Orion S.A. Announces Preliminary Full Year 2024 Update: Navigating Challenges and Opportunities

Orion S.A. (NYSE: OEC), a global specialty chemicals company, recently announced a preliminary unaudited financial update for its fiscal year ending December 31, 2024. The company expects its 2024 adjusted EBITDA to be nominally below the guidance range of $305-$315 million, primarily due to foreign exchange translation impacts related to the strengthening dollar and one-time costs associated with a cost reduction plan. Weaker than anticipated Rubber segment volumes late in the fourth quarter and slightly less favorable Specialty segment mix were also factors contributing to this adjustment.



Orion's Chief Executive Officer, Corning Painter, attributed the Rubber demand softness experienced late in the year to continued pressure on Western tire production resulting from elevated levels of tire imports into North America and Europe from Southeast Asia and China, as well as some year-end inventory adjustments at certain key customers. Despite these challenges, Painter expressed confidence in the Rubber segment's commercial strategy, positioning the company well for when trade flows rebalance within the global tire market.

In response to these challenges, Orion commenced an initiative to reduce its non-plant workforce by approximately 6% in the fourth quarter of 2024. This cost reduction plan is expected to realize around $6 million in annualized cost savings in 2025. Painter emphasized that, despite the strengthening FX headwind, the company continues to expect modest growth in 2025, building upon the structurally improved returns generated over the past several years.



Orion intends to report its fourth quarter and full year 2024 results after the market's close on Wednesday, February 19, 2025, followed by a conference call on Thursday, February 20, 2025, at 8:30 a.m. (ET). The dial-in details for the live conference call and the replay information will be provided on the company's website at orioncarbons.com.

In conclusion, Orion S.A. is navigating challenges related to foreign exchange translation impacts and cost reduction plans while maintaining a positive outlook for the future. The company's strategic initiatives and confidence in its Rubber segment's commercial strategy position it well for when trade flows rebalance within the global tire market. Investors should closely monitor Orion's progress and the potential implications of the strengthening dollar on its international operations.