Ascent Industries: Questions to J. Bryan Kitchen | Value Bridge
Archieve - Everything J. Bryan Kitchen Said
Business Summary
Ascent Industries (formerly Synalloy) is a specialty chemicals platform focused on solving technical problems for formulators in oil & gas, water, HI&I, coatings, and adjacent markets. The company develops and scales customized formulations from lab to production, increasingly emphasizing branded/proprietary offerings over low-margin tolling. It operates three U.S. plants with significant unused capacity, targeting margin-accretive volume without heavy capital needs. Management reports a portfolio mix shift (from custom toward branded), recurring multi-year contracts, and disciplined capital allocation, including share repurchases and selective bolt-on M&A. Notable transcript-cited figures include $45 million proceeds from the Bristol Metals sale, $55 million cash on hand post-divestiture, remaining tubular revenue of $27 million, expected tubular EBITDA of $4–6 million with sale multiples of 4–6×, annual run-rate CapEx of $1–3 million, a staffing base of 274 people, plant utilization of 50%, a branded contract adding $750,000 annual adjusted EBITDA (≈10% of the prior year’s EBITDA), and a TAM of $9.2 billion across key verticals. The long-term margin ambition for Specialty Chemicals is 15–20% adjusted EBITDA, with ~15% cited as typical for the industry.
Catalysts & Milestones
1945 - Company founded
2014 - Acquired seamless pipe & tube business for about $28 million
2018 - Seamless pipe expected 25% EBITDA margin, marking a performance peak
2022 - Earn-outs scheduled to end, freeing $1 million per quarter for debt reduction
2023 - Oil & gas vertical had virtually no revenue; baseline set for later wins
2023 - Business mix benchmarked at 90% custom / 10% branded products
2024 - Good Friday 2024 rapid-response win created $5–6 million new business at >20% EBITDA margin
2025 - Bristol Metals sale closed, generating ~$45 million proceeds and ~$55 million cash post-deal
2026 - Management expects upward sales momentum as the company moves into 2026
Investment Highlights
Post-divestiture cash of $55 million supports buybacks and bolt-ons.
Plants at 50% utilization enable growth with $1–3 million annual CapEx.
Bristol sale delivered $45 million proceeds; remaining tubular at $4–6 million EBITDA, 4–6× sale target.
Contract adds $750,000 annual adjusted EBITDA (≈10% of prior year’s EBITDA).
TAM $9.2 billion across HI&I (30%), personal care (30%), oil & gas (20%).
Future Growth Drivers
Mix shift from custom to branded/proprietary products, improving pricing power and margins.
Fill underutilized capacity (50% utilized) with margin-accretive volume requiring minimal CapEx.
Vertical integration via potential specialty distribution acquisition to capture 10–12× distributor economics.
Capability add-ons (rail access, glass-lined reactors) to unlock new customer classes.
Monetize remaining tubular asset ($4–6 million EBITDA at 4–6×) and redeploy into chemicals.
Multi-year customer agreements (e.g., $750,000 EBITDA contract) to deepen recurring revenue.
Process automation in batch manufacturing to lift cost, reliability, and quality.
Domestic sourcing and reshoring tailwinds creating new onshore opportunities.
Risk Factors
Competitive pressure from large continuous manufacturers; small-batch niche must sustain >20% product margins.
Sales cycles can run 6–18 months, delaying revenue conversion and cash generation.
Customer concentration at individual sites can cause volume swings; one site acted as an “anchor.”
Import pressures in tubular markets can compress pricing despite DFARS rules.
Buyback execution constrained by liquidity and blackout windows, limiting pace toward 1 million authorized shares.
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Capital Allocation
06/05/2018 Is the potential bolt-on acquisition in Metals or Chemicals?
I cannot disclose that yet. We expect to share more within a couple of weeks. It is a business we know well, fits strategically, and we can hit the ground running with it.
06/05/2018 Is the potential acquisition related to recent public equity purchases?
No, it is totally unrelated.
06/05/2018 Will you continue buying stainless steel puts given your outlook on nickel?
In Q4 last year we reviewed our hedging policy after two years of layering monthly puts. Since then, under the Board’s three-level decision process, we have not added new layers and have no open puts forward. As nickel prices rise, we may consider layering again, but currently we have no exposure and have not paid premiums for new hedges this year.
12/08/2018 How much CapEx is required to increase galvanized production by 45%?
Not as much as expected. We approved recent projects involving tooling and exit system work. On the galvanized side, required CapEx is under $400,000. For ornamental tubing, about $250,000 of tooling will handle different shapes. It is a fairly negligible investment to support that growth.
11/11/2018 Any thoughts on pegging acquisition share prices above market levels, like $22–$22.5, to justify value to sellers?
Charles, that makes sense. We’ve done transactions in the $5–6 million EBITDA range, including $30 million-plus with earn-outs, where the stock component was not critical. Last year we nearly closed a deal involving $17–18 million of Synalloy shares that would have been immediately accretive.
At that time, we considered whether it made sense to value our stock above its then-trading price given the contemplated transaction. So yes, that approach can be reasonable, depending on the specific deal.
03/09/2020 Can Synalloy manage its $78.6M debt with only $1.4M cash while still reinvesting?
This year we cut capital expenditures by about $2 million, but kept all high-return projects, such as Munhall, which will show benefits starting in Q4. We expect $3 million in tax refunds this year, plus typical inventory reductions in the second half, particularly Q4, which will free working capital.
We feel somewhat thin on the asset-based lending facility, where we ended Q2 at $6–7 million, versus a preferred $10–12 million. That was due to a conservative March metals inventory valuation. With nickel prices and surcharges moving up since August, we expect the October revaluation to restore some borrowing capacity. Ideally, we want $10–12 million in capacity to comfortably fund operations and critical CapEx.
09/11/2020 With market cap at $50M and debt over $70M, will that affect refinancing of the credit line expiring December 2021?
We’ve had preliminary conversations with Truist and they remain very positive about renewal. We expect both the asset-based line and the term debt to be renewed before year-end.
11/05/2021 Is 2021 capital expenditure still projected at about $4 million?
Yes, though it may come in slightly lower. We are reassessing every CapEx dollar. Approved or budgeted does not mean we will spend it; projects must be incremental to business growth. For example, a potential Munhall expansion was avoided by reorganizing existing space, which cut significant CapEx. The team is being pushed to maximize current assets, and if an investment is not revenue producing, we review it multiple times before proceeding.
09/08/2021 Are capital expenditures still expected to be $4 million or less this year?
Yes. We are tracking significantly below that number, and I anticipate we will be nowhere near the $4 million we originally projected.
09/08/2021 Could you explain the $632,000 cash expense related to the proxy contest?
That was a reimbursement for Privet and UPG from the proxy contest. We placed highly qualified directors on the Board and brought in Chris as CEO, which has proven to be a good investment for shareholders. The Board gave it some time to evaluate and determined it was worthwhile. This expense was accrued in the second quarter and will be paid in the third quarter.
09/08/2021 After the third quarter, does that close the books on the proxy contest expense?
Correct.
09/11/2021 What will Synalloy do with the 55 acres of land it now owns?
I am not a fan of sale-leasebacks. Owning the assets provides greater flexibility for capital investments and expansion without being constrained by a landlord. While ownership allows future capital flexibility, DanChem’s model of partnering with OEMs who invest capital in the facility has worked well, and we plan to replicate it.
09/11/2021 With liability earn-outs ending in January 2022, freeing about $1 million per quarter, how will that cash be used?
We plan to use it to pay down debt.
09/11/2021 Is there a preference between chemicals and metals given your market share in metals?
We remain optimistic and would give the same answer.
09/11/2021 How do you think about leverage, given this exceptional quarter may not be sustainable?
We expect to predominantly use debt in the near term, given its cost, while maintaining a prudent leverage level. The target is dynamic and considers cyclicality in certain earnings streams and near-term cash flow expectations. We feel confident in our cash generation, and our first use will be debt reduction. However, for larger opportunities outside our leverage comfort zone, we would consider equity if returns exceed the cost.
09/08/2022 How do you view the current stock price and potential buybacks?
The stock price is a complete joke. When you search Synalloy’s ticker, it shows an irrelevant peer group , comparing us to Cleveland-Cliffs makes no sense. For instance, Northwest Pipe trades around $31 despite having more net debt, lower earnings, and smaller revenue, yet a market cap above $300 million. It’s frustrating internally, but we remain focused on delivering solid results every quarter, building the right team, and making prudent, shareholder-accretive investments.
08/11/2022 What message does the share buyback send?
We believe it signals confidence in our business and value. Repurchasing shares demonstrates discipline and commitment to shareholders. We appreciate your support and feedback on that front.
09/05/2023 Do you have a target debt level in mind?
No, not specifically. We expect to pay down additional debt through free cash flow generation, but there’s no arbitrary target. Our goal is to make working capital as efficient as possible, and that will be an ongoing effort. If high-return opportunities arise, we’ll allocate capital accordingly, being mindful of our debt cost, equity position, and other potential uses of capital.
09/05/2023 Could the share buyback program become more aggressive, perhaps through a tender offer or higher volume?
Everything is on the table. Q1 activity was constrained by regulatory restrictions tied to our delayed audit filing. Now that we’re back to a regular reporting cadence, we’re freer to repurchase shares within SEC limits. We’ll continue to be as aggressive as possible under those rules.
08/08/2023 With John’s departure, how are you approaching his replacement, through recruitment, or potentially via M&A?
We’re actively searching for an individual. We have a very capable interim leader doing a great job and uncovering immediately accretive opportunities. That said, we have strong views on where we want the Specialty Chemicals segment to grow, and we won’t wait for an acquisition to fill the role. We want to recharge the team’s energy sooner rather than later.
08/08/2023 How are you assessing the residual value of the Munhall facility, and how could that influence your cost guidance for the year?
We’re exploring all options to minimize business impact and maximize residual value. That includes selling or moving equipment, liquidating assets, subleasing the facility, or even potential joint ventures. It’s classified as discontinued operations, and we want an exit that extracts the most value possible.
08/08/2023 Would the higher end of costs reflect reclaiming the least residual value from Munhall or extending the process longer than planned?
Yes. The facility has been an anchor since it was acquired, and our goal is to cut that anchor as soon as possible.
08/08/2023 What obstacles prevented the company from buying back more shares in Q2?
We were late filing our 10-Ks in Q1, which delayed putting our 10b5 plan in place during the open trading window. Although that delay didn’t carry into Q2 directly, it prevented us from utilizing the entire quarter to repurchase stock. Once the 10b5 was implemented and the window reopened after Q1 results in mid-Q2, we were able to buy back shares daily. As long as we file on time and have new 10b5 plans ready for open market purchases, we expect no legal or mechanical barriers to being in the market consistently.
08/08/2023 Does publicly signaling your intent to acquire chemical assets inflate asking prices since sellers know you need to grow that segment?
No, I don’t think so. It’s mostly a supply and demand issue. We’ve demonstrated we’re willing to walk away from deals that don’t make economic sense. Transactions happen when both buyer and seller see fair value, and that’s where we focus.
28/03/2024 Does the $72 million debt reduction provide flexibility to reinvest?
Yes. Reducing debt gives us flexibility to refocus on fundamentals across both segments and to reallocate capital toward internal and commercial growth. With a clean balance sheet, we can reinvest strategically to stabilize and strengthen the business. While M&A remains a longer-term goal, near-term priorities are improving predictability and operating performance.
28/03/2024 Could delaying acquisitions cause missed opportunities if chemical market valuations rise?
That’s a fair concern, but stabilizing the foundation first will generate a much higher return on investment when we eventually pursue M&A. If we acquired a company today, we wouldn’t capture the full benefit of potential synergies. Fixing the base business now ensures future integrations will be far more accretive.
28/03/2024 Is the $10 per share range still seen as an attractive buyback level given current conditions?
We avoid being dogmatic about valuation levels. Markets and business performance are dynamic, and we constantly reassess based on real-time data. When we initiated buybacks two years ago, shares traded around $10–$11, but we’ve since purchased at an average in the high $9s, reflecting our view of intrinsic value being well above that. We’ll continue acting opportunistically where buybacks remain a highly accretive use of capital.
28/03/2024 With no debt, does the company have financial flexibility for future actions?
Yes. With the balance sheet clean, we now have meaningful firepower and flexibility to deploy capital where it creates the most value.
28/03/2024 What level of financial capacity do you have for a larger buyback program?
That’s what we’re currently evaluating. The priority is ensuring operational strength first, since any analysis is only as good as its inputs. We’re being deliberate and prescriptive in this assessment, and it’s an active topic at the Board level. Our goal is to have confidence in the data driving those decisions and to act when conditions are right. Having no debt isn’t necessarily the most optimal position if shares trade below intrinsic value and we operate in a fragmented, value-add industry. We see strong opportunity ahead but don’t want to look back 12–18 months from now having missed our chance to allocate capital effectively.
06/08/2024 Following the $2.8 million Munhall asset sale and $3.6 million cash at June 30, will the company let cash build until a use is determined?
Yes. At the business level, we’re strategically reviewing potential reinvestments. If accretive, margin-building opportunities arise, we’ll consider them, but none have yet. Inorganic growth is closer on the horizon than before. For now, there’s no specific allocation; we’ll let cash build while focusing on cost efficiency.
We feel very good about liquidity. Having some excess cash doesn’t change our disciplined approach , every deployment must meet our thresholds. Still, it’s encouraging to see cash building and enterprise value growing.
12/11/2024 Is the specialty chemicals M&A environment currently robust, and how is pricing?
We’re just starting to open that door again. Activity levels are picking up, and we’re getting new looks at opportunities. It’s still too early to tell on pricing, but the environment appears increasingly active.
12/11/2024 Could the new credit agreement lead to larger share buybacks?
It’s possible. That wasn’t something we were initially targeting, but with improving operations and additional liquidity in the stock, we have more flexibility. We view the stock as undervalued and have been buying back shares. Market limitations are easing somewhat, giving us more options going forward.
04/03/2025 Is the planned buyback of 1 million shares over two years realistic given historical repurchase rates?
It sets parameters for what we’re aiming to do, not a strict timeline. We have authorization to purchase up to that amount, giving us flexibility to act when appropriate. Timing depends on trading volume and blackout windows that limit when we can repurchase. As long as we believe buying back our shares is a good use of capital, we’ll find ways to execute.
13/03/2025 Why do customers choose Ascent over competitors?
Purposeful agility. For example, we received a call on Good Friday from a customer with a critical problem. Over that weekend, our team developed new formulations, shipped samples, and within a week we were qualified. Field trials followed within another four weeks, and we solved the customer’s issue. As a result, we earned a new piece of business. We want to replicate that responsiveness repeatedly.
13/03/2025 What prior experience do you and Ryan share, and what lessons did you bring to Ascent?
Ryan and I have worked together for roughly ten years across several companies. Our last joint experience was at Clirion in Charleston, South Carolina, which was losing substantial amounts annually and was near bankruptcy. Within four years, we turned it around. The main lesson was that success is all about people , attracting, developing, and retaining top talent is a genuine competitive advantage. We brought that mindset to Ascent from day one, made key leadership changes, and purposefully invested in SG&A. The strong 2024 results reflect the quality and empowerment of the people we’ve added.
13/03/2025 What is Ascent’s path to profitability while maintaining a growth mindset?
We made major cost improvements in 2024, and sustaining those gains is step one. On growth, we’ve pivoted to both organic and inorganic opportunities. Organically, we have significant unused capacity that we can activate without heavy incremental cost , our team is actively pursuing margin-accretive business to fill it.
Inorganically, we’re evaluating selective M&A. We’ll be deliberate and disciplined, focusing only on acquisitions that align strategically. For example, last year we walked away from a deal late in diligence when it didn’t meet our standards. That’s the type of discipline we’ll continue to apply in creating shareholder value.
13/03/2025 Where do you want to see Ascent in three to five years, and what are the key inflection points?
We were brought in to build a Specialty Chemicals business, so our focus is on optimizing that portfolio. One major inflection point will be exploring strategic exits for the stainless steel tubular segment. It won’t be a fire sale , it’ll be done purposefully to maximize value while sharpening our focus.
Beyond that, we plan to fully utilize our existing chemical capacity, driving growth that could take the segment north of $100 million in revenue with a strong margin profile. Over time, we’ll divest non-core assets, reinvest proceeds into Specialty Chemicals, and aim for 15–20% margins. 2024 was the clean-up year, 2025 will be about portfolio streamlining and disciplined M&A, and beyond that, we’ll keep trading up into higher-margin, lower-volume businesses to build a more profitable, focused enterprise.
28/04/2025 What were the highlights from the Bristol Metals sale and how does it position Ascent going forward?
The Bristol Metals sale closed on April 4, 2025, generating approximately $45 million in proceeds. That leaves ASI as our only remaining stainless steel tubular business, which produced about $27 million in revenue last year. This divestiture advances our goal of becoming a pure-play specialty chemicals company while strengthening our balance sheet. We now hold roughly $55 million in cash and are focused on high-return capital deployment through share repurchases and selective bolt-on acquisitions.
Ascent today operates as a specialty chemicals platform centered on solving customers’ toughest technical problems. Our value lies in developing customized formulations, scaling them from lab to production, and maintaining long-term, sticky customer relationships. The sales cycle can range from one month to as long as eighteen, depending on complexity, but that investment of time yields durable, high-margin partnerships.
28/04/2025 What’s the rationale behind potentially acquiring a chemical distribution company?
When we compare trading multiples, specialty chemical manufacturers typically trade at 8–10× EBITDA, while distributors trade closer to 10–12×. Many distributors already sell products we either manufacture or have the technical capability to produce ourselves. Acquiring a distributor would therefore allow us to capture margin through vertical integration, improve asset utilization, and spread our fixed costs over a larger revenue base.
28/04/2025 What’s the plan for the remaining tubular business?
We’re actively marketing that last stainless steel asset. It currently generates roughly $4–6 million of adjusted EBITDA, and we expect it to trade in a similar 4–6× range.
05/05/2025 How do share repurchases fit into your capital allocation strategy given company size and stock liquidity?
It’s always an option. We’ve been actively buying back shares and have discussed larger programs at the board level. For now, we’re evaluating how the market reacts to our portfolio optimization before committing further.
We’re in a strong balance sheet position and want flexibility for organic growth or additional repurchases if the stock remains attractive. There’s uncertainty in the market, so we prefer to stay patient and preserve optionality. Liquidity limits how aggressively we can buy, but we’ll keep repurchasing shares opportunistically while exploring all other uses of capital.
05/05/2025 Where does M&A fit in your overall strategy? Do you see the need for a transformational deal?
What we’re not going to do is buy something just for the sake of doing a deal. We’ll stay highly disciplined in what we pursue. In the fourth quarter of last year, we had an LOI in place and reached the diligence phase but saw issues that didn’t align with our expectations. We tried to adjust valuation but couldn’t reach agreement, so we walked away rather than chase a deal for ego’s sake.
We’re going to remain selective and mindful of our current challenge , underutilized assets. The last thing we want is to acquire another property that compounds that issue. Discipline and fit remain our top priorities.
05/05/2025 What is your plan for the remaining tubular asset?
Ideally, we’d like to see it transact this year, but we’re not in a rush. The asset we sold earlier took significant time and effort from the team, so we’re being patient. The remaining asset is performing well and isn’t a distraction.
We estimate it generates about $4–6 million in adjusted EBITDA annually, and we expect it to trade at roughly four to six times that. On the high end would be ideal, but even the low end is acceptable. The business is well run, and the focus remains on shifting entirely toward specialty chemicals.
05/05/2025 What should investors expect in terms of CapEx spending going forward?
Over the past three to four years, we’ve averaged $1–3 million per year, and that’s a good range to expect going forward. That covers maintenance, safety, and compliance needs based on our current asset base.
Occasionally, we’ll have project-specific CapEx if a team proposes an initiative with a clear return on investment , for example, an additional $500,000 for a high-return project. Those are one-off opportunities, but the $1–3 million range is our steady-state expectation.
12/05/2025 Could ASTI still be sold in 2025?
Yes, we are always evaluating options to monetize the value of all our assets.
12/05/2025 Can this growth be achieved with existing capacity and minimal capital expenditures?
Absolutely. Our run-rate capital expenditure has been between $1 and $3 million annually for the past four years, and we believe that’s a reasonable assumption going forward. Current asset utilization is very low, providing ample runway for organic growth.
12/05/2025 Was the Q1 buyback limited by the Bristol transaction?
During Q1, we executed repurchases within the parameters of the existing buyback program. With the Bristol sale completed, our financial flexibility has improved, and we’ll consider expanding activity moving forward.
12/05/2025 Does the expanded February 18 buyback allow purchases at higher prices and larger amounts?
Yes, though daily limits still apply regarding the number of shares we can buy at specific price levels.
06/08/2025 Has the executive management equity compensation plan been presented to the board, and were Q2 share repurchases linked to that program?
I’ll answer in reverse. The roughly 6% share buyback was not related to any equity program. It reflected our belief that the company is undervalued and will increase in value in the near term. Regarding the equity plan, Ryan and I already participate in an existing program, and we’re finalizing a broader plan for senior leadership with support from the compensation committee. It will be updated and refreshed each year.
06/08/2025 Has this year’s equity plan tranche already been finalized by the board’s compensation committee?
Yes, that’s already been settled. The current discussion relates to the 2026 tranche.
06/08/2025 Have you adopted a more disciplined approach to acquisitions compared with prior deals like ASTI and DanChem?
Yes, that’s absolutely the plan. We’ve reviewed several properties, entered LOIs, and walked away when valuations didn’t align. We won’t pursue deals just for the sake of doing them. We want to execute the right deals for shareholders, starting small to prove we can capture growth and cost synergies before pursuing larger opportunities. Expect smaller transactions first.
06/08/2025 Will large-scale share repurchases continue, or will buybacks be smaller going forward?
We’ll continue operating under the existing buyback agreement and evaluate opportunities with the board. We have a fair amount of dry powder and intend to use that for both share repurchases and inorganic growth. It’s not an “or” decision; it’s an “and.”
06/08/2025 How do you weigh M&A opportunities versus share buybacks as you approach full utilization of existing capacity?
From an inorganic standpoint, we expect potential acquisitions to trade at roughly six to eight times EBITDA. We aim for the lower end of that range after accounting for synergies, given our current valuation and strong organic opportunities. We’ll pursue M&A deals that fit within that range while continuing opportunistic share buybacks. Early acquisitions will likely be small to ensure focus remains on organic growth. We’ve walked away from deals that didn’t make sense and will stay disciplined, targeting opportunities closer to six to seven times post-synergy.
06/08/2025 What multiples would you expect to pay pre- versus post-synergies for acquisitions?
Pre-synergy, we wouldn’t expect to pay above eight or nine times earnings. Post-synergy, we aim to bring that closer to six to seven times. We’re not in a position to overpay given our idle capacity and the returns we can achieve internally. We’d rather invest where we can deliver high certainty and strong organic performance.
26/08/2025 What are you known for in the market?
Historically, we were known for custom or toll manufacturing , the guys who’d take almost any job, even at poor margins. That lack of strategy showed up in our financials. Over the past year, we deliberately walked away from bad business below variable cost. The result is a stronger reputation, better project opportunities, and early recognition as a disciplined, selective operator. Investors remember we overpaid for DanChem in 2021, but we’ve learned from that and are committed to disciplined acquisition and integration going forward.
From a customer’s perspective, the process starts when they bring us a technical challenge. Our team evaluates how to modify or create formulations to meet their needs, typically leading to long-term manufacturing relationships. We also assist early in a product’s life cycle when clients lack capacity, or later when they outsource mature products.
On the M&A front, our strategy mirrors that thinking , identifying “orphan” product lines we can integrate efficiently. Two years ago, we did about $3–3.5 million in the scale-up space but lost focus. We plan to rebuild and excel there, supporting projects from lab work through pilot scale to ongoing production. Eventually, as customers internalize production, volume may leave us temporarily, then return when their capacity maxes out. That’s why growing our proprietary product sales matters: it stabilizes the cycle and improves margins.
03/09/2025 What M&A synergies or bolt-on capabilities are you targeting?
From a market-synergy standpoint, we remain aligned with our four key pillars: oil and gas, water, HI&I (household, industrial, and institutional), and coatings. Within those areas, we look for complementary capabilities , for instance, rail access. None of our current assets have it, and adding that would open an entirely new portfolio of opportunities.
Likewise, we currently operate primarily with stainless-steel reactors, which work well for many customers. But if we added glass-lined reactors, that would unlock another class of opportunities. It’s about adding tools to our toolbox so we can serve customers more broadly and efficiently.
16/09/2025 What milestones should investors track over the next 12 to 18 months to gauge progress toward your 50% adjusted EBITDA margin target?
First, a transaction involving the Munn Hall property would be one key milestone. Second, continued organic growth, expect to see upward sales momentum as we move into 2026. Third, watch for inorganic growth opportunities that may emerge during this period.
19/09/2025 How will you deploy the remaining $60 million in cash after repurchasing shares, and where does M&A fit?
We bought back 6% of our outstanding shares, reflecting confidence in our team and trajectory. For the remaining $60 million, priority one is internal, fence line opportunities with compelling ROI, for example customer growth that needs incremental equipment. We are also pushing plant automation in batch manufacturing to improve cost, reliability, and quality.
On M&A, we are active but disciplined. Late last year we were under LOI for a very small transaction, less than a $5 million valuation. Diligence surfaced issues, we attempted to retrade, and walked away when terms did not make sense. We pass targets through strategic filters, market fit, geographic logic, and capability enhancement. We will not buy simply to get bigger.
Competitive Advantage
11/05/2021 Could Synalloy manufacture galvanized solar torque tube like the new Kentucky mill?
Our galvanized business is a narrow niche, and most margin comes from specialty stainless pipe and tube, as well as heavy-wall products. Our focus is on areas where we can make the most money and deliver quickly, rather than broad galvanized products.
04/03/2025 Has domestic sourcing of critical ingredients positioned the company with a competitive advantage?
From a raw material sourcing standpoint, our exposure is very minimal, and our team has ensured we aren’t dependent on offshore sources that could be affected by tariffs or supply chain disruptions. Beyond that, there’s a significant opportunity to benefit from the domestic manufacturing renaissance as customers bring sourcing back onshore and streamline supply chains. These changes take time, but we’re already seeing promising new opportunities as a result.
13/03/2025 How do you maintain focus and retain key talent during the turnaround?
Maintaining focus is critical. When you try to solve every problem at once, you risk stagnation and burnout, even if the effort level is high. Our goal is to channel that energy toward the right priorities and move the business forward deliberately.
Equally important is retention. Every bit of our success comes from our people, and turnarounds demand grit and persistence. We have an incredible team that has worked tirelessly to stabilize and rebuild the company. Keeping them engaged and motivated is essential because there’s still plenty of work ahead.
28/04/2025 What has been the biggest obstacle to launching and scaling your own branded products?
Initially, the biggest hurdle was the lack of a professional sales organization. We’ve since rebuilt that function completely, adding both traditional and technical sales roles. Our technical salespeople work directly with customers to identify problems and define tailored chemical solutions, while our R&D teams validate those solutions through lab-scale testing.
This is a far more technical sale than our prior business. Previously, we sold largely commoditized products like bleach, where success was about market share and volume. Today, we sell high-value, customized chemical solutions that require collaboration and technical expertise. That’s also why we’re considering distribution acquisitions , those businesses typically have deep, sticky regional customer relationships that can accelerate our reach and product adoption.
28/04/2025 How do you monetize your customer relationships after delivering these tailored solutions?
Historically, we had very few long-term or contracted relationships. As we’ve transitioned to solving customers’ most complex problems, we’ve built recurring revenue through multi-year supply agreements. Just last week, we announced a four-year contract expected to add about $750,000 of adjusted EBITDA annually. That’s roughly 10% of last year’s total EBITDA , meaningful for a company of our size.
The commercial team has also been disciplined in pricing, ensuring we extract fair value for our products while maintaining customer satisfaction. We continue to invest in both classical and technical sales talent to deepen those relationships and expand recurring revenue streams.
26/08/2025 What technologies or products are most important to your business?
Our surfactants and foamers are used across diverse applications , water treatment, coatings, and more. Chemistry isn’t a one-trick field; a single formulation can serve multiple markets. We hold hundreds of base products that we customize to solve specific customer problems, turning commodity sales into higher-margin, stickier relationships.
Until now, our R&D was mostly “research and duplicate,” staying within IP limits. We’ve just hired an R&D leader to expand those capabilities and drive innovation. He joins next Tuesday, marking the next step in building a true development engine within Ascent.
03/09/2025 What is your customer profile and how do specialized offerings strengthen relationships?
In the first half of the year, we’ve had tremendous success partnering with small to midsize customers who need strong technical support. Larger specialty chemical manufacturers often turn them away or push them to distributors lacking the technical depth to solve their complex problems. Ascent steps in with both small- and large-scale support, which has generated strong demand.
For example, on Good Friday, a prospective customer called with an urgent issue. Over the weekend, our lab created three sample solutions, which they validated within a week and field-qualified within a month. Because we operated at their pace and solved their problem, we secured $5 million in net new business with margins above 20% EBITDA. We want to replicate that success repeatedly.
16/09/2025 In the current pricing environment for specialty chemicals, how much pricing power do you have, and are you seeing competitive pressure from larger peers?
Last year, one of the levers we pulled was price, to ensure we captured appropriate value for our products and services. In cases where we couldn’t raise price, we simply walked away, which improved overall EBITDA and gross margins. We’ve successfully passed along price increases while staying conscious of competitive pressures and remaining market-competitive.
Compared to larger peers who run continuous manufacturing plants focused purely on lowest cost per pound, we stand out by solving customer problems. When customers call saying, “I need help,” we engage directly. Those interactions often yield more margin-accretive, longer-term relationships because we address unmet needs that large producers cannot.
19/09/2025 How sticky are the dedicated, customer-specific plants and what do contracts look like?
Dedicated facilities are multi-year by design. We have multi-decade relationships with those customers and do not see that changing. Earlier this year we signed a new four-year agreement, which we disclosed in a press release. It produced a $750,000 annual price pickup. We are not just maintaining agreements, we are upgrading business quality through better contracting, market research, and understanding the relative value we create in our customers’ processes.
Operations
06/05/2018 Why did Palmer Tank revenue decline year-over-year?
No, it was not weather related. Two large customers in the Permian had been scheduled to take tanks in February and March but, due to bottlenecks mainly tied to labor, they could not take delivery. They did, however, take all of those tanks in the first week of April, which drove April sales at Palmer to just under $4 million.
06/05/2018 How much revenue was pushed from Q1 into April at Palmer?
About $1.3 million to $1.4 million in tank value was delayed from Q1 into April.
06/05/2018 How do you protect against higher raw material costs in Palmer Tank pricing?
Our bids are valid for 30 days. If we get any protection on carbon steel purchases, we extend that protection to our customers, but currently the bid window is 30 days.
12/08/2018 Is chemical segment revenue and 12–13% margin sustainable in the back half?
That’s right. We like the product mix in the pipeline and expect volumes to increase in the second half. This will drive favorable overhead absorption, especially at CRI, which still has excess capacity. Bringing more volume into that facility provides strong leverage on operating income and EBITDA.
12/08/2018 When will Bristol’s Q2 price increases show up in revenue?
That is correct. Because of backlog, those increases would not have been reflected in second quarter revenue. The benefit will begin flowing through in the back half of the year.
12/08/2018 What is happening in the specialty pipe division?
We believe you mean the seamless pipe and tube business. We acquired it in November 2014 for about $28 million. It performed well early, slowed during the oil and gas downturn, yet still delivered margins comparable to our other businesses. In the last year, performance has been the strongest in its history, with expected 2018 EBITDA margins near 25%.
This investment is yielding a significant return in 2018. The key is maintaining high inventory levels. That business is designed to turn inventory only once a year, serving distribution houses that prefer faster-turning stock. With more than $20 million of inventory supported, it is a very strong contributor to our metals segment.
11/11/2018 Despite reports of a Permian slowdown, your backlog remains strong. What activity are you seeing at Palmer?
We see no slowdown. Some E&P firms may be holding back until takeaway capacity arrives in 2019–2020, but we still have plenty of inquiries. Most orders are for larger tanks with higher selling prices, and activity remains robust.
Our main issue is labor. In 2014, most labor came from near the Andrews facility. Now about half is transient, from New Mexico and other parts of Texas. We’ve leased housing to accommodate them, but turnover is high. Productivity suffers when trained workers leave after six months, though demand remains strong.
11/11/2018 Can you pass along higher labor costs to customers next year?
Yes, we can pass on wage increases, and our backlog tank prices are higher. The larger challenge is productivity loss from turnover, which disrupts efficiency even more than wage inflation.
03/05/2019 How were Palmer’s Q1 orders with backlog at $15 million?
Order rates were good, but throughput improved after removing bottlenecks, particularly in paint blast. Pay rate adjustments also reduced turnover. Throughput was strong and April will likely set a revenue record for the storage tank business.
03/09/2020 How long do new chemical products take to impact earnings?
The process can take up to a year. We track products through four phases: Phase 1 is the idea, Phase 2 involves initial customer testing, Phase 3 is small-scale production, and Phase 4 is full production with visibility on pounds and impact. Samples are tested by both our customers and their customers, which lengthens the cycle.
Our Cleveland, Tennessee plant runs at 85% capacity, limiting new product introductions there. CRI runs at 50% capacity, leaving ample room for new reactor and blend products. These carry high contribution margins since they require no added labor. Although timing is uncertain, we like the current pipeline and cost initiatives, which supported significant EBITDA gains despite a 1% sales decline.
03/09/2020 Is hand sanitizer still shipping at two trailers per week?
Volumes have dropped from the early Q2 spike, but we have active bids with new customers who did not participate in the initial surge. We expect it to remain a solid contributor to chemicals.
09/11/2020 How is Synallow’s BioLube ECO-7 being accepted in the marketplace?
Our chemical business has long produced lubricants for the textile industry, with multiple products fitting that description. I haven’t heard specific feedback suggesting this product extends beyond one customer. Typically, such products are tailored to a specific customer, but we can look into details and provide a follow-up.
11/05/2021 Can you quantify delays in production and deliveries, and were they metals only or both segments?
Delays were across both metals and chemicals. Like chip shortages in autos or appliances, raw material inputs constrained us. We cannot provide a precise number, but delays contributed to a higher backlog that should flow through Q2, Q3, and Q4. Logistics issues, such as trucking shortages, also weighed on results.
11/05/2021 Will new VP Tim Lynch’s operational improvements show up quickly or take time?
It is a process, but Tim has already made contributions. We brought in new talent, including continuous improvement and SOP specialists to boost throughput and efficiency, and a business development leader to streamline sales. These moves set us up for long-term success, enabling the sales team to grow the right kind of business with the margins we want.
11/05/2021 Will Synalloy supply stainless pipe for a customer’s new furniture line?
We aim to sell as much pipe and tube as possible, though I cannot identify that customer. The constraint is not demand but execution: producing on time, at the right cost, with the right equipment, while maintaining positive margins. This year is about delivering reliably, pricing correctly, setting SOPs, and structuring sales incentives for the markets we want to win.
09/08/2021 In the Metals segment, is there still room for more improvement in getting product delivered on time?
Yes, there is definitely room for more improvement in flow-through and efficiency. Our supply chain team is working well, coordinating inbound customer orders with mill production and finished goods. We are probably in the sixth or seventh inning of putting a great process in place, and we are significantly further along than last quarter. On-time delivery is now at its highest level in at least one year, so we are making strong progress in delivering product on time to customers.
09/08/2021 Does that business carry a high EBITDA margin?
It has a relatively healthy EBITDA margin. We are also improving the supply chain by refining the number of SKUs, classifying items into A, B, C, D categories, and implementing a new inventory program. This has already reduced inventory days significantly and better aligned supply with demand.
09/08/2021 Beyond leveraging corporate overhead, what synergies exist between Chemicals and Metals?
There are synergies on the expense side, such as uniforms, raw material inputs, and logistics. I also like Chemicals because it should carry a healthier margin than Metals, and we are working to capture that.
09/11/2021 How will you mitigate margin compression if steel prices fall?
Margin impact in the metals business mainly comes from being in a long or short inventory position. Our goal is to transition into a true mill structure, producing welded pipe and tube directly to customer orders. Historically, the business built inventory ahead of demand, which created price risk. Producing to order will reduce commodity exposure and support more consistent margins.
09/11/2021 Does producing to order put you at a disadvantage if competitors hold more inventory and deliver faster?
That is a good question. We sell primarily to OEMs and stocking distributors. We avoid competing with distributors, which happens if we build inventory. Stocking excess inventory forces us into weak pricing with master distributors. Our throughput is aligned with customer need, not speculative stocking, which protects our relationships.
08/11/2022 Will corporate expenses remain elevated through Q4 before declining in 2023?
Yes. We’ve invested heavily in processes, procedures, and staff upgrades. We’re already seeing benefits such as reduced healthcare costs through improved negotiations. While expenses are slightly elevated now, I expect cost savings heading into 2023.
08/11/2022 Will being a supplier of choice help with larger diameter pipe demand going forward?
Yes. We’ve spent about 18 months catching up. Our on-time delivery improved from the 30% range to over 80%, addressing a major historical issue. Previously, contractors couldn’t rely on us to deliver full orders for major projects. Through open houses, we showed over 100 customers our full process, from coil to finished goods, and how we ensure quality and timely delivery. That transparency and execution are now driving significant new business wins.
08/08/2023 Did you experience similar destocking pressures in the Chemicals business, particularly in Agriculture and Personal Care, or were you insulated due to positioning or lead times?
The primary issue on the chemical side was site-specific. One customer making a product in the personal care space saw significant volume declines, which impacted us. We’re working to refill that volume. Two of our sites are performing above expectations, while one site is currently acting as an anchor on performance.
08/08/2023 When you lose demand from a large customer early in the year, how do you adjust your planning for that asset?
It becomes a commercial effort of turning over more stones. The equipment is state-of-the-art and dedicated to that customer, so we’re working with them to understand their reduced volume needs. Meanwhile, we’re negotiating contract terms that could allow us to backfill that unused capacity with other customers. We’re nearing the tail end of those discussions and expect to make progress using that volume for others.
08/08/2023 Given the volume headwinds, are you comfortable with current raw material inventory levels on a mark-to-market basis, or will there be margin impacts through year-end?
On the chemical side, I don’t foresee any issues. On the tubular side, margins are being negatively impacted as we burn through inventory purchased last year at peak prices, both nickel surcharges and raw materials. We’ve worked through most of that in the first half, with a small amount remaining in Q3. Last year, our working capital position wasn’t optimal, and we didn’t forecast the customer loss or the sharp fall in surcharges.
08/11/2023 How much self-help leverage do you have over the next few quarters assuming no market recovery?
We feel confident we can return the chemical side to prior levels of profitability within the next few quarters without relying on a strong market rebound. The environment is difficult, but many factors are within our control. Moving from a mid-single-digit EBITDA margin back to around 10% is achievable through internal initiatives, and further improvement toward the mid-teens range should come as market headwinds ease.
08/11/2023 How are you balancing efforts to secure new chemical business versus maintaining existing customer relationships during destocking?
We are pursuing both aggressively. Customer engagement is very high, though results vary across our three facilities. Some are outperforming while one is underperforming, which we are actively addressing with signs of progress. At the same time, we’ve achieved several encouraging wins elsewhere in the chemical business. After reviewing this with Brian, we’re optimistic about 2024.
08/11/2023 Has Brian provided any early perspective on procurement and inventory management or lessons from recent years?
Yes. He’s already identified opportunities and assembled a team to address them. Brian is very aggressive, well connected in the chemical sector, and has already brought in several strong hires. We’re upgrading talent weekly, and after recent meetings with Brian, Ben, Bill, and the Board, we’re all confident in what he’ll deliver.
08/11/2023 Are you still seeking key leadership hires in the steel business?
Yes. We’re always evaluating leadership needs and open to bringing in the right talent to strengthen and grow the business.
28/03/2024 How close is the tubular segment to sustainable profitability after the restructuring?
We’re focusing on two or three main areas within Tubular. The first is cost reduction, there’s still significant cost that can be eliminated and returned to net income without compromising safety or compliance. We expect benefits in the near term. The second is core product line management, where we’re analyzing which products are profitable and which are not. That review should conclude in Q2, with follow-up actions shortly thereafter.
08/05/2024 Have customer relationships been affected by recent operational changes, staffing adjustments, and product portfolio optimization?
There has been some churn, but the vast majority of our customers have been with us for decades and remain incredibly loyal. We’re deeply appreciative of those relationships and confident they’ll continue long term as we keep expanding the customer base.
12/11/2024 Was the margin improvement at Ascent Chemicals driven by self-help or new contracts?
It’s a combination. We started aggressively reducing costs across the enterprise and have done so sustainably. In addition, we’ve improved the overall quality of our book of business. So it’s really all of the above.
04/03/2025 Any updates on leasing or selling underutilized properties like the Cleveland, Palmer, or Munhall sites?
In Tennessee, at our chemicals facility, we had a smaller warehouse that we managed to sell through our leasing provider around the second or early third quarter. That’s completed. We also have an active sublease with Palmer. The real focus now is on the Mont Hall site, where we’re actively working to find a permanent solution for that asset.
13/03/2025 What have you been focusing on operationally over the past year?
We’ve been very intentional about where we spend our time, allocating much of it to fixing the company’s core foundation. You can see that through our 2024 results, where we improved significantly in both gross profit and adjusted EBITDA across both businesses.
13/03/2025 What was your approach to restructuring the company’s two segments?
There’s no natural reason for a steel business to sit next to a chemical business , the structure was confusing. Our experience is in Specialty Chemicals, so we started by reassessing both segments from the ground up. On the chemical side, we knew from our Clirion turnaround that strategic sourcing can unlock major value when executed well. It’s not just about buying raw materials; it’s about aligning sourcing strategy with planning, scheduling, and analytics.
When we arrived, it was clear we didn’t fully understand our own capabilities, customers, or end markets. That lack of visibility made improvement difficult. Operational inefficiency meant sales reps were bogged down in logistics and customer-care issues instead of selling. We rebuilt the team, refreshed talent across sourcing, planning, and analytics, and brought in external experts to help evaluate plant-level capabilities. That deeper operational understanding is now driving meaningful change.
13/03/2025 How did you integrate Ascent’s three chemical plants into a unified business?
When we arrived, each plant operated independently and inefficiently. Our priority was to centralize key functions and bring in people who could view the business holistically. That gave us better visibility and allowed more strategic conversations with customers. For example, we began tracking every dollar spent at the plant level , a basic “checkbook” exercise that revealed blind spots.
We also built an FP&A function for the first time. Previously, financials only went upward with no accountability at the plant level, so no one truly “owned” a number. By redesigning budgeting for 2025, we made it more efficient and impactful. The broader goal was cultural: shifting from a volume mindset to one centered on profitability. We brought in new talent, emphasized margin over tonnage, and prepared the company for disciplined, profitable growth.
28/04/2025 Can you describe the company’s current scale, capacity, and key performance indicators?
We were founded in 1945 and employ roughly 274 people across three manufacturing assets in Tennessee, Virginia, and South Carolina. The plants are operating at about 50% utilization, leaving substantial organic growth potential with minimal capital needs. Our specialty chemicals segment generated about $80 million of revenue and an 8% adjusted EBITDA margin last year. The goal is to lift that margin to around 15%, which is typical for the industry.
We’re filling underused capacity with higher-margin branded and proprietary products instead of low-margin contract manufacturing. In 2023, about 90% of our business was custom manufacturing and only 10% branded. That mix has already shifted meaningfully, improving both pricing and predictability. Capital intensity remains low since our production processes are non-corrosive, and we maintain strict standards for safety and reliability.
28/04/2025 Why were so many of your branded products sitting idle before 2023?
Before 2023, Ascent operated primarily as a contract manufacturer. The model was reactive, waiting for the phone to ring and producing to customer order, while a portfolio of owned formulations and intellectual property sat unused. When we came in and saw that “war chest” of underutilized products, it represented a major opportunity. That discovery drove the rapid shift from a 90/10 custom-to-proprietary mix to roughly 75/25 within one year.
28/04/2025 How did legacy assets shape your current capacity and strategy?
Over a century ago, our first chemical holding, Manufacturers Chemical, was built to serve the textile industry. Our South Carolina plant was designed around that sector, but as textiles left the U.S., it left behind substantial excess capacity. To fill the gap, prior management adopted the contract manufacturing model, renting out equipment to others. We’re now redefining those same assets with purpose-built, branded production focused on solving customer problems and generating higher-margin, recurring revenue.
26/08/2025 Are you still marketed under the same name?
We’re marketed as Ascent. There was a branding change several years ago; the old ticker is gone, it’s now just ASNT. All our external marketing collateral has been completely rebranded.
26/08/2025 Do you have branded products?
Yes, we do. For example, if you need a corrosion inhibitor for downhole oil and gas applications or a defoamer for paints and coatings, we can supply it. These are functional additives, not consumer products you’d find on a retail shelf. We’re fundamentally a specialty raw material supplier, not a consumer packaged goods company.
26/08/2025 How large is your sales team?
Not large enough. We’ve just hired a coatings technical sales representative who starts next week, and we’re close to finalizing an offer for a cleaning (HI&I) specialist. Combined with our new R&D hire, that will give us the right commercial and technical balance for the near term.
26/08/2025 Do you already have the rest of the team in place?
Yes, we’ve built a strong core team , what I call a really good band. Restructuring meant selling assets and reducing headcount, but that was necessary to reset. Now the challenge shifts to executing organic growth, which we’ve done before.
26/08/2025 How do you reach customers and manage sales channels?
We sell directly to formulators, paint manufacturers, and oil and gas service companies, not through distributors. That avoids channel conflicts and leaves room to acquire a specialty distributor if we choose. Most of our sales are direct, technical, relationship-based engagements.
03/09/2025 How does specialization factor into sales and marketing as you expand?
Specialization is central to how we go to market. It begins with understanding the customer’s technical requirements and ensuring we have the right people to collaborate directly with them in solving complex problems. We just hired a new R&D leader , his first day was today , to strengthen that capability.
We now have market-focused sales resources in oil and gas and coatings, and we’re building that same focus within HI&I. The goal is a disciplined, cross-functional team that aligns technical depth with market specialization.
19/09/2025 What does your current operating model, “chemicals as a service”, mean in practice?
Our model centers on meeting customers where they are and serving them how they need to be served. For some, that means formulation or technical support to solve complex problems; for others, differentiated supply-chain solutions or simply reliable delivery of what they need, when and how they need it.
Rather than forcing customers through a traditional, outdated value chain, we tailor solutions to their specific objectives. Whether the critical moments are in development, commercialization, or manufacturing support, our aim is to stand alongside them and create value in those moments that matter most.
19/09/2025 Can you walk through your sales process from lead generation to commercialization?
Marketing conducts market research on what we have on the shelf, matches products to applications and target customers, and hands prioritized leads to inside sales. Inside sales engages prospects to qualify need. Technical sales then works opportunities through the pipeline: pre-qualification, sampling, customer lab qualification, field testing for real-world efficacy, contracting and negotiation, then commercialization. It is a lengthy process, which is the good and bad news. Once you are in, and you perform, you are in.
19/09/2025 What sales-cycle timelines do you target for new wins?
It is opportunity dependent. For custom manufacturing, I would be delighted with six to twelve months. For proprietary products, three to six months would be ideal.
19/09/2025 What were your turnaround milestones, and where did you outperform?
The first three items were people, people, people. Get the right team in place and give them runway. A key lever was strategic sourcing. Consolidating buys and executing a sourcing strategy delivered a 20% reduction in raw material cost, better than my initial expectation.
Data and systems were next. We had two ERPs and no reporting repository, which we addressed. We have now converted to one ERP. Over this weekend, the team completed the cutover. On Monday morning we logged in and could collect cash, issue purchase orders, post production, record shipments, and create invoices.
Competition
12/08/2018 Did South Korea already reach its steel quota and what about India?
Yes, South Korea has tapped out its quota and cannot ship additional product into the US this year. Regarding India, you may recall we succeeded in dumping charges about a year and a half ago, resulting in duties from 7% to triple digits, plus the 25% tariff. Even so, there is evidence of continued dumping below cost, so we may revisit that. Bristol Metals has not yet enjoyed any major benefit from tariffs, though we expect improved volumes in the second half with Korea out of the market.
12/08/2018 What percentage of imports come from South Korea?
I do not have that number immediately available. If you call me after the meeting, I will pull it up and share it with you.
12/08/2018 Is South Korea one of the largest US exporters?
Yes. By volume they are second only to Taiwan.
03/05/2019 How were March and April BRISMET order trends?
Orders have picked up recently. In April, we booked about $9 million of stock buys, and we are quoting on several larger opportunities. Imports were strong in January, mostly from South Korea, but domestics gained share and we also picked up share.
03/05/2019 Were Korean imports back in the market until their quota?
That’s right. They shipped heavily in the first three or four months of last year and again in January. If the trend holds, they’ll be out of the market again by June.
09/11/2021 How will European tariff rollbacks on steel and aluminum affect Synalloy?
We do not expect any impact. There is not much heavy wall material coming in, and the volumes are small, about three million tons, with nothing tied directly to our end markets.
08/11/2022 Are increased imports this quarter a problem for future quarters?
It’s something we’re watching closely. We can’t control import flow, and it has increased significantly, especially in smaller diameter tubing. For large diameter tubing, approvals for infrastructure projects have slowed, but demand remains strong. The issue is getting projects through the system. Imports have surged over the past 12 months versus the prior 3–5 years, and our tubular segment head, Tim Lynch, is active on the industry import committee. If imports continue unchecked, it could become a broader challenge.
08/11/2022 Isn’t the infrastructure program meant to promote U.S.-made products?
Yes. The DFARS requires steel to be made, melted, and produced in the U.S. for large-scale projects. However, imports still flood into ornamental, mechanical, appliance, and automotive markets. Competing with extremely low-cost product from Taiwan, China, Korea, and Vietnam remains difficult.
08/08/2023 Are there any industry efforts underway to address import pressures in the current steel demand environment, and are you involved?
We’re active in the Committee for Pipe and Tube Imports, a collaboration of domestic producers assessing countries dumping material into North America. A solo trade case is costly, so the committee is surveying interest in pursuing joint actions. We’ve done this before and are exploring all options. At the same time, we’re evaluating whether importing ourselves could make sense for smaller-diameter products if we can do it cheaper than producing domestically. Imports might actually be an opportunity if we view them strategically.
13/03/2025 Who do you typically compete against in the market?
We face a broad mix of competitors. Although we’re small, we often go up against major players like Lonza and Stepan, multi-billion-dollar companies. We can compete effectively because we’ve optimized our cost base, built exceptional agility, and assembled a strong team over the past year.
28/04/2025 Can you provide examples of your specialty products and outline your competitive landscape?
Our total addressable market is about $9.2 billion, though we currently participate in a smaller slice of that. Roughly 30% is household, industrial, and institutional (HI&I); 30% is personal care; 20% is oil and gas; and the remainder includes paints, coatings, and other smaller markets. One good example is our oil and gas segment, where we manufacture corrosion inhibitors to improve flowability. In 2023 we had virtually no revenue in that vertical. After hiring an experienced technical sales lead, we were called by a major customer on Good Friday 2024 to solve a problem. Within days, our team produced and tested three formulations, and within a month they were field-tested and adopted. That resulted in roughly $5–6 million of entirely new business because we solved a critical customer issue.
05/05/2025 How do you view competition given your smaller scale and broad product range? How do you win against larger competitors?
From a toll manufacturing standpoint, competition is intense, especially on price. Unless you’re handling multi-reaction, highly complex chemistry, it’s generally a commoditized offering where customers are renting out capacity. We can win selectively, but it’s not our intellectual property, it’s theirs, so differentiation is limited.
As we shift toward branded products, our batch manufacturing model allows us to be scrappy and successful with small to mid-tier customers. We can’t match the economies of scale of large continuous manufacturers running 24/7, but when customers need smaller batch quantities or custom formulations, we win consistently.
12/05/2025 Is the ASTI business a more attractive acquisition target now than six months ago?
The demand environment remains soft, even though we saw some pickup in Q1. Market conditions are still relatively muted. Regarding tariffs, we are getting additional looks from customers, but it’s not a dramatic change in activity. The climate for an ornamental stainless domestic manufacturer has not materially shifted.
03/09/2025 How do you view the current pricing environment and your pricing power?
Historically, our pricing was inconsistent and lacked a clear rationale. Over the past year, we’ve become far more strategic about how we price and position our offerings. By deselecting poor-quality business , some even priced below variable cost , and strengthening pricing discipline elsewhere, we’ve improved margins and competitiveness.
We intend to be responsible stewards of pricing. Just because we can use price as a weapon doesn’t mean we’ll give away value. From a macro perspective, we’re not counting on a market recovery; our growth will come from disciplined execution and self-help, not external tailwinds.
Growth
06/05/2018 Are lighter Chemicals margins due to a permanent mix shift?
No, not permanent. Margins move around. We have higher-margin business in the pipeline for both MC and CRI, and expect improvement over the next few quarters. The road construction product announced recently was fast-tracked and is already generating strong orders, with major shipments scheduled for May through July.
06/05/2018 Are there start-up costs for the new road construction product?
No. We do not need additional equipment or personnel, so it will have an immediate positive impact on margins.
06/05/2018 Has last year’s new Chemicals business ramped as expected and met profitability goals?
Yes, it has performed well. Volumes are at expected levels and the customer is very happy with quality.
12/08/2018 Can you discuss the galvanized acquisition, its markets, and growth potential?
The galvanized business sells into several end markets. One is the intermediate bulk container (IBC) market, which uses galvanized steel skeletons around chemical totes. We supply tubes for those machines and have large IBC customers. We also serve the garage-door framing market and multiple road construction applications. Our IBC customers would prefer to buy domestically, and they have asked us to increase tonnage by about 45% annually above current levels.
We operated this business for over a year under the Italians, so we know the personnel and processes well. Several Bristol sales team members previously sold galvanized and ornamental stainless tube, so we are comfortable with both production and sales. It is an important organic growth initiative we will focus on in the coming months.
11/11/2018 How is the expansion opportunity with integrated bulk container customers in galvanized progressing?
We continue working with several customers to increase tonnage for their integrated bulk containers. We’re also making good progress with galvanized products in road construction.
03/05/2019 Why was Chemicals revenue and profit down year over year?
Revenue had organic growth and profits were up after adjusting for a legal payment received in Q1 2018. We are adding biocide capacity at CRI for existing and a new customer. At MC, we are bringing in additional blending business to use excess capacity.
09/11/2020 After Palmer, is about 80% of revenue from markets not tied to oil and gas?
That’s roughly correct. Our specialty pipe and tube business in Houston has exposure to midstream energy and offshore, though offshore is very slow. Bristol Metals has downstream energy exposure, mainly to infrastructure spending on LNG, petrochemical, and chemical operations, which is less volatile than upstream markets.
11/05/2021 Will Synalloy benefit from the $35 billion Safe Drinking Water Act funding?
Yes. On the chemical side, water treatment overlaps strongly with our business, and we are investing R&D there. On the pipe side, replacing aging infrastructure creates demand, as safe drinking water is universally valued. We see opportunities to develop new products and expand our share of this market.
11/05/2021 How is the strengthening of the chemicals sales team progressing?
I do not know the chemicals business as well as metals, but I believe it holds tremendous long-term value. I am directly involved in building a strategic plan to position the brands and sales effort more aggressively. There is significant opportunity, and we will find the right way to capture it.
09/08/2021 Is the backlog still growing?
Backlog is very robust.
09/08/2021 Can you discuss the specialty pipe and tube master distribution business, mainly in Houston and Ohio?
That business distributes heavy wall seamless pipe and tube. In Houston, the first half of the year was impacted by rebounding oil demand, but we are now seeing a significant pickup, especially on the Texas distribution side. The Ohio and Midwest market has been very robust, with demand from hydraulic applications, construction equipment, high-pressure uses, valves, and fittings. Overall, this business is benefiting from a rebounding economy and seeing strong tailwinds.
09/08/2021 How does backlog compare to the March quarter?
Backlog is up, particularly in the customer segments we are targeting going forward. We are shifting the mix of the end-use profile to where we want backlog delivered.
09/11/2021 With the acquisition increasing chemical segment revenue by a third, will earnings become more stable for the whole company?
We see significant margin growth potential in the chemical segment, which is less commodity driven in pricing. This gives us a longer-term growth projection and balances our overall portfolio.
09/11/2021 DanChem is performing very well this year. How sustainable is this and what were margins and revenue in 2019–2020?
I don’t know the exact figures. However, DanChem has been a growth story since its private equity ownership, which brought in new leadership to turn it around. With the processes and investments made, both top line and margins have grown over the past three years, and we believe that growth is sustainable.
09/08/2022 Can we expect chemicals to become a larger share of revenue over time?
Yes. DanChem is driving that shift in mix, and as we continue to expand our specialty chemicals business, the revenue composition will keep evolving accordingly.
08/11/2022 How is diversification into personal care and specialty chemicals progressing?
On the personal care side, we’re expanding within the household segment by applying our reaction capabilities to new opportunities in that sales funnel. Construction adhesives and sealants remain very strong areas of demand, and we’re securing large specialty chemical production contracts with customers in those sectors.
08/11/2022 What progress has been made since the DanChem acquisition?
A year in, we’re seeing meaningful expansion from that deal. We gained high-caliber customers through DanChem, and have been qualifying additional facilities in South Carolina and Tennessee to meet their needs. Each new formula and site requires customer approval, but as we complete that process, we’re expanding relationships, for example, serving customer X not just from Danville but now also from Fountain Inn and Cleveland, Tennessee. The geographic reach and customer penetration are both increasing.
08/11/2022 Chemicals represented 27% of revenue this quarter. Is that a strategic focus?
Yes, absolutely. That mix is a high watermark and reflects a deliberate focus from Ben and me. We’re pursuing both organic growth and selective strategic acquisitions to further strengthen the chemical segment.
08/11/2022 Is the goal for tubular and chemical EBITDA to be equal within two years?
Yes. Tubular will continue to have ups and downs, but chemicals are much steadier. The chemical business is highly technical and sticky, with long sales cycles and a focus on quality, lab work, and approvals. Once approved as an outsourced specialty chemical partner, relationships last for years rather than single purchase orders.
09/05/2023 With Munhall and chemical slowdowns, do you see sales growth potential in the near future?
Yes, stabilization is occurring through Q2. We saw early signs in April and expect more improvement through May and June. Growth depends on the division and comparison period. On a year-over-year basis including Munhall, growth is harder to see, but excluding Munhall and looking sequentially, some areas are expanding. We plan to disaggregate results more clearly, excluding Munhall, to provide apples-to-apples comparisons. Overall, we’re targeting stabilization and a return to growth.
08/11/2023 Hypothetically, if the tubular business had entered 2023 in ideal shape, which areas would you lean on in this macro environment, and which would you adjust?
There’s significant opportunity in tubular, but performance varies by unit. Specialty Pipe and Tube is performing exceptionally well with strong demand and growth prospects. In contrast, the Bristol operation, serving the oil and gas and large-diameter pipe markets, missed sales targets despite robust demand. We’re improving the team and processes there. It’s a solid business when run properly, but it’s not yet where it needs to be.
28/03/2024 Where is the low-hanging fruit within Ascent’s branded products portfolio?
In custom and pulp manufacturing, sales cycles typically take 6 to 18 months from prospect to commercialization. Branded product cycles are much shorter, often one to three months. Our existing portfolio spans diverse markets including water treatment, oil and gas, and textile chemicals. We’re reinvigorating these areas through increased and reallocated SG&A spending to target new opportunities. This should drive stronger margins and more predictable results as we gain control over our own branded sales.
28/03/2024 What is the easiest go-to-market path for branded products given existing customers?
It depends on the market. For our initial focus areas, there’s minimal overlap with existing customers, which avoids channel conflict. That’s where we’re concentrating first, and we expect to report favorable results from these efforts in upcoming quarters.
28/03/2024 Are branded products the same as the proprietary products developed in recent years?
Correct. They refer to the same higher-margin, company-owned product initiatives we’ve been developing.
28/03/2024 Can branded or proprietary products be expanded without significant R&D investment?
Yes. Within our current portfolio, we already have a set of branded products that can reach a wide range of markets without heavy R&D spending. These are existing products suited to existing markets and applications, allowing us to expand efficiently without major development costs.
28/03/2024 Can the current management team create lasting value using existing assets, without acquisitions?
Absolutely. Ryan and I have worked together for years, including in prior turnarounds, and I firmly believe we can build something special with the assets we have today. I’m a strong believer in organic growth and in unlocking the enterprise’s full potential by assembling top talent that challenges and improves one another. We’re building that momentum now, and it’s exciting to see the early results and what’s ahead in the near term.
06/08/2024 How are branded product sales in chemicals progressing?
Good. We’ve started to build meaningful traction and are nearing run-rate volumes on the initial two sponsoring opportunities. Based on our Q2 R&D activity, we’re heading in the right direction. There’s still work to do on the rest of the Tennessee portfolio, but we’ve got the right people and we’re hyper-focused on execution.
06/08/2024 The $10 million in new Q1 wins and additional Q2 activity , was that from increased demand or a more effective sales team?
Those were net new selling opportunities that weren’t in the pipeline prior to Q2. They continue to build month over month toward full run-rate volume, revenue, and EBITDA inside of Q3. We’re pleased with the progress and traction. There’s a lot more to do, but it’s being driven by hyperfocus and an incredible team.
12/11/2024 Could Ascent participate in Department of Defense initiatives to develop domestic chemical manufacturing?
Yes. There’s an influx of onshoring opportunities beginning to emerge, and following the most recent election cycle, I expect we’ll see even more of those.
04/03/2025 How has the newly launched $2.5 billion ingredient cleaning portfolio been received by the market?
We launched the portfolio last month and held a launch event at a cleaning conference in Florida. Not many potential customers even knew we were in the space, so awareness was the first win. The reception was very positive, and the team came away with a number of new opportunities they’re now pursuing, which we hope to convert into sales soon.
13/03/2025 What is the total addressable market for Ascent’s businesses, and how large can the company become?
Our Specialty Chemicals business operates in two main buckets. The first is custom manufacturing, where customers come to us to produce materials they don’t want to invest capital in themselves. The second is our branded products, which we both manufacture and sell directly. We saw strong traction in 2024 with these branded products. The total addressable market for our branded lines in the U.S. alone is approximately $9.2 billion. Considering our current total company revenue of about $178 million, there’s significant room for growth and market share capture ahead.
28/04/2025 Why should investors consider Ascent today?
We’ve built a strong, cohesive team that executes quickly. Ryan and I have worked together for a decade, and we’ve surrounded ourselves with capable, results-driven leaders who’ve delivered a major turnaround in a short period. We’re thinly traded and undercovered, but investor awareness is improving, and the business is well-positioned for growth. We’re still early in the journey, with significant upside ahead.
06/08/2025 How do you assess your near- to mid-term new business pipeline over the next 12–18 months?
We work on that pipeline every day. As I mentioned earlier, our selling project pipeline increased by about $25 million over the last quarter. That growth is spread across four to five different market segments and includes both product sales and high-value custom manufacturing opportunities.
06/08/2025 What catalyst could drive a higher valuation for the company given chemicals’ more stable earnings profile?
I think it’s three things: growth, growth, and growth. Beyond resolving the lingering Munhall issue, our focus after stabilizing the foundation last year has been on both organic and inorganic growth. The team has made enormous progress over the past several quarters, and the momentum this past quarter has been incredible. We’re very excited about the future, the work the team is doing, and the value proposition that continues to resonate with our customers.
26/08/2025 Have you achieved organic growth in prior roles?
Yes. In our previous company, revenue grew from roughly $100 million to $300 million before we sold it. The difference here is complexity , we now serve about 170 customers with hundreds of SKUs. Managing that diversity requires precision, but the team is ready. The proof will come through execution.
16/09/2025 With your specialty chemical focus now fully in place, what are the key drivers that will take you from $80 million to $120–130 million within the existing asset base?
When you look at the U.S. specialty chemical market, it’s an enormous $220 billion industry. Narrowing it to the products we manufacture, it’s about a $9 billion market. With our current top line at $80 million, there’s clearly plenty of room to grow around the fringes. Roughly 30% of that market is coatings, another 30% HI&I (household, industrial, and institutional), 20–30% oil and gas, with the balance spread across smaller segments.
Our participation strategy aligns well with those four pillars of opportunity. We’re resourcing appropriately and laser-focused on those segments, building a strong, high-quality sales pipeline. This growth does not depend on new equipment; the capabilities we already have within our asset base can support that $120–130 million target.
16/09/2025 Does most of the new business come from existing or new customers? How do you engage with new customers, and how many salespeople do you have?
The answer is both. About 75% of first-half project wins came from existing customers, while 25% were from new ones. We still have significant runway to grow share of wallet within our existing base and continue expanding with new customers.
Last year, we strengthened SG&A by rebuilding key functions like marketing and launching proprietary branded products tailored for oil and gas, HI&I, coatings, and adhesives. Our go-to-market strategy has improved significantly. We’re seeing new inquiries from inside sales outreach, digital channels, and trade shows. Our visibility in the market is higher than ever, generating opportunities we hadn’t seen before.
19/09/2025 How is Ascent progressing on its marketing and sales strategy, and what differentiates your business model?
We’re seeing strong progress in our marketing and sales strategy and are beginning to drive real growth. Unlike many chemical manufacturers, toll processors, or distributors, we provide a comprehensive suite of solutions, everything from product and process development to scale-up, blending, reactions, warehousing, logistics, and regulatory support. In essence, we are not only a manufacturer but also a service provider with the responsiveness of a specialty distributor. Over the past six months, we’ve added new customers and deepened relationships with existing ones, particularly among small and mid-sized clients that large chemical producers often overlook. Those large players run continuous processes and avoid smaller custom projects; we embrace them. This approach creates sticky customer relationships and produces demand that is more predictable, ratable, and margin accretive.
Our model is also structurally differentiated. In 2023, about 90% of sales came from toll or custom manufacturing, which meant making customers’ products in our equipment with limited pricing leverage. After reviewing our dormant product portfolio, we revitalized it, by year-end, product sales grew to 25% of revenue, improving both pricing and gross margin. We also operate a “buy, build, and operate” model, running dedicated plants for specific customers, two of our five plants already function this way. Today we have roughly 200 employees, 170 customers, and three sites across South Carolina, Tennessee, and Virginia. About 95% of raw materials are domestically sourced, insulating us and our customers from tariff volatility. Our chemicals segment currently generates around $75–80 million in annual revenue, with significant headroom to grow within our existing assets.
19/09/2025 Which markets does Ascent serve, and where are you focusing future resources?
Historically, Ascent participated in over 15 end markets without clear focus. Last year, we reassessed where we have the right to win and concentrated on five pillars: oil and gas; coatings, adhesives, sealants, and elastomers (CASE); household and industrial cleaning (HI&I); and adjacent water treatment applications. The U.S. specialty chemical market is roughly $200 billion, and through the lens of products we currently make and sell, our addressable market is about $9 billion. Roughly one-third of that lies in CASE, one-third in HI&I, and another third in oil and gas or energy-related uses, with the balance in textiles, water treatment, and pulp and paper. While we remain open to customer-driven opportunities outside these focus areas, this strategy now guides how we deploy resources and capital.
19/09/2025 Which sectors are you leaning into, and how do margins compare?
We are leaning into four pillars: coatings, adhesives, sealants, elastomers, oil and gas, HI&I, and the water adjacency. Oil and gas was available to us, but a year ago we had close to zero participation, so there is strong runway. HI&I also has runway, though momentum is earlier. We remain disciplined on resource allocation. At the core, we prioritize opportunities with compelling margin profiles.
Financials
12/08/2018 How much higher are conversion margins on specialty alloys?
It depends on the alloy. For commodity alloy products, conversion margins range from $0.95 to $1.15 per pound. For specialty alloys, depending on the type, margins can reach about $3 per pound.
12/08/2018 Are net margins expected to rise in the second half?
That’s right.
11/11/2018 Is the new 5 million-pound Chemicals customer on the tolling side, and what revenue or margin will it generate?
Yes, it is tolling. The customer is covering about $0.5 million of CapEx over time, built into the tolling price. They provide the raw materials, so we don’t earn margin on raws. It’s essentially a straight tolling deal with minimal labor required, and it will be materially profitable for CRI.
11/11/2018 Can you comment on EBITDA from the new galvanized and ornamental steel business?
We shouldn’t provide specific EBITDA given the small number of customers in that market.
11/11/2018 Was EBITDA from the galvanized and ornamental steel business positive in the quarter?
Yes.
03/05/2019 Does the $44 million BRISMET backlog include Galvanized?
It should include all of BRISMET, which includes Galvanized.
03/05/2019 What is BRISMET backlog excluding Galvanized?
I have not broken that into components. I’ll have to dig in and provide that answer after the call.
03/05/2019 Was backlog under $30 million in March excluding Galvanized?
We’ll confirm and provide the appropriate answer. I believe it has always included all of BRISMET.
03/05/2019 Did December 2018 EBITDA guidance assume a $4 million inventory loss?
We don’t forecast nickel profits or losses. On a comparable basis, 2018 EBITDA was about $28 million excluding inventory profits. The 2019 forecast was $34 million excluding inventory profits or losses.
03/05/2019 How does steel pricing, beyond surcharges, affect inventory gains or losses?
Pricing was more aggressive in Q1 due to extra product in the channel and consolidation among master distributors, plus some speculative buying late last year. Commodity stainless pipe prices are lower than last year with surcharges down, but stronger sales of special alloys offset that with better margins.
03/05/2019 What was the specialty alloy sales mix in Q1?
On a sales basis, about 21%. On a pounds basis, about 12%.
03/05/2019 Was Palmer profitability up year over year?
Yes, quite a bit.
03/05/2019 What is the Chemicals division margin target?
EBITDA margin is expected to be 10% to 11% for the full year. Gross margin figures are not handy and we can provide those later.
03/05/2019 Did ASTI have an inventory mark-to-market loss and was it adjusted in EBITDA?
Yes. There was about a $1.3 million inventory adjustment charge. Our adjusted EBITDA includes $1.35 million related to that.
13/08/2019 Why was the tax rate so high in Q2 and the first half?
With income figures being relatively low, discrete items of only a few hundred thousand dollars had a significant impact on the effective tax rate. If income and tax had been higher at the statutory rate, the impact would have been spread over a much larger base. That is essentially the explanation.
03/09/2020 Why was the 10-Q delayed and how are the issues being resolved?
The 10-Q will be filed later today after market close. Item four addresses the issues you raised. First, there was no lawsuit. The referenced investigation, conducted by an independent law firm, is complete with no evidence of intentional misconduct, bad faith, or criminal acts.
We will report a material weakness in internal controls. Four deficiencies were identified that, while not individually material, aggregate to a weakness. Details and remediation steps are in item four of the 10-Q. That section also explains the corrective actions underway.
03/09/2020 Was the investigation related to Palmer accounting?
Yes, it was categorized as a whistleblower complaint tied to Palmer accounting, but not from a Palmer employee. The investigation confirmed no wrongdoing, bad faith, or criminal acts.
03/09/2020 Has Palmer been written down fully, and could proceeds from a sale be recaptured?
Yes, this is Sally. Palmer has been written down to the value associated with ceasing operations and actively marketing the business.
03/09/2020 Will remediation actions restore good standing with accountants?
Absolutely. There has never been a question on the reported numbers. The issues were primarily internal control matters, and the remediation steps are in progress.
03/09/2020 Press release shows tangible net worth of $67.4M, or about $7.40 per share. Is that accurate?
Yes, with 9,058,000 shares outstanding, that calculation is roughly correct.
03/09/2020 What was the $1.1M gain on investment securities?
From time to time, we take small positions in public companies we view as potential acquisition targets, always under 5% to avoid filings. We’ve done this three or four times in the past 10 years. In this case, one of those companies had a substantial move in the second quarter, creating a $1.1 million mark-to-market gain. We have since sold the entire position, with net proceeds of roughly $4.4–$4.5 million.
09/11/2020 Was the October inventory revaluation completed to increase credit capacity with higher nickel prices?
The revaluation did not happen in October due to COVID-related delays. We are now in the process of getting a new valuation and expect higher inventory prices with nickel increases.
11/05/2021 Will inventory gains and surcharges start to flow through soon?
The way we look at the P&L is not about being a slave to input prices or surcharges. We need to make money in any environment and manage inventory through cycles, aligning production with end-use demand. That said, we are passing more pricing through to customers in real time, which will lift margins.
11/05/2021 Won’t the lower-cost inventory from Q3 and Q4 eventually flow through?
Yes, you will see that flow through. Some pricing arrangements create a lagging effect, with Q4 impacting Q1 results. Under certain contracts, pricing changes cannot be updated as quickly as the market moves, so you will see it reflected across quarters this year.
11/05/2021 Did the chemicals business miss its internal margin target, and what is that target?
We do not give guidance until all metrics are aligned. We do have internal gross and net margin targets, and results came in below expectations. The outcome reflects business mix, mainly tolling versus direct to manufacturers. There is growth in the market we are addressing.
11/05/2021 Was the chemicals shortfall primarily a mix issue in Q1?
Yes, it was mainly attributable to mix.
11/05/2021 Why was metals ASP down year-over-year despite higher base metal costs and surcharges?
Certain one-off projects, like pipelines or offshore wells, require specialty grades and affect average selling price. More broadly, our galvanized business is priced lower per pound than 304 or 316 alloys. In Q1, 304 volumes increased, 316 declined, and galvanized rose significantly. The change is driven by product mix, not uniform pricing.
11/05/2021 Did the [indiscernible] earnout liability end in Q1, and will that impact the bottom line?
Yes. Remaining earnouts are only ASTI and galvanized, with about a $300,000 bottom-line impact. This is a meaningful improvement compared with prior years.
09/08/2021 With material price inflation, can you continue passing increases to customers without hurting margins?
Yes. We have tested pricing elasticity more on the Metals side than Chemicals. We were initially slow to raise prices in Chemicals but have since caught up. Customers are not pushing back significantly, as their main concern is securing product to meet their own commitments. It is a unique market environment, but so far, we have successfully passed on price increases.
09/08/2021 What were BRISMET and Munhall volumes on a year-over-year basis?
For the Metals segment as a whole, pounds were up 21% year-over-year.
09/08/2021 Are you on LIFO or FIFO accounting?
Technically, we are on neither. We use standard costing for inventory.
09/11/2021 Chemicals showed 11% adjusted EBITDA margin versus DanChem’s 18%. How long until integration lifts margins closer to 18%?
We are already working on it and have identified opportunities for accelerated margin improvement. Some investment is needed in engineering and capabilities that DanChem has, and we will leverage those resources. Rather than starting from scratch, we expect a faster ramp toward higher margins.
09/11/2021 In the DanChem acquisition, did you acquire the corporate entity or just the assets?
We acquired both the assets and the entity.
09/11/2021 Did Synalloy assume any environmental liabilities in the DanChem acquisition?
We conducted full diligence on the environmental side, and no unexpected liabilities came up.
09/11/2021 Corporate expense rose by $650,000 sequentially. Why?
That was mainly severance expenses for some prior executives.
09/11/2021 Why was the provision for inventory losses $1.9 million this quarter?
It reflects scrapping aged inventory produced under the old methodology of making pipe without customer orders. This weighed on earnings as the material was unsalable.
09/05/2023 Was the $13 million debt reduction in Q1 mainly due to working capital release from Munhall or other sources?
It was a mix of factors. A large portion came from working capital, but not all from Munhall. It was a broad-based effort to align working capital with more normalized revenue levels. We’ve made good progress, but there’s still opportunity to improve, particularly with Munhall. We can continue selling and repurposing inventory there to reduce replenishment costs across the tubular business.
09/05/2023 How are you addressing BDO’s note on deficiencies in internal controls, especially for financial reporting, inventory, revenue, and technology?
We’ve been focused on timely filings, and after joining at the end of Q1, I (Bill Leary, CFO) re-engaged our previous consulting firm to develop a remediation plan. These issues take time to fix, and we’re approaching them methodically throughout this year. Some involve IT systems and procedural changes, while others require staff training and process improvements. I’ve successfully led similar remediation efforts before, and we have a clear plan to execute this one effectively.
08/08/2023 How are internal controls progressing?
A lot better now than with our prior auditor. This quarter went very smoothly. While no process is ever perfect, we now have the communication and systems in place to be far more efficient in preparing and filing reports, ensuring a systematic review process and timely feedback.
08/11/2023 What drove the goodwill impairment? Was it linked to a specific customer loss or a broader review of the environment?
It was primarily related to the Danville operation, not the loss of a specific customer. The impairment reflected a normalization of customers’ estimated annual volumes going forward.
28/03/2024 Did your proactive inventory cleanup contribute to margin pressure in Q4?
Yes. We reviewed our inventory throughout the year and made a deliberate effort to either commercially move older items or write them off. This cleanup caused some margin compression in the fourth quarter. Going forward, Brian and I will reassess inventory needs as we adjust commercial strategies, but the Q4 margin impact was directly tied to that cleanup.
28/03/2024 Was Q4 chemical segment performance driven more by price or volume?
Volume played the larger role in the fourth quarter compression. We did experience some pricing headwinds, but the primary driver was lower volumes.
08/05/2024 Chemicals operating expenses have been stable for two years , is that due to strong variable margin management, with future improvement driven mainly by fixed cost absorption and mix?
Absolutely. As volumes increase, we gain cost absorption benefits, but we’re still actively reducing raw material inputs and overhead costs. That work continues, and we’re not yet seeing the full benefit of improvements already implemented. The team remains focused on pulling every lever to enhance profitability.
08/05/2024 How did price versus volume trend in each segment, and how are prices tracking relative to raw materials?
From a tubular standpoint, prices were depressed, but we expect a slight uptick in Q2. In chemicals, there’s significant volatility due to product mix, so I’d caution against overinterpreting short-term movements. As we implement product mix changes, average selling prices should gradually rise, becoming more predictable and stable over time.
08/05/2024 Inventory stabilized around 120 days in Q1 , is that the target level, or do you expect further reduction?
We still see opportunity to right-size inventory in both the chemical and tubular segments. There’s meaningful potential to optimize levels further, and I’d say we’re really just getting started on that process.
06/08/2024 With the labor and material costs removed, will margins improve sequentially going forward?
Yes, absolutely. We’re going to see that margin improvement carry through. We’re not done yet; we’re continuing to evaluate our product portfolio and mix, and we keep finding ways to further optimize costs.
12/11/2024 Was the $5 million increase in cash mostly from Munhall asset sales or operations?
It’s a mix of both. The predominant driver of the cash build was operational efficiencies, including monetizing slow-moving inventory, and a portion came from Munhall asset sales. From a pure asset standpoint, our main focus remains on right-sizing inventory and monetizing trapped cash, but that’s largely where we’ll generate cash outside of normal sales.
04/03/2025 With the lower revenue base, can you still deliver similar gross profit or margin profiles?
Yes, we’ve been very successful in driving aggressive cost reductions and demonstrating our ability to sustain those gains. Along with the pricing and product mix optimization actions, we’re heading in the right direction.
04/03/2025 Cash increased by $7.5 million from Q3 to Q4. What drove that growth?
We continue to optimize idle and stagnant inventory, which was the largest driver of cash in Q4. Increased efforts on collections, inventory management, and payables management also improved our cash conversion cycle, pulling almost two weeks of cash back into the year. These combined efforts continue to turn that cycle faster and generate more cash each quarter.
04/03/2025 Can chemicals margins improve further or at least remain at current strong levels?
Yes, there’s potential for continued margin improvement as we grow branded product sales. Last year we implemented targeted price increases and achieved them successfully. I don’t expect much more of that in 2025; we’ll monitor what happens in the raw material markets.
13/03/2025 Ascent is still relatively small. Can you confirm your 2024 results?
Yes, for the full year 2024, we generated approximately $178 million in revenue.
13/03/2025 Can you walk through Ascent’s 2024 financial performance and key drivers?
2024 was a year of stabilization. I joined late 2023 to focus on Chemicals, then stepped into the CEO role shortly after, and Ryan joined soon after as CFO. Our top priorities were cost control and organizational stabilization across both segments. We aggressively tackled costs, strengthened strategic sourcing, and secured better raw material pricing. We also reduced labor and overhead by roughly 19–20% across the enterprise. These savings weren’t short-lived , we sustained them throughout the year and into 2025.
We also took a hard look at our product lines. In some cases, we were producing and selling at a loss, which simply isn’t sustainable. Where we could secure proper pricing, we did; where we couldn’t, we exited. That explains some of the year-over-year top-line compression. The markets were soft in 2024, but we’re not relying on a recovery , 2025 will be another year of disciplined self-help, only now we’re shifting our focus toward growth.
13/03/2025 What were the key results of these changes in 2024?
The top line compressed slightly, which we expected, but profitability improved. We were fine with that trade-off , we’d rather see better business flowing through our plants than chase unprofitable volume. By year-end, we had refreshed the organization, strengthened the team, and positioned ourselves for both organic and inorganic growth. The table is now set for 2025 to be a year of execution and expansion.
28/04/2025 What were the key operational and financial improvements in 2024?
We delivered a $19.9 million turnaround in adjusted EBITDA, significant gross margin improvement, and strong working capital management, generating $17 million in cash from operations. We also sold non-core equipment and completed four consecutive quarters of earnings growth, setting a solid foundation for 2024. Every improvement came from internal execution rather than market tailwinds.
Our assets currently operate at roughly 50% utilization across three facilities, meaning we have large untapped capacity for organic growth with minimal capital needs. Earlier this month, we closed the sale of Bristol Metals, one of our largest stainless steel holdings, for about $45 million. With roughly $50 million of cash on hand, we’re executing a share buyback program while selectively pursuing bolt-on acquisitions aligned with our goal of becoming a pure-play specialty chemicals company.
26/08/2025 What is your largest product by annual revenue?
Our largest product generates around $7 million per year, with the next closest near $4 million. We’ve worked hard over the past couple of years to reduce customer concentration risk.
16/09/2025 How much of the gross margin improvement is due to a mix shift to proprietary branded products versus better capacity utilization? What was the low point of capacity utilization, and where are you now?
Our utilization today represents a new floor; it was slightly higher during the COVID period, as it was across the industry. Despite lower utilization, we’ve proven our ability to deliver better results for shareholders. The gross margin improvement came from three main factors: a shift toward proprietary branded products, strategic pricing, and strong cost management across labor, overhead, and materials. Combined labor and overhead improvements reached roughly 20% versus the prior year, with materials efficiency improving by a similar 20%.
The experienced team we brought back knows how to execute. We gave them the autonomy to perform, and they delivered strong results, reigniting momentum across the organization.
19/09/2025 How has the shift in business mix affected profitability, and what is your current capacity for growth?
Our transition from 90% custom manufacturing to a 75%/25% mix of custom versus product sales has materially improved price realization and gross margins. We’re not abandoning custom work, there’s good business there, but we are deliberately exiting low-quality, low-margin projects. The focus is on upgrading our overall business quality.
Operationally, our three manufacturing sites are running at about 50% utilization on average, which represents both a short-term headwind for cost absorption and a significant long-term opportunity. We can expand materially within the existing footprint with minimal capital needs, roughly $1–3 million per year in maintenance and growth capex, consistent with the past several years. Safety, compliance, and reliability remain non-negotiable; we will not compromise those to chase efficiency. With our cost base already optimized, 20% reductions in labor, overhead, and raw materials in 2024, and SG&A now redeployed toward growth, we’re entering 2025 from a position of strength and scalability.
19/09/2025 What SG&A levers are you pulling now to support growth?
We will keep adding great sales talent, both technical sales and inside sales, as needed. After rounding out the R&D leader role, I feel we are in a strong position to build on our growth momentum without adding unnecessary overhead.
19/09/2025 Within chemicals, how did you improve gross margin during the turnaround?
We first mapped profitability across the entire grid. We took aggressive pricing action where appropriate and identified business priced below variable cost. Where we could not raise price, we gracefully deselected that business. We also shifted mix toward products to fill gaps left by deselection.
Today we are operating in the 25 to 30% gross margin range. In parallel, we deepened partnerships with long-standing customers to uncover new opportunities, which takes time when evolving a transactional relationship into a strategic one.
Outlook & Guidance
06/05/2018 Is the road construction product included in April 10 guidance?
No, it is not included.
06/05/2018 How will EBITDA step up from Q1 to the back half of the year?
In Q2, we expect EBITDA of $8.5 million to $9 million, including some inventory profits, likely higher than Q1. In Q3 and Q4, assuming nickel-neutral pricing and closing the acquisition by June, we expect about $8 million of EBITDA each quarter. With the acquisition, full-year EBITDA should be $32 million to $33 million. Without it, we expect about $30 million.
06/05/2018 Are current sales boosted by customer pull-in ahead of tariffs, or genuine demand?
It is very sustainable demand. Imports from dumping countries were front-loaded in Q1, but we saw no benefit from tariffs. Going forward, Taiwan faces a 25% tariff, Korea will cut shipments by 30%, and others face 25% tariffs with no exemptions expected. We believe domestic producers like us can absorb the extra work, and we have another 40 million pounds of capacity to handle it.
06/05/2018 Was April revenue $26 million?
Yes, that is correct.
06/05/2018 Is April unusually strong and should Q2 revenue exceed $75 million?
There is nothing exceptional about April beyond $1.3 million in Palmer carryover. The rest was solid demand across all business units. We expect Q2 revenue to be stronger than Q1, but $75 million is unlikely. Around $70 million is more realistic.
12/08/2018 Are chemicals, acquisitions, pricing, and reduced competition setting up a strong back half?
Right. At full run rate, the galvanized acquisition should contribute $1.25 million EBITDA per quarter, though ramping will produce under $2 million in the first six months. Chemicals could sustain $15 million revenue per quarter with margin improvements adding $750,000 EBITDA per quarter. Pricing benefits and reduced competition from Korea also support stronger results. We feel very optimistic about the back half.
12/08/2018 Closing remarks?
We thank our employees, shareholders, and customers for their support. It is always better to share good news, and we are excited about the progress this year. We remain very optimistic about the balance of 2018. Thank you.
11/11/2018 Where will Chemicals segment margins trend in Q4 and into next year before the new business ramps?
Mike, this is Dennis. With the mix of tolling and contract manufacturing, Q4 margins may be about 100 basis points better than Q3, but still down roughly 240 basis points year-over-year. The decline reflects material pass-through in pricing, lowering margin percentages. Q2 and Q3 had higher margins from material ownership. In Q4, the mix shifts slightly back, so margins should improve somewhat versus Q3.
13/08/2019 Is EBITDA guidance of $14 million for the second half correct?
Yes, that is correct.
13/08/2019 Is $25–35 million EBITDA a reasonable run rate excluding metal profits and losses?
If you exclude metal profits and losses, that is a good estimate. If nickel prices remain high and London inventory continues to fall, we will likely see some pickup and inventory profits toward the end of Q3, and more certainly into Q4.
03/09/2020 Does management still believe Synalloy can reach the $35–40M EBITDA run rate despite COVID and selling Palmer?
Charles, this is Craig. We believe we are at the bottom of the cycle, with our largest unit showing recessionary volumes like 2016. In 2018, the Company delivered $34 million of adjusted EBITDA, and since we acquired ASTI in 2019, it contributed about $6 million of EBITDA, putting us at $40+ million potential. Palmer has been a drag, marginally positive or negative on EBITDA, and consumed significant management time. Exiting that business is the right move; we do not expect it to generate acceptable returns.
We are confident in the Company’s earnings power. Projects underway, particularly in Munhall, enhance capability beyond 2018 levels. Once our end markets strengthen, we see no doubt in the business’s ability to produce those numbers.
11/05/2021 Should we expect incremental margin improvement in Q2 metals versus Q1?
I will not guarantee, but given tailwinds and backlog, you can expect improvement from Q1 into Q2.
11/05/2021 Was backlog higher at the end of March versus year-end?
Yes, metals backlog has increased month over month since August. This growth is on a per-pound basis, not just nickel price increases.
11/05/2021 Will corporate expense as a percentage of sales decrease over time?
Yes. If sales grow rapidly, corporate expense as a percentage will decline further. Current reductions come from lower interest, insurance savings, and eliminating the airplane. These benefits will flow through the rest of this year and into 2022. Every cost is under review.
11/05/2021 Will there be a roadshow and strategic plan presentation in the second half of 2021?
If it happens, it would be late in the second half. My focus is the back-to-basics model, running operations as efficiently as possible. Once we execute better and stabilize performance, the board, management team, and I will feel comfortable laying out short- and long-term growth and strategic goals to share with stakeholders.
09/08/2021 Is the team getting closer to putting out a strategic plan?
Yes. We are working on a strategic plan aligned with our vision and mission. We are closer in Metals than Chemicals, but our goal is to announce a complete, holistic strategic road map for shareholders within the next few quarters.
09/08/2021 Do you expect the strong cycle to extend into 2022 and beyond, especially if infrastructure spending passes?
Yes, I would echo that. Still, Synalloy is a small component of the global market, and we see opportunities to gain market share in any cycle. We are building a team and culture focused on capturing market share regardless of macro conditions. As Ben mentioned, we have the will to win, and we are determined to be the authors of our success based on the metrics we set, not on pricing or the market environment.
09/08/2021 When will the Chemicals business return to more normalized EBITDA margins?
Hopefully sooner than the fourth quarter. Dave is building a team, driving operational excellence, and understanding the book of business. We provide highly value-added processes and products to many Fortune 500 customers, but historically we have not charged enough relative to the value delivered. Pricing changes began at the end of Q2, and customers have fully accepted the new strategy.
09/11/2021 How sustainable are earnings at this quarter’s level?
Looking at the underperformance of Synalloy chemicals, there is a roadmap to sustain earnings at a similar level to this quarter.
08/08/2023 How much more debt reduction do you expect for 2023?
We don’t have specific guidance, but we believe we can continue making progress on debt reduction through the rest of the year.
08/08/2023 As Tubular becomes more predictable and Chemicals more stable, could the company begin providing earnings guidance?
It’s possible. For now, our guidance will remain directional rather than tied to specific numbers. That’s less about industry volatility and more about company size, sub-$1 billion businesses find it hard to give precise quarterly or annual guidance. Still, we’ll continue to share directional views and help investors understand how we’re thinking about the future.
08/11/2023 Have larger chemical customers in areas like agriculture or personal care shared any visibility into next year?
We’re having those discussions, but customers also face uncertainty. Their forecasts carry much wider ranges than usual, whether in personal care, oil and gas, or CASE markets. Historically, we might expect 1–1.5 million pounds in volume variance, but current ranges are broader. We’re working to supplement that variability by adding new demand from other customers.
28/03/2024 Are customer feedback and order visibility improving in chemicals as 2024 begins?
Yes. From a market perspective, we’re seeing favorable improvement in agriculture and water treatment, with overall demand stabilizing compared to Q4. Looking into the first half of 2024, visibility appears better and markets seem to be trending positively.
28/03/2024 When might investors expect formal or directional guidance?
From the Board’s perspective, we aim to provide clearer directional guidance as the business stabilizes. Volatility in earnings has made quantitative forecasts less reliable, so rather than publishing precise ranges, we’ll focus on greater transparency about what we see and what we expect to achieve over time. You’ll see that evolution in the coming quarters as Brian and Ryan settle into their roles.
28/03/2024 What is the margin opportunity for the Chemical segment once normalized?
It’s still early, but we know margins are currently compressed. Near-term actions include right-sizing costs, improving purchasing, and optimizing pricing. The focus now is on executing those fundamentals rather than setting explicit margin targets. Longer term, we see substantial upside from cost-down initiatives across raw materials, packaging, overhead, and labor. High double-digit EBITDA margins are achievable as these improvements take hold.
08/05/2024 Ben previously referenced a representative double-digit EBITDA margin target , is that still the right goal, or is this year more of a transition?
It’s more of a transitionary period in the near term. However, the two new pieces of business we discussed earlier are squarely within that double-digit EBITDA range, which supports our path toward sustained margin improvement.
12/11/2024 Do you think the tubular segment is near a bottom given improving industrial trends?
We’re cautiously optimistic. We’re starting to see an increase in inbound quotation opportunities across several different markets. We’ll touch base on this again next quarter, but all indications are improving.
12/11/2024 Can you provide any margin or cash flow targets for 2025?
We’re in the process of finalizing our 2025 budget. We plan for continued cash build and sequential growth quarter over quarter. We’ve made good progress stabilizing the enterprise, but we’re not done, there’s no ticker-tape parade yet. We’re just getting started and expect continuous improvements going forward.
04/03/2025 With the strengthening balance sheet, new products, and better margins, do you expect top line growth as early as Q1 2025?
Hey David, appreciate the question. In terms of top line growth, I’d say that’s more of a second-half opportunity. The markets have not yet come back, and we reset the base in both tubular and chemicals during the second half of last year. I don’t expect anything material to change in the first half of 2025. Any uptick we see won’t be due to the markets improving but rather from us gaining share.
13/03/2025 What are the most common questions you hear from investors?
Most of the confusion stems from the company’s dual structure , a steel business sitting beside a chemical business. Our long-time shareholders understand the legacy story, but new investors often ask, “What exactly is Ascent?” and “How do these two pieces fit?” We’re working to clarify that narrative as we evolve into a pure-play Specialty Chemicals company. Many investors also want to understand our history, the changes we’ve made, and where we’re headed. The goal is to earn and maintain their confidence through consistent execution and transparent communication.
28/04/2025 How do you plan to reach your target 15% EBITDA margin and sustain long-term growth?
Our improvement from roughly 4% to 8% EBITDA margin in 2024 came primarily from self-help and the transition toward branded products. The next leg is continuing that shift while leveraging existing, underutilized product lines that have sat idle for years. We’re debt-free and well-capitalized, so we can complement organic growth with disciplined inorganic expansion.
Over the next five years, we’re targeting roughly 15% EBITDA margins through organic growth, portfolio mix optimization, and selective acquisitions. With strong free cash flow generation, about $14 million last year, and the Bristol proceeds, we have the flexibility to invest where returns are highest. We’re not seeking more manufacturing capacity; instead, we see opportunity in distribution-adjacent businesses where customer intimacy and technical service are key. The market there is fragmented and offers meaningful acquisition potential, allowing us to scale efficiently while keeping capital requirements low.
28/04/2025 Do you expect oil and gas to become your largest market exposure?
No. Oil and gas is still one of our smaller segments, but it’s growing. We prefer depth over breadth, focusing on markets where we have strong technical knowledge and can add value. Our main verticals today are pulp and paper, water treatment, oil and gas, and HI&I. We have broad capabilities, but being deep and credible in each target market is more important than participating everywhere.
28/04/2025 Can you provide any color on future financial targets or growth expectations?
With our current specialty chemical base of roughly $80 million in annual revenue, we believe we can reach about $120 million by 2030 within our existing asset footprint. That growth will come primarily from better asset utilization and portfolio optimization, not heavy capital spending. Our facilities already have the installed capacity to support that scale.
For 2025, our focus is less on top-line expansion and more on profitability. The market remains soft, and we’re intentionally reshaping the business to prioritize margin improvement. We’ve already moved gross margins from the low teens toward the mid-teens, and our long-term goal is to reach around 30%. This is not a “growth at all costs” strategy , we’ve deliberately reduced revenue in some areas to improve mix, quality, and sustainability of earnings.
05/05/2025 What visibility do you have toward reaching $120–130 million in sales and higher margins by 2030? How much depends on the macro environment?
We were north of $100 million in 2022, so the goal is realistic. We intentionally reduced revenue to about $80 million to optimize our book of business. From an organic growth standpoint, we expect to reach $120–130 million by 2030.
We currently have over $40 million in active, actionable projects that fit our existing asset base, both in product sales and custom manufacturing. Execution will take time , custom manufacturing sales cycles can run 12–18 months, while branded products close faster, often within six to twelve months or even sooner if customer demand is urgent.
12/05/2025 With chemicals now focused on profitability, can investors expect formal guidance soon?
I don’t think that will happen in 2025. While we stabilized significantly in 2024, there is still some ongoing stabilization in 2025. It’s a little early to issue guidance.
As Ryan mentioned, we are continuing to reevaluate the portfolio, customers, and product mix. Until we have a more stable base and complete the transition to a higher-margin business model, we’ll continue withholding forward guidance.
12/05/2025 Will chemicals grow from $80 million to $120 million by 2030 using the current asset base, and when will growth begin?
We expect some growth to start in the second half of the year. The team has built a strong project pipeline, but sales cycles, especially for branded products, take time. We anticipate a ramp in the second half of 2025 leading into a stronger top line in 2026.
12/05/2025 Is the chemical segment mix moving from 75/25 in 2024 toward 65/35 in 2025 and eventually to a 50/50 split?
Yes. In 2024, we ended with a 75/25 split between custom manufacturing and branded product sales, and Q1 2025 remains in that same range. Our goal is to reach a 65/35 mix by year-end.
06/08/2025 What revenue supports the 2030 adjusted EBITDA margin target of 15%, and can it be achieved with current capacity or will acquisitions be needed?
Within our existing asset base, we’re confident we can reach $120–130 million in revenue. As shown in the MicroCap deck, that translates to gross margins of roughly 30–35% and SG&A around 15%, leading to adjusted EBITDA margins near 15%. We believe we can achieve this within the current footprint, depending on mix.
06/08/2025 Is a return to profitability expected by the third or fourth quarter of 2025?
That’s what we’re driving toward. As Ryan mentioned earlier, excluding the Munhall impact, we’re effectively there. That said, the current profitability levels are small, and we’re not satisfied. We have much larger aspirations that we’re actively working toward.
06/08/2025 After joining the Russell Index, do you expect to maintain inclusion next year given past removals for market cap limits?
I hope that with improved stability, we’ll remain in the index, but I can’t guarantee that.
26/08/2025 What is your revenue goal?
Our target is between $120–130 million within our existing asset base. By 2030, we aim to reach $500 million in revenue, supported by 35% gross margins, 15% SG&A, and 15% EBITDA margins. The first leg of growth will be organic; the rest will come from acquisitions or installing new capacity to pursue business we currently can’t serve due to equipment limitations. Ultimately, profitability matters more than size, but we see a clear path to those metrics.
03/09/2025 What’s the plan to reach $120–130 million in organic revenue?
It’s about focus and execution. We’re putting the right people in place and ensuring they have the tools and processes to win in our core markets. Rather than chasing every opportunity, we’re prioritizing the ones where our capabilities give us the greatest advantage. That disciplined focus is how we’ll reach the $120–130 million revenue target.
19/09/2025 Can you provide some historical context for Ascent and its evolution?
The company’s been around for about 75 years, starting as a specialty chemical business called Blackman in 1945. Around two decades later, it diversified by acquiring stainless-steel tubular manufacturing assets, and for decades operated in both specialty chemicals and tubular products, two segments with no real synergies.
When I joined in early 2024, the board and I decided to optimize the portfolio and refocus on chemicals. Today, Ascent is a pure-play specialty chemical company without the distractions of unrelated segments. Our CFO Ryan Cavalosquez and I reunited much of the turnaround team from our prior company, bringing in experienced operators and giving them the freedom to execute. In 2024, we achieved a $20 million turnaround in EBITDA, generated $17 million in operating cash flow, and materially improved gross margins. That first year was about stabilizing and fixing the foundation, improving business quality in chemicals and preparing the stainless-steel division for sale, setting the stage for 2025.
19/09/2025 What were the key highlights from the first half of the year and what are the main growth catalysts ahead?
In the first half, we reduced cost of goods sold by 24% versus the prior year and delivered solid adjusted EBITDA growth. We also generated roughly $60 million in proceeds from the sale of our stainless steel tubular assets, all while keeping tight control of working capital. The foundation is now set, it’s about growth, growth, and growth.
On catalysts, we have one remaining legacy tubular asset, an empty plant that’s been idle since August 2023. We sold the related equipment in 2024 for about $2.8 million but still pay roughly $2.1 million annually in rent, utilities, and insurance. We expect to resolve this through a transaction with the property owner by year-end. Operationally, we’re seeing strong momentum: over 50 new projects secured in the first half, with 77% coming from existing customers and 23% from new ones, both generating EBIT margins above 25%. Our sales cycle averaged 2.7 months, down from the typical 3–12 months. The sales pipeline grew 45% from Q1 to Q2, from $45 million to $70 million, consisting of actionable projects supported by clear customer demand. This isn’t market tailwind, it’s pure self-help and disciplined execution.
19/09/2025 What are your medium-term financial targets and how are you positioned for growth?
We’re building toward 35% gross margins, 15% SG&A, and 15% EBIT margins, consistent with top-quartile specialty chemical peers. The turnaround work in 2024 established the base; now we’re focused on scaling. Within our existing assets, we can take the top line from $75–80 million to $120–130 million, fully risk-adjusted for downtime and maintenance. With operational excellence, we can go even higher.
We also have ample capital flexibility, $60 million of cash on hand at Q2 close, plus debt capacity if needed. In the first half, we repurchased about 6% of outstanding shares, and we’re evaluating both organic investments and selective M&A. For nondistressed assets, we target up to ~8x pre-synergy multiples, translating to ~6x post-synergies. We also like turnarounds but will only pursue them once utilization rises from the current 50% level toward 75%, ensuring we add capacity without compounding underutilization. The strategy is clear: disciplined capital deployment, clean balance sheet, and strong execution to compound value.
19/09/2025 How will you unlock operating leverage from underutilized capacity, and what is the timeline?
It starts with the selling project pipeline. We had $45 million in the pipeline at the end of Q1 and added $25 million in Q2. We will not win all of it, so the size and quality of the pipeline matter. Some opportunities we have been efforting for three, six, nine, even twelve months are starting to pop. For example, a foreign company localizing supply in the U.S. moved from development to its first commercial-scale run last week, representing four to six hundred metric tons a year of net new business, a couple million dollars, with strong gross margins.
I do not expect a material change in the back half or final quarter of this year. I expect new wins to reach full run rate in 2026. Reaching $120 to $130 million inside the existing asset base is conservatively 2030. Internally, I would be disappointed if we are not there by 2028.
19/09/2025 What will the mix be between custom manufacturing and proprietary products?
Near term, expect 65 to 75% custom manufacturing and 25 to 35% proprietary products. We like proprietary products because demand is more ratable, more predictable, and generally more margin accretive. Custom manufacturing can also be an excellent business when the opportunity quality is high and it dovetails with our assets, and it is typically very sticky over years.
On proprietary products, off-the-shelf materials are less sticky due to competition on service and price. When we customize those bases to solve a customer-specific problem, stickiness increases and looks more like custom manufacturing.
19/09/2025 Where do you want Ascent to be five to ten years from now?
By 2030, I’d like Ascent to be at least a $500 million top-line company, but more importantly, to have materially improved the quality of the business, delivering around 15% EBIT margins. With that growth comes opportunity for our employees, opportunities many can’t even imagine today. My goal is to build a company that continues to lean into its strategy, delivers exceptional results, and creates lasting value for our shareholders, customers, and the communities where we operate.
Risks & Macro
12/08/2018 Is Palmer Tank performing well despite Permian takeaway constraints?
Yes. While companies like EOG and Noble Energy shifted some drilling from the Permian to other basins due to takeaway capacity issues, our backlog remains strong. We cannot produce more than we currently are without emissions changes, which are underway. Even with some shifting, our backlog is sufficient, and we view the takeaway issue as short-lived. The Permian remains one of the lowest-cost basins globally, so drilling activity will continue once capacity expands.
13/08/2019 What impact could new Chinese tariffs have on steel imports?
The tariff increase you are referencing would not affect any steel products.
03/09/2020 Stainless steel pricing rose 27% in Q2. What drove that?
Nickel prices began rising in August, with surcharges moving accordingly, despite a global nickel surplus. Factors include China’s ore shortfall and reduced output in the Philippines, which pushed nickel above $7 per pound. The 27% increase noted in the release related specifically to special alloys tied to project activity.
09/11/2020 Do you see political changes creating catalysts for companies supporting manufacturing and construction?
There is a water and wastewater initiative in the Senate, but it hasn’t advanced. Stimulus spending could include infrastructure, though the outcome is uncertain given Senate control. Typically, infrastructure spending runs in cycles of two and a half years strong followed by two and a half years weak. Demand has been very low in 2019 and 2020, so stimulus could help turn that around. We expect improvement in the second half of next year, consistent with what our customers are telling us.
09/08/2022 Does the $55 billion water infrastructure bill support backlog strength into 2023?
Our backlog remains very strong. The only change we see is a shift in our route to market: distributors tend to fluctuate with surcharges and pricing, while we’re increasingly targeting end-user projects where we control demand. Over the last six months, that segment has grown substantially. These “batch projects” can range from $100,000 to several million dollars for infrastructure, water, or utility work , and they carry a different, more attractive margin profile, which we intend to keep pursuing.
13/03/2025 How would you describe Ascent Industries in one sentence?
Ascent Industries is a 75-year-old industrial manufacturing company with two divisions: Specialty Chemicals and stainless steel tubular products.
13/03/2025 What was the original thesis for Ascent’s founding, and how has the company evolved?
Ascent was founded roughly 65–75 years ago as a Specialty Chemical Company. At one point, the board decided to diversify by adding stainless steel tubular assets. Over time the business evolved, but today we are hyper-focused on rebuilding our Specialty Chemicals platform , effectively returning to our roots.
13/03/2025 What is Ascent’s current mission and what drives the team today?
What excites Ryan and me is making good businesses great. At our previous company, we turned around a failing Specialty Chemical business and successfully exited. We were then presented with the opportunity to join Ascent and apply the same playbook. We had a strong first year fixing the foundation and are very excited about what 2025 holds.
13/03/2025 Can you describe Ascent’s main business segments and what makes its products unique?
We’re evenly split between Specialty Chemicals and stainless steel tubular products. Our Specialty Chemicals capabilities are particularly unique because over time we’ve combined three distinct assets, each with diverse capabilities. We serve a wide range of markets , from paints and coatings, personal care, and high-end industrial uses to oil and gas and pulp and paper. These multifunctional assets let us compete across many applications, and over the past year we’ve been very purposeful in strengthening how we deploy them.
13/03/2025 Beyond execution risk, what are the main downside risks for Ascent?
Focus. When we joined, the company wasn’t failing, but it wasn’t steering its own destiny , it was largely at the mercy of market conditions. With broad capabilities, we can compete across many markets, but that breadth can dilute focus. The challenge is to prioritize, avoid chasing every opportunity, and maintain discipline. For us, the biggest risk is losing that focus as we continue scaling.
28/04/2025 Are tariffs or supply chain reshoring trends benefiting Ascent?
Yes. About 95% of our top line is supported by domestically sourced raw materials, so we’re well insulated from tariff volatility. More importantly, we’re seeing increased inbound interest from customers seeking to localize supply chains within the U.S. Many companies that previously relied on imports from China or other regions are now reaching out to us for domestic solutions, which is opening up incremental growth opportunities.
19/09/2025 Do you rely on industry demand improving to achieve your goals?
No. If our strategy depended on assumed market growth, we should fold up and walk away. The market across segments has been soft. A recent American Chemistry Council publication, within the past one to two months, forecasts broad market contraction into 2026, less than 1%. We plan for aggressive self help. If a tailwind comes, great, but we do not rely on it.
Personal Questions
09/11/2020 With your departure, the Board goes from eight to seven members. Will it return to eight with a new CEO?
The Board has not yet discussed how they will address that situation.
09/11/2021 Chris has been interim CEO for almost a year. Can you address this?
We discuss this frequently at the Board level. We are pleased with team performance and overall functioning, and the Board is actively considering the matter.
08/08/2023 After three challenging quarters with turnover and destocking, what message would you share with investors watching from the sidelines?
We need to execute better, plain and simple. We manage the business for current shareholders, of which we are the largest, and we owe them improved execution and returns. For those on the sidelines, it’s up to them to weigh the risk and reward, but at today’s share prices, given our view of the company’s potential and the progress already underway, we believe it’s a compelling investment. We’re putting both our personal and corporate capital behind that belief.
06/08/2024 After six months with the management team, do you see greater potential than you did initially?
Yes, absolutely. I’m incredibly bullish about our company’s prospects. We’ve got foundational capabilities that are only beginning to be unlocked, and there’s much more we can achieve within our existing assets.
I completely agree. There’s a ton of efficiency to extract and margin to drive through self-help. Commercially, we have areas to fix, but within operations there’s more upside than we anticipated. It’ll take time to identify and pull the biggest levers, but we remain extremely optimistic , even more so than when we started.
04/03/2025 After leading the company for over a year, where do you see it a year from now?
We’re pivoting toward growth, both organically and inorganically. We have underutilized assets that need to be filled with high-quality, high-value applications, and we’re actively working to make that happen.
28/04/2025 Can you start by introducing yourself and giving context on Ascent’s background and your experience leading up to today?
I’m Brian Kitchen, president and CEO of Ascent, joined by our CFO, Ryan Cavalowskis. We’ve worked together for about ten years, starting in the chemical industry at Dow and later turning around a struggling company called Clearon. When we joined Clearon, it was losing about $8 million of adjusted EBITDA annually and was close to bankruptcy. After roughly four and a half years, we sold it with trailing-twelve-month adjusted EBITDA around $36 million. That experience taught us valuable lessons we’re now applying at Ascent.
Ascent itself has a 75-year history, beginning as a specialty chemical company before diversifying into stainless steel tubular assets in the 1960s. I joined in late 2023 to build out the specialty chemicals segment but was soon asked to lead the whole company. Ryan joined shortly after, and together we focused on stabilizing operations. 2023 was a terrible year financially, but by year-end 2024 we achieved a $19 million turnaround through disciplined execution and a cultural shift toward self-help and accountability.
28/04/2025 Can you clarify the comment regarding compensation structure?
That question caught us a bit off guard during the session. The company hasn’t publicly discussed specific executive compensation breakdowns, so there’s no further detail to add beyond what’s already disclosed in filings.
28/04/2025 How is executive compensation being structured to align with performance?
The compensation committee has begun reassessing how Ryan and I are paid, moving toward a structure more explicitly tied to performance metrics. Last year was our first full year leading Ascent, and the committee is using that as a baseline for evaluating future alignment between results and compensation.
05/05/2025 How does this opportunity compare to your past experiences, and what excites you most about it?
We learned a lot at our previous company. One of the first lessons was in strategic sourcing , the tremendous value that skilled sourcing professionals can unlock for a business. Another major takeaway was “hire fast, fire faster.”
At the prior company, we didn’t always have the cash to make those tough but necessary personnel decisions. Here, we’re in a much stronger financial position, which allows us to apply that discipline from day one. Those lessons, combined with a stronger foundation and better resources, make this opportunity both exciting and rewarding for us.
12/05/2025 Do you believe the stock remains undervalued?
In my personal opinion, yes.
06/08/2025 Would adding board members with chemical industry experience be advantageous now that the company is primarily chemical-focused?
Our board has been incredibly supportive of Ryan, me, and the team over the past year. We do recognize that there’s currently no chemical industry representation on the board, and that’s being addressed.
26/08/2025 Who is on the board and what’s next for governance?
Chris remains one of our largest shareholders and sits on the board, but neither he nor Ben are involved in day-to-day operations. Our current board was instrumental in supporting the turnaround, but as we evolve into a pure-play specialty chemicals company, we’re reimagining the board’s composition. Expect to see changes ahead.
19/09/2025 What brought you to Ascent and what attracted you to the opportunity?
I’ve been in the specialty chemical industry for roughly 25 years. Before joining Ascent, our CFO, Ryan Cavalosquez, and I worked for a smaller specialty chemical company in West Virginia, where we cut our teeth on turnarounds. That business was losing about $8 million in adjusted EBITDA when we joined; four and a half years later, we had turned it into roughly $36 million of adjusted EBITDA on a trailing-twelve-month basis. It was an intense experience, but it taught us a lot about cash management and disciplined execution.
After that sale, we paused to reflect on what we’d do differently if we could start over. That’s when the Ascent opportunity surfaced. I had never heard of Sinco Alloy or Ascent, but after some diligence I saw a company with good bones that just needed a strategy. I joined to run the specialty chemicals segment, and a few months later the board asked me to take over the entire company.
19/09/2025 After becoming CEO, what key hires did you make, and how have they shaped the business?
One of the first priorities was building a cohesive leadership team. Outside of bringing in Ryan as CFO, our first major hire was a head of strategic sourcing. Previously, our three plants operated almost as standalone businesses with no shared procurement strategy. Consolidating those buys delivered a 20% reduction in raw material costs, a major early win.
We also added a VP of Sales with extensive experience across multinational and regional chemical companies, a general counsel who also leads regulatory affairs, and a VP of Business Operations overseeing customer care, planning, and scheduling, the foundational back-office processes that support scale. He actually started as my intern years ago at Dow Chemical. Collectively, this cross-functional team has deep turnaround experience and chemistry industry knowledge, forming a strong operational backbone for Ascent’s next phase of growth.
19/09/2025 How did employees react to your arrival, and how is culture changing?
At first, the sentiment was we do not like you, we do not know you, and we do not believe what you say. A year to a year and a half later, while some may not like me, they trust me and believe what we say because we back words with action.
There was no defined employee bonus program before. There is today, and every single employee is impacted by it.
19/09/2025 How have employees responded to the reinvestment in people and the renewed company focus?
We said we were going to reinvest in people, and we’ve done exactly that. Employees can see the quality of talent we’ve been able to identify, attract, and retain, and they’re seeing the results of those hires. People are leaning into Ascent now. They love that we’re a pure-play specialty chemical company, that when they wake up, they know exactly what business they’re in. That clarity has created real momentum.
In town halls, I talk about the “three loves”: love your job, love the company you work for, and love the people you work with. When those are in balance, everything else falls into place. I think we’re getting there. There’s visible passion and excitement that customers can feel when they visit our plants. This quarter alone, we’ve hosted 11 customer visits, serious engagements, not field trips. They come because they see opportunity and want to partner with Ascent, and our employees’ enthusiasm reinforces that.
Other
03/09/2020 Any plans for analyst coverage or investor conferences?
We usually participate in at least one conference per year, but none this year due to COVID. In the past, two analysts covered us after our 2013 follow-on offering, but those firms exited research. We’ve been approached by paid-research groups charging $30,000–$50,000 annually, but that raises concerns about objectivity.
At this point, no analysts cover us. We would welcome organic coverage from a small firm, but we are not pursuing capital raises, which often go hand-in-hand with attracting analyst coverage.
09/08/2022 Are the benefits of rebranding worth the costs?
Absolutely. The costs were not significant. The Revant brand has been needed for years. Previously, the organization felt divided , employees identified with separate parts of the business and many didn’t even know what Synalloy was. Now, we are one team under one name. The internal response has been extremely positive.
09/05/2023 How many market makers are in your stock?
I don’t have that information right now, but we’ll flag it as a follow-up.
09/05/2023 Why are most trades in small odd lots, with round lots under 10%?
I don’t have that data available at the moment. It’s not something we analyze closely, but we can take that offline and explore it further.
09/05/2023 Are there any analysts or brokerage firms currently covering the company?
That’s a great question. We’ve been working on that over the past few months, and I’m hopeful we’ll have positive developments soon regarding new brokerage coverage. As of now, there are none actively following us, but that should improve over time.
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Brilliant walkthrough of Kitchen's capital allocation thinking here. The bit about targeting pre-synergy acquisitions at 8-9x but aiming for 6-7x post-synergies is really revealing, especially when they're simultaenously buyng back shares. What's underappreciated is how this dual approach creates real optionality instead of forcing them into either/or thinking duringthe transition to pure-play chemicals. It's textbook patient capital deployed by operators who've clearly sat through enough bad deals to know when to walk away.