Koppers Holdings Inc (KOP) 2025 Q2 法說會逐字稿

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to Koppers' second-quarter 2025 earnings conference call and webcast. (Operator Instructions) Please note that this event is being recorded.

女士們、先生們，早安。感謝您的支持。歡迎參加 Koppers 2025 年第二季財報電話會議和網路廣播。（操作員指示）請注意，此事件正在被記錄。

I will now turn the call over to Quynh McGuire. Please go ahead.

現在我將把電話轉給 Quynh McGuire。請繼續。

Thanks, and good morning. I'm Quynh McGuire, Vice President of Investor Relations. Welcome to our second-quarter 2025 earnings conference call. We issued our press release earlier today. You can access it via our website at www.koppers.com.

謝謝，早安。我是投資者關係副總裁 Quynh McGuire。歡迎參加我們的 2025 年第二季財報電話會議。我們今天早些時候發布了新聞稿。您可以透過我們的網站 www.koppers.com 造訪。

As indicated in our announcement, we've also posted materials to the Investor Relations page of our website that will be referenced in today's call. Consistent with our practice in prior quarterly conference calls, this is being broadcast live on our website and a recording of this call will be available on our website for replay through November 8, 2025. At this time, I would like to direct your attention to our forward-looking disclosure statement, seen on slide 2. Certain comments made on this conference call may be characterized as forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve a number of assumptions, risks and uncertainties, including risks described in the cautionary statement included in our press release and in the company's filings with the Securities and Exchange Commission.

正如我們的公告所示，我們還在我們網站的投資者關係頁面上發布了將在今天的電話會議中引用的資料。與我們先前的季度電話會議慣例一致，此次電話會議將在我們的網站上進行現場直播，並且本次電話會議的錄音將在我們的網站上提供，可重播至 2025 年 11 月 8 日。此時，我想提請您注意投影片 2 上的前瞻性揭露聲明。本次電話會議上發表的某些評論可能被視為《1995 年私人證券訴訟改革法案》所定義的前瞻性陳述。這些前瞻性陳述涉及許多假設、風險和不確定性，包括我們新聞稿中的警告聲明和公司向美國證券交易委員會提交的文件中所述的風險。

In light of the significant uncertainties inherent in the forward-looking statements included in the company's comments, you should not regard the inclusion of such information as a representation that its objectives, plans and projected results will be achieved. The company's actual results, performance or achievements may differ materially from those expressed in or implied by such forward-looking statements. The company assumes no obligation to update any forward-looking statements made during this call. Also, references may be made today to certain non-GAAP financial measures. The press release, which is available on our website also contains reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures.

鑑於公司評論中包含的前瞻性陳述本身存在重大不確定性，您不應將此類資訊的納入視為其目標、計劃和預計結果將會實現的代表。本公司的實際結果、業績或成就可能與此類前瞻性陳述中表達或暗示的結果、業績或成就有重大差異。本公司不承擔更新本次電話會議中所做的任何前瞻性陳述的義務。此外，今天可能會提到某些非公認會計準則財務指標。我們網站上的新聞稿還包含非公認會計準則 (GAAP) 財務指標與最直接可比較的公認會計準則 (GAAP) 財務指標的對帳。

Joining me for our call today are Leroy Ball, Chief Executive Officer and Chairman of the Board of Koppers; and Jimmi Sue Smith, Chief Financial Officer. At this time, I'll turn the discussion over to Leroy.

今天與我一起參加電話會議的還有 Koppers 執行長兼董事會主席 Leroy Ball 和財務長 Jimmi Sue Smith。現在，我將把討論交給 Leroy。

Thank you, Quynh. Good morning, everyone. I'm here this morning to report on Koppers second quarter performance and our progress in transforming into a high-performance organization, delivering mid- to high teens margins and stronger cash flow while staying rooted in our purpose of protecting what matters and preserving the future. This morning, you'll hear how we continue to make good progress in all controllable areas, while we fight through what has mostly been a sluggish demand environment across our entire portfolio.

謝謝你，Quynh。大家早安。今天上午，我在這裡匯報 Koppers 第二季度的業績以及我們在轉型為高績效組織方面取得的進展，實現了中高水平的利潤率和更強勁的現金流，同時始終堅持保護重要事物和保護未來的宗旨。今天上午，您將聽到我們如何在所有可控領域繼續取得良好進展，同時努力克服整個投資組合中普遍低迷的需求環境。

On slide 4, you'll see that on the plus side of the ledger, we lowered year-to-date SG&A by 13% compared with the prior year period. We reduced our team member numbers for 14 straight months, equating to an 11% drop in FTEs since April 24. We generated cash flow of over $50 million in the quarter, posted adjusted EBITDA margins north of 15% for the first time in eight years, brought our capital spend annual run rate down below $60 million, signed a definitive agreement to sell our railroad structures business, which has been a drag to margin, ceased production at our phthalic anhydride plant a month earlier than planned, deployed $24 million of capital to dividends, share repurchases and debt reduction and launched our Catalyst transformation process to unleash the ingenuity in the organization to deliver benefits that will bring coppers to consistent mid- to high teens EBITDA margins by the end of 2027.

在投影片 4 中，您會看到，在帳簿的正面，與去年同期相比，我們將年初至今的銷售、一般及行政費用降低了 13%。我們連續 14 個月減少團隊成員數量，相當於自 4 月 24 日以來全職員工人數下降了 11%。我們在本季度產生了超過 5,000 萬美元的現金流，調整後的 EBITDA 利潤率八年來首次超過 15%，將資本支出年運行率降至 6000 萬美元以下，簽署了出售拖累利潤率的鐵路結構業務的最終協議，比計劃提前一個月停止了鄰苯二甲酸酐工廠的生產，將 2400 萬美元的股利削減股票轉型流程，以釋放組織的創造力，帶來效益，到 2027 年底，銅的 EBITDA 利潤率將達到穩定的中高水準。

The biggest negative is on the demand side. And unfortunately, it's across the board. PC volumes beyond our previously disclosed market share loss are running a few percent down for the first 6 months, whereas we have projected them to be up for the year.

最大的負面因素在於需求面。不幸的是，這種情況是普遍存在的。除了我們先前揭露的市佔率損失之外，個人電腦銷售量在前 6 個月還下降了幾個百分點，而我們預計全年銷售量將會上升。

Class 1 demand looks to be tailing off in the second half as it did last year, which is not what had been communicated to us at the beginning of the year. CM&C markets continue to be at their trough with no immediate signs of improvement. And while UIP volumes are beginning to show signs of improvement, that improvement is occurring at a slower pace than had been signaled. I find it quite remarkable that we could post our highest second quarter adjusted EPS and a 9% improvement over prior year, with sales down over that same period by 10%. We have a lot to cover today, so let's jump in.

與去年一樣，一級需求在下半年似乎正在減少，這與年初向我們傳達的情況不同。CM&C 市場繼續處於低谷，沒有立即改善的跡象。儘管 UIP 數量開始出現改善跡象，但改善速度比預想的要慢。我覺得非常了不起的是，我們能夠實現第二季最高的調整後每股收益，並且比去年同期增長 9%，而同期銷售額卻下降了 10%。今天我們要討論的內容很多，讓我們開始吧。

Moving to a quick summary of our Zero Harm activities on slide 6. We show that we had 26 out of 41 facilities worldwide, operating accident-free for the second quarter. Year-to-date, our European CM&C, European PC and Australasian PC businesses have operated with 0 recordable incidents. Leading activities designed to proactively identify and eliminate hazards increased year-over-year in the second quarter, which were instrumental to lessening recordable injuries and serious safety incidents. Moreover, we just finished a line with 0 recordables, which is the first time in my memory that we've reached that milestone. My thanks go out to our global team members for continuing to make the health and welfare of your teammates, your number 1 priority.

投影片 6 簡要概述了我們的零傷害活動。數據顯示，第二季我們在全球 41 個設施中，有 26 個設施無事故營運。年初至今，我們的歐洲 CM&C、歐洲 PC 和澳洲 PC 業務的可記錄事故為 0 起。第二季度，主動識別和消除危險的主導活動同比增長，有助於減少可記錄的傷害和嚴重安全事故。此外，我們剛剛完成了一條記錄為 0 的生產線，這是我記憶中我們第一次達到這一里程碑。我感謝我們全球的團隊成員繼續將隊友的健康和福祉放在第一位。

On slide 7, our Susquehanna facility set the standard for operating safely this past year earning the 2025 Zero Harm CEO award. This award recognizes outstanding performance and achieving no critical incidents, maintaining a higher leading activity rate and lower incident rates than the overall coppers rates, respectively. The Susquehanna plant manufacturers pressure treated crossties, switch ties and bridge timbers selling its products throughout the Northeast US and Canada. Our sincere congratulations to plant manager Alrutz and his team for demonstrating zero harm principles on such a consistent basis and setting an example for the rest of the organization to follow.

在第 7 張投影片上，我們的 Susquehanna 工廠在過去一年中樹立了安全營運的標準，並獲得了 2025 年零傷害 CEO 獎。該獎項旨在表彰出色的表現，實現零重大事故、維持高於整體銅線率的領先活動率和低於整體銅線率的事故率。薩斯奎漢納工廠生產經過壓力處理的枕木、岔枕和橋樑木材，產品銷往美國東北部和加拿大各地。我們向工廠經理 Alrutz 和他的團隊表示誠摯的祝賀，他們如此始終如一地實踐零傷害原則，為組織其他成員樹立了榜樣。

As shown on Slide 9, we issued our 2024 Corporate Sustainability Report in June, once again highlighting the gains made in applying our core principles of people, planet and performance across all aspects of our business. We believe that maintaining responsible stewardship of the resources entrusted to us remains the key to promoting and achieving meaningful business growth. We're also wondered that Koppers has been named for the first time the Time Magazine America's Best Midsized Companies of 2025. This distinction recognizes exceptional performance in employee satisfaction, revenue growth and sustainability transparency is evaluated by Time and data analysis provider Statista. For more information, please access the QR codes seen here.

如投影片 9 所示，我們於 6 月發布了 2024 年企業永續發展報告，再次強調了我們在業務各個方面應用以人為本、地球和績效為核心原則所取得的成果。我們相信，對委託給我們的資源保持負責任的管理仍然是促進和實現有意義的業務成長的關鍵。我們也感到驚訝的是，Koppers 首次被《時代》雜誌評為 2025 年美國最佳中型公司。這項殊榮表彰了員工滿意度、收入成長和永續性透明度方面的卓越表現，由時間和數據分析提供者 Statista 進行評估。欲了解更多信息，請訪問此處的二維碼。

Moving on to Slide 10. In July, we signed a definitive agreement to sell our Railroad Structures business, which we refer to as KRS to a valued customer of ours and a cash transaction that will close by the end of this month. We acquired KRS at the same time we acquired our Performance Chemicals business back in 2014 and while it has had some strong years, mostly early on, the last several years have been a bit more challenging. KRS struggled to move up the priority list of where we wanted to deploy capital.

轉到投影片 10。7 月份，我們簽署了一項最終協議，將我們的鐵路結構業務（我們稱之為 KRS）出售給我們的一位重要客戶，並將於本月底完成現金交易。我們在 2014 年收購了 KRS，同時也收購了我們的高性能化學品業務。雖然 KRS 在某些年份（主要是早期）表現強勁，但過去幾年的挑戰更大一些。KRS 努力在我們希望部署資本的優先清單中提升排名。

And in the end, we concluded that we were probably not its best owner. I'm happy to say to Mike Tweet, who has proven to be a fabulous leader and someone I will miss that he and his team are going to be in good hands as they're joining an organization that will engage and encourage them in ways that we weren't able to at Koppers. I wish the entire KRS team the best of luck, and I thank them for their tireless efforts and commitment to the copper's culture over the past 11 years.

最後，我們得出結論，我們可能不是它的最佳主人。我很高興地告訴 Mike Tweet，他已被證明是一位出色的領導者，我會想念他，他和他的團隊將會得到很好的照顧，因為他們加入了一個組織，這個組織將以我們在 Koppers 無法做到的方式吸引和鼓勵他們。我祝福整個 KRS 團隊好運，並感謝他們在過去 11 年裡對銅文化的不懈努力和承諾。

On slide 11, as mentioned on our previous call, engaged a firm to put our entire organization under a microscope and assess how we measure up the top-performing companies in each respective area of our company from commercial to procurement to manufacturing of course, our corporate support functions. And while there are a number of things we do well, not surprisingly, there is room for improvement in just about every area.

在第 11 張投影片上，正如我們上次電話會議中提到的那樣，我們聘請了一家公司來仔細審查我們的整個組織，並評估我們如何衡量公司各個領域（從商業到採購到製造，當然還有我們的企業支援職能）中表現最好的公司。儘管我們在很多事情上做得很好，但毫不奇怪的是，幾乎每個領域都有改進的空間。

This exercise resulted in the launch of Catalyst, a strategic transformation in how we look at our business, how we value opportunities, how we unlock the brainpower across the organization. This will lead to an upgraded technology and upskilling of our team members and an improvement in our processes that ultimately leads to better execution and greater shareholder value creation. In May, I announced that Jim Sullivan will be moving from his role as Chief Operating Officer to Chief Transformation Officer to lead the Catalyst effort. In June, we kicked off the second phase of catalyst adding to the opportunities uncovered in the first phase, centering on the realistic value of opportunity to be captured in building out a detailed implementation plan that gets evaluated across the entire spectrum of opportunities and resourced according to where each initiative sits in the order of prioritization. Phase 2 will wrap up in mid-September with Phase 3 to follow soon thereafter.

這次活動促成了 Catalyst 的推出，這是我們看待業務的方式、如何評估機會的方式、如何釋放整個組織的智力的策略轉變。這將促進我們團隊成員的技術升級和技能提升，並改善我們的流程，最終實現更好的執行和更大的股東價值創造。今年 5 月，我宣布吉姆·沙利文 (Jim Sullivan) 將從首席營運長轉任首席轉型官，領導 Catalyst 工作。6 月份，我們啟動了催化劑的第二階段，在第一階段發現的機會的基礎上增加了更多內容，重點關注機會的實際價值，制定詳細的實施計劃，對整個機會範圍進行評估，並根據每個計劃的優先順序提供資源。第二階段將於 9 月中旬結束，第三階段也將隨之結束。

And while too early to announce precise numerical targets, I'm comfortable saying that we have uncovered sufficient opportunity to put us on a run rate for mid- to high-teen EBITDA margins on a sustainable basis as we exit 2027. I'm pleased with how the organization has embraced the concept of everything being on the table and the team has not shied away from making unpopular choices for the sake of the betterment of the long-term health of our company. I look forward to sharing more details on Catalyst on our next quarterly call.

雖然現在宣布精確的數字目標還為時過早，但我可以肯定地說，我們已經發現了足夠的機會，可以在 2027 年結束時以可持續的方式實現中高水平的 EBITDA 利潤率。我很高興看到公司接受了「一切都擺在桌面上」的理念，團隊為了公司長期的健康發展，毫不迴避做出不受歡迎的選擇。我期待在下次季度電話會議上分享有關 Catalyst 的更多詳細資訊。

On slide 12, we decided to postpone our Investor Day event originally scheduled for September 2025. This decision was made based on two primary factors: first, it goes without saying that there continues to be a tremendous amount of uncertainty in the global economy, which is having impacts on the markets we serve. We felt it would benefit us and our audience to give a little more time for things to hopefully settle down before going into depth on our long-range plans and targets. Second, we launched Catalyst at the beginning of this year.

在第 12 張投影片上，我們決定延後原定於 2025 年 9 月舉行的投資者日活動。這項決定基於兩個主要因素：首先，毋庸置疑，全球經濟仍存在巨大的不確定性，這對我們服務的市場產生了影響。我們認為，在深入討論我們的長期計劃和目標之前，給我們多一點時間讓事情安定下來，對我們和我們的觀眾都有好處。第二，我們在今年年初推出了Catalyst。

And as we've gotten deeper into understanding the opportunity and the time and resources that would be needed to stand it up, we thought it would be wise to take the time to be thoughtful on how it gets worked into our overall plan. In the final analysis, it didn't make sense for us to rush to a September 2025 date and felt like we would have a better quality plan and story if we demonstrated a little bit of patience. We've not settled upon a date yet, but we'll share the specifics once that decision has been made.

隨著我們對這一機會以及實現這一機會所需的時間和資源的了解越來越深入，我們認為花時間認真考慮如何將其融入我們的整體計劃是明智之舉。歸根結底，我們沒有必要急於在 2025 年 9 月之前完成，如果我們能表現出一點耐心，我們就會有一個更好的計劃和故事。我們尚未確定日期，但一旦做出決定，我們將分享具體細節。

I'll now turn the discussion over to our Chief Financial Officer, Jimmi Sue Smith.

現在我將討論交給我們的財務長 Jimmi Sue Smith。

Thanks, Leroy. Earlier today, we issued a press release detailing our second quarter 2025 results. My comments today are based on that information. As seen on slide 14, we had consolidated second quarter sales of $505 million, down 10.4% from the prior year. By segment, RUPS sales decreased by $4 million or 1%.

謝謝，Leroy。今天早些時候，我們發布了一份新聞稿，詳細介紹了我們 2025 年第二季的業績。我今天的評論就是基於這些資訊。如投影片 14 所示，我們第二季的綜合銷售額為 5.05 億美元，比上年下降 10.4%。按部門劃分，RUPS 銷售額下降了 400 萬美元，即 1%。

PC sales were down by $26 million, 15% and CM&C sales decreased by $28 million or 22% compared with the prior year quarter. On Slide 15, adjusted EBITDA for the second quarter was $77 million with a 15.3% margin. By segment, RUPS generated adjusted EBITDA of $32 million with a 12.6% margin. PC delivered adjusted EBITDA of $29 million and a 19% margin, while CM&C reported adjusted EBITDA of $17 million with a 16.2% margin. On Slide 16, our RUPS business generated second quarter sales of $250 million compared with $254 million in the prior year.

與去年同期相比，個人電腦銷售額下降 2,600 萬美元，降幅 15%，CM&C 銷售額下降 2,800 萬美元，降幅 22%。在第 15 張投影片上，第二季的調整後 EBITDA 為 7,700 萬美元，利潤率為 15.3%。按部門劃分，RUPS 的調整後 EBITDA 為 3,200 萬美元，利潤率為 12.6%。PC 的調整後 EBITDA 為 2,900 萬美元，利潤率為 19%，而 CM&C 的調整後 EBITDA 為 1,700 萬美元，利潤率為 16.2%。在投影片 16 上，我們的 RUPS 業務第二季的銷售額為 2.5 億美元，而去年同期為 2.54 億美元。

Lower volumes of Class 1 crossties and lower crosstie recovery activity contributed to this decrease, partly offset by higher commercial crosstie volumes, price increases for crossties and increased activity in our railroad bridge services business. Untreated cost time market prices remained stable compared to last year. Crosstie procurement was down 13%, while crosstie treatment was down 1%. RUPS also delivered adjusted EBITDA of $32 million compared with $22 million in the prior year. Profitability improved due primarily to $7.7 million of lower costs from raw materials, SG&A and freight along with net sales price increases.

一級枕木產量下降和枕木回收活動減少是造成這一下降的原因，但商業枕木產量增加、枕木價格上漲和鐵路橋樑服務業務活動增加部分抵消了這一下降。未經處理的成本時間市場價格與去年相比保持穩定。枕木採購量下降了 13%，枕木處理量下降了 1%。RUPS 的調整後 EBITDA 也達到 3,200 萬美元，而去年同期為 2,200 萬美元。獲利能力提高主要由於原材料、銷售、一般及行政費用和運費成本降低 770 萬美元以及淨銷售價格上漲。

On slide 17, our Performance Chemicals business reported second quarter sales of $151 million compared to $177 million in the prior year. We experienced a 15% volume decrease, mostly in the Americas from previously discussed market share shifts in the US Adjusted EBITDA for PC came in at $29 million compared to $44 million in the prior year. Profitability was unfavorably impacted by higher raw material costs and lower sales volumes, partly offset by $2.2 million in lower SG&A expenses, lower operating costs and higher royalty income. Slide 18 shows second quarter CM&C sales of $104 million compared to $132 million in the prior year.

在第 17 張投影片上，我們的高效能化學品業務報告第二季銷售額為 1.51 億美元，而去年同期為 1.77 億美元。我們的銷售量下降了 15%，主要是在美洲，這與先前討論過的美國市佔率變化有關，個人電腦的調整後 EBITDA 為 2,900 萬美元，而前一年為 4,400 萬美元。原材料成本上升和銷售量下降對盈利能力產生了不利影響，但銷售、一般和行政費用下降 220 萬美元、營運成本下降和特許權使用費收入增加部分抵消了這一影響。投影片 18 顯示，第二季 CM&C 銷售額為 1.04 億美元，去年同期為 1.32 億美元。

This decrease was driven by approximately $20 million of lower volumes of phthalic anhydride as that product has been discontinued as well as lower volumes of carbon black feedstock and lower sales prices for carbon pitch, which were down 6% globally as a result of market dynamics, primarily in Australasia. These factors were partly offset by volume increases for refined tar, nasolene and creosote and $1.8 million in favorable foreign currency impact. Adjusted EBITDA for CM&C in the second quarter was $17 million compared with $11 million in the prior year. This improvement in profitability was due to $11.5 million of lower raw materials, SG&A and operating expenses particularly in North America and a favorable sales mix, partly offset by price decreases and lower utilization from ceasing phthalic anhydride production. Sequentially, the average pricing of major products decreased by 2% and average coal tar costs were higher by 4%.

造成這一下降的原因包括：鄰苯二甲酸酐產量減少約 2,000 萬美元（因為該產品已停產），以及炭黑原料產量減少和炭瀝青銷售價格下降，受市場動態影響（主要是在澳洲），全球炭瀝青銷售價格下降了 6%。這些因素被精煉焦油、萘酚和雜酚油產量的增加以及 180 萬美元的有利外匯影響部分抵消。CM&C 第二季調整後的 EBITDA 為 1,700 萬美元，去年同期為 1,100 萬美元。獲利能力的提高是由於原材料、銷售、一般及行政費用和營運費用（尤其是在北美）降低了 1,150 萬美元，以及銷售組合有利，但價格下降和停止鄰苯二甲酸酐生產導致的利用率降低部分抵消了這一影響。季比，主要產品平均價格下降2%，煤焦油平均成本上升4%。

Compared to the prior year quarter, the average pricing of major products was lower by 7% and while average coal tar costs decreased by 1%. As shown on Slide 20, we continue to pursue a balanced approach to capital allocation. Net of cash received from insurance proceeds and asset sales, we invested $21.7 million into our business through June 30. We are reducing our CapEx guidance for full year 2025 to be in the range of $52 million to $58 million. A significant reduction from $77 million -- $74 million last year, reflecting our commitment to increasing free cash flow.

與去年同期相比，主要產品平均價格下降7%，煤焦油平均成本下降1%。如投影片 20 所示，我們繼續推行平衡的資本配置方法。扣除保險收益和資產出售所收到的現金，截至 6 月 30 日，我們已向我們的業務投資 2,170 萬美元。我們將 2025 年全年的資本支出預期下調至 5,200 萬美元至 5,800 萬美元之間。與去年的 7,700 萬美元（7,400 萬美元）相比大幅減少，反映了我們致力於增加自由現金流的承諾。

Year-to-date, we have invested $29 million in share buybacks, including shares withheld for taxes. We have approximately $75 million remaining on our $100 million repurchase authorization. We also returned capital to shareholders through our quarterly dividend of $0.08 per share. And we ended the quarter with $929 million of net debt, approximately $20 million lower than March 31, reflecting our commitment to putting a significant portion of our free cash flow toward debt reduction this year and progress toward our continued long-term target of 2 to 3 times net leverage ratio. We ended the quarter with a net leverage of 3.5x and $336 million in available liquidity.

年初至今，我們已投資 2,900 萬美元用於股票回購，其中包括扣繳稅款的股票。我們的 1 億美元回購授權還剩餘約 7,500 萬美元。我們也透過每股 0.08 美元的季度股利向股東返還資本。本季末我們的淨債務為 9.29 億美元，比 3 月 31 日減少了約 2,000 萬美元，這反映了我們致力於將今年自由現金流的很大一部分用於減少債務，並朝著持續 2 至 3 倍淨槓桿率的長期目標邁進。本季末，我們的淨槓桿率為 3.5 倍，可用流動資金為 3.36 億美元。

On slide 21, during this quarter, we successfully extended the maturity date of our $800 million revolving credit facility to at least January 9 of 2030. We are very pleased with the extension, which also removes certain step-downs in our permitted leverage ratio and lowered the pricing tiers for certain borrowings. We continue to appreciate the ongoing support of our wonderful banking partners as we advance our strategic priorities. You can use the QR code on this slide for more information.

在第 21 張投影片上，在本季度，我們成功將 8 億美元循環信貸額度的到期日延長至至少 2030 年 1 月 9 日。我們對此次延期感到非常高興，這也取消了我們允許的槓桿率的某些下降，並降低了某些借款的定價等級。在我們推動策略重點的過程中，我們持續感謝我們優秀的銀行合作夥伴的持續支持。您可以使用此投影片上的二維碼來取得更多資訊。

On slide 22, total capital expenditures for the second quarter were $26.4 million growth or $21.7 million net. We spent $22.5 million on maintenance, nearly $2 million on Zero Harm and $2 million on growth and productivity projects. By business segment, we spent $9.3 million in RUP, $5.9 million in PC, $10.2 million in CM&C and $1 million on corporate projects.

在投影片 22 上，第二季的總資本支出成長 2,640 萬美元或淨成長 2,170 萬美元。我們花了 2250 萬美元用於維護，近 200 萬美元用於零傷害項目，200 萬美元用於成長和生產力項目。按業務部門劃分，我們在 RUP 上花費了 930 萬美元，在 PC 上花費了 590 萬美元，在 CM&C 上花費了 1020 萬美元，在企業項目上花費了 100 萬美元。

And finally, on slide 24, our Board of Directors declared a quarterly dividend of $0.08 per share of Koppers common stock on August 7. The dividend will be paid on September 15 to shareholders of record as of the close of trading on August 29. At this (inaudible) quarterly dividend rate, which is subject to review by the Board of Directors, the annual cash dividend is expected to be $0.32 per share for 2025, a 14% increase over the 2024 dividend.

最後，在第 24 張投影片上，我們的董事會於 8 月 7 日宣布，Koppers 普通股的季度股息為每股 0.08 美元。股利將於 9 月 15 日支付給 8 月 29 日收盤時登記在冊的股東。以此（聽不清楚）季度股息率（需經董事會審查），預計 2025 年年度現金股利為每股 0.32 美元，比 2024 年股利增加 14%。

And with that, I'll turn it back over to Leroy.

說完這些，我將把麥克風交還給 Leroy。

Thank you, Jimmi Sue. So now on to a quick review of each of the businesses, starting with our Performance Chemicals, or PC business on page 26. As Jimmi Sue noted, we finished the second quarter with adjusted EBITDA and PC of just under $29 million, which equates to a respectable 19% margin. While that doesn't come close to measuring up against last year's monster second quarter, it's actually a respectable result in the context of the current state of the housing, repair and remodeling and industrial markets we serve, which all continue to be stagnant. We see some signs of life on the industrial side, however, which I'll speak to shortly in my UIP commentary.

謝謝你，吉米·蘇。現在讓我們快速回顧一下每項業務，首先從第 26 頁的高效能化學品或 PC 業務開始。正如 Jimmi Sue 所指出的，我們第二季的調整後 EBITDA 和 PC 略低於 2,900 萬美元，相當於可觀的 19% 的利潤率。雖然這與去年第二季度的強勁表現相去甚遠，但考慮到我們所服務的住房、維修和改造以及工業市場的現狀，這實際上是一個可觀的成績，這些市場仍然處於停滯狀態。然而，我們看到工業方面出現了一些復甦跡象，我將在 UIP 評論中簡要地談到這一點。

If you strip away the market share loss experienced this year, our volumes are lower from prior year by about 2%. That's down from of tepid sales activity. As things currently stand, we are not seeing or hearing anything that would indicate that second half volumes will look any different than what we've seen for most of this year. The external data continues to paint an uninspiring picture in the near term as drivers for treated products like existing home sales, new home starts and repair remodeling indices all seem stuck in neutral and our customer base is now looking towards 2026 for signs of improvement. As we forecasted last quarter, we managed to fend off most of the impact of higher tariffs so far.

如果除去今年的市佔率損失，我們的銷售量比去年下降了約 2%。這是由於銷售活動不溫不火造成的。就目前情況而言，我們沒有看到或聽到任何跡象表明下半年的銷售將與今年大部分時間的銷售量有任何不同。外部數據在短期內繼續描繪出一幅令人沮喪的景象，因為現有房屋銷售、新屋開工和維修改造指數等受處理產品的驅動因素似乎都處於中性狀態，我們的客戶群現在期待著 2026 年出現改善的跡象。正如我們上個季度預測的那樣，到目前為止，我們成功抵禦了大部分關稅上調的影響。

The only quantifiable impact to date is the threatened and now actual Kopper tariff. This has caused the separation between the Comex and LME exchanges, resulting in approximately $2 million of hedge ineffectiveness hitting our results in Q2. Between some additional hedge ineffectiveness and some direct tariff impact currently sitting in inventory, we expect about $5 million of impact from tariffs in the back half of the year, now reflected in our revised guidance. In addition, expected continued softness in our residential preservative business and a higher-than-expected impact from our lower operating leverage resulting from overall volume loss will have an additional impact on results in the back half of the year. Moving on to our Utility and Industrial Products business shown on page 27.

迄今為止唯一可量化的影響是威脅實施的、現已實際實施的科珀關稅。這導致了 Comex 和 LME 交易所的分離，導致第二季度約 200 萬美元的對沖無效損失，影響了我們的業績。在一些額外的對沖無效性和目前庫存中的一些直接關稅影響之間，我們預計今年下半年關稅的影響約為 500 萬美元，這已反映在我們修訂後的指引中。此外，預計我們的住宅防腐劑業務將持續疲軟，而由於整體銷售損失導致的較低營運槓桿的影響高於預期，將對下半年的業績產生額外的影響。接下來介紹第 27 頁所示的公用事業和工業產品業務。

We're starting to see what we hope is the beginning of the market pick up that the industry has been forecasting for the back half of this year. When you look at the details of what appears to be an ordinary performance for UIP in the second quarter, our comparative volumes actually increased by a little bit for just the second time in the last seven quarters and seem to be picking up even more momentum as we enter the third quarter. The sales improvement was led by our Brown Wood acquisition from last year, which saw a 24% increase, while our legacy sites were off by about 5%. During the second quarter, we started to see the backlog of rate increase requests to state public utility commissions begin to break free with more than double the amount of rate increases approved from quarter 2 of 2024. These much-needed increases provide a positive indicator for pull demand expectations.

我們開始看到我們所希望的市場回升的開始，正如業界所預測的，今年下半年市場將開始回升。當您查看 UIP 在第二季度看似普通的表現細節時，我們的比較交易量實際上略有增加，這是過去七個季度以來的第二次增加，而且隨著我們進入第三季度，這種增長勢頭似乎正在進一步增強。銷售額的成長主要得益於我們去年收購的 Brown Wood，其銷售額成長了 24%，而我們原有的工廠銷售額則下降了約 5%。在第二季度，我們開始看到向州公用事業委員會提出的加價請求積壓的情況開始好轉，批准的加價數量是 2024 年第二季度的兩倍多。這些急需的成長為拉動需求預期提供了一個正面的指標。

And we remain bullish on the utility for market through 2030 as mega trends such as electrification and grid hardening, complement the general need to replace aging infrastructure. On a final note, we continue to invest in resources to grow our business outside our traditional stronghold in the Eastern US and are beginning to experience some small wins on which we intend to build. Our Railroad Products and Services business is summarized on page 28. Treated sales volumes and improvements in pricing, combined with lower operating costs pushed our Q2 crosstie profitability to its highest point since the second quarter of 2016.

隨著電氣化和電網強化等大趨勢滿足更換老化基礎設施的普遍需求，我們仍然看好 2030 年之前的公用事業市場。最後要說的是，我們將繼續投入資源，在美國東部傳統據點之外拓展業務，並開始取得一些小勝利，我們打算在此基礎上繼續發展。我們的鐵路產品和服務業務總結在第 28 頁。經過處理的銷售量和定價的改善，加上較低的營運成本，使我們第二季的枕木獲利能力達到了自 2016 年第二季以來的最高點。

This was the primary driver to our RUPS segment reaching a new quarterly high. Despite treated sales volumes being up for the first half of the year, the improvement is still tracking well behind the 8% year-over-year increase we had forecast based upon customer communication heading into this year. As a result, we're modifying our forecast for treated sales improvement to 4% for the year, close to what we've been tracking for, for the first 6 months. Our business mix will shift unfavorably in the second half and the year-over-year improvement we've seen in our cost will face tougher comps in the second half, making the first half tough to replicate. Our shift away from the disposal part of our crosstie recovery model continues to be justified by more consistently positive results.

這是我們的 RUPS 部門創下季度新高的主要驅動力。儘管今年上半年處理後的銷售量有所上升，但增幅仍遠低於我們根據今年與客戶的溝通狀況所預測的 8% 的同比增長率。因此，我們將全年治療產品銷售額成長預測修改為 4%，接近我們追蹤的前 6 個月的成長率。我們的業務組合將在下半年發生不利變化，而我們成本同比改善的情況將在下半年面臨更嚴峻的競爭，使得上半年的業績難以複製。我們不再依賴枕木回收模式中的處置部分，這繼續被更持續的正面成果所證明。

Our overall maintenance of (inaudible) business added $2 million of improvement for the second quarter compared to prior year, but we will not have our Railroad Structures business beginning in September. We recently signed a definitive agreement to sell the KRS business, as I've previously mentioned, to one of our contracted customers where it makes for a better fit. Despite the great year, our RUPS business has had through the first six months, we are revising our guidance down for this segment for the year. This is because we don't expect crosstie volumes to improve from their current pace. And while our UIP business will see an improved second half, we are tempering our expectations a bit regarding the pace of improvement.

與去年同期相比，我們第二季的整體維護（聽不清楚）業務增加了 200 萬美元，但我們的鐵路結構業務將從 9 月開始停止。正如我之前提到的，我們最近簽署了一項最終協議，將 KRS 業務出售給我們的一位簽約客戶，這樣更適合。儘管今年前六個月我們的 RUPS 業務表現優異，但我們仍下調了今年該部門的業績預期。這是因為我們預期枕木運輸量不會以目前的速度增加。雖然我們的 UIP 業務在下半年會有所改善，但我們對改善速度的預期有所降低。

Next, on to the CM&C business, summarized on page 29. CM&C continued its recent trend of improved performance, posting its fourth straight quarter of year-over-year improvement despite most of our customer base still dealing with their own challenges around demand and trade. Our sales comparison is challenged even more, of course, with the shutdown of our phthalic anhydride business with little replacement thus far for naphthalene cells. We seize production of phthalic in April, a month earlier than planned, and the initial cost benefits look even better than modeled. We still see opportunity to improve our cost structure further at our site in Stickney, Illinois and have a number of catalyst initiatives in progress to get operating costs where we need them to be.

接下來，討論 CM&C 業務，總結在第 29 頁。CM&C 延續了近期業績改善的趨勢，儘管我們的大多數客戶群仍在應對自身在需求和貿易方面的挑戰，但其業績仍連續第四個季度實現同比增長。當然，由於我們的鄰苯二甲酸酐業務關閉，而且到目前為止萘電池的替代品很少，我們的銷售額對比面臨更大的挑戰。我們在四月開始生產鄰苯二甲酸，比計劃提前了一個月，而且初始成本效益看起來甚至比模型的還要好。我們仍然看到在伊利諾伊州斯蒂克尼工廠進一步改善成本結構的機會，並且正在實施一些催化舉措，以使營運成本達到我們需要的水平。

In parallel, we've been working hard behind the scenes to secure our major coal tar contracts in each region and stabilize pricing. Coal tar is the raw material that ultimately underpins the long-term health of each of our sites and without stable supply at a reasonable price point, our business can't survive. I reported last quarter that we had locked in a significant chunk of our Australian supply into the future, and I'm happy to say that we recently did the same in Europe. The future of Stickney will depend upon the same, and I hope to be reporting similar news to that effect in the coming quarters. On the spot purchase side, tar markets have been moving in our favor in Europe and Australia, which also helps our recent run of improvement.

同時，我們一直在幕後努力工作，以確保我們在各個地區的主要煤焦油合約並穩定價格。煤焦油是我們每個工廠長期健康發展的最終基礎原料，如果沒有合理價格的穩定供應，我們的業務就無法生存。我上個季度報告稱，我們已經鎖定了未來澳洲的很大一部分供應，我很高興地說，我們最近在歐洲也做了同樣的事情。Stickney 的未來將取決於此，我希望在未來幾季報道類似的消息。在現貨採購方面，歐洲和澳洲的焦油市場走勢對我們有利，這也有助於我們近期的改善。

Finally, as I said on our prior call in May, the coal tar distillation industry could really use some rationalization of capacity. We believe others who participate in our markets are struggling even more than us over the past couple of years. And in the long run, that's unsustainable. In the meantime, we're positioning ourselves as a healthy long-term alternative partner for suppliers and customers to ensure a much needed outlet for their tar and for supply of their critical raw material.

最後，正如我在 5 月的電話會議上所說，煤焦油蒸餾產業確實需要進行一些產能合理化。我們相信，在過去幾年裡，參與我們市場的其他公司面臨的困境比我們更大。從長遠來看，這是不可持續的。同時，我們將自己定位為供應商和客戶的健康的長期替代合作夥伴，以確保他們的焦油有急需的出口，並供應關鍵的原材料。

Moving on to our outlook for 2025, as shown on slide 31. We're now reducing our consolidated sales guidance to be $1.9 billion to $2 billion in 2025 compared with $2.1 billion in 2024. This reduction reflects an assumption that the demand environment does not change materially from what we've experienced through these first 6 months.

繼續我們對 2025 年的展望，如幻燈片 31 所示。我們現在將綜合銷售額預期從 2024 年的 21 億美元下調至 2025 年的 19 億美元至 20 億美元。這一減少反映了這樣一種假設，即需求環境與我們前六個月所經歷的情況相比不會發生重大變化。

On slide 32, we're revising our adjusted EBITDA forecast down to be in the range of $250 million to $270 million compared with $262 million in 2024. Now if we just match our first half, we'll be at about $265 million for the year, which sounds reasonable. But we did mention that we expect an additional $3 million of tariff impact over the first half and we will not have $2 million of contribution from KRS that we had in the first half, as it had an ordinary strong first half of the year.

在第 32 張投影片上，我們將調整後的 EBITDA 預測下調至 2.5 億美元至 2.7 億美元之間，而 2024 年為 2.62 億美元。現在，如果我們的銷售額與上半年持平，那麼全年的銷售額將達到約 2.65 億美元，這聽起來很合理。但我們確實提到，我們預計上半年關稅影響將增加 300 萬美元，而且我們將不會獲得 KRS 在上半年貢獻的 200 萬美元，因為 KRS 在上半年表現強勁。

That would put us at the midpoint of $260 million. Additional Catalyst benefits over and above the run rate and an accelerated pickup in demand in our UIP business or higher demand in any of our businesses for that matter, would push us closer to $270 million and maybe even beyond. A combination of limited additional catalyst benefits, additional tariff impact and further pullback in demand, however, would push us closer to $250 million. Additionally, Catalyst has uncovered some opportunity to reduce inventory levels for cash given the softer demand thus far this year, but it would result in less fixed cost absorption at the plants, which, of course, would also impact EBITDA. Pulling our guidance down to a more conservative range provides flexibility for us to make that choice and still meet the revised guidance.

這將使我們達到 2.6 億美元的中間值。除了運行率之外的額外 Catalyst 收益以及我們 UIP 業務需求的加速增長或任何業務需求的增加，將使我們的營收更接近 2.7 億美元，甚至可能更高。然而，有限的額外催化劑效益、額外的關稅影響以及需求的進一步回落將使我們的目標更接近 2.5 億美元。此外，鑑於今年迄今需求疲軟，Catalyst 發現了一些降低庫存水準以獲取現金的機會，但這將導致工廠的固定成本吸收減少，當然也會影響 EBITDA。將我們的指導下調至更保守的範圍為我們提供了靈活性，可以做出選擇，同時仍然滿足修訂後的指導。

Slide 33 shows our 2025 adjusted earnings per share bridge and the improvement we expect in 2025 driven by higher operating earnings and lower interest expense. We're expecting $4 to $4.60 per share in 2025, which represents a 5% increase at the midpoint compared with $4.11 in 2024.

投影片 33 展示了我們 2025 年調整後的每股盈餘橋，以及我們預計在 2025 年將因營業收益增加和利息支出減少而出現的改善。我們預計 2025 年每股收益為 4 美元至 4.60 美元，與 2024 年的 4.11 美元相比，中位數成長 5%。

As it relates to EPS, unfortunately, all the benefit of our lower interest costs and lower share count is getting washed away and a higher expected effective tax rate due to an unfavorable geographic mix of earnings. On Slide 34, we're now projecting capital spending for the year to fall between $52 million and $58 million compared with $74 million in 2024. And while we've not changed our operating cash flow target of $150 million for the year, I'm fairly confident at this point that we will beat that number. At the modest amount of cash we will receive upon the sale of KRS, and we will have enough free cash flow to pay down a healthy amount of debt for the year. While I'm disappointed to reduce our expectations for the year, don't want to lose sight that despite softer-than-expected end markets, we are still projecting adjusted EPS improvement, one of our better margin years ever, our best cash flow year ever, reduced debt and leverage and a detailed road map to take the performance and results of the company to another level.

就每股盈餘而言，不幸的是，由於不利的地域收益組合，我們較低的利息成本和較低的股票數量帶來的所有好處都被沖走了，而且預期有效稅率也更高。在第 34 張投影片上，我們目前預測今年的資本支出將下降到 5,200 萬美元至 5,800 萬美元之間，而 2024 年則為 7,400 萬美元。雖然我們沒有改變今年 1.5 億美元的營運現金流目標，但我現在很有信心我們會超過這個數字。出售 KRS 後我們將獲得適量的現金，我們將擁有足夠的自由現金流來償還今年的大量債務。雖然我很遺憾降低我們對今年的預期，但不要忽視，儘管終端市場弱於預期，我們仍然預計調整後的每股收益將有所改善，這是我們有史以來利潤率最高的一年，也是我們有史以來最好的現金流年份，債務和槓桿率將減少，並且有詳細的路線圖將公司的業績和結果提升到另一個水平。

We have set ourselves up for a breakout performance, and it feels like we are close to a tipping point to set it in motion. I've never been more positive in the path we're on, and I appreciate our shareholders' patience and support. I would now like to open it up for questions.

我們已經為突破性的表現做好了準備，感覺我們已經接近啟動它的臨界點。我對我們所走的道路從未如此樂觀，我感謝股東的耐心和支持。現在我想開始回答大家的提問。

(Operator Instructions) Liam Burke, B. Riley.

（操作員指示） Liam Burke、B. Riley。

Leroy, on RUPS, how have the contracts with the Class 1 customer has been going? Are you satisfied that you've got agreements that are in place that are satisfactory for you guys?

Leroy，關於 RUPS，與 1 級客戶的合約進度如何？你們對已經達成的令你們滿意的協議感到滿意嗎？

Well, I mean, so they are long-term contracts, and they have varying expiration dates on them. Some, again, still have several years. I'd say you can again look at our improved results and there's two ways to go, obviously, pricing. And then the cost side of the equation, as I had mentioned in prior calls, we had a heavy push to try and recover a lot of the cost increase we had seen from -- I'd say, the '22 in through mid-'24 time frames. And I think we've maximized all we are going to be able to do at this point on that until we have some contracts expiring.

嗯，我的意思是，它們是長期合同，並且有不同的到期日。有些人還需要幾年的時間。我想說，你可以再看看我們改進的結果，顯然有兩種方法可以實現，那就是定價。然後，在成本方面，正如我在之前的電話會議中提到的那樣，我們竭盡全力試圖收回從 2022 年到 2024 年中期這段時間以來出現的大部分成本增長。我認為，我們已經盡了最大努力，直到一些合約到期。

The last year, we've been heavily focused on trying to push the cost side of the equation down. And I think the results show that we've been somewhat successful from that standpoint. The third piece of it is volume. And they are -- the sites -- they're heavily fixed cost oriented. So when you don't get the throughput into the plants, that has an impact.

去年，我們一直致力於降低成本。我認為結果表明，從這個角度來看，我們已經取得了一定的成功。第三部分是數量。這些站點很大程度上是以固定成本為導向的。因此，當工廠的產量不足時，就會產生影響。

And so, as we look at this year and our expectations -- and again, this is going to be a great year for RUPS. I think we're going to finish the year in double-digit margin territory, which we haven't for quite some time. And again, we're showing that over the past several quarters in terms of the significant improvement. But it could be even better if we have -- we're experiencing the volume increases that were forecast to us at the end of last year heading into this year as we were planning out our production schedule. So that's a disappointment.

因此，當我們回顧今年並展望我們的期望時——對於 RUPS 來說，這將是偉大的一年。我認為我們今年的利潤率將達到兩位數，而我們已經有很長一段時間沒有實現這個目標了。我們再次證明，過去幾季我們已經取得了顯著的進步。但如果我們能夠做到的話，情況可能會更好——我們在規劃生產計畫時，正在經歷去年年底預測的產量成長。這真令人失望。

I mean overall, the numbers will -- the volume numbers will still be up for the year. They just won't be up by as much as they were signaling. Now that gives me hope that all that does is push that into '26, and maybe we'll see even higher volumes in '26. But we won't know that until we get out to next year. And I think, again, one of the lessons from the last couple of years is to, I think, put some level of conservatism into what we're being told because it's now become two years running that we have been signaled that the volumes will be higher, and then for varying reasons, our customer base have pulled back once they got out sort of to the midyear point.

我的意思是，總體而言，今年的數字——交易量數字仍將上升。它們只是不會像它們所發出的信號那樣上漲。現在，這讓我充滿希望，這一切都將推動 26 年的銷售成長，也許我們會在 26 年看到更高的銷售量。但我們要等到明年才能知道。我認為，過去幾年的教訓之一就是，我認為，對我們被告知的事情要採取一定程度的保守態度，因為現在已經連續兩年我們得到信號說交易量將會更高，然後由於各種原因，我們的客戶群在到達年中點後就回落了。

Great. On PC, the residential side of the business, you kind of -- we know about market share losses. We also know about the existing home sales. So that's sort of working its way through, and you're still holding high-teens margins. On the industrial side, you're showing some life there.

偉大的。在個人電腦方面，即業務的住宅方面，我們知道市場份額的損失。我們也了解現有房屋銷售情況。因此，這在某種程度上正在發揮作用，並且您仍然保持著高十幾個百分點的利潤率。在工業方面，你在那裡表現出了一些活力。

Could you tell -- give us me a sense as to how much follow-through you'd expect from that part of the business?

您能否告訴我們—讓我們了解一下您對該部分業務的後續進展有何期望？

Yes. We are seeing some life there, and that's a positive. The life there will show up in a greater way in the UIP piece of the business. The industrial preservative side of PC is not what really drives the business and the results there. It is more on the residential side.

是的。我們在那裡看到了一些生機，這是積極的。那裡的生活將在 UIP 業務部分以更精彩的方式展現出來。PC 的工業防腐作用並不是真正推動其業務和成果的因素。它更多是在住宅方面。

Obviously, it will be additive of we can see that volume pick up because, again, it will increase the throughput at our plants and obviously result in higher volumes and higher sales. But for us to see a meaningful movement on the PC side in terms of results moving back, we've got to see some pickup on the residential side. And 2% down, all things being told is -- it's not awful. But again, coming into the year, I think there was a little more enthusiasm around seeing at least a couple percent uptick. And then when you're talking about a 4% overall difference going from a couple of percent up to a couple of percent down, that, again, over the course of the year, can have a meaningful impact.

顯然，如果我們看到產量增加，這將是有益的，因為這將再次增加我們工廠的產量，顯然會帶來更高的產量和更高的銷售。但要看到 PC 端業績出現有意義的回升，我們必須看到住宅端業績回升。下降 2%，總的來說，這並不可怕。但是，進入今年以來，我認為人們對於至少幾個百分點的上漲會更加熱情。然後，當您談論 4% 的總體差異從幾個百分點上升到幾個百分點下降時，在一年的時間裡，這可能會產生重大影響。

So the good news is -- I think we all believe this is something that's temporary and we'll start to see an uptick at some point. Right now, I think folks are looking out into in terms of that optimism. So I think we've all resigned ourselves to the fact that the back half of the year is probably not going to look much different from an overall demand standpoint than the front half.

所以好消息是——我想我們都相信這只是暫時的，我們將在某個時候開始看到好轉。現在，我認為人們正在以這種樂觀的態度看待問題。因此，我認為我們都已經接受了這樣一個事實：從整體需求的角度來看，下半年與上半年可能不會有太大區別。

Gary Prestopino, Barrington Research.

巴林頓研究公司的加里‧普雷斯托皮諾 (Gary Prestopino)。

Leroy, getting to this catalyst was -- well, I don't know what I want to call it a restructuring or whatever. Was any of this -- this is something new that's coming to the fold, right, beyond what you were doing with your strategic transformation on the five-year plan. Is that kind of correct?

Leroy，得到這個催化劑是──嗯，我不知道該怎麼稱呼它為重組還是其他什麼。這是不是說——這是正在出現的新事物，超越了你們在五年計畫中所做的策略轉型。這樣做對嗎？

Yes, it's coming in, I'd say, to help underpin and really support the plan on a -- structurally on an ongoing basis. So it really applies a different lens to how we approach the generation of opportunities in the organization, how we evaluate them, how we measure them, how we plan for them, track them. It really is a change management process that will unlock opportunities. And we've already seen it unlock opportunities that that are going to be meaningful in terms of, I think, leading us to a sustainable improvement in performance. And where I would contrast it to other, if you will, cost saving initiatives that we would have done in the past or others would have done in the past.

是的，我想說，它將有助於在結構上持續鞏固和真正支持該計劃。因此，它確實從不同的角度看待我們如何處理組織中的機會的產生、如何評估它們、如何衡量它們、如何規劃它們、如何追蹤它們。這確實是一個能夠釋放機會的變革管理過程。我們已經看到它釋放出一些機會，我認為這些機會將具有重大意義，可以引領我們實現業績的可持續改善。如果您願意的話，我會將其與我們過去或其他人過去採取的其他成本節約舉措進行比較。

In many cases, those initiatives, you're kind of taking a little bit of a brute force approach and you're slashing somewhat indiscriminately and you take the pain for a period of time. Those costs sort of work their way back because they need to because you haven't been thoughtful about the approach that's been taken in terms of how you've trimmed it. And -- this is really about changing the process and making those changes sustainable. So improving technology, improving the skill sets of individuals across the organization to enable us to be able to effectively do more with less. And again, have it be something that we can carry on as opposed to -- you do it for a temporary time frame.

在許多情況下，這些舉措都採取了類似蠻力的方式，不加區分地進行削減，並在一段時間內承受痛苦。這些成本會逐漸回升，因為它們需要這樣做，因為你還沒有仔細考慮削減成本的方法。這實際上是為了改變流程並使這些改變可持續。因此，改進技術，提高整個組織中個人的技能，使我們能夠有效地用更少的資源做更多的事情。再說一次，讓它成為我們可以繼續做的事情，而不是──你在暫時的時間內做這件事。

And then three years later, you look back and everything that you cut right back there again. And so -- so it is an important part of the strategy that we've been working on because it gives us a sound foundation for all the other things we want to do that can be additive to the business.

三年後，當你回首往事時，你會發現所有被刪減的內容又回到了原點。所以，這是我們一直在努力的策略的重要組成部分，因為它為我們想要做的所有其他可以增加業務的事情奠定了堅實的基礎。

Okay. And then you cited in your comments, the adjusted EBITDA margin target.

好的。然後您在評論中引用了調整後的 EBITDA 利潤率目標。

Yes.

是的。

I didn't -- I wasn't able to write that down. Can you just tell me that.

我沒有——我無法把它寫下來。你能告訴我嗎？

So it's really, it's mid- to high teens. I mean, I think I think that we absolutely can get there. I think you've seen a little actually a preview of it with this quarter. I mean we -- so we have not had a quarterly EBITDA margin above 15% since 2017. And we got there in this quarter, despite the fact that sales were down year-over-year by 10%.

所以實際上，它是十幾歲到十幾歲。我的意思是，我認為我們絕對可以實現這一目標。我想您實際上已經看到了本季的一些預覽。我的意思是——自 2017 年以來，我們的季度 EBITDA 利潤率從未超過 15%。儘管銷售額年減了 10%，我們還是在本季實現了這一目標。

And obviously, we did it through a number of cost levers. But it gives you some indication that, again, if we're successful in Catalyst, right, these are costs that should not just be coming back in as the demand picks up and goes the other way, but should be sustainable. And so imagine how that drops to the bottom line when you got more volume coming through the queue and adding to the top line. I mean it's going to -- it will be significantly impactful. And so yes, mid- to high teens margins is what we are targeting and what we believe is achievable.

顯然，我們透過多種成本手段實現了這一目標。但它再次表明，如果我們在 Catalyst 中取得成功，那麼這些成本不應該只是隨著需求的回升而回落，而應該是可持續的。因此，想像一下，當佇列中有更多的資料量進入並增加到頂線時，該資料量將如何下降到底線。我的意思是它將會——它會產生重大影響。是的，中高水準的利潤率是我們的目標，也是我們相信可以實現的。

Okay. And then just kind of looking at going through your narrative and roll out, it seems that the PC business definitely relative to where you were when you gave guidance at the end of Q1, the PC business has continued to slip --

好的。然後，從你的敘述和部署來看，個人電腦業務似乎肯定與你在第一季末給出指導時的情況有關，個人電腦業務一直在下滑。--

Yes.

是的。

And it looks like the railroad business, the rebound you were looking for is not coming back. It's not going to be there for the back half of the year. Is that kind of a good summation?

看起來，鐵路產業，你所期待的反彈不會再出現了。今年下半年它不會再出現了。這是一個很好的總結嗎？

Well, look, the railroad business is still going to have a great year. It's had a great first half. It's going to have a great year. I'd say, yes, we don't think that the back half of the year, there's risk in the back half of the year in terms of it being as strong. We don't think the volumes are going to drop off a bit, but we are going to get impacted a little bit in terms of product and customer mix.

嗯，看，鐵路業務仍然會迎來輝煌的一年。上半場表現非常出色。這將會是美好的一年。我想說，是的，我們認為下半年不會有那麼強勁的風險。我們認為銷售量不會下降，但在產品和客戶結構方面我們會受到一點影響。

We -- again, we may decide that we want to turn some inventory into cash because, again, the volumes aren't now projected as that strong of levels as what we had thought coming in. And if we do that, right, we're going to take some absorption hit, which would have an impact. Again, that's a discretionary call as to whether we want to do that or not, but we wanted to give ourselves a little bit of room there. So -- the -- I want to just caution RUPS is going to have a very good year. If it doesn't quite reach where we had originally forecast at the beginning of the year, I would not deem that a failure.

我們——再一次，我們可能會決定將部分庫存轉換為現金，因為現在預計的庫存量並不像我們想像的那麼高。如果我們這樣做，那麼，我們就會受到一些吸收打擊，這會產生影響。再次強調，我們是否願意這樣做取決於我們的判斷，但我們希望為自己留一點空間。所以 — — 我只想提醒大家，RUPS 將會迎來非常好的一年。如果沒有達到我們年初預測的水平，我不會認為這是失敗。

PC is a little bit of a different story. Yes. Certainly, the numbers have slipped quite a bit. We've talked on the past call about -- about modest tariff impacts in our ability to manage that. I think for the most part, that is true.

PC 的情況則稍有不同。是的。當然，數字已經下降不少了。我們在過去的電話會議上談到了關稅對我們管理這一問題的能力的適度影響。我認為，在大多數情況下，這是事實。

The numbers I've talked about in the grand scheme of things are not necessarily large, and I think that if we were seeing, again, a small bump in volume this year instead of a small decline, We -- again, we probably wouldn't be talking about it. We would be able to more than absorb it and -- but when you're talking about a small volume decline, and no ability to then, at that point, more or less overcome those numbers and all of a sudden, they get a little bit more magnified. So not big overall but a couple of million here, a couple of million there. You're not getting volume to sort of recover some of that, and it starts to add up. And then at some point for us, at least, it was like, okay, we don't think we're going to be able to make this up in the back half.

從總體上看，我所談論的數字並不一定很大，而且我認為，如果我們今年再次看到交易量小幅增長而不是小幅下降，我們——我們可能就不會談論它了。我們不僅能夠吸收它，而且——但是當你談論的是小幅下降時，我們沒有能力在那時或多或少地克服這些數字，而且突然之間，它們變得更加放大了。所以整體來說不是很大，但這裡有幾百萬，那裡有幾百萬。你沒有獲得足夠的數量來恢復其中的一部分，而且它開始累積起來。然後，至少對我們來說，在某個時候，我們會覺得，好吧，我們認為我們無法在後半段彌補這一差距。

So we want to make sure that we provide a range -- a target range that we have a high degree of confidence that we can meet. And so that's kind of the summation of it. But PC, yes, would be the -- I'd say, the biggest impact and certainly RUPS in terms of the change from last quarter to this, but it's going to still have a pretty good year overall.

因此，我們希望確保我們提供一個範圍——一個我們有高度信心能夠達到的目標範圍。這就是它的總結。但是，是的，我認為 PC 將是影響最大的，而且從上個季度到這個季度的變化來看，RUPS 肯定是最大的，但總體而言，今年的表現仍然會相當不錯。

Yes. Okay. I just wanted to clarify that. I didn't mean to infer that the PC -- the railroad was not going to have a good year you sort of forecast the drop in demand from 8% to 4%. So okay.

是的。好的。我只是想澄清這一點。我並不是想推斷 PC——鐵路今年不會有好運，而是預測需求會從 8% 下降到 4%。好吧。

Michael Mathison, Sidoti & Company.

馬西森 (Michael Mathison)，Sidoti & Company。

Congratulations on all the margin improvement this quarter, you guys. A couple of questions from my end. There was some news about a proposed consolidation among the big six rail companies, two of them are proposing to merge. Will that change life for you guys from either a pricing or a demand standpoint?

大家好，恭喜你們本季的利潤率有所提升。我有幾個問題。有消息稱，六大鐵路公司提議合併，其中兩家提議合併。從定價或需求的角度來看，這會改變你們的生活嗎？

Hard to say. Hard to say. I think that's yet to be determined. There -- we have business with all of the Class 1s, and we consider them all very important customers. And so my hope would be that we would -- if that merger ultimately goes through, we would continue to serve the merged company in a way that is at least as much as we do today.

很難說。很難說。我認為這尚未確定。我們與所有 Class 1 公司都有業務往來，我們認為他們都是非常重要的客戶。因此，我希望，如果合併最終成功，我們將繼續以至少與今天相同的方式為合併後的公司提供服務。

But it's tough to say right now, it's so early on.

但現在還很難說，還太早。

Fair enough. Just coming back to margins going forward. Everybody has a lot of curiosity. It obviously took a lot of work to reach 15%. You're now targeting high teens.

很公平。回到未來的利潤問題。每個人都有很多好奇心。顯然，要達到 15% 需要付出很多努力。您現在的目標是十幾歲的青少年。

That's another 200 basis points in lift. Is there anything specific that you could point to that would drive such a big transformation in the margin?

這又增加了 200 個基點。您能指出有什麼具體因素可以推動利潤率發生如此巨大的轉變嗎？

At this point, it's just volume recovery, right? I mean if you look across our businesses, it's rare, and I talk about it often, right? I believe the value in our business is its diversity. And so we typically have at least 2 to 3 businesses sort of on the upside of the cycle and maybe 1 or 2 down or vice versa. 1 or 2 up and 2 or 3 down.

此時，只是音量恢復而已，對嗎？我的意思是，如果你看看我們的業務，這種情況很少見，而且我經常談論它，對嗎？我相信我們業務的價值在於它的多元性。因此，我們通常至少有 2 到 3 家企業處於週期的上行趨勢，可能有 1 到 2 家企業處於下行趨勢，反之亦然。 1 到 2 家企業處於上行趨勢，2 到 3 家企業處於下行趨勢。

It's a unique circumstance for either all of them to be down or all of them to be up. We are in this period, and I think we're getting closer to the end of this period where they're all sort of in a lull. And that's unusual. And so that's why I point to a 15% margin in an environment where we're down 10% on the top line and say, think about what that would look like if PC -- when PC goes from minus 2 in terms of volumes to plus 2. And think about it when UIP starts to see its rebound from what -- up until this point, up until this quarter has been, again, year-over-year declines in volume.

要么全部倒下，要么全部起來，這是一種獨特的情況。我們正處於這個時期，我認為我們即將接近這個時期的尾聲，他們都處於一種平靜之中。這很不尋常。這就是為什麼我指出，在我們的營業收入下降 10% 的情況下，利潤率為 15%，並且說，想想如果 PC——當 PC 的數量從負 2 變為正 2 時，情況會是什麼樣子。想想看，當 UIP 開始反彈時——到目前為止，直到本季度，交易量一直在同比下降。

Think about RPS, which is going to be up this year, but last year ended down in volume and for the most part, has been somewhat flat. And then CM&C, a similar sort of story. I mean, it's been down in the past couple of years. You start to see a little bit of a recovery there. All that savings that we're generating is going to drop to the bottom line.

想想 RPS，今年將會上升，但去年的交易量卻下降了，而且在大多數情況下，一直比較平穩。然後是 CM&C，類似的故事。我的意思是，過去幾年它一直在下降。你開始看到那裡出現一點點復甦。我們節省的所有資金都將轉化為利潤。

And so, that's how I perceive basically getting that margin lift that we're talking about. We're not done on the cost side. There is more to come. And so we'll be adding additional benefits there. And then you start to see some of the markets kind of -- they don't have to be in all the businesses.

所以，這就是我所認為的我們所說的利潤率提升。我們在成本方面的工作還沒有完成。接下來還有更多。因此我們將在那裡增加額外的福利。然後你開始看到一些市場——它們不必涉及所有業務。

You see some of these markets start to rebound a little bit and all of a sudden, you're going to see a compounding effect on the profitability and the margins. That's why I say I really feel like we're at a tipping point here, we're so close. It may not be in '25 because the business is -- has its seasonal cycles. And we're going to be moving into the down part of the seasonal cycle as we get to the back part of the year or the fourth quarter of the year. But as we come into '26, I am really hopeful that we start to see some improvement in the end markets because if we do, I think we're going to see a significant amount of improvement.

你會看到其中一些市場開始反彈，突然之間，你會看到獲利能力和利潤率的複合效應。這就是為什麼我說我真的覺得我們正處於一個轉折點，我們已經非常接近了。但 25 年可能不會出現這種情況，因為業務有其季節性週期。當我們進入年底或第四季時，我們將進入季節性週期的低迷期。但隨著我們進入 26 年，我真的希望我們開始看到終端市場的一些改善，因為如果我們這樣做，我認為我們將看到顯著的改善。

Great. And good luck in the back half of the year.

偉大的。祝你下半年好運。

Thank you, Michael.

謝謝你，麥可。

Thank you.

謝謝。

Appreciate that. Thank you.

非常感謝。謝謝。

This concludes our question-and-answer session. I would like to turn the conference back over to CEO, Leroy Ball, for any closing remarks.

我們的問答環節到此結束。我想將會議交還給執行長 Leroy Ball，請他致閉幕詞。

Thank you. I really appreciate everybody's time and attention today. As I mentioned, a lot of really good things going on in the organization and I look forward to being back here in November, with hopefully some better news and some signs of improvement as we look out into 2026. So thank you, everyone, and have a great day.

謝謝。我非常感謝大家今天的時間和關注。正如我所提到的，組織中正在發生很多非常好的事情，我期待著 11 月再次來到這裡，希望在我們展望 2026 年時能聽到一些更好的消息和一些改善的跡象。謝謝大家，祝大家有個愉快的一天。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現已結束。感謝您參加今天的演講。您現在可以斷開連線。