Olin Corporation (NYSE:OLN) Q3 2024 Earnings Conference Call October 25, 2024 9:00 AM ET

Company Participants

Steve Keenan - Director of IR
Ken Lane - President and CEO
Todd Slater - CFO

Conference Call Participants

Duffy Fischer - Goldman Sachs
Hassan Ahmed - Alembic Global
Arun Viswanathan - RBC Capital Markets
Jeff Zekauskas - JP Morgan
Aleksey Yefremov - KeyBanc
Josh Spector - UBS
Patrick Cunningham - Citi
Kevin McCarthy - Vertical Research
Steve Byrne - Bank of America
Mike Leithead - Barclays
Bhavesh Lodaya - BMO Capital Markets
John Roberts - Mizuho
David Begleiter - Deutsche Bank
Mike Sison - Wells Fargo
Frank Mitsch - Fermium Research

Operator

Good morning. And welcome to Olin Corporation's Third Quarter 2024 Earnings Conference Call. All participants will be in listen-only mode [Operator Instructions]. Please note this event is being recorded. I would now like to turn the conference over to Steve Keenan, Olin's Director of Investor Relations. Please go ahead, Steve.

Steve Keenan

Thank you, operator. Good morning, everyone. And we appreciate you joining us today to review Olin's third quarter results. Before we begin, I'll remind you that this discussion, together with the associated slides and question-and-answer session that follows, will include statements regarding estimates or expectations of future performance. Please note these are forward-looking statements and that Olin's actual results could differ materially from those projected. Some of the factors that could cause actual results to differ from our projections are described without limitations in the Risk Factors section of our most recent Form 10-K and in yesterday's third quarter earnings press release. A copy of today's transcript and slides will be available on our Web site in the Investors section under Past Events. Our earnings press release and other financial data and information are available under press releases. With me this morning are Ken Lane, Olin's President and CEO; and Todd Slater, Olin's CFO. We'll start with our prepared remarks, then we look forward to taking your questions. I'll now turn the call over to Ken Lane.

Ken Lane

Thanks, Steve. And good morning, everyone. Olin's third quarter was significantly impacted by operational disruptions as a result of hurricane Beryl damage. I want to thank our team at the Freeport site for their efforts to restart our assets, which were shut down in early July due to the hurricane. Multiple plants are now returning to normal operations. The Olin team worked through the difficult time safely and expeditiously while facing hurricane related challenges at home and in their communities. Now turning to our third quarter results on Slide 3. The quarter unfolded slightly better than expected for our chemicals businesses, excluding the impact of Hurricane Beryl, which came in at $110 million versus our initial estimate of $100 million during the quarter. We will have some residual hurricane impact in the fourth quarter due to additional downtime and the completion of some less critical infrastructure repairs. Excluding the impacts from Hurricane Beryl, chlor alkali products achieved a solid quarter with sequential improvement. The aftermath of recent hurricanes also drove third quarter demand for bleach and hydrochloric acid higher in support of water treatment and cleaning end uses. During the third quarter, caustic prices increased supported by some demand improvement in export markets as well as continued constraints in supply related to global industry planned and unplanned outages. Epoxy prices and margins continue to slowly improve, though volumes remain weak. We remain focused on delivering cost reductions during a very challenging market environment. Our third quarter epoxy resin volumes were sequentially lower as we started our planned start at Germany turnaround. Third quarter Winchester commercial ammunition volume fell significantly short of our expectations. Due to softness in consumer demand at our customers' retail outlets, retailers are now slowing their purchases to normalize inventories by year end. This headwind is partially offset by continued strength in defense demand.