Good morning, all. Good afternoon, all. Welcome to the Ingevity First Quarter 2024 Earnings Webcast. My name is Adam, and I'll be your operator for today. If you'd like to ask a question during the Q&A portion of today's call, you may do so by pressing star followed by one on your telephone keypad. I will now hand the call to John Nypaver to begin. John, please go ahead when you are ready. Thank you, Adam. Good morning, and welcome to Ingevity's First Quarter 2024 Earnings Call. Earlier this morning, we posted a presentation on our investor site that you can use to follow today's discussion. It can be found on ir.ingevity.com under Events and Presentations. Also, 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 non-GAAP financial measures and reconciliations to comparable GAAP measures are included in our earnings release and are also in our most recent Form 10-K. We may also make forward-looking statements regarding future events and future financial performance of the company during this call, and we caution you that these statements are just projections, and actual results or events may differ materially from those projections, as further described in our earnings release. Our agenda is on slide three. Our speakers today are John Fortson, our President and CEO, and Mary Dean Hall, our CFO. Our business leads, Ed Woodcock, President of Performance Materials, Rich White, President of Performance Chemicals, and Steve Hulme, President of Advanced Polymer Technologies, are available for questions and comments. John will start us off with some highlights for the quarter. Mary will follow with a review of our consolidated financial performance and the business segment results for the first quarter. John will then provide closing comments and discuss 2024 guidance. With that, over to you, John. Thanks, John, and good morning, everyone. Turning to slide 4, we had a good, strong start to 2024. Performance Materials, revenue and EBITDA were both up strongly, and the segment-generated margin is close to 54%, exceeding expectations and executing well. This performance is a result of a lot of hard work by the PM team. Volumes were up from a year ago, and the business benefited from higher pricing, improved throughput, and lower input costs. APT performed relatively well this quarter. While revenue and EBITDA were down versus a year ago, they are being measured against a tough comparable period. First quarter 2023 was the last quarter before the stocking began. Positively, though, they have now posted two quarters of sequential volume improvements, and this is hopefully a good sign of a gradual recovery in their end markets. Importantly, despite these lower volumes, they maintained strong margins in the quarter. Performance Chemicals is tracking in line with our expectations for our repositioning strategy. The first quarter is a seasonally light quarter before the paving season really kicks in and is also being negatively impacted by the costs we are paying for crude tall oil. Our savings targets remain on track. The transition to reduce our reliance on CTO is moving forward as we completed the shutdown of our DeRidder site during the quarter, and we are increasingly using oleo-based products coming out of our Crossett facility in existing end markets like pavement and lubricants. In a few moments, I'll review our 2024 guidance and provide some perspective on expectations for the rest of the year. But before that, let me turn it over to Mary for more details on the quarter's results. Thanks, John, and good morning, all. Please turn to slide 5. First quarter sales of $340.1 million were down 13%, due primarily to our repositioning actions in Performance Chemicals, which included a plant closure and our exit from certain low-margin end markets. Also contributing to lower sales were continued weakness in China and certain industrial end markets that negatively impacted sales in our APT segment and industrial specialties product line, more than offsetting a 3% increase in Performance Materials sales. For the quarter, we had $64.8 million of restructuring charges and $26.5 million of CTO resale losses related to the Performance Chemicals repositioning. These charges led to a GAAP net loss of $56 million. We've excluded the impacts of the restructuring charges and the CTO resale losses in our non-GAAP disclosure and our discussion for the remainder of this presentation. A reconciliation of our non-GAAP measures to GAAP is in the appendix to this deck and also in our earnings release and Form 10-Q, which will be filed later this evening. Our adjusted gross profit of about $120 million declined 19%, and our adjusted gross margin was down 260 basis points to 35.2%, due primarily to the combination of lower sales in Performance Chemicals and APT and CTO spend that was significantly higher year-over-year on lower purchase volumes. Adjusted SG&A improved 6% year-over-year. For the quarter, we realized a total of approximately $20 million of savings related to the Performance Chemicals repositioning and the other corporate actions taken last year. Of the $20 million in savings, about $5 million is reflected in SG&A and about $15 million in COGS. We are on track to realize our target of $65 million-$75 million in annual savings. Our diluted adjusted EPS and adjusted EBITDA declined on lower earnings, but we still delivered a strong adjusted EBITDA margin of 22.6%, reflecting the underlying strength of the company's core portfolio as we complete the repositioning of Performance Chemicals and exit certain lower-margin products and end markets. We estimate our 2024 tax rate will be between 23% and 25%, slightly higher than last year. Turning to slide 6. The top left chart shows a key impact of the Performance Chemicals repositioning. As we exit the low-margin end markets in PC, the Performance Materials segment becomes a larger percentage of total company sales, increasing to 43% of sales this quarter. As we discussed last quarter, our actions are improving the company's overall portfolio mix, making it more balanced and improving the margin profile. Our first quarter free cash flow was negative $28.7 million, compared to negative $20 million in Q1 last year. Remember that negative free cash flow is more the norm for the first quarter as we're building inventory for the summer paving season. But this quarter's number also includes $19.8 million of cash losses on CTO resales and $7.3 million of cash spend associated with Performance Chemicals repositioning. While our net debt was lower year-over-year, our leverage ratio increased due to lower EBITDA. We anticipate leverage will peak in the second quarter before improving to around three times by year-end. Reducing our leverage is our number one priority for capital allocation this year. We are in compliance with all of our bank covenants and expect to remain so. Turning to slide 7, you'll find results for Performance Materials. Sales were up 3% to $145.1 million, and EBITDA was up an impressive 12% to $78 million, with an EBITDA margin of almost 54%. Truly, the business was firing on all cylinders for the quarter. There were many drivers of this performance. Annual price increases went into effect. Our activated carbon volumes were up in all regions. We had no scheduled nor unplanned downtime, and our talented engineers completed a series of debottlenecking projects that improved plant throughput. Also, input costs, such as energy and certain key raw materials, were lower year-over-year. For the remainder of the year, the segment has scheduled downtime in at least one facility in each quarter, so the benefit we saw this quarter from high utilization rates is expected to be lower going forward, and energy and other input costs can fluctuate significantly, as you know. On the positive side, auto production estimates are calling for higher production this year versus last year, despite softer than expected production numbers in Q1. This is a long-winded way of saying: Don't expect every quarter to post 54% EBITDA margins. As we always caution, quarters can be choppy. For example, last year, quarterly margins ranged from 44%-51%. We continue to expect mid- to high 40% full-year margins for this segment. Turning to slide 8, revenue in APT was $48 million, down 27% to primarily the lower volumes, which we attribute to the continued global demand weakness in many of the segment's end markets. As John mentioned in his earlier comments, APT had a strong Q1 last year, but end market demand weakness beginning in the second quarter last year, so the Q1 year-over-year comp is challenging. China demand, in particular, continues to be weak, negatively impacting one of our biggest end markets in China, which is paint protective film for autos. While China auto production is up, the film is an aftermarket purchase, and due to the economic slowdown, Chinese customers appear to have paused discretionary purchases on items like protective film for their cars. While China remains weak, we are encouraged to see two quarters of sequential volume improvement in APT, driven by Europe and North America. However, forward visibility is limited as customers continue to be cautious in their outlooks for the year. Based on discussions with customers and peers, we believe the recovery is likely to be more of a second-half event. Despite lower volumes negatively impacting plant throughput, EBITDA margins remained a healthy 20%, supported by lower energy, logistics, and raw material costs, as well as improved SG&A as a result of cost-saving actions. Should the industrial recovery continue to be delayed, we are confident in the steps Steve and his team have taken to improve business operations. Please turn to slide 9 for Performance Chemicals. Sales of $147 million were down nearly $40 million as we continued to execute the repositioning of Performance Chemicals and exited lower-margin products and markets. We also experienced some softness compared to last year in certain industrial markets, such as lubricants and rubber. These end markets, along with ag chemicals and certain oil field products, are the primary end markets in which we continue to participate, and they represented roughly two-thirds of the $101.3 million of Industrial Specialties sales in the quarter. We believe this is a good proxy for quarterly sales for Industrial Specialties going forward in 2024. The remaining roughly one-third of Industrial Specialties sales this quarter were a finished goods inventory into the end markets we are exiting. Road Technologies sales in Q1 were flat year-over-year, with Q1 being a seasonally low quarter. Wet weather delayed some projects that had been slated for the first quarter in Europe, but the strength of the North American market helped minimize the impact of those delays. We believe that summer's paving season will be strong for both pavement and road markings. EBITDA for the segment was negative $10.6 million due to a significant decline in gross margin, driven by higher CTO spend, which nearly doubled from last year, and unfavorable plant throughput due to continued weakness in industrial end markets, which is negatively impacting utilization rates at both the Charleston and Crossett manufacturing sites. We expect second quarter CTO spend to be similar to Q1 and expect it will trend lower in the second half of the year. Based on the prices we see in our CTO contracts and on the spot market, we are adjusting our 2024 estimate of the losses on CTO resales from between $30 million-$80 million to between $50 million-$80 million. As a reminder, these losses are not included in our adjusted EBITDA, but are reflected in free cash flow. In addition, we still expect to spend approximately $50 million-$60 million this year in cash costs related to the repositioning, with about $7 million spent in Q1. As John mentioned, our repositioning of Performance Chemicals is on track. We have ceased production at our DeRidder site. We are realizing the cost savings from the actions we took last year, and we have improved the profitability profile of the company moving forward. Now I'll turn the call back over to John for an update on guidance and closing comments. Thanks, Mary. Please turn to slide 10. We reiterate our full year guidance of between $1.4 billion and $1.55 billion dollars in adjusted EBITDA between $365 million and $390 million dollars. Our first quarter results are encouraging. We expect the Performance Materials segment and the Road Technologies product line in our Performance Chemicals segment will both have very strong years. Auto production that includes our material will remain robust as hybrid production increases. The road paving season is off to a good start, and our order book is strong. These high-margin, high-growth businesses will anchor our performance this year and are at the center of our strategy going forward. An industrial recovery will primarily benefit our Advanced Polymer Technology segment and sales into Industrial Specialties markets and Performance Chemicals. I agree, I agree with many of our chemical peers that the second half of the year should be better than the first half and that sequential signs of improvement are encouraging. However, many of our peers have yet to see significant enough demand recovery to call for a strong rebound, and we are in this camp as well. It is still early in the year, and it's an election year. We will see. We are cautiously optimistic about demand patterns and believe APT has upside opportunities to our outlook if we continue to see sequential demand improvement. Sales into the Industrial Specialties markets will remain challenged due to the high price of our CTO-derived products versus substitutes available in the market. By closing DeRidder, we have exited many of our low-margin markets, but we do have some residual exposure. We are making significant progress in sales of our oleo-based materials, but the broader market's weakness is not helping us accelerate those efforts. As we said last quarter, we will be very disciplined in cash management and are reducing capital expenditures and other capital allocation strategies while we focus on deleveraging to our more normalized historical levels by year-end. As we move through the remainder of the year, we are focused on completing our business transformation and positioning the company for more stable and sustainable profitability. We will continue to adjust our footprint and cost base, if necessary, to respond to any adverse changes from our base case. As I close, there are a lot of reasons to be excited about Ingevity in 2024 and beyond. As a management team, we are committed to delivering on the strategy we have laid out, especially as it pertains to Performance Chemicals repositioning. Our results in the first quarter show how we are tracking to those goals. We also recently completed a comprehensive review of our APT business in the U.K. We are excited about the opportunities that business has. Bioplastics will continue to play a bigger role in packaging and clothing fibers, and we are participating in that growth. Road Technologies is expected to continue its expansion outside of North America while building on its market-leading presence in the U.S., and Performance Materials will continue to be the market leader in gasoline vapor emissions controls, reaping the benefits of the popularity of hybrids and consistently delivering strong margins and growth for us. With that, we'll turn it over for questions. As a reminder, if you would like to ask a question today, please press star followed by one on your telephone keypad now to enter the queue. When preparing to ask a question, please ensure you are unmuted locally. Now, our first question today comes from Vincent Anderson from Stifel. Vincent, your line is open. Please go ahead. Thanks. Good morning, everyone. Hello, Vincent. Good morning. Good morning. Is it, is it fair to infer that, you know, from the much smaller difference between your booked losses on CTO resale versus your cash losses on CTO resale, that your costs are converging towards that resale price? Not exactly yet, but, as we mentioned in the call, I mean, we do expect to see our situation improve in the back half of the year. I mean, our estimated costs for Q2 are down slightly from where we were in Q1, but we do expect that. Similar. Yeah, we'll see similar in Q2, but we'll see, you know, more acceleration or that more of that convergence in the back half of the year. Sure. And I mean, I understand that a lot of that is contingent on volume actually pulling that cost through the PNL, but, you know, I assume that- That's right. Yeah. Listen, as I mentioned in my closing remarks, I mean, we will continue to assess our options with regards to CTO and how that works, right? I mean, we are, as you know, pushing pretty hard on oleo-based chemistries. There's a reasonable likelihood that, you know, that should be 10% of revenue for that business next year or this year, sorry. You know, we're continuing to look at, you know, are there other ways for us to continue to service the markets that we're in with a different operational footprint? So all those things are on the table. Okay. But I do. You know, to get back to your question, I do think that crude tall oil is the pricing that we pay vis-à-vis what is, you know, sort of the secondary market or at, or what have you, will continue to improve over the course of the year, particularly in the back half. Sure. Okay. Fair enough. That, that's helpful. And then just quickly, could you give us maybe an update or, or details that we didn't get into before on that paving agreement in Brazil? Like, is this that you've been spec'd in with a customer, and they'll market it, but sales still depend on adopting- You are digging around, aren't you there, Vincent? Well, I mean, you brought it up. Rich, I'm going to turn that over to you. Hey, Vincent, this is Rich White. Yes, we are progressing well with this customer that you have uncovered in Brazil. They have transitioned one of their sites totally over to our technology, and we're happy with the progression that is being seen associated therewith. I mean, we've got obviously, there's competitive information, Vincent, but what I will say is this is a very large opportunity with a very large company down there. It's very encouraging that they're looking at our technology, predominantly because it, it brings a lot of, you know, not only performance attributes, but also production advantages because you're doing this at warm versus high mid-high temperature mix. So it's a big opportunity and, and we will continue to work on it. Great. And actually, just a quick clarifying question on that one for when it shows up: Is Brazil-- Brazil would be opposite season, or is it more dependent on rain rather than temperature for them? Yeah, that's a great question, Vincent. It's more dependent on the rainy season. You can really pave all year in Brazil, but it depends on how, when the rainy season comes on, on their ability to pave the roads. Okay. All right. Thanks. I'll turn it over. The next question comes from Daniel Rizzo from Jefferies. Daniel, your line is open. Please go ahead. Good morning. Thank you for taking my call. Just first a clarification, did you indicate that, and did I hear right, that Industrial Specialties should have a run rate of about $100 million in sales per quarter for the year? Is that, is that what was said, or did I hear that wrong? No, no, Dan, I'm probably was battling a cold, so maybe a little hard to understand. With $101 million in sales in the quarter, and what I said was about two-thirds of that is the run rate that you should expect going forward for sales for Ingevity, that the remaining one-third is largely due to selling off finished goods inventory in the markets that we're exiting. That's completely done, the selling off the inventory? Hmm, there's some nominal amount left, but, most of it in Q1. That was the big slug. And you indicated, I think, you wanted to get to 10% sales from Oleo-based products, but I think by the end of the year. I don't know if you can disclose this. Is that up, like, from, like, 2% now, or where are we at, like, right now? Well, you have to be careful with it because some of it is product substitution versus sort of new market sales, right? So, you know, we are selling modest levels of oleo-based stuff. We've got a lot of testing going on and certification, et cetera, right? But when you kinda roll it all up across all the businesses, you get to a number that's not too far from that. Okay. Okay. And then, finally, I just, again, coming back to the, the PM EBITDA margin of 54%, I realize you said that don't expect that every quarter. But I mean, high 40s, low 50s is now the norm? Because I, I thought, and I could be wrong here, like, a few years ago, low 40s was kind of what we're, we were hoping for, and now we've obviously moved well beyond that. Oh, that's right. You're right. We used to say low to mid-40s, and I think we said, now we're at mid- to upper 40s. That is correct. We've always said, Dan, look, we will do everything in our power to maximize the profit of that business every quarter. Just, you have to understand that it has some lumpiness to it based on when we take outages, you know, when Chinese New Year comes, and when they pre-buy. There's just a lot of moving parts, so you can't take one quarter's margin and extrapolate it across the year, good or bad, right? So we, we set ourselves a long-term target of being in the high 40s, and we'll do better than that when we can. Okay. All right, thank you, guys. Thanks, Dan. The next question comes from John McNulty from BMO Capital Markets. John, your line is open. Please go ahead. Yeah, thanks for taking my question. So I guess first one, you know, we heard from the EPA kind of a new PFAS kind of level going forward. And some of the solutions, at least early on, looked like from a water table perspective, it's gonna be tied into activated carbon or carbon in general. I guess, can you speak to the conversations that you're having there? And if it's resulting in any early demand flow, or is that something more on the come as we kind of look through, whatever, the end of this year and into next year? Yeah, John, this is Ed. You know, obviously, as you mentioned, it's a big deal around the country at this point with PFAS and PFAS. Each carbon that's used for these have unique chains and molecules, and so, you really have to test the product first to see whether it's got efficacy for the particular PFAS or PFOS or PFOA that you've got in the system. And so, you know, it's, we see, you know, that opportunity as something for us to do with our powdered activated carbon products. But, you know, we're really trying to make sure that we maximize the sales rate as well as the profitability as we go into those markets. Got it. Okay. No, makes sense. And then just a question on the PM business. Can you speak to the pricing environment that you're seeing and how much that contributed to the margins just versus, you know, running without downtime? Because, again, we've seen, you know, we've seen periods when you haven't had much downtime, and we haven't seen margins quite like this, so just wondering how much pricing might have contributed to that. Yeah, John. You know, for us, we look at it for year-over-year opportunities for us, and so we continue to add price mid-single digits as we move forward throughout the year. Sometimes it will be lower or higher, but you know, we try to make sure that we're continuing to capture the value that our products do for the products that we have. And when you think about it, most of that price increase really sits on the activated carbon itself- Mm-hmm ... and not so much on the honeycomb. So as you're building your models, John, you can think about that. I think prior quarters, I'll chime in here. Prior quarters, we were talking about Process Purification when auto production was a bit depressed. Now, auto production's on the rise, so you're getting that mixed benefit as well from process purification applications into the activated carbon for autos. And a good piece of that margin upgrade is related to that mix upgrade. John, I, I would actually encourage you. So as I was driving in this morning, I was listening to CNBC, and they were talking about Ford's, I guess, either monthly or quarterly sales numbers, right? And, you know, the headline number is like, well, ICE is down. Traditional ICE is down and EVs are up, right? But ICE was down some percentage. EVs were, you know, all-electric EVs were up some percentage, but hybrids were up 59%, right? And a hybrid is, for us, basically another internal combustion engine. So... And those are sales, right? And then they came and actually talked about it, 'cause you could argue that a lot of Ford's EVs, so all-electric sales, were them trying to clear inventories by cutting price on the lots to get the Mustangs and all that stuff moving, right? So we look at, obviously, what drives us is production, right? But you can look through, and I would encourage you, as you guys think about this, to understand that dynamic because I thought that was a very telling set of statistics, right? You've got EV sales up, but they're clearing high-priced stock, cutting price, trying to clear their inventory. Where they're building are in hybrids, and that is very, very encouraging for us, and we expect that trend, that trend to continue and not be just at Ford. Yeah. Right? Right. So... Got it. No, that's a very helpful call. Thanks very much. The next question comes from Ian Zaffino from Oppenheimer. Ian, your line is open. Go ahead. Hi. Great, thank you very much. Wanted to ask you, I guess, on the previous question on the hybrid side is, you know, what you're seeing in the market pretty much accurately reflects what you guys are saying about hybrids doing much better. But when you talk about it being, let's just say, similar to an ICE vehicle, I think those were your words or something similar. Do we, is that because the OEs are using common parts for both ICE and hybrid? Or basically, why is that happening? Because I thought the understanding was that hybrid vehicles would have smaller tanks and therefore lower need for activated carbon. Is that not the case? And if that's not the case, kind of give us a little detail on what's going on there. Thanks. All right. Yeah, Ian, it's Ed. With hybrids, you've got, you know, relatively small vehicle with small gas tanks. As it comes around to fill up those gas tanks, you have to kind of depressurize the system, and so you need that same amount of activated carbon on that fuel tank. As they depressurize the fuel tank, it rapidly goes into a canister system where the activated carbon captures it. So it's almost, you know, from my perspective, we also have some honeycombs and carbon on those systems, depending on the mechanism that each individual OEM is trying to do for those vehicles. So, you know, I still like the hybrid vehicle. It's really gaining share. It's up. You know, if you look at across the Q1, plug-in hybrids and hybrids were up 320 basis points. So you see kind of just the auto as people are looking for what they're gonna buy next, they're really excited about the hybrids and the plug-in hybrids. When you think about it, Ian, a hybrid represents a very good solution for most consumers, right? I mean, I use myself as an example. I live about 10 miles from the office, right? So I can go back and forth from work running the electric, right? But when I need to take the long trip to take my kids somewhere or whatever, right, then you have that flexibility, and it removes that range anxiety. So, you know, but 95% of the time, it's running electric, right? And so, you know, I think consumers, when you look at that versus relative price point of these things, right, consumers are saying, "Well, this makes the most sense, right?" And we're just benefiting from that. Understood. Okay. And then, you know, on, on the AFA push, I know there's a lot of testing certification. Maybe can you give us an idea of how that's going, maybe versus expectations or success rate or anything along those lines as far as just color on, on how that's going? It's just a, Ian, it's just a very slow process, right? I mean, you know, we unfortunately don't control it, right? It's one of those few variables that we can't really control. You know, we have a very active dialogue with the regulators. We're talking to them almost continuously. So you know, what we're doing is we're continuing to work with customers to try and drive and get them interested and test, and then we obviously put these things into the certification process. Where we're having the most success, really, frankly, is some in our, mostly in our Pavement Technologies business, some other, you know, industrial applications, oil field and others. But, it's encouraging because, you know, as these certifications and we're able to clear, I mean, I think we're gonna see us be able to have more success. But look, we're managing it. We're going as fast as we can, and we feel good about the progress relative to, you know, what we can actually do. Okay, great. Thank you very much. The next question comes from Jon Tanwanteng from CJS Securities. John, your line is open. Please go ahead. Hi, good morning, and thank you for the questions, and congrats on a nice carbon materials quarter. I was wondering if you could talk a little bit more about the mix shift towards hybrids and possibly away from large trucks and SUVs, where I think you've traditionally had more content. Has that factored into what you've seen in the quarter? And, are the ASPs on the hybrids comparable to the content... Excuse me, the content levels there comparable to what you saw in those larger vehicles? Yeah. So, you know, we love F-150s. We love full-size trucks. We have a significant amount of content on them because they have large fuel tanks and generate a lot of vapors coming out of them. But that being said, even with smaller vehicles, the heat of the vehicle can drive more emissions coming out of the fuel tank as well. So it depends really on, you know, the type of vehicle and the design that they've got and the space that they have to have. And, you know, in a lot of cases, they have to put additional content on a canister with additional honeycombs so that they can meet the requirements that the EPA has in place. Okay, got it. And then, just a quick question on the Industrial Specialties business. I was wondering if you could comment on the profitability on that, on the two-thirds of that $100 million, if you're making any money on that, if it's relatively neutral, just given the high- It worked against us. How was your money? We would have been better if we didn't have it. It's a sore subject here, John. It's fair to say it's loss-making then? ... Yep. Well- We're talking about the 2/3 that we're keeping. We're talking about the one-third that we gave up. Are you talking about the one-third or the two-thirds, John? No, the two-thirds. I know the one-third isn't so great. Yes. The two-thirds is the stuff that's making money. Yeah. Right. Yes. Right. Sorry about that. Make sure you get that straight. Just- We would have preferred, although, you know, you can't do it from an accounting- Is it possible to quantify the degree of profitability there? What's that? Is it possible to quantify or ballpark the degree of profitability on those sales? No, we don't, we don't get into EBITDA at the product line level, John. And it's too convoluted, John. I mean, look, the best way to describe it is that the two-thirds that we kept are, or that Mary's referring to, is stuff that we continue to be, we expect to be recurring. These are markets that we're gonna continue to participate in. The one-third that came out of DeRidder wind down was effectively loss selling because we were exiting those markets, and as we talked about, we're exiting markets that are lower margin, not things that we consider attractive going forward. Right? But you're gonna have a hard time with that, John, in this quarter, 'cause this is all... You know, this is the first quarter before things get rolling. Right. And I understand that the Performance Chemicals results for the next couple of quarters will, you know, be hard to see in spec because paving season kicks in, and you've got Road Technologies and their profitability profile kicking in. But, you know, really, all we can say is the two-thirds that we kept, we kept it because it's making money. Right. Fair enough. Thank you. Next question now comes from Mike Sison at Wells Fargo. Mike, your line is open. Please go ahead. Hey, nice start to the year. I guess for Performance Chemicals, is the way to look at it, if you add back the $26.5 million loss to EBITDA, and that net number is kind of what the ongoing entity is sort of producing. So it's kind of a, you know, 10% EBITDA margin for Q1, but that should scale up as Road Technologies kicks in gear in Q2 and Q3? I don't think that's the way to look at it, Mike. I mean, I would argue the other way, right? Meaning that if you wanted to look at it from a cash basis, right, the business lost about $30 million this quarter, right? The negative ten of, you know- Oh, okay ... EBITDA loss plus the, right? Yeah. Plus the- Plus the CTO. Right, the CTO resales. Now, we are, and you'll see this in the 10-Q and all of Phil Platt's incredible disclosure, but, you know, we are—the excess CTO that we are buying, we are going ahead and marking that to market or what we think is a more reasonable price. So you're gonna see that run through as sort of a non-cash charge that will fall through, not in the EBITDA, but in the other income and expense, right? And also in the statement of cash flow, right? The CTO that we're running through, we're running through at cost, and that's gonna impact the profitability of the segment, right? So you just have to kind of look at those. When I look at it, right, we... And then we offset that with the sales, right, the CTO that we do. So you look at this quarter, we had kind of $20 million of cash losses. That's a function of the hit that we were paying to our supplier, offset by the sales that we were able to make in the market, and they were not one for one. So, but in the quarter, we, you know, lost $20 million on that sort of netting out. And then on top of that, there was about a $6.8 million adjustment as we took the write down on the excess that we're still holding to bring it down. So going forward, through our P&L and our statement of cash flow, to the extent we do resales now, and we get better than where we've marked it to, you know, it'll be up or down, but it'll be less volatile, right? But you need to understand that we're gonna continue to be taking excess CTO for a while, so you're gonna see that run through, right? No, I understand. But we don't- Okay. Yeah, we don't. From an EBITDA perspective, you know, these are not our ongoing primary operations, so it's not included in the EBITDA. This is not our, a business that we're in, right? Right. Right. No, understood. And then I apologize if I missed this, but for Performance Materials, what do you think the sales growth is gonna be this year? Well, we don't break it out by... But, you know, I mean, I, I think we expect sales. I mean, you can look at the first quarter, you can look at what we did last year. You know, we expect our sales to continue to grow at a pretty healthy clip, right? Maybe not as strong as last year, but, certainly from- It's tied to auto production. It's tied to auto production, and we see that improving. Right. Right. In Q1, actually, auto production was a little bit softer- Right ... than had been originally expected. So, Ed's results definitely benefited from that price increase that we talked about as well. Right. Going forward, you know, the auto estimates are expected to strengthen throughout the year. Right. Production is expected to strengthen throughout the year, and we should see the benefit of that. I mean, we sort of, you know, we, we've said this before, Mike. I I mean, we sort of directionally track IHS. Right. We obviously look at a lot of different sources, banks, economists. Customers. Customers being the predominant input, right? And then we look at a calculation of, you know, ICE/hybrid production by region, right? And then that kind of gives you a direction of what we think things are gonna look like, right? Got it. And then last one on APT. Do you think we've bottomed here and start to get some sequential improvement in sales? Or we still got a little bit, a little bit of a headwind in 2Q before, hopefully, things get better in the second half? So we did see two quarters, actually, in a row, sequential improvement. So we are hopeful that, you know, we are at the bottom. I'd like to see another quarter or so and see that momentum continue. But clearly, they did take a hit from the global slowdown, industrial demand weakness, but they have been able to generate two quarters of sequential improvement. Right. And the other thing, like I would say, is we are very proud and of the margin, 'cause we have these kind of fall-offs in volume. Getting your cost structure to reflect that and get your margin in position is not a simple undertaking. Now, obviously, they were benefiting from energy, but I would argue that might have been an artificial you know, negative a year ago, right? So, but for them to be able to kind of grapple with this and keep their margin percentages where they are, that's. that's. It took a lot of hard work. You know, with regards to the industrial economy, look, we look at it, and we're encouraged, as Mary said, but we're also just not gonna call it until we see a little more time, right? It's been fragile. It's been bouncing around the bottom. Looks good, feels good, but we're just not gonna call it till we get a little more time under our belt. It was volume improvement- Right ... which is what we've been keying off of- Right ... to try to assess whether we're seeing- Right ... a healthier demand environment going forward. Got it. Okay. Thank you. The next question comes from Chris Kapsch from Loop Capital Markets. Chris, your line is open. Please go ahead. Yeah, good morning. I have a couple follow-ups. First, on Inspec. So, the business that you're exiting, I understand the losses and, obviously, the ability to get pricing there is just not great, and it's probably the most competitive. But could you just characterize your ability to get pricing in the Inspec business that you'll be sticking with? You know, 'cause you still have this CTO inflation. Yeah, so I mean, the biggest issue really centers around rosin pricing, right? Chris, and you know, rosin, as you know, our rosin is mostly in sort of what I would call industrial applications, and highly vulnerable to substitution, right? It doesn't help that some of our competitors in traditional crude tall oil-based rosins have a better cost structure than us, but we have to respond to that, and you know, we have to deal with that, right? And that's because of the CTO. But the most of the stuff that we exited, and this is predominantly a function of DeRidder. You know, DeRidder was really run as a rosin site, right? I mean, that's really where it made its money. And then it also had the advantage of selling some TOFA into the oil field markets, right? Because it's obviously producing TOFA. But when you look at that in the aggregate, you have to kind of ask yourself, when you run a ton of CTO and where its end markets are positioned, does it make economic sense for the enterprise, right? We feel like what the footprint that we have today is more in balance, right? That's predominantly because the Charleston plant's primary end market is Road Technologies, right? And so those are the markets that it's serving. It does have some rosin that comes out that aren't needed in those markets, but things like Ozark help with that because they use rosin, right? But generally speaking, it makes that rosin problem a lot smaller relative to the value that you get from a TOFA. That's the best way to describe it. Yeah. I got it. Makes sense. And then the follow-up on the PM segment was around the hybrid discussion. I'm just curious if, you know, to the extent you're getting mix lift, is there any way to characterize how much benefit you're getting from your products for the new technology where you have IP, the low purge engine technology? That. I think that's at play both in hybrids as well as maybe just, you know, advanced modular platforms. Thanks. What percentage of your sales are covered around the new patent today? Yeah, I- Probably the best way to- Within North America, there's a high level of patent protection across those, right? As it's a Tier 3 requirement, right? Which you're looking to get extremely low levels. And the canisters themselves with activated carbon help, but you need, in a lot of cases, honeycombs. Some of those honeycombs vary on their content and efficacy, and we help the OEMs and the tier ones to help design the canister system that they're looking to put our products into, right? That's important, Chris, because the most of this hybrid push is in North America today. Yes. Okay. Yeah, with China 7 coming along- Right. Eventually, we'll benefit in China, right? Right. Appreciate the color. Thanks. We have no further questions, so I'll hand it back to John Nypaver for closing remarks. Thanks, Adam. Well, this concludes our call. Thank you all for your interest in Ingevity, and we'll talk with you again next quarter. This concludes today's call. Thank you very much for your attendance. You may now disconnect.