What changed in this filing

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Item 1. Financial Statements

2025-07-30 compared with 2025-05-01 · 252 added, 189 removed, 676 unchanged (39% of the section changed)

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Three months ended

Six months ended

Nine months ended

(In millions except per share data - unaudited)

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Equity and other income

Income (loss) on acquisitions and divestitures, net - Note B

Operating income (loss)

Goodwill impairment - Note G

Loss on acquisitions and divestitures, net - Note B

Operating loss

Net interest and other expense (income)

Other net periodic benefit loss - Note K

Income (loss) from continuing operations before income taxes

Loss from continuing operations before income taxes

Income tax expense (benefit) - Note J

Income (loss) from continuing operations

Income (loss) from discontinued operations, net of income taxes - Note C

Loss from discontinued operations, net of income taxes - Note C

Net income (loss)

PER SHARE DATA

Basic earnings per share - Note M

Basic earnings (loss) per share - Note M

Income (loss) from continuing operations

Income (loss) from discontinued operations

Loss from discontinued operations

Net income (loss)

Diluted earnings per share - Note M

Diluted earnings (loss) per share - Note M

Income (loss) from continuing operations

Income (loss) from discontinued operations

Loss from discontinued operations

Net income (loss)

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Unrealized translation gain (loss)

Unrealized gain on commodity hedges

Unrealized gain (loss) on commodity hedges

Other comprehensive income (loss) - Note N

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Current liabilities

Short-term debt - Note H

Trade and other payables

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Total liabilities and stockholders' equity

(a) Accounts receivable, net includes an allowance for credit losses of $ 2 million at both March 31, 2025 and September 30, 2024 .

(b) Asbestos insurance receivable, net includes an allowance for credit losses of $ 2 million at both March 31, 2025 and September 30, 2024 .

(a) Accounts receivable, net includes an allowance for credit losses of $ 2 million at both June 30, 2025 and September 30, 2024 .

(b) Asbestos insurance receivable, net includes an allowance for credit losses of $ 2 million at both June 30, 2025 and September 30, 2024 .

SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.

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STATEMENTS OF CONDENSED CONSOLIDATED CASH FLOWS

Six months ended

Nine months ended

(In millions - unaudited)

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Net income (loss)

Loss (income) from discontinued operations, net of income taxes

Loss from discontinued operations, net of income taxes

Adjustments to reconcile income (loss) from continuing operations to cash flows from operating activities:

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Stock based compensation expense

Loss (income) from restricted investments

Income on divestitures, net

Impairment charges

Income from restricted investments

Loss (income) on divestitures, net

Goodwill impairment

Pension contributions

1 unchanged sentence

Change in operating assets and liabilities

Total cash flows provided (used) by operating activities from continuing operations

Total cash flows provided by operating activities from continuing operations

CASH FLOWS PROVIDED (USED) BY INVESTING ACTIVITIES FROM CONTINUING OPERATIONS

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Proceeds from sale of operations

Proceeds from settlement of Company-owned life insurance contracts

Company-owned life insurance payments

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Other investing cash flows

Total cash flows used by investing activities from continuing operations

CASH FLOWS PROVIDED (USED) BY FINANCING ACTIVITIES FROM CONTINUING OPERATIONS

Total cash flows provided (used) by investing activities from continuing operations

CASH FLOWS USED BY FINANCING ACTIVITIES FROM CONTINUING OPERATIONS

Repurchase of common stock

Proceeds from (repayment of) short-term debt

Repayment of short-term debt

Cash dividends paid

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Effect of currency exchange rate changes on cash and cash equivalents

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

DECREASE IN CASH AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD

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and consolidated subsidiaries ("Ashland" or the "Company") Annual Report on Form 10-K for the fiscal year ended September 30, 2024, filed with the SEC on November 18, 2024.

Results of operations for the period ended March 31, 2025, are not necessarily indicative of the expected results for the remainder of the fiscal year.

Results of operations for the period ended June 30, 2025, are not necessarily indicative of the expected results for the remainder of the fiscal year.

Ashland is comprised of the following reportable segments:

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Ashland determined this transaction did not qualify for discontinued operations treatment since it neither represented a strategic shift nor did it have a major effect on Ashland's operations and financial results.

Ashland recorded an impairment charge of zero for the three months ended March 31, 2025 and $ 183 million ($ 1 million allocated to goodwill, $ 134 million to other intangible assets, $ 33 million to property, plant and equipment, $ 14 million to operating lease assets, net and $ 1 million to other current assets) for the six months ended March 31, 2025, within the income (loss) on acquisitions and divestitures, net caption of the Statements of Condensed Consolidated Comprehensive Income (Loss).

The tax benefit associated with the sale is included within the income tax expense (benefit) caption of the Statements of Condensed Consolidated Comprehensive Income (Loss) for the three and six months ended March 31, 2025 .

See Note J of the Notes to the Condensed Consolidated Financial Statements for additional details.

Ashland also recorded a pre-tax gain on sale of $ 8 million following the completion of this sale, mainly related to working capital movements, within the income (loss) on acquisitions and divestitures, net caption of the Statements of Condensed Consolidated Comprehensive Income (Loss) for the three and six months ended March 31, 2025.

Ashland recorded an impairment charge of $ 183 million ($ 1 million allocated to goodwill, $ 134 million to other intangible assets, $ 33 million to property, plant and equipment, $ 14 million to operating lease assets, net and $ 1 million to other current assets) for the nine months ended June 30, 2025, within the loss on acquisitions and divestitures, net caption of the Statement of Condensed Consolidated Comprehensive Income (Loss).

The tax benefit associated with the sale is included within the income tax expense (benefit) caption of the Statement of Condensed Consolidated Comprehensive Income (Loss) for the nine months ended June 30, 2025 .

See Note J of the Notes to the Condensed Consolidated Financial Statements for tax details associated with the transaction.

Ashland also recorded a pre-tax gain on sale of $ 8 million following the completion of this sale, mainly related to working capital movements, within the loss on acquisitions and divestitures, net caption of the Statement of Condensed Consolidated Comprehensive Income (Loss) for the nine months ended June 30, 2025.

Nutraceuticals business sale

In May 2024, Ashland signed a definitive agreement to sell substantially all of the net assets of its Nutraceuticals business to Turnspire Capital Partners LLC.

The Nutraceuticals business was included within Ashland's Life Sciences reportable segment.

The transaction was completed during Ashland's fiscal year ended September 30, 2024.

Ashland recorded a $ 99 million impairment charge within the loss on acquisitions and divestitures, net caption of the Statements of Consolidated Comprehensive Income (Loss) for the three and nine months ended June 30, 2024.

The impairment charge included the impact of the related inside tax basis differences associated with the impaired assets.

The tax benefit associated with the sale was included within the income tax expense (benefit) caption of the Statements of Consolidated Comprehensive Income (Loss).

See Note J of the Notes to the Condensed Consolidated Financial Statements for tax details associated with the transaction.

Other corporate assets

During the three months ended March 31, 2025, Ashland completed the sale of a land property with a net book value of zero .

Ashland received net proceeds and recorded a pre-tax gain of $ 11 million within the income (loss) on acquisitions and divestitures, net caption of the Statements of Condensed Consolidated Comprehensive Income (Loss) for the three and six months ended March 31, 2025 .

Ashland received net proceeds and recorded a pre-tax gain of $ 11 million within the loss on acquisitions and divestitures, net caption of the Statement of Condensed Consolidated Comprehensive Income (Loss) for the nine months ended June 30, 2025 .

NOTE C – DISCONTINUED OPERATIONS

Ashland has divested certain businesses that have qualified as discontinued operations.

The operating results from these divested businesses and subsequent adjustments related to ongoing assessments of certain retained liabilities and income tax items have been recorded within the income (loss) from discontinued operations, net of income taxes caption in the Statements of Condensed Consolidated Comprehensive Income (Loss) for all periods presented.

Due to the ongoing assessment of certain matters associated with previous divestitures, subsequent adjustments to these divestitures may continue in future periods in the income (loss) from discontinued operations, net of income taxes caption in the Statements of Condensed Consolidated Comprehensive Income (Loss).

The following divested businesses represent disposal groups that qualified as discontinued operations in previous periods and impacted discontinued operations for the three and six months ended March 31, 2025 and 2024:

The operating results from these divested businesses and subsequent adjustments related to ongoing assessments of certain retained liabilities and income tax items have been recorded within the loss from discontinued operations, net of income taxes caption in the Statements of Condensed Consolidated Comprehensive Income (Loss) for all periods presented.

Due to the ongoing assessment of certain matters associated with previous divestitures, subsequent adjustments to these divestitures may continue in future periods in the loss from discontinued operations, net of income taxes caption in the Statements of Condensed Consolidated Comprehensive Income (Loss).

• The Performance Adhesives business divested in 2022;

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(Valvoline) business divested in 2017;

• The sale of Ashland Water Technologies (Water Technologies) business divested in 2014;

• The sale of the Ashland Distribution (Distribution) business divested in 2011.

Additionally, Ashland is subject to liabilities from claims alleging personal injury caused by exposure to asbestos.

Such claims result primarily from indemnification obligations undertaken in 1990 in connection with the sale of Riley Stoker Corporation ("Riley"), a former subsidiary, which qualified as a discontinued operation and from the acquisition during 2009 of Hercules LLC (formerly Hercules Incorporated) ("Hercules"), an indirect wholly-owned subsidiary of Ashland.

Adjustments to the recorded litigation reserves and related insurance receivables are recorded within the loss from discontinued operations, net of income taxes caption within the Statements of Condensed Consolidated Comprehensive Income (Loss).

See Note L of the Notes to the Condensed Consolidated Financial Statements for more information related to the adjustments on asbestos liabilities and receivables.

Components of amounts reflected in the Statements of Condensed Consolidated Comprehensive Income (Loss) related to discontinued operations are presented in the following table:

Three months ended

Six months ended

Nine months ended

(In millions)

Income (loss) from discontinued operations, net of income taxes

Performance Adhesives

Composites/Marl facility

Water Technologies

Asbestos-related litigation

NOTE D – RESTRUCTURING ACTIVITIES

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As a part of this program, Ashland is also advancing a multi-year manufacturing optimization restructuring plan to improve operational cost and strengthen its competitive position.

During the three and six months ended March 31, 2025 , Ashland incurred $ 13 million of accelerated depreciation for product line optimization activities associated with a Life Sciences manufacturing facility, which was recorded within the cost of sales caption of the Statements of Condensed Consolidated Comprehensive Income (Loss).

During the three and nine months ended June 30, 2025 , Ashland incurred $ 27 million and $ 40 million, respectively, of accelerated depreciation for product line optimization activities associated with manufacturing facilities within the Life Sciences, Personal Care and Specialty Additives reportable segments, which was recorded within the cost of sales caption of the Statements of Condensed Consolidated Comprehensive Income (Loss).

During fiscal 2023, Ashland implemented targeted organizational restructuring actions to reduce costs.

This program continued into fiscal 2024 and 2025.

During the three and six months ended March 31, 2024 , Ashland incurred $ 27 million and $ 49 million, respectively, of accelerated depreciation for product line optimization activities associated with two Specialty Additives manufacturing facilities, which was recorded within the cost of sales caption of the Statements of Condensed Consolidated Comprehensive Income (Loss).

This program continued into fiscal 2024.

During the three and nine months ended June 30, 2024 , Ashland incurred $ 7 million and $ 55 million, respectively, of accelerated depreciation for product line optimization activities associated with two Specialty Additives manufacturing facilities, which was recorded within the cost of sales caption of the Statements of Condensed Consolidated Comprehensive Income (Loss).

During both the three and nine months ended June 30, 2024 , Ashland incurred $ 1 million, of accelerated depreciation for product line optimization activities associated with a Personal Care manufacturing facility, which was recorded within the cost of sales caption of the Statements of Consolidated Comprehensive Income (Loss).

The following tables detail the amount of restructuring severance expense related to these programs.

Three months ended March 31, 2025

Three months ended March 31, 2024

Three months ended June 30, 2025

Three months ended June 30, 2024

(In millions)

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2023 Restructuring program

(a) Severance expense is recorded within the selling, general and administrative expense caption of the Statements of Condensed Consolidated Comprehensive Income (Loss) for the three months ended March 31, 2025 and 2024.

Six months ended March 31, 2025

Six months ended March 31, 2024

Nine months ended June 30, 2025

Nine months ended June 30, 2024

(In millions)

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2023 Restructuring program

The following table details at March 31, 2025 the amount of restructuring severance liabilities related to these programs.

The following table details at June 30, 2025, the amount of restructuring severance liabilities related to these programs.

(In millions)

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Utilization (cash paid)

Balance at March 31, 2025 (a)

(a) The restructuring severance liability associated with these programs is recorded within accrued expenses and other liabilities in the Condensed Consolidated Balance Sheets at March 31, 2025 and September 30, 2024 .

Balance at June 30, 2025 (a)

NOTE E – FAIR VALUE MEASUREMENTS

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For all other assets and liabilities for which unobservable inputs are used (Level 3), fair value is derived through the use of fair value models, such as a discounted cash flow model or other standard pricing models that Ashland deems reasonable.

The following table summarizes financial instruments subject to recurring fair value measurements as of March 31, 2025:

The following table summarizes financial instruments subject to recurring fair value measurements as of June 30, 2025:

(In millions)

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Investment of captive insurance company (c)

Foreign currency derivatives (d)

Commodity derivatives (d)

Total assets at fair value

Foreign currency derivatives (e)

Total liabilities at fair value

(a) Includes $ 283 million within restricted investments and $ 67 million within other current assets in the Condensed Consolidated Balance Sheet .

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(d) Included in accounts receivable, net in the Condensed Consolidated Balance Sheet.

The following table summarizes financial asset instruments subject to recurring fair value measurements as of September 30, 2024:

(e) Included in accrued expenses and other liabilities in the Condensed Consolidated Balance Sheet.

The following table summarizes financial instruments subject to recurring fair value measurements as of September 30, 2024:

(In millions)

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The financial instruments are designated as investment securities, classified as Level 1 measurements within the fair value hierarchy.

These securities were classified primarily as noncurrent restricted investment assets, with $ 73 million classified within other current assets, in the Condensed Consolidated Balance Sheets at both March 31, 2025 and September 30, 2024.

These investment securities were classified primarily as noncurrent restricted investment assets, with $ 67 million and $ 73 million classified within other current assets, in the Condensed Consolidated Balance Sheets at June 30, 2025 and September 30, 2024, respectively.

The following table presents gross unrealized gains and losses for the restricted investments as of:

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Unrealized Loss

March 31, 2025

June 30, 2025

Demand deposit

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Three months ended

Six months ended

Nine months ended

(In millions)

Investment income (a)

Net gains (losses) (a)

Net gains (a)

Funds restricted for specific transactions

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The impacts of these contracts were largely offset by gains and losses resulting from the impact of changes in exchange rates on transactions denominated in non-functional currencies.

The following table summarizes the gains and losses recognized within the Statements of Condensed Consolidated Comprehensive Income (Loss):

The following table summarizes the gains recognized within the Statements of Condensed Consolidated Comprehensive Income (Loss):

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Nine months ended

(In millions)

Foreign currency derivative gains (losses)

Foreign currency derivative gains

The following table summarizes the fair values of the outstanding foreign currency derivatives included in accounts receivable, net and accrued expenses and other liabilities of the Condensed Consolidated Balance Sheets as of:

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Three months ended

Six months ended

Nine months ended

(In millions)

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Other financial instruments

At March 31, 2025 and September 30, 2024 , Ashland's long-term debt (including the current portion and excluding debt issuance cost discounts) had a carrying value of $ 1,347 million and $ 1,361 million, respectively, compared to a fair value of $ 1,292 million and $ 1,327 million, respectively.

At June 30, 2025 and September 30, 2024 , Ashland's long-term debt (including the current portion and excluding debt issuance cost discounts) had a carrying value of $ 1,392 million and $ 1,361 million, respectively, compared to a fair value of $ 1,361 million and $ 1,327 million, respectively.

The fair values of long-term debt are based on quoted market prices (level 1 of the fair value hierarchy).

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Ashland tests goodwill and other indefinite-lived intangible assets for impairment annually as of July 1 or whenever events and circumstances indicate an impairment may have occurred.

No indicators of impairment were identified during the three and six months ended March 31, 2025 .

The following is a progression of goodwill by reportable segment for the six months ended March 31, 2025:

During the third quarter fiscal 2025, Ashland experienced a continued decline in the market price of its Common Stock.

Ashland also experienced slowing growth due to weakening macroeconomic environment that is dampening consumer sentiment and demand globally which resulted in lower growth and lower margins specifically for the Life Sciences and Specialty Additives reportable segments (and reporting units) than what was previously forcasted.

These factors led Ashland to determine that triggering events occurred, and a quantitative goodwill impairment assessment was performed during the three months ended June 30, 2025.

Following the aforementioned quantative analysis, the carrying value of the Life Sciences and the Specialty Additives reporting units exceeded their fair value, resulting in non-cash goodwill impairment charges of $ 375 million and $ 331 million, respectively, for a total goodwill impairment charge of $ 706 million, which was recorded

within the goodwill impairment caption of the Statements of Condensed Consolidated Comprehensive Income (Loss) for the three and nine months ended June 30, 2025.

No subsequent indicators of impairment have been identified.

The pre-impairment goodwill balance for the Life Sciences and Specialty Additives reporting units were $ 841 million and $ 443 million, respectively.

The goodwill impairment charges are nondeductible for tax purposes.

The valuation used to test goodwill for impairment is dependent upon a number of significant estimates and assumptions, including macroeconomic conditions, growth rates, competitive activities, cost containment, margin expansion, and Ashland's business plans.

Ashland believes these estimates and assumptions are reasonable.

However, future changes in the judgments, assumptions, and estimates that are used in the impairment testing for goodwill, including discount and tax rates or future cash flow projections, could result in significantly different estimates of the fair values.

As a result of these factors and other factors discussed above and the limited or no cushion (or headroom as commonly referred) for the Life Sciences and Specialty Additives reporting units, goodwill assets are more susceptible to impairment risk.

Ashland is required to provide additional disclosures about fair value measurements as part of the Condensed Consolidated Financial Statements for each major category of assets and liabilities measured at fair value on a non-recurring basis (including impairment assessments).

Goodwill was valued using Level 3 inputs, which are unobservable by nature, and included internal estimates of future cash flows (income approach).

Significant increases (decreases) in any of those unobservable inputs in isolation would result in a significantly higher (lower) fair value measurement.

The most significant assumptions used in the determination of the estimated fair value of the indefinite-lived intangible assets and reporting units are sales and EBITDA growth rates (including terminal growth rates) and the discount rate.

The terminal growth rate represents the rate at which the reporting unit is expected to grow beyond the shorter-term business planning period.

The terminal growth rate utilized in Ashland’s fair value estimate is consistent with the reporting unit operating plans and approximates expected long-term category market growth rates and inflation.

The discount rate, which is consistent with a weighted-average cost of capital that is likely to be expected by a market participant, is based upon industry required rates of return, including consideration of both debt and equity components of the capital structure.

The discount rates may be impacted by adverse changes in the macroeconomic environment, volatility in the equity and debt markets, or other factors.

While Ashland can implement and has implemented certain strategies to address the events that triggered the interim impairment assessment, future changes in operating plans or other adverse changes could result in a further decline in fair value that would trigger a future material impairment charge of the reporting unit’s goodwill balance.

The following is a progression of goodwill by reportable segment for the nine months ended June 30, 2025:

(In millions)

Additives (a)

Intermediates (a)

Balance at September 30, 2024

Intermediates

Balance at September 30, 2024 (a)

Currency translation

Avoca business - divestiture (b)

Balance at March 31, 2025

(a) As of March 31, 2025 and September 30, 2024 , there were accumulated impairments of $ 356 million, $ 174 million and $ 90 million related to the Personal Care, Specialty Additives and Intermediates reportable segments, respectively.

(b) Ashland allocated $ 1 million to the Avoca disposal group during the six months ended March 31, 2025 .

Balance at June 30, 2025 (c)

(a) As of September 30, 2024 , there were accumulated impairments of zero , $ 356 million, $ 174 million and $ 90 million related to the Life Sciences, Personal Care, Specialty Additives and Intermediates reportable segments, respectively.

(b) Ashland allocated $ 1 million to the Avoca business during the nine months ended June 30, 2025.

See Note B of the Notes to the Condensed Consolidated Financial Statements for more information.

(c) As of June 30, 2025, there were accumulated impairments of $ 375 million, $ 356 million, $ 505 million and $ 90 million related to the Life Sciences, Personal Care, Specialty Additives and Intermediates reportable segments, respectively.

Other intangible assets

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Ashland annually reviews, as of July 1, indefinite-lived intangible assets for possible impairment or whenever events or changes in circumstances indicate that carrying amounts may not be recoverable.

No indicators of impairment were identified during the three and six months ended March 31, 2025 , other than the other intangible assets within the Avoca business.

See Note B of the Notes to the Condensed Consolidated Financial Statements for further information.

In conjunction with the triggering events described above, Ashland tested its indefinite-lived intangible assets for impairment as of June 30, 2025.

Trademarks and trade names are valued using a “relief-from-royalty” valuation method compared to the carrying value.

No impairment was indicated for trademarks and trade names for the three and nine months ended June 30, 2025 , other than the other intangible assets disposed of within the Avoca business.

See Note B of the Notes to the Condensed Consolidated Financial Statements for further information with respect to the Avoca business.

However, similar to the factors discussed with respect to goodwill above and limited cushion, certain indefinite-lived intangible assets are more susceptible to impairment risk.

Other intangible assets were comprised of the following as of:

March 31, 2025

June 30, 2025

September 30, 2024

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Total intangible assets

(a) Ashland allocated $ 7 million to the Avoca business during the six months ended March 31, 2025.

(a) Ashland allocated $ 7 million to the Avoca business during the nine months ended June 30, 2025 .

See Note B of the Notes to the Condensed Consolidated Financial Statements for additional details.

(b) Ashland allocated $ 29 million to the Avoca business during the six months ended March 31, 2025.

(b) Ashland allocated $ 29 million to the Avoca business during the nine months ended June 30, 2025 .

See Note B of the Notes to the Condensed Consolidated Financial Statements for additional details.

Amortization expense recognized on intangible assets was $ 15 million and $ 20 million for the three months ended March 31, 2025 and 2024 , respectively, and $ 32 million and $ 40 million for the six months ended March 31, 2025 and 2024 , respectively, and is included within the intangibles amortization expense caption of the Statements of Condensed Consolidated Comprehensive Income (Loss).

Estimated amortization expense for future periods is $ 61 million in 2025 (includes six months actual and six months estimated), $ 57 million in 2026, $ 35 million in 2027, $ 33 million in 2028 and $ 26 million in 2029.

Amortization expense recognized on intangible assets was $ 15 million and $ 19 million for the three months ended June 30, 2025 and 2024 , respectively, and $ 47 million and $ 59 million for the nine months ended June 30, 2025 and 2024 , respectively, and is included within the intangibles amortization expense caption of the Statements of Condensed Consolidated Comprehensive Income (Loss).

Estimated amortization expense for future periods is $ 62 million in 2025 (includes nine months actual and three months estimated), $ 58 million in 2026, $ 37 million in 2027, $ 33 million in 2028 and $ 27 million in 2029.

Actual amounts may change from such estimated amounts due to fluctuations in foreign currency exchange rates, additional intangible asset acquisitions and divestitures, potential impairment, accelerated amortization, or other events.

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(In millions)

March 31, 2025

June 30, 2025

September 30, 2024

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6.50 % Junior Subordinated Notes, due 2029

Short-term debt

Long-term debt (less debt issuance costs)

(a) Other includes $ 11 million and $ 12 million of debt issuance costs as of March 31, 2025 and September 30, 2024, respectively.

The current portion of the long-term debt was zero for both March 31, 2025 and September 30, 2024 .

The scheduled aggregate maturities for long-term debt by year (excluding debt issuance costs) are as follows as of March 31, 2025 :

Long-term debt (less debt issuance costs) (b)

(a) Other includes $ 10 million and $ 12 million of debt issuance costs as of June 30, 2025 and September 30, 2024, respectively.

(b) The current portion of the long-term debt was zero for both June 30, 2025 and September 30, 2024 .

The scheduled aggregate maturities for long-term debt by year (excluding debt issuance costs) are as follows as of June 30, 2025 :

zero in 2025 and 2026, $ 4 million in 2027, $ 586 million in 2028, $ 97 million in 2029, and zero in 2030.

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Accounts Receivable Sales Program

Ashland recognized a loss of $ 1 million and $ 1 million within the Statements of Condensed Consolidated Comprehensive Income (Loss) for the three months ended March 31, 2025 and 2024 , respectively, and $ 2 million and $ 2 million for the six months ended March 31, 2025 and 2024 , respectively, within the net interest and other expense (income) caption associated with sales under the program.

Ashland has recorded $ 60 million in sales at March 31, 2025 against the buyer’s limit, which was $ 60 million at March 31, 2025 compared to $ 71 million of sales at September 30, 2024 against the buyer's limit, which was $ 71 million at September 30, 2024 .

Ashland transferred $ 73 million and $ 85 million in accounts receivable to the special purpose entity as of March 31, 2025 and September 30, 2024, respectively.

Ashland recorded liabilities related to its service obligations and limited guarantee as of March 31, 2025 and September 30, 2024 of less than $ 1 million.

As of March 31, 2025 and 2024 , the year-to-date gross cash proceeds received for accounts receivable transferred and derecognized were $ 189 million and $ 174 million, respectively, of which $ 200 million and $ 159 million were collected, which includes collections from sales in prior years transferred to the buyer.

The difference between accounts receivable transferred and derecognized versus collected of $ 11 million and $ 15 million for the six months ended March 31, 2025 and 2024, respectively, represents the impact of a net reduction and a net increase in accounts receivable sales volume during each period, respectively.

Ashland recognized a loss of $ 1 million within the Statements of Condensed Consolidated Comprehensive Income (Loss) for both the three months ended June 30, 2025 and 2024 , and $ 3 million for both the nine months ended June 30, 2025 and 2024 , within the net interest and other expense (income) caption associated with sales under the program.

Ashland has recorded $ 60 million in sales at June 30, 2025 , against the buyer’s limit, which was $ 60 million at June 30, 2025 compared to $ 71 million of sales at September 30, 2024 against the buyer's limit, which was $ 71 million at September 30, 2024 .

Ashland transferred $ 76 million and $ 85 million in accounts receivable to the special purpose entity as of June 30, 2025 and September 30, 2024, respectively.

Ashland recorded liabilities related to its service obligations and limited guarantee as of June 30, 2025 and September 30, 2024 , of less than $ 1 million.

As of June 30, 2025 and 2024 , the year-to-date gross cash proceeds received for accounts receivable transferred and derecognized were $ 290 million and $ 244 million, respectively, of which $ 301 million and $ 233 million were collected, which includes collections from sales in prior years transferred to the buyer.

The difference between accounts receivable transferred and derecognized versus collected of $ 11 million for both the nine months ended June 30, 2025 and 2024 represents the impact of a net reduction and a net increase in accounts receivable sales volume during each period, respectively.

Foreign Accounts Receivable Sales Program

Ashland has recorded $ 117 million in sales at March 31, 2025 against the buyer’s limit, which was $ 117 million at March 31, 2025 compared to $ 104 million of sales at September 30, 2024 against the buyer's limit, which was $ 104 million at September 30, 2024 .

Ashland transferred $ 152 million and $ 155 million in accounts receivable to the special purpose entity as of March 31, 2025 and September 30, 2024, respectively.

Ashland recorded liabilities related to its service obligations and limited guarantee as of March 31, 2025 and September 30, 2024 of less than $ 1 million.

As of March 31, 2025 and 2024 , the year-to-date gross cash proceeds received for accounts receivable transferred and derecognized were $ 242 million and $ 122 million, respectively, of which $ 233 million and zero million were collected.

The difference between accounts receivable transferred and derecognized versus collected of $ 9 million and $ 122 million for the six months ended March 31, 2025 and 2024, respectively, represents the impact of a net increase in accounts receivable sales volume during each period, respectively.

Ashland recognized a loss of $ 1 million and less than $ 1 million within the Statements of Condensed Consolidated Comprehensive Income (Loss) for the three months ended June 30, 2025 and 2024 , respectively, and $ 3 million and $ 2 million for the nine months ended June 30, 2025 and 2024 , respectively, within the net interest and other expense (income) caption associated with sales under the program.

Ashland has recorded $ 123 million in sales at June 30, 2025 against the buyer’s limit, which was $ 123 million at June 30, 2025 compared to $ 104 million o f sales at September 30, 2024 against the buyer's limit, which was $ 104 million at September 30, 2024 .

Ashland transferred $ 169 million and $ 155 million in accounts receivable to the special purpose entity as of June 30, 2025 and September 30, 2024, respectively.

Ashland recorded liabilities related to its service obligations and limited guarantee as of June 30, 2025 and September 30, 2024 of less than $ 1 million.

As of June 30, 2025 and 2024 , the year-to-date gross cash proceeds received for accounts receivable transferred and derecognized were $ 413 million and $ 123 million, respectively, of which $ 400 million and zero million were collected.

The difference between accounts receivable transferred and derecognized versus collected of $ 13 million and $ 123 million for the nine months ended June 30, 2025 and 2024, respectively, represents the impact of a net increase in accounts receivable sales volume during each period, respectively.

Supply Chain Finance Program

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Ashland provides no guarantees to JP Morgan and Taulia Alliance under this program.

As of March 31, 2025, the program is still in implementation with no active supplier participation.

The program was implemented during June 2025 and has been actively offered to suppliers.

As of June 30, 2025, participation in the program was not significant.

Available borrowing capacity and liquidity

The borrowing capacity remaining under current credit agreement (the “2022 Credit Agreement”) was $ 546 million, which reflects reductions for utilization of $ 50 million of the $ 600 million Revolving Credit Facility and $ 4 million for letters of credit outstanding as of March 31, 2025.

The borrowing capacity remaining under current credit agreement (the “2022 Credit Agreement”) was $ 596 million, which reflects the full $ 600 million Revolving Credit Facility less a reduction of $ 4 million for letters of credit outstanding as of June 30, 2025.

Ashland had no available liquidity under its current U.S.

and Foreign Accounts Receivable Sales Programs as of March 31, 2025.

and Foreign Accounts Receivable Sales Programs as of June 30, 2025.

Covenants related to current Ashland debt agreements

Ashland's debt contains usual and customary representations, warranties and affirmative and negative covenants, including financial covenants for leverage and interest coverage ratios, limitations on liens, additional subsidiary indebtedness, restrictions on subsidiary distributions, investments, mergers, sale of assets and restricted payments and other customary limitations.

As of March 31, 2025, Ashland is in compliance with all debt agreement covenant restrictions.

As of June 30, 2025, Ashland is in compliance with all debt agreement covenant restrictions.

The maximum consolidated net leverage ratio permitted under the 2022 Credit Agreement is 4.0 .

At March 31, 2025, Ashland’s calculation of the consolidated net leverage rat io was 2.9 .

At June 30, 2025, Ashland’s calculation of the consolidated net leverage r atio was 2.9 .

The minimum required consolidated interest coverage ratio under the 2022 Credit Agreement during its entire duration is 3.0 .

At March 31, 2025 , Ashland’s calculation of the interest coverage ratio was 7.0 .

At June 30, 2025 , Ashland’s calculation of the interest coverage ratio was 6.5 .

NOTE I – LEASING ARRANGEMENTS

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(In millions)

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Total lease cost

(a) Includes zero and $ 1 million charge for the impairment of an abandoned right of use office building asset for the three and six months ended March 31, 2024 .

Right-of-use assets exchanged for new operating lease obligations were $ 1 million and $ 2 million for the three ended March 31, 2025 and 2024 , respectively, and $ 2 million and $ 3 million for the six months ended March 31, 2025 and 2024, respectively.

During the second quarter of fiscal 2024, Ashland acquired a favorable lease asset for $ 10 million, which was recorded in the property, plant and equipment caption of the Condensed Consolidated Balance Sheet as of March 31, 2024.

(a) Includes zero and $ 1 million charge for the impairment of an abandoned right of use office building asset for the three and nine months ended June 30, 2024 .

Right-of-use assets exchanged for new operating lease obligations were $ 3 million and $ 1 million for the three ended June 30, 2025 and 2024 , respectively, and $ 5 million and $ 4 million for the nine months ended June 30, 2025 and 2024, respectively.

The following table provides cash paid for amounts included in the measurement of lease liabilities:

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(In millions)

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Ashland’s effective tax rate in any interim period is subject to adjustments related to discrete items and the mix of domestic and foreign operating results.

The overall effective tax rate was 23 % and 20 % for the three and six months ended March 31, 2025, respectively.

The tax rate for the three months ended March 31, 2025 was primarily impacted by jurisdictional income mix.

The tax rate for the six months ended March 31, 2025 was impacted by jurisdictional income mix, as well as a net $ 7 million from unfavorable tax discrete items primarily related to changes in foreign tax activity and final regulations issued in the United States impacting the recognition of deferred taxes on certain unrealized foreign exchange gains and losses.

The overall effective tax rate was an expense of 2 % and a benefit of 2 % for the three and nine months ended June 30, 2025, respectively.

The tax rate for the three months ended June 30, 2025 was primarily impacted by jurisdictional income mix, nondeductible goodwill impairment of $ 706 million and a net $ 16 million from unfavorable tax discrete items primarily related to return to provision adjustments and changes in uncertain tax positions.

The tax rate for the nine months ended June 30, 2025, was impacted by jurisdictional income mix, nondeductible goodwill impairment of $ 706 million, and a net $ 23 million from unfavorable tax discrete items primarily related to return to provision adjustments and changes in uncertain tax positions.

Prior fiscal year

The overall effective tax rate was a benefit of 612 % and 610 % for the three and six months ended March 31, 2024, respectively.

The tax rate for the three months ended March 31, 2024 was impacted by jurisdictional income mix, as well as a net $ 102 million from favorable tax discrete items primarily related to changes in foreign tax activity.

The tax rate for the six months ended March 31, 2024 was impacted by jurisdictional income mix, as well as net $ 126 million from favorable tax discrete items primarily related to changes in foreign tax activity.

The overall effective tax rate was a benefit of 144 % and 467 % for the three and nine months ended June 30, 2024, respectively.

The tax rate for the three months ended June 30, 2024, was impacted by jurisdictional income mix, as well as a net $ 104 million from favorable tax discrete items primarily related to the tax impact of the held for sale classification for the Nutraceuticals business.

The tax rate for the nine months ended June 30, 2024, was impacted by jurisdictional income mix, as well as net $ 231 million from favorable tax discrete items primarily related to changes in foreign tax activity and the tax impact of the held for sale classification for the Nutraceuticals business.

Unrecognized tax benefits

Changes in unrecognized tax benefits are summarized as follows for the six months ended March 31, 2025.

Changes in unrecognized tax benefits are summarized as follows for the nine months ended June 30, 2025.

(In millions)

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Increases related to positions taken in the prior year

Balance at March 31, 2025

Balance at June 30, 2025

From a combination of statute expirations and audit settlements in the next twelve months, Ashland expects a decrease in the amount of accrual for uncertain tax positions of between $ 2 million and $ 4 million for continuing operations.

For the remaining balance as of March 31, 2025 , it is reasonably possible that there could be material changes to the amount of uncertain tax positions due to activities of the taxing authorities, settlement of audit issues, reassessment of existing uncertain tax positions or the expiration of applicable statute of limitations;

For the remaining balance as of June 30, 2025, it is reasonably possible that there could be material changes to the amount of uncertain tax positions due to activities of the taxing authorities, settlement of audit issues, reassessment of existing uncertain tax positions or the expiration of applicable statute of limitations;

however, Ashland is not able to estimate the impact of these items at this time.

On July 4, 2025, “An Act to provide for reconciliation pursuant to title II of H.

14” – commonly referred to as the One Big Beautiful Bill Act (OBBBA) – was signed into law.

OBBBA includes several changes to the U.S.

federal income tax system, including modifications to the deduction for domestic research and development costs, expensing of certain business property, and changes to the limitation on business interest.

Ashland is currently

evaluating the provisions of OBBBA, including any forthcoming regulatory guidance, on its tax position and financial reporting.

Ashland will record any impact, which it does not anticipate to be material to the Condensed Consolidated Financial Statements, in the period of enactment (fourth quarter of fiscal 2025).

NOTE K - EMPLOYEE BENEFIT PLANS

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This resulted in a decrease in total expected future years of service within the plan and required Ashland to remeasure the plan as of December 31, 2024.

As a result, Ashland recorded a $ 1 million curtailment loss within the other net periodic benefit loss caption of the Statement of Condensed Consolidated Comprehensive Income (Loss) for the six months ended March 31, 2025.

Plan contributions

For the six months ended March 31, 2025 , Ashland contributed $ 4 million to its U.S.

For the nine months ended June 30, 2025 , Ashland contributed $ 5 million to its U.S.

pension plans and $ 4 million to its non-U.S.

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(In millions)

Three months ended March 31

Three months ended June 30

Interest cost

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Total net periodic benefit costs

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Nine months ended June 30

Interest cost

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For segment reporting purposes, service cost is proportionately allocated to each segment, excluding the Unallocated and other, and is recorded within the selling, general and administrative expense and cost of sales captions on the Statements of Condensed Consolidated Comprehensive Income (Loss).

All other components are recorded within the other net periodic benefit loss caption on the Statements of Condensed Consolidated Comprehensive Income (Loss), which netted to expense of $ 1 million and $ 3 million for the three and six months ended March 31, 2025 , respectively, and expense of $ 2 million and $ 4 million for the three and six months ended March 31, 2024 , respectively.

All other components are recorded within the other net periodic benefit loss caption on the Statements of Condensed Consolidated Comprehensive Income (Loss), which netted to expense of $ 1 million and $ 4 million for the three and nine months ended June 30, 2025 , respectively, and expense of $ 2 million and $ 6 million for the three and nine months ended June 30, 2024 , respectively.

NOTE L – LITIGATION, CLAIMS AND CONTINGENCIES

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Although Riley, a former subsidiary, was neither a producer nor a manufacturer of asbestos, its industrial boilers contained some asbestos-containing components provided by other companies.

Hercules, an indirect wholly-owned subsidiary of Ashland, has liabilities from claims alleging personal injury caused by exposure to asbestos.

Hercules, an indirect wholly-owned subsidiary of Ashland, has liabilities from claims alleging personal injury

caused by exposure to asbestos.

Such claims typically arise from alleged exposure to asbestos fibers from resin encapsulated pipe and tank products sold by one of Hercules’ former subsidiaries to a limited industrial market.

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Using that information, Gnarus estimates a range of the number of future claims that may be filed, as well as the related costs that may be incurred in resolving those claims.

Changes in asbestos-related liabilities and receivables are recorded on an after-tax basis within the income (loss) from discontinued operations, net of income taxes caption in the Statements of Condensed Consolidated Comprehensive Income (Loss).

Changes in asbestos-related liabilities and receivables are recorded on an after-tax basis within the loss from discontinued operations, net of income taxes caption in the Statements of Condensed Consolidated Comprehensive Income (Loss).

Ashland asbestos-related litigation

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A summary of Ashland asbestos claims activity, excluding Hercules claims, is as follows:

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During the most recent update completed in fiscal 2025, it was determined that the liability for Ashland asbestos-related claims should be increased by $ 16 million.

Total reserves for asbestos claims were $ 256 million and $ 274 million at March 31, 2025 and September 30, 2024, respectively.

Total reserves for asbestos claims were $ 265 million and $ 274 million at June 30, 2025 and September 30, 2024, respectively.

A progression of activity in the asbestos reserve is presented in the following table.

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Asbestos reserve - end of period (a)

(a) Includes $ 28 million classified in accrued expenses and other liabilities on the Condensed Consolidated Balance Sheets as of March 31, 2025 and September 30, 2024 .

(a) Includes $ 29 million and $ 28 million classified in accrued expenses and other liabilities on the Condensed Consolidated Balance Sheets as of June 30, 2025 and September 30, 2024 , respectively.

Ashland asbestos-related receivables

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Substantially all of the estimated receivables from insurance companies are expected to be due from domestic insurers, all of which are solvent.

At March 31, 2025 and September 30, 2024, Ashland’s receivable for recoveries of litigation defense and claim settlement costs from insurers amounted to $ 95 million (excluding the Hercules receivable for asbestos claims discussed below) and $ 97 million, respectively.

At June 30, 2025 and September 30, 2024 , Ashland’s receivable for recoveries of litigation defense and claim settlement costs from insurers amounted to $ 96 million (excluding the Hercules receivable for asbestos claims discussed below) and $ 97 million, respectively.

In fiscal 2025, the annual update of the model used for purposes of valuing the asbestos reserve and its impact on valuation of future recoveries from insurers was completed.

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A progression of activity in the Ashland insurance receivable is presented in the following table.

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Insurance receivable - beginning of year

Receivable adjustment (a)

Receivable adjustment

Amounts collected

Insurance receivable - end of period (b)

(a) The total allowance for credit losses was $ 1 million at of March 31, 2025 and September 30, 2024 .

(b) Includes $ 9 million classified in accounts receivable, net on the Condensed Consolidated Balance Sheets at March 31, 2025 and September 30, 2024 .

Insurance receivable - end of period (a)(b)

(a) The total allowance for credit losses was $ 1 million at June 30, 2025 and September 30, 2024 .

(b) Includes $ 10 million and $ 9 million classified in accounts receivable, net on the Condensed Consolidated Balance Sheets at June 30, 2025 and September 30, 2024 , respectively.

Hercules asbestos-related litigation

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A summary of Hercules’ asbestos claims activity follows:

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During the most recent update completed in fiscal 2025, it was determined that the liability for Hercules asbestos-related claims should be increased by $ 10 million.

Total reserves for asbestos claims were $ 180 million and $ 185 million at March 31, 2025 and September 30, 2024, respectively.

Total reserves for asbestos claims were $ 185 million at both June 30, 2025 and September 30, 2024.

A progression of activity in the asbestos reserve is presented in the following table.

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Asbestos reserve - end of period (a)

(a) Includes $ 17 million classified in accrued expenses and other liabilities on the Condensed Consolidated Balance Sheets at March 31, 2025 and September 30, 2024 .

(a) Includes $ 17 million classified in accrued expenses and other liabilities on the Condensed Consolidated Balance Sheets at both June 30, 2025 and September 30, 2024 .

Hercules asbestos-related receivables

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The estimated receivable consists exclusively of solvent domestic insurers.

As of March 31, 2025 and September 30, 2024, Ashland’s receivable for recoveries of litigation defense and claims costs from insurers with respect to Hercules amounted to $ 46 million and $ 50 million, respectively.

As of June 30, 2025 and September 30, 2024 , Ashland’s receivable for recoveries of litigation defense and claims costs from insurers with respect to Hercules amounted to $ 49 million and $ 50 million, respectively.

In fiscal 2025, the annual update of the model used for purposes of valuing the asbestos reserve and its impact on valuation of future recoveries from insurers was completed.

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A progression of activity in the Hercules insurance receivable is presented in the following table.

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Insurance receivable - beginning of year

Receivable adjustment (a)

Receivable adjustment

Amounts collected

Insurance receivable - end of period (b)

(a) The total allowance for credit losses was $ 1 million at March 31, 2025 and September 30, 2024 .

(b) Includes $ 6 million classified in accounts receivable, net on the Condensed Consolidated Balance Sheets at March 31, 2025 and September 30, 2024 .

Insurance receivable - end of period (a)(b)

(a) The total allowance for credit losses was $ 1 million at June 30, 2025 and September 30, 2024 .

(b) Includes $ 6 million classified in accounts receivable, net on the Condensed Consolidated Balance Sheets at both June 30, 2025 and September 30, 2024 .

Asbestos litigation cost projection

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Ashland has currently estimated in various models ranging from approximately 40 year periods that it is reasonably possible that total future litigation defense and claim settlement costs on an inflated and undiscounted basis could range as high as approximately $ 382 million for the Ashland asbestos-related litigation (current reserve of $ 265 million) and approximately $ 262 million for the Hercules asbestos-related litigation (current reserve of $ 185 million), depending on the combination of assumptions selected in the various models.

While the timeframe used in Ashland’s models for projecting asbestos liabilities generally decreases over time based on the expected lifetime of the liabilities, these models have been consistently applied between all periods presented.

While the timeframe used in Ashland’s models for projecting asbestos liabilities generally decreases over time based on the expected lifetime of the liabilities, these models have been consistently

applied between all periods presented.

If actual experience is worse than projected, relative to the number of claims filed, the severity of alleged disease associated with those claims or costs incurred to resolve those claims, or actuarial refinement or improvements to the assumptions used within these models are initiated, Ashland may need to further increase the estimates of the costs associated with asbestos claims and these increases could be material over time.

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Ashland is subject to various federal, state and local environmental laws and regulations that require environmental assessment or remediation efforts (collectively environmental remediation) at multiple locations.

At March 31, 2025 , such locations included 53 sites where Ashland has been identified as a potentially responsible party under Superfund or similar state laws, 108 current and former operating facilities and about 1,225 service station properties, of which 14 are being actively remediated.

Ashland’s reserves for environmental remediation and related environmental litigation amounted to $ 207 million and $ 221 million at March 31, 2025 and September 30, 2024 , respectively, of which $ 150 million and $ 164 million at March 31, 2025 and September 30, 2024, respectively, were classified in other noncurrent liabilities on the Condensed Consolidated Balance Sheets.

At June 30, 2025 , such locations included 53 sites where Ashland has been identified as a potentially responsible party under Superfund or similar state laws, 107 current and former operating facilities and about 1,225 service station properties, of which 14 are being actively remediated.

Ashland’s reserves for environmental remediation and related environmental litigation amounted to $ 242 million and $ 221 million at June 30, 2025 and September 30, 2024 , respectively, of which $ 185 million and $ 164 million at June 30, 2025 and September 30, 2024, respectively, were classified in other noncurrent liabilities on the Condensed Consolidated Balance Sheets.

The remaining reserves were classified in accrued expenses and other liabilities on the Condensed Consolidated Balance Sheets.

The following table provides a reconciliation of the changes in the environmental remediation reserves:

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Ashland has estimated the value of its probable insurance recoveries associated with its environmental reserve based on management’s interpretations and estimates surrounding the available or applicable insurance coverage.

At March 31, 2025 and September 30, 2024 , Ashland’s recorded receivables for these probable insurance recoveries were $ 12 million and $ 13 million, respectively, of which $ 10 million and $ 11 million at March 31, 2025 and September 30, 2024 , respectively, were classified in other noncurrent assets on the Condensed Consolidated Balance Sheets.

At June 30, 2025 and September 30, 2024 , Ashland’s recorded receivables for these probable insurance recoveries were $ 14 million and $ 13 million, respectively, of which $ 13 million and $ 11 million at June 30, 2025 and September 30, 2024 , respectively, were classified in other noncurrent assets on the Condensed Consolidated Balance Sheets.

Components of environmental remediation expense included within the selling, general and administrative expense caption of the Statements of Condensed Consolidated Comprehensive Income (Loss) are presented in the following table:

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Total expense, net of receivable activity (a)

(a) Net expense of zero for the three and six months ended March 31, 2025 and zero and $ 1 million for the three and six months ended March 31, 2024 , respectively, relates to divested businesses which qualified for treatment as discontinued operations for which certain environmental liabilities were retained by Ashland.

These amounts are classified within the income (loss) from discontinued operations, net of income taxes caption of the Statements of Condensed Consolidated Comprehensive Income (Loss).

(a) Net expense of $ 14 million for the three and nine months ended June 30, 2025 and $ 8 million and $ 10 million for the three and nine months ended June 30, 2024 , respectively, relates to divested businesses which qualified for treatment as discontinued operations for which certain environmental liabilities were retained by Ashland.

These amounts are classified within the loss from discontinued operations, net of income taxes caption of the Statements of Condensed Consolidated Comprehensive Income (Loss).

Environmental remediation reserves are subject to uncertainties that affect Ashland’s ability to estimate its share of the costs.

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Although it is not possible to predict with certainty the ultimate costs of environmental remediation, Ashland currently estimates that the upper end of the reasonably possible range of future costs for identified sites could be as high as approximately $ 510 million.

The largest reserve for any site is 22 % of the remediation reserve as of March 31, 2025.

The largest reserve for any site is 20 % of the remediation reserve as of June 30, 2025.

Other legal proceedings and claims

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Such actions are with respect to commercial matters, product liability, toxic tort liability, and other environmental matters, which seek remedies or damages, some of which are for substantial amounts.

While Ashland cannot predict with certainty the outcome of such actions, it believes that adequate reserves have been recorded and losses already recognized with respect to such actions were immaterial as of March 31, 2025.

There is a reasonable possibility that a loss exceeding amounts already recognized may be incurred related to these actions;

however, Ashland believes that such potential losses were immaterial as of March 31, 2025 .

NOTE M – EARNINGS PER SHARE

The following is the computation of basic and diluted earnings per share ("EPS") from continuing operations attributable to Ashland.

however, Ashland believes that such potential losses were immaterial as of June 30, 2025 .

NOTE M – EARNINGS (LOSS) PER SHARE

The following is the computation of basic and diluted earnings (loss) per share ("EPS") from continuing operations attributable to Ashland.

Stock appreciation rights and warrants available to purchase shares outstanding for each reporting period whose exercise price was greater than the average market price of Ashland common stock for each applicable period were not included in the computation of income (loss) from continuing operations per diluted share because the effect of these instruments would be antidilutive .

The total number of these shares outstanding was approximately 1 million at March 31, 2025 and 2024 .

The total number of these shares outstanding was approximately 2 million and 1 million at June 30, 2025 and 2024 , respectively.

The majority of these shares are for warrants with a strike price of $ 128.66 .

Earnings per share is reported under the treasury stock method.

EPS is reported under the treasury stock method.

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EPS from continuing operations

(a) As a result of the loss from continuing operations attributable to Ashland during the six months ended March 31, 2025 , the effect of the share-based awards convertible to common stock would be antidilutive and have been excluded from the diluted EPS calculation.

(a) As a result of the loss from continuing operations attributable to Ashland during the three and nine months ended June 30, 2025 , the effect of the share-based awards convertible to common stock would be antidilutive and have been excluded from the diluted EPS calculation.

NOTE N – EQUITY ITEMS

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The new authorization terminated and replaced the 2022 Stock Repurchase Program, which had $ 200 million outstanding at the date of termination.

As of March 31, 2025 , $ 520 million remained available for repurchase under the 2023 Stock Repurchase Program.

As of June 30, 2025 , $ 520 million remained available for repurchase under the 2023 Stock Repurchase Program.

The following table provides the common stock repurchase activity:

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Stockholder dividends

Dividends of 40.5 cents per share were paid in the first and second quarters of fiscal 2025 and 38.5 cents per share were paid in the first two quarters of fiscal 2024.

On May 6, 2025, Ashland's Board declared a quarterly cash dividend of $ 0.415 per share on the company's common stock representing a 2 % increase from the previous quarter.

The dividend was paid in the third quarter of fiscal 2025.

Dividends of $ 0.405 per share were paid in the first and second quarters of fiscal 2025 and the third quarter of fiscal 2024 and $ 0.385 per share were paid in the first and second quarters of fiscal 2024.

Accumulated other comprehensive loss

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Tax benefit (expense)

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Other comprehensive income (loss)

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Total other comprehensive income (loss)

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Other comprehensive income (loss)

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Balance, end of period

Accumulated other comprehensive income (loss)

Accumulated other comprehensive loss

Balance, beginning of period

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Cash dividends declared per common share

(a) Common stock issued were 52,993 and 32,458 for the three months ended March 31, 2025 and 2024 , respectively, and 128,401 and 110,807 for the six months ended March 31, 2025 and 2024 , respectively.

Includes zero and $ 1 million for the three months ended March 31, 2025 and 2024 , respectively, and $ 3 million and $ 4 million for the six months ended March 31, 2025 and 2024 , respectively, associated with stock-based compensation employee withholding taxes.

(b) Common stock repurchased were 1,541,320 for the three and six months ended March 31, 2025 , and zero and 1,238,212 for the three and six months ended March 31, 2024 .

(c) Includes $ 1 million in excise tax on common stock repurchases for both the three and six months ended March 31, 2025 , and zero and $ 1 million for the three and six months ended March 31, 2024 , respectively.

Ashland paid a total of $ 100 million for the three and six months ended March 31, 2025 and zero and $ 100 million for the three and six months ended March 31, 2024 , respectively, for common stock repurchases.

(a) Common stock issued were 11,423 and 18,909 for the three months ended June 30, 2025 and 2024 , respectively, and 139,824 and 129,716 for the nine months ended June 30, 2025 and 2024 , respectively.

Includes $ 1 million for both the three months ended June 30, 2025 and 2024 , and $ 4 million and $ 5 million for the nine months ended June 30, 2025 and 2024 , respectively, associated with stock-based compensation employee withholding taxes.

(b) Common stock repurchased were zero and 1,541,320 for the three and nine months ended June 30, 2025 , respectively, and 1,314,485 and 2,552,697 for the three and nine months ended June 30, 2024 , respectively.

(c) Includes zero and $ 1 million in excise tax on common stock repurchases for the three and nine months ended June 30, 2025 , respectively, and $ 1 million and $ 2 million for the three and nine months ended June 30, 2024 , respectively.

Ashland paid a total of zero and $ 100 million for the three and nine months ended June 30, 2025 , respectively, and $ 130 million and $ 230 million for the three and nine months ended June 30, 2024 , respectively, for common stock repurchases.

NOTE O – STOCK INCENTIVE PLANS

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Performance share awards

(a) Included zero and $ 1 million of expense related to cash-settled nonvested restricted stock awards during the three and six months ended March 31, 2025 , and zero and income of $ 1 million related to cash-settled performance units during the three and six months ended March 31, 2025 .

(b) Included zero and $ 1 million of expense related to cash-settled nonvested restricted stock awards during the three and six months ended March 31, 2024, and $ 1 million of expense and zero related to cash-settled performance units during the three and six months ended March 31, 2024 .

(a) Included zero and $ 1 million of expense related to cash-settled nonvested restricted stock awards during the three and nine months ended June 30, 2025 , respectively, and zero and income of $ 1 million related to cash-settled performance units during the three and nine months ended June 30, 2025 , respectively.

(b) Included $ 1 million and $ 2 million of expense related to cash-settled nonvested restricted stock awards during the three and nine months ended June 30, 2024, respectively, and zero expense related to cash-settled performance units during both the three and nine months ended June 30, 2024 .

NOTE P – REVENUE

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Latin America & other

For the six months ended March 31, 2025 , Ashland had two product categories that represented 10 % or greater of Ashland's total consolidated sales which were cellulosics representing 39 % of total consolidated sales and polyvinylpyrrolidones (PVP) representing 24 % of total consolidated sales.

Ashland has two product categories that represent 10% or greater of Ashland's total consolidated sales, which were cellulosics and polyvinylpyrrolidones (PVP).

The following table summarizes the percentage of Ashland's total consolidated sales by product:

Sales by product

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Trade receivables

Trade receivables are defined as receivables arising from contracts with customers and are recorded within the accounts receivable, net caption within the Condensed Consolidated Balance Sheets.

Ashland’s trade receivables were $ 189 million and $ 206 million as of March 31, 2025 and September 30, 2024 , respectively.

Ashland’s trade receivables were $ 158 million and $ 206 million as of June 30, 2025 and September 30, 2024 , respectively.

See Note H of the Notes to the Condensed Consolidated Financial Statements for additional information on Ashland’s programs to sell certain accounts receivables on a revolving basis to third party banks up to an aggregate purchase limit (U.S and Foreign Accounts Receivable Sales Programs).

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Ashland determines its reportable segments based on how operations are managed internally for the products and services sold to customers, including how the results are reviewed by the chief operating decision maker, which includes determining resource allocation methodologies used for reportable segments.

Operating income (loss) and EBITDA (EBITDA is defined as net income (loss), plus income tax expense (benefit), net interest and other expense (income), and depreciation and amortization) are the primary measures of performance that are reviewed by the chief operating decision maker in assessing each reportable segment's financial performance.

Operating loss and EBITDA (EBITDA is defined as net income (loss), plus income tax expense (benefit), net interest and other expense (income), and depreciation and amortization) are the primary measures of performance that are reviewed by the chief operating decision maker in assessing each reportable segment's financial performance.

Ashland does not aggregate segments to arrive at these reportable segments.

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OPERATING INCOME (LOSS)

Life Sciences

Life Sciences (b)

Personal Care

Specialty Additives

Specialty Additives (c)

Intermediates

Unallocated and other (b)

Unallocated and other (d)

DEPRECIATION EXPENSE

Life Sciences (c)

Personal Care

Specialty Additives (d)

Life Sciences (e)

Personal Care (f)

Specialty Additives (g)

Intermediates

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All other intersegment sales are accounted for at cost.

(b) Includes a $ 8 million gain on sale for the three and six months ended March 31, 2025 and a $ 183 million impairment charge for the six months ended March 31, 2025 , both related to the sale of the Avoca business within income (loss) on acquisitions and divestitures, net caption of the Statements of Condensed Consolidated Income (Loss).

(c) Depreciation includes accelerated depreciation of $ 13 million for Life Sciences for the three and six months ended March 31, 2025 .

(d) Depreciation includes accelerated depreciation of $ 27 million and $ 49 million for Specialty Additives for the three and six months ended March 31, 2024 , respectively.

(e) Excludes income (loss) from discontinued operations and other net periodic benefit loss.

(b) Includes goodwill impairment of $ 375 million for Life Sciences for the three and nine months ended June 30, 2025 .

(c) Includes goodwill impairment of $ 331 million for Specialty Additives for the three and nine months ended June 30, 2025 .

(d) Includes a $ 8 million gain on sale and a $ 183 million impairment charge related to the sale of the Avoca business for the nine months ended June 30, 2025 , and a $ 99 million impairment charge related to the sale of the Nutraceuticals business for the three and nine months ended June 30, 2024 , within the loss on acquisitions and divestitures, net caption of the Statements of Condensed Consolidated Income (Loss).

(e) Depreciation includes accelerated depreciation of $ 8 million and $ 21 million for Life Sciences for the three and nine months ended June 30, 2025 , respectively.

(f) Depreciation includes accelerated depreciation of $ 1 million for Personal Care for both the three and nine months ended June 30, 2024 .

(g) Depreciation includes accelerated depreciation of $ 19 million for Specialty Additives for both the three and nine months ended June 30, 2025 , and $ 7 million and $ 55 million for the three and nine months ended June 30, 2024 , respectively.

(h) Excludes loss from discontinued operations, net of income taxes and other net periodic benefit loss.

See the Statements of Condensed Consolidated Comprehensive Income (Loss) for applicable amounts excluded.

12 unchanged sentences

the effect of announced or future tariff increases;

the ongoing Ukraine/Russia and Israel/Hamas conflict on the geographies in which Ashland operates, the end markets Ashland serves and on Ashland’s supply chain and customers;

the ongoing Israel/Iran, Ukraine/Russia and Israel/Hamas conflict on the geographies in which Ashland operates, the end markets Ashland serves and on Ashland’s supply chain and customers;

and without limitation, risks and uncertainties affecting Ashland that are contained in “Use of estimates, risks and uncertainties” in Note A of Notes to Consolidated Financial Statements and in Item 1A of its most recent Form 10-K filed with SEC.

4 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements