Minerals Technologies Inc 10-Q for FY2026 Q3
Minerals Technologies Inc (MTX)
10-Q
2026-10-30
For: 2026-10-04
View Original
Added on
October 30, 2026
About this 10-Q
Minerals Technologies Inc filed this 10-Q on October 30, 2026, covering the quarter ended October 4, 2026 (FY2026 Q3).
Minerals Technologies Inc reported third-quarter 2026 sales of $554.9 million, up 4%, and net income of $42.7 million. It completed a $400,000,000 offering of 7.500% Senior Notes due 2032 and filed a plan providing $450 million for talc claims. AI summary
Headline figures
Quarter ended October 4, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $554.9M
- up 4.2% from $532.4M a year earlier
- Net income
- $42.7M
- down 0.7% from net income of $43M a year earlier
- Diluted EPS
- $1.37
- unchanged from $1.37 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended October 4, 2026
or
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 1-11430
(Exact name of registrant as specified in its charter)
| | | |
| (State or other jurisdiction of incorporation or organization) | | (I.R.S. Employer Identification No.) |
(Address of principal executive offices, including zip code)
(212 ) 878-1800
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol | Name of exchange on which registered |
| | | |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.
| | | No ☐ |
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
| | | No ☐ |
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| | Accelerated Filer ☐ |
| Non-accelerated Filer ☐ | Smaller Reporting Company |
| Emerging Growth Company | |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
| Yes ☐ | | No |
As of October 23, 2026, there were 31,068,249 shares of common stock, par value of $0.10 per share, of the registrant outstanding.
1
MINERALS TECHNOLOGIES INC.
INDEX TO FORM 10-Q
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PART I. FINANCIAL INFORMATION
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Item 1.
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Financial Statements:
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Item 2.
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Item 3.
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Item 4.
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37 | |
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PART II. OTHER INFORMATION
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Item 1.
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37 | |
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Item 1A.
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Item 2.
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37 | |
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Item 3.
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Item 4.
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37 | |
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Item 5.
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Item 6.
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2
PART 1. FINANCIAL INFORMATION
ITEM 1. Financial Statements
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
(Unaudited)
| Three Months Ended | Nine Months Ended | ||||||||||||||
| Oct. 4, | Sep. 28, | Oct. 4, | Sep. 28, | ||||||||||||
| (in millions of dollars, except per share data) | 2026 | 2025 | 2026 | 2025 | |||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||
| Cost of goods sold | |||||||||||||||
| Production margin | |||||||||||||||
| Marketing and administrative expenses | |||||||||||||||
| Research and development expenses | |||||||||||||||
| Provision for litigation accrual and credit losses | |||||||||||||||
| Restructuring and other items | |||||||||||||||
| Gain on sale of assets, net | ( | ) | |||||||||||||
| Litigation expenses | |||||||||||||||
| Income (loss) from operations | ( | ) | ( | ) | |||||||||||
| Interest expense, net | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
| Other non-operating income (deductions), net | ( | ) | ( | ) | |||||||||||
| Total non-operating deductions, net | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
| Income (loss) before tax and equity in earnings | ( | ) | ( | ) | |||||||||||
| Provision (benefit) for taxes on income | ( | ) | ( | ) | |||||||||||
| Equity in earnings of affiliates, net of tax | |||||||||||||||
| Net income (loss) | ( | ) | ( | ) | |||||||||||
| Less: | |||||||||||||||
| Net income attributable to non-controlling interests | |||||||||||||||
| Net income (loss) attributable to Minerals Technologies Inc. | $ | $ | $ | ( | ) | $ | ( | ) | |||||||
| Earnings (loss) per share: | |||||||||||||||
| Basic: | |||||||||||||||
| Net income (loss) attributable to Minerals Technologies Inc. | $ | $ | $ | ( | ) | $ | ( | ) | |||||||
| Diluted: | |||||||||||||||
| Net income (loss) attributable to Minerals Technologies Inc. | $ | $ | $ | ( | ) | $ | ( | ) | |||||||
| Cash dividends declared per common share | $ | $ | $ | $ | |||||||||||
| Shares used in computation of earnings (loss) per share: | |||||||||||||||
| Basic | |||||||||||||||
| Diluted | |||||||||||||||
See accompanying Notes to Condensed Consolidated Financial Statements.
3
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
(Unaudited)
| Three Months Ended | Nine Months Ended | ||||||||||||||
| Oct. 4, | Sep. 28, | Oct. 4, | Sep. 28, | ||||||||||||
| (in millions of dollars) | 2026 | 2025 | 2026 | 2025 | |||||||||||
| Net income (loss) | $ | $ | $ | ( | ) | $ | ( | ) | |||||||
| Other comprehensive income (loss), net of tax: | |||||||||||||||
| Foreign currency translation adjustments | ( | ) | ( | ) | ( | ) | |||||||||
| Pension and postretirement plan adjustments | |||||||||||||||
| Unrealized gain (loss) on derivative instruments | ( | ) | ( | ) | |||||||||||
| Total other comprehensive income (loss), net of tax | ( | ) | ( | ) | ( | ) | |||||||||
| Total comprehensive income (loss) including non-controlling interests | ( | ) | ( | ) | |||||||||||
| Comprehensive income attributable to non-controlling interests | |||||||||||||||
| Comprehensive income (loss) attributable to Minerals Technologies Inc. | $ | $ | $ | ( | ) | $ | ( | ) | |||||||
See accompanying Notes to Condensed Consolidated Financial Statements.
4
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
| Oct. 4, | Dec. 31, | ||||||
| (in millions of dollars) | 2026* | 2025** | |||||
| ASSETS | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | $ | |||||
| Short-term investments | |||||||
| Accounts receivable, net | |||||||
| Inventories | |||||||
| Prepaid expenses and other current assets | |||||||
| Total current assets | |||||||
| Property, plant, and equipment | |||||||
| Less accumulated depreciation and depletion | ( | ) | ( | ) | |||
| Property, plant, and equipment, net | |||||||
| Goodwill | |||||||
| Intangible assets | |||||||
| Deferred income taxes | |||||||
| Other assets and deferred charges | |||||||
| Total assets | $ | $ | |||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||
| Current liabilities: | |||||||
| Short-term debt | $ | $ | |||||
| Current maturities of long-term debt | |||||||
| Accounts payable | |||||||
| Other current liabilities | |||||||
| Total current liabilities | |||||||
| Long-term debt, net of unamortized discount and deferred financing costs | |||||||
| Deferred income taxes | |||||||
| Accrued pension and postretirement benefits | |||||||
| Other non-current liabilities | |||||||
| Total liabilities | |||||||
| Commitments and contingencies | |||||||
| Shareholders’ equity: | |||||||
| Common stock | |||||||
| Additional paid-in capital | |||||||
| Retained earnings | |||||||
| Accumulated other comprehensive loss | ( | ) | ( | ) | |||
| Less common stock held in treasury | ( | ) | ( | ) | |||
| Total Minerals Technologies Inc. shareholders’ equity | |||||||
| Non-controlling interests | |||||||
| Total shareholders’ equity | |||||||
| Total liabilities and shareholders’ equity | $ | $ |
* Unaudited
** Condensed from audited financial statements
See accompanying Notes to Condensed Consolidated Financial Statements.
5
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
(Unaudited)
| Nine Months Ended | |||||||
| Oct. 4, | Sep. 28, | ||||||
| (in millions of dollars) | 2026 | 2025 | |||||
| Operating Activities: | |||||||
| Net loss | $ | ( | ) | $ | ( | ) | |
| Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||
| Depreciation, depletion, and amortization | |||||||
| Reduction of right of use asset | |||||||
| Provision for litigation accrual and credit losses | |||||||
| Restructuring and other items | |||||||
| Pension funding | ( | ) | ( | ||||
| Other non-cash items, net | ( | ) | ( | ) | |||
| Net changes in operating assets and liabilities | ( | ) | ( | ) | |||
| Net cash provided by operating activities | |||||||
| Investing Activities: | |||||||
| Purchases of property, plant, and equipment | ( | ) | ( | ) | |||
| Proceeds from sale of short-term investments | |||||||
| Purchases of short-term investments | ( | ) | ( | ) | |||
| Other investing activities | ( | ) | ( | ) | |||
| Net cash used in investing activities | ( | ) | ( | ) | |||
| Financing Activities: | |||||||
| Net proceeds from (repayments of) short-term debt | ( | ) | |||||
| Repayment of long-term debt | ( | ) | ( | ) | |||
| Purchase of common stock for treasury | ( | ) | ( | ) | |||
| Proceeds from issuance of stock under option plan | |||||||
| Excess tax benefits related to stock incentive programs | ( | ) | ( | ) | |||
| Dividends paid to non-controlling interests | ( | ) | ( | ) | |||
| Cash dividends paid | ( | ) | ( | ) | |||
| Net cash used in financing activities | ( | ) | ( | ) | |||
| Effect of exchange rate changes on cash and cash equivalents | ( | ) | |||||
| Net increase (decrease) in cash and cash equivalents | ( | ) | |||||
| Cash and cash equivalents at beginning of period | |||||||
| Cash and cash equivalents at end of period | $ | $ | |||||
| Supplemental disclosure of cash flow information: | |||||||
| Interest paid | $ | $ | |||||
| Income taxes paid | $ | $ | |||||
| Non-cash financing activities: | |||||||
| Treasury stock purchases settled after period end | $ | $ | |||||
| Excise tax charged to equity not paid | $ | $ | |||||
See accompanying Notes to Condensed Consolidated Financial Statements.
6
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
(Unaudited)
| Equity Attributable to MTI | |||||||||||||||||||||||||||
| Accumulated | |||||||||||||||||||||||||||
| Additional | Other | ||||||||||||||||||||||||||
| Common | Paid-in | Retained | Comprehensive | Treasury | Non-controlling | ||||||||||||||||||||||
| (in millions of dollars) | Stock | Capital | Earnings | Loss | Stock | Interests | Total | ||||||||||||||||||||
| Balance as of December 31, 2025 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||
| Net income | |||||||||||||||||||||||||||
| Other comprehensive loss, net | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||
| Dividends declared | ( | ) | ( | ) | |||||||||||||||||||||||
| Dividends paid to non-controlling interests | ( | ( | |||||||||||||||||||||||||
| Issuance of shares pursuant to employee stock compensation plans | |||||||||||||||||||||||||||
| Purchase of common stock for treasury | ( | ) | ( | ) | |||||||||||||||||||||||
| Stock-based compensation | |||||||||||||||||||||||||||
| Conversion of RSU's for tax withholding | ( | ) | ( | ) | |||||||||||||||||||||||
| Balance as of April 5, 2026 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||
| Net income (loss) | ( | ) | ( | ) | |||||||||||||||||||||||
| Other comprehensive loss, net | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||
| Dividends declared | ( | ) | ( | ) | |||||||||||||||||||||||
| Dividends paid to non-controlling interests | ( | ) | ( | ) | |||||||||||||||||||||||
| Issuance of shares pursuant to employee stock compensation plans | |||||||||||||||||||||||||||
| Purchase of common stock for treasury | ( | ) | ( | ) | |||||||||||||||||||||||
| Stock-based compensation | |||||||||||||||||||||||||||
| Balance as of July 5, 2026 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||
| Net income | |||||||||||||||||||||||||||
| Other comprehensive income (loss), net | ( | ) | ( | ) | |||||||||||||||||||||||
| Dividends declared | ( | ) | ( | ) | |||||||||||||||||||||||
| Dividends paid to non-controlling interests | ( | ) | ( | ) | |||||||||||||||||||||||
| Issuance of shares pursuant to employee stock compensation plans | |||||||||||||||||||||||||||
| Purchase of common stock for treasury | ( | ) | ( | ) | |||||||||||||||||||||||
| Stock-based compensation | |||||||||||||||||||||||||||
| Balance as of October 4, 2026 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||
See accompanying Notes to Condensed Consolidated Financial Statements.
7
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(Unaudited)
| Equity Attributable to MTI | |||||||||||||||||||||||||||
| Accumulated | |||||||||||||||||||||||||||
| Additional | Other | ||||||||||||||||||||||||||
| Common | Paid-in | Retained | Comprehensive | Treasury | Non-controlling | ||||||||||||||||||||||
| (in millions of dollars) | Stock | Capital | Earnings | Loss | Stock | Interests | Total | ||||||||||||||||||||
| Balance as of December 31, 2024 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||
| Net income (loss) | ( | ) | ( | ) | |||||||||||||||||||||||
| Other comprehensive income (loss), net | ( | ) | |||||||||||||||||||||||||
| Dividends declared | ( | ) | ( | ) | |||||||||||||||||||||||
| Issuance of shares pursuant to employee stock compensation plans | |||||||||||||||||||||||||||
| Purchase of common stock for treasury | ( | ) | ( | ) | |||||||||||||||||||||||
| Stock-based compensation | |||||||||||||||||||||||||||
| Conversion of RSU's for tax withholding | ( | ) | ( | ) | |||||||||||||||||||||||
| Balance as of March 30, 2025 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||
| Net income | |||||||||||||||||||||||||||
| Other comprehensive income, net | |||||||||||||||||||||||||||
| Dividends declared | ( | ) | ( | ) | |||||||||||||||||||||||
| Dividends paid to non-controlling interests | ( | ) | ( | ) | |||||||||||||||||||||||
| Purchase of common stock for treasury | ( | ) | ( | ) | |||||||||||||||||||||||
| Stock-based compensation | |||||||||||||||||||||||||||
| Balance as of June 29, 2025 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||
| Net income | |||||||||||||||||||||||||||
| Other comprehensive loss, net | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||
| Dividends declared | ( | ) | ( | ) | |||||||||||||||||||||||
| Dividends paid to non-controlling interests | ( | ) | ( | ) | |||||||||||||||||||||||
| Issuance of shares pursuant to employee stock compensation plans | |||||||||||||||||||||||||||
| Purchase of common stock for treasury | ( | ) | ( | ) | |||||||||||||||||||||||
| Stock-based compensation | |||||||||||||||||||||||||||
| Balance as of September 28, 2025 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||
See accompanying Notes to Condensed Consolidated Financial Statements.
8
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
(Unaudited)
Note 1. Basis of Presentation and Summary of Significant Accounting Policies
The accompanying unaudited Condensed Consolidated Financial Statements have been prepared by management of Minerals Technologies Inc. (together with its subsidiaries, the “Company,” “MTI,” “we,” “us,” or “our”) in accordance with the rules and regulations of the United States Securities and Exchange Commission. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted. Therefore, these financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. In the opinion of management, all adjustments, consisting solely of normal recurring adjustments necessary for a fair presentation of the financial information for the periods indicated, have been included. The results for the three and nine-month periods ended October 4, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026.
Company Operations
The Company is a global, technology-driven specialty minerals company that develops, produces, and markets a wide range of minerals and mineral-based products and services. We utilize global mineral reserves with our core technologies and applications to deliver innovative solutions for products that are part of everyday life. We serve customers in consumer and industrial markets worldwide.
The Company has two reportable segments: Consumer & Specialties and Engineered Solutions.
- The Consumer & Specialties segment serves consumer end markets directly with mineral-to-market finished products and also provides specialty mineral-based solutions and technologies that are an essential component of our customers' finished products.
- The Engineered Solutions segment serves industrial end markets with engineered systems, mineral blends, and technologies that are designed to improve our customers' manufacturing processes and projects.
Use of Estimates
The Company employs accounting policies that are in accordance with U.S. generally accepted accounting principles and require management to make estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the Condensed Consolidated Financial Statements and the reported amounts of revenue and expenses during the reported period. Significant estimates include those related to revenue recognition, valuation of long-lived assets, goodwill and other intangible assets, certain pension plan assumptions, valuation of
deferred income tax assets, provision for credit losses, and legal and
environmental liabilities. Actual results could differ from those estimates.
Reclassifications
Certain reclassifications have been made to the prior period financial information to conform to the presentation used in the Condensed Consolidated Financial Statements for the three and nine-month periods ended October 4, 2026.
Recently Issued Accounting Standards
Changes to accounting principles generally accepted in the United States of America (U.S. GAAP) are established by the Financial Accounting Standards Board (FASB) in the form of accounting standards updates (ASUs) to the FASB’s Accounting Standards Codification. The Company considers the applicability and impact of all ASUs. ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on our consolidated financial position and results of operations.
9
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses
In November 2024, the FASB issued ASU 2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses” that requires entities to disclose additional information in the notes to the financial statements about prescribed categories underlying any relevant income statement expense caption. The new standard is effective for annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. The adoption of this standard is not expected to have a material impact on the Company’s Consolidated Financial Statements but will result in disaggregation of the Company’s income statement expenses.
Note 2. Revenue from Contracts with Customers
The following table disaggregates our revenue by major source (product line) for the three and nine-month periods ended October 4, 2026 and September 28, 2025:
| (in millions of dollars) | Three Months Ended | Nine Months Ended | |||||||||||||
| Oct. 4, | Sep. 28, | Oct. 4, | Sep. 28, | ||||||||||||
| Net Sales | 2026 | 2025 | 2026 | 2025 | |||||||||||
| Household & Personal Care | $ | $ | $ | $ | |||||||||||
| Specialty Additives | |||||||||||||||
| Consumer & Specialties Segment | |||||||||||||||
| High-Temperature Technologies | |||||||||||||||
| Environmental & Infrastructure | |||||||||||||||
| Engineered Solutions Segment | |||||||||||||||
| Total net sales | $ | $ | $ | $ | |||||||||||
Note 3. Earnings (loss) per Share (EPS)
Basic earnings (loss) per share are based upon the weighted average number of common shares outstanding during the period. Diluted earnings (loss) per share are based upon the weighted average number of common shares outstanding during the period, assuming the issuance of common shares for all potentially dilutive common shares outstanding.
The following table sets forth the computation of basic and diluted earnings (loss) per share:
| Three Months Ended | Nine Months Ended | ||||||||||||||
| Oct. 4, | Sep. 28, | Oct. 4, | Sep. 28, | ||||||||||||
| (in millions of dollars, except per share data) | 2026 | 2025 | 2026 | 2025 | |||||||||||
| Net income (loss) attributable to Minerals Technologies Inc. | $ | $ | $ | ( | ) | $ | ( | ) | |||||||
| Weighted average shares outstanding | |||||||||||||||
| Dilutive effect of stock options and deferred restricted stock units | |||||||||||||||
| Weighted average shares outstanding, adjusted | |||||||||||||||
| Basic earnings (loss) per share attributable to Minerals Technologies Inc. | $ | $ | $ | ( | ) | $ | ( | ) | |||||||
| Diluted earnings (loss) per share attributable to Minerals Technologies Inc. | $ | $ | $ | ( | ) | $ | ( | ) | |||||||
10
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Of the options outstanding of 1,525,140 1,582,083 853,461 1,209,857
Note 4. Restructuring and Other Items
In the second quarter of 2025, the Company recorded a $5.8 million charge in restructuring and other items for the write-down of assets and other charges relating to the consolidation of two facilities.
In the first quarter of 2025, the Company initiated a cost savings program, primarily through workforce reductions, and recorded a charge of $5.5 million for severance and other related costs associated with this program.
The following table outlines the amount of restructuring charges recorded within the Condensed Consolidated Statements of Income (Loss) and the segment they relate to:
| Three Months Ended | Nine Months Ended | ||||||||||||||
| Oct. 4, | Sep. 28, | Oct. 4, | Sep. 28, | ||||||||||||
| (in millions of dollars) | 2026 | 2025 | 2026 | 2025 | |||||||||||
| Write-down of assets | |||||||||||||||
| Consumer & Specialties | $ | $ | $ | $ | |||||||||||
| Engineered Solutions | |||||||||||||||
| Total charge for asset write-downs | $ | $ | $ | $ | |||||||||||
| Severance and other related costs | |||||||||||||||
| Consumer & Specialties | $ | $ | $ | $ | |||||||||||
| Engineered Solutions | |||||||||||||||
| Corporate | |||||||||||||||
| Total severance and other related costs | $ | $ | $ | $ | |||||||||||
| Total restructuring and other items | $ | $ | $ | $ | |||||||||||
At October 4, 2026, the Company had $3.3 million included within other current liabilities in the Condensed Consolidated Balance Sheet for cash expenditures needed to satisfy remaining obligations under workforce reduction initiatives. The Company expects to pay these amounts within the next twelve months.
The following table is a reconciliation of our restructuring liability balance relating to workforce reductions as of October 4, 2026:
| (in millions of dollars) | |||
| Restructuring liability, December 31, 2025 | $ | ||
| Cash payments | ( | ) | |
| Restructuring liability, October 4, 2026 | $ |
11
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 5. Income Taxes
Provision for taxes was $12.2 million and $13.5 million for the three-month periods ended October 4, 2026 and September 28, 2025, respectively. Benefit for taxes was $24.1 million and $4.7 million for the nine-month periods ended October 4, 2026 and September 28, 2025, respectively, primarily attributable to the litigation accrual. The effective tax rate was 23.0 % for the three-month period ended October 4, 2026, as compared with 23.9 % for the three-month period ended September 28, 2025.
As of October 4, 2026, the Company had approximately $6.2 million of total unrecognized income tax benefits. Included in this amount were a total of $4.6 million of unrecognized income tax benefits that, if recognized, would affect the Company’s effective tax rate. While it is expected that the amount of unrecognized tax benefits will change in the next 12 months, the Company does not expect the change to have a significant impact on the results of operations or the financial position of the Company.
The Company’s accounting policy is to recognize interest and penalties accrued, relating to unrecognized income tax or benefit as part of its provision for income taxes. The Company recorded net immaterial additions during the three-month period ended October 4, 2026 and had an accrued balance of $0.8 million of interest and penalties as of October 4, 2026.
The Company operates in multiple taxing jurisdictions, both within and outside the U.S. In certain situations, a taxing authority may challenge positions that the Company has adopted in its income tax filings. The Company, with a few exceptions (none of which are material), is no longer subject to U.S. federal, state, local, and international income tax examinations by tax authorities for years prior to 2017.
On July 4, 2025, the One Big Beautiful Bill Act was signed into law in the U.S. It contains a broad range of tax reform provisions affecting businesses. The Company evaluated the full effects of the legislation on our annual effective tax rate and cash tax position, and it did not have a material impact on our Consolidated Financial Statements.
In December 2021, the Organization for Economic Co-operation and Development (“OECD”) released the Pillar Two Model Rules which aim to reform international corporate taxation rules, including the implementation of a global minimum tax rate. The Company began implementation of the Pillar Two Model Rules in the first quarter of 2024. The Company continues to assess the effect of the Pillar Two Model Rules in all jurisdictions and does not expect that Pillar Two will have a material impact on its Consolidated Financial Statements.
Note 6. Inventories
The following is a summary of inventories by major category:
| Oct. 4, | Dec. 31, | ||||||
| (in millions of dollars) | 2026 | 2025 | |||||
| Raw materials | $ | $ | |||||
| Work-in-process | |||||||
| Finished goods | |||||||
| Packaging and supplies | |||||||
| Total inventories | $ | $ |
12
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 7. Goodwill and Other Intangible Assets
Goodwill and other intangible assets with indefinite lives are not amortized, but instead are assessed for impairment, at least annually. The carrying amount of goodwill was $915.5 million and $915.9 million as of October 4, 2026 and December 31, 2025, respectively. The net change in goodwill from December 31, 2025 to October 4, 2026 is attributable to the effects of foreign exchange.
Acquired intangible assets subject to amortization as of October 4, 2026 and December 31, 2025 were as follows:
| Oct. 4, 2026 | Dec. 31, 2025 | ||||||||||||||||||
| Weighted Average | Gross | Gross | |||||||||||||||||
| Useful Life | Carrying | Accumulated | Carrying | Accumulated | |||||||||||||||
| (in millions of dollars) | (Years) | Amount | Amortization | Amount | Amortization | ||||||||||||||
| Tradenames | $ | $ | $ | $ | |||||||||||||||
| Technology | |||||||||||||||||||
| Patents and trademarks | |||||||||||||||||||
| Customer relationships | |||||||||||||||||||
| $ | $ | $ | $ | ||||||||||||||||
The weighted average amortization period for acquired intangible assets subject to amortization is approximately 29 years. Estimated amortization expense is $2.9 million for the remainder of 2026, $46.0 million for 2027–2030 and $150.5 million thereafter.
Note 8. Derivative Financial Instruments
As a multinational corporation with operations throughout the world, the Company is exposed to certain market risks. The Company uses a variety of practices to manage these market risks, including, when considered appropriate, derivative financial instruments. The Company’s objective is to offset gains and losses resulting from interest rate and foreign currency exposures with gains and losses on the derivative contracts used to hedge them. The Company uses derivative financial instruments only for risk management and not for trading or speculative purposes.
By using derivative financial instruments to hedge exposures to changes in interest rates and foreign currencies, the Company exposes itself to credit risk and market risk. Credit risk is the risk that the counterparty will fail to perform under the terms of the derivative contract. When the fair value of a derivative contract is positive, the counterparty owes the Company, which creates credit risk for the Company. When the fair value of a derivative contract is negative, the Company owes the counterparty, and therefore, it does not face any credit risk. The Company minimizes the credit risk in derivative instruments by entering into transactions with major financial institutions.
Market risk is the adverse effect on the value of a financial instrument that results from a change in interest rates, currency exchange rates, or commodity prices. The market risk associated with interest rate and forward exchange contracts is managed by establishing and monitoring parameters that limit the types and degree of market risk that may be undertaken.
Cash Flow Hedges
For derivative instruments that are designated and qualify as cash flow hedges, the Company records the effective portion of the gain or loss in accumulated other comprehensive income (loss) as a separate component of shareholders’ equity. The Company subsequently reclassifies the effective portion of gain or loss into earnings in the period during which the hedged transaction is recognized in earnings.
The Company utilizes interest rate swaps to limit exposure to market fluctuations on floating-rate debt. In the second quarter of 2023, the Company entered into a floating to fixed interest rate swap for a notional amount of $150 million. This interest rate swap matured in May 2026. In the second quarter of 2026, the Company entered into a new floating to fixed interest rate swap for a notional amount of $150 million. The fair value of this swap is an asset of $3.8 million at October 4, 2026 and is recorded in other assets and deferred charges on the Condensed Consolidated Balance Sheet. This interest rate swap is designated as a cash flow hedge. As a result, the gains and losses associated with this interest rate swap are recorded in accumulated other comprehensive income (loss).
13
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Assets and liabilities measured at fair value are based on one or more of three valuation techniques. The three valuation techniques are as follows:
- Market approach - prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.
- Cost approach - amount that would be required to replace the service capacity of an asset or replacement cost.
- Income approach - techniques to convert future amounts to a single present amount based on market expectations, including present value techniques, option-pricing and other models.
The Company primarily applies the income approach for interest rate derivatives for recurring fair value measurements and attempts to utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs.
The fair value of our interest rate swap contract is determined based on inputs that are readily available in public markets or can be derived from information available in publicly quoted markets and is categorized as Level 2.
Note 9. Long-Term Debt and Commitments
The following is a summary of long-term debt:
| Oct. 4, | Dec. 31, | ||||||
| (in millions of dollars) | 2026 | 2025 | |||||
| Secured Credit Agreement: | |||||||
| Term Loan due , net of unamortized deferred financing cost and original issue discount of $ | $ | $ | |||||
| Senior Notes: | |||||||
| Other debt | |||||||
| Total | $ | $ | |||||
| Less: Current maturities of long-term debt | |||||||
| Total long-term debt | $ | $ |
On November 26, 2024, the Company entered into a Refinancing Facility Agreement and Incremental Facility Amendment (the “Amendment”) to amend the Company’s previous credit agreement (the “Previous Credit Agreement; the previous credit agreement, as amended by the Amendment, being the “Amended Credit Agreement”).
The Amendment provides for, among other things, a new senior secured revolving credit facility with aggregate commitments of $400 million (the “Revolving Facility”), a portion of which may be used for the issuance of letters of credit and swingline loans, and a new senior secured term loan facility with aggregate commitments of $575 million (the “Term Loan Facility” and, together with the Revolving Facility, the “Senior Secured Credit Facilities”). The Revolving Facility and the Term Loan Facility replace the facilities under the Previous Credit Agreement, which provided for, among other things, a $550 million senior secured term loan facility and a $300 million senior secured revolving credit facility. The maturity date for loans and commitments under the Revolving Facility is November 26, 2029 , and the maturity date for loans under the Term Loan Facility is November 26, 2031 ; provided that the maturity dates of the Revolving Facility and the Term Loan Facility will be adjusted to the date that is 91 days prior to the stated maturity date of the Company’s 5.0 % Senior Notes due 2028 (the “Notes”) unless, prior to the date that is 91 days prior to the stated maturity date of the Notes, all amounts in excess of $50 million of the Notes have been either (a) refinanced with indebtedness permitted under the Amended Credit Agreement maturing later than 90 days after the scheduled maturity date of the Revolving Facility or of the Term Loan Facility, as applicable, or (b) repaid, discharged or repaid (other than with the proceeds of any indebtedness maturing earlier than 91 days after the scheduled maturity date of the Revolving Facility or of the Term Loan Facility, as applicable). Loans under the Term Loan Facility amortize at a rate equal to 1.00 % per annum, payable in equal quarterly installments, and were issued with original issue discount at 99.875 % of par.
14
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Loans under the Revolving Facility will bear interest at a rate equal to (a) for loans denominated in U.S. dollars, at the election of the Company, Term SOFR plus an applicable margin equal to 1.375 % per annum or a base rate plus an applicable margin equal to 0.375 % per annum, (b) for loans denominated in Euros, adjusted EURIBOR plus an applicable margin equal to 1.375 % per annum and (c) for loans denominated in Pounds Sterling, SONIA plus an applicable margin equal to 1.375 % per annum, subject in each case to (i) an increase of 37.5 basis points in the event that, and for so long as, the Net Leverage Ratio (as defined in the Amended Credit Agreement) is greater than or equal to 3.00 to 1.00 as of the last day of the preceding fiscal quarter, (ii) an increase of 12.5 basis points in the event that, and for so long as, the Net Leverage Ratio is less than 3.00 to 1.00 and greater than or equal to 2.00 to 1.00 as of the last day of the preceding fiscal quarter, and (iii) a decrease of 12.5 basis points in the event that, and for so long as, the Net Leverage Ratio is less than 1.00 to 1.00 as of the last day of the preceding fiscal quarter. Loans under the Term Loan Facility will bear interest at a rate equal to, at the election of the Company, Term SOFR plus an applicable margin equal to 2.00 % per annum or a base rate plus an applicable margin equal to 1.00 % per annum. The Company will pay certain fees under the Amended Credit Agreement, including (a) a commitment fee of 0.175 % per annum on the undrawn portion of the Revolving Facility (subject to a step-ups to 0.300 % and 0.250 % and a step-down to 0.150 % at the same levels described above), (b) a fronting fee of 0.125 % per annum on the average daily undrawn amount of, plus unreimbursed amounts in respect of disbursements under, letters of credit issued under the Revolving Facility, and (c) customary annual administration fees. The obligations of the Company under the Senior Secured Credit Facilities are unconditionally guaranteed jointly and severally by, subject to certain exceptions, all material domestic subsidiaries of the Company (the “Guarantors”) and secured, subject to certain exceptions, by a security interest in substantially all of the tangible and intangible assets of the Company and the Guarantors.
On October 13, 2026, the Company entered into a
Refinancing Facility Agreement and Incremental Facility Amendment (the “2026
Amendment”) to amend the Amended Credit Agreement (the Amended Credit
Agreement, as amended by the 2026 Amendment, the “2026 Amended Credit
Agreement”). The 2026 Amendment provides for, among other things, a new senior
secured revolving credit facility with aggregate commitments of $500,000,000
(the “2026 Refinancing Revolving Facility”), a portion of which may be used for
the issuance of letters of credit and swingline loans. The 2026 Refinancing
Revolving Facility replaces the Revolving Facility. The maturity date for loans
and commitments under the 2026 Refinancing Revolving Facility is October 13,
2031 ; provided that the maturity date of the 2026 Refinancing Revolving
Facility will be adjusted to the date that is 91 days prior to the stated
maturity date of the Term Loan Facility unless, prior to the date that is 91
days prior to the stated maturity date of the Term Loan Facility, all amounts
in excess of $50,000,000 of the Term Loan Facility have been either (a)
refinanced with indebtedness permitted under the 2026 Amended Credit Agreement
maturing later than 90 days after the scheduled maturity date of the Term Loan
Facility or (b) discharged or repaid (other than with the proceeds of any
indebtedness maturing earlier than 91 days after the scheduled maturity date of
the 2026 Refinancing Revolving Facility). The 2026 Amendment does not change
any terms of the Term Loan Facility and, except as set forth above, the terms
of the 2026 Refinancing Revolving Facility (including interest rates and fees)
remain the same as the Revolving Facility.
As of October 4, 2026, there were no loans and $11.2 million in letters of credit outstanding under the Revolving Facility.
On June 30, 2020, the Company issued $400 million aggregate principal amount of "5 % Senior Notes" due 2028 (the "2028 Notes"). The 2028 Notes were issued pursuant to an indenture, dated as of June 30, 2020, between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee (the “2020 Indenture”). The 2028 Notes bore an interest rate of 5.0 % per annum payable semi-annually on January 1 and July 1 of each year, beginning on January 1, 2021. The 2028 Notes were unconditionally guaranteed on a senior unsecured basis by each of the Company’s existing and future wholly owned domestic restricted subsidiaries that is a borrower under or that guarantees the Company’s obligations under its Senior Secured Credit Facilities or that guarantees the Company’s or any of the Company’s wholly owned domestic subsidiaries’ long-term indebtedness in an aggregate amount in excess of $50 million.
On October 13, 2026, the Company completed an offering of $400,000,000 aggregate principal amount of its 7.500 % Senior Notes due 2032 (the “2032 Notes”). The Company used the net proceeds of its offering of the 2032 Notes, together with cash on hand, (i) to redeem all of the outstanding 2028 Notes and (ii) to pay transaction fees and expenses related to the offering of the 2032 Notes and the 2026 Amendment . The terms of the 2032 Notes are governed by an indenture dated as of October 13, 2026 (the “2026 Indenture”), among the Company, the subsidiary guarantors party thereto and U.S. Bank Trust Company, National Association, as trustee (the “2026 Trustee”).
The 2032 Notes bear interest at a rate of 7.500 % per annum payable semi-annually in arrears on January 15 and July 15 of each year, beginning on January 15, 2027. The 2032 Notes are guaranteed by the Company’s wholly owned domestic restricted subsidiaries that are obligors or guarantors under its senior secured credit facilities or certain other indebtedness.
15
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
At any time and from time to time prior to
January 15, 2029, the Company may redeem some or all of the 2032 Notes for cash
at a redemption price equal to 100 % of their principal amount, plus the
“make-whole” premium described in the 2026 Indenture and accrued and unpaid
interest, if any, to, but excluding, the applicable redemption date. Beginning
on January 15, 2029, the Company may redeem some or all of the 2032 Notes at any time
and from time to time at the applicable redemption prices listed in the
Indenture, plus accrued and unpaid interest, if any, to, but excluding, the
applicable redemption date. In
addition, at any time and from time to time prior to January 15, 2029, the
Company may redeem up to 40 % of the aggregate principal amount of the 2032 Notes
with funds from one or more equity offerings at a redemption price equal to
107.500 % of the principal amount thereof, plus accrued and unpaid interest, if
any, to, but excluding, the applicable redemption date.
If the Company experiences a change of control (as defined in the indenture), the Company is required to offer to repurchase the 2032 Notes at 101 % of the principal amount of such Notes, plus accrued and unpaid interest, if any, to, but excluding, the date of repurchase.
The Amended Credit Agreement, and the 2020 Indenture, as well as the 2026 Amended Credit Agreement and the 2026 Indenture, contain certain customary affirmative and negative covenants that limit or restrict the ability of the Company and its restricted subsidiaries to enter into certain transactions or take certain actions, as well as customary events of default. In addition, the Amended Credit Agreement and the 2026 Amended Credit Agreement contain a financial covenant that requires the Company to maintain a maximum Net Leverage Ratio of 4.00 to 1.00 for each four fiscal quarter period (subject to an increase to 5.00 to 1.00 for four quarters in connection with certain significant acquisitions). The Company was in compliance with all the covenants contained in the Amended Credit Agreement throughout the period covered by this report.
The Company had a committed loan facility in Japan. In the second quarter of 2026, the Company repaid the remaining balance of $0.4 million.
As part of the acquisition of Concept Pet Heimtierprodukte GmbH (“Concept Pet”) in 2022, the Company assumed $1.9 million in long-term debt, recorded at fair value, consisting of two term loans, one that matured in 2025 and one that matures in 2027. The outstanding loan has annual payments and carries a variable interest rate. The Company repaid $0.1 million on this loan during the first nine months of 2026.
As of October 4, 2026, the Company had $13.9 million in uncommitted short-term bank credit lines, of which none were in use.
Note 10. Benefit Plans
The Company and its subsidiaries have pension plans covering the majority of its eligible employees on a contributory or non-contributory basis. The Company also provides postretirement health care and life insurance benefits for the majority of its U.S. retired employees. Disclosures for the U.S. plans have been combined with those outside of the U.S., as the international plans do not have significantly different assumptions, and together represent less than 20 % of our total benefit obligation.
Components of Net Periodic Benefit Cost (Income)
| Pension Benefits | |||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||
| Oct. 4, | Sep. 28, | Oct. 4, | Sep. 28, | ||||||||||||
| (in millions of dollars) | 2026 | 2025 | 2026 | 2025 | |||||||||||
| Service cost | $ | $ | $ | $ | |||||||||||
| Interest cost | |||||||||||||||
| Expected return on plan assets | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
| Amortization: | |||||||||||||||
| Recognized net actuarial loss | |||||||||||||||
| Net periodic benefit cost (income) | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||
16
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
| Postretirement Benefits | |||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||
| Oct. 4, | Sep. 28, | Oct. 4, | Sep. 28, | ||||||||||||
| (in millions of dollars) | 2026 | 2025 | 2026 | 2025 | |||||||||||
| Service cost | $ | $ | $ | $ | |||||||||||
| Interest cost | |||||||||||||||
| Amortization: | |||||||||||||||
| Recognized net actuarial gain | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
| Net periodic benefit cost (income) | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||
Amortization amounts of prior service costs and recognized net actuarial losses are recorded, net of tax, as increases to accumulated other comprehensive income.
The Company expects to contribute approximately $10.8 million to its pension plans and $0.1 million to its other postretirement benefit plans in 2026. As of October 4, 2026, $4.8 million has been contributed to the pension plans and no contributions have been made to the other postretirement benefit plans.
Note 11. Comprehensive Income
The following table summarizes the amounts reclassified out of accumulated other comprehensive loss attributable to the Company:
| Three Months Ended | Nine Months Ended | ||||||||||||||
| Oct. 4, | Sep. 28, | Oct. 4, | Sep. 28, | ||||||||||||
| (in millions of dollars) | 2026 | 2025 | 2026 | 2025 | |||||||||||
| Amortization of pension items: | |||||||||||||||
| Pre-tax amount | $ | $ | $ | ( | ) | $ | |||||||||
| Tax | ( | ) | |||||||||||||
| Net of tax | $ | $ | $ | $ | |||||||||||
The pre-tax amounts in the table above are included within the components of net periodic pension benefit cost (see Note 10 to the Condensed Consolidated Financial Statements) and the tax amounts are included within the provision (benefit) for taxes on income line within the Condensed Consolidated Statements of Income (Loss).
The major components of accumulated other comprehensive loss, net of related tax, attributable to MTI are as follows:
| Foreign Currency | Net Gain (Loss) | ||||||||||||||
| Translation | Unrecognized | on Derivative | |||||||||||||
| (in millions of dollars) | Adjustment | Pension Costs | Instruments | Total | |||||||||||
| Balance as of December 31, 2025 | $ | ( | ) | $ | $ | $ | ( | ) | |||||||
| Other comprehensive income (loss) before reclassifications | ( | ) | ( | ) | |||||||||||
| Amounts reclassified from AOCI | |||||||||||||||
| Net current period other comprehensive income (loss) | ( | ) | ( | ) | |||||||||||
| Balance as of October 4, 2026 | $ | ( | ) | $ | $ | $ | ( | ) |
17
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 12. Contingencies
The Company is party to a number of lawsuits arising
in the normal course of our business. The Company and certain of the Company’s
subsidiaries are among numerous defendants in a number of cases seeking damages
for alleged exposure to asbestos-contaminated talc products sold by the
Company’s subsidiary BMI Oldco Inc (f/k/a Barretts Minerals Inc.)
("Oldco").
On October 2, 2023 (the “Petition Date”),
notwithstanding the Company’s confidence in the safety of Oldco’s talc
products, the Company’s subsidiaries, Oldco and Barretts Ventures Texas LLC
("BVT" and, together with Oldco, the “Chapter 11 Debtors”), filed
voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code in
the United States Bankruptcy Court for the Southern District of Texas (the
“Chapter 11 Cases”) to address and comprehensively resolve Oldco’s liabilities
associated with talc. Minerals Technologies Inc. and the Company’s other
subsidiaries were not included in the Chapter 11 filing.
The Chapter 11 Debtors’ stated goal in the
Chapter 11 Cases is to confirm a plan of reorganization under Section 524(g) of
the U.S. Bankruptcy Code and utilize this provision of the Bankruptcy Code to
establish a trust that will address all current and future talc-related claims.
As of October 4, 2026, we had 1,051 open cases related to certain talc products previously sold by Oldco, which is an increase in volume from previous years. The following table details case activity related to talc products previously sold by Oldco:
| Three Months Ended | Nine Months Ended | ||||||||||||||
| Oct. 4, | Sep. 28, | Oct. 4, | Sep. 28, | ||||||||||||
| (number of claims) | 2026 | 2025 | 2026 | 2025 | |||||||||||
| Claims pending, beginning of period | |||||||||||||||
| Claims filed | |||||||||||||||
| Less: Claims dismissed, settled, or otherwise resolved | |||||||||||||||
| Claims pending, end of period | |||||||||||||||
These claims typically allege various theories
of liability, including negligence, gross negligence, and strict liability and
seek compensatory and, in some cases, punitive damages, but most of these
claims do not provide adequate information to assess their merits, the
likelihood that the Company will be found liable, or the magnitude of such
liability, if any. We are unable to state an amount or range of amounts claimed
in any of these lawsuits because state court pleading practices do not require
the plaintiff to identify the amount of the claimed damage. The Company’s
position, as stated publicly, is that the talc products sold by Oldco are safe
and do not cause cancer.
During the pendency of the Chapter 11 Cases, the
Company anticipates that the Chapter 11 Debtors will benefit from the operation
of the automatic stay, which stays ongoing litigation in connection with
talc-related claims against the Chapter 11 Debtors. In addition, the Bankruptcy
Court temporarily enjoined the filing or continued prosecution of all
talc-related claims against the Chapter 11 Debtors’ non-debtor affiliates,
subject to certain exceptions. Such exceptions consist of claims premised
solely on alleged inadequacies in testing of talc sold by Oldco. The
Company is vigorously opposing and defending against these claims.
While costs relating to the talc-related cases
have increased concurrently with the volume, the majority of these costs have
historically been borne by Pfizer Inc. (“Pfizer”) in connection with certain
agreements entered into in connection with the Company’s initial public
offering in 1992, and as long as the litigation is subject to the stay under
the Chapter 11 Cases (subject to certain exceptions), the Company will not be
required to make substantial payments in respect thereof. The Company is entitled
to indemnification, pursuant to agreement, for liabilities arising from sales
prior to the initial public offering. On May 22, 2024, Pfizer filed a motion in
the Chapter 11 Cases seeking permission to file a lawsuit against the Company
related to the 1992 agreement. That motion has been adjourned, and Pfizer and
the Company have agreed to mediate their disputes. The Company continues to
receive information from Pfizer with respect to potential costs associated with
the defense and/or settlement of talc-related cases that Pfizer alleges are not
subject to indemnification. Although the Company believes that the talc
products are safe and that claims to the contrary are without merit, the
Company and Oldco have opportunistically settled certain talc-related cases not
settled by Pfizer. None of such settlements were material to the Company.
18
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
In the second quarter of 2024, Oldco sold its
talc assets under section 363 of the Bankruptcy Code. In addition, in the
second quarter of 2024, the Company entered into a Debtor-in-Possession Credit
Agreement with Oldco (the “DIP Credit Agreement”) and recorded a provision for
credit loss of $30 million for the maximum principal amount under such
Credit Agreement. The Company agreed to
amend the DIP Credit Agreement to increase the maximum principal amount under such
Credit Agreement by $30 million in the second quarter of 2025 and another $2.6 million in the second quarter of 2026. Proceeds of the sale of Oldco’s talc
assets and funds drawn by Oldco under the DIP Credit Agreement have been and
will be used to fund the Chapter 11 Cases.
Following the Chapter 11 filing, the activities
of the Chapter 11 Debtors are now subject to review and oversight by the
bankruptcy court. As a result, the Chapter 11 Debtors were deconsolidated as of
the Petition Date, and their assets and liabilities were derecognized from the
Company’s consolidated financial statements on a prospective basis.
On June 25, 2024, the committee representing
talc claimants (the “Committee”) filed a motion to dismiss the Chapter 11
Cases. The Bankruptcy Court denied that motion on April 29, 2025 and the
United States District Court for the Southern District of Texas (the “District
Court”) denied the Committee's motion seeking leave to appeal that order on
March 23, 2026. On September 14, 2026, the Committee again filed a motion to dismiss the Chapter 11 Cases in the District Court, which the Company has opposed. The District Court proceedings, including as to the motion to dismiss are stayed.
On May 14, 2025, the Bankruptcy Court entered a
Report and Recommendation (i) recommending that the District Court determine
whether any of the talc sold by Oldco contained sufficient quantity and form of
asbestos to cause mesothelioma or other asbestos-related diseases and (ii)
abating the Chapter 11 Cases pending a determination by the District
Court. On June 22, 2026, the District Court adopted the Bankruptcy Court's recommendation. On September 22, 2026, the Committee filed a petition for a writ of mandamus asking the U.S. Court of Appeals for the Fifth Circuit to direct the District Court to vacate the order adopting the Bankruptcy Court's recommendation. On October 2, 2026, the U.S. Court of Appeals for the Fifth Circuit stayed the District Court proceedings and agreed to hear oral argument on December 1, 2026 regarding the Committee's mandamus petition. The Company supports the path forward recommended by the Bankruptcy Court in its May 14, 2025 Report and Recommendation.
On June 29, 2026, to satisfy a deadline imposed by the Bankruptcy Court, the Company filed a Plan of Reorganization in the Chapter 11 Cases ("the Parent Plan"). The Parent Plan would provide for, among other things:
- The funding of a Talc Personal Injury Trust with
$
- Issuance of a channeling injunction pursuant to section 524(g) of the Bankruptcy Code to address all current and future talc-related claims through the Trust;
- Release of estate claims against the Company; and
- The Company's waiver of more than $
The Parent Plan is subject in all respects to the resolution of the District Court proceedings, which are currently stayed pending resolution of the Committee's mandamus petition. The Bankruptcy Court proceedings also remain abated.
In the first quarter of 2025, the Company
recorded a provision to establish an accrual of $215 million for estimated
costs to fund a trust to resolve all current and future talc-related claims as
well as fund the Chapter 11 Cases and related litigation costs (including the
aforementioned $30 million increase to the maximum principal amount of the DIP
Credit Agreement). Concurrent with the filing of the Parent Plan, the Company recorded a charge of $290 million in the second quarter of 2026 to increase the Company's reserve for estimated costs. The parties have not yet reached a final resolution of
all matters in the Chapter 11 Cases, and the Company is unable to estimate the
possible loss or range of loss beyond the amount accrued.
The Company records accruals for loss
contingencies associated with legal matters, including talc-related litigation
and the Chapter 11 Cases, when it is probable that a liability will be incurred
and the amount of the loss can be reasonably estimated. Amounts accrued for
legal contingencies often result from a complex series of judgments about
future events and uncertainties that rely heavily on estimates and assumptions
including timing of related payments. The ability to make such estimates and
judgments can be affected by various factors, including whether damages sought
in the proceedings are unsubstantiated or indeterminate, the stage of the
litigation, the factual and legal matters in dispute, the ability to achieve
comprehensive settlements, the availability of co-defendants with substantial
resources and assets participating in the litigation, and our evaluation of the
unique attributes of each claim.
19
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
The broader litigation and regulatory
environments for talc-related claims continue to evolve. Moreover, although the
Chapter 11 Cases are progressing, it is not possible at this time to predict
how the U.S. Court of Appeals for the Fifth Circuit and the District Court will rule on the matters before them, the form of any
ultimate resolution or when an ultimate resolution might occur. Given the
foregoing factors, it is reasonably possible that the Company will incur a loss
for liabilities associated with talc claims in excess of the amount accrued.
This risk is based on the potential for new talc-related claims that could
eventually be asserted together with their associated disposition cost and
related legal costs, despite the automatic stay with respect to claims against
the Chapter 11 Debtors, taking into account the portion of such hypothetical
claims that may be subject to indemnification by Pfizer, as well as the
inability to predict the amount that may ultimately be necessary to fully and
finally resolve all of the Chapter 11 Debtors’ future talc-related claims in
connection with a confirmed Chapter 11 plan of reorganization. In light of the
uncertainties involved in such matters, the resolution of, or recognition of
additional liabilities in connection with, current or future talc claims could
have a material adverse effect on the Company’s results of operations, cash
flows, and financial condition.
Note 13. Segment and Related Information
The Company determines its operating segments based on the discrete financial information that is regularly evaluated by its chief operating decision maker, our Chief Executive Officer, in deciding how to allocate resources and in assessing performance. The Company’s operating segments are strategic business units that offer different products and serve different markets. They are managed separately and require different technology and marketing strategies.
The Company has two reportable segments: Consumer & Specialties and Engineered Solutions. See Note 1 to the Condensed Consolidated Financial Statements.
The Company evaluates performance based on the operating income of the respective business units. The costs deducted to arrive at operating profit do not include several items, such as net interest or income tax expense. Depreciation expense related to corporate assets is allocated to the business segments and is included in their income from operations. However, such corporate depreciable assets are not included in the segment assets. Intersegment sales and transfers are not significant.
Segment revenues, expenses, operating income, and a reconciliation of the operating segment totals to the applicable line items on the Condensed Consolidated Financial Statements are as follows for the three and nine-month periods ended October 4, 2026 and September 28, 2025:
| Three Months Ended | |||||||||||||||||||||||
| Oct. 4, 2026 | Sep. 28, 2025 | ||||||||||||||||||||||
| Consumer & | Engineered | Consumer & | Engineered | ||||||||||||||||||||
| (in millions of dollars) | Specialties | Solutions | Total | Specialties | Solutions | Total | |||||||||||||||||
| Net sales | $ | $ | $ | $ | $ | $ | |||||||||||||||||
| Cost of goods sold | |||||||||||||||||||||||
| Segment production margin | |||||||||||||||||||||||
| Marketing and administrative expenses | |||||||||||||||||||||||
| Research and development expenses | |||||||||||||||||||||||
| Segment income from operations | $ | $ | $ | $ | $ | $ | |||||||||||||||||
20
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
| Nine Months Ended | |||||||||||||||||||||||
| Oct. 4, 2026 | Sep. 28, 2025 | ||||||||||||||||||||||
| Consumer & | Engineered | Consumer & | Engineered | ||||||||||||||||||||
| (in millions of dollars) | Specialties | Solutions | Total | Specialties | Solutions | Total | |||||||||||||||||
| Net sales | $ | $ | $ | $ | $ | $ | |||||||||||||||||
| Cost of goods sold | |||||||||||||||||||||||
| Segment production margin | |||||||||||||||||||||||
| Marketing and administrative expenses | |||||||||||||||||||||||
| Research and development expenses | |||||||||||||||||||||||
| Restructuring and other items | |||||||||||||||||||||||
| Gain on sale of assets, net | ( | ) | ( | ) | |||||||||||||||||||
| Segment income from operations | $ | $ | $ | $ | $ | $ | |||||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||
| Oct. 4, | Sep. 28, | Oct. 4, | Sep. 28, | ||||||||||||
| (in millions of dollars) | 2026 | 2025 | 2026 | 2025 | |||||||||||
| Segment income from operations | $ | $ | $ | $ | |||||||||||
| Interest expense, net | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
| Other non-operating income (deductions), net | ( | ) | ( | ) | |||||||||||
| Unallocated expenses: | |||||||||||||||
| Provision for litigation accrual and credit losses | |||||||||||||||
| Restructuring and other items | |||||||||||||||
| Litigation expenses | |||||||||||||||
| Unallocated corporate expenses | |||||||||||||||
| Income (loss) before tax and equity in earnings | $ | $ | $ | ( | ) | $ | ( | ) | |||||||
Segment information is as follows for the three and nine-month periods ended October 4, 2026 and September 28, 2025:
| Three Months Ended | Nine Months Ended | ||||||||||||||
| Oct. 4, | Sep. 28, | Oct. 4, | Sep. 28, | ||||||||||||
| (in millions of dollars) | 2026 | 2025 | 2026 | 2025 | |||||||||||
| Depreciation, Depletion, and Amortization | |||||||||||||||
| Consumer & Specialties | $ | $ | $ | $ | |||||||||||
| Engineered Solutions | |||||||||||||||
| Total | $ | $ | $ | $ | |||||||||||
| Capital Expenditures | |||||||||||||||
| Consumer & Specialties | $ | $ | $ | $ | |||||||||||
| Engineered Solutions | |||||||||||||||
| Corporate | |||||||||||||||
| Total | $ | $ | $ | $ | |||||||||||
21
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
The Company’s segment assets as of October 4, 2026 and December 31, 2025 are as follows:
| Oct. 4, | Dec. 31, | ||||||
| (in millions of dollars) | 2026 | 2025 | |||||
| Segment Assets | |||||||
| Consumer & Specialties | $ | $ | |||||
| Engineered Solutions | |||||||
| Corporate | |||||||
| Total | $ | $ |
The Company’s sales by product category are as follows:
| Three Months Ended | Nine Months Ended | ||||||||||||||
| Oct. 4, | Sep. 28, | Oct. 4, | Sep. 28, | ||||||||||||
| (in millions of dollars) | 2026 | 2025 | 2026 | 2025 | |||||||||||
| Household & Personal Care | $ | $ | $ | $ | |||||||||||
| Specialty Additives | |||||||||||||||
| High-Temperature Technologies | |||||||||||||||
| Environmental & Infrastructure | |||||||||||||||
| Total | $ | $ | $ | $ | |||||||||||
22
To the Shareholders and Board of Directors
Minerals Technologies Inc.:
Results of Review of Interim Financial Information
We have reviewed the condensed consolidated balance sheet of Minerals Technologies Inc. and subsidiaries (the Company) as of October 4, 2026, the related condensed consolidated statements of income (loss) and comprehensive income (loss) for the three-month and nine-month periods ended October 4, 2026 and September 28, 2025, the related condensed consolidated statements of cash flows for the nine-month periods ended October 4, 2026 and September 28, 2025, the related condensed consolidated statements of changes in shareholders’ equity for the three-month periods ended October 4, 2026 July 5, 2026 and April 5, 2026 and September 28, 2025, June 29, 2025 and March 30, 2025 and the related notes (collectively, the consolidated interim financial information). Based on our reviews, we are not aware of any material modifications that should be made to the consolidated interim financial information for it to be in conformity with U.S. generally accepted accounting principles.
We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheet of the Company as of December 31, 2025, and the related consolidated statements of income, comprehensive income, changes in shareholders’ equity, and cash flows for the year then ended (not presented herein); and in our report dated February 20, 2026, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of December 31, 2025 is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.
Basis for Review Results
This consolidated interim financial information
is the responsibility of the Company’s management. We are a public accounting
firm registered with the PCAOB and are required to be independent with respect
to the Company in accordance with the U.S. federal securities laws and the
applicable rules and regulations of the Securities and Exchange Commission and
the PCAOB.
We conducted our reviews in accordance with the
standards of the PCAOB. A review of consolidated interim financial information
consists principally of applying analytical procedures and making inquiries of
persons responsible for financial and accounting matters. It is substantially
less in scope than an audit conducted in accordance with the standards of the
PCAOB, the objective of which is the expression of an opinion regarding the
financial statements taken as a whole. Accordingly, we do not express such an
opinion.
/s/ KPMG LLP
New York, New York
October 30, 2026
23
Executive Summary
Our consolidated sales for the third quarter of 2026 were $554.9 million, an increase of 4% as compared with $532.4 million in the prior year. Income from operations was $64.8 million, as compared with income of $70.9 million in the prior year. Included in income from operations for the third quarter of 2026 and 2025 were $6.7 million and $7.5 million, respectively of litigation expenses incurred in connection with the bankruptcy of the Company's subsidiary BMI Oldco Inc (f/k/a Barretts Minerals Inc.) ("Oldco") and lawsuits related to talc products sold by Oldco.
Net income in the third quarter of 2026 was $42.7 million, as compared to net income of $43.0 million in the third quarter of 2025. Diluted earnings in the third quarter of both 2026 and 2025 was $1.37 per share.
Our balance sheet continues to be strong. Cash, cash equivalents, and short-term investments were $379.0 million as of October 4, 2026. On October 13, 2026, the Company completed a $400 million private offering of senior unsecured notes due 2032 and refinanced its revolving credit facility. The net proceeds of the notes were used, together with cash on hand, (i) to redeem all of its outstanding 5.000% senior notes due 2028 and (ii) to pay transaction fees and expenses related to the notes offering and the refinancing of the revolving credit facility. As a result, the Company had more than $800 million of available liquidity, including cash on hand as well as availability under its revolving credit facility. We believe that these factors will allow us to meet our anticipated funding requirements.
Outlook
The global trade environment is dynamic.
Beginning in the first quarter of 2025, the United States government has
imposed tariffs on goods imported into the U.S. from numerous countries and
multiple nations have responded with reciprocal tariffs and other actions.
While the Company generally manufactures products in the markets where they are
sold, our businesses and suppliers import certain goods subject to U.S. imposed
tariffs, in particular in our High-Temperature Technologies product line, as
well as goods subject to reciprocal tariffs and other measures imposed by other
countries. On February 20, 2026, the U.S. Supreme Court issued a ruling
striking down certain tariffs imposed by the U.S., including those affecting
certain goods that the Company imports. However, the timing and amount of any
potential tariff refunds remains uncertain, and are subject to further legal,
regulatory, and administrative developments. In addition, the U.S. has
initiated new tariffs and may impose additional tariffs. As a result,
there remains significant uncertainty regarding the scope and duration of
existing and future tariffs, and the impact of such tariffs will continue to
vary. We continue to pursue available options to mitigate the impact of these
tariffs and other measures. We have made operational and supply chain
changes, utilized available exemptions or exclusions, and, where feasible,
increased the prices of our goods and services. To date, as a result of
our mitigation efforts, tariffs have not had a significant effect on our
financial results. However, the imposition of tariffs as well as
uncertainty about their scope and duration could negatively affect demand,
result in increases in some input costs and/or inflation that we are unable to
mitigate, or otherwise adversely affect economic conditions. The Company
continues to monitor the economic effects of the trade environment, but the
effects associated with the tariffs remain uncertain.
In addition to evolving U.S. tariffs, our
operating environment is affected by other market forces, including recent
geopolitical events in the Middle East. As a result of such events, we
have experienced higher energy prices and freight expenses, among other
effects. As with tariffs, we are pursuing available options to mitigate
the impacts of these market forces. To date, these market forces have not had a
significant effect on our financial results, but the extent of future impacts,
and our ability to mitigate them, remains uncertain.
The Company will continue to focus on innovation and new product development and other opportunities for sales growth in 2026 from its existing businesses, as follows:
Consumer & Specialties Segment
- Increase our presence and market share in global cat litter products, including in emerging markets.
- Deploy new products in pet care, such as lightweight litter.
- Increase our sales of calcium carbonate products by further penetration into filling and coating applications in the paper and packaging markets.
- Promote the Company’s expertise in crystal engineering by developing crystal morphologies that help our customers achieve functional benefits.
- Deploy new calcium carbonate products in paint, coating, and packaging applications.
24
- Continue developing products and processes for waste management and recycling opportunities to reduce the environmental impact of our customers by reducing energy consumption and improving the sustainability of their products.
- Continue to develop innovative applications for our bleaching earth products for edible oil and renewable fuel industries.
- Develop natural and mineral-based solutions for personal care applications.
- Increase our presence and market share globally for retinol delivery technology for personal care applications.
- Expand our bentonite product solutions for animal health applications.
- Increase our presence and market share in fabric care, including in emerging markets.
Engineered Solutions Segment
- Increase our presence and gain penetration of our bentonite-based foundry solutions in emerging markets.
- Deploy value-added formulations of refractory materials.
- Deploy our laser measurement technologies into new applications.
- Expand our refractory maintenance model to other steel makers globally.
- Deploy our calcium metal technologies to support steelmaking and other industries.
- Continue the development and market penetration of our FLUORO-SORB® adsorbent products which address PFAS contamination in soil, groundwater, drinking water sources, landfill leachate, and wastewater treatment facilities.
- Pursue opportunities for the expanded use of our products in environmental, building and construction, infrastructure, and oil and gas drilling, and water treatment globally.
- Increase our presence and market share for geosynthetic clay liners globally.
All Segments
- Further Operational Excellence principles into all aspects of the organization, including system infrastructure and lean principles.
- Continue to explore selective acquisitions to fit our competencies in minerals and our core technologies.
However, there can be no assurance that we will achieve success in implementing any one or more of these opportunities.
25
Results of Operations
Three-month period ended October 4, 2026 as compared with three-month period ended September 28, 2025
Consolidated Income Statement Review
| Three Months Ended | |||||||||||
| Oct. 4, | Sep. 28, | % | |||||||||
| (in millions of dollars) | 2026 | 2025 | Change | ||||||||
| Net sales | $ | 554.9 | $ | 532.4 | 4 | % | |||||
| Cost of goods sold | 425.7 | 395.4 | 8 | % | |||||||
| Production margin | 129.2 | 137.0 | (6 | )% | |||||||
| Production margin % | 23.3 | % | 25.7 | % | |||||||
| Marketing and administrative expenses | 52.0 | 53.0 | (2 | )% | |||||||
| Research and development expenses | 5.7 | 5.6 | 2 | % | |||||||
| Litigation expenses | 6.7 | 7.5 | (11 | )% | |||||||
| Income from operations | 64.8 | 70.9 | (9 | )% | |||||||
| Operating margin % | 11.7 | % | 13.3 | % | |||||||
| Interest expense, net | (12.1 | ) | (13.8 | ) | (12 | )% | |||||
| Other non-operating income (deductions), net | 0.3 | (0.5 | ) | * | |||||||
| Total non-operating deductions, net | (11.8 | ) | (14.3 | ) | (17 | )% | |||||
| Income before tax and equity in earnings | 53.0 | 56.6 | (6 | )% | |||||||
| Provision for taxes on income | 12.2 | 13.5 | (10 | )% | |||||||
| Effective tax rate | 23.0 | % | 23.9 | % | |||||||
| Equity in earnings of affiliates, net of tax | 3.0 | 1.1 | 173 | % | |||||||
| Net income | 43.8 | 44.2 | (1 | )% | |||||||
| Net income attributable to non-controlling interests | 1.1 | 1.2 | (8 | )% | |||||||
| Net income attributable to Minerals Technologies Inc. | $ | 42.7 | $ | 43.0 | (1 | )% | |||||
* Percentage not meaningful
Net Sales
| Three Months Ended | Three Months Ended | ||||||||||||||||||
| Oct. 4, 2026 | Sep. 28, 2025 | ||||||||||||||||||
| (in millions of dollars) | Net Sales | % of Total Net Sales | % Change | Net Sales | % of Total Net Sales | ||||||||||||||
| U.S. | $ | 287.7 | 52 | % | 5 | % | $ | 273.3 | 51 | % | |||||||||
| International | 267.2 | 48 | % | 3 | % | 259.1 | 49 | % | |||||||||||
| Total net sales | $ | 554.9 | 100 | % | 4 | % | $ | 532.4 | 100 | % | |||||||||
| Consumer & Specialties Segment | $ | 278.1 | 50 | % | 0 | % | $ | 277.4 | 52 | % | |||||||||
| Engineered Solutions Segment | 276.8 | 50 | % | 9 | % | 255.0 | 48 | % | |||||||||||
| Total net sales | $ | 554.9 | 100 | % | 4 | % | $ | 532.4 | 100 | % | |||||||||
26
Worldwide net sales increased by 4% to $554.9 million in the third quarter from $532.4 million in the prior year.
Net sales in the United States increased to $287.7 million in the third quarter of 2026 from $273.3 million in the third quarter of 2025. International sales increased to $267.2 million from $259.1 million in the prior year.
Operating Costs and Expenses
Cost of goods sold was $425.7 million and represented 76.7% of sales for the three-month period ended October 4, 2026, as compared with $395.4 million and 74.3% of sales in the prior year. Production margin decreased from 25.7% of sales in the prior year to 23.3% of sales in the third quarter of 2026, primarily due to higher energy, transportation, and raw material costs.
Marketing and administrative costs were $52.0 million and 9.4% of sales for the three-month period ended October 4, 2026, as compared to $53.0 million and 10.0% of sales in the prior year.
Research and development expenses were $5.7 million and represented 1.0% of sales for the three-month period ended October 4, 2026, as compared with $5.6 million and 1.1% of sales in the prior year.
The Company recorded litigation and settlement expenses of $6.7 million and $7.5 million during the three-month periods ending October 4, 2026 and September 28, 2025, respectively in connection with the bankruptcy of Oldco and lawsuits related to talc products sold by Oldco.
Income from Operations
The Company recorded income from operations of $64.8 million as compared to income of $70.9 million in the prior year. Income from operations includes litigation expenses in connection with Oldco’s bankruptcy filing and lawsuits related to talc products sold by Oldco of $6.7 million and $7.5 million during the three-month periods ended October 4, 2026 and September 28, 2025, respectively.
Other Non-Operating Deductions, net
In the third quarter of 2026, non-operating deductions were $11.8 million, as compared with $14.3 million in the prior year. Included in other non-operating deductions in the third quarter of 2026 was net interest expense of $12.1 million, as compared to $13.8 million in the third quarter of the prior year.
Provision for Taxes on Income
Provision for taxes on income was $12.2 million, as compared with $13.5 million in the prior year. The effective tax rate was 23.0%, as compared with 23.9% in the prior year.
Net Income Attributable to MTI Shareholders
Net income attributable to MTI shareholders was $42.7 million for the three-month period ended October 4, 2026, and included a $5.1 million charge, net of tax. This charge primarily consisted of litigation and settlement expenses in connection with Oldco’s bankruptcy filing and lawsuits related to talc products sold by Oldco.
Net income attributable to MTI shareholders was $43.0 million for the three-month period ended September 28, 2025, and included a $5.6 million charge, net of tax. This charge primarily consisted of litigation and settlement expenses in connection with Oldco’s bankruptcy filing and lawsuits related to talc products sold by Oldco.
27
Segment Review
The following discussions highlight the operating results for each of our two segments.
| Three Months Ended | ||||||||||||
| Oct. 4, | Sep. 28, | % | ||||||||||
| Consumer & Specialties Segment | 2026 | 2025 | Change | |||||||||
| (in millions of dollars) | ||||||||||||
| Net Sales | ||||||||||||
| Household & Personal Care | $ | 130.5 | $ | 129.8 | 1 | % | ||||||
| Specialty Additives | 147.6 | 147.6 | 0 | % | ||||||||
| Total net sales | $ | 278.1 | $ | 277.4 | 0 | % | ||||||
| Income from operations | $ | 24.8 | $ | 37.4 | (34 | )% | ||||||
| % of net sales | 8.9 | % | 13.5 | % | ||||||||
Net sales in the Consumer & Specialties segment were $278.1 million for the three-month period ended October 4, 2026, as compared with $277.4 million in the prior year. Household & Personal Care sales increased 1% to $130.5 million, as compared with $129.8 million in the prior year. Sales in Specialty Additives were $147.6 million for both three-month periods ended October 4, 2026 and September 28, 2025.
Income from operations decreased to $24.8 million, as compared to $37.4 million in the prior year due to higher energy, transportation, and raw material costs as well as temporary maintenance downtime at a large Specialty Additives facility in the U.S. that impacted production and profitability at the site.
| Three Months Ended | ||||||||||||
| Oct. 4, | Sep. 28, | % | ||||||||||
| Engineered Solutions Segment | 2026 | 2025 | Change | |||||||||
| (in millions of dollars) | ||||||||||||
| Net Sales | ||||||||||||
| High-Temperature Technologies | $ | 192.3 | $ | 178.9 | 7 | % | ||||||
| Environmental & Infrastructure | 84.5 | 76.1 | 11 | % | ||||||||
| Total net sales | $ | 276.8 | $ | 255.0 | 9 | % | ||||||
| Income from operations | $ | 48.7 | $ | 44.8 | 9 | % | ||||||
| % of net sales | 17.6 | % | 17.6 | % | ||||||||
Net sales in the Engineered Solutions segment increased 9% to $276.8 million from $255.0 million in the prior year. High-Temperature Technologies sales increased 7% to $192.3 million, as compared with $178.9 million in the prior year, primarily driven by higher sales to steel customers globally and from our North American foundry business. Environmental & Infrastructure sales increased 11% to $84.5 million, as compared with $76.1 million in the prior year driven by stronger sales related to environmental lining and remediation products, building materials, and infrastructure drilling products.
Income from operations was $48.7 million and 17.6% of sales, as compared with $44.8 million and 17.6% of sales in the prior year.
28
Nine-month period ended October 4, 2026 as compared with nine-month period ended September 28, 2025
Consolidated Income (Loss) Statement Review
| Nine Months Ended | |||||||||||
| Oct. 4, | Sep. 28, | % | |||||||||
| (in millions of dollars) | 2026 | 2025 | Change | ||||||||
| Net sales | $ | 1,650.2 | $ | 1,553.1 | 6 | % | |||||
| Cost of goods sold | 1,256.1 | 1,159.6 | 8 | % | |||||||
| Production margin | 394.1 | 393.5 | 0 | % | |||||||
| Production margin % | 23.9 | % | 25.3 | % | |||||||
| Marketing and administrative expenses | 162.8 | 155.8 | 4 | % | |||||||
| Research and development expenses | 17.7 | 17.1 | 4 | % | |||||||
| Provision for litigation accrual and credit losses | 290.0 | 215.0 | 35 | % | |||||||
| Restructuring and other items | - | 11.3 | * | ||||||||
| Gain on sale of assets, net | - | (5.6 | ) | * | |||||||
| Litigation expenses | 20.4 | 14.5 | 41 | % | |||||||
| Loss from operations | (96.8 | ) | (14.6 | ) | * | ||||||
| Operating margin % | * | * | |||||||||
| Interest expense, net | (37.5 | ) | (41.6 | ) | (10 | )% | |||||
| Other non-operating income (deductions), net | 1.9 | (4.4 | ) | * | |||||||
| Total non-operating deductions, net | (35.6 | ) | (46.0 | ) | (23 | )% | |||||
| Loss before tax and equity in earnings | (132.4 | ) | (60.6 | ) | * | ||||||
| Benefit for taxes on income | (24.1 | ) | (4.7 | ) | 413 | % | |||||
| Effective tax rate | 18.2 | % | 7.8 | % | |||||||
| Equity in earnings of affiliates, net of tax | 6.8 | 3.4 | 100 | % | |||||||
| Net loss | (101.5 | ) | (52.5 | ) | * | ||||||
| Net income attributable to non-controlling interests | 3.2 | 3.1 | 3 | % | |||||||
| Net loss attributable to Minerals Technologies Inc. | $ | (104.7 | ) | $ | (55.6 | ) | * | ||||
* Percentage not meaningful
Net Sales
| Nine Months Ended | Nine Months Ended | ||||||||||||||||||
| Oct. 4, 2026 | Sep. 28, 2025 | ||||||||||||||||||
| (in millions of dollars) | Net Sales | % of Total Net Sales | % Change | Net Sales | % of Total Net Sales | ||||||||||||||
| U.S. | $ | 843.7 | 51 | % | 3 | % | $ | 817.6 | 53 | % | |||||||||
| International | 806.5 | 49 | % | 10 | % | 735.5 | 47 | % | |||||||||||
| Total net sales | $ | 1,650.2 | 100 | % | 6 | % | $ | 1,553.1 | 100 | % | |||||||||
| Consumer & Specialties Segment | $ | 849.2 | 51 | % | 3 | % | $ | 823.4 | 53 | % | |||||||||
| Engineered Solutions Segment | 801.0 | 49 | % | 10 | % | 729.7 | 47 | % | |||||||||||
| Total net sales | $ | 1,650.2 | 100 | % | 6 | % | $ | 1,553.1 | 100 | % | |||||||||
29
Total net sales increased 6% from the previous year to $1,650.2 million. Net sales in the United States increased 3% to $843.7 million from $817.6 million in the prior year. International sales increased by 10% to $806.5 million from $735.5 million in the prior year.
Operating Costs and Expenses
Cost of goods sold increased 8% from the prior year and was 76.1% of sales, as compared with 74.7% in the prior year. Gross margin decreased to 23.9% of sales as compared with 25.3% of sales in the prior year, primarily due to higher energy, transportation, and raw material costs.
Marketing and administrative costs were $162.8 million and 9.9% of sales for the nine-month period ended October 4, 2026, as compared to $155.8 million and 10.0% of sales in the prior year.
Research and development expenses were $17.7 million and represented 1.1% of sales for the nine-month period ended October 4, 2026, as compared with $17.1 million and 1.1% of sales in the prior year.
During the nine-month period ended October 4, 2026, the Company filed a Plan of Reorganization in the Chapter 11 case of its subsidiary, Oldco, which would provide for, among other things, the funding of a trust to resolve all current and future talc-related claims for alleged exposure to asbestos-contaminated talc products sold by Oldco. Accordingly, the Company recorded a charge of $290 million to increase the Company's accrual for estimated costs.
During the nine-month periods ended October 4, 2026 and September 28, 2025, the Company also recorded litigation expenses of $20.4 million and $14.5 million, respectively, in connection with Oldco’s bankruptcy filing and lawsuits related to talc products sold by Oldco.
Additionally, during the nine-month period ended September 28, 2025, the Company recorded an $11.3 million restructuring and other items charge for the write-down of assets and severance and other costs, offset by a $5.6 million net gain on the final installment for the sale of refractories manufacturing assets in China.
Loss from Operations
The Company recorded a loss from operations of $96.8 million for the nine-month period ended October 4, 2026, as compared to a loss of $14.6 million in the prior year. Loss from operations included a provision for litigation accrual and credit losses of $290 million and $215 million for the nine-month periods ended October 4, 2026 and September 28, 2025, respectively. In addition, during the nine-month periods end September 28, 2025, the Company recorded an $11.3 million restructuring and other items charge for the write-down of assets and severance and other costs, offset by a $5.6 million net gain on the final installment for the sale of refractories manufacturing assets in China.
Loss from operations during the nine-month periods ended October 4, 2026 and September 28, 2025 includes $20.4 million and $14.5 million, respectively, of litigation expenses in connection with Oldco’s bankruptcy filing and lawsuits related to talc products sold by Oldco.
Other Non-Operating Income (Deductions), net
The Company recorded non-operating deductions of $35.6 million for the nine-month period ended October 4, 2026, as compared with $46.0 million in the prior year. Included in non-operating income (deductions) for the nine-month periods ended October 4, 2026 and September 28, 2025 is $37.5 million and $41.6 million, respectively, of net interest expense.
Benefit for Taxes on Income
Benefit for taxes on income was $24.1 million, as compared to $4.7 million in the prior year. The effective tax rate was 18.2%, as compared to 7.8% in the prior year. The tax benefit was in both years was attributable to the litigation accrual.
Net Loss Attributable to MTI Shareholders
Net loss attributable to MTI shareholders was $104.7 million during the nine-month period ended October 4, 2026, and included a $245.1 million charge, net of tax. This charge consisted of a provision for litigation accrual and credit losses and litigation expenses.
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Net loss attributable to MTI shareholders was $55.6 million during the nine-month period ended September 28, 2025, and included a $189.5 million charge, net of tax. This charge consisted of a provision for litigation accrual and credit losses, restructuring and other items, litigation expenses, and a net gain on sale of assets.
Segment Review
The following discussions highlight the operating results for each of our two segments.
| Nine Months Ended | ||||||||||||
| Oct. 4, | Sep. 28, | % | ||||||||||
| Consumer & Specialties Segment | 2026 | 2025 | Change | |||||||||
| (in millions of dollars) | ||||||||||||
| Net Sales | ||||||||||||
| Household & Personal Care | $ | 396.3 | $ | 380.3 | 4 | % | ||||||
| Specialty Additives | 452.9 | 443.1 | 2 | % | ||||||||
| Total net sales | $ | 849.2 | $ | 823.4 | 3 | % | ||||||
| Income from operations | $ | 86.6 | $ | 98.9 | (12 | )% | ||||||
| % of net sales | 10.2 | % | 12.0 | % | ||||||||
Net sales in the Consumer & Specialties segment increased 3% to $849.2 million from $823.4 million in the prior year. Household & Personal Care sales increased 4% to $396.3 million as compared to $380.3 million in the prior year driven by animal health, and edible oil and renewable fuel purification sales. Sales in Specialty Additives increased 2% to $452.9 million as compared to $443.1 million in the prior year, driven by higher sales to paper and packaging customers.
Income from operations was $86.6 million and 10.2% of sales as compared to $98.9 million and 12% of sales in the prior year. Included in income from operations for the nine-month period ended September 28, 2025 was $5.8 million of restructuring and other items.
| Nine Months Ended | ||||||||||||
| Oct. 4, | Sep. 28, | % | ||||||||||
| Engineered Solutions Segment | 2026 | 2025 | Change | |||||||||
| (in millions of dollars) | ||||||||||||
| Net Sales | ||||||||||||
| High-Temperature Technologies | $ | 565.9 | $ | 526.7 | 7 | % | ||||||
| Environmental & Infrastructure | 235.1 | 203.0 | 16 | % | ||||||||
| Total net sales | $ | 801.0 | $ | 729.7 | 10 | % | ||||||
| Income from operations | $ | 136.8 | $ | 125.2 | 9 | % | ||||||
| % of net sales | 17.1 | % | 17.2 | % | ||||||||
Net sales in the Engineered Solutions segment increased to $801.0 million from $729.7 million in the prior year. High-Temperature Technologies’ sales increased 7% to $565.9 million as compared to $526.7 million in the prior year, primarily driven by continued higher sales to steel customers and sales to foundry customers in North America and Asia. Environmental & Infrastructure sales increased 16% to $235.1 million from $203.0 million in the prior year, primarily driven by stronger sales related to building materials, large-scale project activity, and infrastructure drilling.
Income from operations was $136.8 million and 17.1% of net sales as compared to $125.2 million and 17.2% of sales in the prior year. Included in income from operations for the nine-month period ended September 28, 2025 was $3.3 million of restructuring and other items, offset by a $5.6 million net gain on the final installment for the sale of refractories manufacturing assets in China.
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Liquidity and Capital Resources
Cash flow provided by operations during the nine-month period ended October 4, 2026, was approximately $171.0 million. Cash flows from operations during the first nine months of 2026 were principally used to fund capital expenditures, repurchase shares, and to pay the Company’s dividend to common shareholders. The aggregate maturities of long-term debt are as follows: remainder of 2026 - $1.6 million; 2027 - $6.0 million; 2028 - $405.8 million; 2029 - $5.7 million; 2030 - $5.7 million; thereafter - $540.5 million.
On November 26, 2024, the Company entered into a Refinancing Facility Agreement and Incremental Facility Amendment (the “Amendment”) to amend the Company’s previous credit agreement (the “Previous Credit Agreement;" the previous credit agreement, as amended by the Amendment, being the “Amended Credit Agreement”). The Amendment provides for, among other things, a new senior secured revolving credit facility with aggregate commitments of $400 million (the “Revolving Facility”), a portion of which may be used for the issuance of letters of credit and swingline loans, and a new senior secured term loan facility with aggregate commitments of $575 million (the “Term Loan Facility” and, together with the Revolving Facility, the “Senior Secured Credit Facilities”). The Revolving Facility and the Term Loan Facility replace the facilities under the Previous Credit Agreement, which provided for, among other things, a $550 million senior secured term loan facility and a $300 million senior secured revolving credit facility. The maturity date for loans and commitments under the Revolving Facility is November 26, 2029, and the maturity date for loans under the Term Loan Facility is November 26, 2031; provided that the maturity dates of the Revolving Facility and the Term Loan Facility will be adjusted to the date that is 91 days prior to the stated maturity date of the Company’s 5.0% Senior Notes due 2028 (the “Notes”) unless, prior to the date that is 91 days prior to the stated maturity date of the Notes, all amounts in excess of $50 million of the Notes have been either (a) refinanced with indebtedness permitted under the Amended Credit Agreement maturing later than 90 days after the scheduled maturity date of the Revolving Facility or of the Term Loan Facility, as applicable, or (b) repaid, discharged or repaid (other than with the proceeds of any indebtedness maturing earlier than 91 days after the scheduled maturity date of the Revolving Facility or of the Term Loan Facility, as applicable). Loans under the Term Loan Facility amortize at a rate equal to 1.00% per annum, payable in equal quarterly installments, and were issued with original issue discount at 99.875% of par.
Loans under the Revolving Facility will bear interest at a rate equal to (a) for loans denominated in U.S. dollars, at the election of the Company, Term SOFR plus an applicable margin equal to 1.375% per annum, or a base rate plus an applicable margin equal to 0.375% per annum, (b) for loans denominated in Euros, adjusted EURIBOR plus an applicable margin equal to 1.375% per annum and (c) for loans denominated in Pounds Sterling, SONIA plus an applicable margin equal to 1.375% per annum, subject in each case to (i) an increase of 37.5 basis points in the event that, and for so long as, the Net Leverage Ratio (as defined in the Amended Credit Agreement) is greater than or equal to 3.00 to 1.00 as of the last day of the preceding fiscal quarter, (ii) an increase of 12.5 basis points in the event that, and for so long as, the Net Leverage Ratio is less than 3.00 to 1.00 and greater than or equal to 2.00 to 1.00 as of the last day of the preceding fiscal quarter, and (iii) a decrease of 12.5 basis points in the event that, and for so long as, the Net Leverage Ratio is less than 1.00 to 1.00 as of the last day of the preceding fiscal quarter. Loans under the Term Loan Facility will bear interest at a rate equal to, at the election of the Company, Term SOFR plus an applicable margin equal to 2.00% per annum or a base rate plus an applicable margin equal to 1.00% per annum. The Company will pay certain fees under the Amended Credit Agreement, including (a) a commitment fee of 0.175% per annum on the undrawn portion of the Revolving Facility (subject to a step-ups to 0.300% and 0.250% and a step-down to 0.150% at the same levels described above), (b) a fronting fee of 0.125% per annum on the average daily undrawn amount of, plus unreimbursed amounts in respect of disbursements under, letters of credit issued under the Revolving Facility and (c) customary annual administration fees. The obligations of the Company under the Senior Secured Credit Facilities are unconditionally guaranteed jointly and severally by, subject to certain exceptions, all material domestic subsidiaries of the Company (the “Guarantors”) and secured, subject to certain exceptions, by a security interest in substantially all of the tangible and intangible assets of the Company and the Guarantors.
On
October 13, 2026, the Company entered into a Refinancing Facility Agreement and
Incremental Facility Amendment (the “2026 Amendment”) to amend the Amended
Credit Agreement (the Amended Credit Agreement, as amended by the 2026
Amendment, the “2026 Amended Credit Agreement”). The 2026 Amendment provides
for, among other things, a new senior secured revolving credit facility with
aggregate commitments of $500,000,000 (the “2026 Refinancing Revolving
Facility”), a portion of which may be used for the issuance of letters of
credit and swingline loans. The 2026 Refinancing Revolving Facility replaces
the Revolving Facility. The maturity date for loans and commitments under the 2026
Refinancing Revolving Facility is October 13, 2031; provided that the
maturity date of the 2026 Refinancing Revolving Facility will be adjusted to
the date that is 91 days prior to the stated maturity date of the Term Loan
Facility unless, prior to the date that is 91 days prior to the stated maturity
date of the Term Loan Facility, all amounts in excess of $50,000,000 of the
Term Loan Facility have been either (a) refinanced with indebtedness permitted
under the 2026 Amended Credit Agreement maturing later than 90 days after the
scheduled maturity date of the Term Loan Facility or (b) discharged or repaid
(other than with the proceeds of any indebtedness maturing earlier than 91 days
after the scheduled maturity date of the 2026 Refinancing Revolving Facility).
The 2026 Amendment does not change any terms of the Term Loan Facility and,
except as set forth above, the terms of the 2026 Refinancing Revolving Facility
(including interest rates and fees) remain the same as the Revolving Facility.
As of October 4, 2026, there were no loans and $11.2 million in letters of credit outstanding under the Revolving Facility.
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On June 30, 2020, the Company issued $400 million
aggregate principal amount of 5.0% Senior Notes due 2028 (the “2028 Notes”). The
2028 Notes were issued pursuant to an indenture, dated as of June 30, 2020,
between the Company and The Bank of New York Mellon Trust Company, N.A., as
trustee (the “2020 Indenture”). The 2028 Notes bore an interest rate of
5.0% per annum payable semi-annually on January 1 and July 1 of each year,
beginning on January 1, 2021. The 2028 Notes were unconditionally
guaranteed on a senior unsecured basis by each of the Company’s existing and
future wholly owned domestic restricted subsidiaries that is a borrower under
or that guarantees the Company’s obligations under its Senior Secured Credit
Facilities or that guarantees the Company’s or any of the Company’s wholly
owned domestic subsidiaries’ long-term indebtedness in an aggregate amount in
excess of $50 million.
On
October 13, 2026, the Company completed an offering of $400,000,000 aggregate
principal amount of its 7.500% Senior Notes due 2032 (the “2032 Notes”). The
Company used the net proceeds of its offering of the 2032 Notes, together with
cash on hand, (i) to redeem all of the outstanding 2028 Notes and (ii) to pay
transaction fees and expenses related to the offering of 2032 Notes and the 2026 Amendment. The terms of the 2032 Notes are governed by an
indenture dated as of October 13, 2026 (the “2026 Indenture”), among the
Company, the subsidiary guarantors party thereto and U.S. Bank Trust Company,
National Association, as trustee (the “2026 Trustee”).
The
2032 Notes bear interest at a rate of 7.500% per annum payable semi-annually in
arrears on January 15 and July 15 of each year, beginning on January 15, 2027.
The 2032 Notes are guaranteed by the Company’s wholly owned domestic restricted
subsidiaries that are obligors or guarantors under its Senior Secured Credit
Facilities or certain other indebtedness.
At
any time and from time to time prior to January 15, 2029, the Company may
redeem some or all of the 2032 Notes for cash at a redemption price equal to
100% of their principal amount, plus the “make-whole” premium described in the 2026
Indenture and accrued and unpaid interest, if any, to, but excluding, the
applicable redemption date. Beginning on January 15, 2029, the Company may
redeem some or all of the 2032 Notes at any time and from time to time at the applicable redemption
prices listed in the Indenture, plus accrued and unpaid interest, if any, to,
but excluding, the applicable redemption date. In addition, at any time and from time to time prior to January 15,
2029, the Company may redeem up to 40% of the aggregate principal amount of the
2032 Notes with funds from one or more equity offerings at a redemption price
equal to 107.500% of the principal amount thereof, plus accrued and unpaid
interest, if any, to, but excluding, the applicable redemption date.
If the Company experiences a change of control (as defined in the indenture), the Company is required to offer to repurchase the 2032 Notes at 101% of the principal amount of such Notes, plus accrued and unpaid interest, if any, to, but excluding, the date of repurchase.
The Amended Credit Agreement, the 2020 Indenture, as well as the 2026 Amended Credit Agreement and the 2026 Indenture, contain certain customary affirmative and negative covenants that limit or restrict the ability of the Company and its restricted subsidiaries to enter into certain transactions or take certain actions, as well as customary events of default. In addition, the Amended Credit Agreement and the 2026 Amended Credit Agreement contain a financial covenant that requires the Company to maintain a maximum Net Leverage Ratio of 4.00 to 1.00 for each four fiscal quarter period (subject to an increase to 5.00 to 1.00 for four quarters in connection with certain significant acquisitions). The Company was in compliance with all the covenants contained in the Amended Credit Agreement throughout the period covered by this report.
The Company had a committed loan facility in Japan. In the second quarter of 2026, the Company repaid the remaining balance of $0.4 million.
As part of the Concept Pet acquisition, the Company assumed $1.9 million in long-term debt, recorded at fair value, consisting of two term loans, one that matured in 2025 and one that matures in 2027. The outstanding loan has annual payments and carries a variable interest rate. The Company repaid $0.1 million on this loan during the first nine months of 2026.
As of October 4, 2026, the Company had $13.9 million in uncommitted short-term bank credit lines, of which none were in use. The credit lines are primarily outside the U.S. and are generally one year in term at competitive market rates at large, well-established institutions. The Company typically uses its available credit lines to fund working capital requirements or local capital spending needs.
We anticipate that capital expenditures for 2026 should be approximately $100 million, principally related to opportunities to improve our operations and meet our strategic growth objectives. We expect to meet our other long-term financing requirements from internally generated funds and committed and uncommitted bank credit lines.
In the second quarter of 2023, the Company entered into a new floating to fixed interest rate swap for a notional amount of $150 million. This instrument matured in May 2026. In the second quarter of 2026, the Company entered into a new floating to fixed interest rate swap for a notional amount of $150 million. The fair value of this instrument at October 4, 2026 is an asset of $3.8 million.
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On October 16, 2024, the Company’s Board of Directors authorized the Company’s management to repurchase, at its discretion, up to $200 million of the Company’s shares. As of October 4, 2026, 1,152,442 shares have been repurchased under this program for $71.9 million, or an average price of approximately $62.37 per share. This authorization has no expiration date.
The Company is required to make future payments under various contracts, including debt agreements and lease agreements. The Company also has commitments to fund its pension plans and provide payments for other postretirement benefit plans. During the nine-month period ended October 4, 2026, there were no material changes in the Company’s contractual obligations.
The Company and certain of the Company’s subsidiaries are among numerous defendants in over one thousand cases seeking damages for alleged exposure to asbestos-contaminated talc products sold by the Company’s subsidiary Oldco. The Company’s position is that these cases are meritless and all talc products sold by Oldco are safe. On October 2, 2023 (the “Petition Date”), notwithstanding the Company’s confidence in the safety of Oldco’s talc products, Oldco and Barretts Ventures Texas LLC (“BVT” and together with Oldco, the “Chapter 11 Debtors”) filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas (the “Chapter 11 Cases”) to address and comprehensively resolve Oldco’s liabilities associated with talc. Minerals Technologies Inc. and the Company’s other subsidiaries were not included in the Chapter 11 filing.
The Chapter 11 Debtors’ stated goal in the Chapter 11 Cases is to confirm a plan of reorganization under Section 524(g) of the U.S. Bankruptcy Code and utilize this provision of the Bankruptcy Code to establish a trust that will address all current and future talc-related claims. On June 29, 2026, to satisfy a deadline imposed by the Bankruptcy Court, the Company filed a Plan of Reorganization in the Chapter 11 Cases ("the Parent Plan"). The Parent Plan would provide for, among other things:
- The funding of a Talc Personal Injury Trust with $450 million from the Company for the payment of current and future talc-related claims;
- Issuance of a channeling injunction pursuant to section 524(g) of the Bankruptcy Code to address all current and future talc-related claims through the Trust;
- Release of estate claims against the Company; and
- The Company's waiver of more than $100 million in claims against the Chapter 11 Debtors related to pre-petition and post-petition funding.
On May 14, 2025, the Bankruptcy Court entered a Report
and Recommendation (i) recommending that the District Court determine whether
any of the talc sold by Oldco contained sufficient quantity and form of
asbestos to cause mesothelioma or other asbestos-related diseases and (ii)
abating the Chapter 11 Cases pending a determination by the District Court. On
June 22, 2026, the District Court adopted the Bankruptcy Court's
recommendation. On September 22, 2026,
the Committee filed a petition for a writ of mandamus asking the U.S. Court of
Appeals for the Fifth Circuit to direct the District Court to vacate the order
adopting the Bankruptcy Court’s recommendation. On October 2, 2026, the U.S. Court of Appeals
for the Fifth Circuit stayed the District Court proceedings and agreed to hear oral
argument on December 1, 2026 regarding the Committee’s mandamus petition. The Company supports the path forward recommended
by the Bankruptcy Court in its May 14, 2025 Report and Recommendation. The Parent Plan is subject in all respects to
the resolution of the District Court proceedings, which are currently stayed
pending resolution of the Committee’s mandamus petition. The Bankruptcy Court
proceedings also remain abated.
In the second quarter of 2024, Oldco sold its talc assets under section 363 of the U.S. Bankruptcy Code. In addition, in the second quarter of 2024, the Company entered into a Debtor-in-Possession Credit Agreement with Oldco (the “DIP Credit Agreement”) and recorded a provision for credit loss of $30 million for the maximum principal amount under such DIP Credit Agreement. The Company amended the DIP Credit Agreement to increase the maximum principal amount available under the DIP Credit Agreement by $30 million in the second quarter of 2025 and another $2.6 million in 2026. Proceeds of the sale of Oldco’s talc assets, as well as the funds drawn by Oldco under the DIP Credit Agreement, have been and will be used to fund the Chapter 11 Cases.
In the first quarter of 2025, the Company recorded a provision to establish an accrual of $215 million for estimated costs to fund a trust to resolve all current and future talc-related claims as well as fund the Chapter 11 Cases and related litigation costs (including the aforementioned $30 million increase to the maximum principal amount of the DIP Credit Agreement). Concurrent
with the filing of the Parent Plan, the Company recorded a charge of $290
million in the second quarter of 2026 to increase the Company’s reserve for
estimated costs. The parties have not yet reached a final resolution of all matters in the Chapter 11 Cases, and the Company is unable to estimate the possible loss or range of loss beyond the amount accrued.
34
During the pendency of the Chapter 11 Cases, the Company anticipates that the Chapter 11 Debtors will benefit from the operation of the automatic stay, which stays ongoing litigation in connection with talc-related claims against Oldco. In addition, the Bankruptcy Court temporarily enjoined the filing or continued prosecution of all talc-related claims against the Chapter 11 Debtors’ non-debtor affiliates, subject to certain exceptions. Such exceptions consist of claims premised solely on alleged inadequacies in testing of talc sold by Oldco. The Company is vigorously opposing and defending against these claims. The Chapter 11 Debtors have been deconsolidated from the Company’s financial statements since the Petition Date.
Although the Chapter 11 Cases are progressing, it is not possible to predict how the U.S. Court of Appeals for the Fifth Circuit and the District Court will rule on the matters before them, the form of any ultimate resolution, or when an ultimate resolution might occur at this time. Accordingly, the Company is unable to estimate the possible loss or range of loss related to the amount that will be necessary to fully and finally resolve all of the Chapter 11 Debtors’ current and future talc-related claims in connection with a confirmed Chapter 11 plan of reorganization beyond the amount accrued. See Note 12 to the Condensed Consolidated Financial Statements included in this report for more information.
Cautionary Statement for “Safe Harbor” Purposes under the Private Securities Litigation Reform Act of 1995
The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by or on behalf of the Company. This report contains statements that the Company believes may be “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, particularly statements relating to the Company’s objectives, plans or goals, future actions, future performance or results of current and anticipated products, sales efforts, expenditures, and financial results. From time to time, the Company also provides forward-looking statements in other publicly-released materials, both written and oral. Forward-looking statements provide current expectations and forecasts of future events such as new products, revenues, and financial performance, and are not limited to describing historical or current facts. They can be identified by the use of words such as “outlook,” “forecast,” “believes,” “expects,” “plans,” “intends,” “anticipates,” and other words and phrases of similar meaning.
Forward-looking statements are necessarily based on assumptions, estimates and limited information available at the time they are made. A broad variety of risks and uncertainties, both known and unknown, as well as the inaccuracy of assumptions and estimates, can affect the realization of the expectations or forecasts in these statements. Many of these risks and uncertainties are difficult to predict or are beyond the Company’s control. Consequently, no forward-looking statement can be guaranteed. Actual future results may vary materially. Significant factors that could affect the expectations and forecasts include worldwide general economic, business, and industry conditions; the cyclicality of our customers’ businesses and their changing regional demands; our ability to compete in very competitive industries; consolidation in customer industries, principally paper, foundry and steel; our ability to renew or extend long term sales contracts for our satellite operations; our ability to generate cash to service our debt; our ability to comply with the covenants in the agreements governing our debt; our ability to effectively achieve and implement our growth initiatives or consummate the transactions described in the statements; our ability to successfully develop new products; our ability to defend our intellectual property; the increased risks of doing business abroad including with respect to changes in tariffs; the availability of raw materials and access to ore reserves at our mining operations, or increases in costs of raw materials, energy, or shipping; compliance with or changes to regulation in the areas of environmental, health and safety, and tax; risks and uncertainties related to the voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code filed by our subsidiaries BMI Oldco Inc. (f/k/a Barretts Minerals Inc.) and Barretts Ventures Texas LLC; claims for legal, environmental and tax matters or product stewardship issues; operating risks and capacity limitations affecting our production facilities; seasonality of some of our businesses; cybersecurity and other threats relating to our information technology systems; and other risk factors set forth under “Item 1A — Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, and in Exhibit 99 to this Quarterly Report on Form 10-Q.
The Company undertakes no obligation to update any forward-looking statements to reflect events or circumstances that arise after the date hereof. Investors should refer to the Company’s subsequent filings under the Securities Exchange Act of 1934 for further disclosures.
35
Recently Issued Accounting Standards
Changes to accounting principles generally accepted in the United States of America (U.S. GAAP) are established by the Financial Accounting Standards Board (FASB) in the form of accounting standards updates (ASUs) to the FASB’s Accounting Standards Codification. The Company considers the applicability and impact of all ASUs. ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on our consolidated financial position and results of operations.
Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses
In November 2024, the FASB issued ASU 2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses”, that requires entities to disclose additional information in the notes to the financial statements about prescribed categories underlying any relevant income statement expense caption. The new standard is effective for annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. The adoption of this standard is not expected to have a material impact on the Company’s Consolidated Financial Statements but will result in disaggregation of the Company’s income statement expenses.
Critical Accounting Policies and Estimates
Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities.
On an ongoing basis, we evaluate our estimates and assumptions, including those related to revenue recognition, valuation of long-lived assets, goodwill and other intangible assets, income taxes, including valuation allowances and pension plan assumptions. We base our estimates on historical experience and on other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that cannot readily be determined from other sources. There can be no assurance that actual results will not differ from those estimates.
There have been no material changes to the critical accounting estimates that our accounting policies require us to make in the preparation of our consolidated financial statements, as described in the 2025 Annual Report on Form 10-K.
Market risk represents the risk of loss that may impact our financial position, results of operations or cash flows due to adverse changes in market prices and foreign currency and interest rates. We are exposed to market risk because of changes in foreign currency exchange rates as measured against the U.S. dollar. We do not anticipate that near-term changes in exchange rates will have a material impact on our future earnings or cash flows. However, there can be no assurance that a sudden and significant decline in the value of foreign currencies would not have a material adverse effect on our financial condition and results of operations. A portion of our long-term bank debt bears interest at variable rates; therefore, our results of operations would be affected by interest rate changes to the extent of such outstanding bank debt. An immediate 10 percent change in interest rates would not have a material effect on our results of operations over the next fiscal year. A one-percent change in interest rates, inclusive of the impact of our interest rate derivatives, would result in $4.2 million in incremental interest charges on an annual basis.
We do not enter into derivatives or other financial instruments for trading or speculative purposes. When appropriate, we enter into derivative financial instruments, such as forward exchange contracts, hedges, and interest rate swaps, to mitigate the impact of foreign exchange rate movements and interest rate movements on our operating results. The counterparties are major financial institutions. Such forward exchange contracts, hedges, and interest rate swaps would not subject us to additional risk from exchange rate or interest rate movements because gains and losses on these contracts would offset losses and gains on the assets, liabilities, and transactions being hedged.
In the second quarter of 2023, the Company entered into a floating to fixed interest rate swap for a notional amount of $150 million. This instrument matured in May 2026. In the second quarter of 2026, the Company entered into a new floating to fixed interest rate swap for a notional amount of $150 million. The fair value of this instrument at October 4, 2026 is an asset of $3.8 million.
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Evaluation of Disclosure Controls and Procedures
As of the end of the period covered by this report, and under the supervision and with participation of the Company’s management, including the Chief Executive Officer and the Chief Financial Officer, the Company carried out an evaluation of the effectiveness of the design and operation of the Company’s disclosure controls and procedures, pursuant to Exchange Act Rule 13a-15(b). Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that as of the end of the period covered by this report the Company’s disclosure controls and procedures were effective.
Changes in Internal Control Over Financial Reporting
There were no changes in the Company’s internal controls over financial reporting during the quarter ended October 4, 2026 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
PART II – OTHER INFORMATION
From time to time, the Company and its subsidiaries are the subject of various legal actions and claims arising in the ordinary course of their businesses. The most significant litigation facing the Company are cases seeking damages for alleged exposure to asbestos-contaminated talc products sold by the Company's subsidiary BMI Oldco Inc. (f/k/a Barretts Minerals Inc.) ("Oldco") and the talc-related Chapter 11 cases of Oldco and Barretts Ventures Texas LLC. Additional information regarding legal proceedings is disclosed in Note 12 to the Condensed Consolidated Financial Statements included elsewhere in this report, which disclosure is incorporated herein by reference.
For a description of Risk Factors, see Exhibit 99 attached to this report. There have been no material changes to our risk factors from those disclosed in our 2025 Annual Report on Form 10-K.
| Total | Total Number of | Dollar Value of | |||||||||||||
| Number | Average | Shares Purchased as | Shares that May | ||||||||||||
| of Shares | Price Paid | Part of the Publicly | Yet be Purchased | ||||||||||||
| Purchased | Per Share | Announced Program | Under the Program | ||||||||||||
| July 6 - August 2 | - | $ | - | 1,102,129 | $ | 131,671,215 | |||||||||
| August 3 - August 30 | 22,671 | $ | 72.74 | 1,124,800 | $ | 130,022,077 | |||||||||
| August 31 - October 4 | 27,642 | $ | 68.64 | 1,152,442 | $ | 128,124,597 | |||||||||
| Total | 50,313 | $ | 70.49 |
On October 16, 2024, the Company’s Board of Directors authorized the Company’s management to repurchase, at its discretion, up to $200 million of the Company’s shares. As of October 4, 2026, 1,152,442 shares have been repurchased under this program for $71.9 million, or an average price of approximately $62.37 per share. This authorization has no expiration date.
Not applicable.
The information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in Exhibit 95 to this Quarterly Report on Form 10-Q.
37
During the three-month period ended October 4, 2026, none of our directors or executive officers adopted terminated
| Exhibit No. |
Exhibit Title
|
|
| 4.1 | Indenture, dated as of October 13, 2026, by and among Minerals Technologies Inc., the subsidiary guarantors from time to time party thereto and U.S. Bank Trust Company, National Association, as trustee (incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K filed on October 13, 2026) | |
| 10.1 | Refinancing Facility Agreement and Incremental Facility Amendment dated as of October 13, 2026, among Minerals Technologies Inc., certain subsidiaries party thereto, the lenders party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on October 13, 2026)* | |
| 15 |
Letter Regarding Unaudited Interim Financial Information.
|
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| 31.1 |
Rule 13a-14(a)/15d-14(a) Certification executed by the Company’s principal executive officer.
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| 31.2 |
Rule 13a-14(a)/15d-14(a) Certification executed by the Company’s principal financial officer.
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| 32 |
Section 1350 Certifications.
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| 95 |
Information concerning Mine Safety Violations
|
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| 99 |
Risk Factors
|
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| 101.INS | XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document). | |
| 101.SCH |
Inline XBRL Taxonomy Extension Schema
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|
| 101.CAL |
Inline XBRL Taxonomy Extension Calculation Linkbase
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|
| 101.DEF |
Inline XBRL Taxonomy Extension Definition Linkbase
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|
| 101.LAB |
Inline XBRL Taxonomy Extension Label Linkbase
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|
| 101.PRE |
Inline XBRL Taxonomy Extension Presentation Linkbase
|
|
| 104 |
Cover Page Interactive Data File (formatted as inline XBRL and contain in Exhibit 101).
|
*Pursuant to Item 601(a)(5)
of Regulation S-K, certain exhibits and schedules to this agreement have been
omitted. The registrant agrees to furnish supplementally to the Securities and
Exchange Commission a copy of any omitted exhibit or schedule upon request by
the Securities and Exchange Commission.
38
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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Minerals Technologies Inc.
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By:
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/s/ Erik C. Aldag
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Erik C. Aldag
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Senior Vice President, Finance and Treasury,
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Chief Financial Officer
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October 30, 2026
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39
EXHIBIT 15
ACCOUNTANTS' ACKNOWLEDGEMENT
October 30, 2026
Minerals Technologies Inc.
New York, New York
Re: Registration Statement Nos. 333-160002, 33-59080, 333-62739, 333-138245, 333-206244, 333-249761, and 333-282854
With respect to the subject registration statements, we acknowledge our awareness of the use therein of our report dated October 30, 2026, related to our review of interim financial information.
Pursuant to Rule 436 under the Securities Act of 1933 (the Act), such report is not considered part of a registration statement prepared or certified by an independent registered public accounting firm, or a report prepared or certified by an independent registered public accounting firm within the meaning of Sections 7 and 11 of the Act.
/s/ KPMG LLP
New York, New York
EXHIBIT 31.1
RULE 13a-14(a)/15d-14(a) CERTIFICATION
I, Douglas T. Dietrich, certify that:
1.
I have reviewed this Quarterly Report on Form 10-Q of Minerals Technologies Inc.;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors:
(a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
(b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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Date: October 30, 2026
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By:
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/s/ Douglas T. Dietrich
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Douglas T. Dietrich
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Chairman of the Board and Chief Executive Officer
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EXHIBIT 31.2
RULE 13a-14(a)/15d-14(a) CERTIFICATION
I, Erik C. Aldag, certify that:
1.
I have reviewed this Quarterly Report on Form 10-Q of Minerals Technologies Inc.;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors:
(a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
(b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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Date: October 30, 2026
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By:
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/s/ Erik C. Aldag
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Erik C. Aldag
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Senior Vice President, Finance and Treasury,
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Chief Financial Officer
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EXHIBIT 32
SECTION 1350 CERTIFICATIONS
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350 of Chapter 63 of Title 18, United States Code), each of the undersigned officers of Minerals Technologies Inc., a Delaware corporation (the "Company"), does hereby certify that:
The Quarterly Report on Form 10-Q for the quarter ended October 4, 2026 (the "Form 10-Q") of the Company fully
complies with the requirements of Section 13(a) or 15(d) of the Securities
Exchange Act of 1934, and information contained in the Form 10-Q fairly
presents, in all material respects, the financial condition and results of
operations of the Company.
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Date: October 30, 2026
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By:
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/s/ Douglas T. Dietrich
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Douglas T. Dietrich
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Chairman of the Board and Chief Executive Officer
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Date: October 30, 2026
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By:
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/s/ Erik C. Aldag
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Erik C. Aldag
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Senior Vice President, Finance and Treasury,
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Chief Financial Officer
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The foregoing certification is being furnished solely pursuant to Exchange Act Rule 13a-14(b); is not deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section; and is not deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act of 1934.
Exhibit 95
Section 1503 of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K contain certain reporting requirements regarding coal or other mine safety. The Company, through its subsidiaries Specialty Minerals Inc. and American Colloid Company, operates twelve mines in the United States. The operation of our mines is subject to regulation by the Federal Mine Safety and Health Administration (“MSHA”) under the Federal Mine Safety and Health Act of 1977 (the “Mine Act”). MSHA inspects our mines on a regular basis and issues various citations and orders when it believes a violation has occurred under the Mine Act.
The following table sets forth the required information with respect to each mine for which we are the operator during the period of July 6, 2026, to October 4, 2026:
|
Mine
|
Section 104(a) S&S | Section 104(b) | Section 104(d) | Section 110(b)(2) | Section 107(a) | Proposed Assessments | Fatalities |
| (A) | (B) | (C) | (D) | (E) | (F) | (G) | |
| Lucerne Valley, CA 04-00219 | 0 | 0 | 0 | 0 | 0 | $8,600 | 0 |
| Canaan, CT 06-00019 | 0 | 0 | 0 | 0 | 0 | $0 | 0 |
| Adams, MA 19-00035 | 2 | 0 | 0 | 0 | 0 | $0 | 0 |
| Belle/Colony Mine, WY 48-00888 | 0 | 0 | 0 | 0 | 0 | $0 | 0 |
| Belle Fourche Mill, SD 39-00049 | 0 | 0 | 0 | 0 | 0 | $302 | 0 |
| Colony East, WY 48-00594 | 0 | 0 | 0 | 0 | 0 | $0 | 0 |
| Colony West, WY 48-00245 | 0 | 0 | 0 | 0 | 0 | $0 | 0 |
| Gascoyne, ND 32-00459 | 0 | 0 | 0 | 0 | 0 | $10,832 | 0 |
| Lovell, WY 48-00057 | 0 | 0 | 0 | 0 | 0 | $0 | 0 |
| Sandy Ridge, AL 01-00093 | 0 | 0 | 0 | 0 | 0 | $151 | 0 |
| Yellowtail, WY 48-00607 | 0 | 0 | 0 | 0 | 0 | $0 | 0 |
| Ste. Genevieve, MO 23-02564 | 0 | 0 | 0 | 0 | 0 | $0 | 0 |
(A)
The total number of violations of mandatory health or safety standards that could significantly and substantially contribute to the cause and effect of a mine safety or health hazard under section 104 of the Mine Act for which we received a citation from MSHA.
(B)
The total number of orders issued under section 104(b) of the Mine Act.
(C)
The total number of citations and orders for unwarrantable failure of the Company to comply with mandatory health or safety standards under section 104(d) of the Mine Act.
(D)
The total number of flagrant violations under section 110(b)(2) of the Mine Act.
(E)
The total number of imminent danger orders issued under section 107(a) of the Mine Act.
(F)
The total dollar value of proposed assessments from MSHA under the Mine Act.
(G)
The total number of mining-related fatalities, other than fatalities determined by MSHA to be unrelated to mining activity.
1
During the period of July 6, 2026, to October 4, 2026, we did not receive any written notice from MSHA, with respect to any mine for which we are the operator, of (A) a pattern of violations of mandatory health or safety standards that are of such nature as could have significantly and substantially contributed to the cause and effect of mine health and safety hazards under section 104(e) of the Mine Act or (B) the potential to have such a pattern.
The following table sets forth the required information with respect to legal actions before the Federal Mine Safety and Health Review Commission involving each mine for which we are the operator for the period July 6, 2026, to October 4, 2026:
|
Mine
|
Legal Actions Pending As Of Last Day Of Period
|
Legal Actions Initiated During Period
|
Legal Actions Resolved During Period
|
|
Lucerne Valley, CA
|
0 | 0 | 0 |
|
Canaan, CT
|
0 | 0 | 0 |
|
Adams, MA
|
0 | 0 | 0 |
|
Belle/Colony Mine, WY
|
0 | 0 | 0 |
|
Belle Fourche Mill, SD
|
0 | 0 | 0 |
|
Colony East, WY
|
0 | 0 | 0 |
|
Colony West, WY
|
0 | 0 | 0 |
|
Gascoyne, ND
|
0 | 0 | 0 |
|
Lovell, WY
|
0 | 0 | 0 |
|
Sandy Ridge, AL
|
0 | 0 | 0 |
|
Yellowtail, WY
|
0 | 0 | 0 |
|
Ste. Genevieve, MO
|
0 | 0 | 0 |
EXHIBIT 99
RISK FACTORS
Our business faces significant risks. Set forth below are all risks that we believe are material at this time. Our business, financial condition and results of operations could be materially adversely affected by any of these risks. These risks should be read in conjunction with the other information in the Company's Annual Report on Form 10-K for the year ended December 31, 2025, and this Quarterly Report on Form 10-Q.
Industry and Market Risks
Worldwide general economic, business, and industry conditions may have an adverse effect on the Company’s results.
The Company’s business and operating results are
affected by worldwide and regional economic, business, and industry conditions.
In recent years, we have experienced, among other things, declining consumer
and business confidence, volatile raw material prices, instability in credit
markets, high unemployment, fluctuating interest and exchange rates, and other
challenges in the countries in which we operate. Uncertainty or a deterioration
in the economic conditions affecting the businesses to which, or geographic
areas in which, we sell products could reduce demand for our products and
inflationary pressures may increase our costs. The Company’s customers and
potential customers may experience deterioration of their businesses, cash flow
shortages, and difficulty obtaining financing. As discussed below, the
industries we serve have in the past been adversely affected by the uncertain
global economic climate due to the cyclical nature of their businesses. As a
result, existing or potential customers may reduce or delay their growth and
investments and their plans to purchase products, pursue inventory reduction
measures, and may not be able to fulfill their obligations in a timely fashion.
Further, suppliers could experience similar conditions, which could affect
their ability to fulfill their obligations to the Company. We may also
experience pricing pressure on products and services or be unsuccessful in
passing along to our customers an increase in our raw materials costs or energy
prices, which could decrease our revenues and have an adverse effect on our
financial condition and cash flows. Adversity within capital markets may also
impact the Company’s results of operations by negatively affecting the amount
of expense the Company records for its pension and other postretirement benefit
plans. Actuarial valuations used to calculate income or expense for the plans
reflect assumptions about financial market and other economic conditions – the
most significant of which are the discount rate and the expected long-term rate
of return on plan assets. Such actuarial valuations may change based on changes
in key economic indicators. Global economic markets remain uncertain, and there
can be no assurance that market conditions will improve in the near future.
Future weakness in the global economy could materially and adversely affect our
business and operating results.
A number of our customers’ businesses are cyclical or have changing regional demands. Our operations are subject to these trends, and we may not be able to mitigate these risks.
In the paper industry, which is served by the
Specialty Additives product line of our Consumer & Specialties segment,
production levels for uncoated freesheet within North America and Europe, our
two largest markets, are projected to continue to decrease. The reduced demand
for premium writing paper products has resulted in closures and conversions of
mills in both North America and Europe. Additionally, the Specialty
Additives product line is affected by the domestic residential building and construction
markets, as well as the automotive market.
A significant portion of the sales of the
High-Temperature Technologies product line of our Engineered Solutions segment
are derived from the metalcasting market. The metalcasting market is dependent
upon the demand for castings for automobile and heavy truck components, farm
and construction equipment, oil and gas production equipment, power generation
equipment, and rail car components. Many of these types of equipment are
sensitive to fluctuations in demand during periods of recession or difficult economic
conditions. This product line also serves the steel industry. In recent
years, global steel production has been volatile. These trends have affected
and may continue to affect the demand for our Engineered Solutions segment’s
products and services. The Environmental & Infrastructure product line
of our Engineered Solutions segment serves the commercial construction,
environmental remediation, infrastructure, and oil and gas markets.
Demand for our products is subject to trends in
these markets. During periods of economic slowdown, our customers often reduce
their capital expenditure and defer or cancel pending projects. Such
developments occur even amongst customers that are not experiencing financial
difficulties. In addition, these trends could cause our customers to face
liquidity issues or bankruptcy, which could deteriorate the aging of our
accounts receivable, increase our bad debt exposure and possibly trigger
impairment of assets or realignment of our businesses. The Company has taken
steps to reduce its exposure to variations in its customers’ businesses,
including by diversifying its portfolio of products and services through
geographic expansion, growth in less cyclical consumer-oriented markets, and by
structuring most of its long-term satellite contracts to provide a degree of
protection against declines in the quantity of product purchased, since the
price per ton of our products generally rises as the number of tons purchased
declines. In addition, many of our product lines lower our customers’ costs of
production or increase their productivity, which should encourage them to use
our products. However, there can be no assurance that these efforts will
mitigate the risks of our dependence on these industries. Continued weakness in
the industries we serve has had, and may in the future have, an adverse effect
on sales of our products and our results of operations. A continued or renewed
economic downturn in one or more of the industries or geographic regions that
the Company serves, or in the worldwide economy, could cause actual results of
operations to differ materially from historical and expected results.
The Company operates in very competitive industries, which could adversely affect our profitability.
The Company has many competitors. Some of our
principal competitors have greater financial and other resources than we have.
Accordingly, these competitors may be better able to withstand economic
downturns and changes in conditions within the industries in which we operate
and may have significantly greater operating and financial flexibility than we
do. We also face competition for some of our products from alternative
products, and some of the competition we face comes from competitors in
lower-cost production countries like China and India. As a result of the
competitive environment in the markets in which we operate, we currently face
and will continue to face pressure on the sales prices of our products from
competitors, which could reduce profit margins.
The Company’s sales could be adversely affected by consolidation in customer industries.
Several consolidations in the paper industry
have taken place in recent years and such consolidation could continue in the
future. These consolidations could result in partial or total closure of some
paper mills where the Company operates satellite plants. Such closures would
reduce the Company’s sales, except to the extent that they resulted in shifting
paper production and associated purchases of calcium carbonate to another
location served by the Company. Similarly, consolidations have occurred in the
foundry and steel industries. Such consolidations in the major industries we
serve concentrate purchasing power in the hands of a smaller number of
manufacturers, enabling them to increase pressure on suppliers, such as the
Company. This increased pressure could have an adverse effect on the Company’s
results of operations in the future.
The Company’s sales could be adversely affected by our failure to renew or extend long-term sales contracts for our satellite operations.
The Company’s sales of calcium carbonate to
paper customers are typically pursuant to long-term evergreen agreements,
initially ten to fifteen years in length, with paper mills where the Company
operates satellite plants. Sales pursuant to these contracts represent a
significant portion of our sales in the Specialty Additives product line of the
Consumer & Specialties segment. The terms of many of these agreements have
been extended or renewed in the past, often in connection with an expansion of
the satellite plant. However, failure of a number of the Company’s customers to
renew or extend existing agreements on terms as favorable to the Company as
those currently in effect, or at all, could have a substantial adverse effect
on the Company’s results of operations, and could also result in impairment of
the assets associated with the satellite plant.
Financial Risks
Servicing the Company’s debt will require a significant amount of cash. This could reduce the Company’s flexibility to respond to changing business and economic conditions or fund capital expenditures or working capital needs. Our ability to generate cash depends on many factors beyond our control.
At October 4, 2026, the Company had $957.8 million
aggregate principal amount of total indebtedness (consisting primarily of
$565.0 million aggregate principal amount of loans under our term facility,
$400.0 million aggregate principal amount of notes and no
loans outstanding under our revolving credit facility) and an additional
$388.8 million of borrowing capacity under the revolving credit facility (after
giving effect $11.2 million of outstanding letters
of credit). On October 13, 2026, we amended our revolving credit facility to, among other things, increase the borrowing capacity thereunder by $100.0 million. Our outstanding indebtedness will require a significant amount of
cash to make interest payments. Further, the interest rate on a significant
portion of our borrowings under our senior secured credit facility is based on
SOFR interest rates, which has resulted in and could continue to result in
higher interest expense in the event of increases in interest rates. Our
ability to pay interest on our debt and to satisfy our other debt obligations
will depend in part upon our future financial and operating performance and upon
our ability to renew or refinance borrowings. Prevailing economic conditions
and financial, business, competitive, regulatory, and other factors, many of
which are beyond our control, will affect our ability to make these payments.
We cannot guarantee that our business will generate sufficient cash flow from
operations or that future borrowings will be available to us in an amount
sufficient to enable us to fund our liquidity needs. If we are unable to
generate sufficient cash flow to meet our debt service obligations, we will
have to pursue one or more alternatives, such as reducing or delaying capital
or other expenditures, refinancing debt, selling assets, or raising equity
capital. Further, the requirement to make significant interest payments may
reduce the Company’s flexibility to respond to changing business and economic
conditions or fund capital expenditure or working capital needs and may
increase the Company’s vulnerability to adverse economic conditions.
The agreements and instruments governing our debt contain various covenants that could significantly impact our ability to operate our business.
The agreement governing our senior secured
credit facility and the indenture that governs our 7.5% Senior Notes due 2032 contain a number of significant covenants that, among other things, limit our
ability to: incur or guarantee additional indebtedness, pay dividends or make
other distributions or repurchase or redeem capital stock, prepay, redeem or
repurchase certain debt, issue certain preferred stock or similar equity
securities, make loans and investments, sell or otherwise dispose of assets,
incur liens, enter into transactions with affiliates, enter into agreements
restricting our subsidiaries’ ability to pay dividends and consolidate, merge
or sell all or substantially all of our assets. In addition, we are required to
comply with specific financial ratios, including a maximum net leverage ratio,
under which we are required to achieve specific financial results. Our ability
to comply with these provisions may be affected by events beyond our control. A
breach of any of these covenants would result in a default under the applicable
agreements. In the event of any default under our senior secured credit
facility, our lenders could elect to declare all amounts borrowed under the
credit agreement, together with accrued interest thereon, to be due and payable.
In such an event, we cannot assure you that we would have sufficient assets to
pay debt then outstanding under the credit agreement, the indenture governing
our notes, and any other agreements governing our debt. Any future refinancing
of the senior secured credit facility is likely to contain similar restrictive
covenants. We may also incur future debt obligations that might subject us to
additional restrictive covenants that could affect our financial and
operational flexibility. We cannot assure you that we will be granted waivers
or amendments to these agreements if for any reason we are unable to comply
with these agreements or that we will be able to refinance our debt on terms
acceptable to us, or at all.
Technology, Development and Growth Risks
The Company’s results could be adversely affected if it is unable to effectively achieve and implement its growth initiatives.
Sales and income growth of the Company depends
upon a number of uncertain events. Growth will depend in part on sales growth
from our existing businesses and customers. The Company has a strategic growth
initiative to increase penetration into geographic markets such as Brazil,
China, and India as well as other Asian and Eastern European countries. The
Company also has a strategic growth initiative to increase penetration into
consumer-oriented markets such as cat litter, personal care, animal and health
care and natural oil purification. Our strategy also anticipates growth through
future acquisitions. However, our ability to identify and consummate any future
acquisitions on terms that are favorable to us may be limited by the number of
attractive acquisition targets, internal demands on our resources, and our
ability to obtain financing. Our success in integrating newly acquired
businesses will depend upon our ability to retain key personnel, avoid
diversion of management’s attention from operational matters, and integrate
general and administrative services. In addition, future acquisitions could
result in the incurrence of additional debt, costs, and contingent liabilities.
Integration of acquired operations may take longer, or be more costly or
disruptive to our business, than originally anticipated, and it is also
possible that expected synergies from future acquisitions may not materialize.
We also may incur costs and divert management attention with regard to
potential acquisitions that are never consummated. Difficulties, delays, or
failure of any of these strategies could affect the future growth rate of the
Company.
Delays or failures in new product development could adversely affect the Company’s operations.
The Company’s future business success will
depend in part upon its ability to maintain and enhance its technological
capabilities, to respond to changing customer needs, and to successfully
anticipate or respond to technological changes on a cost-effective and timely
basis. The Company is engaged in a continuous effort to develop new products
and processes in all of its product lines. Difficulties, delays, or failures in
the development, testing, production, marketing, or sale of such new products
could cause actual results of operations to differ materially from our expected
results.
The Company’s ability to compete is dependent upon its ability to defend its intellectual property against inappropriate disclosure, theft, and infringement.
The Company’s ability to compete is based in
part upon proprietary knowledge, both patented and unpatented. The Company’s
ability to achieve anticipated results depends in part on its ability to defend
its intellectual property against inappropriate disclosure and theft as well as
against infringement. In addition, development by the Company’s competitors of
new products or technologies that are more effective or less expensive than
those the Company offers could have a material adverse effect on the Company’s
financial condition or results of operations.
The Company’s operations could be impacted by the increased risks of doing business abroad.
The Company does business in many areas
internationally. Approximately 48% of our sales in 2025 were derived from
outside the United States and we have significant production facilities which
are located outside of the United States. We have in recent years expanded
our operations in emerging markets, and we plan to continue to do so in the
future, particularly in Brazil, China, India, the Middle East, and Eastern
Europe. Some of our operations are located in areas that have experienced
political or economic instability, including Brazil, China, Egypt, Indonesia,
Malaysia, Nigeria, Saudi Arabia, South Africa, Thailand, and Turkey. As the
Company expands its operations overseas, it faces increased risks of doing
business abroad, including inflation, fluctuation in interest rates, changes in
applicable laws and regulatory requirements, nationalization, expropriation,
limits on repatriation of funds, civil unrest, unstable governments and legal
systems, and other factors. The U.S. and foreign countries may also adopt or
increase restrictions on foreign trade or investment, including currency
exchange controls, tariffs or other taxes, or limitations on imports or
exports.
Beginning in the first quarter of 2025, the
United States government has imposed additional tariffs on goods imported into
the U.S. from numerous countries and multiple nations have responded with
reciprocal tariffs and other actions. On February 20, 2026, the United States
Supreme Court issued a ruling striking down certain tariffs imposed by the
U.S., including those affecting certain goods that the Company imports.
However, the timing and amount of any potential tariff refunds remains
uncertain, and are subject to further legal, regulatory, and administrative
developments. In addition, the U.S. has initiated new tariffs and may impose
additional tariffs. As a result, there remains significant uncertainty
regarding the scope and duration of existing and future tariffs, and the impact
of such tariffs will continue to vary. While the Company generally manufactures
products in the markets where they are sold, our businesses and suppliers
import certain goods subject to U.S. imposed tariffs, in particular in our
High-Temperature Technologies product line, as well as goods subject to
reciprocal tariffs and other measures imposed by other countries. However,
the imposition of tariffs as well as uncertainty about their scope and duration
could negatively affect demand, result in an increase in some input costs
and/or inflation that we are unable to mitigate, or otherwise adversely affect
economic conditions. The Company continues to monitor the economic effects of
the trade environment, but the effects associated with the tariffs remain
uncertain.
Further, geopolitical and terrorism threats,
including armed conflict among countries, could in the future affect our
business overseas, including leading to, among other things, higher costs,
impairment of our or our customers’ ability to conduct operations, adverse
impact to our employees, and a loss of our investment. As a result of recent
geopolitical events in the Middle East, we have experienced higher energy
prices and freight expenses, among other effects. The broader consequences of
geopolitical and terrorism threats, which may include sanctions that prohibit
our ability to do business in specific countries, embargoes, supply chain
disruptions, potential contractual breaches and litigation, regional
instability, and geopolitical shifts, cannot be predicted. We are also subject
to increased risks of natural disasters, public health crises, including the
occurrence of a contagious disease or illness, such as COVID-19, and other
catastrophic events in such countries. Many of these risks are beyond our control
and can lead to sudden, and potentially prolonged, changes in demand for our
products, difficulty in enforcing agreements, and losses in the realizability
of our assets.
In addition, a significant portion of our raw
material purchases and sales outside the United States are denominated in
foreign currencies, and liabilities for non-U.S. operating expenses and income
taxes are denominated in local currencies. Accordingly, reported sales, net
earnings, cash flows, and fair values have been and, in the future, will be
affected by changes in foreign currency exchange rates. Our overall success as
a global business depends, in part, upon our ability to succeed in differing legal,
regulatory, economic, social, and political conditions. We cannot assure you
that we will implement policies and strategies that will be effective in each
location where we do business.
Adverse developments in any of the areas in
which we do business could cause actual results to differ materially from
historical and expected results.
The Company’s operations are dependent on the availability of raw materials and access to ore reserves at its mining operations. Increases in costs of raw materials, energy, or shipping could adversely affect our financial results.
The Company depends in part on having an
adequate supply of raw materials for its manufacturing operations, particularly
lime and carbon dioxide for the production of PCC, and magnesia and alumina for
its refractory operations. Purchase prices and availability of these critical
raw materials are subject to volatility. At any given time, we may be unable to
obtain an adequate supply of these critical raw materials on a timely basis, on
price and other terms, or at all. While most such raw materials are readily
available, the Company has purchased approximately 57% of its magnesia
requirements from sources in China over the past five years. The price and
availability of magnesia have fluctuated in the past and they may fluctuate in
the future. Price increases for certain other of our raw materials, including
petrochemical products, as well as increases in energy prices, have also
affected our business. Our production processes consume a significant amount of
energy, primarily electricity, diesel fuel, natural gas, and coal. We use
diesel fuel to operate our mining and processing equipment, and our freight
costs are heavily dependent upon fuel prices and surcharges. Energy costs also
affect the cost of raw materials. On a combined basis, these factors represent
a large exposure to petrochemical and energy products which have been, and may
continue to be, subject to significant price fluctuations. The contracts
pursuant to which we construct and operate our PCC satellite plants generally
adjust pricing to reflect the pass-through of increases in costs resulting from
inflation, including energy. However, there is a time lag before such price
adjustments can be implemented. The Company and its customers will typically
negotiate reasonable price adjustments in order to recover these escalating
costs, but there can be no assurance that we will be able to recover increasing
costs through such negotiations.
The Company also depends on having adequate
access to ore reserves of appropriate quality at its mining operations. There
are numerous uncertainties inherent in estimating ore reserves including
subjective judgments and determinations that are based on available geological,
technical, contract, and economic information. In addition, mining permits,
leases, and other rights are, or may be, required for certain of the Company’s
mining operations. Such permits, leases, and other rights are subject to modification,
renewal, and revocation. Our ability to maintain such mining permits, leases,
and other rights has been, and may continue to be, affected by changes in laws,
regulations, and governmental actions, particularly in emerging markets such as
China and Turkey. We cannot assure you that we will be able to maintain such
mining permits, leases, and other rights to the extent we currently maintain
them or at all.
The Company relies on shipping cargos of
bentonite from the United States, Turkey, and China to customers, as well as
our own subsidiaries, and we are sensitive to our ability to recover these
shipping costs. If we cannot secure our container requirements or offset
additional shipping costs with price increases to customers, our profitability
could be impacted. We are also subject to other shipping risks. In particular,
rail service interruptions have affected our ability to ship, and the
availability of rail service, and our ability to recover increased rail costs,
may be beyond our control. In addition, governmental restrictions can, and
during the COVID-19 pandemic did, affect our ability to ship our products.
Operational Risks
The Company’s subsidiaries, BMI Oldco Inc. (f/k/a Barretts Minerals Inc.) (“Oldco”) and Barretts Ventures Texas LLC (together with Oldco, the “Chapter 11 Debtors”), have filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code to address and comprehensively resolve Oldco’s liabilities associated with talc. Risks and uncertainties related to this filing could have a material adverse effect on the Company’s business, financial condition, results of operations, and cash flows.
The Company and certain of the Company’s
subsidiaries are among numerous defendants in over one thousand cases seeking
damages for alleged exposure to asbestos-contaminated talc products sold by the
Company’s subsidiary Oldco. On October 2, 2023 (the “Petition Date”),
notwithstanding the Company’s confidence in the safety of Oldco’s talc
products, the Chapter 11 Debtors filed voluntary petitions for relief under
Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court
for the Southern District of Texas (the “Chapter 11 Cases”) to address and
comprehensively resolve Oldco’s liabilities associated with
talc. Minerals Technologies Inc. and the Company’s other
subsidiaries were not included in the Chapter 11 filing.
The
Chapter 11 Debtors’ stated goal in the Chapter 11 Cases is to confirm a plan
of reorganization under Section 524(g) of the U.S. Bankruptcy Code and utilize
this provision of the Bankruptcy Code to establish a trust that will address
all current and future talc-related claims. On June 29, 2026, to satisfy a
deadline imposed by the Bankruptcy Court, the Company filed a Plan of
Reorganization in the Chapter 11 Cases (the “Parent Plan”). The Parent Plan
would provide for, among other things:
● The funding of a Talc Personal Injury Trust
with $450 million from the Company for the payment of current and future
talc-related claims;
● Issuance of a channeling injunction pursuant
to section 524(g) of the Bankruptcy Code to address all current and future
talc-related claims through the Trust;
● Release of estate claims against the Company;
and
● The Company’s waiver of more than $100
million in claims against the Chapter 11 Debtors related to pre-petition and
post-petition funding.
On May 14, 2025, the Bankruptcy Court entered a
Report and Recommendation (i) recommending that the District Court determine
whether any of the talc sold by Oldco contained sufficient quantity and form of
asbestos to cause mesothelioma or other asbestos-related diseases and (ii)
abating the Chapter 11 Cases pending a determination by the District Court. On
June 22, 2026, the District Court adopted the Bankruptcy Court’s
recommendation. On September 22, 2026,
the Committee filed a petition for a writ of mandamus asking the U.S. Court of
Appeals for the Fifth Circuit to direct the District Court to vacate the order
adopting the Bankruptcy Court's recommendation. On October 2, 2026, the U.S. Court of Appeals
for the Fifth Circuit stayed the District Court proceedings and agreed to hear
oral argument on December 1, 2026 regarding the Committee’s mandamus
petition. The Company supports the path
forward recommended by the Bankruptcy Court in its May 14, 2025 Report and
Recommendation. The Parent Plan is
subject in all respects to the resolution of the District Court proceedings,
which are currently stayed pending resolution of the Committee’s mandamus
petition. The Bankruptcy Court proceedings also remain abated
In the second quarter of 2024, Oldco sold its
talc assets under section 363 of the U.S. Bankruptcy Code. In addition, in the
second quarter of 2024, the Company entered into a Debtor-in-Possession Credit
Agreement with Oldco (the “DIP Credit Agreement”) and recorded a provision for
credit loss of $30 million for the maximum aggregate principal amount under
such DIP Credit Agreement. The Company amended
the DIP Credit Agreement to increase the maximum principal amount available
under the DIP Credit Agreement by $30 million in the second quarter of 2025 and another $2.6 million in the second quarter of 2026. Proceeds of the sale of
Oldco's talc assets and funds drawn by Oldco under the DIP Credit Agreement
have been and will be used to fund the Chapter 11 Cases.
In the first quarter of 2025, the Company
recorded a provision to establish an accrual of $215 million for estimated
costs to fund a trust to resolve all current and future talc-related claims as
well as fund the Chapter 11 Cases and related litigation costs (including the
aforementioned $30 million increase to the maximum principal amount of the DIP
Credit Agreement). Concurrent
with the filing of the Parent Plan, the Company recorded a charge of $290
million in the second quarter of 2026 to increase the Company’s reserve for
estimated costs. The parties have not yet reached a final
resolution of all matters in the Chapter 11 Cases, and the Company is unable to
estimate the possible loss or range of loss beyond the amount accrued.
During the pendency of the Chapter 11 Cases, the
Company anticipates that the Chapter 11 Debtors will benefit from the operation
of the automatic stay, which stays ongoing litigation in connection with
talc-related claims against the Chapter 11 Debtors. In addition, the Bankruptcy
Court temporarily enjoined the filing or continued prosecution of all
talc-related claims against the Chapter 11 Debtors’ non-debtor affiliates,
subject to certain exceptions. Such exceptions consist of claims premised
solely on alleged inadequacies in testing of talc sold by Oldco. The
Company is vigorously opposing and defending against these claims. The
Chapter 11 Debtors have been deconsolidated from the Company’s financial
statements since the Petition Date.
Although the Chapter 11 Cases are progressing,
it is not possible at this time to predict how the U.S. Court of Appeals for the Fifth Circuit and the District Court will rule on
the matters before it, the form of any ultimate resolution, or when an ultimate
resolution might occur. Accordingly, the Company is unable to estimate the
possible loss or range of loss related to the amount that will be necessary to
fully and finally resolve all of Oldco’s current and future talc-related claims
in connection with a confirmed Chapter 11 plan of reorganization beyond the
amount accrued. Several risks and uncertainties related to the Chapter 11 Cases
could have a material adverse effect on the Company’s business, financial
condition, results of operations, and cash flows, including the ultimate amount
necessary to be contributed to any trust established pursuant to Section 524(g)
of the U.S. Bankruptcy Code, the potential for the Company’s talc-related
exposure to extend beyond the Chapter 11 Debtors arising from claims by talc
plaintiffs relating to the Company’s liability for talc claims, corporate veil
piercing efforts or otherwise, any final resolution of the scope of the Pfizer
indemnity, the ongoing costs of the Chapter 11 Cases, which may require
additional funding from time to time, the cost and length of time necessary to
ultimately resolve the cases, either through settlement or as a result of
litigation arising in connection with the Chapter 11 Cases, and the possibility
that the Chapter 11 Debtors will be unsuccessful in attaining relief under
Chapter 11. Further, while the Company anticipates that the Chapter 11 Debtors
will benefit from the operation of the automatic stay during the Chapter 11
proceedings, depending on the ultimate outcome of any of these litigation
matters, the Company could in the future be required to pay significant amounts
as a result of settlements or judgments, potentially in excess of liabilities
accrued to date in respect of such matters. The resolution of, or recognition
of additional liabilities in connection with, pending or future litigation
could have a material adverse effect on the Company’s results of operations,
cash flows, and financial condition.
For a further discussion of the Chapter 11 Cases and Oldco's talc-related liabilities, see Note 12 to the Condensed Consolidated Financial Statements, included in this report.
The Company is subject to stringent regulation in the areas of environmental, health and safety, and tax, and may incur unanticipated costs or liabilities arising out of claims for various legal, environmental and tax matters or product stewardship issues that could materially harm the Company’s results of operations, cash flows and financial condition.
The Company’s operations are subject to
international, federal, state, and local governmental environmental, health and
safety, tax, and other laws and regulations. We have expended, and may be
required to expend in the future, substantial funds for compliance with such
laws and regulations. In addition, future events, such as changes to or
modifications of interpretations of existing laws and regulations, or
enforcement polices, or further investigation or evaluation of the potential
environmental impacts of operations or health hazards of certain products, may
affect our mining rights or give rise to additional compliance and other costs
that could have a material adverse effect on the Company. Further, certain
of our customers are subject to various federal and international laws and
regulations relating to environmental and health and safety matters, especially
customers of our Environmental & Infrastructure product line of our
Engineered Solutions segment, who are subject to drilling permits, waste-water
disposal, and other regulations. To the extent that these laws and regulations
affecting our customers change, demand for our products and services could also
change and thereby affect our financial results. Greenhouse gas emissions have
become the subject of an increasing amount of concern from state, national, and
international governments and agencies. These concerns have resulted in,
and may continue to result in, the enactment or adoption of climate-related
legislation and regulation that would restrict emissions of greenhouse gases in
areas in which we conduct business, result in additional compliance costs,
or have an adverse effect on our operations or demand for our products. Our
manufacturing processes for our products use a significant amount of energy
and, should energy prices increase as a result of such legislation or
regulation, we may not be able to pass these increased costs on to purchasers
of our products. We cannot predict if or when currently proposed or additional
laws and regulations regarding climate change or other environmental or health
and safety concerns will be enacted or adopted.
The Company is also subject to income tax laws
and regulations in the United States and various foreign jurisdictions.
Significant judgment is required in evaluating and estimating our provision and
accruals for these taxes. Our income tax liabilities are dependent upon the
location of earnings among these different jurisdictions. Our income tax
provision and income tax liabilities could be adversely affected by the
jurisdictional mix of earnings, changes in valuation of deferred tax assets and
liabilities, and changes in tax treaties, laws, and regulations.
The Company is currently a party in various
litigation matters and tax and environmental proceedings and faces risks
arising from various unasserted litigation matters, including product
liability, patent infringement, antitrust claims, and claims for third-party
property damage or personal injury stemming from alleged torts, including, as
discussed elsewhere in this Report, a number of cases seeking damages for
alleged exposure to asbestos-contaminated talc products sold by Oldco. Any
failure to appropriately manage safety, human health, product liability, and
environmental risks associated with the Company’s products and production
processes could adversely impact the Company’s employees and other
stakeholders, the Company’s reputation, and its results of operations, cash
flows, and financial condition. Public perception of the risks associated with
the Company’s products and production processes could impact product acceptance
and influence the regulatory environment in which the Company operates. Any unanticipated
liability arising out of a current matter or proceeding, or from the other
risks described above, could have a material adverse effect on the Company’s
results of operations, cash flows, and financial condition.
Production facilities are subject to operating risks and capacity limitations that may adversely affect the Company’s financial condition or results of operations.
The Company is dependent on the continued
operation of its production facilities. Our production facilities and the
transportation of our products and/or the raw materials used to manufacture our
products are subject to hazards associated with the manufacturing, handling,
storage, and transportation of chemical materials and products, including
mechanical failure, leaks, ruptures, explosions, fires, inclement weather and
natural disasters, transportation interruptions, and environmental risks. Such
operating problems may cause personal injury and/or loss of life, damage to or
destruction of property and equipment, environmental damage, unscheduled
downtime, and customer attrition. We maintain property, business interruption,
and casualty insurance but such insurance may not cover all risks associated
with the hazards of our business and is subject to limitations, including
deductibles and maximum liabilities covered. We may incur losses beyond the
limits, or outside the coverage, of our insurance policies. Production at our
facilities may also be affected by labor disputes, labor shortages, and
increased turnover, which could disrupt our operations, cause a decline in our
production, increase employee-related costs, and divert the attention of our
management. Production facilities are also subject to governmental requirements
that may affect our ability to operate. Further, from time to time, we may
experience capacity limitations in our manufacturing operations. In addition,
if we are unable to effectively forecast our customers’ demand, it could affect
our ability to successfully manage operating capacity limitations. These
hazards, limitations, labor, and employee issues, disruptions in supply, and
capacity constraints could adversely affect financial results.
Operating results for some of our businesses are seasonal.
Certain of our businesses are affected by
seasonal weather patterns. A majority of revenues from our energy services
business within the Environmental & Infrastructure product line of our
Engineered Solutions segment is derived from the Gulf of Mexico and surrounding
states, which are susceptible to hurricanes that typically occur June 1st
through November 30th.
Actual or threatened hurricanes can result in volatile demand for services
provided by our energy services business. Our other businesses within the
Environmental & Infrastructure product line are affected by weather
patterns which determine the feasibility of construction activities. Typically,
less construction activity occurs in winter months and thus this segment’s
revenues tend to be greatest in the second and third quarters when weather
patterns in our geographic markets are more conducive to construction
activities. Additionally, some of the businesses within the Specialty Additives
product line of our Consumer & Specialties segment are subject to similar
seasonal patterns.
Our operations have been and will continue to be subject to cyberattacks and other disruptions to our information systems that could have a material adverse impact on our business, consolidated results of operations, and consolidated financial condition.
Our operations are dependent on digital
technologies and services, including systems operated by third parties that
include embedded artificial intelligence (“AI”). We use these technologies for
activities important to our business, including managing and operating our
manufacturing facilities, communications within our company and with customers
and suppliers, processing transactions, maintaining accurate financial records
and other enterprise resource planning requirements, protecting confidential
information, complying with regulatory, financial reporting, and legal
requirements, and otherwise storing, processing, and transmitting our data.
Increased use of remote working arrangements has only increased our reliance on
these technologies and services. Our business has in the past and could in the
future be negatively affected by security incidents and systems disruptions.
These disruptions or incidents may be caused by cyberattacks and other cyber
incidents, network or power outages, software, equipment, or telecommunications
failures, the unintentional or malicious actions of employees or contractors,
an inability to appropriately update our systems, natural disasters, fires, or
other catastrophic events.
Cyberattacks and other cyber incidents are
occurring more frequently, and the techniques used to gain access to
information technology systems and data, disable or degrade service or sabotage
systems are constantly evolving, becoming more sophisticated in nature, and are
being carried out by groups and individuals with a wide range of expertise and
motives. Cyberattacks and cyber incidents may be difficult to detect for
periods of time and take many forms including cyber extortion, denial of
service, social engineering, introduction of viruses or malware (such as
ransomware), exploiting vulnerabilities in hardware, software, or other
infrastructure, hacking, website defacement, theft of passwords and other
credentials, unauthorized use of computing resources, and business email
compromise. Continued geopolitical instability has heightened the risk of
cyberattacks.
Like other global companies, our systems are
subject to recurring attempts by third parties to access information,
manipulate data, or disrupt our operations, and we have experienced cyber
incidents. If we do not allocate and effectively manage the resources necessary
to continue building and maintaining our information technology infrastructure,
or if we fail to timely identify or appropriately respond to cyberattacks or
other cyber incidents, our business has been and can continue to be adversely
affected by, among other things: interruption of our business operations; loss
of or damage to intellectual property, proprietary or confidential information,
or customer, supplier, or employee data; and increased costs required to
prevent, respond to, or mitigate cybersecurity attacks. Similar risks exist
with respect to our business partners and third-party providers that we rely
upon. We also are subject to the risk that the activities associated with our
business partners and third-party providers can adversely affect our business
even if the attack or breach does not directly impact our systems or
information. Our use of AI software may create additional risks related to
the unintentional disclosure of proprietary, confidential, or otherwise
sensitive information.
Although the cyber incidents that we have
experienced to date have not had a material effect on our business, such
incidents or disruptions could have a material adverse effect on us in the
future. While we believe we devote significant resources to network security,
disaster recovery, employee training, and other measures to secure our
information technology systems and prevent unauthorized access to or loss of
data, there can be no guarantee that they will be adequate to safeguard against
all cyber incidents, systems disruptions, or misuses of data. In addition,
while we currently maintain insurance coverage that is intended to address
costs associated with certain aspects of cyber incidents and information
systems failures, this insurance coverage may not cover all losses or all types
of claims that arise from an incident, or the damage to our reputation or
brands that may result from an incident.