Ingevity Corporation (NGVT) Q3 2026 Earnings Call Transcript

Operator: Hello, everyone. Thank you for joining us. And welcome to the Ingevity third quarter 2026 earnings call and webcast. After today's prepared remarks, we will host a question-and-answer session. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. I will now hand the conference over to Mickey Walsh, head of investor relations. Please go ahead.

Michael H. Walsh: Thank you, and good morning. Welcome again to Ingevity's third quarter 26 earnings call. Last evening, we posted a presentation on our investor site that you can use to follow today's discussion. It may be found on our website ir.ingevity.com under events and presentations. Throughout this call, we may refer to non GAAP financial measures which are intended to supplement, not substitute for, comparable GAAP measures. Definitions of these measures and reconciliations to comparable GAAP measures are included in our earnings materials. We may also make forward-looking statements regarding future events and the company's future financial performance. Actual results or events may differ materially from those projections. Please refer to the forward looking statements and risk factors described in our earnings release and SEC filings. The agenda for today's call is listed on slide 3. Today, you will hear from David H. Li, our CEO and President, and Phillip John Platt, our CFO. Our prepared comments will focus on third quarter results and recent business highlights. Following the prepared remarks, we will take questions related to the quarter during the Q&A session. With that, I would now like to turn the call over to David.

David H. Li: Thank you, Mickey, and good morning, everyone. Please turn to slide 4. Our third quarter performance demonstrates the resilience of our business and the progress we are making across Ingevity. We delivered strong margins and cash generation while advancing the strategic priorities that are building a more focused, higher performing, specialty materials company. Performance Materials delivered another strong quarter supported by North American automotive demand amid the ongoing shift toward hybrid vehicles. Along with growth in filtration. Advanced polymer technologies improved profitability through a more favorable product mix, And in pavement technologies, higher asphalt costs resulted in softer demand and elevated input and operating costs. Another highlight this quarter was the continued momentum in our organic growth efforts particularly in filtration, where we are seeing continued tangible progress towards building a scalable platform. In water treatment, we continue to receive strong interest from customers seeking effective solutions for PFAS removal. Last quarter, we announced our first commercial win, And since then, we have secured several more contracts. Activity in this area continues to accelerate as more municipalities look to address their PFAS levels ahead of required reporting in early 2027, and we believe our materials will play an important role in solving this critical water challenge. Another example of our progress in filtration is in biogas purification, where commercial adoption and project activity continues to accelerate in 2026. Our differentiated solutions are helping renewable natural gas producers remove contaminants and improve production output. Creating tangible value for customers. We have seen our business grow rapidly and are excited about our participation in this growing renewable energy sector. What encourages me is not any win, but the progression we are seeing. From technical validation to commercial adoption and, increasingly, opportunities to replicate these successes across customers, and markets. We still have work ahead to build scale, and improve the economics of this business. But each new application customer win and successful deployment strengthens our confidence that filtration can become a meaningful, and profitable contributor to Ingevity's long term growth. We continue to advance the sale of advanced polymer technologies with the focus on achieving the best outcome for shareholders. Based on our latest information, the timing for an announced transaction may extend into early 2027, although we remain hopeful to announce something before year end. Our capital allocation strategy remains disciplined, and balanced. We repurchased $39 million of shares in the quarter, bringing year to date repurchases to $125 million and keeping us on track for our commitment of at least $300 million by the end of 2027. Our strong execution through the first 9 months supports a tighter full year adjusted EBITDA outlook with the midpoint unchanged at $390 million. With that, I will turn the call over to Phillip for a more detailed review of our financial results.

Phillip John Platt: Thank you, David, and good morning, everyone. Please turn to slide 5. Third quarter sales were $305 million, down 8% on a reported basis, primarily reflecting the divestiture of the Roadmarkings product line in April. Excluding road markings, sales increased 2% The sales increase was driven by higher pricing and favorable mix across the portfolio. Partially offset by lower volumes in performance materials and pavement technologies. Adjusted EBITDA from continuing operations was $108 million down 2% from the prior year. Adjusted EBITDA margin expanded 230 basis points to 35.4% as favorable pricing product mix, and operational execution more than offset higher input and logistics costs primarily in pavement technologies and advanced polymer technologies. Adjusted earnings per share was $1.63 compared to $1.31 in the prior year quarter. An increase of 24%. Turning to slide 6. These charts highlight our continued focus on cash generation, balance sheet strength, and disciplined capital allocation. Free cash flow for the quarter was approximately $86 million, down $32 million from the prior year. With approximately $21 million of the decline reflecting working capital benefits from divested operations in the prior year period. Additionally, CapEx of $14 million was approximately $2 million higher than the prior year. We repurchased approximately $39 million of shares during the quarter, bringing year to date repurchases to approximately $125 million with $172 million of capacity remaining on our current authorization. We are on pace to meet our $300 million share repurchase commitment by 2027. While maintaining net leverage within our long term target range of 2 to 2.5x. Now let's turn to segment results. Beginning with performance materials, on slide 7. Performance Materials delivered another strong quarter, with stable sales and EBITDA. Despite a mixed automotive demand environment across regions. Sales were approximately $154 million, nearly flat with the prior year. As strength in North American automotive demand and growth in filtration were offset by softer automotive demand in China and Europe. North America automotive demand continued to benefit from the shift in consumer preference towards hybrid vehicles. Segment EBITDA was approximately $83 million nearly flat with the prior year. EBITDA benefited from pricing actions in automotive applications improved nonauto filtration profitability, and stronger manufacturing performance offset by lower volumes and higher SG&A associated with investments to support future growth. Segment EBITDA margin remained strong at 54.1%, Looking to the fourth quarter, we expect results to moderate sequentially due to the normal seasonal reduction in North America auto production and planned maintenance activities. Let's turn to slide 8. Pavement Technologies segment sales were $106 million down 24%. Primarily due to the divestiture of road markings in April. Excluding road markings, sales were nearly flat as higher pricing offset softer demand. Persistently higher asphalt costs driven by crude oil inflation continued to increase project costs for our customers. Pressuring demand and limiting our sales growth. Segment EBITDA was $19.6 million, down $7.3 million from the prior year. The EBITDA decline reflected lower volumes and the retention of dyssynergy costs largely due to the divestiture of road markings. As well as higher input and logistics costs. As we enter the fourth quarter, we expect normal seasonal demand moderation. Added pressure from higher asphalt costs, and continued input cost pressure. Heading into 2027, we expect higher asphalt costs to persist and pressure infrastructure budgets. Causing customers to prioritize maintenance over new road construction slowing our efforts of warm mix asphalt expansion. We believe these conditions are likely to affect pavement technologies near term growth rate before the longer term adoption opportunity resumes. In the interim, we are keenly focused on improving performance through a combination of pricing actions, operational and cost optimization projects, and continuing new product innovation. As we head into 2027, Let's turn to slide 9. Advanced polymer technologies continue to deliver improved year over year results. Sales increased 18% to $45 million. Driven by higher pricing, including a price surcharge and favorable mix towards higher value derivative products. Segment EBITDA increased to approximately $12 million from $11 million in the prior year. As favorable product mix and higher pricing partially offset higher input costs. EBITDA margin declined 280 basis points to 26%. Primarily reflecting pricing surcharges that helped offset higher input costs. But carried little to no incremental margin. For the fourth quarter, we expect typical softer demand and higher input costs to pressure results. And with that, I will turn the call back to David to discuss our updated outlook.

David H. Li: Thanks, Phillip. Turning to slide 10. With 3 quarters of the year behind us, we are narrowing our full year adjusted EBITDA outlook to $385 million to $395 million maintaining the $390 million midpoint of our prior range. This reflects solid year to date execution and our expectations for our typical lower fourth quarter results. We also expect full year net sales of approximately $1.1 billion and diluted adjusted earnings per share of $5.25 to $5.45 Lastly, we expect free cash flow of $220 million to $230 million which reflects increased capital expenditures and working capital investments heading into 2027. Looking ahead, we see an increasingly compelling set of organic growth opportunities across our differentiated technology platforms. Filtration including municipal water treatment and biogas purification, is gaining momentum. Warm mix adoption continues in Pavetec, and energy storage adds an additional future pathway for growth. Ingevity is becoming a stronger, more focused company with resilient margins strong cash generation, differentiated technologies, and multiple paths to organic growth. We are allocating capital with discipline and remain confident in our ability to deliver sustainable, long term, shareholder value. With that, I will turn the call over for questions.

Operator: We will now begin the question-and-answer session. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. We ask that you pick up your handset when asking to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Your first question comes from the line of Daniel Rizzo with Jefferies. Your line is now open. Please go ahead.

Daniel Rizzo: Hey. Thanks, guys. So to start with, so hybrid in North America is obviously still a tailwind, offsetting some other weakness in auto elsewhere. But I was wondering when that tailwind from hybrids just start to wane and when we are going to have to kind of move back towards or depend more on just increased auto production in the region.

David H. Li: Yes. Thanks, Daniel. Good morning. Yeah. Your question is a good 1. What we see is, the hybrid transition is still very much playing out, especially in the North American market. So we think that has room to run. You are right that the underlying auto production environment is pretty muted. So we have not assumed any, you know, significant recovery. If you look at folks that forecast the industry like S and P, they are calling for flattish to slightly down but we think we are going to be continued beneficiaries of this hybrid transition. And I. I would say it is still probably early to mid innings, of the transition.

Daniel Rizzo: And then with the opportunity from the--from the PFAS and water and the filtration, I mean, it--it is starting to kind of gain a little bit of steam. Does that mean. Well, that is great for EBITDA dollars, Does that mean EBITDA margins within that segment should start to be impacted next year just because of the mix headwind.

David H. Li: Yeah. I will let Phillip address the EBITDA contribution, but you know, in general, for filtration, we are really encouraged I think this is the result of being a more focused company where we can really spend some time and resources and effort trying to grow into this newer area. And what we wanted to talk about this call was the progress we continue to make in areas like PFAS where we have secured several more contracts. But also in areas like biogas where our activated carbon is helping the landfills purify the natural gas before they put it in the pipeline, and that business is also growing very rapidly. So we have been pleased with the progress we are making in filtration. And I think it is it is obviously early in the journey. But seeing a lot of good progress and some commercial wins.

Phillip John Platt: Yeah. Hey. Good morning, Daniel. I will just I will just add to David's comment a little bit. Well, what we have said is we are we are upgrading that volume. So in the near term, we do not expect any significant volume shift into the filtration. Market. We are just simply upgrading it So we do not really expect significant margin compression. I think looking at 2027, there is clearly a bunch of puts and takes. And, although we are not providing guidance, what I would say is we do have numbers out there. From the December 2025 iDay that we did. And I would say largely for performance materials, we expect that business in 2027 to deliver within the ranges that we provided back in December 2025 to give you a sense of what we expect.

Daniel Rizzo: Alright. Thank you very much.

Operator: Your next question comes from the line of John Tanwanteng with CJS Securities. Your line is now open. Please go ahead.

Jonathan Tanwanteng: Hi. Good morning, and thank you for taking my questions. I was wondering if you could talk a little bit more about the APT sale process. If there is any sticking points in discussion with the potential buyers and how much the underlying strength of the business is contributing to that discussion, if at all.

David H. Li: Yeah. Thanks, John. So on APT, we just wanted to provide some more color in the process. We have narrowed the field down to several interested parties, and obviously the business continues to perform well. And as we have mentioned, our focus has been really to drive the best outcome for shareholders. So, you know, we are not trying to hold to a calendar date. We are just trying to get the best outcome for the business. And it is performing well. So what we wanted just to call out is that the process may go into 2027. We are still hopeful that we can announce something before the end of the year. But we just wanted to be transparent that it is taking a little longer than we initially thought. There are several interested parties engaged but I think the most important part is we wanted to remain disciplined. And focused on driving the best outcome.

Jonathan Tanwanteng: Got it. Thanks, David. And then, just a question on the payment business. I think you mentioned that it is probably going to be pressured into next year. 1, do you think your customers are moving to substitutes away from asphalt, or they are just delaying their purchases until they can get better pricing or maybe the budgets for it. that is the first question. And then the second question is, what do you think the degree of pressure might be? Do you think it might impact your ability to hit the 2027 target?

David H. Li: Yeah. I will let Phillip talk to the numbers, but I think the most important part is that although we see some near term headwinds, on the higher cost inputs and I think some projects have been slowed down, 1 is we are taking some corrective measures in terms of pricing. And as well as we have some new products that we are introducing into the market that should help in that area. I think the most important part is you know, really the structural growth drivers of the business remain very much intact. So the compelling value driver of, you know, switching from hot mix to warm mix with our Evotherm that continues to be very compelling for our customers. And I believe the business grew a bit even in this difficult environment, so it would have performed even more strongly if we had not had those headwinds. I do think we are still on track for our 2027 commitments. it is not guidance. It was just part of that December, Investor Day. But I think most importantly is you know, the growth drivers of the business are still very much intact and compelling.

Phillip John Platt: Yeah. And just as a reminder, you know, what we saw this year, in terms of asphalt costs that our customers are bearing is, in some regions within the United States, asphalt costs have gone up about 50%. Since the beginning of the year. And so to give you a sense of scale, a 50% increase in asphalt costs can drive about a 20% increase in the actual cost of the road. So what we have seen. We started to see it in the back end of Q2 and clearly have seen it in Q3. Is our customers are being very resourceful in how they are utilizing their finite budgets. They are spending more money on road preservation and maintenance. As opposed to actually paving roads. So what we said in December 2025 is we expect that business to put up mid single digit growth primarily driven by growth in warm mix asphalt as we convert hot mix to warm mix Clearly, if expectations prevail we expect asphalt costs to continue to persist at these high levels into 2027. We would expect without a significant shift in customer budgets DOT budgets, they would continue to prioritize maintenance spend. In 2027 essentially reducing tonnage So the amount of actual asphalt being put down on the road, which will hinder our ability to grow at mid single digits for warm mix. But as David said, that is a near term headwind. We expect, you know, the growth to reside, you know, as either budgets accommodate higher costs of asphalt or we get a tailwind from a drop in crude oil pricing?

Jonathan Tanwanteng: Okay. Great. Thank you for that color. I will jump back in queue.

Operator: Your next question comes from the line of John McNulty with BMO Capital Markets. Your line is now open. Please go ahead.

John McNulty: Yeah. Yeah. Thanks for taking my question. Maybe just a little bit more on pavement tech side. I believe about half of that business, give or take, is on pavement preservation side. So guess when you talk to 2027 potentially being a bit soft because of the Evotherm side. Is there a chance that we see the customer base shift to your pavement preservation side? And have you put that into kind of your expectations for 2027 at this point?

Phillip John Platt: Yeah. Hey. Good morning, John. I will take this and then hand it over to David. Yeah. Clearly, what we saw in Q3, and we expect this continue as we turn the calendar year, is a higher sales in preservation and maintenance spend. Than in road construction and warm mix spend. that is what we saw in Q3, and we expect that to persist as we get into 2027 and just. You mentioned about half about 2 thirds of the business is pavement preservation slash maintenance emulsifiers, and 1-third is the warm mix. Side of the business just as heads up.

David H. Li: Yeah. I would just add, obviously, we are getting to the end of the paving season now. And as we end the year and go into next year, you know, you will see budgets being reset. We are also taking some pricing and productivity efforts to sort of offset those headwinds too. So that should set us well, set us up well for 2027. As the paving season restarts.

John McNulty: Okay. Got it. Okay. that is helpful. And then on the filtration side, in PM, I guess, am I understanding your commentary right that it sounds like you have not really seen a big increase in volumes, but what you have seen is you have converted those volumes from essentially no margin business to positive margin business. And I guess if that is the case, when do you think we actually start to see the volumes for that. For the non auto side actually start to grow? Do we see that in 2027 based on some of these new contracts, or is right now more of just, hey, we have got to convert it into more profitable business, we will worry about the volumes in the future.

David H. Li: Yeah. I think you have it right, John, in terms of we are trying to up the existing volume we were selling as we talked about 20% or more of our volume into filtration at pretty negligible EBITDA. The team has done a really great job focusing on you know, higher value opportunities like PFAS and like biogas. And we have won commercial, we have had some commercial wins and success in that area. So it is about upgrading that volume first and foremost I think we are on track with what we talked about back in Investor Day in terms of the contribution and growth in EBITDA we will start to see that. We already saw some of that this year, and we will see that I think accelerate into 2027. So I would say we are on track there. And we are very encouraged by the commercial wins we have been able to secure.

John McNulty: Got it. Can you give us maybe a little bit of an update as to what portion of that 20% that was, you know, not profitable, how much of that you have kind of upgraded already just so we can get a feel for kind of where you are in that process?

Phillip John Platt: Well, we put some numbers out there back in December, I would say we are delivering against those numbers. Contribution for the up upgrade this quarter, I would say, was about 15%. So it is meaningful year over year when we think about filtration, obviously, in the context of the segment, which is dominated by our EVAP business. it is small, but it is it is meaningful for us as we think about executing the strategy. And we are clearly seeing the strategy take hold.

David H. Li: Yeah. I think we are hitting it at a good time. Because as we all know, you know, the PFAS water challenge and all the reporting requirements, they are really coming into play right now and into 2027. And so we have secured we continue to secure contracts with municipalities We are selling volume of our powdered activated carbon pack into PFAS. And so we think it is kind of hitting that filtration space with a pretty differentiated solution at the right time.

John McNulty: Got it. Thanks for the call. Appreciate it.

Operator: Your next question comes from the line of Peter Gustreich with Water Tower Research. Your line is now open. Please go ahead.

Analyst: Thank you. So good morning, David, and congrats on the results and, to see the strong momentum continuing with the share repurchases. And also for taking my questions. I would be curious to hear, you know, following this week's midterm elections, your view about, the policy environment for your end markets, you know, thinking from the perspective of things like federal highway funding, the EPA's approach to PFAS enforcement, and other items. Thank you.

David H. Li: Yeah. Thanks, Peter. So first, I would say you know, I think our business model has proven to be very resilient and durable over a number of different economic environments and administration. So we feel really good about our positioning. In my opinion, the was sort of a referendum on the economy and affordability. So to the extent that there is any improvement in areas, whether it is oil price, as we have talked about, as potential headwind for pay pavement or just general inflation. And if. To the extent that any of that improves, I think that is positive for consumer sentiment and would be a positive for our business. And I think on the other side of it, there is a lot of really, exciting areas that we participate in that are, I think, definitely, so, you know, things like filtration, clean water, infrastructure, all those things, I think, are pretty bipartisan focused areas. So I think we are really well positioned and I think we have been able to perform in a in a variety of different environments. So we are confident. Okay. Thank you. And my next question is about the regional differences in the margins. So, Performance Materials North America held up well this quarter, while China and Europe softened. Can you talk about what is driving those differences in the regional margins? And how should we think about those regions evolving into next year? Yeah. Maybe I will start and turn it over to Phillip. You know, obviously, as you mentioned, North America is the large majority of our Performance Materials Business For Auto, Whether it is made in the US or made for sale in The US, that is, I would say, over 70% of our business. If you think about China, the auto is evolving a little differently. Obviously, they are probably the country that is moving to electrification, the fastest. The data is pretty clear there, but it is obviously not a blueprint for the rest of the world. So for example, in The US, again, where we have the majority of our business, you. We have seen this revival of ICE next generation ICE engines, next generation hybrid engines. We are working closely with customers on those solutions. And so I think although China mark the China market is moving a bit faster than others, I think The US market remains a really, really strong area for us, and, obviously, that is where the majority of our business is. Phillip, what would you add?

Phillip John Platt: Yeah. that is. What I would add to that is that the regulatory landscape. So interestingly enough, The US is actually the most stringent landscape as far as evaporative emissions for automotive applications. So what does that mean? That means it requires not only higher volume of content of material, but also our highest dollar value, most technologically advanced carbon. And so the tailwind is nice in The United States when the consumer is preferring to purchase hybrids and ICE vehicles over BEVs. When you think about China, and Europe, they are what we call a Tier 2 requirement. So it is a step down. it is what the US used to require, you know, around the early 2 thousands. So less dollar value of content, less technologically advanced, carbon as well. So less margin You know, in China, about 20% of our sales are in China. Largely, as David said, you know, upwards of 70% of our PM sales are in North America. Okay. Thank you. that is very helpful. And we are getting toward the, you know, the end of the year. Are you able to share sort of you know, what the, you know, what your pricing discussions are looking like, how they are shaping up for 2027 in Performance Materials? Yeah. Well, we are not gonna give guidance on 2027, but what I will say, and I think I would covered this a couple times in the call, but just for clarity purposes, you know, when we think about the macro for 2027, on the vehicles that are carbon participates on. Globally expect flat auto production 2027 to 2026. We do expect to that. That we do expect to continue to benefit from the mix shift here in The United States to focus on more hybrids than ICE so that they that would be a tailwind for us. And as I said, you know, we have numbers out there that would we came out within, during our investor day back in December 2025. And we expect the Performance Materials business to perform within the numbers that we provided.

David H. Li: David, anything else? No. And I would say from a pricing perspective, perspective, we have traditionally done price increases annually in the first quarter. I consider that practice continue on as we you know, upgrade the portfolio, and it is just a demonstration of the value that we are providing the customers. So no change to that, expectation.

Analyst: Okay. Great. Yeah. All very clear. Thanks for taking my questions, and I will get back in the queue.

Operator: Your next question comes from the line of John Tanwanteng with CJS Securities. Your line is now open. Please go ahead.

Jonathan Tanwanteng: Hi. Yeah. I was just wondering if could give a little bit more color on the 2027 mix in carbon between volume and pricing and the mix of hybrids I think I understand that, you know, you are you are you are still broadly in line with the targets you have, but I am wondering if volume continues to decline as, you know, hybrids use less carbon pricing goes up both from the pricing that you are pushing through and the mix as you get higher ASP on the carbon from hybrid cars. If you could just break those down a little further, that would be helpful.

David H. Li: Thanks. Yeah. I would say just broad strokes you have the right kind of major factors. So if you assume auto production is flat to slightly down, you know, so pretty muted in the overall auto production area. Within auto production, in North America, especially, we are gonna continue to see that hybrid transition, and we are gonna benefit there by selling our most advanced, activated carbon solutions. So a honeycomb into many of those vehicles. So that should be a positive from a mix perspective. As you mentioned, it is not necessarily more volume, but more profitable for us. And then some of the other smaller regions, including China, you see that electrification trend continue. So I think overall it sets up well for us, especially with the hybrid transition And then we have in the backdrop the growing filtration business, which I think is upgrading the profitability of the business even if it is at 54% EBITDA, we could see some continued uplift to that as filtration continues to improve the profitability.

Jonathan Tanwanteng: Okay. Great. Can you give us an update on the battery business for carbon materials and how that. that is progressing?

David H. Li: Yeah. So we have got several efforts in that area. First, we have invested in a company called Nexion for silicon anode technology. Then we also have a license to. In a partnership with a company called Chasm for carbon nanotubes And then third, we have our own organic efforts in things like, hard carbon I would say there is been progress in all of those, but as we mentioned in our investor day, we do not have those in our 2027 numbers. I think things continue to progress. it is obviously a very dynamic space. And we are pleased with the progress, but it is not reflected in the financials. I think it is a farther out investment that we are we are thinking about in terms of returns.

Jonathan Tanwanteng: Okay. Great. And then finally, is there any update on China moving to the highest level of emissions control we get to the end of the decade.

David H. Li: Yeah. I think you are referring to China 7. So then China moving to a more stringent emission standard, and, obviously, we would benefit to the extent they have more stricter emission standards similar to what we have seen in The US. You know, expectations continue to be that will be at the end of this decade, and rolled out there and obviously see some inventory build up ahead of that announcement.

Jonathan Tanwanteng: Would that be a 2029 or 2030 event? that is at this stage?

David H. Li: I do not know. Our teams are working very close with those regulatory bodies, but they have not come out with a definitive year yet, but it will be in that time frame.

Jonathan Tanwanteng: Okay. Great. We will stay tuned. Thank you.

Operator: There are no further questions at this time. I will now turn the call back to David H. Li for closing remarks.

David H. Li: Thank you again for joining us today. First, our businesses continue to demonstrate resilient margins and strong cash generation despite a mixed demand environment. Second, our portfolio transformation continues to advance we remain focused on achieving the best outcome in the sale of advanced polymer technologies. Third, we are translating our differentiated technologies into tangible growth opportunities particularly in filtration and warm mix asphalt with additional future potential growth in energy storage. And fourth, disciplined capital allocation remains a priority. Net leverage is within our long term target range, and share repurchases remain ahead of our targeted pace. Finally, we remain focused on delivering on our 2027 strategic commitments. We are building a more focused Ingevity with durable earnings power differentiated technologies, and the financial flexibility to create long term value for shareholders. Thank you for your continued interest in Ingevity, and we look forward to updating you on our progress.

Operator: This concludes today's call. Thank you for attending. You may now disconnect.