporate lineage goes back more than 160 years to Germany, where it operates the world's longest-running carbon black plant. Orion is a leading innovator, applying a deep understanding of customers' needs to deliver sustainable solutions, offering the most diverse variety of production processes in the industry.

We strive to create a welcoming environment where everyone can belong, grow and thrive. We place a premium on the freedom for our employees to be their authentic selves and offer an equal chance to bring different skills, backgrounds and experiences to work. To realize our commitments, we strive to:

Enable a trusting environment so employees are free to share individual experiences to increase understanding.

Promote an environment where each Orion employee owns the responsibility to exemplify inclusive behavior and treat others with respect, dignity and empathy.

Require our leaders to drive a culture that enhances inclusiveness, fairness, the ability to hire people talent whatever their background may be and ensure accountability within the company.

A focus on promoting from within has led to continued increases in internal fill rates for open positions and the involvement of business leaders across the organization in talent and succession planning reviews to assess employees on performance and future potential. These talent reviews continue to identify high potential employees, build bench strength, increase retention and help us identify our future leaders and innovators. These reviews also allow us to identify gaps in our organization and the actions needed to fill those gaps.

We uphold the freedom of association and fully recognize the right of collective bargaining. Certain of our employees are represented through unions and works councils. We value exchanging information and views with the local unions and works councils with the view to finding solutions to our common issues and ensuring success for both our employees and the Company.

Labor Relations

Our employees are represented by labor unions, industry groups and works councils in accordance with local law and practices. Membership in employee labor unions varies in accordance with the business area, local practice and country. We have entered into collective bargaining agreements with employee labor unions either directly or as members of industry-wide unions or employer organizations. Approximately 66% of our employees are covered by such agreements. These agreements typically govern, among other things, terms and conditions of employment and reflect the prevailing practices in each country. We believe we have stable relations with our employees, and voluntary turnover is low.

Environmental, Health and Safety Matters

Protection of people and the environment, fair treatment of our partners and a clear alignment to our customers' needs are essential components of our activities. We strive not only to comply with all applicable laws and voluntary obligations, but to continuously improve our performance and management systems. Our integrated global management system with established standards and processes is based on the principles of the Responsible Care 14001 for Environmental, Health, Safety and Security Management System, International Organization for Standardization's ("ISO") 9001 Quality Management System, ISO 14001 Environmental Management Systems and ISO 45001 Safety Management Systems. All of our operating sites are third-party certified to ISO 14001 and ISO 9001 standards. Our global management system outlines our processes and procedures practiced in relation to environmental protection, occupational safety, industrial hygiene, security and quality management as well as sustainable compliance and product stewardship.

Our annual sustainability report is accessible on our webpage: https://www.orioncarbons.com. Our sustainability report is not incorporated by reference into this Annual Report in Form 10-K.

Our operations involve the use, processing, handling, storage and transportation of materials that are subject to international, national and local environmental and safety laws and regulations. All our production facilities require operating permits. We believe that our operations are currently in substantial compliance with all applicable environmental, health, safety and security laws and regulations. Our management systems and practices are designed to ensure compliance with laws and regulations, and increasingly stringent regulation may require us to make additional unforeseen environmental, health and safety expenditures.

Environmental

Air Quality-One of the main environmental challenges of a carbon black plant is the management of exhaust gas from production processes. This exhaust gas contains a number of regulated pollutants, including carbon monoxide, nitrogen oxides and sulfur compounds. The most common method for controlling these gases is through combustion, which produces useable energy as a by-product. Currently, eleven manufacturing sites, including one jointly owned production facility, have the capability to beneficially utilize these gases through some form of energy co-generation, such as the sale or reuse of steam, gas or electricity.

The primary air pollutants of concern include sulfur dioxide ("SO2"), nitrogen oxides ("NOx") and particulates. In order to maintain compliance with emission requirements in certain jurisdictions, we utilize various de-NOx and desulfurization processes, as well as controlling sulfur levels in our feedstocks as needed. We control the particulate matter by using bag filter technology and following best management practices.

In the European Union ("EU"), we are subject to the EU Directive No. 2010/75/EU amended by 2024/1785 Directive on industrial emissions ("IED Directive"), which regulates pollution from industrial activities and includes rules aiming to reduce emissions into air, water and land and to prevent the generation of waste. In addition to the IED Directive and its implementation, European jurisdictions in which we operate may provide for further regulations regarding emission reduction and safety technology standards that apply to our facilities (for example, the German Emissions Control Act). In 2024, the EU Commission revised the EU measures addressing pollution from large industrial installations, as it was announced in the European Green Deal. The aims of the revision were to progress towards the

EU's zero pollution ambition for a toxic-free environment and to support climate, energy and circular economy policies. This included the revision of the IED Directive that was issued and implemented in 2024.

In the U.S., we are subject to emissions limitations on prevention of significant deterioration ("PSD") permits issued under the federal Clean Air Act ("CAA"), as well as analogous state and local laws, which regulate the emission of air pollutants from our facilities and impose significant monitoring, record keeping and reporting requirements. In addition, these laws and regulations require us to obtain pre-approval for the construction or modification of facilities expected to produce or significantly increase air emissions and to obtain and comply with air permits that include stringent conditions on air emissions and operations. In certain cases, we may need to incur capital and operating expenditures for specific equipment or technologies to control emissions. We have incurred, and expect to continue to incur, substantial administrative and capital expenditures to maintain compliance with CAA requirements.

Pursuant to the CAA, the U.S. Environmental Protection Agency ("EPA") has developed industry-specific National Emission Standards for Hazardous Air Pollutants ("NESHAPs") for stationary sources classified as "major" on the basis of their hazardous air pollutant emissions. Under these, we are required to comply with Maximum Achievable Control Technology ("MACT") standards. Our U.S. facilities are subject to MACT standards applicable to carbon black facilities, as well as MACT standards applicable to industrial boilers. The EPA amended existing carbon black MACT standards, which increased stack testing frequency and imposed more stringent startup and operating requirements for our U.S. plants. The U.S. plants are generally in compliance with MACT standards.

In China and South Korea, our operations have been subject to increasingly strict air quality regulations in recent years. We believe we are in substantial compliance with these regulatory changes in China and South Korea. We expect that future regulations may require additional capital and operating expenditures for specific equipment or technologies to control emissions that are being developed as needed to meet these new requirements.

Greenhouse Gas Regulation and Emissions Trading-Our facilities emit significant volumes of CO2. In the EU, all of our production facilities (except for our manufacturing site in France) are subject to the European Emission Trading System ("EU ETS") for CO2emissions. Industrial sites to which the EU ETS applies receive a certain volume of allowances in metric tons to emit greenhouse gases ("GHG") and must surrender allowances in equivalent volume for each metric ton of greenhouse gas ("GHG") emitted. Carbon black production is currently listed on the carbon leakage list, which allows receiving a certain quantity of needed emission allowances free of charge. From January 1, 2021, the EU ETS has stepped into its Phase 4 period running until 2030. However, as part of the EU Green Deal the EU has adopted a climate law enshrining its new climate targets of at least a 55% reduction in GHG emissions by 2030 compared to 1990 levels and net zero by 2050. The European Commission published its first part of the "Fit for 55" package in July 2021 to enable the EU to meet those targets. The actual EU ETS is expected to be subject to regular reviews and possible changes in order to ensure the way to achieve those climate reduction targets. These regular reviews are resulting in reduction of free emission certificates allocated to industrial installations in order to engage them meeting the reduction targets and being carbon neutral.

The design concept of the South Korean Emission Trading System is similar to the EU ETS. We may need to purchase emission rights for our South Korean plant to cover the shortfall where emissions exceed the quantity of free allowances, incurring additional costs.

In the United States, the EPA regulates GHG emissions under the CAA and has adopted rules that require reporting of GHG emissions by owners and operators of facilities in certain source categories, which include our facilities. At the state level, some states have already taken legal measures to reduce emissions of GHG, primarily through the planned development of GHG emission inventories and/or regional GHG cap-and-trade programs. Currently none of our plants are located in states that have implemented GHG cap-and-trade programs, but there is no assurance that future changes will not materially affect our operations or require material capital expenditures. The adoption of legislation or regulations that require reporting of GHG, establish permitting thresholds based on GHG emissions or otherwise limit or impose compliance obligations for emissions of GHG from our equipment and operations could require us to incur costs to obtain and comply with permits, reduce emissions of GHG associated with our operations or purchase carbon offsets or allowances.

There are also ongoing discussions and regulatory initiatives in other countries in which we have production facilities, regarding GHG emission reduction programs. For instance, South Africa has adopted a CO2tax regime.

Water Quality-Our plants are net consumers of water and are generally subject to laws and regulations related to water management. Most of our plants recycle a substantial amount of the water used in the manufacturing process, which is re-used as "quench water" in the cooling process.

Contamination-As we handle chemicals that could cause water or soil contamination, we may be subject to remediation obligations under national laws. Additionally, third parties have in the past and may in the future be able to file claims for personal injury and property damage allegedly caused by the release of hazardous substances or other pollutants into the environment.

In particular, the German Federal Act on Soil Protection requires the prevention of soil contamination by taking adequate precautions. In the United States, our facilities are subject to the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), the Resource Conservation and Recovery Act ("RCRA") and similar state laws. CERCLA establishes liability for parties, including current and former site owners and operators, generators, and transporters, in connection with releases of hazardous substances. Under CERCLA, we may be subject to liability without regard to fault or the lawfulness of the disposal or other activity. RCRA is the principal federal statute regulating the generation, treatment, storage and disposal of hazardous and other wastes. RCRA and state-level hazardous waste regulations impose detailed operating, inspection, training and response standards and requirements for permitting, closure, remediation,

financial responsibility, record keeping and reporting. Our sites have areas currently and formerly used as landfills that are subject to regulation under RCRA, and certain of our facilities have been investigated and remediated under RCRA. These laws and regulations may also expose us to liability for acts that were in compliance with applicable laws at the time we performed those acts. We could incur significant costs in connection with investigation and remediation activities or claims asserted at current or former facilities or third-party sites.

Non-hazardous and Hazardous Waste-In some jurisdictions in which we operate, we are subject to provisions regarding waste management and the handling and storage of hazardous substances. We generate both hazardous and non-hazardous wastes at our facilities that we manage in accordance with applicable laws and regulations. Waste streams generated at our facilities include but are not limited to office trash, carbon black, solvents, refractory materials, catalyst materials, and non-saleable sulfuric acid. Certain facilities have on-site landfills permitted for the disposal of non-hazardous solid waste, but we are not currently using these landfills to dispose of waste. Any waste that is not recycled or reused is managed off site in compliance with local laws and regulations.

Chemical Regulations-Some jurisdictions we operate in have established regimes to regulate or control chemical products to ensure the safe manufacture, use and disposal of chemicals.

In the EU, the Regulation on Registration, Evaluation, Authorization of Chemicals ("REACH") requires chemical manufacturers and importers in the European Union to register all chemicals manufactured in or imported into the EU in quantities of more than one metric ton annually. Registration has to be made with the European Chemicals Agency ("ECHA"), and the use of certain "highly hazardous chemicals" must be authorized by ECHA. Furthermore, REACH contains rules on bringing substances to the market that have been identified as substances of very high concern. In the United States, we are subject to federal and state chemical regulations. Under the Toxic Substances Control Act ("TSCA"), the EPA is required to maintain a list of each chemical substance that is manufactured or processed, including imports. This inventory plays a central role in the regulation of most industrial chemicals in the United States. Carbon black is listed and maintained as an active substance in the TSCA Chemical Substance Inventory, and all our facilities are subject to chemical data reporting rules ("CDR"). Under CDR, we are required to submit basic exposure information to EPA every five years. In California, we are subject to the California Safe Drinking Water and Toxic Enforcement Act, which imposes labeling and record keeping requirements. In South Korea, under its Chemical Control Act, coal-based feedstock oils such as crude coal tar ("CCT"), coal tar distillate ("CTD") and soft pitch oil ("SPO") containing more than 0.1% quinoline are treated as hazardous chemicals requiring production sites to be duly licensed.

We are a member of the International Carbon Black Association (the "ICBA"). The ICBA seeks to address common environmental, health and safety issues, undertakes research on health implications of carbon black, and serves as the leading advocate for the industry in the regulatory and public-interest arenas. The ICBA funds research on international environmental, health, product safety and workplace safety matters concerning carbon black.

We are also a member of the European consortium for carbon black ("CB4REACH Consortium") which has pre-registered and registered carbon black with ECHA as required by the REACH Regulation. Besides the Company, the following companies are members of the CB4REACH Consortium: Cabot Corporation, Cancarb Limited, Birla Carbon, Continental Carbon Company, Tokai Carbon CB Ltd. and Imerys Graphite & Carbon.

In addition, we are a member of the European Chemical Industry Council ("CEFIC"), a European trade association for the EU chemical industry. CEFIC offers services and expertise to its members on regulatory, scientific, and technical matters. It engages, advocates, and represents the industry to create the right support and policy frameworks in the EU and beyond. CEFIC flags new EU legislative initiatives and provides information to its members to timely prepare and mitigate impact on their business and operations.

Health, Safety and Security-The health, safety and security of our employees and customers is one of our highest priorities. We strive to continually improve and attain the top performance on occupational injury and illness rates as compared to the chemical industry. New employees and contractors working and visitors on site are given environmental, health, safety and security ("EHSS") training, and we keep track of EHSS concerns and issues from our employees. Employees are required to report incidents including "near misses" into our electronic EHSS management system. Our sites are required to implement and report EHSS leading and lagging indicators for EHSS performance. Plant managers are required to track and monitor these leading and lagging indicators and take action as appropriate. Leading and lagging indicator data and incidents are reviewed by senior management on a monthly basis.

Product Stewardship-Carbon black is produced under controlled conditions and has high purity levels. It therefore differs from other combustion products that may contain high concentrations of hazardous compounds. Due to its high purity, certain carbon black grades are permitted for use in cosmetics or in products in contact with food.

The International Agency for Research on Cancer ("IARC") classifies carbon black as a Group 2B substance (possible human carcinogen). We have communicated IARC's classification of carbon black to our customers and employees in accordance with applicable regulatory requirements. Based on IARC's classification some regulatory jurisdictions now classify carbon black as a possible carcinogen. The Permanent Senate Commission for the Investigation of Health Hazards of Chemical Compounds in the Work Area (the "MAK Commission") of the German Research Foundation (Deutsche Forschungsgemeinschaft), which uses a different rating system, classifies

carbon black as a suspect carcinogen (Category 3). Any risk reclassification of our raw materials, intermediates or finished product could result in increased operating costs or affect product lines or sales.

The Community Rolling Action Plan ("CoRAP") indicates substances for evaluation by the member states of the EU. The evaluation aims to clarify the initial concern that manufacturing and/or use of shortlisted substances could pose a risk to human health or the environment. With ECHA's update of the CoRAP list in March 2016, carbon black was included in CoRAP for substance evaluation in 2018, though such evaluation has been postponed several times. With ECHA's most recent December 2024 update, the carbon black substance evaluation is proposed to be further delayed to 2027. The substance evaluation for carbon black was proposed by France. The initial reasons of concern raised by the French Agency for Food, Environmental and Occupational Health & Safety ("ANSES") relate to carbon black being an alleged carcinogenic substance and a suspected reproduction toxicant. Orion is working as a member of the CB4REACH Consortium and ICBA to address the reasons for nomination. The conclusion of the evaluation may have significant business impact should ANSES conclude that carbon black poses a risk to human health. A potential outcome could be a harmonized classification and labeling of carbon black for carcinogenicity and toxicity to reproduction. These developments may significantly affect our business, including increasing costs of doing business.

According to the recommendation of October 18, 2011 (EU COM 2011/696/EU), the majority of carbon black grades are defined as a nanomaterial in Europe. This status for carbon black has not changed with the most recent update of the recommendation of June 10, 2022 (2022/C 229/01). The ISO developed the ISO TC 229 "Nanotechnologies," which considers carbon black as a "nano-structured material." Other countries (such as, the U.S., Canada, France, Belgium, Sweden, Switzerland, etc.) have implemented notification schemes related to nanomaterials. In Europe, Commission Regulation (EU) 2018/1881 as of December 3, 2018 amending REACH introduced new information requirements for substances with forms meeting the definition criteria of EU COM 2011/696/EU. The notification of carbon black under the different notification schemes as well as meeting the new nano-related information requirements under REACH requires capital and resource commitments to compile and file dossiers. Furthermore, more and more specific requirements for substances regarded as nanomaterials are emerging within Europe. For example, Germany has introduced a more stringent "Occupational Exposure Limit" for nanomaterials. These developments may significantly affect our business, including increasing costs of doing business.

Further Regulatory Matters

We are subject to further governmental regulation from state, national, EU and other international regulatory authorities concerning, among other things: product safety, export and import control regulations and other customs regulations, data protection, supply chain compliance as well as our competitive and marketplace conduct. We believe that we are in compliance in all material respects with these regulations. We cannot guarantee, however, that any future changes in the requirements or mode of enforcement of these laws and regulations will not have a material adverse effect on our business, financial condition, results of operations or cash flows.

Item 1A. Risk Factors

The following risks may have material adverse effects on our business, financial condition and results of operations. Additional risks and uncertainties of which we are not presently aware or that we currently deem immaterial could also materially affect our business operations and financial condition.

Risks Related to Our Business

Negative or uncertain worldwide economic conditions may result in business volatility and may adversely impact our business, financial condition, results of operations and cash flows.

Our operations and performance are materially connected to worldwide economic conditions. Because carbon black is used in a diverse array of end products, demand for carbon black has historically been related to real gross domestic product ("GDP") and general global economic conditions. In particular, a large part of our sales has direct exposure to the cyclical automotive industry and, to a lesser extent, the construction industry. As a result, certain parts of our business experience a level of cyclicality. The nature of our business and our large fixed asset base make it difficult to rapidly adjust our fixed costs downward when demand for our products declines, which could materially affect our profitability. Global and regional economic downturns have in the past, and may in the future, reduced demand for our products, which have decreased and would decrease our revenue, and could have a material adverse effect on our business, financial condition, results of operations and cash flows. In periods with significant market turmoil or tightened credit availability, we could experience difficulties in accounts receivable collections, pricing pressures and reduced global or local business activity.

Our customers may terminate or attempt to amend their agreements for the purchase of our products due to decline in their demand and production, bankruptcy, lack of liquidity, lack of funding, operational failures, force majeure, hardship or other reasons. The current energy, financial, economic and capital markets environment, and future developments in these and other areas, present material uncertainty and risk with respect to our performance, financial condition, volume of business, results of operations and cash flows.

Our operations in the EU are material to our business and important to our customers. If the competitiveness of manufacturing in the EU continues to decrease in light of factors such as increased environmental compliance costs, inconsistent economic policies and rigid labor practices, our customers may have difficulty maintaining the competitiveness of their operations in this region or lose meaningful market share to lower cost imports from other regions, particularly Asia. For example, a shift in tire production from a higher cost region (such as

the EU) to a lower cost region (such as Asia) could increase the export of tires made in Asia for sales into Europe and could result in a reduction in tire production in the EU and reduce our profitability.

In addition, changes in, or tensions relating to, U.S. or other countries' trade relations with countries where we do business or from which we source necessary supplies may adversely impact our business. The imposition of additional restrictive policies by individual countries could lead to unexpected operating difficulties in countries we operate or do business with. Actual or threatened tariff measures have, and may continue to have, impacts on global markets and foreign exchange rates. Any of these could increase our costs and negatively impact our financial condition, results of operations and cash flows.

Our business is subject to operational risks, which could adversely affect our business, financial condition, results of operations and cash flows.

Our operations are subject to hazards inherent in chemicals manufacturing and the related use, storage, transportation and disposal of feedstocks, products and wastes, including, but not limited to, fires and explosions, accidents, accidental oil or product releases, severe weather and natural disasters (including hurricanes, tornadoes, ice storms, droughts, floods and earthquakes, some of which are significantly increasing in likelihood because of climate change), pandemics (e.g. COVID-19) or epidemics, mechanical failures, unscheduled downtime at our production facilities or at facilities that supply raw materials to us, transportation interruptions, disruption to harbor-, road-, pipeline- or storage tank-access, pipeline, tank and silos leaks and ruptures, quality problems, technical difficulties, energy grid shutdowns, discharges or releases of toxic or hazardous substances or gases, other environmental risks, sabotage, acts of terrorism or other acts of violence as well as potential boycotts, strikes, sanctions or blockades.

Such events have in the past disrupted, and could in the future disrupt, our supply of raw materials or otherwise affect sales, production, transportation and delivery of our products or affect demand for our products. We could incur significant expenditures in connection with such operational risks. These may be caused both by external and internal factors noted above, as well as war, military operations, strikes, official orders, technical interruptions, material defects, accidents or mistakes. In all of these cases, our property, third-party property or the environment may sustain damage, or there may be human exposure to hazardous substances, personal injuries or fatalities. Such events could result in material financial liabilities, civil or criminal law consequences, the temporary or permanent closure or loss of control over the relevant production or administrative sites or power plants and a negative impact on our financial condition, results of operations and cash flows.

We are dependent on major customers for a significant portion of our sales, and a significant adverse change in a customer relationship could negatively affect our business, financial condition, results of operations and cash flows.

Customer concentration is driven by the consolidated nature of the industries we serve. In 2024, our top ten customers accounted for approximately 47% of our volume measured in thousand metric tons ("kmt"). Our success in continuing to strengthen relationships and grow our business with our largest customers and in retaining their business over extended time periods could affect our future results. The loss of any of our major customers (including due to industry consolidation) or a reduction in volume sold to them, could adversely affect our results of operations. Any deterioration in the financial condition of any of our customers or the industries they operate in or serve that impairs our customers' ability to place orders or make payments to us could decrease our sales or increase our uncollectible receivables and could adversely affect our business, financial condition, results of operations and cash flows.

We may not be able to compete successfully in the industries and markets in which we operate.

The industries in which we operate are highly competitive based on price, product innovation, product quality, distribution capability, and industry and customer knowledge. We face competition from global and regional suppliers, both in developed and in emerging regions. While we aim to operate at low cost and are focused on reducing our fixed and variable cost bases across our production chain, there may be improvements in the cost competitiveness of other manufacturers relative to us or in the performance properties of substitutable products and raw materials, which could result in advantages for our competitors that adversely affect our business. Furthermore, some of our competitors may have greater financial and other resources, enhanced access to governmental funding or a larger capitalization than we have. Additionally, our business is sensitive to industry capacity utilization, and pricing tends to fluctuate when capacity utilization changes occur, which could affect our financial performance. If we are unable to respond successfully to changing competitive conditions, the demand for our products could be adversely affected which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

We may not successfully develop new products and technologies that address our customers' changing requirements or competitive challenges, and our customers may substitute our products by using other products we do not offer.

The industries into which we sell our products are subject to periodic technological changes, ongoing product improvements, product substitution and changes in customer requirements. Increased competition from existing or newly developed products offered by our competitors or companies whose products offer a similar or better functionality to our products may negatively affect demand for our products. We work to identify, develop and market innovative products on a timely basis to meet our customers' changing requirements and competitive challenges. Should we not be able to substantially maintain or further develop our product portfolio, customers may elect to source comparable or other products from competitors, which could adversely affect our business, financial condition, results of operations and cash flows.

Although carbon black continues to offer opportunities for product and process innovation, we cannot be certain that the investments we make in our innovations will result in proportional increases in revenue or profits. In addition, the timely commercialization of products that we are developing may be disrupted or delayed by manufacturing or other technical difficulties, industry acceptance or insufficient industry size to support a new product, competitors' new products, or difficulties in moving from the experimental stage to the production stage. These disruptions or delays could adversely affect our business, financial condition, results of operations and cash flows.

As a reinforcing agent in certain rubber applications, carbon black competes primarily with precipitated silica in combination with silane, neither of which are part of our product portfolio. Historically, silica has offered some performance benefits over carbon black in the area of rolling resistance. To date, silica-based tire applications have gained position in passenger car tire treads. Although substitution has not been significant due to carbon black's cost advantage, technological advances and changing customer requirements may lead to increased demand for silica-based tires, especially in developed regions. Increased substitution and competition from precipitated silica producers could adversely affect our business, financial condition, results of operations and cash flows. If we should decide to include precipitated silica in combination with silane in our product portfolio in the future, we may be restricted in our ability to do so under our intellectual property sharing arrangements with Evonik Industries AG ("Evonik") and its affiliates, one of our previous owners.

Alternative materials, procedures or technologies may be developed, or existing ones may be improved and may replace those currently offered in the carbon black industry. If such newly developed or improved products are being offered at lower prices, have preferable features or other advantages, in particular from a regulatory perspective, and we are not able to offer similar new or improved products, we may lose substantial sales volume or customers, which could have an adverse effect on our business, financial condition, results of operations and cash flows.

We may be unable to implement our business strategies in an effective manner.

Our future financial performance and success largely depend on our ability to maintain and improve our current competitive position and to implement our business strategies for growth successfully. We cannot guarantee that we will successfully implement our business strategies or that implementing these strategies will sustain or improve and not harm our results of operations. We may not be able to increase or sustain our manufacturing efficiency or asset utilization, enhance our current portfolio of products or achieve other fixed or variable cost savings. In addition, the costs involved in implementing our strategies may be significantly higher than we currently anticipate. Our ability to complete capacity expansions may be delayed or interrupted by the need to obtain environmental and other regulatory approvals, the availability of labor and materials, unforeseen hazards, such as weather conditions, adverse political or market developments, and other risks associated with construction or expansion projects. Moreover, the cost of expanding capacity could have a negative impact on our financial results until capacity utilization is sufficient to absorb the incremental costs associated with the expansion. Further, labor or governmental restrictions could impede or delay our ability to reduce headcount in the event headcount reduction is deemed to be sensible in our opinion.

Our business strategies are based on our assumptions about future demand for our existing products, the new products and applications we are developing, and on our continuing ability to produce our products profitably. Each of these factors depends on, among other things, our ability to realign our product portfolio, divest businesses on favorable terms and with minimal disruptions, discontinue product lines with minimal disruption, finance our operations and product development activities, negotiate favorable terms, maintain high-quality and efficient manufacturing operations, relocate and close certain manufacturing facilities with minimal disruption to our operations, respond to competitive and regulatory changes, access quality raw materials in a cost-effective and timely manner, and retain and attract highly skilled technical, managerial, marketing and finance personnel. Any failure to develop, revise or implement appropriate business strategies in a timely and effective manner may adversely affect our business, financial condition, results of operations and cash flows.

We are subject to volatility in the costs, quality and availability of raw materials and energy, which could decrease our production volumes and margins and adversely affect our business, financial condition, results of operations and cash flows.

Our manufacturing processes consume significant amounts of raw materials and energy, the costs of which are subject to fluctuations in local and worldwide supply and demand as well as other factors beyond our control. The preponderance of raw material cost used in the production of carbon black is related to petroleum-based or coal-based feedstock known as carbon black oil, with some additional use of other raw materials, such as acetylene, hydrogen and natural gas. We obtain a considerable portion of our raw materials and energy from selected key suppliers. Although we maintain certain raw material reserves, if any of these suppliers is unable to meet its obligations under supply agreements with us on a timely basis or at all, or if we cannot source sufficient supply, we may be forced to incur higher costs to obtain the necessary raw materials and energy elsewhere. Additionally, raw material sourcing and related infrastructure (e.g., harbor access, cargo or ship availability, pipeline, tank, rail, waterway or road-access), may be subject to local developments or regulations in certain jurisdictions where we operate that may reduce, delay or halt the physical supply of raw materials. Our inability to source energy or quality raw materials like carbon black oil, including due to the Russia-Ukraine war, Hamas-Israel conflict and China's relations with the U.S. and with the EU, or otherwise, in a timely fashion and at costs that we anticipate or that are acceptable to us, or an inability to pass-through any cost increases to our customers, could have an adverse impact on our business, financial condition, results of operations and cash flows.

Most of our Rubber Carbon Black supply contracts contain provisions that adjust prices to account for changes in a relevant feedstock price index. However, we are exposed to oil price and gas price fluctuations, and there can be no assurance that we will be able to shift the price risks to our customers. Success in offsetting increased raw material, energy and tax or tariff costs with related price increases is also influenced by competitive and economic conditions, as well as the speed and severity of such changes, and could vary significantly,

depending on the segment served. Such increases may not be accepted by our customers, may not be fully reflected in the indices used in our pricing formulas, may not be sufficient to compensate for increased raw material and energy costs or may decrease demand for our products and our volume of sales. Oil and energy price fluctuations have had, and are likely to continue to have, significant and varying effects on our earnings and results of operations, partly because oil price changes affect our sales prices and our cost of raw materials and energy at different times and amounts, and partly due to other factors, such as differentials affecting the ultimate carbon black oil price paid by us (versus a particular reference price index), carbon black oil usage amounts and ongoing efficiency initiatives, the value of which fluctuates with oil prices. Failure to fully offset the effects of fluctuating raw material or energy costs could have a material adverse effect on our business, financial condition, results of operations and cash flows. Further, volatility in costs and pricing could result in commercial disputes with suppliers and customers regarding the interpretations of complex contractual pricing arrangements, which could adversely affect our business.

Significant movements in the market price for crude oil tend to create volatility in our carbon black feedstock costs, which have in the past affected and may in the future affect our Net Working Capital, cash requirements and operating results. Changes in raw material and energy prices have a direct impact on our Net Working Capital levels. Increases in the cost of raw materials lead to an increase in our Net Working Capital. Due to the quantity of carbon black oil and finished goods that we typically keep in stock together with the levels of receivables and payables maintained, increases occur gradually over a two to three-month period but can vary depending on inventory levels and working capital levels, generally. Net Working Capital swings are particularly significant in an environment of high price volatility.

We may also be subject to volatility in the cost, quality and availability of raw materials and energy due to factors beyond our control, such as geopolitical conflict. See "Negative or uncertain worldwide economic conditions may result in business volatility and may adversely impact our business, financial condition, results of operations and cash flows" and "Our business, financial condition and results of operations could in the future be adversely affected by disruptions in the carbon black oil and natural gas supplies, including disruptions caused by the ongoing war between Russia in Ukraine, the Hamas-Israel conflict and the growing geopolitical tensions between China and Taiwan." This could have an adverse impact on our business, financial condition, results of operations and cash flows.

Any failure to realize benefits from investments, joint ventures, acquisitions or alliances could adversely affect our business, financial condition, results of operations and cash flows.

We have made, and may continue to make, investments and acquisitions and enter into joint ventures and collaborations. The success of acquisitions of existing facilities, new technologies, companies and products, or arrangements with third parties is not always predictable, and we may not achieve our anticipated objectives. Failure to achieve our respective goals could have an adverse impact on our business, financial condition, results of operations and cash flows.

Plant capacity expansions and site development projects may be delayed, cost more than anticipated and/or may not achieve the expected benefits.

Our ability to complete capacity expansions and consolidations as planned, including capacity conversions from Rubber Carbon Black to Specialty Carbon Black and vice versa, and other site development projects, including those associated with yield efficiency improvements or emission controls, may be delayed, interrupted, or otherwise limited by the need to obtain environmental and other regulatory approvals, unexpected cost increases, availability of labor and materials, unforeseen hazards such as weather or health conditions, and other risks associated with construction projects. In addition, lower oil prices may impact our yield efficiency improvements. Moreover, the costs of these activities could have a negative impact on our results of operations and capacity utilization at any particular facility. We may not be able to absorb the incremental costs associated with capacity expansion projects. In addition, our ability to expand capacity depends in part on economic and political conditions in the regions we focus on and, in some cases, on our ability to establish operations, construct additional manufacturing capacity or form strategic business alliances.

We may be subject to information technology systems failures, network disruptions, cybersecurity attacks and breaches of data security.

We rely on information technology systems to manage and operate our production facilities, to process transactions, and to summarize our operating results. Our information technology systems are an important element for effectively operating our business. Information technology systems failures, particularly in connection with running SAP, including risks associated with upgrading or timely updating our systems, network disruptions, misuse, cybercrime and breaches of data security, have occurred in the past, and if they occur in the future, could disrupt our production as well as our operations by impeding our processing of transactions, our ability to protect customer or company information and our financial reporting, and lead to increased costs. It is possible that future technological developments could adversely affect the functionality of our computer systems and require further action and substantial funds to prevent or repair computer malfunctions. Our information technology systems, including our back-up systems, are subject to damage or interruption from power outages, computer and telecommunications failures, computer viruses, cybercrime, internal or external security breaches, catastrophic events such as fires, earthquakes, floods, tornadoes, hurricanes, acts of war or terrorism, and usage errors by our employees or third-party providers. These risks may be exacerbated as we continue to develop our information technology systems, including through the implementation of certain artificial intelligence tools, which tools may also expose us to additional risks. Although we have taken extensive steps to address these concerns by implementing sophisticated network security, back-up systems and internal control measures, there can be no assurance that a system failure or data security breach will not have a material adverse effect on our business, financial condition, results of operations and cash flows. If our information technology systems are damaged or cease to function properly, we may have to make a significant investment to fix or replace them, and we may suffer loss of critical data and interruptions or delays in our production

and operations. Any material disruption in our information technology systems, or delays or difficulties in implementing or integrating new systems or enhancing current systems, could have an adverse effect on our business, financial condition or results of operations. We have experienced non-material cybersecurity attacks in the past and may experience additional cybersecurity attacks in the future, potentially with more frequency or sophistication.

While we continually work to safeguard our systems, train our employees and mitigate potential risks, there is no assurance that such actions will be sufficient to prevent cybersecurity attacks or security breaches that manipulate or improperly use our systems or networks, compromise or lose confidential or otherwise protected information, destroy or corrupt data, or otherwise disrupt our operations and safety tools. The occurrence of such events could negatively impact our reputation and our competitive position and could result in litigation with third parties, regulatory action, loss of business, potential liability and increased remediation costs, any of which could have a material adverse effect on our financial condition and results of operations. In addition, such attacks or breaches could require significant management attention and resources, and result in the diminution of the value of the Company's intellectual property and other assets. A breakdown in existing controls and procedures around the Company's cybersecurity and security prevention environment may prevent us from detecting, reporting or responding to cybersecurity incidents in a timely manner and could have a material adverse effect on our financial condition or the market price of our securities.

In addition to supporting our operations, we use our systems to collect and store confidential and sensitive data, including information about our know-how, technology and business, as well as about our customers and our employees. As our technology continues to evolve, we anticipate that we will collect and store even more data in the future, and that our systems will increasingly use remote cloud-based solutions and communication features that are sensitive to both willful and unintentional security breaches. Much of our value is derived from our confidential business information, including customer data, proprietary technology and trade secrets. To the extent the confidentiality of such information is compromised, we may lose our competitive advantage, and our business, financial condition, results of operations and cash flows may suffer. We also collect, retain and use personal information, including data we gather from customers for product development and marketing purposes, and data we obtain from employees. In the event of a breach in security that allows third parties access to this information, we are subject to a variety of laws on a global basis that require us to provide notification to the data owner, and that may expose us to lawsuits, fines and other means of regulatory enforcement. Our reputation could suffer in the event of such a data breach, which could cause customers to purchase from our competitors. Ultimately, any compromise of our data security could have a material adverse effect on our business, financial condition, results of operations and cash flows.

We are exposed to political or country risk inherent in doing business in some countries.

We operate a global network of production plants located in Europe, the U.S., South Korea, China, South Africa and Brazil. Accordingly, our business is subject to risks related to the different legal, political, social and regulatory requirements and economic conditions of many jurisdictions. Risks inherent in international operations include the following: disruption of supply chains and shipping routes, changes in the rate of economic growth; unsettled political or economic conditions; expropriation or other governmental actions; social unrest, war, terrorist activities or other armed conflict; national and regional labor strikes; confiscatory taxation or other adverse tax policies, trade and or tariff disputes between countries; deprivation of contract rights; trade regulations affecting production, pricing and marketing of products; reduced protection of intellectual property rights; restrictions on the repatriation of income or capital; exchange controls; inflation, deflation, and currency fluctuations and devaluation; the effect of global environmental, health and safety issues; pandemics or epidemics, respective lock-downs, changes to economic conditions, market opportunities and operating restrictions; changes in foreign laws and tax rates; changes in trade sanctions or embargoes that result in losing access to customers and suppliers in those countries; costs associated with compliance with anti-bribery and anti-corruption laws; nationalization of private enterprises by foreign governments; and changes in financial policy, free funds flow and availability of credit or financing sources. These factors could adversely affect our business, financial condition, results of operations and cash flows. Furthermore, there continues to be uncertainty about the future relationship between the U.S. and certain countries, and our reliance upon production in such countries exposes us to risks due to changes in these relationships, including with respect to trade policies, treaties, government regulations and tariffs, among others.

Our business, financial condition and results of operations have in the past and could in the future be adversely affected by disruptions in the carbon black oil and natural gas supplies, including disruptions caused by the ongoing Russia-Ukraine war, Hamas-Israel conflict and the growing geopolitical tension between China and Taiwan.

The impacts of war and other geopolitical events, including but not limited to the war in Ukraine and the Hamas-Israel conflict, the growing geopolitical tensions between China and Taiwan, are difficult to predict. For example, the conflict in Ukraine has previously caused, and may continue to cause, volatility in crude oil and natural gas prices. The responses of countries and political bodies to Russia's actions in Ukraine, the larger overarching tensions, and Ukraine's military defenses and the potential for wider conflict may generally increase energy market volatility, have severe adverse effects on regional and global economic markets and cause volatility in energy and other product prices. The sanctions, shipping disruptions, collateral war damage, and the potential continuation or expansion of the conflict between Russia and Ukraine, or the conflict between Hamas and Israel, could further disrupt the availability of crude oil and natural gas supplies.

The extent or length of any adverse effects of the war in Ukraine or the Hamas-Israel conflict on the supply of oil and natural gas and the quality and availability of carbon black oil is difficult to quantify.

The continuation or escalation of events like the war in Russia-Ukraine war or the Hamas-Israel conflict could decrease our production volumes and margins and may adversely impact our business operations, financial condition and results of operations and are difficult to

predict. The war in Ukraine has caused and may continue to cause curtailed or delayed spending by our customers' customers, particularly in the automotive industry, and increases the risk of customer defaults or delays in payments. The Hamas-Israel conflict or any escalation thereof could adversely impact our margins.

These and other conflicts may also lead to increased physical terrorist or cyberattacks, damage to global supply chains, and have other consequences that impact our business, financial condition and results of operations.

Legal and Regulatory Risks

Our operations are subject to environmental, health and safety laws and regulations. We have been and may in the future be subject to investigations by regulatory authorities in respect of alleged violations and may incur significant costs to maintain compliance with, and to address liabilities under, these laws and regulations and respective litigation and proceedings.

We are subject to extensive supranational, domestic, foreign, federal, state and local laws and regulations governing environmental protection and occupational health and safety, all of which may be subject to change in the future. The raw material procurement, as well as the production and processing of carbon black and its byproducts involve the handling, transportation, manufacture, use and disposal of substances or components that may pose environmental risks or be considered toxic, hazardous or carcinogenic under applicable laws. We are also required to obtain permits or other approvals from various regulatory authorities for our operations, which may be required for matters including air emissions as well as wastewater and storm water discharge, storage, handling and disposal of hazardous substances, remediation of soil, tanks, pipelines or buildings and the operation, maintenance and closure of landfills. If we contaminate the environment, violate or are found to have violated or otherwise fail to comply with laws, regulations or permits or other approvals, or fail to receive the timely renewal of and due application for required permits, we may have to limit production, incur fines and civil or criminal sanctions, be required to undertake significant capital expenditures to achieve compliance, or be subject to other obligations by one or more regulatory authorities. Certain environmental laws and regulations could also impose strict liability, meaning the Company could be forced to assume liability for environmental damage caused by a party other than the Company, even in circumstances where the Company's actions were lawful.

If environmental harm to soil, groundwater, surface water or natural resources is found to have occurred as a result of our current or historical (prior to the existence of the Company) operations, we may be required to incur significant remediation costs at our current or former production facilities, or at third-party sites and for storage facilities. Many of the facilities and third-party storage facilities we utilize have a long history of operation, which might in the future incur environmental compliance and remediation costs due to past spills, contamination, chemical storage, wastewater treatment and waste disposal practices and other activities depending on present and developing laws. For instance, some of our facilities have onsite landfills that have been open for a number of years; we may incur significant costs when these landfills are closed in accordance with applicable laws and regulations. Under certain laws and regulations, the obligations to investigate and remediate contamination at a facility or site may be imposed on current and former owners or operators who disposed of waste on-site. Liability under such laws and regulations may be without regard to fault or to the legality of the activities giving rise to the contamination. As a result, we may incur liabilities for contamination or wastes, including hazardous wastes, generated by our operations and disposed of onsite or at offsite locations, even if we were not responsible at the time the waste was disposed or the contamination occurred. Further, we may also incur additional closure and cleanup costs in connection with the closure of plants or separate feedstock storage sites, including costs relating to decommissioning of equipment, decontamination and clean-up, asbestos removal and relocation or closure of operating equipment such as storage tanks, pipelines, wastewater treatment systems, ponds and landfills.

Our operations inherently create significant hazards when storing carbon black oil, converting carbon black oil to carbon black and packaging and storing of carbon black and shipping the products to our customers. These hazards and risks include fires, explosions, spills, discharges and other releases or exposures, any of which could impact the environment, neighboring community and our employees, which could result in, environmental pollution, personal injury or wrongful death claims, damage to our and neighboring properties and reputational harm. In these cases, authorities could impose fines, and the Company could be required to rectify any damage which occurs in or outside of our fence lines.

Environmental and safety regulations are subject to frequent change, as are the priorities of those who enforce them, and we could incur substantial costs to comply with current or future laws and regulations. The global trend in environmental regulation is to impose increasingly stringent restrictions on activities that may affect the environment. Such regulations have in the past included, and may in the future include, laws and rules designed to reduce emissions of GHG, SO2, NOx, particulate matter and other air pollutants. For instance, the EU has enacted GHG legislation and continues to expand the scope of such legislation. The EPA has promulgated regulations applicable to operations involving GHG above certain thresholds, and the United States and certain states within the United States have enacted, or are considering, limitations on GHG emissions. Any new or amended environmental laws and regulations may result in costly measures for matters subject to regulation, including but not limited to more stringent limits or control requirements for our air emissions; new or increased compliance obligations relating to emission of GHG, SO2, NOx, and particulate matter; any impact our operations could have on the environment or surrounding community; which, in each case, could have a material adverse effect on our operations and financial condition and cash flows. We may be unable to offset these impacts or costs with price increases, productivity improvements, or cost-reduction efforts. Any success we do have in offsetting these impacts or costs will depend on competitive and economic conditions that are inherently variable.

Compliance with future more stringent environmental laws and regulations may result in significantly increased capital expenditures related to prevention and remediation. Our business and financial conditions may be impacted if we are unable to finance these increasing compliance costs. Regardless, we may be required to incur non-capital expenditure costs to satisfy climate change and other environmental obligations imposed on us by the various regulations.

Certain national and international health organizations have classified carbon black as a possible or suspect human carcinogen. To the extent that, in the future, (i) these organizations re-classify carbon black as a known or confirmed carcinogen, (ii) other organizations or government authorities in other jurisdictions classify carbon black or any of our other finished products, raw materials or intermediates as suspected or known carcinogens or (iii) there is discovery of adverse health effects attributable to the production or use of carbon black or any of our other finished products, raw materials or intermediates, we could be required to incur significantly higher costs to comply with environmental, health and safety laws, or to comply with restrictions on sales of our products, our reputation and business could be adversely affected, and we could become the subject of liability, litigation or enforcement actions. In addition, chemicals that are currently classified as harmless may be classified as dangerous in the future, and our products may have characteristics that are not recognized today but may be found in the future to be carcinogenic or otherwise impair human health. See "Item 1. Business, Environmental, Health and Safety Matters."

Environmental, social and governance matters, including regulations requiring a reduction of or that impose additional taxes or fees on greenhouse gas emissions, could adversely affect our business, financial condition, results of operations and cash flows, and an increased awareness as well as adverse publicity about potential impacts on climate change by us or other companies in our industry could harm our reputation.

U.S., EU and international regulators, investors and other stakeholders are increasingly focused on environmental, social and governance (ESG) matters. For example, the changing U.S., EU and international laws, regulations and investor expectations relating to ESG matters, including environmental sustainability and climate change and human capital management, are under consideration or being adopted, which may include specific, target-driven disclosure requirements or expectations. Our response will require increased costs to comply, including the implementation of new reporting processes, entailing additional compliance risk, enhanced workforce skills, and other incremental investments, and our action or inaction in response to these expectations could harm our reputation and relationship with stakeholders.

Given the industry we operate in, regulations requiring a reduction of or that impose additional taxes or fees on greenhouse gas emissions may have a significant impact on our business, financial conditions, results of operations and cash flows as further explained below. Despite our efforts to control, significant volumes of CO2, a GHG, are emitted in our carbon black manufacturing processes. Over the past few decades, the relationship between GHGs and global climate change have resulted in increased levels of scrutiny from regulators, investors and the public alike, and have led to proposed and enacted laws and regulations on both national and supranational levels, to monitor, regulate, control and tax emissions of CO2and other GHGs. These could adversely affect our business, financial condition, results of operations and cash flows. Investors and other financial institutions are also focused on sustainability and climate change as it relates to their investment and financing decisions. Increased awareness in the investment community and any adverse publicity in the global marketplace about potential impacts on climate change by us or other companies in our industry could also harm our reputation.

The international community continues to negotiate a binding treaty that would require reductions in GHG emissions by developed countries. In addition, a number of further measures addressing GHG emissions may be implemented, such as a successor international agreement, if any, to the Kyoto Protocol and the EU's proposal to consider raising its commitment to reduce carbon emissions to at least 55% below 1990 levels by 2030. The United Nations Conference on Climate Change in December 2015 led to the creation of the Paris Agreement and encourages countries to continuously review and improve their GHG emission reduction goals. While signing the Paris Agreement does not legally bind countries to reduce GHG emissions, countries that participate may respond by enacting legislation or regulations in order to progress in lowering GHG emissions. In the United States, Congress has from time to time considered legislation to reduce emissions of GHGs, but no comprehensive legislation has been enacted to date, and significant uncertainty currently exists as to how any such GHG legislation or regulations would impact large stationary sources, such as our facilities in Belpre (Ohio), Borger (Texas), Orange (Texas) or Ivanhoe (Louisiana), and what costs or operational changes these regulations may require in the future. Some U.S. states have taken legal measures to reduce emissions of GHGs, primarily through the development of GHG emission inventories and/or regional or state GHG cap-and-trade programs. South Africa, where we have an operating plant, has adopted a CO2tax regime. There are also ongoing discussions and regulatory initiatives in other countries, including in Brazil where we have production facilities, regarding GHG emission reduction programs, but those programs have not yet been defined. There is no assurance that, in the future, the current level of regulation will continue in the jurisdictions where we operate. In addition, several countries, spanning across Europe, the Middle East, Africa, South America and the Asia-Pacific region, are currently evaluating further and more restrictive regulations to reduce GHG emissions and to implement stricter environmental regulations generally.

Compliance with current or future GHG regulations governing our operations may result in significantly increased capital and operating expenditures for measures such as the installation of more environmentally efficient technology or the purchase of allowances to emit GHGs. We may need to purchase emission rights to cover the shortfall where emissions exceed the quantity of allowances (EU and South Korean ETS), which may cause a material financial impact. Examples of such expenditures may include, but are not limited to, becoming subject to carbon and GHG emission trading requirements under which we may be required to purchase carbon credits and other offsets aimed at reducing our ecological footprint if our emission levels exceed our allocations. Costs of complying with regulations could increase, as concerns related to greenhouse gases and climate change continue to emerge. The enactment of new environmental laws and

regulations and/or the more aggressive interpretation of existing requirements could require us to incur significant costs for compliance or capital improvements or limit our current or planned operations, any of which could have a material adverse effect on our earnings or cash flow. We attempt to offset the effects of these compliance costs through price increases, productivity improvements and cost reduction efforts. Such price increases may not be accepted by our customers, may not be sufficient to compensate for increased regulatory costs or may decrease demand for our products and our volume of sales. While their potential effect on our manufacturing operations or financial results cannot be estimated, they could be substantial. We cannot reliably predict the form that future regulations may take or to estimate any costs that we may be required to incur with respect to these or any other future requirements. In addition to the increased expenditures outlined above, such requirements could also adversely affect our energy supply, or the costs (and types) of raw materials we use, and ultimately may directly or indirectly restrict our operations or reduce demand for our products. The realization of any or all of these consequences could have a material adverse effect on our business, financial condition, results of operations and cash flows. See "Item 1. Business, Environmental, Health and Safety Matters."

Developing regulation of carbon black as a nano-scale material could require us to comply with costly new requirements.

Carbon black consists of aggregates of primary nano-scale particles. The EPA and other governmental agencies have developed regulatory schemes under which they collect further data on nano-scale materials, including carbon black. In addition, the EPA and other nations' environmental regulatory authorities, including the European Commission, are also conducting extensive environmental health and safety investigations of nano-scale materials. If carbon black is found to be harmful to humans and/or to the environment, it could be subject to more stringent regulatory control, which could require us to incur significantly higher costs to comply with new environmental, health and safety laws and could adversely affect our reputation and business. See "Item 1. Business, Environmental, Health and Safety Matters."

In the EU, in 2022 the European Commission finalized the process on the revision of the nanomaterial definition. With its updated recommendation on June 10, 2022 of the definition of nanomaterial (2022/C 220/01), the status for carbon black remains unchanged in comparison to the previous version (2011/696/EU). The majority of carbon black grades are defined as nanomaterials. Furthermore, the International Organization for Standardization ("ISO") developed the ISO TC 229 "Nanotechnologies," which considers carbon black a "nano-structured material." The industry is not yet generally affected by these definitions. However, certain regulations regarding cosmetics applications or articles which are intended for food contact have already implemented nano-specific provisions. Similar nano-specific provisions are also being discussed for other regulations which may additionally affect the use of carbon black in the future. This development may significantly affect our business in a manner we cannot predict, including by increasing the costs of doing business or decreasing the marketability of our products. This could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Our operations have the potential to cause environmental and other damage as well as personal injury.

The operation of a chemical manufacturing business as well as the sale and distribution of chemical products involve safety, health and environmental risks. For example, the production and processing of carbon black and other chemicals involves the storage, handling, transportation, manufacture or use of certain substances or components that may be considered toxic or hazardous. Our manufacturing processes and the storage and transportation of chemical products entail risks such as leaks, fires, explosions, toxic releases or mechanical failures. If operational risks materialize, they could result in injury or loss of life, damage to the environment or damage to property. In addition, the occurrence of material operating problems at our facilities due to any of these hazards may result in loss of production, which in turn, may make it difficult for us to meet customer needs. Accordingly, these hazards and their consequences could have a material adverse effect on our business, financial condition, results of operations and cash flows, both during and after the period of operational difficulties, and could harm our reputation.

The European Union REACH legislation or similar legislation in other countries may affect our ability to manufacture and sell certain products.

The REACH legislation as described under "Chemical Regulation" above or similar legislation in other countries or jurisdictions may limit the ability to market or sell our products, in particular if the relevant authorities may change or amend the registration prerequisites for our products or may narrow their interpretation of such legislation in relation to our products.

Additionally, other organizations and countries, including South Korea and China, have adopted or may in the future adopt comparable or even more restrictive regulations than REACH, which could affect our ability to manufacture and sell certain products in the future.

In certain jurisdictions, carbon black has been added to lists of hazardous products that are subject to labeling and other requirements. Compliance with these requirements is required to sell our products in these jurisdictions, and noncompliance may result in material fines or penalties or other enforcement actions, including injunctions, recalls or seizures, which could have an adverse effect on our business, financial condition, results of operations and cash flows. Changes in the classification of carbon black on these lists or to the applicable regulations could result in more stringent or new requirements and adversely affect our compliance costs. See "Item 1. Business, Environmental, Health and Safety Matters."

Market and regulatory changes may affect our ability to sell or otherwise benefit from co-generated energy, which may adversely affect our business, results of operations and cash flows.

Currently, approximately half of our manufacturing sites, including one jointly owned production facility, have some form of co-generation transforming waste heat from combusting exhaust gas, the main by-product of the carbon black production process, into electricity, steam or hot water. Some of this co-generated energy is self-consumed, and the excess may be sold to third parties. Our ability to benefit from cogeneration, and in particular our ability to sell it to third parties, may be limited due to general market conditions or regulatory changes, which may adversely affect our business, results of operations and cash flows.

Litigation or legal proceedings could expose us to significant liabilities and thus adversely affect our business, financial condition, results of operations and cash flows.

From time to time, we may be involved in various claims and lawsuits arising in the ordinary course of our business. In particular, certain asbestos related claims have been filed with respect to time periods when previous owners were in control of our business. Some matters involve claims for damage payments as well as other relief. Additional claims by (former) employees or contractors based on alleged past exposure to asbestos or other substances with negative health effects may be received in the future.

We may also be subject to litigation based on environmental matters such has pollution, remediation, contamination, or exposure to hazardous substances either in the workplace or resulting from the use of our products. This litigation could result in substantial liability for us, which could have a material adverse effect on our business, financial condition and/or profitability. Certain environmental groups could also initiate litigation against us, which could cause reputational as well as financial harm.

The outcome of legal proceedings is extremely difficult to predict, and we offer no assurances in this regard. Adverse rulings, judgments or settlements in pending or future litigation or administrative proceedings, including employment-related disputes and litigation, contract disputes and litigation, intellectual property disputes and litigation, product liability claims, tort claims and other personal injury claims, claims based on alleged exposure to asbestos, chemicals or to carbon black, environmental permitting disputes or in connection with environmental remediation activities or contamination, could have an adverse effect on our business, financial condition, results of operations and cash flows.

Because many of our products provide critical performance attributes to our customers' applications and products, the sale of these products involves a risk of product liability claims against us, including claims arising in connection with the use of, or exposure to, our products. Our products have widespread end-uses in a variety of consumer industries. A successful product liability claim, or series of claims, arising out of these various uses that results in liabilities in excess of our insurance coverage or for which we are not indemnified by a third party or have not otherwise provided for could have a material adverse effect on our business, financial condition, results of operations and cash flows. In particular, we could be required to increase our debt or divert resources from other investments in our business in order to discharge any such liabilities.

We may not be able to protect our intellectual property rights successfully.

Our intellectual property rights are important to our success and competitive position. We own various patents and other intellectual property rights and have licenses to use intellectual property rights covering some of our products as well as certain processes and product uses. We often choose not to seek to patent a production method or product in order to avoid disclosure of business specific know-how. In addition to patents, a significant part of our intellectual property are our trade secrets, general know-how and experience regarding manufacturing technology, plant operation and quality management, which third parties, including our competitors, may develop independently without violating our trade secret rights. We make careful assessments with respect to production process improvements and decide whether to apply for patents or retain and protect them as trade secrets. In some of the countries in which we operate or sell products, such as China, the laws protecting patent holders are scoped or interpreted differently than in the U.S., the EU or certain other regions. When we file a patent application, it is usually filed for all countries with active competition where we have existing customers. Nonetheless, because the laws and enforcement mechanisms in some countries may not be as effective as in others, and because our intellectual property rights may, if asserted, ultimately be found to be invalid or unenforceable, we may not be able to protect all of our intellectual property rights successfully. Insufficient protection of intellectual property may limit our ability to make use of technological advantages or result in a reduction of future profits. This may cause competitive restrictions and may have an adverse effect on our business, financial condition, results of operations and cash flows.

We may also be subject to claims that our products, processes or product uses infringe or misappropriate the intellectual property rights of others. These claims, even if without merit, can be expensive and time consuming to defend or litigate. If we were to suffer an adverse ruling, we could be subject to injunctions, obligated to pay damages or enter into licensing agreements requiring royalty payments and use restrictions, all of which could adversely affect our business, financial condition, results of operations and cash flows. In addition, licensing agreements may not be available to us, and, if available, may not be available to us on acceptable terms.

In connection with the separation of our business from Evonik, completed on July 29, 2011 (the "Acquisition"), Evonik assigned to us intellectual property that was exclusively used in its carbon black business as well as certain intellectual property rights that are still in use in Evonik's retained business. Also, Evonik retained ownership of certain intellectual property that is not material to us. Evonik has granted us a non-exclusive license to use such retained intellectual property in the field of carbon black. In addition, we have granted back to Evonik licenses relating to some of our intellectual property rights to use such intellectual property in all fields outside the field of carbon

black, which licenses are exclusive, subject to certain exceptions in areas adjacent to carbon black. Accordingly, we may be restricted in leveraging the intellectual property that we use on the basis of a license from Evonik or the intellectual property that is subject to the grant-back licenses to expand our business into certain fields outside of carbon black.

Risks Related to Indebtedness, Currency Exposure and Other Financial Matters

Our financial leverage may make it difficult for us to service that debt and operate our businesses.

We are leveraged with recurring debt service obligations and expect to continue to have leverage for the foreseeable future. We may also incur more debt in the future. This may have negative consequences for our business and investors, including requiring that a substantial portion of the cash flows from our operations be dedicated to debt service obligations; reducing the availability of cash flows to fund internal growth through working capital, capital expenditures, to fund other general corporate purposes, to pay dividends and to finance stock buy-backs; increasing our vulnerability to economic downturns generally or in our industry; exposing us to interest rate increases on our existing indebtedness and indebtedness that we may incur in the future; placing us at a competitive disadvantage compared to our competitors that have less debt in relation to cash flows; limiting our flexibility in planning for or reacting to changes in our business and our industry; restricting us from pursuing strategic acquisitions or exploiting certain business opportunities; and limiting, among other things, our ability to borrow additional funds or raise equity capital in the future and increasing the costs of such additional financings.

If our future cash flows from operations and other capital resources are insufficient to pay our obligations as they mature or to fund our liquidity needs, we may be forced to reduce or delay our business activities and capital expenditures, sell assets, obtain additional debt or equity financing, restructure or refinance all or a portion of our debt on or before maturity or reduce or cease paying our dividend. In the worst-case scenario, an actual or impending inability to pay debts as they become due and payable could result in our insolvency or an insolvency of one or more of our subsidiaries.

Restrictive covenants in our debt instruments may limit our ability to operate our business. Our failure to comply with these covenants, including as a result of events beyond our control, could result in an event of default that may adversely affect our business, financial condition, results of operations and cash flows.

Our current debt instruments impose some operating and financial restrictions on us. These restrictions include limitations on our ability to, among other things, merge or consolidate with other companies; sell, lease, transfer or dispose of assets; pay dividends, redeem stock capital or redeem or reduce subordinated indebtedness; and make acquisitions or investments. Our debt instruments contain covenants that may adversely affect our ability to finance our future operations and capital needs or to pursue available business opportunities. Our ability to comply with these provisions may be affected by changes in economic or business conditions or other events beyond our control. In addition, our debt instruments contain cross-default provisions such that a default under one particular financing arrangement could automatically trigger defaults under other financing arrangements and cause such indebtedness to become due and payable, together with accrued and unpaid interest. As a result, any default under an indebtedness to which we are party could result in a substantial loss to us and could adversely affect our business, financial condition, results of operations and cash flows.

A deterioration in our financial position or a downgrade of our ratings by a credit rating agency could adversely affect our ability to find new financing and maintain existing financing sources, ensure the continued access to receivables factoring programs, increase our borrowing costs, and our business relationships could be adversely affected.

A deterioration of our financial position or a downgrade of our credit ratings for any reason could adversely affect our ability to find new financing and maintain existing financing sources, maintain or expand our receivables programs, increase our borrowing costs and have an adverse effect on our business relationships as well as on the payments and other terms agreeable with customers, suppliers and hedging counterparties. We currently do and may in the future enter into various forms of hedging arrangements against currency exchange, interest rate, raw material and energy and oil price fluctuations. Financial strength and credit ratings are important to the availability and pricing of these hedging activities. As a result, any downgrade of our credit ratings may make it more costly for us to engage in these activities, and changes to our level of indebtedness may make it more difficult or costly for us to engage in these activities in the future.

In addition, a downgrade could adversely affect our existing financing, limit access to the capital or credit markets, or otherwise adversely affect the availability of other new financing on favorable terms, if at all, result in more restrictive covenants in agreements governing the terms of any future indebtedness that we incur, increase our borrowing costs, or otherwise adversely affect our business, financial condition, results of operations and cash flows.

Fluctuations in foreign currency exchange and interest rates could adversely affect our business, financial condition, results of operations and cash flows.

We are exposed to market risks relating to fluctuations in foreign currency exchange and interest rates. Our results of operations have in the past been affected and may in the future be affected by both the transaction and translation effects of foreign currency exchange rate fluctuations. We are exposed to currency fluctuation when we convert currencies that we may receive for our products into currencies required to pay our debt, or into currencies in which we purchase raw materials, meet our fixed costs or pay for services, any of which could result in a gain or loss depending on fluctuations in exchange rates. Fluctuations in currency exchange rates could require us to reduce our prices to remain competitive in foreign markets. In each case, the relevant income or expense is reported in the relevant local currency and is translated into the U.S. dollar at the applicable currency exchange rate for inclusion in our consolidated financial

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Orion SA published this content on May 06, 2025, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 07, 2025 at 07:48 UTC.