4 unchanged sentences
Three months ended
−Removed: June 30, Six months ended
+Added: September 30, Nine months ended
+Added: September 30,
2022 2021 2022 2021
12 unchanged sentences
Net income (loss) from continuing operations 21,325 4,689 48,445 ( 5,929 )
−Removed: Net income (loss) from discontinued operations, net of tax — 6,520 — ( 83,250 )
+Added: Net loss from discontinued operations, net of tax — ( 75,872 ) — ( 159,122 )
Net income (loss) 21,325 ( 71,183 ) 48,445 ( 165,051 )
4 unchanged sentences
$ 21,325 $ 4,689 $ 48,445 $ ( 5,929 )
−Removed: Income (loss) from discontinued operations attributable to Ecovyst Inc.
+Added: Loss from discontinued operations attributable to Ecovyst Inc.
— ( 75,948 ) — ( 159,455 )
16 unchanged sentences
Three months ended
−Removed: June 30, Six months ended
+Added: September 30, Nine months ended
+Added: September 30,
2022 2021 2022 2021
4 unchanged sentences
Foreign currency translation ( 7,207 ) ( 7,884 ) ( 17,506 ) 418
−Removed: Total other comprehensive (loss) income ( 3,276 ) 12,534 8,102 9,395
+Added: Total other comprehensive income (loss) 972 ( 2,591 ) 9,074 6,804
Comprehensive income (loss) 22,297 ( 73,774 ) 57,519 ( 158,247 )
6 unchanged sentences
(in thousands, except share and per share amounts)
+Added: September 30,
2022 December 31,
24 unchanged sentences
authorized shares 450,000,000 ;
−Removed: issued shares 139,624,577 and 137,820,971 on June 30, 2022 and December 31, 2021, respectively;
−Removed: outstanding shares 137,817,183 and 136,938,758 on June 30, 2022 and December 31, 2021, respectively
+Added: issued shares 139,485,868 and 137,820,971 on September 30, 2022 and December 31, 2021, respectively;
+Added: outstanding shares 130,100,834 and 136,938,758 on September 30, 2022 and December 31, 2021, respectively
Preferred stock ($ 0.01 par);
authorized shares 50,000,000 ;
−Removed: no shares issued or outstanding on June 30, 2022 and December 31, 2021
+Added: no shares issued or outstanding on September 30, 2022 and December 31, 2021
Additional paid-in capital 1,088,704 1,073,409
1 unchanged sentence
Treasury stock, at cost;
−Removed: shares 1,807,394 and 882,213 on June 30, 2022 and December 31, 2021, respectively
+Added: shares 9,385,034 and 882,213 on September 30, 2022 and December 31, 2021, respectively
( 86,594 ) ( 12,551 )
25 unchanged sentences
Balance, June 30, 2022 $ 1,396 $ 1,084,790 $ ( 288,587 ) $ ( 21,725 ) $ 2,310 $ — $ 778,184
+Added: Net income — — 21,325 — — — 21,325
+Added: Other comprehensive income — — — — 972 — 972
+Added: Repurchases of common shares — — — ( 64,869 ) — — ( 64,869 )
+Added: Stock compensation expense — 3,872 — — — — 3,872
+Added: Shares issued under equity incentive plan, net of forfeitures ( 1 ) 42 — — — — 41
+Added: Balance, September 30, 2022 $ 1,395 $ 1,088,704 $ ( 267,262 ) $ ( 86,594 ) $ 3,282 $ — $ 739,525
stock Additional
17 unchanged sentences
Balance, June 30, 2021 $ 1,378 $ 1,492,334 $ ( 269,883 ) $ ( 12,551 ) $ ( 5,929 ) $ ( 740 ) $ 1,204,609
+Added: Net (loss) income — — ( 71,259 ) — — 76 ( 71,183 )
+Added: Other comprehensive income (loss) — — — — ( 3,255 ) 664 ( 2,591 )
+Added: Dividends paid on common stock ($ 3.20 per share)
+Added: — ( 435,593 ) — — — — ( 435,593 )
+Added: Stock compensation expense — 11,961 — — — — 11,961
+Added: Shares issued under equity incentive plan, net of forfeitures — 113 — — — — 113
+Added: Balance, September 30, 2021 $ 1,378 $ 1,068,815 $ ( 341,142 ) $ ( 12,551 ) $ ( 9,184 ) $ — $ 707,316
See accompanying notes to condensed consolidated financial statements.
2 unchanged sentences
(in thousands)
−Removed: Six months ended
+Added: Nine months ended
+Added: September 30,
Cash flows from operating activities:
21 unchanged sentences
Net cash provided by operating activities, continuing operations 109,325 92,286
−Removed: Net cash provided by operating activities, discontinued operations — 12,077
+Added: Net cash used by operating activities, discontinued operations — ( 7,420 )
Net cash provided by operating activities 109,325 84,866
1 unchanged sentence
Purchases of property, plant and equipment ( 39,474 ) ( 44,648 )
−Removed: Payments for business divestiture ( 3,744 ) —
+Added: Proceeds from business divestiture, net of cash — 980,350
+Added: Payments for business divestiture, net of cash ( 3,744 ) —
Business combinations, net of cash acquired ( 488 ) ( 42,782 )
Other, net 81 ( 8 )
−Removed: Net cash used in investing activities, continuing operations ( 29,498 ) ( 70,033 )
+Added: Net cash (used in) provided by investing activities, continuing operations ( 43,625 ) 892,912
Net cash used in investing activities, discontinued operations — ( 40,943 )
−Removed: Net cash used in investing activities ( 29,498 ) ( 102,043 )
+Added: Net cash (used in) provided by investing activities ( 43,625 ) 851,969
Cash flows from financing activities:
2 unchanged sentences
Repayments of long-term debt ( 6,750 ) ( 1,428,613 )
+Added: Debt prepayment fees — ( 8,481 )
+Added: Proceeds from failed sale-leaseback — 14,590
+Added: Dividends paid to stockholders — ( 435,593 )
Repurchases of common shares ( 73,711 ) —
Tax withholdings on equity award vesting ( 332 ) ( 1,470 )
+Added: Proceeds from stock options exercised 84 223
+Added: Repayment of financing obligations ( 1,849 ) ( 486 )
Other, net — ( 104 )
3 unchanged sentences
Effect of exchange rate changes on cash, cash equivalents and restricted cash ( 2,585 ) ( 4,681 )
−Removed: Net change in cash, cash equivalents and restricted cash 10,339 ( 62,208 )
−Removed: Cash, cash equivalents and restricted cash at beginning of period 140,889 137,219
−Removed: Cash, cash equivalents and restricted cash at end of period $ 151,228 $ 75,011
−Removed: cash, cash equivalents, and restricted cash of discontinued operations — ( 17,603 )
−Removed: Cash, cash equivalents and restricted cash at end of period of continuing operations $ 151,228 $ 57,408
+Added: Net change in cash and cash equivalents ( 19,443 ) ( 32,467 )
+Added: Cash and cash equivalents at beginning of period 140,889 137,219
+Added: Cash and cash equivalents at end of period $ 121,446 $ 104,752
For supplemental cash flow disclosures, see Note 21.
8 unchanged sentences
The Company believes that its products, which are predominantly inorganic, and services contribute to improving the sustainability of the environment.
−Removed: On December 14, 2020, the Company completed the sale of its Performance Materials business for $ 650,000 , and on August 1, 2021, the Company completed the sale of its Performance Chemicals business.
+Added: On December 14, 2020, the Company completed the sale of its Performance Materials business, and on August 1, 2021, the Company completed the sale of its Performance Chemicals business.
The financial results of these businesses are presented as discontinued operations in the condensed consolidated financial statements for the 2021 period presented.
−Removed: See Note 3 for more information on these transactions.
+Added: See Note 3 to these condensed consolidated financial statements for more information on these transactions.
The Company has two uniquely positioned specialty businesses:
10 unchanged sentences
The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.
+Added: Reclassification and Correction of an Error
+Added: During the preparation of the condensed consolidated financial statements for the period ended September 30, 2022, the Company identified a presentation error in the condensed consolidated statements of comprehensive income for the 2021 comparable periods presented.
+Added: The presentation of comprehensive income (loss) inadvertently omitted the release of accumulated other comprehensive income (loss) related to foreign currency translation and deferred pension and postretirement benefit plan losses in conjunction with the sale of the Company’s Performance Chemicals business.
+Added: There was no impact on the condensed consolidated statements of income, condensed consolidated balance sheets and condensed consolidated statements of cash flows.
+Added: The presentation of other comprehensive income (loss) for the three and nine months ended September 30, 2021, was corrected for the additional comprehensive loss of $ 7,093 , of which $ 943 of comprehensive income was attributed to noncontrolling interest.
+Added: Additionally, Note 6 was corrected for this presentation error.
+Added: The Company assessed the materiality of the error and concluded it was not material to the Company’s previously issued financial statements, including the consolidated financial statements for the year ended December 31, 2021.
+Added: The previously disclosed disposal of business presented in accumulated other comprehensive income (loss) has been reclassified to other comprehensive income (loss) in the condensed consolidated statement of stockholders’ equity.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
+Added: (Dollars in thousands, except share and per share amounts)
New Accounting Standards:
6 unchanged sentences
The Company adopted the new guidance on January 1, 2022 and will include the disclosures as required in its annual reporting with respect to any government assistance or grants subject to the scope of the guidance to the extent material.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (Dollars in thousands, except share and per share amounts)
Accounting Standards Not Yet Adopted
16 unchanged sentences
These services were provided for a period of nine months, with three 30-day extensions available.
−Removed: The Company billed $ 1,401 and $ 3,061 under the Transition Services Agreement to the buyer during the three and six months ended June 30, 2021.
−Removed: Those billings were included in selling, general and administrative expenses on the condensed consolidated financial statements for the six months ended June 30, 2021.
−Removed: During the three months ended June 30, 2021, the Company incurred transaction costs of $ 84 and stock-based compensation expense of $ 630 , and an associated tax benefit of $ 192 related to the Performance Materials divestiture, which was included in loss from discontinued operations, net of tax.
−Removed: During the six months ended June 30, 2021, the Company incurred transaction costs of $ 1,530 and stock-based compensation expense of $ 1,283 , and an associated tax benefit of $ 706 related to the Performance Materials divestiture, which was included in loss from discontinued operations, net of tax.
+Added: The Company billed $ 253 and $ 3,314 under the Transition Services Agreement to the buyer during the three and nine months ended September 30, 2021, respectively.
+Added: Those billings were included in selling, general and administrative expenses on the condensed consolidated financial statements for the nine months ended September 30, 2021.
+Added: During the three months ended September 30, 2021, the Company incurred transaction costs of $ 264 and stock-based compensation expense of $ 1,194 , and an associated tax benefit of $ 339 related to the Performance Materials divestiture, which was included in loss from discontinued operations, net of tax.
+Added: During the nine months ended September 30, 2021, the Company incurred transaction costs of $ 1,794 and stock-based compensation expense of $ 2,477 , and an associated tax benefit of $ 1,045 related to the Performance Materials divestiture, which was included in loss from discontinued operations, net of tax.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
+Added: (Dollars in thousands, except share and per share amounts)
Performance Chemicals Divestiture
2 unchanged sentences
The Company completed the sale of the Performance Chemicals business on August 1, 2021.
+Added: Prior to the close of the transaction, the disposal group was tested for recoverability at each of the balance sheet dates subsequent to meeting the discontinued operations criteria, and the Company recognized an estimated disposal loss of $ 13,990 and $ 109,584 during the three and six months ended June 30, 2021, respectively, which was included in net loss from discontinued operations, net of tax on the condensed consolidated statement of income.
+Added: For the nine months ended September 30, 2021, the loss on the sale of the Performance Chemicals business was $ 157,539 , which was included in net (loss) income from discontinued operations, net of tax in the Company’s condensed consolidated statements.
+Added: The following is a reconciliation of the loss recorded on the sale:
+Added: Net proceeds received from the sale of the Performance Chemicals business $ 980,350
+Added: Transaction costs ( 35,402 )
+Added: Net assets derecognized ( 1,102,487 )
+Added: Loss on sale of the Performance Chemicals business $ ( 157,539 )
During the year ended December 31, 2021, the net cash proceeds to the Company from the sale were $ 978,449 after certain customary adjustments for indebtedness, working capital and cash at the closing of the transaction.
−Removed: During the six months ended June 30, 2022, the Company made a payment to the buyer for $ 3,744 , representing the final adjustments to the sale price.
+Added: T he final pre-tax loss on the sale was $ 150,230 , which was included in net (loss) income from discontinued operations, net of tax in the Company’s consolidated statements of income for the year ended December 31, 2021.
+Added: In March 2022, the Company made a payment to the buyer for $ 3,744 , representing the final adjustments to the sale price.
The Company classified the payment within net cash used in investing activities – continuing operations in the condensed consolidated statements of cash flows.
−Removed: Prior to the close of the transaction, the disposal group was tested for recoverability at each of the balance sheet dates subsequent to meeting the discontinued operations criteria, and the Company recognized an estimated disposal loss of $ 13,990 and $ 109,584 during the three and six months ended June 30, 2021, respectively, which was included in net loss from discontinued operations, net of tax on the condensed consolidated statement of income.
−Removed: In the condensed consolidated balance sheet as of June 30, 2021, the Company recorded the disposal loss to goodwill and a valuation allowance of approximately $ 75,080 and $ 34,504 , respectively, which was included in long-term assets held for sale.
+Added: In connection with the sale of the Performance Chemicals business and the related loss, as noted above, the Company has recognized a tax benefit of $ 33,052 within net loss from discontinued operations, net of tax on the condensed consolidated statement of income.
AND SUBSIDIARIES
1 unchanged sentence
(Dollars in thousands, except share and per share amounts)
−Removed: The following table summarizes the results of discontinued operations related to the Performance Chemicals business for the three and six months ended June 30, 2021:
+Added: The following table summarizes the results of discontinued operations related to the Performance Chemicals business for the three and nine months ended September 30, 2021:
Three months ended
−Removed: June 30, 2021 Six months ended
−Removed: June 30, 2021
+Added: September 30, 2021 Nine months ended
+Added: September 30, 2021
Sales $ 54,973 $ 389,870
2 unchanged sentences
Goodwill impairment charge
−Removed: Other operating expense, net 11,850 29,330
+Added: Other operating (income) expense, net ( 18,993 ) 10,337
Loss on sale of the Performance Chemicals business 123,035 157,539
−Removed: Operating income (loss) 14,259 ( 71,861 )
+Added: Operating loss ( 95,203 ) ( 167,064 )
Equity in net (income) from affiliated companies ( 25 ) ( 111 )
Interest expense, net (1)
−Removed: Other income, net ( 840 ) ( 6,363 )
−Removed: Income (loss) from discontinued operations before income tax 9,548 ( 74,226 )
−Removed: Provision for income taxes 2,507 6,918
−Removed: Income (loss) from discontinued operations, net of tax $ 7,041 $ ( 81,144 )
+Added: Other expense (income), net 153 ( 6,210 )
+Added: Loss from discontinued operations before income tax ( 97,247 ) ( 171,473 )
+Added: Benefit for income taxes ( 22,494 ) ( 15,576 )
+Added: Loss from discontinued operations, net of tax $ ( 74,753 ) $ ( 155,897 )
(1) Upon the close of the transaction, the Company used a portion of the net proceeds to repay a portion of its outstanding debt amounting to $ 526,363 .
1 unchanged sentence
As a result, interest expense has been allocated to discontinued operations on the basis of the Company’s total repayment of $ 526,363 .
−Removed: Net income attributable to the noncontrolling interest related to the Performance Chemicals business, net of tax was $ 140 and $ 257 for the three and six months ended June 30, 2021 .
−Removed: Net income (loss) attributable to Ecovyst Inc., related to the Performance Chemicals business, net of tax was $ 6,901 and $( 81,401 ) for the three and six months ended June 30, 2021 .
+Added: Net income attributable to the noncontrolling interest related to the Performance Chemicals business, net of tax was $ 76 and $ 333 for the three and nine months ended September 30, 2021, respectively .
+Added: Net loss attributable to Ecovyst Inc., related to the Performance Chemicals business, net of tax was $( 74,829 ) and $( 156,230 ) for the three and nine months ended September 30, 2021, respectively .
Revenue from Contracts with Customers:
15 unchanged sentences
(Dollars in thousands, except share and per share amounts)
−Removed: The following tables disaggregate the Company’s sales, by segment and end use, for the three and six months ended June 30, 2022 and 2021:
−Removed: Three months ended June 30, 2022
+Added: The following tables disaggregate the Company’s sales, by segment and end use, for the three and nine months ended September 30, 2022 and 2021:
+Added: Three months ended September 30, 2022
Ecoservices Catalyst Technologies (2)
5 unchanged sentences
Total segment sales $ 195,674 $ 36,859 $ 232,533
−Removed: Three months ended June 30, 2021
+Added: Three months ended September 30, 2021
Ecoservices Catalyst Technologies (2)
5 unchanged sentences
Total segment sales $ 137,550 $ 29,878 $ 167,428
−Removed: Eliminations ( 4 ) — ( 4 )
−Removed: Total $ 120,737 $ 26,215 $ 146,952
−Removed: Six months ended June 30, 2022
+Added: Nine months ended September 30, 2022
Ecoservices Catalyst Technologies (2)
5 unchanged sentences
Total segment sales $ 542,703 $ 94,716 $ 637,419
−Removed: Six months ended June 30, 2021
+Added: Nine months ended September 30, 2021
Ecoservices Catalyst Technologies (2)
5 unchanged sentences
Total segment sales $ 358,509 $ 82,495 $ 441,004
−Removed: Eliminations ( 4 ) — ( 4 )
−Removed: Total segment sales $ 220,959 $ 52,617 $ 273,576
−Removed: (1) As described in Note 1, the Company experiences seasonal s ales fluctuations to customers in the fuels & emission control end use.
+Added: (1) As described in Note 1 to these condensed consolidated financial statements, the Company experiences seasonal s ales fluctuations to customers in the fuels & emission control end use.
(2) Excludes the Company’s proportionate share of sales from the Zeolyst International and Zeolyst C.V.
20 unchanged sentences
Unobservable inputs reflect the Company’s best estimate of what hypothetical market participants would use to determine a transaction price for the asset or liability at the reporting date.
−Removed: The following table presents information about the Company’s assets and liabilities that were measured at fair value on a recurring basis as of June 30, 2022 and December 31, 2021, and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value.
+Added: The following table presents information about the Company’s assets and liabilities that were measured at fair value on a recurring basis as of September 30, 2022 and December 31, 2021, and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value.
+Added: September 30,
2022 Quoted Prices in
6 unchanged sentences
Interest rate caps (Note 14) $ 35,991 $ — $ 35,991 $ —
−Removed: Derivative liabilities:
−Removed: Interest rate caps (Note 14) $ 16 $ — $ 16 $ —
2021 Quoted Prices in
19 unchanged sentences
For OTC derivatives that trade in liquid markets, such as forward contracts, swaps and options, model inputs can generally be corroborated by observable market data by correlation or other means, and model selection does not involve significant management judgment.
−Removed: As of June 30, 2022, th e Company had interest rate c aps th at were fair valued using Level 2 inputs.
+Added: As of September 30, 2022, th e Company had interest rate c aps th at were fair valued using Level 2 inputs.
In addition, the Company applies a credit valuation adjustment to reflect credit risk which is calculated based on credit default swaps.
4 unchanged sentences
Accumulated Other Comprehensive Income (Loss)
−Removed: The following tables present the tax effects of each component of other comprehensive income (loss) for the three and six months ended June 30, 2022 and 2021:
−Removed: Three months ended June 30,
+Added: The stockholders’ equity footnote disclosures have been revised to include the impact of discontinued operations on pensions and postretirement benefits and foreign currency translation for the three and nine months ended September 30, 2021 in other comprehensive income (loss) and accumulated other comprehensive income (loss).
+Added: See Note 1 to these condensed consolidated financial statements for further information on the reclassification and correction of errors in historical presentation.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
+Added: (Dollars in thousands, except share and per share amounts)
+Added: The following tables present the tax effects of each component of other comprehensive income (loss) for the three and nine months ended September 30, 2022 and 2021:
+Added: Three months ended September 30,
amount Tax benefit/
3 unchanged sentences
Defined benefit and other postretirement plans:
−Removed: Amortization of net gains $ — $ — $ — $ 2 $ ( 1 ) $ 1
−Removed: Amortization of prior service cost ( 52 ) 13 ( 39 ) ( 58 ) 15 ( 43 )
+Added: Amortization of net loss $ 2 $ ( 1 ) $ 1 $ 5,041 $ ( 1,297 ) $ 3,744
+Added: Amortization of prior service credit ( 53 ) 13 ( 40 ) ( 58 ) 14 ( 44 )
+Added: Settlement (loss) gain ( 1,228 ) 305 ( 923 ) 1,507 ( 374 ) 1,133
Benefit plans, net ( 1,279 ) 317 ( 962 ) 6,490 ( 1,657 ) 4,833
3 unchanged sentences
Other comprehensive income $ 3,702 $ ( 2,730 ) $ 972 $ ( 5,288 ) $ 2,697 $ ( 2,591 )
−Removed: Six months ended June 30,
+Added: Nine months ended September 30,
amount Tax benefit/
3 unchanged sentences
Defined benefit and other postretirement plans:
−Removed: Amortization of net gains $ 1 $ — $ 1 $ 3 $ ( 1 ) $ 2
−Removed: Amortization of prior service cost ( 105 ) 26 ( 79 ) ( 116 ) 29 ( 87 )
+Added: Amortization of net loss $ 3 $ ( 1 ) $ 2 $ 5,044 $ ( 1,298 ) $ 3,746
+Added: Amortization of prior service credit ( 158 ) 39 ( 119 ) ( 174 ) 43 ( 131 )
+Added: Settlement (loss) gain ( 1,228 ) 305 ( 923 ) 1,507 ( 374 ) 1,133
Benefit plans, net ( 1,383 ) 343 ( 1,040 ) 6,377 ( 1,629 ) 4,748
2 unchanged sentences
( 17,506 ) — ( 17,506 ) ( 6,536 ) 6,954 418
−Removed: Other comprehensive income (loss) $ 14,236 $ ( 6,134 ) $ 8,102 $ 7,313 $ 2,082 $ 9,395
+Added: Other comprehensive income $ 17,938 $ ( 8,864 ) $ 9,074 $ 2,025 $ 4,779 $ 6,804
+Added: (1) The income tax benefit or expense included in other comprehensive income is attributed to the portion of foreign currency translation associated with the Company’s cross-currency interest rate swaps for the three and nine months ended September 30, 2021, for which the tax effect is based on the applicable U.S.
+Added: deferred income tax rate.
+Added: See Note 14 to these condensed consolidated financial statements for information regarding the Company’s cross-currency interest rate swaps, which were settled in March 2021.
AND SUBSIDIARIES
1 unchanged sentence
(Dollars in thousands, except share and per share amounts)
−Removed: (1) The income tax benefit or expense included in other comprehensive income is attributed to the portion of foreign currency translation associated with the Company’s cross-currency interest rate swaps for the six months ended June 30, 2021, for which the tax effect is based on the applicable U.S.
−Removed: deferred income tax rate.
−Removed: See Note 14 to these condensed consolidated financial statements for information regarding the Company’s cross-currency interest rate swaps, which were settled in March 2021.
−Removed: The following table presents the changes in accumulated other comprehensive income (loss), net of tax, by component for the six months ended June 30, 2022 and 2021:
+Added: The following table presents the changes in accumulated other comprehensive income (loss), net of tax, by component for the nine months ended September 30, 2022 and 2021:
Defined benefit
4 unchanged sentences
December 31, 2021 $ 11,072 $ 2,254 $ ( 19,118 ) $ ( 5,792 )
−Removed: Other comprehensive income (loss) before reclassifications ( 155 ) 18,029 ( 10,299 ) 7,575
+Added: Other comprehensive (loss) income before reclassifications ( 1,157 ) 27,148 ( 17,506 ) 8,485
Amounts reclassified from accumulated other comprehensive income (1)
−Removed: June 30, 2022 $ 10,994 $ 20,733 $ ( 29,417 ) $ 2,310
+Added: 117 472 — 589
+Added: September 30, 2022 $ 10,032 $ 29,874 $ ( 36,624 ) $ 3,282
December 31, 2020 $ 5,278 $ ( 660 ) $ ( 19,883 ) $ ( 15,265 )
1 unchanged sentence
Amounts reclassified from accumulated other comprehensive income (1)
−Removed: June 30, 2021 $ 5,193 $ 518 $ ( 11,640 ) $ ( 5,929 )
+Added: 3,871 213 ( 11,779 ) ( 7,695 )
+Added: September 30, 2021 $ 10,026 $ 978 $ ( 20,188 ) $ ( 9,184 )
(1) See the following table for details about these reclassifications.
Amounts in parentheses indicate debits.
−Removed: The following table presents the reclassifications out of accumulated other comprehensive income for the three and six months ended June 30, 2022 and 2021:
+Added: The following table presents the reclassifications out of accumulated other comprehensive income for the three and nine months ended September 30, 2022 and 2021:
Details about Accumulated Other Comprehensive
4 unchanged sentences
Three months ended
−Removed: June 30, Six months ended
+Added: September 30, Nine months ended
+Added: September 30,
2022 2021 2022 2021
Amortization of defined benefit and other postretirement items:
−Removed: Prior service (cost) credit $ ( 53 ) $ ( 58 ) $ ( 105 ) $ ( 116 ) Other income (expense) (2)
−Removed: Actuarial gains (losses) 1 2 2 3 Other income (expense) (2)
+Added: Prior service credit $ ( 53 ) $ ( 58 ) $ ( 158 ) $ ( 174 ) Other income (expense) (2)
+Added: Actuarial gains 1 2 3 4 Other income (expense) (2)
+Added: Release of actuarial losses — ( 3,717 ) — ( 3,717 ) Net loss from discontinued operations, net of tax
( 52 ) ( 3,773 ) ( 155 ) ( 3,887 ) Total before tax
5 unchanged sentences
$ ( 22 ) $ ( 78 ) $ ( 472 ) $ ( 213 ) Net of tax
+Added: Release of foreign currency translation $ — $ 11,779 $ — $ 11,779 Net loss from discontinued operations, net of tax
Total reclassifications for the period $ ( 62 ) $ 7,917 $ ( 589 ) $ 7,695 Net of tax
12 unchanged sentences
The Company determined the timing and the amount of any repurchases based on its evaluation of market conditions, share price and other factors.
−Removed: The stock repurchase program expired in March 2022, with no repurchases made in 2022 through the expiration of the program, no r during the three or six months ended June 30, 2021.
+Added: The stock repurchase program expired in March 2022, with no repurchases made in 2022 through the expiration of the program, no r during the three or nine months ended September 30, 2021.
2022 Stock Repurchase Program
2 unchanged sentences
The Company will determine the timing and the amount of any repurchases based on its evaluation of market conditions, share price and other factors.
−Removed: During the three and six months ended June 30, 2022, the Company repurchased 893,123 shares on the open market at an average price of $ 9.88 , for a total of $ 8,842 (of which $ 1,715 was accrued at June 30, 2022).
−Removed: As of June 30, 2022, $ 441,158 was available for additional share repurchases under the program.
−Removed: In July 2022, the Company repurchased 1,077,640 shares on the open market at an average price of $ 9.77 , for a total of $ 10,553 as part of the approved stock repurchase program, which reduced availability for additional share repurchases under the program to $ 430,605 .
+Added: During the nine months ended September 30, 2022, the Company repurchased 1,970,763 shares of its common stock on the open market at an average price of $ 9.82 per share, for a total of $ 19,356 .
+Added: Additionally, in connection with a secondary offering of the Company’s common stock in August 2022 , the Company repurchased 6,500,000 shares of its common stock sold in the offering from underwriters at a price of $ 8.36 per share simultaneous with the closing of the offering, for a total of $ 54,316 .
+Added: As of September 30, 2022, $ 376,328 was available for additional share repurchases under the program.
+Added: There were no repurchases during September 2022.
Tax Withholdings on Equity Award Vesting
1 unchanged sentence
These transactions, when they occur, are accounted for as stock repurchases by the Company, with the shares returned to treasury stock at a cost representing the payment by the Company of the tax obligations on behalf of the employees in lieu of shares for the vesting unit.
−Removed: There were no shares delivered to the Company to cover tax payments for the three months ended June 30, 2022 and 2021 , and the fair value of the shares withheld to cover tax payments were $ 332 and $ 1,470 for the six months ended June 30, 2022 and 2021, respectively.
+Added: There were no shares delivered to the Company to cover tax payments for the three months ended September 30, 2022 and 2021, and the fair value of the shares withheld to cover tax payments were $ 332 and $ 1,470 for the nine months ended September 30, 2022 and 2021, respectively.
+Added: Dividends Paid
+Added: On August 4, 2021, the Board declared a special cash dividend of $ 3.20 per share, using after tax cash proceeds from the sale of the Performance Chemicals business.
+Added: The dividend was paid on August 23, 2021 to the Company’s stockholders of record at the close of business on August 12, 2021.
+Added: Refer to Note 3 of these condensed consolidated financial statements for additional details on the sale of the Performance Chemicals business.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
+Added: (Dollars in thousands, except share and per share amounts)
On March 1, 2021 (the “Closing Date”), the Company completed the acquisition of Chem32, LLC (“Chem32”) as part of a stock transaction (the “Acquisition”) for $ 44,000 in cash.
Based in Orange, Texas, Chem32 is a leader in ex situ pre-sulfiding and pre-activation for hydro-processing catalysts.
−Removed: The net cash paid on the Closing Date by the Company was $ 41,994 , after certain customary adjustments for indebtedness, working capital, cash and a holdback amount pursuant to the agreement.
−Removed: A portion of the holdback was settled in July 2021 for a payment of $ 645 , with $ 1,000 of the holdback remaining as of June 30, 2022.
+Added: The net cash paid by the Company was $ 42,639 , after certain customary adjustments for indebtedness, working capital, cash and a holdback amount pursuant to the agreement.
+Added: A portion of the holdback was settled in September 2022 for a payment of $ 488 , with $ 512 of the holdback remaining as of September 30, 2022.
Chem32 is reported as part of the Ecoservices segment.
The Company believes that the Acquisition will offer a more robust portfolio of services within the refining industry by leveraging the Company’s existing relationships, therefore contributing to a total purchase price that resulted in the recognition of $ 14,778 of goodwill, which was deductible for tax purposes.
−Removed: During the six months ended June 30, 2022 , the Company recorded an immaterial adjustment between goodwill and deferred tax liabilities related to the final tax purchase price allocation.
+Added: During the nine months ended September 30, 2022 , the Company recorded an immaterial adjustment between goodwill and deferred tax liabilities related to the final tax purchase price allocation.
See Note 8 to these condensed consolidated financial statements for further information.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (Dollars in thousands, except share and per share amounts)
The following table sets forth the calculation of the purchase price to the identifiable net assets acquired with respect to the Acquisition, which was complete as of December 31, 2021 :
19 unchanged sentences
Fair value of inventory is defined as estimated selling prices less the sum of (a) costs of disposal and (b) a reasonable profit allowance for the selling effort of the acquiring entity, which the Company determined acquired cost equaled fair value of the inventory acquired.
+Added: The Company’s cost of goods sold for the nine months ended September 30, 2021 includes a pre-tax charge of $ 148 of additional amortization expense related to identified intangible assets, which would have been recorded during the reporting period if the adjustments to the provisional amounts had been recognized as of the Closing Date.
+Added: The Company’s other operating expense, net for the nine months ended September 30, 2021 includes a pre-tax charge of $ 1,108 of additional amortization expense related to identified intangible assets, which would have been recorded during the reporting period if the adjustments to the provisional amounts had been recognized as of the Closing Date.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
+Added: (Dollars in thousands, except share and per share amounts)
The valuation of intangibles assets acquired and the related weighted-average amortization periods were as follows:
7 unchanged sentences
Total intangible assets subject to amortization $ 22,100
−Removed: Net sales and net income attributable to Chem32 during the period from the Closing Date through June 30, 2021 were immaterial.
−Removed: Pro forma financial information has not been presented as it is immaterial for the three and six months ended June 30, 2021.
−Removed: Acquisition and integration costs was immaterial for the six months ended June 30, 2021 and are included in other operating expense, net in the Company’s consolidated statement of income.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (Dollars in thousands, except share and per share amounts)
−Removed: The change in the carrying amount of goodwill for the six months ended June 30, 2022 is summarized as follows:
+Added: Net sales and net income attributable to Chem32 during the period from the Closing Date through September 30, 2021 were immaterial.
+Added: Pro forma financial information has not been presented as it is immaterial for the three and nine months ended September 30, 2021.
+Added: Acquisition and integration costs were $ 680 for the nine months ended September 30, 2021 and are included in other operating expense, net in the Company’s consolidated statement of income.
+Added: The change in the carrying amount of goodwill for the nine months ended September 30, 2022 is summarized as follows:
Ecoservices Catalyst Technologies Total
3 unchanged sentences
Foreign exchange impact — ( 4,906 ) ( 4,906 )
−Removed: Balance as of June 30, 2022 $ 326,589 $ 76,622 $ 403,211
−Removed: (1) During the six months ended June 30, 2022 , the Company recorded an adjustment of $ 81 between goodwill and deferred tax liabilities related to the final tax purchase price allocation for the Chem32 acquisition.
+Added: Balance as of September 30, 2022 $ 326,589 $ 74,563 $ 401,152
+Added: (1) During the nine months ended September 30, 2022 , the Company recorded an adjustment of $ 81 between goodwill and deferred tax liabilities related to the final tax purchase price allocation for the Chem32 acquisition.
Other Operating Expense, Net:
1 unchanged sentence
Three months ended
−Removed: June 30, Six months ended
+Added: September 30, Nine months ended
+Added: September 30,
2022 2021 2022 2021
6 unchanged sentences
$ 7,673 $ 6,314 $ 25,101 $ 16,786
−Removed: (1) During the three and six months ended June 30, 2022 and the six months ended June 30, 2021, the Company’s results were impacted by costs associated with severance charges for certain executives and employees.
+Added: (1) During the three months ended September 30, 2022 and the nine months ended September 30, 2022 and 2021 , respectively, the Company’s results were impacted by costs associated with severance charges for certain executives and employees.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
+Added: (Dollars in thousands, except share and per share amounts)
Inventories, Net:
Inventories, net are classified and valued as follows:
+Added: September 30,
2022 December 31,
7 unchanged sentences
$ 49,729 $ 53,813
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (Dollars in thousands, except share and per share amounts)
Investments in Affiliated Companies:
The Company accounts for investments in affiliated companies under the equity method.
−Removed: Affiliated companies accounted for on the equity basis as of June 30, 2022 are as follows:
+Added: Affiliated companies accounted for on the equity basis as of September 30, 2022 are as follows:
Company Country Percent
3 unchanged sentences
Three months ended
−Removed: June 30, Six months ended
+Added: September 30, Nine months ended
+Added: September 30,
2022 2021 2022 2021
5 unchanged sentences
the Company’s share of the net assets and net income of affiliates is calculated based on the percent ownership specified in the table above.
−Removed: The Company’s investments in affiliated companies balance as of June 30, 2022 and December 31, 2021 includes net purchase accounting fair value adjustments of $ 234,218 and $ 237,419 , respectively, related to a prior business combination, consisting primarily of goodwill and intangible assets such as customer relationships, technical know-how and trade names.
−Removed: Consolidated equity in net income from affiliates is net of $ 1,601 and $ 3,201 of amortization expense related to purchase accounting fair value adjustments for the three and six months ended June 30, 2022, respectively.
−Removed: Consolidated equity in net income from affiliates is net of $ 1,620 and $ 3,278 of amortization expense related to purchase accounting fair value adjustments for the three and six months ended June 30, 2021, respectively.
+Added: The Company’s investments in affiliated companies balance as of September 30, 2022 and December 31, 2021 includes net purchase accounting fair value adjustments of $ 232,617 and $ 237,419 , respectively, related to a prior business combination, consisting primarily of goodwill and intangible assets such as customer relationships, technical know-how and trade names.
+Added: Consolidated equity in net income from affiliates is net of $ 1,601 and $ 4,802 of amortization expense related to purchase accounting fair value adjustments for the three and nine months ended September 30, 2022, respectively.
+Added: Consolidated equity in net income from affiliates is net of $ 1,601 and $ 4,879 of amortization expense related to purchase accounting fair value adjustments for the three and nine months ended September 30, 2021, respectively.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
+Added: (Dollars in thousands, except share and per share amounts)
Property, Plant and Equipment:
A summary of property, plant and equipment, at cost, and related accumulated depreciation is as follows:
+Added: September 30,
2022 December 31,
−Removed: $ 96,665 $ 97,047
+Added: Land $ 96,391 $ 97,047
Buildings and improvements 80,932 77,851
Machinery and equipment 730,495 714,435
−Removed: 724,348 714,435
Construction in progress 58,476 45,952
966,294 935,285
−Removed: 953,268 935,285
accumulated depreciation ( 384,869 ) ( 339,054 )
$ 581,425 $ 596,231
−Removed: $ 583,636 $ 596,231
−Removed: Depreciation expense was $ 16,142 and $ 32,153 for the three and six months ended June 30, 2022, respectively.
−Removed: Depreciation expense was $ 17,529 and $ 33,533 for the three and six months ended June 30, 2021, respectively.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (Dollars in thousands, except share and per share amounts)
+Added: Depreciation expense was $ 16,103 and $ 48,256 for the three and nine months ended September 30, 2022, respectively.
+Added: Depreciation expense was $ 16,369 and $ 49,902 for the three and nine months ended September 30, 2021, respectively.
Long-term Debt:
The summary of long-term debt is as follows:
+Added: September 30,
2022 December 31,
8 unchanged sentences
The fair value of a financial instrument is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants.
−Removed: As of June 30, 2022 and December 31, 2021, the fair value of the senior secured term loan facility was $ 850,905 and $ 894,381 , respectively.
+Added: As of September 30, 2022 and December 31, 2021, the fair value of the senior secured term loan facility was $ 844,312 and $ 894,381 , respectively.
The fair value is classified as Level 2 based upon the fair value hierarchy (see Note 5 to these condensed consolidated financial statements for further information on fair value measurements).
10 unchanged sentences
The market risk associated with the Company’s derivative instruments is managed by establishing and monitoring parameters that limit the types and degree of market risk that may be undertaken.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
+Added: (Dollars in thousands, except share and per share amounts)
Use of Derivative Financial Instruments to Manage Interest Rate Risk.
1 unchanged sentence
Changes in interest rates will not affect the market value of such debt but will affect the Company’s interest payments over the term of the loans.
−Removed: Likewise, an increase in interest rates could have a material impact on the Company’s cash flow.
+Added: Likewise, an increase in interest rates could have a material impact on the Company’s condensed consolidated statements of cash flows.
The Company hedges the interest rate fluctuations on debt obligations through interest rate cap agreements.
−Removed: The Company records these agreements at fair value as assets or liabilities in its consolidated balance sheet.
+Added: The Company records these agreements at fair value as assets or liabilities in its condensed consolidated balance sheets.
As the derivatives are designated and qualify as cash flow hedges, the gains or losses on the interest rate cap agreements are recorded in stockholders’ equity as a component of OCI, net of tax.
4 unchanged sentences
In March 2020, the Company again amended such interest rate cap agreements to lower the cap rate to 0.84 % and paid an additional $ 900 premium annuitized during the effective period.
−Removed: The term and notional amount remained unchanged, and the total cumulative annuitized premium on the $ 500,000 of notional variable-rate debt is $ 4,410 .
−Removed: The cap rate in effect at June 30, 2022 was 0.84 % associated with the $ 500,000 of notional variable-rate debt.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (Dollars in thousands, except share and per share amounts)
+Added: The term and notional amount remained unchanged, and the total cumulative annuitized premium on the $ 500,000 of notional variable-rate debt was $ 4,410 .
In July 2020, the Company entered into additional interest rate cap agreements to mitigate interest rate volatility from August 2020 to August 2023, with a cap rate of 1.00 % on $ 400,000 of notional variable-rate debt.
−Removed: The cap rate in effect at June 30, 2022 was 1.00 % associated with the $ 400,000 of notional variable-rate debt.
−Removed: The total annuitized premium on the $ 400,000 of notional variable-rate debt is $ 137 .
+Added: The cap rate in effect at September 30, 2022 was 1.00 % associated with the $ 400,000 of notional variable-rate debt.
+Added: The total annuitized premium on the $ 400,000 of notional variable-rate debt was $ 137 .
In August 2021, PQ Corporation novated $ 900,000 of its interest rate caps to Ecovyst Catalyst Technologies LLC.
−Removed: Other than the novation, there were no other changes to the interest rate caps.
+Added: Other than the novation, there were no other changes to the interest rate caps in connection with the novation.
In January 2022, the Company entered into two new forward starting interest rate cap agreements, with notional amounts of $ 250,000 each and with a cap rate of 1.00 %.
−Removed: The term for one of these interest rate caps is August 2022 through October 2024 and the term for the other is September 2023 through October 2025.
+Added: The term for one of these interest rate caps is July 2022 through October 2024 and the term for the other is September 2023 through October 2025.
The total cumulative annuitized premium is $ 4,450 .
+Added: The cap rate in effect at September 30, 2022 was 1.00 %.
Use of Derivative Financial Instruments to Manage Foreign Currency Risk.
1 unchanged sentence
In February 2018, the Company entered into multiple cross-currency interest rate swap arrangements with an aggregate notional amount of € 280,000 to hedge this exposure on the net investments of certain of its Euro-denominated subsidiaries in its Performance Materials and Performance Chemicals businesses.
−Removed: The Company recorded these swap agreements at fair value as assets or liabilities in its consolidated balance sheet.
+Added: The Company recorded these swap agreements at fair value as assets or liabilities in its condensed consolidated balance sheet.
As the derivatives are designated and qualify as net investment hedges, changes in the fair value of the swaps attributable to changes in the spot exchange rates are recognized in cumulative translation adjustment (“CTA”) within OCI and are held there until the hedged net investments are sold or substantially liquidated.
3 unchanged sentences
At the date of settlement, the total notional value of the cross-currency swaps was $ 311,380 .
−Removed: The Company paid $ 13,170 in cash to settle the swaps, which is included in net cash used in investing activities, discontinued operations in the Company’s condensed consolidated statement of cash flows for the six months ended June 30, 2021, as the underlying subsidiary subject to the net investment hedging relationship is part of the Performance Chemicals business.
−Removed: The fair values of derivative instruments held as of June 30, 2022 and December 31, 2021 are shown below:
−Removed: Balance sheet location June 30,
+Added: The Company paid $ 13,170 in cash to settle the swaps, which is included in net cash used in investing activities, discontinued operations in the Company’s condensed consolidated statement of cash flows for the nine months ended September 30, 2021, as the underlying subsidiary subject to the net investment hedging relationship is part of the Performance Chemicals business.
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
+Added: (Dollars in thousands, except share and per share amounts)
+Added: The fair values of derivative instruments held as of September 30, 2022 and December 31, 2021 are shown below:
+Added: Balance sheet location September 30,
2022 December 31,
8 unchanged sentences
Total derivative liabilities $ — $ 1,288
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (Dollars in thousands, except share and per share amounts)
−Removed: The following tables show the effect of the Company’s derivative instruments designated as cash flow hedges on AOCI for the three and six months ended June 30, 2022 and 2021:
−Removed: Three months ended June 30,
+Added: The following tables show the effect of the Company’s derivative instruments designated as cash flow hedges on AOCI for the three and nine months ended September 30, 2022 and 2021:
+Added: Three months ended September 30,
Location of gain (loss) reclassified from AOCI into income Amount of gain (loss) recognized in OCI on derivatives Amount of gain (loss) reclassified from AOCI into income Amount of gain (loss) recognized in OCI on derivatives Amount of gain (loss) reclassified from AOCI into income
Interest rate caps Interest (expense) income $ 12,159 $ ( 29 ) $ 510 $ ( 104 )
−Removed: Six months ended June 30,
+Added: Nine months ended September 30,
Location of gain (loss) reclassified from AOCI into income Amount of gain (loss) recognized in OCI on derivatives Amount of gain (loss) reclassified from AOCI into income Amount of gain (loss) recognized in OCI on derivatives Amount of gain (loss) reclassified from AOCI into income
Interest rate caps Interest (expense) income $ 36,200 $ ( 627 ) $ 1,901 $ ( 283 )
−Removed: The following tables show the effect of the Company’s cash flow hedge accounting on the condensed consolidated statements of income for the three and six months ended June 30, 2022 and 2021:
−Removed: Three months ended June 30,
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
+Added: (Dollars in thousands, except share and per share amounts)
+Added: The following tables show the effect of the Company’s cash flow hedge accounting on the condensed consolidated statements of income for the three and nine months ended September 30, 2022 and 2021:
+Added: Three months ended September 30,
Cost of goods sold Interest (expense)
2 unchanged sentences
Interest contracts:
−Removed: Amount of gain (loss) reclassified from AOCI into income — ( 359 ) — ( 70 )
−Removed: Six months ended June 30,
+Added: Amount of loss reclassified from AOCI into income — ( 29 ) — ( 104 )
+Added: Nine months ended September 30,
Cost of goods sold Interest (expense)
2 unchanged sentences
Interest contracts:
−Removed: Amount of gain (loss) reclassified from AOCI into income — ( 598 ) — ( 179 )
−Removed: The amount of unrealized losses in AOCI related to the Company’s cash flow hedges that is expected to be reclassified to the condensed consolidated statement of income over the next twelve months is $ 286 as of June 30, 2022.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (Dollars in thousands, except share and per share amounts)
−Removed: The following table shows the effect of the Company’s net investment hedges on AOCI and the condensed consolidated statements of income for the three and six months ended June 30, 2021:
−Removed: Amount of gain (loss) recognized in OCI on derivative Location of gain (loss) reclassified from AOCI into income Amount of gain (loss) reclassified from AOCI into income Location of gain (loss) recognized in income on derivative (amount excluded from effectiveness testing) Amount of gain (loss) recognized in income on derivative (amount excluded from effectiveness testing)
+Added: Amount of loss reclassified from AOCI into income — ( 627 ) — ( 283 )
+Added: The amount of unrealized losses in AOCI related to the Company’s cash flow hedges that is expected to be reclassified to the condensed consolidated statement of income over the next twelve months is $ 275 as of September 30, 2022.
+Added: The following table shows the effect of the Company’s net investment hedges on AOCI and the condensed consolidated statements of income for the three and nine months ended September 30, 2021:
+Added: Amount of pre-tax gain recognized in OCI on derivative Location of gain (loss) reclassified from AOCI into income Amount of gain reclassified from AOCI into income Location of gain (loss) recognized in income on derivative (amount excluded from effectiveness testing) Amount of gain recognized in income on derivative (amount excluded from effectiveness testing)
Three months ended
−Removed: June 30, Three months ended
September 30, 2021 Three months ended
+Added: September 30, 2021 Three months ended
September 30, 2021
−Removed: 2022 2021 2022 2021 2022 2021
Cross-currency interest rate swaps $ — Net (loss) income from discontinued operations, net of tax $ 9,754 Interest (expense) income $ —
−Removed: Amount of pre-tax gain (loss) recognized in OCI on derivative Location of gain (loss) reclassified from AOCI into income Amount of gain (loss) reclassified from AOCI into income Location of gain (loss) recognized in income on derivative (amount excluded from effectiveness testing) Amount of gain (loss) recognized in income on derivative (amount excluded from effectiveness testing)
−Removed: Six months ended
−Removed: June 30, Six months ended
−Removed: June 30, Six months ended
−Removed: 2022 2021 2022 2021 2022 2021
+Added: Amount of pre-tax gain recognized in OCI on derivative Location of gain (loss) reclassified from AOCI into income Amount of gain reclassified from AOCI into income Location of gain (loss) recognized in income on derivative (amount excluded from effectiveness testing) Amount of gain recognized in income on derivative (amount excluded from effectiveness testing)
+Added: Nine months ended
+Added: September 30, 2021 Nine months ended
+Added: September 30, 2021 Nine months ended
+Added: September 30, 2021
Cross-currency interest rate swaps $ 9,787 Net (loss) income from discontinued operations, net of tax $ 9,754 Interest (expense) income $ 545
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
+Added: (Dollars in thousands, except share and per share amounts)
Income Taxes:
−Removed: The effective income tax rate for the three months ended June 30, 2022 was 27.5 % compared to ( 4,371.6 )% for the three months ended June 30, 2021.
−Removed: The effective income tax rate for the six months ended June 30, 2022 was 32.4 % compared to ( 30.9 )% for the six months ended June 30, 2021.
+Added: The effective income tax rate for the three months ended September 30, 2022 was 29.6 % compared to 35.6 % for the three months ended September 30, 2021.
+Added: The effective income tax rate for the nine months ended September 30, 2022 was 31.2 % compared to ( 610.9 )% for the nine months ended September 30, 2021.
The Company’s effective income tax rate has fluctuated primarily due to changes in income mix, discrete impacts related to intraperiod allocation revaluation of deferred tax assets and liabilities as a result of the divestiture of the Performance Chemicals business, tax rate changes and changes in foreign exchange gains and losses, which create permanent differences in certain jurisdictions.
The difference between the U.S.
−Removed: federal statutory income tax rate and the Company’s effective income tax rate for the six months ended June 30, 2022 was mainly due to state and local taxes, a discrete shortfall tax expense related to stock compensation, and a discrete tax expense associated with the Employee Retention Credit.
+Added: federal statutory income tax rate and the Company’s effective income tax rate for the nine months ended September 30, 2022 was mainly due to state and local taxes, a discrete shortfall tax expense related to stock compensation, and a discrete tax expense associated with the Employee Retention Credit.
The difference between the U.S.
−Removed: federal statutory income tax rate and the Company’s effective income tax rate for the six months ended June 30, 2021 was mainly due to state and local taxes, discrete tax impacts related to intra-period allocation revaluation of deferred tax assets and liabilities as a result of the Performance Chemicals divestiture, tax rate changes, and the tax effect of permanent differences related to foreign currency exchange gain or loss.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (Dollars in thousands, except share and per share amounts)
+Added: federal statutory income tax rate and the Company’s effective income tax rate for the nine months ended September 30, 2021 was mainly due to state and local taxes, discrete tax impacts related to intra-period allocation revaluation of deferred tax assets and liabilities as a result of the divestiture of the Performance Chemicals business, tax rate changes, and the tax effect of permanent differences related to foreign currency exchange gain or loss.
+Added: On August 16, 2022, the Inflation Reduction Act of 2022, or IRA, was signed into law.
+Added: Among other things, the IRA imposes a 15% corporate alternative minimum tax for certain large corporations with average annual adjusted financial statement income in excess of $1 billion, for tax years beginning after December 31, 2022, levies a 1% excise tax on net stock repurchases after December 31, 2022, and provides tax incentives to promote clean energy.
+Added: Historically, during the year we have made discretionary share repurchases.
+Added: Beginning in 2023, these purchases would be subject to the excise tax.
+Added: Based on the historical net repurchase activity the excise tax and the other provisions of the IRA are not expected to have a material impact on our results of operations or financial position.
+Added: However, we are still in the process of analyzing the provisions of the IRA.
Benefit Plans:
−Removed: The following tables present the components of net periodic cost (benefit) for the Company-sponsored defined benefit pension and postretirement plans, which cover certain employees and retirees located in the U.S.
+Added: The following tables present the components of net periodic expense (benefit) for the Company-sponsored defined benefit pension and postretirement plans, which cover certain employees and retirees located in the U.S.
Defined Benefit Pension Plans
Three months ended
−Removed: June 30, Six months ended
+Added: September 30, Nine months ended
+Added: September 30,
2022 2021 2022 2021
1 unchanged sentence
Expected return on plan assets ( 380 ) ( 1,093 ) ( 2,599 ) ( 3,280 )
−Removed: Net periodic benefit $ ( 506 ) $ ( 543 ) $ ( 1,012 ) $ ( 1,085 )
+Added: Settlement loss (gain) recognized 38 ( 26 ) 38 ( 26 )
+Added: Net periodic expense (benefit) $ 339 $ ( 568 ) $ ( 673 ) $ ( 1,654 )
Other Postretirement Benefit Plan
Three months ended
−Removed: June 30, Six months ended
+Added: September 30, Nine months ended
+Added: September 30,
2022 2021 2022 2021
3 unchanged sentences
Net periodic benefit $ ( 47 ) $ ( 52 ) $ ( 142 ) $ ( 157 )
+Added: AND SUBSIDIARIES
+Added: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
+Added: (Dollars in thousands, except share and per share amounts)
Commitments and Contingent Liabilities:
4 unchanged sentences
When these matters are ultimately concluded and determined, the Company believes that there will be no material adverse effect on its consolidated financial position, results of operations or liquidity.
−Removed: AND SUBSIDIARIES
−Removed: NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
−Removed: (Dollars in thousands, except share and per share amounts)
Reportable Segments:
1 unchanged sentence
Three months ended
−Removed: June 30, Six months ended
+Added: September 30, Nine months ended
+Added: September 30,
2022 2021 2022 2021
2 unchanged sentences
36,859 29,878 94,716 82,495
−Removed: Eliminations (2)
−Removed: — ( 4 ) — ( 4 )
Total $ 232,533 $ 167,428 $ 637,419 $ 441,004
7 unchanged sentences
joint ventures (collectively, the “Zeolyst Joint Venture”) accounted for using the equity method (see Note 11 to these condensed consolidated financial statements for further information).
−Removed: The proportionate share of sales is $ 35,906 and $ 64,883 for the three and six months ended June 30, 2022, respectively.
−Removed: The proportionate share of sales is $ 33,186 and $ 62,164 for the three and six months ended June 30, 2021, respectively.
+Added: The proportionate share of sales excluded is $ 27,773 and $ 92,656 for the three and nine months ended September 30, 2022, respectively.
+Added: The proportionate share of sales excluded is $ 32,820 and $ 94,984 for the three and nine months ended September 30, 2021, respectively.
(2) The Company defines Adjusted EBITDA as EBITDA adjusted for certain items as noted in the reconciliation below.
2 unchanged sentences
Adjusted EBITDA as defined by the Company may not be comparable with EBITDA or Adjusted EBITDA as defined by other companies.
−Removed: (3) The Adjusted EBITDA from the Zeolyst Joint Venture included in the Catalyst Technologies segment is $ 14,128 for the three months ended June 30, 2022, which includes $ 8,526 of equity in net income plus $ 1,600 of amortization of investment in affiliate step-up and $ 4,001 of joint venture depreciation, amortization and interest.
−Removed: The Adjusted EBITDA from the Zeolyst Joint Venture included in the Catalyst Technologies segment is $ 25,602 for the six months ended June 30, 2022, which includes $ 14,313 of equity in net income plus $ 3,201 of amortization of investment in affiliate step-up and $ 8,087 of joint venture depreciation, amortization and interest.
−Removed: The Adjusted EBITDA from the Zeolyst Joint Venture included in the Catalyst Technologies segment is $ 12,055 for the three months ended June 30, 2021, which includes $ 6,779 of equity in net income plus $ 1,620 of amortization of investment in affiliate step-up and $ 3,656 of joint venture depreciation, amortization and interest.
−Removed: The Adjusted EBITDA from the Zeolyst Joint Venture included in the Catalyst Technologies segment is $ 22,592 for the six months ended June 30, 2021, which includes $ 12,014 of equity in net income plus $ 3,278 of amortization of investment in affiliate step-up and $ 7,300 of joint venture depreciation, amortization and interest.
+Added: (3) The Adjusted EBITDA from the Zeolyst Joint Venture included in the Catalyst Technologies segment is $ 8,704 for the three months ended September 30, 2022, which includes $ 3,187 of equity in net income plus $ 1,601 of amortization of investment in affiliate step-up and $ 3,917 of joint venture depreciation, amortization and interest.
+Added: The Adjusted EBITDA from the Zeolyst Joint Venture included in the Catalyst Technologies segment is $ 34,306 for the nine months ended September 30, 2022, which includes $ 17,500 of equity in net income plus $ 4,802 of amortization of investment in affiliate step-up and $ 12,004 of joint venture depreciation, amortization and interest.
+Added: The Adjusted EBITDA from the Zeolyst Joint Venture included in the Catalyst Technologies segment is $ 14,493 for the three months ended September 30, 2021, which includes $ 8,780 of equity in net income plus $ 1,601 of amortization of investment in affiliate step-up and $ 4,112 of joint venture depreciation, amortization and interest.
+Added: The Adjusted EBITDA from the Zeolyst Joint Venture included in the Catalyst Technologies segment is $ 37,085 for the nine months ended September 30, 2021, which includes $ 20,794 of equity in net income plus $ 4,879 of amortization of investment in affiliate step-up and $ 11,412 of joint venture depreciation, amortization and interest.
AND SUBSIDIARIES
3 unchanged sentences
Three months ended
−Removed: June 30, Six months ended
+Added: September 30, Nine months ended
+Added: September 30,
2022 2021 2022 2021
9 unchanged sentences
Net loss on asset disposals 468 2,156 1,174 4,535
−Removed: Foreign exchange losses (gains) 502 ( 1,219 ) 1,148 3,882
−Removed: LIFO expense (benefit) 187 ( 450 ) 432 ( 703 )
+Added: Foreign exchange losses 1,030 922 2,179 4,803
+Added: LIFO benefit ( 436 ) ( 1,295 ) ( 4 ) ( 1,998 )
Transaction and other related costs 1,789 538 6,860 1,620
1 unchanged sentence
Restructuring, integration and business optimization expenses 1,322 78 6,421 2,408
−Removed: Defined benefit pension plan benefit ( 553 ) ( 595 ) ( 1,106 ) ( 1,190 )
+Added: Defined benefit pension plan expense (benefit) 292 ( 1,029 ) ( 814 ) ( 2,219 )
Other 1,282 30 1,416 1,723
2 unchanged sentences
The Company has an equity incentive plan under which it grants common stock awards to employees, directors and affiliates of the Company.
−Removed: At June 30, 2022, 9,327,270 shares of common stock were available for issuance under the plan.
+Added: At September 30, 2022, 9,501,030 shares of common stock were available for issuance under the plan.
The Company settles these awards through the issuance of new shares.
1 unchanged sentence
Restricted Stock Units
−Removed: During the six months ended June 30, 2022, the Company granted 2,750,234 restricted stock units under its equity incentive plan.
−Removed: Each restricted stock unit provides the recipient with the right to receive a share of common stock subject to graded vesting terms based on service, which for the awards granted during the six months ended June 30, 2022, generally requires approximately one year of service for members of the Company’s board of directors and approximately three years of service for employees.
−Removed: The awards granted during the six months ended June 30, 2022 also included a special grant for certain employees based on service which cliff vests on July 1, 2023.
−Removed: The value of the restricted stock units granted during the six months ended June 30, 2022 was based on the average of the high and low trading prices of the Company’s common stock on the NYSE on the preceding trading day, in accordance with the Company’s policy for valuing such awards.
+Added: During the nine months ended September 30, 2022, the Company granted 2,779,690 restricted stock units under its equity incentive plan.
+Added: Each restricted stock unit provides the recipient with the right to receive a share of common stock subject to graded vesting terms based on service, which for the awards granted during the nine months ended September 30, 2022, generally requires approximately one year of service for members of the Company’s board of directors and approximately three years of service for employees.
+Added: The awards granted during the nine months ended September 30, 2022 also included a special grant for certain employees based on service which cliff vests on July 1, 2023.
+Added: The value of the restricted stock units granted during the nine months ended September 30, 2022 was based on the average of the high and low trading prices of the Company’s common stock on the NYSE on the preceding trading day, in accordance with the Company’s policy for valuing such awards.
Compensation expense related to the restricted stock units is recognized on a straight-line basis over the respective vesting period.
3 unchanged sentences
Performance Stock Units
−Removed: During the six months ended June 30, 2022, the Company granted 295,132 performance stock units (at target) under its equity incentive plan.
−Removed: The performance stock units granted during the six months ended June 30, 2022 provide the recipients with the right to receive shares of common stock dependent on the achievement of a total shareholder return (“TSR”) goal, and are generally subject to the provision of service through the vesting date of the award.
+Added: During the nine months ended September 30, 2022, the Company granted 295,132 performance stock units (at target) under its equity incentive plan.
+Added: The performance stock units granted during the nine months ended September 30, 2022 provide the recipients with the right to receive shares of common stock dependent on the achievement of a total shareholder return (“TSR”) goal, and are generally subject to the provision of service through the vesting date of the award.
The performance period for the TSR goal is measured based on a three-year performance period from January 1, 2022 through December 31, 2024.
4 unchanged sentences
Because a market condition is not considered a vesting condition, it is reflected in the grant date fair value of the award and the associated compensation cost based on the fair value of the award is recognized over the performance period, regardless of whether the Company actually achieves the market condition or the level of achievement, as long as service is provided by the recipient.
−Removed: The Company used a Monte Carlo simulation to estimate the $ 8.82 weighted average fair value of the awards granted during the six months ended June 30, 2022, with the following weighted average assumptions:
+Added: The Company used a Monte Carlo simulation to estimate the $ 8.82 weighted average fair value of the awards granted during the nine months ended September 30, 2022, with the following weighted average assumptions:
Expected dividend yield — %
2 unchanged sentences
Expected term (in years) 2.91
−Removed: During the six months ended June 30, 2022, the Compensation Committee of the Company’s Board certified the achievement of the performance metrics for the three-year period ended December 31, 2021, related to the performance stock units granted during the year ended December 31, 2019.
+Added: During the nine months ended September 30, 2022, the Compensation Committee of the Company’s Board certified the achievement of the performance metrics for the three-year period ended December 31, 2021, related to the performance stock units granted during the year ended December 31, 2019.
These awards provided the recipients with the right to receive shares of common stock dependent on the achievement of two Company-specific financial performance targets and the provision of service through the vesting date, with each award holder eligible to earn a percentage of the target number of shares granted to the holder, ranging from zero to 200 %.
−Removed: The awards vested during the six months ended June 30, 2022 at 100 % of target.
+Added: The awards vested during the nine months ended September 30, 2022 at 100 % of target.
Award Activity
−Removed: The following table summarizes the activity for the Company’s restricted stock units and performance stock units for the six months ended June 30, 2022:
+Added: The following table summarizes the activity for the Company’s restricted stock units and performance stock units for the nine months ended September 30, 2022:
Restricted Stock Units Performance Stock Units
5 unchanged sentences
Forfeited ( 973,308 ) $ 12.59 ( 165,807 ) $ 12.46
−Removed: Nonvested as of June 30, 2022 2,986,789 $ 11.68 750,438 $ 15.70
+Added: Nonvested as of September 30, 2022 2,988,149 $ 11.67 750,438 $ 15.70
AND SUBSIDIARIES
2 unchanged sentences
Stock-Based Compensation Expense
−Removed: For the three months ended June 30, 2022 and 2021, stock-based compensation expense for the Company was $ 5,385 and $ 6,339 , respectively.
−Removed: The associated income tax benefit recognized in the statements of income for the three months ended June 30, 2022 and 2021 was $ 1,321 and $ 1,552 , respectively.
−Removed: For the six months ended June 30, 2022 and 2021, stock-based compensation expense for the Company was $ 12,679 and $ 12,644 , respectively.
−Removed: The associated income tax benefit recognized in the statements of income for the six months ended June 30, 2022 and 2021 was $ 3,109 and $ 3,095 , respectively.
−Removed: As of June 30, 2022, unrecognized compensation cost was $ 28,229 for restricted stock units and $ 4,353 for performance stock units considered probable of vesting.
−Removed: The weighted-average period over which these costs are expected to be recognized at June 30, 2022 was 1.70 years for the restricted stock units and 1.72 years for the performance stock units.
−Removed: Activity related to the Company’s stock options and restricted stock awards was not material for the six months ended June 30, 2022.
+Added: For the three months ended September 30, 2022 and 2021, stock-based compensation expense for the Company was $ 4,740 and $ 10,193 , respectively.
+Added: The associated income tax benefit recognized in the statements of income for the three months ended September 30, 2022 and 2021 was $ 1,162 and $ 2,494 , respectively.
+Added: For the nine months ended September 30, 2022 and 2021, stock-based compensation expense for the Company was $ 17,419 and $ 22,837 , respectively.
+Added: The associated income tax benefit recognized in the statements of income for the nine months ended September 30, 2022 and 2021 was $ 4,271 and $ 5,589 , respectively.
+Added: As of September 30, 2022, unrecognized compensation cost was $ 21,755 for restricted stock units and $ 3,083 for performance stock units considered probable of vesting.
+Added: The weighted-average period over which these costs are expected to be recognized at September 30, 2022 was 1.46 years for the restricted stock units and 1.46 years for the performance stock units.
+Added: Activity related to the Company’s stock options and restricted stock awards was not material for the nine months ended September 30, 2022.
Earnings per Share:
5 unchanged sentences
Three months ended
−Removed: June 30, Six months ended
+Added: September 30, Nine months ended
+Added: September 30,
2022 2021 2022 2021
7 unchanged sentences
Three months ended
−Removed: June 30, Six months ended
+Added: September 30, Nine months ended
+Added: September 30,
2022 2021 2022 2021
1 unchanged sentence
$ 21,325 $ 4,689 $ 48,445 $ ( 5,929 )
−Removed: Income (loss) from discontinued operations attributable to Ecovyst Inc.
+Added: Loss from discontinued operations attributable to Ecovyst Inc.
— ( 75,948 ) — ( 159,455 )
12 unchanged sentences
Three months ended
−Removed: June 30, Six months ended
+Added: September 30, Nine months ended
+Added: September 30,
2022 2021 2022 2021
11 unchanged sentences
With the exception of operating leases, the following table presents supplemental cash flow information for the consolidated Company:
−Removed: Six months ended
+Added: Nine months ended
+Added: September 30,
Cash paid during the period for:
3 unchanged sentences
Capital expenditures acquired on account but unpaid as of the period end 4,993 3,052
−Removed: Non-cash financing activity:
−Removed: Accrued share repurchases (Note 6) 1,715 —
Right-of-use assets obtained in exchange for new lease liabilities (non-cash):
Operating leases 6,187 7,946
−Removed: (1) Cash paid for interest is shown net of capitalized interest for the periods presented and excludes $ 2,307 of net interest proceeds on swaps designated as net investment hedges for the six months ended June 30, 2021, which are included within cash flows from investing activities, discontinued operations in the Company’s condensed consolidated statements of cash flows.
−Removed: The followin g table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets as of June 30, 2022 and 2021 to the total of the same amounts shown in the condensed consolidated statements of cash flows for the six months then ended:
−Removed: Cash and cash equivalents $ 151,228 $ 55,757
−Removed: Restricted cash included in prepaid and other current assets — 1,651
−Removed: Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows $ 151,228 $ 57,408
+Added: (1) Cash paid for interest is shown net of capitalized interest for the periods presented and excludes $ 2,307 of net interest proceeds on swaps designated as net investment hedges for the nine months ended September 30, 2021, which are included within cash flows from investing activities, discontinued operations in the Company’s condensed consolidated statements of cash flows.
Subsequent Events:
−Removed: In July 2022, the Company repurchased 1,077,640 shares on the open market at an average price of $ 9.77 , for a total of $ 10,553 as part of the approved stock repurchase program .
−Removed: See Note 6 to these condensed consolidated financial statements for further information.
−Removed: Other than this item, the Company has evaluated subsequent events since the balance sheet date and determined that there are no additional items to disclose.
+Added: The Company has evaluated subsequent events since the balance sheet date and determined that there are no additional items to disclose.
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.