Good morning and welcome to the AdvanSix fourth quarter 2020 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today’s presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Adam Kressel, Director of Investor Relations. Please go ahead.

Thank you, Chad. Good morning and welcome to AdvanSix’s fourth quarter 2020 earnings conference call. With me here today are President and CEO, Erin Kane, and Senior Vice President and CFO, Michael Preston. This call and webcast, including any non-GAAP reconciliations, are available on our website at investors.advansix.com. Note that elements of this presentation contain forward-looking statements that are based on our best view of the world and of our business as we see it today. Those elements can change and the actual results could differ materially from those projected, and we ask that you consider them in that light. We refer you to the forward-looking statements included in our press release and earnings presentation. In addition, we identify the principal risks and uncertainties that affect our performance in our SEC filings, including our annual report on Form 10-K as further updated in subsequent filings with the SEC. This morning we’ll review our financial results for the fourth quarter and full year of 2020 and share our outlook for our key product lines and end markets. Finally, we’ll leave time for your questions at the end. With that, I’ll turn the call over to AdvanSix’s President and CEO, Erin Kane.

Thanks, Adam, and good morning everyone. Thank you for joining us and for your continued interest in AdvanSix. I hope that everyone listening today, as well as their families and coworkers, are remaining healthy and staying safe. As you saw in our press release, AdvanSix delivered a terrific 2020 with another strong quarter to finish the year. Through the many challenges brought on by the external environment last year, our organization demonstrated resilience, perseverance, and strength of execution as we delivered on our commitments: driving positive sales volume growth, generating higher margins and earnings, and delivering positive and robust free cash flow while also reducing leverage. We maintained continuous operations across our facilities including the execution of a large planned plant turnaround and successful implementation of health and safety protocols in the wake of the COVID-19 pandemic to protect our employees, contractors, assets, and other key stakeholders. We mitigated the impacts of COVID-19 through proactive cost and productivity initiatives and ensured we remained in lockstep with changes in customer demand across our supply chain while continuing to invest for growth and improving the underlying earnings power of the business. Our ability to withstand and overcome these challenges demonstrates the resilience and strength of our business model and portfolio diversity as well as the importance of our sustained efforts in building the foundation for long-term performance and shareholder return. I couldn’t be prouder of our team. Mike will detail our financials in a moment, but as you can see on the left side of Slide 3, we’ve highlighted year-over-year variances for some key metrics in both the fourth quarter and full year. I won’t mention them all, but you can see the significant improvement in performance, particularly our ability to generate an 11% increase in net income and a $59 million improvement in free cash flow for the full year. Our fourth quarter 2020 EBITDA was the highest we’ve seen since the second quarter of 2018. As we look forward, we do recognize we continue to navigate a COVID environment. That said, we expect near-term improvement in nylon demand, increased ammonium sulfate fertilizer demand throughout the upcoming planting season, and favourable acetone industry supply and demand balance to continue while also benefiting from our ongoing investments for differentiated product growth. With our focus and rigor around operational excellence, we are targeting a record year of production output in 2021, supporting higher earnings and robust cash flow while making continued progress on our sustainability initiatives. We have a lot of excitement around our organization and the opportunities that lie ahead. Our strategic priorities remain consistent as we support continued operational excellence and improving through-cycle profitability, enhancing our portfolio resiliency through differentiated product growth and mix optimization, and being strong and disciplined stewards of capital. Many have been waiting to look back on 2020 with hindsight. We are taking those lessons learned and the momentum we built into 2021 and remain confident in our ability to deliver long-term shareholder value. With that, I’ll turn it over to Mike to discuss the details of the quarter.

Okay, great. Thanks, Erin and good morning everyone. I’m now on Slide 4, where I’ll review the fourth quarter financial results. Overall, we executed once again very well in a dynamic environment highlighted by volume growth, margin expansion, and strong cash generation. Sales totaled $340 million - that’s up about 4% compared to last year. Sales volume in the quarter increased roughly 8% versus the prior year primarily due to higher production output and improved end market demand overall. Pricing overall was down approximately 4% due to lower raw material pass-through pricing, which was unfavorable by about 4%. Market-based pricing was favourable by just under 1%, reflecting improved industry dynamics in chemical intermediates, particularly acetone. This was partially offset by lagging regional end market conditions in our nylon and caprolactam product lines. Notably, this quarter was the first time we’ve seen market pricing turn positive since the first quarter of 2019. EBITDA was $48 million in the quarter, up about $36 million versus the prior year. I’ll walk through the key year-over-year variances on the next slide. Earnings per share of $0.94 increased $1.02 per share versus the prior year. In the quarter, we saw a lower effective tax rate compared to last year, primarily driven by an approximately $3.8 million energy tax credit associated with our natural gas boiler investment. Lastly, cash flow from operations reached $48 million in the quarter - that’s up about $28 million compared to last year, primarily due to higher net income. Capex of $15 million was favourable by roughly $29 million year-over-year with a normalized level of capital spend as expected. Importantly, we generated positive free cash flow for the full year as we anticipated, a testament to the collective organization executing in a challenging environment. I would also point out that the expected approximately $12 million cash tax refund related to the CARES Act remains outstanding and is now anticipated to be received in the first half of 2021. Let’s turn to Slide 5. Here we highlight a few of the key drivers of our fourth quarter EBITDA performance year-over-year. Pricing of our raw materials was roughly a $3 million tailwind year-over-year. Tracking our key variable margin drivers, performance in chemical intermediates reflected a continued favourable supply and demand environment for acetone over propylene spreads. Ammonium sulfate on a net price over natural gas and sulfur basis, and caprolactam and nylon over benzene were both down year-over-year. The impact of planned plant turnarounds to pre-tax income was only $2 million in the fourth quarter of 2020 versus approximately $25 million in the fourth quarter of 2019, representing an approximately $23 million decrease year-over-year. As you may recall, we completed a larger Hopewell planned turnaround in the fourth quarter of 2019, including our sulfuric acid plant. For the full year 2020, the total pre-tax income impact of turnarounds was approximately $31 million compared to $35 million in 2019 as we drive further efficiencies in our turnaround processes and execution. Our realigned cumene supply chain and logistics productivity represented an approximately $4 million favorable impact in the quarter as we continued to reduce incremental cumene sourcing costs through supply chain planning optimization and other efficiencies following the 2019 shutdown of cumene supplier, Philadelphia Energy Solutions. Lastly, plant productivity, higher volume, and other items were approximately $5 million favorable in the quarter. Now let’s turn to the next slide. We summarized our full-year 2020 financial results on Slide 6. We are very proud of what we delivered in 2020 in a challenging macro environment. I will not go through all the detail on the slide, but some of the key highlights include: first, growth in sales volume despite the ongoing impacts of COVID-19; second, higher earnings driven by strong productivity, cost management, and the favorable impact of lower raw material costs more than offsetting lower market pricing and an unfavorable mix impact. For the full year, we saw an approximately $26 million cost reduction as we took a proactive approach to mitigate the impacts of COVID on our business. As we disclosed previously, we estimate roughly half of the full-year cost savings are more temporary in nature with the remainder more permanent. Third, tax planning initiatives that resulted in a lower effective tax rate, and lastly higher free cash flow supported by an approximately $67 million reduction in capital expenditures. Now let’s turn to Slide 7 to further discuss our cash flow and leverage exiting the year. On the left side of the page, we’ve highlighted the drivers of the robust $32 million of free cash flow in the fourth quarter, supported by net income and lower capital spend rates. As anticipated, free cash flow was positive for the full year. In the quarter, we saw working capital roughly neutral as ammonium sulfate pre-buy cash advances largely offset other increases, including higher accounts receivable due to sharply higher sales in the fourth quarter compared to the third quarter. As we previewed, our capex run rate has come down to more normalized run rates following the completion of several larger, high-return growth and cost savings investments, and as we continue to drive discipline in our capital processes. On the right side of the page, we’ve once again shown our leverage ratios or net debt over trailing 12-months adjusted EBITDA, going back to the end of 2018. Both net debt and adjusted EBITDA are calculated in accordance with the terms of our revolving credit facility. As planned, our leverage was reduced in the fourth quarter of 2020, supported by continued robust cash generation, the normalization of the planned plant turnaround impact on our trailing 12 months of EBITDA, as well as debt pay down. We exited the year at a leverage ratio of two times, which is comfortably within our target range of 1 to 2.5 times. We continue to expect a robust cash flow outlook for 2021 and leverage to continue trending lower. Now let me turn the call back to Erin.

Thanks, Mike. I’m now on Slide 8, where we’ve included our typical pricing and spreads across our product lines. We’ve seen nylon industry spreads improving off trough levels as demand has modestly improved with economies reopening around the globe. As we’ve shared previously, Asia has led the recovery with the U.S. and Europe lagging, which you see here in the difference between the global composite and Asia spreads. Although the industry remains in an oversupply position globally and we’re monitoring inventory levels through the value chain, we are encouraged by the recent improvement in demand and pricing. The Asia caprolactam to benzene spreads averaged around $700 per ton in the fourth quarter compared to roughly $600 per ton in the first nine months of 2020. We saw benzene input costs increasing as we exited 2020, which caprolactam and resin prices closely followed. In addition, we continue to see global prices trending positively entering the new year. Overall nitrogen industry pricing was subdued for the fall application season but has picked up considerably as we’ve exited the year on the back of improved agricultural fundamentals, including crop prices, farmer profitability, and planted acres overall. As a reminder, urea is the largest nitrogen fertilizer by total consumption and tends to have an underlying influence on other nitrogen products; however, ammonium sulfate does have its own supply and demand dynamics, influencing the premium earned for the sulfur nutrient. Sequentially, ammonium sulfate prices were roughly flat as we entered the new ag season and were down year-over-year on the impact of lengthened supply and demand as we continue to monitor competitive dynamics in light of North America supply additions as well as European imports. Lastly, industry-realized acetone prices over refinery-grade propylene costs continued to expand in the fourth quarter, tracking a snug supply and demand balance in the U.S. We’ve seen continued expansion of the premium in the small-medium buyer acetone prices over the large buyer market on a year-over-year basis through the end of the year. As a reminder, the small-medium buyer price is reflective of roughly one-third of the domestic industry where pricing is predominantly freely negotiated. This has come at a time when propylene costs have continued to increase significantly on very tight supply and demand dynamics. We’re seeing this trend play out in the first quarter with further industry price increases to keep pace with the rising input costs while refinery-grade propylene prices have reached their highest level in over two years. Let’s turn to Slide 9 to discuss some industry considerations as we progress into 2021. As shared in the past, we’ve included a breakdown of North American industry demand as well as our own 2020 sales mix to provide some context around our exposure to various end uses. Starting with nylon, we’ve seen some improvement in demand across its consumer-oriented end markets. Carpet, which is the largest nylon end use in North America, while still faced with structural demand declines, has rebounded from its Q2 COVID trough, and mill rates have stabilized through the fourth quarter. This year’s improvement from residential applications on the back of strong housing starts and existing home sales supported sequential demand improvement, while commercial construction continues to lag. We continue to expect commercial construction, where nylon has a stronger foothold, to remain soft in the near term until there is more visibility into office and hospitality trends post-COVID. In engineered plastics, where auto represents about 60% of nylon demand in that space, we’ve seen demand improvement with global auto production rates increasing. To date, we haven’t seen any impact back to our compounding customers related to the widely known silicon chip shortages, which have impacted output at several OEMs further down the value chain. The remainder of our engineered plastics exposure in consumer and industrial and electric and electronic spaces remains resilient with volume and demand back to pre-COVID levels. Lastly, food packaging demand for nylon has remained robust during this period, which we expect to continue into 2021. Overall, we’re encouraged by the trends we’ve seen exiting the fourth quarter and entering 2021. Moving forward, our efforts focused on asset flexibility, new product and application development, and customer qualifications are helping to mitigate the temporary unfavorable mix considerations we faced throughout 2020 as we placed products where demand existed. Let’s shift to ammonium sulfate. I will highlight a number of recent activities around ammonium sulfate on the next slide, but from an industry perspective, sulfur demand remains robust as a key nutrient supporting crop yields, and we expect ammonium sulfate fertilizer demand to increase with the 2021 planting season. A number of key indicators are trending favorably: lowered expectations for ending stocks, including corn and soybeans is translating into increased crop prices, which have surged in recent weeks and months to multi-year highs. The supply and demand balance has been supporting crop prices at these higher levels while the profitability outlook for growers continues to improve. Stronger anticipated nitrogen fertilizer demand coupled with regional supply constraints and increasing input costs have supported increases in urea pricing, which in turn has supported other nitrogen pricing, including ammonium sulfate. In this space, we will continue to monitor increases in industry raw material inputs as well, including natural gas and sulfur. Moving to chemical intermediates, we expect a favorable acetone industry supply and demand balance to continue into 2021. Acetone imports into the U.S. remain low with global phenol industry utilization keeping supply and demand rather snug. Demand for acetone continues to be robust as a precursor into acrylic screens continue to be used as protective equipment at retail, offices, and other locations. We also continue to see strong demand for our chemical intermediates into paints and coatings, particularly with do-it-yourself home improvement projects on the rise during the pandemic. As I mentioned in regard to nylon, auto demand has been recovering, and although we are further back in the value chain, a number of our products in the intermediate portfolio also serve that end market. We also continue to see growth momentum for our Nadone product line, which is a solvent used in various high-value applications. Let’s turn to Slide 10. As you may have seen in our press release earlier this quarter, we are further building on our longstanding leadership and expertise in ammonium sulfate and sulfur nutrition while creating further opportunities for growth in efficiencies across the value chain. We continue to see increased demand for sulfur nutrition and ammonium sulfate has proven to deliver pound-for-pound the most readily available sulfur and nitrogen to a wide variety of crops, including wheat, cotton, corn, and soybeans. We highlight a number of recent activities, including the value of ammonium sulfate on soybeans, a crop where AS is not applied today. We are continuing to educate growers and retailers about recent lab and field trial results, particularly the benefits of ammonium sulfate which adds sulfur and supplemental nitrogen to their soybean crop management plans. We believe farmers have a great opportunity to boost production through new nutrient management strategies with research showing yield increases of as much as 10 or more bushels per acre. Operationally, recent efforts and enhancements in crystallizer technology have supported our production output of more high-quality, granular grade ammonium sulfate to meet the growing demand of our customers. We are now targeting conversion of approximately 65% of the ammonium sulfate produced into this higher value granular form, which is an increase of roughly 5%. As a reminder, that granular product can earn a sales premium over the standard grade product of up to $50 per ton on average. Lastly, we announced the recent acquisition of certain assets of Commonwealth Industrial Services, or CIS, which enables us to expand our offering to directly supply packaged ammonium sulfate to customers, primarily in North and South America. It diversifies and optimizes our offerings to include a spray-grade adjuvant to support crop protection, a fire retardant insulation, as well as other specialty fertilizers and products for industrial use. We also expect the addition of packaging and warehousing capabilities to bolster logistics and operational efficiency in our Richmond, Virginia area plants. We are very excited to welcome our new teammates and extend our industry-leading value chain for ammonium sulfate. Now let’s turn to Slide 11. As you may have seen in our December press release, I wanted to spend a moment highlighting a number of achievements and the progress we made in 2020 as we continue to build a broad platform for sustainability and corporate social responsibility across our organization and with stakeholders. We were proud to join with other industry leaders in a number of global sustainability initiatives, including active participation with the EcoVadis Corporate Social Responsibility Assessment that resulted in a gold rating, placing us in the top 4% of chemical industry peers. In November we joined Together for Sustainability, a global procurement-driven initiative to assess and improve the sustainability performance of chemical companies and their suppliers. We were also a signatory to the U.N. Global Compact and made a pledge to Operation Clean Sweep. Underpinning all of this is our ongoing commitment to being an ACC Responsible Care company, including having all of our AdvanSix sites RC 14001 certified. In the year, we also established our Sustainability Council under the oversight of the newly created Health, Safety, Environmental and Sustainability Committee of the board. The Sustainability Council is supported by subject matter experts throughout the organization to develop a holistic enterprise-wide view of sustainability. We look forward to sharing our next sustainability report in the coming months with you all, building on the enhanced ESG disclosures published last year. Our sustainability efforts continue to mature in concert with our strategic priorities. Let’s turn to Slide 12 to wrap up before moving to Q&A. Consistent with what we shared last quarter, our core focus areas for 2021 include continued operational excellence and improving through-cycle profitability, enhancing portfolio resiliency, and strong capital stewardship. We are targeting a record year of production output in 2021 supporting higher earnings and robust cash flow. We’re maintaining a rigorous focus on productivity and cost savings with approximately half of the 2020 cost savings living through based on structural and permanent actions taken throughout last year. Commercially, as I’ve highlighted, we’re largely seeing the trends of the fourth quarter across the business continue into the first quarter of 2021 in addition to strengthening agricultural fundamentals. We have all seen the recent severe weather that has covered a large majority of the country, particularly down in the Gulf. This is an evolving situation real-time, and our focus at current is to protect our value chain and customers while minimizing disruptions. We are bolstering growth through investments in our Nadone and product pipelines, serving differentiated and high-value applications while continuing to optimize our nylon offerings amid carpet end market declines. We do continue to expect capex to be $80 million to $90 million in 2021, which does include a modest amount of spend towards high-return growth and cost savings projects. We are focused on improving our return on invested capital and we will remain disciplined in our approach as we look to drive long-term shareholder value. We expect leverage to remain within our target range and have approximately $60 million remaining under our share repurchase authorization. We’re maintaining a disciplined inorganic framework as we assess opportunistic acquisitions that would have strong portfolio coherence with our product lines and technologies. CIS is a great example of this as we drive the sulfur nutrition value proposition while integrating their packaged ammonium sulfate business. To close where I started, we are gaining momentum and remain confident that AdvanSix is well positioned to deliver long-term shareholder returns. With that, Adam, let’s move to Q&A.

Thanks, Erin. Chad, let’s open the line for questions.

The first question will come from Vincent Anderson with Stifel. Please go ahead.

Yes, good morning, and wonderful end to the year. Just to start it off in nylon, we’ve watched export prices out of Taiwan recover pretty rapidly ahead of their capro costs, which would seem to underscore the spreads that you’ve published in your slide deck. Should we still be looking to Taiwan as kind of a price setter for the Asian markets, or is that maybe a naive view especially since their exports have continued to decline since really 2016?

Great question, Vincent, and thank you for the compliment about 2020. When we consider the global markets, it's crucial to identify where supply and demand intersect. As we've mentioned, looking at China is important; they have anti-dumping measures and are expanding their regional supply, which shifts the focus to Taiwan and South Korea. We continue to monitor these key regions because they play a significant role in global imports. There's a strong link in that area that provides insight into the overall supply and demand balance. I believe it's still relevant to focus there. We have noticed some discrepancies and increased volatility in real-time pricing, so it's essential to adopt a broader perspective over a few weeks or even a month to identify trends, as we can witness temporary disconnects. For instance, while last year saw a significant year-over-year increase, that was largely influenced by a specific challenge in the previous year's quarter, which can distort some metrics. In summary, we maintain that this is the region to watch as global dynamics unfold.

Perfect, thanks. This is maybe going a little far back, but if my memory serves, Goodrich used to operate a specialty nylon plant in Canada that was shut down a while ago, but it used to supply its tire manufacturing. It’s one area that we haven’t really heard you talk about potential applications for Nylon 6. Is it still used in tire applications, and if so, is that an area of opportunity for you to explore?

One of the opportunities that the shutdown has presented is the growth in our wire and cable application space, where we have seen participation, and our wire and cable growth continues to be a significant highlight in our differentiated application growth for nylon. Historically, there was substantial demand for tire cord, particularly for larger tires suited for construction applications. This was a major application in China at one time and can still be found there, although nylon 6 is likely not as common as it was in the past.

Okay, perfect. Thanks for clearing that up. Then just one more quick one and I’ll let somebody else have a turn here. How many field trials do you have scheduled for 2021 on soybean acres, and a rough split between university-test fields and farmer fields?

I will make sure to provide you with the detailed numbers. Our field trials are ongoing, and you can find information about our soybeans on our new microsite linked in our press release. Adam can follow up on that. We've been receiving positive feedback from our customers, and we believe that the product is moving to fields and could be deployed this spring as well. I apologize for not having the exact split at the moment, but we are definitely seeing positive trends.

The next question comes from Chris Moore with CJS Securities. Please go ahead.

Hey, good morning guys. Projecting turnaround costs in the $25 million to $30 million range in fiscal ’21, and I guess the question is what are the drivers there versus historically more in the $35 million to $40 million range, and is this level the new normal?

Yes, good point Chris, and I appreciate you pointing that out. What we provided in the back of the presentation is the year-over-year and quarter-by-quarter impacts of the planned plant turnarounds. To your point, we have seen an improvement in the spend if you go back a number of years, and this year we’re looking at $25 million to $30 million, which is down from last year of $31 million, and in 2019 roughly $35 million. We do believe $30 million is in that sort of range - $25 million to $30 million is roughly our new run rate. This is an area that we’ve been very focused on in terms of driving efficiencies, better planning, managing the scope, the duration, really driving the costs down, so I would say this has been an area we’ve been trying to drive productivity, efficiency, and effectiveness in, and we do believe that’s roughly our new range. Now I will say from year to year, depending on whether or not we do the sulfuric acid plant turnaround or the ammonia plant turnaround from year to year, you could see a bit of a fluctuation in that total amount but over time, we’re seeing a reduction.

Got it, helpful. It looks like nylon sales for consumer carpet is doing well. Can you remind me what the mix normally is between consumer and commercial, and what that mix looks like currently?

Great question. If you consider the North American carpet market overall, approximately 70% is for residential use and 30% is commercial. In the residential segment, about 55% is non-nylon and roughly 15% is nylon. Historically, most of the commercial segment has utilized Nylon 6 or Nylon 66. We saw mill rates decline year-on-year by about 10%, and the residential sector has been a significant driver of activity. Each home sale often leads to renovations, and new builds also contribute to flooring installations. It's encouraging to see a rebound; our carpet customers are purchasing at rates similar to those before COVID, and it's particularly the residential side that is supporting this growth.

Got it. Helpful. Last one from me, there’s been lots of headlines recently regarding severe weather, particularly some disruptions down in the Gulf. Are you seeing any challenges to your supply chain?

Thank you for your question, Chris. To start, I want to highlight some positive developments as we approached this week. As you are aware, there have been several headlines and unforeseen circumstances, and the situation is changing rapidly. We entered this period in a strong position throughout Q4 and into January, maintaining solid utilization rates of over 90% across our value chain, with Hopewell performing exceptionally well in the mid to high 90s. This is a clear indication that our operational discipline and reinvestment strategies are yielding results. We also have a strong inventory of our intermediate chemicals, which helps buffer against the usual seasonal supply chain challenges we face during this time of year, particularly with storms. Additionally, we anticipated known refinery turnarounds occurring early in the first quarter. However, as you mentioned, the situation is evolving day by day. In some instances, it’s quite complex as we gather information hourly. Although we are geographically distanced from the main storm impacts, we do depend on key raw materials from the Gulf, and currently, all North American producers of cumene have declared force majeure. Earlier this week, we also experienced water supply issues from a supplier in Hopewell due to icing in the mid-Atlantic. It is important to emphasize that all our plants are still operational; however, due to the rapidly changing situation, we have decided to reduce our plant rates proactively and take steps to minimize disruptions. Specifically, we have moved planned maintenance that was scheduled for March to the latter half of February. This allows us time to better understand the situation. There are indications that refiners will begin restarting operations over the weekend, but there are certainly disruptions in power and transportation utilities. We are fully committed to protecting our customers and minimizing disruptions. This is when our strong execution capabilities come into play, as we demonstrated last year. Currently, we are seeing impacts across our suppliers, competitors, and customers, and we are working diligently to manage both the opportunities and risks that arise, while staying closely aligned with our suppliers and customers as the situation develops.

The next question comes from David Silver with CL King. Please go ahead.

Yes, hi. Thank you. I just wanted to follow up maybe on the previous question regarding the impacts from the situation in Texas. You focused right in on, I guess, the cumene supply situation, but could you just take a moment and just clarify whether you’re reliant on U.S. Gulf sources for either natural gas or sulfur, or anything else to think about, as you said, right in this kind of fast evolving, real-time situation? Are there alternative sources from non-U.S. Gulf sources that you’re comfortable with for the other inputs to your overall production chain? Thank you.

Yes, happy to provide that clarity, David. Thanks for the follow-on here. Certainly even with cumene, I think when we talked about how we have worked to mitigate even the 2019 shutdown of the east coast supplier, Philadelphia Energy Solutions, we talked about broadening the basket of suppliers, so we do have suppliers that are outside the Gulf, which is important to note, including the ability to import, so all those levers I think that we are pulling and have been pulling for the performance of the company and value chain going forward. When it comes to natural gas, certainly you have seen restrictions. From where we sit geographically, we are predominantly pulling from molecules that are tied to the basins closer to us in that pipeline, so there are not restrictions in the area. Certainly this time of year, it’s not uncommon for us to see some curtailments from time to time, just as natural gas lines are managing both residential as well as industry, but there is no disruption to natural gas for us at this point. Sulfur, as you well know, is also coming off the refinery complex. Again, given we’re moving molten sulfur, logistics are important, so I think it’s fair to say that a vast majority of our sulfur comes from refineries outside the Gulf that are going to be geographically closer located to us, and again we see supply. It’s one of the things, as I pointed out, and why we built up inventories through the end of 2020 - you know, on one hand you could see that based on high refineries, we’re operating just with COVID impacts and people not traveling, that all of these materials coming off the system could be challenged, so we’ve been proactively making sure that we were buying molecules ahead of time to keep our value chain protected.

Okay, thank you for that. Again, as you pointed out, it’s a real-time, evolving situation. I was wondering if Mike could help me with the next one. In the release, you talked about the year-over-year change, or you broke down the revenue change, the 4% growth in terms of volume plus 8, and then price, both list price increase and then the pass through effect of about minus 4. I was wondering if you could do something similar on a sequential basis; in other words, how much of the 21% sequential bump in revenues was volume driven versus the price? However you might have that, that would be much appreciated. Thanks.

Yes, sure. Happy to do that. As you saw, as you noted, we did have quite an increase in revenue in the fourth quarter relative to the third quarter, and the way you want to think about that is volumes were up sequentially in sort of the mid-teens range from a top line perspective, and we saw there is some domestic granular ammonium sulfate growth, some seasonality with that acetone, as well as caprolactam and nylon improvement overall in volumes, particularly in North America, so volumes were up strong in the fourth quarter relative to the third. I’d say market pricing net of raw materials was pretty neutral. We did have an unfavorable impact fourth quarter versus third from a natural gas perspective. A lot of that you would typically see from a seasonal perspective and that was offset by better pricing for acetone sequentially. Then you’re sort of left with the plant turnaround impact in the fourth quarter relative to the third, and that’s an $18 million change. Obviously we had a large impact in the third quarter and much less an impact in the fourth, so on an EBITDA basis, that’s about an $18 million change. Those are, I would say the biggest changes when you look sequentially from third to the fourth quarter.

Thank you. I have one more question, and then I’ll return to the queue. Could you explain the effect of the CARES Act on your cash flow? I apologize for the oversight.

Yes, certainly. We wanted to clarify that, through the CARES Act, we were able to carry back our net operating losses. Many companies took advantage of this, and we claimed a refund of $12 million. We had expected to receive this before the year's end, but the IRS has been quite slow in processing those refunds. However, we were pleased to see that we generated strong cash flow in this quarter, despite not yet receiving the $12 million refund. We anticipate getting it in the first half of the year and are hopeful to receive it in the first quarter. This is the main benefit we are experiencing from the CARES Act. Additionally, the CARES Act allowed us to defer around $6.5 million in payroll taxes during 2020, with 50% to be repaid in 2021 and the remaining 50% in 2022. These were the key benefits we took advantage of, but that refund is still pending.

Yes, thanks. I was going to ask you just about how that affects the cash flows from the CARES Act, both the receipt and then the repayment, so thanks - you anticipated that. Just real quick, the energy tax credit, $3.8 million, is that a one-time item, or is your investment in the new boiler and whatnot, is that eligible for additional tax credits going forward?

I consider that a one-time event. In the second quarter of 2019, we claimed this credit on our return related to the natural gas boilers. At that time, we believed we had enough authority to claim the credit but needed more technical analysis and discussions with the Department of Energy to be confident in reversing that and recognizing it in our financial statements. The challenge was reaching a more likely than not position on an uncertain tax position. We claimed it in the second quarter, booked the uncertain tax position, and by the fourth quarter, we felt comfortable enough to reverse it, leading to a reduction in our effective tax rate. The amount was $3.8 million, which is a significant part of the $12 million refund we’ve claimed, resulting in approximately a $0.13 per share impact in the fourth quarter and affecting our effective tax rate by about 6.5% for the full year. Although this is a one-time occurrence, I want to emphasize that we continue to seek ways to optimize our tax strategy, explore opportunities for planning to manage our rate, and also manage our cash taxes. We have made substantial progress in this area and will keep looking for further opportunities moving forward.

Ladies and gentlemen, this concludes our question and answer session. I would like to turn the conference back over to Erin Kane for any closing remarks.

Thank you all again for your time and interest this morning. Facing one of the most challenging external sets of circumstances this business has ever encountered, our collective organization delivered terrific results in 2020. We optimized our positions across the portfolio and executed levers in our control to deliver best possible outcomes. We will leverage that momentum into 2021 as we execute against a focused strategy that we believe will allow us to outperform and deliver strong shareholder returns into the future. With that, we’ll look forward to speaking with you again next quarter. Stay safe and be well.

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