Good morning, ladies and gentlemen, and welcome to the Element Solutions 4th Quarter and Full Year 2025 Financial Results Conference Call. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number 1 on your telephone keypad. If you would like to withdraw your question, press star 1 again. Thank you. I will now turn the call over to Veirun Gokharn, Vice President, Strategy and Interrogation. Please go ahead.

Good morning, and thank you for participating in our fourth quarter and full year 2025 earnings conference call. Joining me today are our CEO, Ben Glicklich, and our CFO, Kerry Dorman. In accordance with RegulationFD, we are webcasting this conference call. A replay will be made available in the investors section of the company's website. During today's call, we will make certain forward-looking statements that reflect our current views about the company's future performance and financial results. These statements are based on assumptions and expectations of future events which are subject to risks and uncertainties. Please refer to the Investor section of our website for a discussion of material risk factors that can cause actual results to differ from our expectations. Today's materials include financial information that has not been prepared in accordance with US GAAP. Please refer to the earnings release and supplemental slides for definitions and reconciliations of these non-GAAP measures to comparable GAAP financial measures. It is now my pleasure to introduce our CEO, Ben Glicklage.

Thank you, Varun. Good morning, everyone. Thank you for joining. Element Solutions had another record year in 2025. We executed our model marrying operational excellence and prudent capital allocation to deliver record results while accelerating investment in future growth. The company is benefiting from its position as a solutions partner across the electron electronics manufacturing supply chain, and also strengthening it. Our portfolio breadth, strategic positioning and high value growth niches and deep technical expertise have accelerated opportunities for our businesses. We see that in the results we are reporting today and the activity levels at our customers as we enter 2026. In the past year, demand from data center and high performance computing markets drove 10% organic revenue growth in our electronics business, a trend that accelerated in the fourth quarter. Our electronic solutions and our people enable the increasing performance that our markets demand, as well as faster product iterations and significant advances in reliability and complexity. Customer engagement is as strong as ever, partially driven by our pipeline of new, exciting products. Overall, our company achieved record-adjusted EBITDA and record-adjusted EPS in 2025, despite continued industrial weakness and the divestiture of the graphics business in the first quarter. Our focus on operational excellence means we strongly believe that each of our businesses can improve every year, regardless of the macro environment. We demonstrated that over the past 12 months in our newly renamed specialty segment, where margins expanded 250 basis points, driven by higher value selling, supply chain initiatives, cost efficiencies, and portfolio optimization. The businesses that comprise the specialty segment focus on attractive niche markets with demanding customer qualification requirements and an emphasis on value-added technical service. This creates high margin recurring revenue streams, and we've demonstrated the ability to grow our profits in these businesses even when volumes are soft. We believe we can continue to drive profit growth through share gains and productivity improvements until industrial end markets inevitably recover. We enhanced our portfolio in 2025 through prudent capital allocation. In the first quarter of last year, we divested our slower growth, relatively lower value flexographic printing business and redeployed that capital into two value-enhancing transactions that expand our presence in attractive electronics focused growth adjacencies. We announced the acquisitions of both Micromax and EFC Gases and Advanced Materials in the fourth quarter and closed them both in early 2026. We believe that within the ESI family, these businesses will have the opportunity to flourish and grow faster and more efficiently. Micromax is a global leader in advanced electronics ink and pastes, as well as low-temperature ceramic materials, essential for the most demanding electronics applications. The acquisition enhances our leadership position and technical bona fides in the electronic supply chain. Micromax's innovation and go-to-market capabilities align with our customer-centric approach, enabling us to deliver next-generation materials for high-growth applications such as satellites, electric vehicles, and data centers. Our initial weeks together have reinforced our excitement for the product portfolio and the untapped commercial opportunities that can be unlocked in the years ahead as part of a larger electronics materials company. EFC provides high-purity specialty gases and advanced materials that are essential for certain high-value, high-cost-of-failure applications requiring stringent purity and performance standards. The business is concentrated in fast-growing markets such as semiconductor fabrication, electrical infrastructure, and satellite propulsion. It has grown at a revenue kegger in excess of 15% since 2009, with growth accelerating recently, primarily in semiconductor applications. EFC's focus on niche, high-value products and people-centricity has yielded commercial momentum and a pipeline of customer qualifications that we anticipate will translate into robust earnings growth in the coming years. And their team is a great cultural fit with ours. The business is off to a very strong start in 2026. Taken together, we had an outstanding year with demand-improving sequentially throughout. That sets us up well for 2026. Carrie will now take you through the fourth quarter and fill your financials in more detail, Carrie. Thanks, Ben, and good morning.

On slide four, you can see a summary of our fourth quarter results. Net sales increased 10% organically. led by high-end electronics growth, primarily from AI and data center investments. Electronics segment organic growth was 13%, with all three business verticals growing in the double digits. The circuitry business has been a large beneficiary of AI-related investment, as our market-leading pulse-plating chemistry is used to support fabrication of high-layer count server boards. Assembly Solutions saw similar benefits from both consumer electronics and high-performance computing applications. It drove 12% organic growth in the quarter. Finally, our semiconductor solutions business grew 13% organically, as advanced packaging applications drove demand for wafer-level plating chemistries and power electronics sales returned to growth on the back of new customer wins. Specialty's organic growth was 4%, with modest volume improvement in core industrial and 9% year-over-year growth in energy solutions. Adjusted EBIT after the quarter was $136 million, up 8% year-over-year on a constant currency basis, when excluding the impact of divestitures. Higher pass-through metals in our assembly business created an optical margin headwind of roughly 1% in the fourth quarter. Excluding net sales from these pass-through metals, adjusted EBITDA margin would have been 25.5%, representing a 40-base point improvement year on year. The rapid increase in metal prices in the fourth quarter, particularly silver and tin, also had a negative impact on adjusted EBITDA of several million dollars. This is simply a timing impact, and those earnings should be recaptured in 2026 as inventory sells through and metal prices stabilize. We would have seen stronger incremental margins without this impact. On slide five, we discussed full-year financial results. Net sales for 2025 were $2.6 billion, growing 6% organically. Electronics net sales increased 10% organically, driven by strength in AI and data center markets, demand for advanced packaging metalization solutions, and growth with new EV customers. Specialties grew 1% organically as offshore hydraulic production fluid growth remained robust. In industrial surface treatment, strong automotive growth in Asia and new customer wins later in the year offsets overall sluggish Western industrial markets. Adjusted EBITDA for the year was $548 million, which represents 7% constant currency growth when excluding the impact of the graphics divestiture. Excluding net sales from assembly pass-through metals, adjusted EBITDA margin would have been 26.5%, a 60 basis point increase year over year. Once again, this margin would have been higher if not for the earnings timing impact associated with the steep increase in metal prices during 2025 and particularly in Q4. Finally, we delivered record adjusted EPS for the year of $1.49, despite the graphics divestiture. Next, on slide six, we share additional details on full-year organic growth by business. Our assembly solutions business has a relatively diversified set of end markets, with larger exposure to industrial, consumer electronics, and automotive applications than our other electronics verticals. In 2025, this business grew organically at 8%, with the outperformance driven by strong consumer electronics and automotive demand in Asia, particularly in the first half of the year, and increased demand for our engineered preformed materials used in high-performance computing applications. Circuitry Solutions delivered robust organic growth of 10% for the year, supported by investments in high-performance computing and data center infrastructure. We have industry-leading metallization solutions for the fabrication of dense, high aspect ratio circuit board that are uniquely suited for the extreme requirements of data centers. In addition, our solutions for data storage, EV electronics, and low-Earth orbit satellites provided additional growth vectors. This year, we also focused on investments intended to meaningfully strengthen our presence in Southeast Asia, a region that should see continued momentum in the years ahead as the electronics supply chain seeks to diversify its manufacturing footprint. Semiconductor solutions grew 13% organically year-over-year, reflecting strong demand from advanced packaging metallization solutions and power electronics growth with new EV customers. This is the second consecutive year of mid-teens organic growth for this business. Demand remains robust across all our product lines, and the opportunity pipeline continues to expand. Our customers are performing well with our technologies. For example, our top Viaform copper gamethine customers include 20% on average for the year, and we expect this trend to continue in 2026. We've introduced multiple new product families that are gaining customer traction and see opportunities to grow in areas that intersect with printed circuit board metallizations, such as IC substrate and large format panels. Turning to the specialty segment, Organic growth of 1% reflects softness in industrial-oriented end markets. Energy solutions remained a bright spot, growing 7% organically as we saw continued production fluid revenue growth due to competitive wins and pricing activities. Our core industrial surface treatment business was flat organically for the year on the top line. Underlying volume growth in Asia, automotive end market, was offset by lower European industrial activity. Net sales growth comparisons were impacted by a large customer equipment deal in the third quarter of last year, which is tied to a high-value, multi-year chemistry contract. Moving to cash flow in the balance sheet on slide seven, we generated $256 million of adjusted free cash flow in the year, with $83 million of cash generated in the fourth quarter. Working capital investment in the fourth quarter was higher than we expected due to the rapid increase in tin and precious metal prices and the timing of our hedge settlements. Higher metal prices, even though they are passed through, tie up more capital, all else being equal. However, all else is not equal. Over the past several years, we have worked on optimizing our inventory on a volume basis. Consequently, we have seen solid improvements in both inventory days and overall cash inversions. When the model prices eventually normalize, we expect to see a benefit to cash flow. We invested $61 million in net capex in 2025, advancing key strategic projects such as Couprion and new advanced packaging product manufacturing, as well as our global R&D and production footprint. These investments support high-value growth opportunities and technology leadership in our electronics segment. For 2026, we expect capital expenditures of approximately $75 million, affecting our continued commitment to innovation, capacity expansion where necessary, and new product introductions in fast-growing AI and data center markets primarily. This figure includes the expected capital requirements of our newly acquired businesses. We ended 2025 with a strong balance sheet, including $627 million in cash and a net debt to adjusted EBITDA ratio of 1.8 times. When we closed our two acquisitions earlier in Q1 this year, we paid approximately $870 million, which was funded in part by a new $450 million term loan add-on. Overall, our debt is currently 95% fixed, and our cost of debt remains roughly 4%. Today, co-former leverage is slightly above three times, which we expect to approach two and a half times by year-end in 2026, assuming no further capital allocation. Our liquidity and financial flexibility position us well to fund organic growth, strategic M&A, and capital return to shareholders as appropriate. With that, I will turn the call back to Ben to discuss our outlook. Ben.

Thank you, Kerry. Looking ahead to 2026, we expect market conditions to largely resemble late 2025, with continued strength in high-performance computing and leading-edge electronics and slower industrial markets. There will be noise on the top line driven by metals price volatility, which may also have a bearing on our adjusted EBITDA seasonality and short-term cash flow. But in the fullness of time, these are only timing differences with no impact on overall profit dollars. Our 2026 adjusted EBITDA guidance range is $650 to $670 million, inclusive of the expected contributions from the EFC and Micromax acquisitions and assuming current FX rates and metal prices. This range includes a modest year-over-year FX tailwind and an expected $5 million headwind as we lap the 2025 stub period contribution from our graphics business, together implying high single-digit organic adjusted EBITDA growth. This also translates to adjusted EPS growth in the mid to high teens. Our focus in 2026 will be similar to prior years, with the only adjustment relating to our recent acquisitions. The emphasis will be on operational excellence, integrating EFC and Micromax, and scaling capacity for new products. We've made product qualification milestone payments in the first quarter of this year for Couprion and are in the final innings before ramping capacity at our first site in California. We have other compelling product launches underway in thermal materials, die attach, and circuit board fabrication. We also retain and will build capacity for further accretive capital deployment should attractive opportunities come available. We have strong customer partnerships, a clear strategy, and a growing, high-performing team that is enthusiastic and incentivized to continue to execute on the momentum we have. We're a people-powered company, and I'm grateful for the extraordinary talent that is responsible for a great 2025 and focused on another record year in 2026. Operator, please open the line for questions.

At this time, I would like to remind everyone, in order to ask a question, press star, then the number one on your telephone keypad. We'll pause for a moment to compile the Q&A roster. Your first question comes from the line of Mike Harrison with Seaport Research Partners. Please go ahead.

Hi, good morning. Congrats on a nice finish to the year. Thanks, Mike. I wanted to start with the electronics business and just the margin performance there. If we adjust for that metal price pass-through, it was still relatively weak. It sounds like maybe the metal price spike or kind of the significant rise that you saw in metal prices were also a drag on margins. So I was hoping you could talk about that. But maybe also just if we kind of excluded that metal price impact completely, you know, what were you seeing in terms of underlying margin performance as it related to, you know, operational efficiency, mix, your cost structure, any other factors that we would think about kind of the underlying sustainability of margin performance into next year, or into 26th, I should say.

Thanks for the question, Mike. Like, you know, there are a few things impacting margin in the quarter and in the year. We talked about a corp allocation shift as subsequent to the sale of our graphics business. That had a bearing. We talked about ramping up investment primarily in Couprion, which is just OPEX, as we prepare to ramp that. And then the third variable, which was a new variable here in Q4 and really in December, was this metal pricing dynamic where the spike in metal prices and the associated hedge losses that occurred in Q4 and were more acutely in December had a several million dollar hit to the P&L. Absent that, we would have been above the high end of our guidance range, and we'll recapture that value sitting here in 2026. So the incrementals would have been better than reported in Q4 and in the full year absent that. And as we roll into 2026, we expect the incremental margins to be more normal in the electronics business and across all of the element. We've talked about a 30% to 40% incremental in normal times, and there's no reason that that has changed.

All right. And then just a second question here. There are some concerns about rising memory prices and potential shortages and the impact that could have on logic demand in areas like consumer electronics or automotive or industrial applications within Semicon. How do you see higher memory prices affecting ESI's electronics business as we move forward in 26th?

Yeah, so we don't want to be dismissive of that risk as a real risk that memory prices will rise and correspondingly consumer electronics prices will rise and that will have an impact on demand. But that's really looking at a single variable, and it's a multivariable equation, which is to say the reason that memory prices are rising is because capacity is constrained by the surge in demand from data center applications. And we're beneficiaries of that surge in demand. You see it in the P&L, and you saw the acceleration in all of our electronics businesses here in Q4. We have more value on a high-end server board for a data center than in a PC or a smartphone. And so, insofar as memory prices are rising and that's having a negative impact on consumer electronics, it should be associated with a correspondingly positive impact in the data center market, which will benefit Element. So, I don't want to dismiss that as a risk. It's something we're keeping an eye on. Our underlying forecast for 2026 doesn't have strong growth assumptions for the smartphone market or consumer electronics more broadly, but it does have quite strong growth assumptions associated with the data center market, which we're seeing, you know, on the ground here Your next question comes from the line of Alex C. E-Free Move with KeyBank Capital Markets.

Please go ahead.

Thank you. Good morning, everyone. Ben, can you just talk about the new product adoption in 26? Do you expect that process to be accelerating in 26 versus 25? And as a result, your outgross versus the market, would it increase in 26 versus 25?

Is that a question about our new products or supply chain new products, Alexi?

Your new product, then?

Yeah. So, historically, Element hasn't really been a blockbuster product-type company, right? We have a lot of product proliferation because our solutions are very much customized to customer-specific requirements. That having been said, over the past several years, we've had real traction in a couple of areas in power electronics. We've talked about Coupriant as a compelling value proposition in a product we're ramping. And then a few other areas around die-attached solutions and some new introductions around circuit board fabrication and some thermal materials. Those are responsible for some of our outgrowth relative to the market. The other thing to think about is just that our technology skews towards higher-end applications, and those are outgrowing relative to the market. And both of those things will be true in 2026 as they were in 2025. Our circuitry business skews towards the highest end, highest value circuit boards, which are growing well in excess of the market. Our power electronics business is gaining share in excess of the automotive market, as an example, and growing much faster than your semi-assembly market. We have seen real traction with ArgoMax in proliferating our customer base, And that's a business where outside of our original core customer, we're seeing 20-plus percent growth in the back half of 2025. We expect that to continue. And on and on. You know, Couprion also contributes to that where we should see a ramp in sales over the course of 2026, which would be idiosyncratic to the overall market. So I'd say there are multiple factors that support our ability to outgrow end market indicators in the medium and long term. And we've got high confidence, I would say growing confidence, in our ability to continue that coming out of 2025.

Thanks, Ben. And a bit of a crystal ball question. You grew organically 13% in electronics in Q4. You got into high single digit in 2026. is something in the low teams in terms of growth for this segment within reach, within the range of outcomes in your view if we're thinking about bulk-case scenarios?

Ultimately, we're in a units-driven business that's short cycle. And so what we target is to outperform our end markets, you know, by two or three points through the cycle. And so the cycle is going to be the driver. or underlying unit demand is going to be the driver. And if we see a continuation of what we're seeing in the data center market, if we see a modestly better smartphone market than expected, yeah, you could see a continuation of double-digit organic growth on the top line for our electronics business. But as you know us, we tend to, given the visibility in this business, not guide towards the bull case, guide towards sort of shared down the fairway market expectations and market expectations. Makes sense.

Okay. Thanks a lot.

Your next question comes from the line of Chris Parkins with Wolf Research. Please go ahead.

Great. Thank you so much. Ben, you hit on this as early as the circuitry a couple questions ago, but can you sit on assembly and semi just given, you know, your portfolio has been constantly evolving in many ways away from just baseline consumer electronics as well as handsets, but, you know, across the electronic segment, you know, how should we think about the relative growth rates embedded in your guidance, you know, for instance, you know, HPC data center and, you know, advanced packaging versus some of the more, you know, legacy end markets? And do you feel that buy-sides, you know, fully appreciates that evolution?

Thank you. Yeah, thanks for the question, Chris. You know, historically, the semi-business and the semi-market was assumed to grow faster than the printed circuit board market and the printed circuit board business. But for the past three years, we've seen PCB square meters exceed or growth, exceed MSI growth. And so our printed circuit board business has seen a real acceleration. And looking ahead into 2026, the market or industry experts expect the PCB market to outgrow MSI once again, which is a good harbinger for our circuitry business. And we've been outgrowing MSI by a greater delta than we have PCB square meters, right? So, PCB square meters were high single-digit growers, and we were 10% in circuitry this year, and MSI was mid-single-digit, and our semi-business grew in the low teens. So, as we look to 2026, you know, we would expect similar degrees of outperformance relative to underlying growth. The industry is expecting 6-ish percent PCB growth in 2026, which would be a bit of a deceleration. And so, we see a potential room for upside there, but our guide doesn't contemplate that. The semi-market is expecting similar year-on-year growth, And, you know, we believe we can outperform by a similar delta in 2026 driven by what we see in Power Electronics and some of the other new product introductions we have. The more surprising growth vector has been our assembly business, which we historically would have thought would grow roughly in line with, or the market driver would be electronic systems growth, which was a, you know, low to mid single digit grower and has really accelerated here in 2025. And our business has, you know, substantially outperformed that, growing in the high single digits. And that's because we've introduced some new products, higher reliability solders, finer solder pastes, preforms, which are used in high-end server boards to, you know, keep the chips flat on, you know, because the chips have gotten so big. So we've got some really interesting engineered materials that keep chips flat on the highest-end server boards going into data centers. So, our overall electronics business is benefiting from advances in technology and accelerating. And so, yeah, we do believe the portfolio has improved from a quality perspective and will continue to.

All right. And just shifting back to Kuprian, I understand, you know, 26 is still very, very early, and there's still some growth investments. But can you just comment, you know, based on what you're hearing from customers and the potential demand flow from both of your facilities, can you just remind us on kind of where you stand in that process as well as what you perceive to be the current customer receptiveness, you know, to that product portfolio?

Thank you. Yeah, thanks for the question, Chris. So, Kuprian is really exciting and we're in the crucible here as we're beginning to ramp production at our first, you know, significant site in California. And at the moment, you know, the pipeline of demand exceeds our production capacity based on this first site. Now, we need to ramp that. We need to convert that pipeline into high-volume manufacturing at the customer level. But we're progressing on planning the second site already on the back of the robustness of the demand for this capability. So we are in the crucible. So customer receptivity, customer pull remains exceptionally strong, and we're still, you know, deep in getting the supply chain set up to meet that demand. Thank you.

Your next question comes from the line of Josh Spector with UBS. Please go ahead.

Yeah, hi. I wanted to ask just on your 1Q guidance, you know, your range is wider than what you typically give. Can you talk about why that is and, you know, what drives the upper versus lower end?

Yeah, thanks for the question, Josh. The range is wider than typical because of metal price impacts. So we saw a significant increase in metal prices, tin and silver, in January. And so that same impact we talked about in Q4 may recur in Q1, but it may also unwind in Q1 if metal prices stabilize. And so that creates a little bit of variability, as I said in the prepared remarks around seasonality of the business. That's the biggest needle mover. The second is acquisitions and, you know, how they feather in from a seasonal perspective, right? This is our first quarter owning Micromax and EFC. And so we gave ourselves a little bit of a wider berth around, you know, the seasonality in those businesses.

Thanks. That makes sense. I'll leave it there. Thanks, Josh.

Your next question comes from the line of Bavish Ladoya with BMO Capital Markets. Please go ahead.

Hi. Good morning, Ben. Can you share some thoughts on why the specialty segment was the right place for EFC? And then do you expect the overall segment to grow at your mid-single digits guidance for this year?

Yeah. ESC is a great niche business with highly technical, highly qualified products in a wide range of industries, and it could have fit within both segments. The way we're running it as an autonomous unit and the breadth of end markets it's supplying is why it landed in our specialties segment. It accelerates the growth of the specialty segment. It also improves the margins of the specialty segment. So, as we look out to 2026, it's value enhancing to the specialty segment and quality enhancing. So, you'll see that feather in as well. When we look into 2026 for that segment, we talked about end market conditions being similar to 2025, which is, you know, uninspiring end market growth in the industrial vertical, but an opportunity to make that business better and grow profits. The offshore business continues to be robust, and the EFC business is growing very, very nicely. And so from an EBITDA growth perspective, we could repeat, you know, the mid-single-digit growth we delivered in 2025.

Got it. And then maybe on your acquisitions, MicroMax EFC, how did they perform in 2025? Does your guide include them as still at 70 million EBITDA? And maybe also, I think in your prepared remarks, you mentioned some untapped commercial opportunities. Is that something we see in 26? Thank you.

Yeah. So, when we announced MicroMax, we said it was roughly 40 million of EBITDA on 25. And EFC, we said it was roughly 30 million, we expected roughly 30 million in 26, right? And so, you know, that's the roughly $70 million of contribution in 26 is adding those two with some modest growth and a little bit of conservatism as we navigate integrations. The MicroMax business outgrew our expectations in 2025. Organic revenue growth was north of 10% for MicroMax. So, you know, there were some questions about its ability to grow, and I think it disproved them in the early days in 2025. And we're seeing a really robust start to the year for that business here in 2026. Also for EFC, a month doesn't make a trend, but both of them are outperforming our initial expectations. The integrations are going really well. The folks at Micromax are incredibly excited to be a part of an electronics-oriented company. and we have just in the first days of integration identified several areas where collaboration and relationships, you know, discreet relationships their organization has and our organization has will yield what we believe will be better commercial outcomes for both businesses. So that's what we were referring to, to untapped commercial opportunities. We see our ability to make these businesses better as part of Element as quite compelling over and above the high-quality businesses they were independently.

Thank you. Your next question comes from the line of Matthew Dayo with Bank of America. Please go ahead.

Morning, everyone. Morning, Matt. Ben, so I think you would share this with me, right? So the Taiwan Printed Circuit Board Association, right, calling for the PCB market to be up 14% in 2026. I mean, is it reasonable to assume this is like a base case for your associated volumes? Obviously, you can make maybe your own assumptions on the end markets, but like presumably you would also expect to outgrow this. And how do you factor in an outlook like that into how you perceive your own business performance?

So we use Prismark data as our baseline, and Prismark is talking about a 6% year in 2026, a 9% CAGR from 24 to 29. And so that's what we benchmark ourselves against. It's important to look at meters squared versus dollar value. So a lot of the PCBs that are being produced today, a lot of where the growth is coming from is really high-value, complex boards. Now, that's good for us because that's higher margin sales, but we're not driven by the dollar value of the circuit board. We're driven by the volume of circuit boards being produced. And so, that might be the reconciling figure. There's, you know, there's a bull case in the circuit board market right now, given the acceleration of investment in data center capacity. And, you know, we were in Asia in early January, and the level of activity was unbelievable and super exciting. But as we look to 2026, we're looking at that 6% number. That's what we're building off of.

All right. I appreciate that. And I think in the call I heard 7% organic growth in energy solutions. So the comment seemed maybe to be a decent amount price-driven. Can you break down price volume in here, and should we kind of assume this price annualizes in 26? Is this – I know this is a pretty solid business for you. Is this kind of priced in excess of raws, or is there some obscure raw material that I don't know of that's up, you know, materially? I'm just trying to chart the course for next year.

Yeah, the offshore business is a wonderful business. And I would say of the 7%, it's about half and half price volume growth. growth, and this is one of those businesses where there is a bit more of a pricing lever available to us, and it's one where we're building that muscle as appropriate. You know, entering 2026, we were a little cautious, I would say, about volumes there. Energy price had been a little low. We saw some projects potentially shifting out to the right, but, you know, it should be a mid-single-digit grower between price and volume next year again. All right, thank you.

Your next question comes from the line of John Roberts with Mijuho. Please go ahead.

Thank you, and nice results. Is Kupryon used in co-package optics where they're using glass as a substrate?

So today, Kupryon isn't used in high-volume manufacturing anywhere. It has applications in through-glass vias, which are the core layers for some of the highest-end printed circuit boards, and it solves a major customer pain point there. That's just one of many potential markets for it.

Okay. And how do we think about wafer-level packaging? Like, what are your key products that would be used in that application?

So we have wafer plating products that go onto the backside of wafers for packaging applications. We have advanced interconnect products that are used for copper pillars and barrier layers. We have printed circuit board chemistries for the highest-end printed circuit boards that are used in packages. So wafer-level packaging, advanced packaging, that is right at the sort of center of the Venn diagram of our capabilities and our solution sets for foundries and OSATs and the associated supply chain.

Is there a way to scope the size of that opportunity?

So we have a specific business we call wafer-level packaging, which is about $150 million of revenue. It's actually, you know, bumping up against 200 now that we've seen some precious metal price increases, and there are some precious metals in there that are not reported as pass-through. And then we've got, you know, ancillary products that go into advanced packaging applications, you know, which would, you know, bring our advanced packaging revenue, you know, to the multiple hundreds of millions. But, again, these are generic terms, and so, you know, it's hard to be too precise. Thank you.

Your next question comes to the line of Duffy Fisher with Goldman Sachs. Please go ahead.

Yeah, good morning. Just wanted to follow up. I think Carrie in the prepared remarks talked about a large customer contract, and I wasn't clear. It seemed like there was some distortion from that either currently or in the future, But could you just walk through what that is, the size, and kind of how that impacts the P&L?

So in Q3 of 2024, we sold a large equipment line to a customer that was building manufacturing capacity in the industrial business in Mexico. And so that was large revenue with lower margin on the equipment. And we didn't make the equipment, by the way. We purchased it on their behalf in exchange for a multi-year high-margin contract. It was a big market share win for us and a short payback period. So when you look at the year-over-year in Q3 and on a full-year basis, there was a revenue contribution at lower margin in 24, which was replaced by higher margin chemistry sales in 25. Okay, great.

And then can you remind us on Couprion, if the plant runs as you expect, how long will it take, do you think, to sell the first plant out? And then roughly what's the contribution from the first plant, you know, when it's at full operating rates?

There are a lot of assumptions embedded in that. And so, you know, we don't want to be too precise. What I would say is we have a pipeline today for volumes in excess of that plant. The ramp of that plant, we should be ramped, you know, to full production in the second half of this year. And it will come at pretty compelling incremental margins. What we've guided to is, you know, multiple millions of dollars of revenue in 26 and, and, you know, a material contribution to EBITDA from this in 2017. Great. Thank you, guys. Thank you.

Your next question comes from the line of Pete Osterlin with Truist Securities. Please go ahead.

Hey, good morning, guys. Thanks for checking the questions. I just wanted to follow up on some of your comments around specialties. What are your expectations around segment margins in 2026, excluding the impact of the EFC acquisition? I guess it's stable to slightly higher, a reasonable expectation given what sounds like continued growth in offshore. Are there any other major puts and takes to call out for margin performance in that business this year?

No, I think that we would expect that business to be expanding margins if we're going to deliver mid-single-digit growth, given the end market outlook for the segment overall XEFC.

Okay. And then just given some of the dynamics you've called out with working capital and the higher capex you're guiding for 2026, what are you targeting for free cash flow generation in 2026? do you have a target in terms of EBITDA conversion you can share?

Yeah, I think consistent with prior years, we target roughly a 50% conversion of EBITDA free cash flow. You know, to your point, the dynamics around metal pricing puts some seasonality questions in that, but ultimately on a full-year basis, I would expect by around 50%, maybe just a tick lower. Great. Thanks a lot.

And your final question comes from the line of Frank Mitch with Ferium Research. Please go ahead.

Thank you so much. Obviously, very busy start to the year with the acquisitions, and you offered some very constructive comments on how they're trending so far. I was wondering if you could expand upon your thoughts on top-line synergies for both as we progress through this year and into next year. How should we think about, you know, the longer-term implications for the top-line synergies between, you know, Micromax, EFC, and government?

Yeah. Thanks for the question, Frank. You know, it's really hard to underwrite to revenue synergies because they're sort of hard to prove out. And we're in businesses that have long sales cycles, especially when you think about EFC and Micromax. It's highly qualified products. And so, you know, it's hard to say in 2026, we're going to see material revenue synergies. But what we've said repeatedly is that these are, these businesses are better inside of Element than outside. And so, in both cases, there's not a huge amount of cost synergy we're driving from It's, you know, being a part of a larger electronics organization and the resources and relationships that we can bring to bear to support those businesses. And we're already starting to see that, and the collaboration and joint customer visits, you know, is just beginning. And so, we believe that the MicroMax business will grow faster than it would have independently. EFC doesn't need any help growing faster, but, you know, we do believe that the relationships we have, and frankly, some of the relationships they have will help accelerate growth in both businesses. And so, you know, we do expect to see an acceleration overall from what you might call revenue synergies, but it's hard to quantify that and put time bounds on it. Okay, got you.

So at this point, the trend is positive, joint customer visits, et cetera, but you're too early to try and throw some numbers to it. And then just lastly, I mean, I believe you said before that the capital intensity of Micromax was similar to Element Solutions. I assume that that's similar for EFC as well.

I wish – just going back to that question, I wish I could say that one or two months into 2026, post-closing, you know, we're responsible for the strength in the businesses we're seeing. But, you know, that's just the quality of the businesses and the end market they're participating in. With regard to capital intensity, MicroMax is similar to ESI overall. EFC is modestly more capital intensive, but it's a smaller business. And, again, you know, we're guiding to $75 million in CapEx this year. We should comfortably cover it.

Yeah, and I would just add that the returns on capital in that business, BFC in particular, are as high, if not higher, just given the profitability. Thanks so much. Thanks, Frank.

I will now turn the call back over to Ben Glicklish for closing remarks.

Well, thank you, Rebecca, and thank you, everybody, for joining. Have a great day.

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect. Good morning, ladies and gentlemen, and welcome to the Element Solutions Fourth Quarter and Full Year 2025 Financial Results Conference Call. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. Thank you. I will now turn the call over to Veirun Gokharn, Vice President, Strategy and Interrogation. Please go ahead.

Good morning, and thank you for participating in our fourth quarter and full year 2025 earnings conference call. Joining me today are our CEO, Ben Glicklich, and our CFO, Carrie Dorman. In accordance with RegulationFD, we are webcasting this conference call. A replay will be made available in the Investors section of the company's website. During today's call, we will make certain forward-looking statements that reflect our current views about the company's future performance and financial results. These statements are based on assumptions and expectations of future events which are subject to risks and uncertainties. Please refer to the Investors section of our website for a discussion of material risk factors that can cause actual results to differ from our expectations. Today's materials include financial information that has not been prepared in accordance with U.S. GAAP. Please refer to the earnings release and supplemental slides for definitions and reconciliations of these non-GAAP measures to comparable GAAP financial measures. It is now my pleasure to introduce our CEO, Ben Glicklage.

Thank you, Varun. Good morning, everyone. Thank you for joining. Element Solutions had another record year in 2025. We executed our model marrying operational excellence and prudent capital allocation to deliver record results while accelerating investment in future growth. The company is benefiting from its position as a solutions partner across the electronics manufacturing supply chain and also strengthening it. Our portfolio breadth, strategic positioning, and high-value growth niches and deep technical expertise have accelerated opportunities for our businesses. We see that in the results we are reporting today and the activity levels at our customers as we enter 2026. In the past year, demand from data center and high-performance computing markets drove 10% organic revenue growth in our electronics business, a trend that accelerated in the fourth quarter. Our electronic solutions and our people enable the increasing performance that our markets demand, as well as faster product iterations and significant advances in reliability and complexity. Customer engagement is as strong as ever, partially driven by our pipeline of new, exciting products. Overall, our company achieved record-adjusted EBITDA and record-adjusted EPS in 2025, despite continued industrial weakness and the divestiture of the graphics business in the first quarter. Our focus on operational excellence means we strongly believe that each of our businesses can improve every year, regardless of the macro environment. We demonstrated that over the past 12 months in our newly renamed specialty segment, where margins expanded 250 basis points driven by higher value selling, supply chain initiatives, cost efficiencies, and portfolio optimization. The businesses that comprise the specialty segment focus on attractive niche markets with demanding customer qualification requirements and an emphasis on value-added technical service. This creates high margin recurring revenue streams, and we've demonstrated the ability to grow our profits in these businesses, even when volumes are soft. We believe we can continue to drive profit growth through share gains and productivity improvements until industrial and markets inevitably recover. We enhanced our portfolio in 2025 through prudent capital allocation. In the first quarter of last year, we divested our slower-growth, relatively lower-value flexographic printing business and redeployed that capital into two value-enhancing transactions that expand our presence in attractive electronics-focused growth adjacencies. We announced the acquisitions of both Micromax and EFC gases and advanced materials in the fourth quarter and closed them both in early 2026. We believe that within the ESI family, these businesses will have the opportunity to flourish and grow faster and more efficiently. MicroMax is a global leader in advanced electronics ink and pastes, as well as low-temperature ceramic materials, essential for the most demanding electronics applications. The acquisition enhances our leadership position and technical bona fides in the electronics supply chain. MicroMax's innovation and go-to-market capabilities align with our customer-centric approach, enabling us to deliver next-generation materials for high-growth applications such as satellites, electric vehicles, and data centers. Our initial weeks together have reinforced our excitement for the product portfolio and the untapped commercial opportunities that can be unlocked in the years ahead as part of a larger electronics materials company. EFC provides high-purity specialty gases and advanced materials that are essential for certain high-value, high cost of failure applications requiring stringent purity and performance standards. The business is concentrated in fast-growing markets such as semiconductor fabrication, electrical infrastructure, and satellite propulsion. It has grown at a revenue CAGR in excess of 15 percent since 2009, with growth accelerating recently primarily in semiconductor applications. EFC's focus on niche high value products and people centricity has yielded commercial momentum and a pipeline of customer qualifications that we anticipate will translate into robust earnings growth in the coming years. And their team is a great cultural fit with ours. The business is off to a very strong start in 2026. Taken together we had an outstanding year with demand and improving sequentially throughout. That sets us up well for 2026. Kari will now take you through the fourth quarter and pull your financials in more detail, Kari. Thanks, Ben, and good morning.

On slide four, you can see a summary of our fourth quarter results. Net sales increased 10% organically, led by high-end electronics growth, primarily from AI and data center investments. Electronic segment organic growth was 13%, with all three business verticals growing in the double digits. The circuitry business has been a large beneficiary of AI-related investments, as our market-leading pulse-plating chemistry is used to support fabrication of high-layer count server boards. Assembly Solutions saw similar benefits from both consumer electronics and high-performance computing applications. It drove 12% organic growth in the quarter. Finally, our semiconductor solutions business grew 13% organically, as advanced packaging applications drove demand for wafer-level plating chemistries and power electronics sales returned to growth on the back of new customer wins. Specialties organic growth was 4%, with modest volume improvement in core industrial and 9% year-over-year growth in energy solutions. Adjusted EBIT after the quarter was $136 million, up 8% year-over-year on a constant currency basis, when excluding the impact of divestitures. Higher pass-through metals in our assembly business created an optical margin headwind of roughly 1% in the fourth quarter. Excluding net sales from these pass-through metals, adjusted EBITDA margin would have been 25.5%, representing a 40 base point improvement year on year. The rapid increase in metal prices in the fourth quarter, particularly silver and tin, also had a negative impact on adjusted EBITDA of several million dollars. This is simply a timing impact, and those earnings should be recaptured in 2026 as inventory sells through and metal prices stabilize. We would have seen stronger incremental margins without this impact. On slide five, we discussed full-year financial results. Net sales for 2025 were $2.6 billion, growing 6% organically. Electronics net sales increased 10% organically, driven by strength in AI and data center markets, demand for advanced packaging metallization solutions, and growth with new EV customers. Specialties grew 1% organically, as offshore hydraulic production fluid growth remained robust. In industrial surface treatment, strong automotive growth in Asia and new customer wins later in the year offsets overall sluggish Western industrial markets. Adjusted EBITDA for the year was $548 million, which represents 7% constant currency growth when excluding the impact of the graphics divestiture. Excluding net sales from assembly pastured metals, adjusted EBITDA margin would have been 26.5%, a 60 basis point increase year over year. Once again, this margin would have been higher if not for the earnings timing impact associated with the steep increase in metal prices during 2025 and particularly in Q4. Finally, we delivered record-adjusted EPS for the year of $1.49, despite the graphics divestiture. Next, on slide six, we share additional details on full-year organic growth by business. Our assembly solutions business has a relatively diversified set of end markets, with larger exposure to industrial, consumer electronics, and automotive applications than our other electronics verticals. In 2025, this business grew organically at 8%, with the outperformance driven by strong consumer electronics and automotive demand in Asia, particularly in the first half of the year, and increased demand for engineered preformed materials used in high-performance computing applications. Circuitry Solutions delivered robust organic growth of 10% for the year, supported by investments in high-performance computing and data center infrastructure. We have industry-leading metallization solutions for the fabrication of dense, high aspect ratio circuit board that are uniquely suited for the extreme requirements of data centers. In addition, our solutions for data storage, EV electronics, and low-Earth orbit satellites provided additional growth vectors. This year, we also focused on investments intended to meaningfully strengthen our presence in Southeast Asia, a region that should see continued momentum in the years ahead as the electronic supply chain seeks to diversify its manufacturing footprint. Semiconductor solutions grew 13% organics a year over year, reflecting strong demand from advanced packaging metallization solutions and power electronics growth with new EV customers. This is the second consecutive year of mid-teens organic growth for this business. Demand remains robust across all our product lines, and the opportunity pipeline continues to expand. Our customers are performing well with our technologies. For example, our top Viaform copper gamethane customers grew 20% on average for the year, and we expect this trend to continue in 2026. We've introduced multiple new product families that are gaining customer traction and see opportunities to grow in areas that intersect with printed circuit board metallization. such as IC substrate and large format panels. Turning to the specialty segment, organic growth of 1% reflects softness in industrial oriented end markets. Energy solutions remained a bright spot, growing 7% organically as we saw continued production fluid revenue growth due to competitive wins and pricing activities. Our core industrial surface treatment business was flat organically for the year on the top line. Underlying volume growth in Asia, automotive end market, was offset by lower European industrial activity. Net sales growth comparisons were impacted by a large customer equipment deal in the third quarter of last year, which is tied to a high-value, multi-year chemistry contract. Moving to cash flow in the balance sheet on slide seven, we generated $256 million of adjusted free cash flow in a year, with $83 million of cash generated in the fourth quarter. Working capital investment in the fourth quarter was higher than we expected due to the rapid increase in tin and precious metal prices and the timing of our hedge settlements. Higher metal prices, even though they are passed through, tie up more capital, all else being equal. However, all else is not equal. Over the past several years, we have worked on optimizing our inventory on a volume basis. Consequently, we have seen solid improvements in both inventory days and overall cash inversions. When the model prices eventually normalize, we expect to see a benefit to cash flow. We invested $61 million in net capex in 2025, advancing key strategic projects such as Cuprion and new advanced packaging product manufacturing, as well as our global R&D and production footprint. These investments support high-value growth opportunities and technology leadership in our electronics segment. For 2026, we expect capital expenditures of approximately $75 million, affecting our continued commitment to innovation, capacity expansion where necessary, and new product introductions in fast-growing AI and data center markets primarily. This figure includes the expected capital requirements of our newly acquired businesses. We ended 2025 with a strong balance sheet, including $627 million in cash and a net debt to adjusted EBITDA ratio of 1.8 times. When we closed our two acquisitions earlier in Q1 this year, we paid approximately $870 million, which was funded in part by a new $450 million term loan add-on. Overall, our debt is currently 95% fixed, and our cost of debt remains roughly 4%. Today, pro forma leverage is slightly above three times, which we expect to approach two and a half times by year end in 2026, assuming no further capital allocation. Our liquidity and financial flexibility position us well to fund organic growth, strategic M&A, and capital return to shareholders as appropriate. With that, I will turn the call back to Ben to discuss our outlook.

Thank you, Kerry. Looking ahead to 2026, we expect market conditions to largely resemble late 2025, with continued strength in high-performance computing and leading-edge electronics and slower industrial markets. There will be noise on the top line driven by metals price volatility, which may also have a bearing on our adjusted EBITDA seasonality and short-term cash flow. But in the fullness of time, these are only timing differences with no impact on overall profit dollars. Our 2026 adjusted EBITDA guidance range is $650 to $670 million, inclusive of the expected contributions from the EFC and Micromax acquisitions and assuming current FX rates and metal prices. This range includes a modest year-over-year FX tailwind and an expected $5 million headwind as we lap the 2025 stub period contribution from our graphics business, together implying high-single-digit organic adjusted EVA growth. This also translates to adjusted EPS growth in the mid-to-high teens. Our focus in 2026 will be similar to prior years, with the only adjustment relating to our recent acquisitions. The emphasis will be on operational excellence, integrating EFC and Micromax, and scaling capacity for new products. We've made product qualification milestone payments in the first quarter of this year for Couprion and are in the final innings before ramping capacity at our first site in California. We have other compelling product launches underway in thermal materials, die-attached, and circuit board fabrication. We also retain and will build capacity for further accretive capital deployment should attractive opportunities come available. We have strong customer partnerships, a clear strategy, and a growing, high-performing team that is enthusiastic and incentivized to continue to execute on the momentum we have. We're a people-powered company, and I'm grateful for the extraordinary talent that is responsible for a great 2025 and focused on another record year in 2026. Operator, please open the line for questions.

At this time, I would like to remind everyone, in order to ask a question, press star, then the number one on your telephone keypad. We'll pause for a moment to compile the Q&A roster. Your first question comes from the line of Mike Harrison with Seaport Research Partners. Please go ahead.

Hi, good morning. Congrats on a nice finish to the year. Thanks, Mike. I wanted to start with the electronics business and just the margin performance there. If we adjust for that metal price pass through, it was still relatively weak. It sounds like maybe the metal price spike or kind of the significant rise that you saw in metal prices were also a drag on margins. So I was hoping you could talk about that. But maybe also just if we kind of excluded that metal price impact completely, you know, what were you seeing in terms of underlying margin performance as it related to, you know, operational efficiency, mix, your cost structure, any other factors that we would think about kind of the underlying sustainability of margin performance into next year, or into 26th, I should say.

Thanks for the question, Mike. You know, there are a few things impacting margin in the quarter and in the year. We talked about a corp allocation shift as subsequent to the sale of our graphics business. That had a bearing. We talked about ramping up investment primarily in Couprion, which is just OPEX, as we prepared to ramp that. And then the third variable, which was a new variable here in Q4 and really in December, was this metal pricing dynamic where the spike in metal prices and the associated hedge losses that occurred in Q4 and were more acutely in December had a several million dollar hit to the P&L. Absent that, we would have been above the high end of our guidance range, and we'll recapture that value sitting here in 2026. So, the incrementals would have been better than reported in Q4 and in the full year absent that, and as we roll into 2026, we expect the incremental margins to be more normal in the electronics business and across all of Element. We've talked about a 30 to 40 percent incremental in normal times, and there's no reason that that has changed.

All right. And then just a second question here, there are some concerns about rising memory prices and potential shortages and the impact that could have on logic demand in areas like consumer electronics or automotive or industrial applications within Semicon. How do you see higher memory prices affecting ESI's electronics business as we move forward in 26?

Yeah, so we don't want to be dismissive of that risk. That's a real risk that memory prices will rise and correspondingly consumer electronics prices will rise and that will have an impact on demand. But that's really looking at a single variable, and it's a multivariable equation, which is to say the reason that memory prices are rising is because capacity is constrained by the surge in demand from data center applications. And we're beneficiaries of that surge in demand. You see it in the P&L, and you saw the acceleration in all of our electronics businesses here in Q4. We have more value on a high-end server board for a data center than in a PC or a smartphone. And so, insofar as memory prices are rising and that's having a negative impact on consumer electronics, it should be associated with a correspondingly positive impact in the data center market, which will benefit Element. So, I don't want to dismiss that as a risk. It's something we're keeping an eye on. Our underlying forecast for 2026 doesn't have strong growth assumptions for the smartphone market or consumer electronics more broadly, but it does have quite strong growth assumptions associated with the data center market, which we're seeing, you know, on the ground here today.

Your next question comes from the line of Alex C. E-Free Move with KeyBank Capital Markets. Please go ahead.

Thank you. Good morning, everyone. Ben, can you just talk about the new product adoption in 26, do you expect that process to be accelerating in 26 versus 25, and as a result, your outgross versus the market, would it increase in 26 versus 25?

Is that a question about our new products or supply chain new products, Alexei?

Your new products, Ben.

Yeah. So, historically, Element hasn't really been a blockbuster product-type company, right? We have a lot of product proliferation because our solutions are very much customized to customer-specific requirements. That having been said, over the past several years, we've had real traction in a couple of areas in power electronics. We've talked about Couprion as a compelling value proposition in a product we're ramping, And then a few other areas around die-attached solutions and some new introductions around circuit board fabrication and some thermal materials. Those are responsible for some of our outgrowth relative to the market. The other thing to think about is just that our technology skews towards higher-end applications, and those are outgrowing relative to the market. And both of those things will be true in 2026 as they were in 2025. Our circuitry business skews towards the highest end, highest value circuit boards, which are growing well in excess of the market. Our power electronics business is gaining share in excess of the automotive market, as an example, and growing much faster than your semi-assembly market. We have seen real traction with ArgoMax in proliferating our customer base. And that's a business where outside of our original core customer, we're seeing 20-plus percent growth in the back half of 2025. We expect that to continue. And on and on. You know, Coupriant also contributes to that where we should see a ramp in sales over the course of 2026, which would be idiosyncratic to the overall market. So I'd say there are multiple factors that support our ability to outgrow end market indicators in the median and long term. And we've got high confidence, I would say growing confidence, in our ability to continue that coming out of 2025.

Thanks, Ben. And a bit of a crystal ball question. You grew organically 13% in electronics in Q4. You got into high single digit in 2026. is something in the low teams in terms of growth for this segment within reach, within the range of outcomes, any of you, if we're thinking about both case scenarios?

Ultimately, we're in a units-driven business that's short cycle. And so what we target is to outperform our end markets, you know, by two or three points through the cycle. And so the cycle is going to be the driver. or underlying unit demand is going to be the driver. And if we see a continuation of what we're seeing in the data center market, if we see a, you know, modestly better smartphone market than expected, yeah, you could see a continuation of double-digit organic growth on the top line for our electronics business. But as you know us, we tend to, given the visibility in this business, not guide towards the bull case, guide towards sort of shared down the fairway market expectations and market expectations. Makes sense.

Okay. Thanks a lot.

Your next question comes from the line of Chris Parkins with Wolf Research. Please go ahead.

Great. Thank you so much. Ben, you hit on this as early as the circuitry a couple questions ago, but can you come on Semblins and Semi just given, you know, your portfolio has been constantly evolving in many ways away from just baseline consumer electronics as well as handsets. But, you know, across the electronic segment, you know, how should we think about the relative growth rates embedded in your guidance? You know, for instance, you know, HPC data center and, you know, advanced packaging versus some of the more, you know, legacy end markets? And do you feel that buy-sides, you know, fully appreciates that evolution?

Thank you. Yeah, thanks for the question, Chris. You know, historically, the semi-business and the semi-market was assumed to grow faster than the printed circuit board market and the printed circuit board business. But for the past three years, we've seen PCB square meters exceed or growth, exceed MSI growth. And so our printed circuit board business has seen a real acceleration. And looking ahead into 2026, the market or industry experts expect the PCB market to outgrow MSI once again, which is a good harbinger for our circuitry business. And we've been outgrowing MSI by a greater delta than we have PCB square meters, right? So, PCB square meters were high single-digit growers, and we were 10% in circuitry this year, and MSI was mid-single-digit, and our semi-business grew in the low teens. So, as we look to 2026, you know, we would expect similar degrees of outperformance relative to underlying growth. The industry is expecting six-ish percent PCB growth in 2026, which would be a bit of a deceleration. And so, we see a potential room for upside there, but our guide doesn't contemplate that. The semi-market is expecting similar year-on-year growth, and, you know, we believe we can outperform by a similar delta in 2026, driven by what we see in power electronics and some of the other new product introductions we have. The more surprising growth vector has been our assembly business, which we historically would have thought would grow roughly in line with, or the market driver would be electronic systems growth, which was a, you know, low to mid single digit grower and has really accelerated here in 2025. And our business has, you know, substantially outperformed that growing in the high single digits, and that's because we've introduced some new products, higher reliability solders, finer solder pastes, preforms, which are used in high-end server boards to, you know, keep the chips flat on, you know, because the chips have gotten so big. So we've got some really interesting engineered materials that keep chips flat on the highest-end server boards going into data centers. So, our overall electronics business is benefiting from advances in technology and accelerating. And so, yeah, we do believe the portfolio has improved from a quality perspective and will continue to.

All right. And just shifting back to Kuprian, I understand, you know, 26 is still very, very early, and there's still some growth investments. But do you just comment, you know, based on what you're hearing from customers and the potential demand pull from both of your facilities, can you just remind us on kind of where you stand in that process as well as what you perceive to be the current customer receptiveness, you know, to that product portfolio?

Thank you. Yeah, thanks for the question, Chris. So, Kuprian is really exciting and we're in the crucible here as we're beginning to ramp production at our first, you know, significant site in California. And at the moment, you know, the pipeline of demand exceeds our production capacity based on this first site. Now, we need to ramp that and we need to convert that pipeline into high volume manufacturing at the customer level. But we're progressing on planning the second site already on the back of the robustness of the demand for this capability. So, we are in the crucible, customer receptivity, customer pull remains exceptionally strong and we're still, you know, deep in getting the supply chain set up to meet that demand. Thank you.

Your next question comes from the line of Josh Spector with UBS. Please go ahead.

Yeah, hi, good morning. I wanted to ask just on your 1Q guidance, you know, your range is wider than what you typically give. Can you talk about why that is and, you know, what drives the upper versus lower end?

Yeah, thanks for the question, Josh. The range is wider than typical because of metal price impacts. So, we saw a significant increase in metal prices, tin and silver, in January. And so, that same impact we talked about in Q4 may recur in Q1, but it may also unwind in Q1 if metal prices stabilize. And so, that creates a little bit of variability, as I said in the prepared remarks. around seasonality of the business. That's the biggest needle mover. The second is acquisitions and, you know, how they feather in from a seasonal perspective, right? This is our first quarter owning Micromax and EFC, and so we gave ourselves a little bit of a wider berth around, you know, the seasonality in those businesses.

Thanks. That makes sense. I'll leave it there. Thanks, Josh.

Your next question comes from the line of Bavish Ladoya with BMO Capital Markets. Please go ahead.

Good morning, Ben. Could you share some thoughts on why the specialty segment was the right place for EFC? And then do you expect the oral segment to grow at your mid-single-digit guidance for Yeah.

ESC is a great niche business with highly technical, highly qualified products in a wide range of industries, and it could have fit within both segments. The way we're running it as an autonomous unit and the breadth of end markets it's supplying is why it landed in our specialties segment. It accelerates the growth of the specialty segment. It also improves the margins of the specialty segment. So as we look out to 2026, it's value enhancing to the specialty segment and quality enhancing. So you'll see that feather in as well. When we look into 2026 for that segment, we talked about end market conditions being similar to 2025, which is, you know, uninspiring end market growth in the industrial vertical, but an opportunity to make that business better and grow profits. The offshore business continues to be robust, and the EFC business is growing very, very nicely. And so from an EBITDA growth perspective, we could repeat, you know, the mid-single-digit growth we delivered in 2025.

Got it. And then maybe on your acquisitions, the MicroMax EFC, how did they perform in 2025? Does your guide include them as still at 70 million EBITDA? And maybe also, I think in your prepared remarks, you mentioned some untapped commercial opportunities. Is that something we see in 26? Thank you. Yeah.

So, when we announced MicroMax, we said it was roughly 40 million of EBITDA in 25. And EFC, we said it was roughly 30 million, we expected roughly 30 million in 26, right? And so, you know, that's the roughly $70 million of contribution in 26 is adding those two with some modest growth and a little bit of conservatism as we navigate integrations. The Micromax business outgrew our expectations in 2025. Organic revenue growth was north of 10% for Micromax. So, you know, there were some questions about its ability to grow, and I think it disproved them in their early days in 2025. And we're seeing a really robust start to the year for that business here in 2026. Also for EFC, a month doesn't make a trend, but both of them are outperforming our initial expectations. The integrations are going really well. The folks at Micromax are incredibly excited to be a part of an electronics-oriented company. and we have just in the first days of integration identified several areas where collaboration and relationships, you know, discrete relationships their organization has and our organization has will yield what we believe will be better commercial outcomes for both businesses. So that's what we were referring to, to untapped commercial opportunities. We see our ability to make these businesses better as part of Element as quite compelling over and above the high-quality businesses they were independently.

Your next question comes from the line of Matthew Dayo with Bank of America. Please go ahead.

Morning, everyone. Morning, Matt. Ben, so I think you would share this with me, right? So the Taiwan Printed Circuit Board Association, right, calling for the PCB market to be up 14% in 2026. I mean, is it reasonable to assume this is like a base case for your associated volumes? Obviously, you can make maybe your own assumptions on the end markets, but like presumably you would also expect to outgrow this. And how do you factor in an outlook like that into how you perceive your own business performance?

So we use Prismark data as our baseline, and Prismark is talking about a 6% year in 2026, a 9% CAGR from 24 to 29. And so that's what we benchmark ourselves against. It's important to look at meters squared versus dollar value. So a lot of the PCBs that are being produced today, a lot of where the growth is coming from is really high-value, complex boards. Now, that's good for us because that's higher margin sales, but we're not driven by the dollar value of the circuit board. We're driven by the volume of circuit boards being produced. And so that might be the reconciling figure. There's, you know, there's a bull case in the circuit board market right now, given the acceleration of investment in data center capacity. And, you know, we were in Asia in early January, and the level of activity was unbelievable and super exciting. But as we look to 2026, we're looking at that 6% number. That's what we're building off of.

All right. I appreciate that. And I think in the call I heard 7% organic growth in energy solutions. So the comment seemed maybe to be a decent amount price-driven. Can you break down price volume in here, and should we kind of assume this price annualizes in 26? Is this – I know this is a pretty solid business for you. Is this kind of price in excess of raws, or is there some obscure raw material that I don't know of that's up, you know, materially? I'm just trying to chart the course for next year.

Yeah, the offshore business is a wonderful business. And I would say of the 7%, it's about half and half price volume growth. And this is one of those businesses where there is a bit more of a pricing lever available to us, and it's one where we're building that muscle as appropriate. So, you know, entering 2026, we were a little cautious, I would say, about volumes there. Energy price had been a little low. We saw some projects potentially shifting out to the right. But, you know, it should be a mid-single-digit grower between price and volume next year again. All right.

Your next question comes from the line of John Roberts with Mijuho. Please go ahead.

Thank you, and nice results. Is Couprion used in co-package optics, where they're using glass as a substrate?

So today, Couprion isn't used in high-volume manufacturing anywhere. It has applications in through-glass vias, which are the core layers for some of the highest-end printed circuit boards, and it solves a major customer pain point there. That's just one of many potential markets for it.

And how do we think about wafer-level packaging? Like, what are your key products that would be used in that application?

So we have wafer plating products that go onto the backside of wafers for packaging applications. We have advanced interconnect products that are used for copper pillars and barrier layers. We have printed circuit board chemistries for the highest-end printed circuit boards that are used in packages. So wafer-level packaging, advanced packaging, that is right at the sort of center of the Venn diagram of our capabilities and our solution sets for foundries and OSATs and the associated supply chain.

Is there a way to scope the size of that opportunity?

So we have a specific business we call wafer-level packaging, which is about $150 million of revenue. It's actually, you know, bumping up against $200 now that we've seen some precious metal price increases, and there are some precious metals in there that are not reported as pass-through. And then we've got, you know, ancillary products that go into advanced packaging applications, you know, which would, you know, bring our advanced packaging revenue, you know, to the multiple hundreds of millions. But, again, these are generic terms, and so, you know, it's hard to be too precise. Thank you.

Your next question comes from the line of Duffy Fisher with Goldman Sachs. Please go ahead.

Yeah, good morning. Just wanted to follow up. I think Carrie in the prepared remarks talked about a large customer contract. And I wasn't clear, it seemed like there was some distortion from that either currently or in the future, but could you just walk through what that is, the size, and kind of how that impacts the P&L?

Yeah, so in Q3 of 2024, we sold a large equipment line to a customer that was building manufacturing capacity in the industrial business in Mexico. And so that was large revenue with lower margin on the equipment, And we didn't make the equipment, by the way. We purchased it on their behalf in exchange for a multi-year high margin contract. It was a big market share win for us and a short payback period. So when you look at the year over year in Q3 and on a full year basis, there was a revenue contribution at lower margin in 24, which was replaced by higher margin chemistry sales in 25. Okay, great.

And then can you remind us on Couprion, if the plant runs as you expect, how long will it take, do you think, to sell the first plant out? And then roughly what's the contribution from the first plant, you know, when it's at full operating rates?

There are a lot of assumptions embedded in that. And so, you know, we don't want to be too precise. What I would say is we have a pipeline today for volumes in excess of that plant. The ramp of that plant, we should be ramped, you know, to full production in the second half of this year. And it will come at pretty compelling incremental margins. And what we've guided to is, you know, multiple millions of dollars of revenue in 26 and, you know, a material contribution to EBITDA from this in 27. Great. Thank you, guys. Thank you.

Your next question comes to the line of Pete Osterlin with Truist Securities. Please go ahead.

Hey, good morning, guys. Thanks for taking the questions. And I just wanted to follow up on some of your comments around specialties. What are your expectations around segment margins in 2026, excluding the impact of the EFC acquisition? I guess it's stable to slightly higher, a reasonable expectation given what sounds like continued growth in offshore. Are there any other major puts and takes to call out for margin performance in that business this year?

No, I think that we would expect that business to be expanding margins if we're going to deliver mid-single-digit growth, given the end market outlook for the segment overall ex-EFC.

Okay. And then just given some of the dynamics you've called out with working capital and the higher capex you're guiding for 2026, what are you targeting for free cash flow generation in 2026? Do you have a target in terms of EBITDA conversion you can share?

Yeah, I think consistent with prior years, we target roughly a 50% conversion of EBITDA to free cash flow. You know, to your point, the dynamics around metal pricing puts some seasonality questions in that. But ultimately, on a full-year basis, I would expect by around 50%, maybe just a tick lower. Thanks a lot.

And your final question comes from the line of Frank Mitch with Ferium Research. Please go ahead.

Thank you so much. Obviously, very busy start to the year with the acquisitions, and you offered some very constructive comments on how they're trending so far. I was wondering if you could expand upon your thoughts on top-line synergies for both as we progress through this year and into next year. How should we think about, you know, the longer-term implications for the top-line synergies between, you know, Micromax, EFC, and Elemental?

Yeah. Thanks for the question, Frank. You know, it's really hard to underwrite to revenue synergies because they're sort of hard to prove out. And we're in businesses that have long sales cycles, especially when you think about EFC and Micromax. It's highly qualified products. And so, you know, it's hard to say in 2026 we're going to see material revenue synergies. But what we've said repeatedly is that these are, these businesses are better inside of Element than outside. And so, in both cases, there's not a huge amount of cost synergy we're driving from It's, you know, being a part of a larger electronics organization and the resources and relationships that we can bring to bear to support those businesses. And we're already starting to see that, and the collaboration and joint customer visits, you know, is just beginning. And so, we believe that the MicroMax business will grow faster than it would have independently. EFC doesn't need any help growing faster, but, you know, we do believe that the relationships we have, and frankly, some of the relationships they have will help accelerate growth in both businesses. And so, you know, we do expect to see an acceleration overall from what you might call revenue synergies, but it's hard to quantify that and put time bounds on it.

Okay, gotcha. So at this point, the trend is positive, joint customer visits, et cetera, but you're too early to try and throw some numbers to it. And then just lastly, I mean, I believe you said before that the capital intensity of Micromax was similar to Element Solutions. I assume that that's similar for EFC as well.

I wish – just going back to that question, I wish I could say that one or two months into 2026, post-closing, you know, we're responsible for the strength in the businesses we're seeing. But, you know, that's just the quality of the businesses and the end market they're participating in. With regard to capital intensity, MicroMax is similar to ESI overall. EFC is modestly more capital intensive, but it's a smaller business. And, again, you know, we're guiding to $75 million in CapEx this year. We should comfortably cover it.

Yeah, I would just add that the returns on capital in that business, BFC in particular, are as high, if not higher, just given the profitability. Terrific. Thanks so much. Thanks, Frank.

I will now turn the call back over to Ben Glicklish for closing remarks.

Well, thank you, Rebecca, and thank you, everybody, for joining. Have a great day.

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.