0000095953false00000959532024-11-122024-11-12

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549

FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): November 12, 2024
Ascent Logo.jpg
Ascent Industries Co.
(Exact name of registrant as specified in its charter)
Delaware0-1968757-0426694
(State or other jurisdiction of incorporation or organization)(Commission File Number)(I.R.S. Employer Identification No.)
20 N. Martingale Rd,Suite 430,
Schaumburg,Illinois60173
(Address of principal executive offices)(Zip Code)
(630)884-9181
(Registrant's telephone number, including area code)
Inapplicable
(Former name or former address if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of exchange on which registered
Common Stock, par value $1.00 per shareACNTNASDAQ Global Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2 of this chapter).

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. ¨



Item 2.02.     Results of Operations and Financial Condition
On November 12, 2024, Ascent Industries Co. ("the Company") issued a press release announcing financial information for its third quarter ended September 30, 2024. The press release is attached as Exhibit 99.1 to this Form 8-K and is furnished to, but not filed with, the Commission.
Item 9.01.    Financial Statements and Exhibits
(d) Exhibits
Exhibit NumberDescription of Exhibit
104Cover Page Interactive Data File (embedded within the Inline XBRL document)




SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on behalf by the undersigned hereunto duly authorized.
Ascent Industries Co.
Dated: November 12, 2024By: /s/ Ryan Kavalauskas
Ryan Kavalauskas
Chief Financial Officer


Exhibit 99.1

ascentlogo.jpg

Ascent Industries Reports Third Quarter 2024 Results
Schaumburg, Illinois, November 12, 2024 – Ascent Industries Co. (Nasdaq: ACNT) (“Ascent” or the “Company”), an industrials company focused on the production of specialty chemicals and industrial tubular products, is reporting its results for the third quarter ended September 30, 2024.

Third Quarter 2024 Summary1
(in millions, except per share and margin)Q3 2024Q3 2023Change
Net Sales$42.9$46.7(8.2)%
Gross Profit$6.5$3.0116.5%
Gross Profit Margin15.1%6.4%870bps
Net Loss $(7.0)$(14.7)(52.2)%
Diluted Loss per Share$(0.69)$(1.45)(52.4)%
Adjusted EBITDA$2.5$(1.5)262.8%
Adjusted EBITDA Margin5.7%(3.2)%890bps
________________
1On December 22, 2023, the Company closed on a transaction to sell substantially all of the assets of Specialty Pipe & Tube (“SPT”). As a result, financial results from SPT have been categorized into discontinued operations.

Management Commentary
“The third quarter marked another period of positive momentum as we generated our third straight quarter of improving results,” said Ascent CEO Bryan Kitchen. “Although market conditions remained soft across both segments, we continued to strip out unnecessary costs and operate more efficiently through aggressive self-help initiatives, leading to both year-over-year and quarter-over-quarter improvements to our bottom line. We also made notable progress on the business development front within our specialty chemicals segment, which we believe will begin to show revenue growth in 2025 as we remain committed to unlocking the full potential of this segment.

“Overall, we are creating a more predictable, reliable, and profitable operating model, as evidenced by our consistently improving results over the last three quarters. While demand across our end markets isn’t doing us any favors, I’m proud of what we’ve been able to accomplish so far this year in our efforts to stabilize the organization through recapitalizing SG&A, strict cost management, product line optimization, and dynamic pricing adjustments. These actions combined with our healthy balance sheet and no outstanding debt have us well positioned to finish the year on a positive note and move into 2025 with momentum at our back.”

Third Quarter 2024 Financial Results
Net sales from continuing operations were $42.9 million compared to $46.7 million in the third quarter of 2023. The decline was primarily driven by lower volumes and lower pricing as the Company fulfilled low-priced order backlog within the tubular products segment, along with lower volumes in the specialty chemicals segment partially offset by favorable pricing and product mix.

Gross profit from continuing operations increased 117% to $6.5 million, or 15.1% of net sales, compared to $3.0 million, or 6.4% of net sales, in the third quarter of 2023. The increase was primarily attributable to aggressive cost management through improvements in product line management and strategic materials sourcing across both segments.

Net loss from continuing operations improved to $7.0 million, or $0.69 diluted loss per share, compared to a net loss from continuing operations of $14.7 million, or $1.45 diluted loss per share, in the third quarter of 2023. During the quarter, the Company recorded a $6.2 million non-cash, one-time tax charge related to a valuation allowance against the Company’s deferred tax assets. Income from continuing operations before taxes for the third quarter of 2024 was $0.5 million. The year-over-year
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improvement was primarily attributable to the aforementioned increase in gross profit as well as a year-over-year decrease in interest expense due to lower debt outstanding.

Adjusted EBITDA increased notably to $2.5 million compared to $(1.5) million in the third quarter of 2023, with adjusted EBITDA margin increasing significantly to 5.7% compared to (3.2)% in the prior year period. The improvement was primarily driven by the aforementioned cost and product mix optimization initiatives.

Segment Results
Ascent Chemicals – net sales in the third quarter of 2024 increased 4% to $20.9 million compared to $20.1 million in the third quarter of 2023. Operating income in the third quarter improved significantly to $0.4 million compared to an operating loss of $(11.5) million in the prior year period. Adjusted EBITDA in the third quarter increased 47% to $1.5 million compared to $1.0 million in the prior year period. As a percentage of segment net sales, adjusted EBITDA increased 210 basis points to 7.3% compared to 5.2% in the third quarter of 2023.

Ascent Tubular – net sales from continuing operations in the third quarter of 2024 were $22.0 million compared to $26.7 million in the third quarter of 2023. Operating income from continuing operations in the third quarter improved to $1.7 million compared to an operating loss from continuing operations of $(0.6) million in the prior year period. Adjusted EBITDA from continuing operations in the third quarter increased significantly to $2.4 million compared to $0.2 million in the prior year period. As a percentage of segment net sales, adjusted EBITDA increased significantly to 10.7% compared to 0.7% in the third quarter of 2023.

Liquidity
As of September 30, 2024, the Company had $8.5 million in cash and cash equivalents, no debt outstanding under its revolving credit facilities and had $57.5 million in availability under its revolving credit facility.

For the quarter ended September 30, 2024, the Company repurchased 42,623 shares at an average cost of $9.79 per share for approximately $0.4 million.

Conference Call
Ascent will conduct a conference call today at 5:00 p.m. Eastern time to discuss its results for the third quarter ended September 30, 2024.

Ascent management will host the conference call, followed by a question-and-answer period.

Date: Tuesday, November 12, 2024
Time: 5:00 p.m. Eastern time
Live Call Registration Link: Here
Webcast Registration Link: Here

To access the call by phone, please register via the live call registration link above or here and you will be provided with dial-in instructions and details. If you have any difficulty connecting with the conference call, please contact Gateway Group at 1-949-574-3860.

The conference call will also be broadcast live and available for replay via the webcast registration link above here. The webcast will be archived for one year in the investor relations section of the Company’s website at www.ascentco.com.

About Ascent Industries Co.
Ascent Industries Co. (Nasdaq: ACNT) is a company that engages in a number of diverse business activities including the production of specialty chemicals and industrial tubular products. For more information about Ascent, please visit its website at www.ascentco.com.

Forward-Looking Statements
This press release may include "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and other applicable federal securities laws. All statements that are not historical facts are forward-looking statements. Forward looking statements can be identified through the use of words such as "estimate," "project," "intend," "expect," "believe," "should," "anticipate," "hope," "optimistic," "plan," "outlook," "should," "could," "may" and similar expressions. The forward-looking statements are subject to certain risks and uncertainties which could cause actual results to differ materially from
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historical results or those anticipated. Readers are cautioned not to place undue reliance on these forward-looking statements and to review the risks as set forth in more detail in Ascent Industries Co.’s Securities and Exchange Commission filings, including our Annual Report on Form 10-K, which filings are available from the SEC or on our website. Ascent Industries Co. assumes no obligation to update any forward-looking information included in this release.

Non-GAAP Financial Information
Financial statement information included in this earnings release includes non-GAAP (Generally Accepted Accounting Principles) measures and should be read along with the accompanying tables which provide a reconciliation of non-GAAP measures to GAAP measures.
Adjusted EBITDA is a non-GAAP financial measure that the Company believes is useful to investors in evaluating its results to determine the value of a company. An item is excluded in the measure if its periodic value is inconsistent and sufficiently material that not identifying the item would render period comparability less meaningful to the reader or if including the item provides a clearer representation of normalized periodic earnings. The Company excludes in Adjusted EBITDA two categories of items: 1) Base EBITDA components, including: interest expense, income taxes, depreciation and amortization, and 2) Material transaction costs including: goodwill impairment, asset impairment, gain on lease modification, stock-based compensation, non-cash lease cost, acquisition costs and other fees, shelf registration costs, loss on extinguishment of debt, retention costs and restructuring & severance costs from net income.
Management believes that these non-GAAP measures are useful because they are key measures used by our management team to evaluate our operating performance, generate future operating plans and make strategic decisions as well as allow readers to compare the financial results between periods. Non-GAAP measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider the Company's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Non-GAAP measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the Company's results or financial condition as reported under GAAP.

Company Contact
Ryan Kavalauskas
Chief Financial Officer
1-630-884-9181

Investor Relations
Cody Slach and Cody Cree
Gateway Group, Inc.
1-949-574-3860
ACNT@gateway-grp.com




3
Ascent Industries Co.
Condensed Consolidated Balance Sheets
(in thousands, except par value and share data)
    
(Unaudited)
 September 30, 2024December 31, 2023
Assets 
Current assets: 
Cash and cash equivalents$8,547 $1,851 
Accounts receivable, net of allowance for credit losses of $583 and $463, respectively27,768 26,604 
Inventories42,968 52,306 
Prepaid expenses and other current assets3,483 4,879 
Assets held for sale— 2,912 
Current assets of discontinued operations56 861 
Total current assets82,822 89,413 
Property, plant and equipment, net26,654 29,755 
Right-of-use assets, operating leases, net28,623 27,784 
Intangible assets, net7,380 8,496 
Deferred income taxes— 5,808 
Deferred charges, net29 104 
Other non-current assets, net3,108 1,935 
Total assets$148,616 $163,295 
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable$12,286 $16,416 
Accrued expenses and other current liabilities7,081 5,108 
Current portion of note payable641 360 
Current portion of operating lease liabilities1,448 1,140 
Current portion of finance lease liabilities288 292 
Current liabilities of discontinued operations222 1,473 
Total current liabilities21,966 24,789 
Long-term portion of operating lease liabilities30,433 29,729 
Long-term portion of finance lease liabilities1,089 1,307 
Deferred income taxes369 — 
Other long-term liabilities54 60 
Total non-current liabilities31,945 31,096 
Total liabilities$53,911 $55,885 
Commitments and contingencies
Shareholders' equity:
Common stock, par value $1 per share; 24,000,000 shares authorized; 11,085,103 and 10,092,966 shares issued and outstanding, respectively$11,085 $11,085 
Capital in excess of par value47,238 47,333 
Retained earnings45,946 58,517 
 104,269 116,935 
Less: cost of common stock in treasury - 992,137 and 990,282 shares, respectively(9,564)(9,525)
Total shareholders' equity94,705 107,410 
Total liabilities and shareholders' equity$148,616 $163,295 
Note: The condensed consolidated balance sheets at December 31, 2023 have been derived from the audited consolidated financial statements at that date.
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Ascent Industries Co.
Condensed Consolidated Statements of Income (Loss) - Comparative Analysis (Unaudited)
($ in thousands, except per share data)
Three Months Ended
September 30,		Nine Months Ended
September 30,
2024202320242023
Net sales
Tubular Products$22,023 $26,695 $74,559 $86,748 
Specialty Chemicals20,878 20,052 62,642 65,165 
All Other— — — 50 
42,901 46,747 137,201 151,963 
Operating income (loss) from continuing operations
Tubular Products1,653 (620)1,040 (7,215)
Specialty Chemicals385 (11,481)(625)(10,935)
All Other(117)(132)(378)(684)
Corporate
Unallocated corporate expenses(1,490)(2,859)(5,070)(9,314)
Acquisition costs and other(2)— (53)(274)
Gain on lease modification67 — 67 — 
Total Corporate(1,425)(2,859)(5,056)(9,588)
Operating income (loss)496 (15,092)(5,019)(28,422)
Interest expense, net124 1,063 323 3,217 
Other, net(91)(97)(303)(344)
Income (loss) from continuing operations before income taxes463 (16,058)(5,039)(31,295)
Income tax expense (benefit)7,479 (1,380)6,270 (4,680)
Loss from continuing operations(7,016)(14,678)(11,309)(26,615)
Income (loss) from discontinued operations, net of tax864 (3,254)(1,262)(11,152)
Net loss$(6,152)$(17,932)$(12,571)$(37,767)
Net loss per common share from continuing operations
Basic$(0.69)$(1.45)$(1.12)$(2.62)
Diluted$(0.69)$(1.45)$(1.12)$(2.62)
Net income (loss) per common share from discontinued operations
Basic$0.08 $(0.32)$(0.12)$(1.10)
Diluted$0.08 $(0.32)$(0.12)$(1.10)
Net loss per common share
Basic$(0.61)$(1.77)$(1.24)$(3.72)
Diluted$(0.61)$(1.77)$(1.24)$(3.72)
Average shares outstanding
Basic10,114 10,135 10,111 10,151 
Diluted10,114 10,135 10,111 10,151 
Other data:
Adjusted EBITDA1
$2,450 $(1,505)$1,446 $(9,993)
1The term Adjusted EBITDA is a non-GAAP financial measure that the Company believes is useful to investors in evaluating its results to determine the value of a company. An item is excluded in the measure if its periodic value is inconsistent and sufficiently material that not identifying the item would render period comparability less meaningful to the reader or if including the item provides a clearer representation of normalized periodic earnings. The Company excludes in Adjusted EBITDA two categories of items: 1) Base EBITDA components, including: interest expense, income taxes, depreciation and amortization, and 2) Material transaction costs including: goodwill impairment, asset impairment, gain on lease modification, stock-based compensation, non-cash lease cost, acquisition costs and other fees, retention costs and restructuring & severance costs from net income. For a reconciliation of this non-GAAP measure to the most comparable GAAP equivalent, refer to the Reconciliation of Net Income (Loss) to Adjusted EBITDA.
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Ascent Industries Co.
Consolidated Statements of Cash Flows (Unaudited)
($ in thousands)
Nine Months Ended September 30,
20242023
Operating activities  
Net loss$(12,571)$(37,767)
Loss from discontinued operations, net of tax(1,262)(11,152)
Net loss from continuing operations(11,309)(26,615)
Adjustments to reconcile net loss to net cash provided by operating activities:  
Depreciation expense4,489 4,634 
Amortization expense1,116 1,128 
Amortization of debt issuance costs75 75 
Goodwill impairment— 11,389 
Deferred income taxes6,639 (7,864)
Provision for losses on accounts receivable121 327 
Provision for losses on inventories1,300 1,980 
Loss on disposal of property, plant and equipment— 182 
Non-cash lease expense171 190 
Stock-based compensation expense601 701 
Changes in operating assets and liabilities:
Accounts receivable(1,283)3,754 
Inventories8,038 5,880 
Other assets and liabilities(918)358 
Accounts payable(4,237)8,872 
Accrued expenses1,973 (217)
Accrued income taxes669 (772)
Net cash provided by operating activities - continuing operations7,445 4,002 
Net cash (used in) provided by operating activities - discontinued operations(1,587)17,525 
Net cash provided by operating activities5,858 21,527 
Investing activities  
Purchases of property, plant and equipment(1,281)(2,411)
Net cash used in investing activities - continuing operations(1,281)(2,411)
Net cash provided by (used in) investing activities - discontinued operations2,797 (394)
Net cash provided by (used in) investing activities1,516 (2,805)
Financing activities  
Borrowings from long-term debt156,923 201,588 
Proceeds from note payable914 900 
Payments on long-term debt(156,923)(220,130)
Payments on note payable(633)(657)
Principal payments on finance lease obligations(221)(231)
Repurchase of common stock(738)(903)
Net cash used in financing activities(678)(19,433)
Increase (decrease) in cash and cash equivalents6,696 (711)
Less: Cash and cash equivalents of discontinued operations— 1 
Cash and cash equivalents, beginning of period1,851 1,440 
Cash and cash equivalents, end of period$8,547 $730 
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Ascent Industries Co.
Non-GAAP Financial Measures Reconciliation
Reconciliation of Net Income (Loss) to Adjusted EBITDA (Unaudited)
($ in thousands)

Three Months Ended
September 30,		Nine Months Ended
September 30,
($ in thousands)2024202320242023
Consolidated
Net loss from continuing operations$(7,016)$(14,678)$(11,309)$(26,615)
Adjustments:
Interest expense, net124 1,063 323 3,217 
Income taxes7,479 (1,380)6,270 (4,680)
Depreciation1,438 1,522 4,489 4,634 
Amortization372 376 1,116 1,128 
EBITDA2,397 (13,097)889 (22,316)
Acquisition costs and other5 — 83 277 
Goodwill impairment— 11,389 — 11,389 
Gain on lease modification(67)— (67)— 
Stock-based compensation55 134 158 371 
Non-cash lease expense60 63 171 190 
Retention expense— 6 4 6 
Restructuring and severance costs— — 208 90 
Adjusted EBITDA$2,450 $(1,505)$1,446 $(9,993)
% sales5.7 %(3.2)%1.1 %(6.6)%
Specialty Chemicals
Net income (loss)$367 $(11,498)$(682)$(10,974)
Adjustments:
Interest expense19 21 57 52 
Depreciation expense945 942 2,863 2,850 
Amortization expense174 159 522 475 
EBITDA1,505 (10,376)2,760 (7,597)
Acquisition costs and other— — — 2 
Goodwill impairment— 11,389 — 11,389 
Stock-based compensation— 3 7 (13)
Non-cash lease expense19 23 58 69 
Restructuring and severance costs— — 109 — 
Specialty Chemicals Adjusted EBITDA$1,524 $1,039 $2,934 $3,850 
% segment sales7.3 %5.2 %4.7 %5.9 %
Tubular Products
Net income (loss) from continuing operations$1,653 $(620)$1,040 $(7,215)
Adjustments:
Depreciation expense476 558 1,566 1,717 
Amortization expense198 218 594 653 
EBITDA2,327 156 3,200 (4,845)
Acquisition costs and other3 — 29 — 
Stock-based compensation— 2 11 (15)
Non-cash lease expense25 31 75 93 
Restructuring and severance costs— — 31 84 
Tubular Products Adjusted EBITDA$2,355 $189 $3,346 $(4,683)
% segment sales10.7 %0.7 %4.5 %(5.4)%
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v3.24.3
Cover Page
Nov. 12, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Nov. 12, 2024
Entity Registrant Name Ascent Industries Co.
Entity Incorporation, State or Country Code DE
Entity File Number 0-19687
Entity Tax Identification Number 57-0426694
Entity Address, Address Line One 20 N. Martingale Rd,
Entity Address, Address Line Two Suite 430,
Entity Address, City or Town Schaumburg,
Entity Address, State or Province IL
Entity Address, Postal Zip Code 60173
City Area Code (630)
Local Phone Number 884-9181
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, par value $1.00 per share
Trading Symbol ACNT
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Entity Central Index Key 0000095953
Amendment Flag false
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