Ecovyst, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Reportable Segments (Tables)

Reportable Segments (Tables)

9 Months Ended

Sep. 30, 2024

Summary Financial Information by Reportable Segment

Summarized financial information for the Company’s reportable segments is shown in the following table:


	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023
Sales:
Ecoservices	$	153,867	$	147,629	$	449,428	$	443,433
Advanced Materials & Catalysts(1)	25,308		25,697		73,104		74,877
Total	$	179,175	$	173,326	$	522,532	$	518,310

Adjusted EBITDA:(2)
Ecoservices	$	55,098	$	54,674	$	146,301	$	151,598
Advanced Materials & Catalysts(3)	10,929		16,360		36,775		54,718
Adjusted EBITDA from reportable segments	$	66,027	$	71,034	$	183,076	$	206,316

(1)Excludes the Company’s proportionate share of sales from the Zeolyst Joint Venture accounted for using the equity method (see Note 9 to these condensed consolidated financial statements for further information). The proportionate share of sales excluded is $30,908 and $83,413 for the three and nine months ended September 30, 2024, respectively. The proportionate share of sales excluded is $36,958 and $103,721 for the three and nine months ended September 30, 2023, respectively.

(2)The Company defines Adjusted EBITDA as EBITDA adjusted for certain items as noted in the reconciliation below. Management evaluates the performance of its segments and allocates resources based on several factors, of which the primary measure is Adjusted EBITDA. Adjusted EBITDA should not be considered as an alternative to net income as an indicator of the Company’s operating performance. Adjusted EBITDA as defined by the Company may not be comparable with EBITDA or Adjusted EBITDA as defined by other companies.

(3)The Adjusted EBITDA for the Company’s Advanced Materials & Catalysts segment includes the Company’s 50% portion of the Adjusted EBITDA from the Zeolyst Joint Venture. For the three months ended September 30, 2024, the Adjusted EBITDA from the Zeolyst Joint Venture included in the Advanced Materials & Catalysts segment was $3,281, which includes $922 of equity in net loss plus $610 of amortization of investment in affiliate step-up and $3,593 of joint venture depreciation, amortization and interest. For the nine months ended September 30, 2024, the Adjusted EBITDA from the Zeolyst Joint Venture included in the Advanced Materials & Catalysts segment was $15,767, which includes $2,543 of equity in net income plus $3,151 of amortization of investment in affiliate step-up and $10,073 of joint venture depreciation, amortization and interest.

For the three months ended September 30, 2023, the Adjusted EBITDA from the Zeolyst Joint Venture included in the Advanced Materials & Catalysts segment was $9,640, which includes $4,748 of equity in net income plus $1,601 of amortization of investment in affiliate step-up and $3,291 of joint venture depreciation, amortization and interest. For the nine months ended September 30, 2023, the Adjusted EBITDA from the Zeolyst Joint Venture included in the Advanced Materials & Catalysts segment was $31,270, which includes $16,356 of equity in net income plus $4,802 of amortization of investment in affiliate step-up and $10,112 of joint venture depreciation, amortization and interest.

Reconciliation of Net Income to Segment Adjusted EBITDA

A reconciliation of income before income taxes to Adjusted EBITDA is as follows:


	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023
Reconciliation of income before income taxes to Adjusted EBITDA from reportable segments
Income before income taxes	$	18,748	$	24,465	$	32,523	$	58,850
Interest expense, net	11,305		11,811		37,609		30,812
Depreciation and amortization	23,227		21,290		66,784		62,456
Unallocated corporate expenses	6,224		3,163		20,836		16,243
Joint venture depreciation, amortization and interest	3,593		3,292		10,073		10,112
Amortization of investment in affiliate step-up	610		1,601		3,151		4,802
Debt extinguishment costs	—		—		4,560		—
Net loss on asset disposals	218		1,020		832		3,326
Foreign exchange (gain) loss	(1)		774		78		(362)
LIFO (benefit) expense	(552)		—		(3,223)		2,510
Transaction and other related costs	—		187		198		2,811
Equity-based compensation	2,952		3,477		10,460		12,547
Restructuring, integration and business optimization expenses	535		310		920		2,438
Other	(832)		(356)		(1,725)		(229)
Adjusted EBITDA from reportable segments	$	66,027	$	71,034	$	183,076	$	206,316

Schedule of Segment Reporting Information, by Segment

Capital expenditures for the Company’s reportable segments are shown in the following table:


	Nine months ended September 30,
	2024		2023
Capital expenditures:
Ecoservices	$	42,107	$	44,033
Advanced Materials & Catalysts(1)	7,824		3,631
Corporate(2)	1,794		5,978
Capital expenditures per the condensed consolidated statements of cash flows	$	51,725	$	53,642

(1) Excludes the Company’s proportionate share of capital expenditures from the Zeolyst Joint Venture.

(2) Includes corporate capital expenditures, the cash impact from changes in capital expenditures in accounts payable and capitalized interest.