Cabot (CBT) investor relations material

Executive summary

• Adjusted EPS for Q1 FY2026 was $1.53, down 13% year-over-year, with GAAP EPS at $1.37, reflecting lower EBIT in Reinforcement Materials and higher EBIT in Performance Chemicals.

• Net sales for Q1 FY2026 were $849 million, down $106 million year-over-year, driven by less favorable pricing, product mix, and lower volumes in both segments, partially offset by favorable currency impacts.

• Battery Materials product line delivered 39% revenue growth year-over-year, with EBITDA margins at 22% on a trailing twelve-month basis.

• Signed a multi-year supply agreement with PowerCo SE, a Volkswagen subsidiary, for lithium-ion battery materials, reinforcing leadership in Battery Materials.

• Returned $76 million to shareholders via dividends and share repurchases, supported by $126 million in operating cash flow.

Financial highlights

• Cash flows from operations reached $126 million; discretionary free cash flow was $71 million.

• Cash and cash equivalents stood at $230 million at quarter-end; liquidity position at $1.4 billion.

• Capital expenditures for Q1 were $69 million; full-year CapEx expected between $200 million and $230 million.

• Net debt to EBITDA stood at 1.2x as of December 31, 2025.

• Free cash flow for the quarter was $57 million.

Outlook and guidance

• Adjusted EPS guidance for FY2026 narrowed to $6.00–$6.50, assuming current FX, oil, and interest rates.

• Reinforcement Materials volumes expected to be flat year-over-year, with some loss in Europe offset by new assets in Indonesia and Mexico.

• Performance Chemicals segment anticipates low single-digit volume growth, led by battery materials and select end markets.

• Continued strong free cash flow and robust balance sheet expected to support investments and shareholder returns.

• Targeting an additional $30 million in cost savings in FY2026, on top of $50 million realized in FY2025.