Orion S.A. Reports First Quarter Earnings; Increases Full Year 2026 Adjusted EBITDA Outlook
OEC
Published on 05/06/2026 at 04:31 pm EDT
Orion S.A. (NYSE: OEC), a specialty chemical company, today reported First Quarter 2026 Net sales of $460 million, a 4% decrease from the prior year, consisting of a 11% reduction in price, predominantly from the pass-through effect of lower year-over-year oil prices, and 1% adverse mix, which was partly offset by 2% higher volumes and 6% favorable foreign currency translation. Our first quarter results improved as the quarter progressed, despite a slow start in January and February which our Rubber segment’s customers attributed to winter weather conditions. Demand picked up considerably during the month of March across both segments, particularly in our Specialty business.
For the quarter, Orion generated a consolidated Net loss of $10 million, and Adjusted EBITDA of $46 million. Working capital utilization is typically the highest in our first quarter, resulting in an Operating cash use of $12 million and free cash outflow of $48 million. Orion responded quickly to the March surge in energy prices by accelerating cost actions and further optimizing working capital, while implementing targeted price increases and surcharges to protect margins in non-formula pass-through business.
Other Highlights
“We are pleased with our first quarter results, including Adjusted EBITDA of $46 million which was ahead of internal expectations. This was despite Rubber segment volumes which reflected continued sluggish Western Hemisphere tire build rates to start the year. The dynamic backdrop resulting from the Middle East conflict is a test of Orion’s agility, and I am proud of our team’s responsiveness – executing price increases and surcharges, flexing our supply chain to meet higher demand, and judiciously managing inventories,” stated Corning Painter, Chief Executive Officer.
“Despite uncertainties associated with the conflict, including its impact on energy prices and the global economy, our business’s resilience and asset footprint have enabled us to support customers during these dynamic times,” continued Painter. “Orion’s products are essential, we are competitively positioned, and our customer relationships are enduring. Our healthy order book underscores the value of Orion’s local supply network.”
“In addition to normal first quarter seasonality, we experienced incremental working capital headwinds during the month of March due to higher crude oil prices,” added Jon Puckett, Chief Financial Officer. “Contrary to the upward bias in EBITDA, working capital is pressured during periods of higher oil prices. Oil price volatility affects the timing of cash conversion but does not alter the long-term cash generation fundamentals of the business. Accordingly, we are amplifying efforts to mitigate the effects on working capital. Generating positive cash flow remains our number one financial priority,” continued Puckett.
First Quarter 2026 Overview:
Three Months Ended March 31,
(In millions, except per share data or stated otherwise)
2026
2025
Volume (kmt)
Specialty Carbon Black
64.0
61.9
Rubber Carbon Black
192.5
189.8
Total
256.5
251.7
Net Sales
Specialty Carbon Black
169.7
160.7
Rubber Carbon Black
289.8
317.0
Total
459.5
477.7
Income from operations
Specialty Carbon Black
12.8
14.4
Rubber Carbon Black
(1.6)
17.4
Corporate
(0.8)
(0.6)
Total
11.4
31.2
Net income (loss)
(9.9)
9.1
Adjusted Net income (loss)(1)
(6.1)
12.8
Segment Measures—Adjusted EBITDA(1)
Specialty Carbon Black
27.1
25.4
Rubber Carbon Black
19.0
40.8
Total
46.1
66.2
Basic Earnings (loss) per share
(0.18)
0.16
Diluted Earnings (loss) per share
(0.18)
0.16
Adjusted Diluted Earnings (loss) per share(1)
(0.11)
0.22
(1)
The reconciliations of these non-GAAP measures to the respective most comparable GAAP measures are provided in the section titled Reconciliation of Non-GAAP Financial Measures.
Specialty Carbon Black
Specialty segment demand picked up considerably late in the first quarter, as supply chain uncertainty precipitated higher demand across most end-markets. Segment volumes increased 3% year over year, led by growth in the Americas, along with Europe, Middle East and Africa (“EMEA”) more than offsetting slightly lower year-over-year demand in Asia Pacific (“APAC”). Net sales increased by $9 million, or 6%, year over year to $170 million, primarily due to higher volume, positive mix, and favorable foreign currency exchange impacts, more than offsetting unfavorable price, predominantly the pass-through effect of lower year-over-year oil prices. Segment Adjusted EBITDA increased 7%, driven primarily by higher volumes, positive product mix and favorable foreign currency impact, partially offset by lower fixed cost absorption related to an inventory draw.
Rubber Carbon Black
Rubber segment results were consistent with expectations, affected by calendar 2026 pricing agreements, as well as soft demand conditions in North America. Tire build rates were down in North America because of sluggish channel sell-through early in the year, partly related to adverse winter weather, in addition to lingering tire channel inventories resulting from the 2025 increase in low-value tire imports. Volume increased 1% year over year during the quarter, primarily due to higher demand in EMEA and APAC. Net sales decreased by 9% year over year on lower pricing, predominantly the pass-through effect of lower year-over-year oil prices, and adverse regional mix, only partly offset by higher volumes and favorable foreign currency translation. The segment’s Adjusted EBITDA decrease was driven primarily by the pricing outcome of calendar 2026 supply agreements, adverse impact from the pass-through effect of lower year-over-year raw material costs, and unfavorable regional mix, partially offset by higher volumes and favorable foreign currency translation.
Cash Flow and Balance Sheet
First Quarter 2026 operating cash use was $12 million on the seasonal working capital impacts of $54 million. After $36 million of capital expenditures, first quarter free cash outflow was $48 million. We finished the quarter with net debt of $965 million, and a net debt-to-Adjusted EBITDA ratio of 4.2x.
Outlook
"The earnings resilience of our business is enhanced during periods of higher oil prices. This characteristic, coupled with our strong order trends, gives us confidence to increase our 2026 Adjusted EBITDA guidance range, which is now $170 to $210 million, up from $160 to $200 million. We do contemplate some moderation in both oil prices and demand in the second half of 2026,” Painter concluded.
Conference Call
As previously announced, Orion will hold a conference call tomorrow, Thursday, May 7, 2026, at 8:30 a.m. (ET). The dial-in details for the live conference call are as follows:
U.S. Toll Free:
1-877-407-4018
International:
1-201-689-8471
A replay of the conference call may be accessed by phone at the following numbers Thursday, May 21, 2026:
U.S. Toll Free:
1-844-512-2921
International:
1-412-317-6671
Conference ID:
13758999
Additionally, an archived webcast of the conference call will be available on the Investor Relations section of the company’s website at www.orioncarbons.com.
To learn more about Orion, visit the company’s website at www.orioncarbons.com, where we regularly post information including notification of events, news, financial performance, investor presentations and webcasts, non-GAAP reconciliations, SEC filings and other information regarding our company, its businesses and the markets it serves.
About Orion S.A.
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 specialties, 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 14 plants worldwide, offering the most diverse variety of production processes in the industry. 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. For more information, please visit orioncarbons.com.
Cautionary Statement for the Purposes of the “Safe Harbor” Provisions of the Private Securities Litigation Reform Act of 1995
This document contains and refers to certain forward-looking statements with respect to our financial condition, results of operations and business, including those in the “Outlook” section above. These statements constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and 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. You should not place undue reliance on forward-looking 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,” “guidance,” “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:
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:
Factors that could cause our actual results to differ materially from those expressed or implied in such forward-looking statements include those factors detailed under the captions “Cautionary Statement for Purposes of the “Safe Harbor” Provisions of the Private Securities Litigation Reform Act of 1995” and “Risk Factors” in our Annual Report in Form 10-K for the year ended December 31, 2025 and Note Q. Commitments and Contingencies to our audited Consolidated Financial Statements included therein regarding contingent liabilities, including litigation, as well as in our latest Quarterly Reports on Form 10-Q and our other filings and submissions on Form 8-K with the Securities and Exchange Commission. 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. We undertake no obligation to publicly update or revise any forward-looking statement - including those in the “Outlook” and “Quarterly Business Segment Results” sections above - as a result of new information, future events or other information, other than as required by applicable law.
Reconciliation of Non-GAAP Financial Measures
We present certain financial measures that are not prepared in accordance with GAAP or the accounting standards of any other jurisdiction and may not be comparable to other similarly titled measures of other companies. For a reconciliation of these non-GAAP financial measures to their nearest comparable GAAP measures, see section “Reconciliation of Non-GAAP Financial Measures” below.
These non-GAAP measures include, but are not limited to EBITDA, Adjusted EBITDA, Free cash flow and adjusted earnings per share as well as Net income (loss) (“Adjusted Diluted EPS”).
We define Adjusted EBITDA as Income from operations before depreciation and amortization, stock-based compensation, and non-recurring items (such as, restructuring expenses, Goodwill impairment, Loss (recovery) due to misappropriation of assets, net, etc.) plus Earnings in affiliated companies, net of tax. We define Free cash flow as Net cash provided by operating activities less Net cash used in investing activities. We define Net Debt as Total Gross debt less Cash and cash equivalents. We define Net Leverage Ratio as Net Debt divided by trailing twelve months Adjusted EBITDA.
We define Adjusted earnings per share (EPS) as earnings, adjusted for stock-based compensation, non-recurring items (such as, restructuring expenses, Goodwill impairment, Loss (recovery) due to misappropriation of assets, net, etc.), intangible assets amortization, foreign exchange rate impacts and an estimated tax effect on add back items, divided by Weighted average number of diluted ordinary shares.
Our operations are managed by senior executives who report to our Chief Executive Officer (“CEO”), the chief operating decision maker (“CODM”). Adjusted EBITDA is used by our CODM to evaluate our operating performance and to make decisions regarding allocation of capital, because it excludes the effects of items that have less bearing on the performance of our underlying core business. We use this measure, together with other measures of performance under GAAP, to compare the relative performance of operations in planning, budgeting and reviewing our business. By eliminating potential differences in results of operations between periods caused by factors such as depreciation and amortization, historic cost and age of assets, financing and capital structures and taxation positions or regimes, we believe that Adjusted EBITDA provides a useful additional basis for evaluating and comparing the current performance of the underlying operations.
We believe our non-GAAP measures are useful measures of financial performance in addition to Net income, Income from operations and other profitability measures under GAAP, because they facilitate operating performance comparisons from period to period. In addition, we believe these non-GAAP measures aid investors by providing additional insight into our operational performance and help clarify trends affecting our business.
Other companies and analysts may calculate non-GAAP financial measures differently, so making comparisons among companies on this basis should be done carefully. Non-GAAP measures are not performance measures under GAAP and should not be considered in isolation or construed as substitutes for Net sales, Net income, Income from operations, Gross profit and other GAAP measures as an indicator of our operations in accordance with GAAP.
With respect to Adjusted EBITDA and Free cash flow outlook for 2026, we are not able to reconcile the forward-looking non-GAAP financial measures to the closest corresponding GAAP measure without unreasonable efforts because we are unable to predict the ultimate outcome of certain significant items. These items include, but are not limited to, significant legal settlements, tax and regulatory reserve changes, restructuring costs and acquisition and financing related impacts.
Consolidated Statements of Operations
Three Months Ended March 31,
(In millions, except per share amounts)
2026
2025
Unaudited
Net sales
$
459.5
$
477.7
Cost of sales
380.3
379.6
Gross profit
79.2
98.1
Selling, general and administrative expenses
59.1
58.4
Research and development costs
7.3
6.6
Other expense (income), net
1.4
1.9
Income from operations
11.4
31.2
Interest and other financial expense, net
14.7
13.7
Income (loss) before earnings in affiliated companies and income taxes
(3.3
)
17.5
Income tax expense (benefit)
6.7
8.9
Earnings in affiliated companies, net of tax
0.1
0.5
Net income (loss)
$
(9.9
)
$
9.1
Weighted-average shares outstanding (in thousands):
Basic
56,375
57,058
Diluted
56,375
57,200
Earnings (loss) per share
Basic
$
(0.18
)
$
0.16
Diluted
$
(0.18
)
$
0.16
Consolidated Statements of Financial Position
(In millions, except share amounts)
March 31, 2026
December 31, 2025
ASSETS
Current assets
Cash and cash equivalents
$
50.5
$
60.7
Accounts receivable, net
270.5
213.6
Inventories, net
251.0
277.3
Income tax receivables
17.3
25.3
Prepaid expenses and other current assets
72.2
66.9
Total current assets
661.5
643.8
Property, plant and equipment, net
1,062.1
1,069.6
Right-of-use assets
124.7
125.8
Intangible assets, net
11.9
14.2
Investment in equity method affiliates
13.6
13.1
Deferred income tax assets
28.3
20.5
Other assets
28.6
20.6
Total non-current assets
1,269.2
1,263.8
Total assets
$
1,930.7
$
1,907.6
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable
$
168.0
$
197.0
Current portion of long term-debt and other financial liabilities
351.2
305.0
Accrued liabilities
63.2
50.1
Income taxes payable
12.7
20.2
Other current liabilities
64.6
54.1
Total current liabilities
659.7
626.4
Long-term debt, net
662.5
674.5
Employee benefit plan obligation
57.4
58.4
Deferred income tax liabilities
38.4
28.0
Other liabilities
133.2
135.7
Total non-current liabilities
891.5
896.6
Stockholders' equity
Common stock
Authorized: 65,992,259 and 65,992,259 shares with no par value
Issued – 60,992,259 and 60,992,259 shares with no par value
Outstanding – 56,388,649 and 56,154,794 shares
85.3
85.3
Treasury stock, at cost, 4,603,610 and 4,603,610
(80.6
)
(90.8
)
Additional paid-in capital
70.8
80.2
Retained earnings
371.1
382.2
Accumulated other comprehensive loss
(67.1
)
(72.3
)
Total stockholders' equity
379.5
384.6
Total liabilities and stockholders' equity
$
1,930.7
$
1,907.6
Consolidated Statements of Cash Flows
Three Months Ended March 31,
(In millions)
2026
2025
Cash flows from operating activities:
Net income (loss)
$
(9.9
)
$
9.1
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation of property, plant and equipment and amortization of intangible assets and right of use assets
32.7
31.5
Amortization of debt issuance costs
1.2
0.4
Stock based compensation
1.4
2.7
Deferred tax (benefit) provision
2.2
(5.4
)
Foreign currency transactions
2.4
(2.0
)
Changes in operating assets and liabilities, net:
Trade receivables
(60.2
)
(56.7
)
Inventories
21.9
1.2
Trade payables
(15.2
)
17.2
Other provisions
14.4
(5.2
)
Income tax liabilities
(2.1
)
3.6
Other assets and liabilities, net
(1.2
)
4.0
Net cash provided by operating activities
(12.4
)
0.4
Cash flows from investing activities:
Acquisition of property, plant and equipment
(36.1
)
(29.2
)
Net cash used in investing activities
(36.1
)
(29.2
)
Cash flows from financing activities:
Repayments of long-term debt
(7.6
)
(0.8
)
Payments for debt issue costs
(4.7
)
—
Cash inflows related to current financial liabilities
76.1
56.2
Cash outflows related to current financial liabilities
(22.2
)
(12.6
)
Dividends paid to stockholders
(1.2
)
(1.2
)
Repurchases of Common stock
(0.8
)
(19.8
)
Net cash provided by (used in) financing activities
39.6
21.8
Increase (decrease) in cash, cash equivalents and restricted cash
(8.9
)
(7.0
)
Cash, cash equivalents and restricted cash at the beginning of the period
61.2
44.6
Effect of exchange rate changes on cash
(0.3
)
1.4
Cash, cash equivalents and restricted cash at the end of the period
52.0
39.0
Less restricted cash at the end of the period
1.5
1.5
Cash and cash equivalents at the end of the period
$
50.5
$
37.5
Reconciliation of Non-GAAP to GAAP Financial Measures
The following tables present a reconciliation of each Non-GAAP measure to the most directly comparable GAAP measure:
Reconciliation of Net income (loss) to Adjusted EBITDA:
Reconciliation of profit
First Quarter
(In millions)
2026
2025
Net income (loss)
$
(9.9
)
9.1
Add back Income tax expense
6.7
8.9
Add back Equity in earnings of affiliated companies, net of tax
(0.1
)
(0.5
)
Income (loss) before earnings in affiliated companies and income taxes
(3.3
)
17.5
Add back Interest and other financial expense, net
14.7
13.7
Income from operations
11.4
31.2
Add back Depreciation of property, plant and equipment and amortization of intangible assets and right of use assets
32.7
31.5
EBITDA
44.1
62.7
Equity in earnings of affiliated companies, net of tax
0.1
0.5
Long term incentive plan
1.4
2.7
Other adjustments
0.5
0.3
Adjusted EBITDA
$
46.1
$
66.2
Adjusted EPS
First Quarter
(In millions, except per share amounts)
2026
2025
Net income (loss)
$
(9.9
)
$
9.1
add back long term incentive plan
1.4
2.7
add back other adjustment items
0.5
0.3
add back intangible assets amortization
2.0
1.8
add back foreign exchange rate impacts
0.4
0.1
add back amortization of transaction costs
1.2
0.4
Tax effect on add back items at estimated tax rate
(1.7
)
(1.6
)
Adjusted Net income (loss)
$
(6.1
)
$
12.8
Total add back items
$
3.8
$
3.7
Impact add back items per share
$
0.07
$
0.06
Earnings (loss) per share (diluted)
$
(0.18
)
$
0.16
Adjusted diluted Earnings (loss) per share
$
(0.11
)
$
0.22
Reconciliation of Net cash provided by operating activities to Free Cash flow:
Free cash flow
Three Months Ended March 31,
(In millions)
2026
2025
1
Net cash provided by operating activities
(12.4
)
0.4
2
Net cash used in investing activities
(36.1
)
(29.2
)
1 + 2
Free cash flow
(48.5
)
(28.8
)
Reconciliation of Debt to Net Leverage Ratio:
Net Leverage Ratio
March 31
December 31
(In millions, except ratio)
2026
2025
Term Loans (non-current)
$
624.0
$
636.7
China Term Loan (non-current)
39.8
39.3
Other short-term debt and obligations
337.9
289.8
Term Loans (current)
0.8
3.0
China Term Loan (current)
13.3
13.1
Total gross debt
1,015.8
981.9
Less: Cash and cash equivalents
50.5
60.7
1
Net Debt
$
965.3
$
921.2
2
Adjusted EBITDA (Trailing twelve months)
$
227.9
$
248.0
1 ÷ 2
Net Leverage Ratio
4.2
3.7
Adjusted EBITDA (Trailing twelve months)
(In millions, except ratio)
Adjusted EBIDTA Trailing twelve months as of December 31, 2025
$
248.0
Less: Adjusted EBIDTA as of March 31, 2025
66.2
Add: Adjusted EBIDTA as of March 31, 2026
46.1
Adjusted EBITDA (Trailing twelve months)
$
227.9
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