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What changed in Element Solutions Inc's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Element Solutions Inc's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+243 added−239 removedSource: 10-K (2026-02-18) vs 10-K (2025-02-19)

Top changes in Element Solutions Inc's 2025 10-K

243 paragraphs added · 239 removed · 200 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

65 edited+11 added−12 removed48 unchanged
Biggest changeThese core values are the foundation of our organization. We believe they reinforce our strategic objectives and empower our employees when serving and engaging with our customers globally. 6 At December 31, 2024, we employed over 5,300 full-time employees, of which approximately 40% are research and development chemists and experienced technical service and technical sales personnel.
Biggest changeAt December 31, 2025, we employed approximately 5,200 full-time employees, of which approximately 40% are research and development chemists and experienced technical service and technical sales personnel. Our full-time employees are based throughout the world, with approximately 80% employed outside of the U.S.
We provide highly-technical service and support to customers and OEMs in order to optimize their manufacturing processes. While they typically represent only a small portion of our customers' costs, our products, along with our high-value added technical support, are seen as integral to customer product performance. Neither of our segments is subject to significant seasonality.
We provide highly-technical service and support to customers and OEMs in order to support and optimize their manufacturing processes. While they typically represent only a small portion of our customers' costs, our products, along with our high-value added technical support, are seen as integral to customer product performance. Neither of our segments is subject to significant seasonality.
Our research and development activities are also focused on developing products, and improving formulations and processes, not only to respond to or anticipate customers' changing needs, but also to drive growth or otherwise add value to our core business operations and those of our customers.
Our research and development activities are focused on developing products, and improving formulations and processes, not only to respond to or anticipate customers' changing needs, but also to drive growth or otherwise add value to our core business operations and those of our customers.
Enabling our customers to improve their environmental footprint will allow us to do well by doing good. 5 • Decisiveness and Action Orientation. A customer-oriented, customer-service driven organization requires decentralized decision making. We encourage our employees to make decisions and empower them to act swiftly to meet the ever-changing local needs of our customers.
Enabling our customers to improve their environmental footprint will allow us to do well by doing good. • Decisiveness and Action Orientation. A customer-oriented, customer-service driven organization requires decentralized decision making. We encourage our employees to make decisions and empower them to act swiftly to meet the ever-changing local needs of our customers.
We accelerate market introductions and increase the impact of our local product offerings through collaboration with partners in the academic and commercial sectors (customers and value-chain partners) and 7 by working with customers and OEMs on tailored application development around the world through our technical service teams.
We accelerate market introductions and increase the impact of our local product offerings through collaboration with partners in the academic and commercial sectors (customers and value-chain partners) and by working with customers and OEMs on tailored application development around the world through our technical service teams.
Business Overview Element Solutions, incorporated in Delaware in January 2014, is a leading global specialty chemicals company whose businesses supply a broad range of solutions that enhance the performance of products people use every day.
Business Overview Element Solutions, incorporated in Delaware in January 2014, is a leading global specialty chemicals technology company whose businesses supply a broad range of solutions that enhance the performance of products people use every day.
Although certain of these patents are important to our business, no specific group or groups of intellectual property rights are material, and we have many proprietary products which are not covered by patents.
Although certain of these patents are important to our business, no specific group or groups of intellectual property rights are material to our business overall, and we have many proprietary products which are not covered by patents.
This close proximity to our global customers' local sites enables access to key growth markets and, along with our efficient formulation process, allows for "just in time" supply chain management. We believe that our businesses are not materially dependent upon any single customer with no customer representing 10% or more of our consolidated net sales in 2024, 2023 or 2022.
This close proximity to our global customers' local sites enables access to key growth markets and, along with our efficient formulation process, allows for "just in time" supply chain management. We believe that our businesses are not materially dependent upon any single customer with no customer representing 10% or more of our consolidated net sales in 2025, 2024 or 2023.
For financial and other information about our segments and the geographic areas in which we do business, see "Management’s Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7, "Financial Statements and Supplementary Data" in Part II, Item 8, as well as Note 1, "Background and Basis of Presentation" and Note 22, "Segment Information" to our audited Consolidated Financial Statements, all included in this 2024 Annual Report.
For financial and other information about our segments and the geographic areas in which we do business, see "Management’s Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7, "Financial Statements and Supplementary Data" in Part II, Item 8, as well as Note 1, "Background and Basis of Presentation" and Note 22, "Segment Information" to our audited Consolidated Financial Statements, all included in this 2025 Annual Report.
We believe we are in material compliance with environmental laws and regulations applicable to our operations, and consider the liabilities recorded at December 31, 2024 for our various environmental matters to be appropriate. For additional information about the risks related to government regulations, please refer to “Item 1A. Risk Factors.” Available Information Our internet website address is www.elementsolutionsinc.com .
We believe we are in material compliance with environmental laws and regulations applicable to our operations, and consider the liabilities recorded at December 31, 2025 for our various environmental matters to be appropriate. For additional information about the risks related to government regulations, please refer to “Item 1A. Risk Factors.” Available Information Our internet website address is www.elementsolutionsinc.com .
The SEC also maintains an internet website available at www.sec.gov that contains reports, proxy and information statements and other information filed by issuers, such as Element Solutions. The information on or linked to our website is not incorporated by reference into, and does not form a part of, this 2024 Annual Report or any of our other SEC filings.
The SEC also maintains an internet website available at www.sec.gov that contains reports, proxy and information statements and other information filed by issuers, such as Element Solutions. The information on or linked to our website is not incorporated by reference into, and does not form a part of, this 2025 Annual Report or any of our other SEC filings.
Clear communication, strong strategic alignment and a culture that rewards good judgement allow us to ensure the right decisions are being made by our trusted global workforce. • Recruitment and Talent Development . Our success is a by-product of the efforts and capabilities of our people from our research and development laboratories to our customers’ manufacturing floors.
Clear communication, strong strategic alignment and a culture that rewards good judgment allow us to ensure the right decisions are being made by our trusted global workforce. • Recruitment and Talent Development . Our success is a by-product of the efforts and capabilities of our people from our research and development laboratories to our customers’ manufacturing floors.
Semiconductor Solutions - representing approximately 20% of the segment's 2024 net sales. As a global supplier to the semiconductor industry, we provide advanced copper interconnects, die attachment, sintered silver material, adhesives, wafer bump processes and photomask technologies to our customers for integrated circuit fabrication and semiconductor packaging.
Semiconductor Solutions - representing approximately 20% of the segment's 2025 net sales. As a global supplier to the semiconductor industry, we provide advanced copper interconnects, die attachment, sintered silver material, adhesives, wafer bump processes and photomask technologies to our customers for integrated circuit fabrication and semiconductor packaging.
Item 1. Business Unless the context otherwise indicates or requires, all product names, trade names, trademarks, service marks or logos used in this 2024 Annual Report are part of our intellectual property, although the “®” and “TM” trademark designations may have been omitted.
Item 1. Business Unless the context otherwise indicates or requires, all product names, trade names, trademarks, service marks or logos used in this 2025 Annual Report are part of our intellectual property, although the “®” and “TM” trademark designations may have been omitted.
Products A selection of Industrial & Specialty's product offerings is presented below: Industrial Solutions Electroless Nickel Electroless nickel is applied to a variety of metal and plastic surfaces to enhance corrosion resistance, wear resistance, solderability and to repair worn or over-machined surfaces in a variety of applications. Plating Products Plating products are high-performance coatings used in multiple applications.
Products A selection of Specialties' product offerings is presented below: Industrial Solutions Electroless Nickel Electroless nickel is applied to a variety of metal and plastic surfaces to enhance corrosion resistance, wear resistance, solderability and to repair worn or over-machined surfaces in a variety of applications. Plating Products Plating products are high-performance coatings used in multiple applications.
Acquisitions and Divestitures We may pursue targeted and opportunistic acquisitions in our existing and adjacent end-markets that seek to strengthen our current businesses, expand and diversify our product offerings, and enhance our growth and strategic position as well as divestitures to maximize long-term value creation for our shareholders.
Acquisitions and Divestitures We regularly pursue targeted and opportunistic acquisitions in our existing and adjacent end-markets that seek to strengthen our current businesses, expand and diversify our product offerings, and enhance our growth and strategic position as well as divestitures to maximize long-term value creation for our shareholders.
For more information on our workforce prosperity efforts, social and community impact and sustainability goals, see our ESG reports and ESG supplements posted on the Sustainability section of our website. The information included in our ESG reports, ESG supplements or sustainability website is not a part of this 2024 Annual Report and is not incorporated by reference.
For more information on our workforce prosperity efforts, social and community impact and sustainability goals, see our ESG reports and ESG supplements posted on the Sustainability section of our website. The information included in our sustainability reports, supplements or website is not a part of this 2025 Annual Report and is not incorporated by reference.
As a global supplier of surface mount technologies (SMT), fluxes, thermal management materials, coatings and other attachment materials, we develop high-performing innovative materials that are used to assemble consumer electronics from circuit boards, discrete electronic components, connectors and integrated circuit substrates.
As a global supplier of SMT, fluxes, thermal management materials, coatings and other attachment materials, we develop high-performing innovative materials that are used to assemble consumer electronics from circuit boards, discrete electronic components, connectors and integrated circuit substrates.
Electronics Our Electronics segment researches, formulates and sells specialty chemicals and process technologies for all types of electronics hardware, from complex printed circuit board designs to advanced semiconductor packaging. In mobile communications, computers, automobiles and aerospace equipment, its products are an integral part of the electronics manufacturing process and the functionality of end-products.
Electronics Our Electronics segment researches, formulates and sells specialty chemicals and material process technologies for all types of electronics hardware, from complex printed circuit board designs to advanced semiconductor packaging. In high-performance datacenters, mobile communications, computers, automobiles and aerospace equipment, its products are an integral part of the electronics manufacturing process and the functionality of end-products.
Circuitry Solutions - representing approximately 30% of the segment's 2024 net sales. As a global supplier of chemical formulations to the electronics industry, we design and manufacture proprietary "wet" chemical processes and materials used by our customers to manufacture printed circuit boards and memory storage devices.
Circuitry Solutions - representing approximately 29% of the segment's 2025 net sales. As a global supplier of chemical formulations to the electronics industry, we design and manufacture proprietary "wet" chemical processes and materials used by our customers to manufacture printed circuit boards and memory storage devices.
In addition, both of our segments are led by executives who have extensive experience in their respective fields. Business Strategies We are building a best-in-class global specialty chemical solutions company.
In addition, both of our segments are led by executives who have extensive experience in their respective fields. Business Strategies We are building a best-in-class global specialty chemicals technology company.
Our operating teams focus on the strong execution of customer-led product development, superior technical sales support and continuous supply chain optimization. Our senior leadership aims to foster an environment of accountability and success for our operating teams while also evaluating and executing on high-return capital allocation opportunities that can drive improvements in long-term shareholder value.
Our operating teams focus on the strong execution of customer-led product development, superior technical sales support and continuous supply chain optimization. Our senior leadership aims to foster an environment of accountability and success for our operating teams while also evaluating and executing on high-return capital allocation opportunities that can drive compounding of long-term intrinsic value per share.
Our segments share a common focus on attractive niche markets, which we believe will grow faster than the diverse end-markets they each serve. Both segments provide products that, in substantially all cases, are consumed by customers as part of their production process, providing us with reliable and recurring revenue as products are replenished in order to continue production.
Our segments share a common focus on attractive niches, which we believe will grow faster than their diverse, overall end-markets. Both segments provide products that, in substantially all cases, are consumed by customers as part of their production process, providing us with reliable and recurring revenue as products are replenished in order to continue production.
We believe our growth in this industry will be primarily driven by increased worldwide automobile production with elevated fashion elements and higher content per vehicle as well as general economic growth. 3 Graphics Solutions - representing approximately 16% of the segment's 2024 net sales .
We believe our growth in this industry will be primarily driven by increased worldwide automobile production with elevated fashion elements and higher content per vehicle as well as general economic growth. 3 Energy Solutions - representing approximately 12% of the segment's 2025 net sales.
In addition, we promote further employee connection and engagement through a variety of initiatives, including our employee resource groups (ERGs), which allow discussions of common interest across all businesses and geographies, and which in turn helps us attract and retain diverse candidates. Talent Retention and Development .
In addition, we promote further employee connection and engagement through a variety of initiatives, including our employee resource groups (ERGs), which allow discussions of common interest across all businesses and geographies, and which in turn helps us attract and retain diverse candidates. 6 Talent Retention and Development . We operate a customer-centric, people-oriented model.
The Company has a longstanding commitment to social impact by supporting communities in which we operate and encouraging the contributions of our employees. Through our engagement programs, our employees can connect to volunteering opportunities and nonprofit organizations of their choice, supporting causes they care about, locally and/or globally, including education, humanitarian relief and minorities.
The Company has a longstanding commitment to social impact by supporting communities in which we operate and encouraging the contributions of our employees with our ESI Cares program. Through our engagement initiatives, our employees can connect with volunteering opportunities and nonprofit organizations of their choice, supporting causes they care about, locally and/or globally, including education, humanitarian relief and underserved communities.
Industrial & Specialty provides solutions through the following businesses: Industrial Solutions - representing approximately 75% of the segment's 2024 net sales. As a global supplier of industrial metal and plastic finishing chemistries, we primarily design and manufacture chemical systems that protect and decorate surfaces.
Specialties provides solutions through the following businesses: Industrial Solutions - representing approximately 85% of the segment's 2025 net sales. As a global supplier of industrial metal and plastic finishing chemistries, we primarily design and manufacture chemical systems that protect and decorate surfaces.
Research and Development Innovation is a key element of our culture and critical to our success. Continued investment in research and development ensures that we remain ahead of emerging trends and continue to strengthen our strong positions in our market niches.
Research and Development Innovation is critical in our industry and to our success. Continued investment in research and development ensures that we remain ahead of emerging trends and continue to strengthen our strong positions in our market niches.
At December 31, 2024, 8 we owned, had applications pending, or licensed the rights to, approximately 2,900 domestic and foreign patents, which have remaining lives of varying duration.
At December 31, 2025, we owned, had applications pending, or licensed the rights to, approximately 2,600 domestic and foreign patents, which have remaining lives of varying duration.
The ESI Foundation further brings our purpose to life with a matching gift program. It also focuses on causes important to the environmental and social well-being of these communities, such as EARTHDAY.ORG's The Canopy Project ® , which in 2024 helped us celebrate Earth Day with the planting of trees around the world.
The ESI Foundation further supports our purpose through a gifting and donation matching program. It also focuses on causes important to the environmental and social well-being of these communities, such as EARTHDAY.ORG's The Canopy Project ® , which in 2025 helped us celebrate Earth Day with the planting of trees around the world.
The segment's "wet chemistries" for metallization, surface treatments and solderable finishes form the physical circuitry pathways and its "assembly materials," such as solder, pastes, fluxes and adhesives, join those pathways together. Electronics provides solutions through the following businesses: Assembly Solutions - representing approximately 50% of the segment's 2024 net sales.
The segment's "wet chemistries" for metallization, surface treatments and solderable finishes form the physical circuitry pathways and its "assembly materials," such as surface mount technologies (SMT), pastes, fluxes and adhesives, join those pathways together. Electronics provides solutions through the following businesses: Assembly Solutions - representing approximately 51% of the segment's 2025 net sales.
Although competition varies by end-market and geography, our most significant competitors are MKS Instruments, DuPont de Nemours, Inc., Henkel Corporation, Senju Metal Industry Co. and Uyemura International. Industrial & Specialty Our Industrial & Specialty segment provides a broad line of proprietary chemical compounds and supporting services, and broadly competes within the specialty chemicals industry.
Although competition varies by end-market and geography, our most significant competitors are MKS Instruments, Qnity Electronics, Inc., Henkel Corporation, Senju Metal Industry Co. and Uyemura International. Specialties Our Specialties segment provides a broad line of proprietary chemical technologies and supporting services, and broadly competes within the specialty chemicals industry.
Developed in multi-step technological processes, these innovative solutions enable customers' manufacturing processes in several key industries, including consumer electronics, power electronics, semiconductor fabrication, communications and data storage infrastructure, automotive systems, industrial surface finishing, consumer packaging and offshore energy.
Developed in multi-step technological processes, these innovative solutions enable customers' manufacturing processes in multiple high-value industries, including consumer electronics, power electronics, semiconductor fabrication, high-performance computing, communications and data storage infrastructure, automotive systems, industrial surface finishing and offshore energy.
We intend to be opportunistic with the allocation of our free cash flow and may pursue organic investments in priority markets, bolt-on and strategic acquisitions, as well as stockholder-friendly capital returns, such as share repurchases or dividends. Our investment decisions will be driven by comparing relative and absolute risk adjusted returns expectations.
We intend to be opportunistic with the allocation of our free cash flow and may pursue organic investments in priority markets, bolt-on and strategic acquisitions and stockholder-friendly capital returns, such as share repurchases or dividends.
Government Regulations As a global specialty chemicals company, we are subject to various, complex and evolving federal, state, local, and international laws and regulations relating to the development, manufacture, sale, and distribution of our products across the countries in which we operate. These regulations include, but are not limited to, those relating to safety, health and environmental (SH&E) matters.
Government Regulations As a global specialty chemicals technology company, we are subject to various, complex and evolving federal, state, local and international laws and regulations relating to the development, manufacture, sale and distribution of our products across the countries in which we operate.
Customers Our businesses have diverse customer bases and sell products either directly to end-user customers or through intermediaries. We also have collaborative relationships with many OEMs and industry partners, who specify our chemistries and technologies for use in their products or grant us development rights to their intellectual property.
We also have collaborative relationships with many OEMs and industry partners, who specify our chemistries and technologies for use in their products or grant us development rights to their intellectual property.
With our focus on innovation and service, key elements of our human capital strategy are the attraction, acquisition and engagement of highly-skilled employees. Accordingly, we invest in creating opportunities to help employees grow and build their career through training, professional development and education programs.
Our human capital strategy is based on three pillars: the attraction, acquisition and engagement of highly-skilled employees. Accordingly, we invest in creating opportunities to help employees grow and build their careers through training, professional development and education programs.
We work closely with our customers, OEMs and other industry participants to develop new products and identify new market opportunities. We participate in a variety of dynamic end-markets where new unmet needs are always materializing. Our sales and technical service teams provide continuous insights that help ensure our research and development efforts are appropriately focused.
We participate in a variety of dynamic end-markets where new unmet needs are always materializing. Our sales and technical service teams provide continuous insights that help ensure our research and development efforts are appropriately focused.
Instead of large investments in physical assets to sustain business or grow, we focus our investments on our technological innovation or sales and services areas. Our business involves the formulation of a broad range of specialty chemicals created by blending raw materials and incorporating them into multi-step technological processes. This model allows us to conservatively manage our fixed asset investments.
Our business involves the formulation of a broad range of 4 specialty chemicals created by blending raw materials and incorporating them into multi-step technological processes. This model allows us to conservatively manage our fixed asset investments.
Although competition varies by end-market and geography, our most significant competitors are MKS Instruments, DuPont de Nemours, Inc., BP p.l.c., Miraclon Corp. and XSYS Global. Sources and Availability of Raw Materials Our businesses formulate a broad range of specialty chemicals, which we create by blending raw materials and incorporating them into multi-step technological processes.
Although competition varies by end-market and geography, our most significant competitors are MKS Instruments, Quaker Houghton, and Castrol. Sources and Availability of Raw Materials Our businesses formulate a broad range of specialty chemical process technologies, which we create by blending raw materials and incorporating them into multi-step technological processes.
Our customers use our innovation as a competitive advantage, relying on us to help them navigate through fast-paced, high-growth markets. To that end, we draw upon our broad and longstanding intellectual property portfolio and technical expertise, while working closely with both customers and OEMs on an ongoing basis, to develop proprietary solutions tailored to their manufacturing needs.
To that end, we draw upon our broad and longstanding intellectual property portfolio and technical expertise, while working closely with both customers and OEMs on an ongoing basis, to develop proprietary solutions tailored to their manufacturing needs.
We also track internal KPIs related to career development and internal promotion, and regularly review talent development and succession plans for our functions and segments. In addition, we conduct regular global employee culture surveys to collect feedback on our employees' experience at the Company as well as their views on leadership, understanding of our culture, and sense of inclusion.
In addition, we conduct regular global employee culture surveys to collect feedback on our employees' experience at the Company as well as their views on leadership, understanding of our culture, and sense of inclusion.
Energy Solutions - representing approximately 9% of the segment's 2024 net sales. As a global supplier of specialized fluids to the offshore energy industry, we produce water-based hydraulic control fluids for major oil and gas companies and drilling contractors to be used in offshore deep-water production and drilling applications.
As a global supplier of specialized fluids to the offshore energy industry, we produce water-based hydraulic control fluids for major oil and gas companies and drilling contractors to be used in offshore deep-water production and drilling applications. We believe our growth in this business will be driven by continued capital expenditures in energy exploration and production.
We also care for our employees' health and offer benefits designed to support their physical, mental and financial well-being, including parental leave, healthcare, life insurance and disability coverage programs. Diversity, Equity and Inclusion ("DE&I") . We believe diversity, equity and inclusion drive innovation, which in turn allows us to compete effectively.
We also offer benefits designed to support employees' physical, mental and financial well-being, including parental leave, healthcare, life insurance and disability coverage programs. Inclusion . We believe that innovation and problem-solving thrive when people with diverse perspectives and experiences work together, which in turn allows us to compete effectively.
Corporate Information Our principal executive offices are located at 500 East Broward Boulevard, Suite 1860, Fort Lauderdale, Florida 33394 and our telephone number is (561) 207-9600. 9
Corporate Information Our principal executive offices are located at 500 South Pointe Drive, Suite 200, Miami Beach, Florida 33139 and our telephone number is (561) 207-9600. 9
Our full-time employees are based throughout the world, with approximately 80% employed outside of the U.S. In certain countries where we operate, our employees are also members of unions or are represented by works councils. We believe our relationships with our employees and collective bargaining unions are satisfactory. Occupational Health and Safety .
In certain countries where we operate, our employees are also members of unions or are represented by works councils. We believe our relationships with our employees and collective bargaining unions are satisfactory. Occupational Health and Safety . As a specialty chemicals company, the success of our business is fundamentally connected to the safety of our employees.
As part of our broader sustainable solutions platform, we also provide both chemistry and equipment for turnkey wastewater treatment, recycling and reuse solutions. Our industrial customer base is highly diverse and includes customers in the following end-markets: appliances and electronics equipment; automotive parts; industrial parts; plumbing goods; construction equipment and transportation equipment.
Our industrial customer base is highly diverse and includes customers in the following end-markets: appliances and electronics equipment; automotive parts; industrial parts; plumbing goods; construction equipment; and transportation equipment. In this business, we also sell certain water-treatment solutions and lubricants used in similar end-markets.
Compliance with SH&E requirements has not had, and in the future is currently not expected to have, a material effect on our capital expenditures, results of operations and competitive position as compared to prior periods. However, SH&E requirements are gradually becoming more stringent and may cause us to incur additional costs, fines or penalties in the future.
These regulations include, but are not limited to, those relating to safety, health and environmental (SH&E) matters. 8 Compliance with SH&E requirements has not had, and in the future is currently not expected to have, a material adverse effect on our capital expenditures, results of operations and competitive position as compared to prior periods.
We believe the ability to provide an “end-to-end” product offering is a significant competitive advantage over many of our smaller competitors. Additionally, we believe our breadth of touchpoints from circuit formation through circuit assembly is unique in the market and allows for a broader dialogue with customers in electronics end-markets.
Additionally, we believe our breadth of touchpoints from circuit formation through circuit assembly is unique in the market and allows for a broader dialogue with customers in electronics end-markets. We also believe that our existing product offerings provide many opportunities for growth in adjacent end-markets. • Stable Cash Flow and Low Capital Requirements.
The specific competitive environment of each of our segments is described below: Electronics Our Electronics segment provides a broad line of proprietary chemical compounds and supporting services, and broadly competes within the specialty chemicals industry.
We also face competition from many smaller companies that specialize in particular segments of the markets in which we compete. 7 The specific competitive environment of each of our segments is described below: Electronics Our Electronics segment provides a broad line of proprietary chemical technologies, materials and supporting services and broadly competes within the electronics materials industry.
To support this approach, our talent program is based on policies designed to ensure fair hiring practices and prevent discrimination and harassment, as well as diversity training on a targeted basis. In 2024, we continued on our path toward creating an inclusive workplace and adopted a new DE&I goal, which is to increase gender diversity at management-level globally by 2027.
To support this approach, our talent program is based on policies designed to ensure fair hiring practices and prevent discrimination and harassment. In 2025, we continued to train managers and other employees on inclusivity in the workplace and made progress toward our goal to increase gender diversity at management-level globally.
Wastewater Solutions Wastewater solutions are treatment and recycling systems that allow for less waste discharge and a more sustainable use of resources including water, metals and other production inputs. Water Treatment Water treatment consists of Fernox, our water treatment product line, which is used for the filtration, corrosion inhibition, and conditioning of water in residential and commercial boiler systems.
Water Treatment Water treatment consists of Fernox, our water treatment product line, which is used for the filtration, corrosion inhibition, and conditioning of water in residential and commercial boiler systems.
Industrial & Specialty Our Industrial & Specialty segment researches, formulates and sells specialty chemicals and process technologies that enhance surfaces or improve industrial processes in diverse industrial sectors from automotive trim to transcontinental infrastructure and from high-speed printing to high-design faucets.
Specialties Our Specialties segment researches, formulates and sells specialty chemicals and material process technologies that enhance surfaces or improve industrial processes in diverse industrial sectors from automotive trim to transcontinental infrastructure to high-design faucets. Its products include chemical systems that protect and decorate metal and plastic surfaces and chemistries used in water-based hydraulic control fluids for offshore energy production.
We provide our customers with a comprehensive offering of products that meet many of their specialty chemical needs. In many cases, we offer a full suite of products with complementary capabilities that provide a complete functional solution to our customers.
We provide our customers with a comprehensive offering of products that are critical to their efficient operations. In many cases, we offer a full suite of products with complementary capabilities that provide a complete functional solution to our customers. We believe the ability to provide an “end-to-end” product offering is a significant competitive advantage over many of our smaller competitors.
The transaction is expected to close in the first quarter of 2025, subject to customary closing conditions and adjustments. 1 Business Segments Our operations are organized into two reportable segments: Electronics and Industrial & Specialty. In 2024, we achieved sales of $2.46 billion, to which our Electronics and Industrial & Specialty segments contributed approximately 64% and 36%, respectively.
Business Segments Our operations are organized into two reportable segments which were renamed in the fourth quarter of 2025: Electronics (MacDermid Alpha Electronics Solutions, previously known as Electronics) and Specialties (Element Specialties, previously known as Industrial & Specialty). In 2025, we achieved sales of $2.55 billion, to which our Electronics and Specialties segments contributed approximately 70% and 30%, respectively.
In addition, some of our competitors may have greater financial, technical and marketing resources than we do and may be able to devote greater resources to promoting and selling certain products. We believe, however, that our ability to manufacture, sell, service and develop new products and applications enable us to compete successfully.
Further consolidation within our industry or other changes in the competitive environment could result in larger competitors that compete with us across several business areas. In addition, some of our competitors may have greater financial, technical and marketing resources than we do and may be able to devote greater resources to promoting and selling certain products.
In 2024, global donations through our ESI Cares program benefited over 1,000 charitable organizations, including charities who focus on human rights and humanitarian initiatives, such as Equality Now and Doctors Without Borders USA.
In 2025, global donations through our ESI Cares program benefited over 1,300 charitable organizations, including charities focused on environmental protection, mental health, human rights and humanitarian initiatives, such as The Everglades Foundation, The Alzheimer's Association, Easter Seals, and Habitat for Humanity.
Our extensive global teams of specially trained scientists and engineers develop our products, and our expert sales and service organizations ensure our customers' needs are met every day. Our continuous focus on customer-centric innovation serves as a catalyst to drive changes to existing formulations and opportunities in adjacent markets within our industry.
Our extensive global teams of specially trained scientists and engineers develop our solutions, and our expert sales and service organizations ensure our customers' needs are met every day. Our customer-centric innovation means we develop technologies to meet the already-identified needs of our current supply chains. We solve our customers' existing and emerging problems through technical service and innovation.
As part of our safety program, we host an annual Global Safety Day, which is designed to raise safety awareness through seminars, videos and targeted discussions. We also track injury and illness rates locally and maintain emergency and disaster recovery plans.
We also launched a Fall Mental Health initiative with activities ranging from yoga sessions to awareness and resilience training. As part of our safety program, we track injury and illness rates locally and maintain emergency and disaster recovery plans.
We regularly develop new products and processes and leverage our existing technologies and global footprint to profitably enter new markets. Our efforts are directed by the following key business strategies: • Commercial Excellence. We understand that reliably meeting our customers' needs through a focus on high-quality and reliable service leads to success for all parties.
Our decentralized model dictates that each of our businesses develops its own strategy tailored to its specific market opportunities; however, each of those strategies roughly falls into the following categories: • Commercial Excellence. We understand that reliably meeting our customers' needs through a focus on high-quality and reliable service leads to success for all parties.
During 2024, our research and development expenses totaled $63.0 million, which included $3.9 million of research and development costs associated with contingent consideration related to the Kuprion Acquisition. Substantially all research and development activity was performed internally. Competitive Environment Our markets are competitive and subject to rapid changes in technology.
During 2025, our research and development expenses totaled $67.6 million. Substantially all research and development activity was performed internally. Competitive Environment Our markets are competitive and subject to rapid changes in technology. Our businesses provide solutions in markets across the electronics value chain, general metal and plastic finishing, and offshore oil and gas exploration and production.
Our businesses compete in markets for specialty chemicals for electronic applications, general metal and plastic finishing, offshore oil and gas exploration and production, and consumer packaging. Our businesses compete primarily on the basis of quality, technology, performance, reliability, brand, reputation, service, range of products and services and support.
Our businesses compete primarily on the basis of quality, technology, performance, reliability, brand, reputation, service, range of products and services, and support. We maintain extensive technical support and testing services for our customers and are continuously developing new products to meet their needs.
As a specialty chemical company, the success of our business is fundamentally connected to the safety of our employees. To promote worker safety, we are committed to training our workforce on workplace safety and security.
To promote worker safety, we are committed to training our workforce on workplace safety and security. As part of our safety program, we host an annual Global Safety Day during which our leaders emphasized the importance of safety through discussions, videos and targeted training.
We believe our scale and global reach in product development, marketing and formulation provide us with advantages over many competitors, allowing us to maintain our market positions and drive profitable growth. Our extensive market presence contributes to our ability to attract new customers and successfully enter new end-markets . 4 • Customer Driven Innovation.
We believe our scale and global reach provide us with advantages that together, allow us to attract talent, serve leading customers, and drive profitable growth . • Customer Driven Innovation. We work closely with our customers, OEMs and other industry participants to develop new products and identify new market opportunities.
We also believe that our existing product offerings provide many opportunities for growth in adjacent end-markets. • Stable Cash Flow and Low Capital Requirements. Our businesses typically generate high margins and require low capital expenditures which translate into high cash flow margins and returns on capital.
Our businesses typically generate high profit margins and require low capital expenditures to grow which translate into high cash flow margins and returns on capital. Instead of large investments in physical assets to sustain business or grow, we focus our investments on our technological innovation or sales and services areas.
Removed
MGS Transaction - On September 1, 2024, we entered into an agreement to sell our flexographic printing plate business, MacDermid Graphics Solutions, for approximately $325 million. MacDermid Graphics Solutions constitutes substantially all of our Graphics Solutions business within our Industrial & Specialty segment.
Added
Our customers rely on our innovation to develop new products of their own, so our capabilities help them keep up in fast-paced, high-growth markets.
Removed
Its products include chemical systems that protect and decorate metal and plastic surfaces; consumable chemicals that enable printing image transfer on flexible packaging materials; and chemistries used in water-based hydraulic control fluids in offshore energy production. The segment's products are used in the aerospace, automotive, construction, consumer electronics, consumer packaged goods and oil and gas production end-markets.
Added
MGS Transaction - On February 28, 2025, we completed the sale of our flexographic printing plate business, MacDermid Graphics Solutions, for $320 million, net of disposed cash. MacDermid Graphics Solutions was reported within the Specialties segment. The sale resulted in a gain of $66.5 million.
Removed
As a supplier of consumable materials used to transfer images onto consumer packaging materials, our products are used to improve print quality and printing productivity. We produce and market photopolymers through an extensive line of flexographic plates that are used in the consumer packaging and printing industries. Photopolymers are molecules that change properties upon exposure to light.
Added
EFC Acquisition - On January 2, 2026, we completed the acquisition of EFC Gases & Advanced Materials, a provider of high-purity specialty gases and other advanced materials, for a purchase price of approximately $369 million, net of cash and subject to adjustments, with a potential earn-out based on EFC's 2026 performance of up to $30.0 million cash or 1.16 million Company shares. 1 Micromax Acquisition - On February 2, 2026, we completed the acquisition of Micromax, a global supplier of advanced electronics inks and pastes, for a purchase price of approximately $500 million, net of cash and subject to adjustments.
Removed
Flexography is a printing process that utilizes flexible printing plates made of rubber or other flexible plastics. We believe growth in this business will be driven by consumer demand and market shifts favoring the use of package imaging technologies that, like ours, offer a lower total cost of ownership to customers.
Added
Other than the names, there were no changes to the composition of the businesses that make up each segment in the fourth quarter of 2025. However, EFC will be reported in the Specialties segment and Micromax will be reported in the Electronics segment beginning in the first quarter of 2026.
Removed
We believe our growth in this business will be driven by continued capital expenditures in energy exploration and production.
Added
The segment's products are used in the aerospace, automotive, construction, consumer electronics and oil and gas production end-markets. On February 28, 2025, we completed the sale of our flexographic printing plate business, MacDermid Graphics Solutions. Graphics Solutions' net sales before the disposition represented approximately 3% of the segment's 2025 net sales.
Removed
Graphics Solutions Solid Sheet Printing Elements Solid sheet printing elements are digital and analog printing sheets, used in the flexographic printing and plate-making processes. Our extensive line of LUX flexographic plates, including our LUX ITP 60 plate, are used in the commercial packaging, letterpress newspaper and publication industries.
Added
Our investment decisions will be driven by comparing relative and absolute risk adjusted returns expectations. 5 Customers Our businesses have diverse customer bases and sell products either directly to end-user customers or through intermediaries.
Removed
Liquid Imaging Products Liquid imaging products are liquid photopolymers used to produce printing plates for transferring images onto commercial packaging. Our key products are LTL photopolymer , M Clear photopolymer and M Stamp 40 photopolymer . We also offer products that are used in the production of liquid photopolymer plates, such as substrate, coverfilms and detergents.
Added
These core behaviors are the foundation of our organization and pave the path for our success. We believe they reinforce our strategic objectives and empower our employees in their day-to-day work and when serving and engaging with our customers globally.
Removed
This past year, we focused on reducing lost time injuries ("LTI"), by improving our root cause analysis process and closing time for identified findings. As a result, we were able to reduce our LTI rate by nearly 13% in 2024.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeAt December 31, 2024, the aggregate equity-based awards outstanding under both plans were as follows: • 3,939,584 RSUs with each RSU representing a contingent right to receive one share of our common stock or, for performance-based RSUs, multiple shares depending upon the underlying performance metrics and our performance during the applicable performance period; and • 367,704 options which are all vested and exercisable at any time at the option of the holder to purchase shares of our common stock, on a one-for-one basis.
Biggest changeAt December 31, 2025, the aggregate equity-based awards outstanding under both plans was 1,996,366 RSUs with each RSU representing a contingent right to receive one share of our common stock or, for performance-based RSUs, multiple shares depending upon the underlying performance metrics and our performance during the applicable performance period. 19 We may also issue additional shares of our common stock, or other securities that are convertible into or exercisable for our common stock, in connection with future acquisitions, for capital raising purposes or for other business purposes; which issuances could also result in significant dilution of ownership interest.
Such insurance does not, however, provide coverage for all liabilities, and there can be no 15 assurance that our insurance coverage will be adequate to cover claims that may arise, or that we will be able to maintain adequate insurance at rates we consider reasonable.
Such insurance does not, however, provide coverage for all liabilities, 15 and there can be no assurance that our insurance coverage will be adequate to cover claims that may arise, or that we will be able to maintain adequate insurance at rates we consider reasonable.
Failure to comply with anti-corruption laws could subject us to penalties and damage our reputation. The U.S. Foreign Corrupt Practices Act of 1977, the United Kingdom Bribery Act 2010 and similar anti-bribery laws in other jurisdictions generally prohibit companies and their intermediaries from making improper payments for the purpose of obtaining or retaining business or for other unfair advantages.
Failure to comply with anti-corruption laws could subject us to penalties and damage our reputation. The U.S. Foreign Corrupt Practices Act of 1977, the United Kingdom Bribery Act 2010 and similar anti-bribery/anti-corruption laws in other jurisdictions generally prohibit companies and their intermediaries from making improper payments for the purpose of obtaining or retaining business or for other unfair advantages.
Additional states, as well as foreign jurisdictions, have enacted or are proposing similar data protection regimes, resulting in a rapidly evolving and uncertain governing 16 landscape. Complying with these various laws and regulations is difficult and could require us to incur substantial costs or change our business practices in a manner adverse to our business.
Additional states, as well as foreign jurisdictions, 16 have enacted or are proposing similar data protection regimes, resulting in a rapidly evolving and uncertain governing landscape. Complying with these various laws and regulations is difficult and could require us to incur substantial costs or change our business practices in a manner adverse to our business.
Section 203 could prohibit or delay mergers or other takeover or change in control attempts and, accordingly, may discourage attempts to acquire us, which may negatively affect our stock price. Item 1B. Unresolved Staff Comments None. 21
Section 203 could prohibit or delay mergers or other takeover or change in control attempts and, accordingly, may discourage attempts to acquire us, which may negatively affect our stock price. 21 Item 1B. Unresolved Staff Comments None.
Any of these regulations and changes in our regulatory environment, particularly in, but not limited to, the U.S., the E.U. and China, may require significant resources and data management systems and led us to re-design our products or supply chain to ensure compliance with the applicable standards or use different types or sources of materials, which could have an adverse impact on the efficiency of our manufacturing process, the performance of our products, add greater testing lead-times for product introductions or other similar effects.
Any of these regulations and changes in our regulatory environment, particularly in, but not limited to, the U.S., the E.U. and China, may require significant resources and data management systems and lead us to re-design our products or supply chain to ensure compliance with the applicable standards or use different types or sources of materials, which could have an adverse impact on the efficiency of our manufacturing process, the performance of our products, add greater testing lead-times for product introductions or other similar effects.
Our stock price may experience substantial price volatility as a result of many factors, including, without limitation, coverage or sentiment in the media or the investment community; speculation; announcement of acquisitions or divestitures; quarterly financial results and comparisons to estimates by the investment community or financial outlook provided by us; issuance of additional debt or equity; changes in key personnel or business strategy; material litigation or governmental investigations; and expectations regarding capital allocation, including any future shares repurchases and/or any future dividend payments, or any determination to cease repurchasing stock or paying dividends.
Our stock price may experience substantial price volatility as a result of many factors, including, without limitation, coverage or sentiment in the media or the investment community; speculation; announcement of acquisitions or divestitures; quarterly financial results and comparisons to estimates by the investment community or financial outlook provided by us; issuance of additional debt or equity; changes in key personnel or business strategy; material litigation or governmental investigations; and expectations regarding capital allocation, including any future stock repurchases and/or any future dividend payments, or any determination to cease repurchasing stock or paying dividends.
Other indicators that may signal that an asset has become impaired include changes in our strategy for our overall business or use of acquired assets, unexpected negative industry or economic trends, decreased market capitalization relative to net book values, prolonged decline in the value of our stock price, unanticipated competitive activities, change in consumer demand, loss of key personnel and/or acts by governments and judicial courts.
Indicators that may signal that an asset has become impaired include changes in our strategy for our overall business or use of acquired assets, unexpected negative industry or economic trends, decreased market capitalization relative to net book values, prolonged decline in the value of our stock price, unanticipated competitive activities, change in consumer demand, loss of key personnel and/or acts by governments and judicial courts.
We have operations, assets and/or generate sales in countries all over the world, including countries that are or may become the target of trade and economic restrictions from the U.S. and/or other countries, which we refer to collectively as “Economic Sanctions Laws.” Economic Sanctions Laws are complex and change with time as international relationships and confrontations between and among nations evolve.
We have operations, assets and/or generate sales in countries all over the world, including countries that are or may become the target of trade and economic restrictions from the U.S. and/or other countries, which we refer to collectively as “Economic Sanctions Laws.” Economic Sanctions Laws are complex and change over time as international relationships and confrontations between and among nations evolve.
F ailure by us or our intermediaries to comply with applicable anti-corruption laws may result in civil and/or criminal penalties or other sanctions, including disgorgement of profits and contract suspensions or cancellations, any of which could damage our reputation and have a material adverse effect on our business, financial condition or results of operations.
F ailure by us or our intermediaries to comply with applicable anti-bribery/anti-corruption laws may result in civil and/or criminal penalties or other sanctions, including disgorgement of profits and contract suspensions or cancellations; any of which could damage our reputation and have a material adverse effect on our business, financial condition or results of operations.
If we cannot provide financial reports in a timely and reliable manner, or prevent fraud, our business and operating results could be harmed, investors could lose confidence in our reported financial information, and our stock price could drop significantly. We are dependent on cash flows from our operating subsidiaries to fund our debt obligations, capital expenditures and ongoing operations.
If we cannot provide financial reports in a timely and reliable manner, or prevent fraud, our business and operating results could be harmed, investors could lose confidence in our reported financial information, and our stock price could drop significantly. 20 We are dependent on cash flows from our operating subsidiaries to fund our debt obligations, capital expenditures and ongoing operations.
Those hazards could result in personal injury and loss of life, severe damage to, or destruction of, property and equipment, pollution or environmental damage and suspension of operations. A catastrophic occurrence at a location where our products are used may expose us to substantial liability for personal injury, wrongful death, product liability or commercial claims.
Those hazards could result in personal injury and loss of life, severe damage to, or destruction of, property and equipment, pollution or environmental damage and suspension of operations. A catastrophic occurrence at a location where our products are used may expose us to substantial liability for personal injury, wrongful death, product liability, commercial claims and reputational damage.
Under these laws, companies may also be held liable for actions taken by third-parties acting on their behalf, such as strategic or local partners or representatives. Our policies mandate compliance with these anti-bribery laws, including the requirements to maintain accurate information and internal controls.
Under these laws, companies may also be held liable for actions taken by third-parties acting on their behalf, such as strategic or local partners or representatives. Our policies mandate compliance with these anti-bribery/anti-corruption laws, including the requirements to maintain accurate information and internal controls.
We are likewise required, on a quarterly basis, to evaluate the effectiveness of our internal controls and to disclose any material changes and material weaknesses in those internal controls. We have in the past experienced, and in the future may experience again, material weaknesses and potential problems in implementing and maintaining adequate internal controls as 20 required by the SEC.
We are likewise required, on a quarterly basis, to evaluate the effectiveness of our internal controls and to disclose any material changes and material weaknesses in those internal controls. We have in the past experienced, and in the future may experience again, material weaknesses and potential problems in implementing and maintaining adequate internal controls as required by the SEC.
We depend on information technology systems throughout the Company to, among other functions, control our manufacturing processes, process orders and bill, collect and make payments, interact with customers and suppliers, manage inventory and 18 otherwise conduct business.
We depend on information technology systems throughout the Company to, among other functions, control our manufacturing processes, process orders and bill, collect and make payments, interact with customers and suppliers, manage inventory and otherwise conduct business.
The failure of our information technology systems to perform as we anticipate, including as a result of significant network or power outages, could disrupt our business and result in transaction errors, processing inefficiencies and the loss of sales and customers.
The failure of our information technology systems to perform as we anticipate, including as a result of significant network or power outages, could disrupt our business 18 and result in transaction errors, processing inefficiencies and the loss of sales and customers.
If our subsidiaries are unable to generate sufficient cash flows or if we are unable to repatriate earnings effectively, or if we are unable to do so without incurring substantial costs, we may be unable to service our debt obligations, pay our expenses and/or meet our operating cash requirements or to make future dividend payments or shares repurchases, if any.
If our subsidiaries are unable to generate sufficient cash flows or if we are unable to repatriate earnings effectively, or if we are unable to do so without incurring substantial costs, we may be unable to service our debt obligations, pay our expenses and/or meet our operating cash requirements or to make future dividend payments or stock repurchases, if any.
Such regulations include the European Union's REACH (Registration, Evaluation, Authorization, and Restriction of Chemicals), which mandate compliance obligations and restrictions on certain chemicals; REACH-like regimes, which have now been adopted in several other countries; the E.U. Poison Center Notification (PCN); the U.S.
Such regulations include the European Union's REACH (Registration, Evaluation, Authorization, and Restriction of Chemicals), which mandates compliance obligations and restrictions on certain chemicals; REACH-like regimes, which have now been adopted in several other countries; the E.U. Poison Center Notification (PCN); the U.S.
As a result, we face certain risks inherent in international trade which may reduce our sales and harm our business, including: • political uncertainties, war, terrorism and other instability risks and their impact on the global economy, market conditions and supply chain operations, including risks caused by the war in Ukraine, the Israel-Hamas conflict and other hostilities in the Middle East, and the increased tariffs and trade restrictions between China and the U.S.; • changes in global or local economic conditions, including inflation, hyperinflation, fluctuations in interest rates and other increasing price levels in certain sectors, such as energy, impacting availability and cost of goods and services; • fluctuations in currency values and currency exchange rates for countries in, or with which, we conduct business; • changes or uncertainty in international, national or local legal environments, including tax, data handling, privacy, intellectual property, consumer protection, environmental and antitrust laws; • adverse tax consequences, including as a result of changes in taxation and regulatory requirements, transfer pricing practices involving our foreign operations, and additional withholding taxes or other taxes on foreign income; • foreign exchange controls or other currency restrictions and limitation on the movement of funds, potentially leading to the inability to readily repatriate earnings from foreign operations effectively; • natural disasters, extreme weather events, regional or global health concerns, such as outbreaks of COVID 19 or its variants; • establishing and maintaining relationships with local distributors and OEMs; • governmental regulations and/or sanctions affecting the import and export of products, including global trade barriers, additional taxes, tariff increases, cash repatriation restrictions, retaliations and boycotts between the U.S. and other countries, including Mexico, Russia and China; • import and export control and licensing requirements; risk of non-compliance with the Foreign Corrupt Practices Act of 1977, U.S. export control and trade sanction laws, SEC rules regarding conflict minerals sourcing and other similar anti-corruption and international trade laws or regulations in other jurisdictions; • greater difficulty in safeguarding intellectual property than in the U.S.; • difficulty in staffing and managing geographically diverse operations and ensuring compliance with our policies and procedures; and • challenges in maintaining an effective internal control environment, including language and cultural differences, varying levels of GAAP expertise and internal control over financial reporting.
As a result, we face certain risks inherent in international trade which may reduce our sales and harm our business, including: • political uncertainties, war, terrorism and other instability risks and their impact on the global economy, market conditions and supply chain operations, including risks caused by the war in Ukraine and other hostilities in the Middle East, and countervailing tariffs imposed by foreign governments on U.S. products; • changes in global or local economic conditions, including inflation, hyperinflation, fluctuations in interest rates and other increasing price levels in certain sectors, such as energy, impacting availability and cost of goods and services; • fluctuations in currency values and currency exchange rates for countries in, or with which, we conduct business; • changes or uncertainty in international, national or local legal environments, including tax, data handling, privacy, intellectual property, consumer protection, environmental and antitrust laws; • adverse tax consequences, including as a result of changes in taxation and regulatory requirements, transfer pricing practices involving our foreign operations, and additional withholding taxes or other taxes on foreign income; • foreign exchange controls or other currency restrictions and limitation on the movement of funds, potentially leading to the inability to readily repatriate earnings from foreign operations effectively; • natural disasters, extreme weather events, regional or global health concerns; • establishing and maintaining relationships with local distributors and OEMs; • governmental regulations and/or sanctions affecting the import and export of products, including global trade barriers, additional taxes, countervailing tariffs, tariff increases, cash repatriation restrictions, retaliations and boycotts between the U.S. and other countries, including Mexico, Russia and China; • import and export control and licensing requirements; risk of non-compliance with the Foreign Corrupt Practices Act of 1977, U.S. export control and trade sanction laws, SEC rules regarding conflict minerals sourcing and other similar anti-corruption and international trade laws or regulations in other jurisdictions; • greater difficulty in safeguarding intellectual property than in the U.S.; • difficulty in staffing and managing geographically diverse operations and ensuring compliance with our policies and procedures; and • challenges in maintaining an effective internal control environment, including language and cultural differences, varying levels of GAAP expertise and internal control over financial reporting.
Natural or human-induced disasters, such as earthquakes, tsunamis, floods, hurricanes, cyclones or typhoons, fires, power or water shortages, telecommunications failures, terrorist acts, civil unrest, conflicts or wars, and epidemics, pandemics or other health crises, such as the COVID 19 pandemic, could seriously harm our operations as well as the operations of our customers and suppliers.
Natural or human-induced disasters, such as earthquakes, tsunamis, floods, hurricanes, cyclones or typhoons, fires, power or water shortages, telecommunications failures, terrorist acts, civil unrest, conflicts or wars, and epidemics, pandemics or other health crises could seriously harm our operations as well as the operations of our customers and suppliers.
The specialty chemical industry is subject to constant and rapid technological change, product obsolescence, price erosion, evolving standards, finite product lifecycles, raw material price fluctuations, and changes in product supply and demand.
The specialty chemicals industry is subject to constant and rapid technological change, product obsolescence, price erosion, evolving standards, finite product lifecycles, raw material price fluctuations, and changes in product supply and demand.
The availability and prices of raw materials may be subject to curtailment or change due to, among other things, the financial stability of our suppliers, new laws and regulations, protectionist nationalistic trade policies and practices, changes in exchange rates and worldwide price levels.
The availability and prices of raw materials may be subject to curtailment or change due to, among other things, the financial stability of our suppliers, new laws and regulations, protectionist nationalistic trade policies and practices, such as tariffs, changes in exchange rates and worldwide price levels.
However, a large portion of our net sales (approximately 77% in 2024) are generated by our non-U.S. operations, which means that we have net sales, substantial assets, liabilities and costs denominated in currencies other than the U.S. dollar. To prepare our Consolidated Financial Statements, we must translate those sales, assets, liabilities and expenses into U.S. dollars at then-applicable exchange rates.
However, a large portion of our net sales (approximately 79% in 2025) are generated by our non-U.S. operations, which means that we have net sales, substantial assets, liabilities and costs denominated in currencies other than the U.S. dollar. To prepare our Consolidated Financial Statements, we must translate those sales, assets, liabilities and expenses into U.S. dollars at then-applicable exchange rates.
The failure to attract and retain key personnel, or effectively manage succession, could have an adverse material impact on our business, financial condition or results of operations. 11 In addition, we are highly dependent on the experience and track records of Sir Martin E. Franklin, our other Board members and our executive leadership team.
The failure to attract and retain key personnel, or effectively manage succession, could have a material adverse effect on our business, financial condition or results of operations. 11 In addition, we are highly dependent on the experience and track records of Sir Martin E. Franklin, our other Board members and our executive leadership team.
The due diligence we conduct in connection with an acquisition, the controls and policies we implement and any contractual guarantees or indemnities that we receive from the sellers of acquired companies or assets may not be sufficient to protect us from, or compensate us for, actual liabilities.
The due diligence we conduct in connection with an acquisition, the controls and policies we implement and any contractual guarantees or indemnities that we receive from the sellers of acquired companies or assets, or any third-party insurance we may procure, may not be sufficient to protect us from, or compensate us for, actual liabilities.
Global Regulations Changes in our effective tax rate, tax cost and tax liabilities could adversely affect our financial condition, results of operations and liquidity. In 2024, approximately 77% of our net sales were generated outside of the U.S.
Global Regulations Changes in our effective tax rate, tax cost and tax liabilities could adversely affect our financial condition, results of operations and liquidity. In 2025, approximately 79% of our net sales were generated outside of the U.S.
Our products are manufactured, formulated, distributed and sold globally. In 2024, approximately 77% of our net sales were generated from non-U.S. operations.
Our products are manufactured, formulated, distributed and sold globally. In 2025, approximately 79% of our net sales were generated from non-U.S. operations.
Item 1A. Risk Factors The following discussion of "risk factors" identifies the material factors that may adversely affect our business, financial condition or results of operations. Potential investors should carefully consider these risks and the other information in this 2024 Annual Report when evaluating our business.
Item 1A. Risk Factors The following discussion of "risk factors" identifies the material factors that may have a material adverse effect on our business, financial condition or results of operations. Potential investors should carefully consider these risks and the other information in this 2025 Annual Report when evaluating our business.
There can be no assurance that our distributors will focus adequate resources on selling our products to end users, or will be successful in selling our products, which could materially adversely affect our business, financial condition or results of operations.
There can be no assurance that our distributors will focus adequate resources on selling our products to end users, or will be successful in selling our products, which could have a material adverse effect on our business, financial condition or results of operations.
As a result of our historical acquisitions, as of December 31, 2024, we had approximately $2.86 billion of intangible assets and goodwill. Under GAAP, we review our intangible assets and long-lived assets for impairment when events or changes in circumstances indicate the carrying value may not be recoverable.
As a result of our historical acquisitions, as of December 31, 2025, we had approximately $2.90 billion of intangible assets and goodwill. Under GAAP, we review our intangible assets and long-lived assets for impairment when events or changes in circumstances indicate the carrying value may not be recoverable. Additionally, goodwill is subject to an impairment test at least annually.
If we don't successfully execute our go-to-market strategy, our business and financial performance may suffer. Our go-to-market strategy is focused on leveraging our existing portfolio of products and services as well as introducing new products and services to meet the demands of our customers in a continually changing technological landscape.
Our go-to-market strategy is focused on leveraging our existing portfolio of products and services as well as introducing new products and services to meet the demands of our customers in a continually changing technological landscape.
Further, requirements for tracking and reporting ESG matters continue to multiply, and our processes and controls for reporting across our operations and supply chain are evolving in accordance with multiple disparate standards, in the U.S. and in foreign countries.
Further, requirements for tracking and reporting ESG matters continue to multiply, and our processes and controls for reporting across our operations and supply chain are evolving in accordance with multiple disparate standards, in the U.S. and in foreign countries. These new disclosure requirements, which include climate bills in California, the EU's CSRD, its transposition in E.U. countries, the E.U.
We have numerous equity instruments outstanding that could require the future issuance of additional shares of common stock, which issuance could result in significant dilution of ownership interests and have an adverse effect on our stock price. Upon stockholders' approval on June 4, 2024, our 2024 Plan replaced our 2013 Plan, under which no further awards can be granted.
We have numerous equity instruments outstanding that could require the future issuance of additional shares of common stock, which issuance could result in significant dilution of ownership interests and have an adverse effect on our stock price.
However, outstanding awards under our 2013 Plan continue to vest in accordance with their terms and those of the 2013 Plan. Under our new 2024 Plan, an additional 10,000,000 shares were reserved for issuance in connection with the vesting of equity-based awards to be granted to our officers, other employees and directors.
Under our 2024 Plan, 10,000,000 shares were reserved for issuance in connection with the vesting of equity-based awards to be granted to our officers, other employees and directors. No further awards can be granted under our 2013 Plan, which was replaced by our 2024 Plan.
For example, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) and the U.S. State Department monitors trade restrictions and economic sanctions and impose penalties upon U.S. persons and entities and, in some instances, non-U.S. entities, for conducting activities or transacting business with certain countries as well as governments, entities, or individuals subject to Economic Sanctions Laws.
These agencies coordinate, administer and enforce penalties upon U.S. persons and/or entities and, in some instances, non-U.S. entities, for conducting activities or transacting business with certain countries as well as governments, entities, or individuals subject to Economic Sanctions Laws.
In addition, our competitors could enter into exclusive arrangements with our existing or potential customers or suppliers which could limit our ability to generate sales, acquire necessary raw materials and/or significantly increase costs. In addition, the markets in which we operate are driven by consumer preferences that are rapidly changing as well as frequent new product introductions and improvements.
In addition, our competitors could enter into exclusive arrangements with our existing or potential customers or suppliers; each of which could limit our ability to generate sales, acquire necessary raw materials and/or significantly increase costs.
This number of shares will be increased by the number of shares subject to awards under our 2013 Plan which are forfeited, cancelled, expired or otherwise terminated. The issuance of additional shares upon satisfaction of the applicable vesting conditions under the 2013 Plan or the 2024 Plan 19 could result in a stockholder's percentage ownership being diluted.
The issuance of additional shares upon satisfaction of the applicable vesting conditions under the 2013 Plan or the 2024 Plan could result in a stockholder's percentage ownership being diluted.
Our inability to anticipate customers’ changing needs or adapt to emerging technological and business trends accurately, control research and development costs or execute our innovation strategy could adversely affect our ability to sustain our market positions and/or penetrate new markets. Consolidation of our competitors could also place us at a competitive disadvantage and reduce our profitability.
We seek to provide products tailored to the often-unique needs of our customers which require an ongoing level of innovation. Our inability to anticipate customers’ changing needs or adapt to emerging technological and business trends accurately, control research and development costs or execute our innovation strategy could adversely affect our ability to sustain our market positions and/or penetrate new markets.
These new disclosure requirements, which include climate bills in California, the EU's recently adopted CSRD, its transposition in E.U. countries, the E.U. Taxonomy for sustainable activities, and any final rules that may be approved by the SEC, may negatively impact our business by diverting time, focus and resources.
Taxonomy for sustainable activities, and any final rules that may be approved by the SEC, may negatively impact our business by diverting time, focus and resources.
We operate in industries which are fragmented on a global scale, but in which there has been a trend toward consolidation in recent years. Consolidations of our competitors may jeopardize the strength of our positions in one or more of our markets which could adversely affect our business, financial condition or results of operations as well as our growth potential.
Consolidations of our competitors may jeopardize the strength of our positions in one or more of our markets which could adversely affect our business, financial condition or results of operations as well as our growth potential. If we don't successfully execute our go-to-market strategy, our business and financial performance may suffer.
However, in certain of the jurisdictions where we conduct business, we face a heightened risk for corruption, extortion, bribery, pay-offs, theft and other improper practices. There can be no assurance that our internal control policies and procedures will protect us from acts committed by our employees or agents.
However, in certain of the jurisdictions where we conduct business, we face a heightened risk for corruption, extortion, bribery, pay-offs, theft and other improper practices , including via third-party distributors over whom we may have limited or no control .
Our Credit Agreement provides for senior secured credit facilities in an initial aggregate principal amount of $1.42 billion, consisting of term loans B-3 of $1.04 billion maturing in 2030 and a revolving facility of $375 million maturing in 2027.
We and our subsidiaries may be able to incur significant additional indebtedness in the future. Our Credit Agreement provides for senior secured credit facilities, consisting of term loans B-3 of $1.29 billion maturing in 2030 and a revolving facility of $500 million maturing in 2031.
Tariffs and other changes in U.S. trade policy have in the past and could in the future trigger retaliatory actions by affected countries, and certain foreign governments have instituted or are considering imposing retaliatory measures on certain U.S. goods.
Tariffs and other changes in U.S. trade policy have in the past and could in the future trigger retaliatory actions by affected countries, and certain foreign governments have imposed and may continue to impose new tariffs, trade restrictions and export restrictions, which may negatively impact end-user demand or restrict our ability to sell products.
As a result, we must develop new products and services that offer distinct value to our customers in order to compete successfully. We seek to provide products tailored to the often-unique needs of our customers which require an ongoing level of innovation.
In addition, the markets in which we operate are driven by consumer preferences that are rapidly changing as well as frequent new product introductions and improvements. As a result, we must develop new products and services that offer distinct value to our customers in order to compete successfully.
Removed
At December 31, 2024, we had $1.04 billion outstanding under the term loans and full availability of our unused borrowing capacity of $368 million, net of letters of credit, under the revolving facility. We and our subsidiaries may incur significant additional indebtedness in the future.
Added
Consolidation of our competitors could also place us at a competitive disadvantage and reduce our profitability. We operate in industries which are fragmented on a global scale, but in which there has been a trend toward consolidation in recent years.
Removed
For example, considering Graphics Solutions' lower than expected results, we conducted an interim impairment test on this reporting unit in the third quarter of 2023 which resulted in an impairment charge of $80.0 million.
Added
There can be no assurance that our internal control policies and procedures will protect us from acts committed by our employees or agents.
Removed
We may also issue additional shares of our common stock, or other securities that are convertible into or exercisable for our common stock, in connection with future acquisitions, for capital raising purposes or for other business purposes; which issuances could also result in significant dilution of ownership interest. Volatility of our stock price could adversely affect us and our stockholders.
Added
For example, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) and the U.S. State Department monitor trade restrictions and economic sanctions.
Added
At February 18, 2026, we had $373 million, net of letters of credit, of borrowing capacity under our revolving facility.
Added
However, outstanding awards under our 2013 Plan continue to vest in accordance with their terms and those of the 2013 Plan. In addition, the number of shares reserved under our 2024 Plan is periodically increased by the number of shares subject to awards under our 2013 Plan which are forfeited, cancelled, expired or otherwise terminated.
Added
Volatility of our stock price could adversely affect us and our stockholders.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe also engage with providers of information systems as part of our continuing efforts to enhance the effectiveness of our security measures. Our vendor risk management (VRM) program, through which we screen external providers, helps us identify and evaluate known risks associated with these third parties.
Biggest changeWe engage with providers of information systems as part of our continuing efforts to enhance the effectiveness of our security measures. We also regularly conduct cyber incident response simulations designed to test our organization's preparedness to a cybersecurity event.
The cybersecurity expertise of our CISO and his team includes information security management as well as governance, risk and compliance (GRC) roles, hands-on cyber incident response experience, forensic and network intrusion investigations and security risk assessments.
The cybersecurity expertise of our CISO and his team includes information security management as well as governance, risk and compliance roles, hands-on cyber incident response experience, forensic and network intrusion investigations and security risk assessments.
Our information security program is led by our Chief Information Security Officer (CISO) who manages a global information security team responsible for assessing and mitigating cyber-related threats.
Our vendor risk management (VRM) program, through which we screen external providers, helps us identify and evaluate potential risks associated with these third parties. Our information security program is led by our Chief Information Security Officer (CISO) who manages a global information security team responsible for assessing and mitigating cyber-related threats.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties At December 31, 2024, our physical presence included 51 manufacturing sites, of which 12 included research facilities, and 9 stand-alone research centers. Of our manufacturing facilities, 8 were located in the U.S. with the remaining international facilities located primarily in Asia and Europe.
Biggest changeItem 2. Properties At December 31, 2025, our physical presence included 47 manufacturing facilities, of which 11 included research facilities, and 8 stand-alone research centers. Of our manufacturing facilities, 7 were located in the U.S. with the remaining international facilities located primarily in Asia and Europe.
See Note 7, Property, Plant and Equipment, Net , to the Consolidated Financial Statements included in this 2024 Annual Report for amounts invested in land, buildings, machinery, and equipment, and Note 17, Leases , to the Consolidated Financial Statements included in this 2024 Annual Report for information about our operating lease commitments.
See Note 7, Property, Plant and Equipment, Net , to the Consolidated Financial Statements included in this 2025 Annual Report for amounts invested in land, buildings, machinery, and equipment, and Note 17, Leases , to the Consolidated Financial Statements included in this 2025 Annual Report for information about our operating lease commitments.
We owned 26 of our manufacturing facilities, of which 6 included research facilities, and 2 stand-alone research centers. In addition to the remaining manufacturing and research facilities, we leased the majority of our office, warehouse and other physical locations.
We owned 25 of our manufacturing facilities, of which 5 included research facilities, and 2 stand-alone research centers. In addition to the remaining manufacturing and research facilities, we leased the majority of our office, warehouse and other physical locations.
Among our two segments, Electronics and Industrial & Specialty utilize 21 and 17 of our manufacturing facilities, respectively, with the remaining 13 manufacturing facilities being shared between the two segments. We believe that all of our significant facilities and equipment are in good condition, well-maintained, adequate for our present operations and utilized for their intended purposes.
Between our two segments, Electronics and Specialties exclusively utilize 21 and 13 of our manufacturing facilities, respectively, with the remaining 13 manufacturing facilities being shared between the two segments. We believe that all of our significant facilities and equipment are in good condition, well-maintained, adequate for our present operations and utilized for their intended purposes.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeAt other sites, we have been named as a potential responsible party pursuant to the federal Superfund Act and/or state Superfund laws comparable to the federal law for site remediation. Based on currently available information, we do not anticipate any material losses in excess of the liabilities recorded.
Biggest changeWe engage or participate in remedial and other environmental compliance activities at certain of these sites. At other sites, we have been named as a potential responsible party pursuant to the federal Superfund Act and/or state Superfund laws comparable to the federal law for site remediation.
Due to their inherent uncertainty, however, there can be no assurance as to the ultimate outcome of current or future legal proceedings, investigations or claims and it is possible that a resolution of one or more such matters could result in fines and penalties that could adversely affect our business, financial condition or results of operations.
Due to their inherent uncertainty, however, there can be no assurance as to the ultimate outcome of current or future legal proceedings, investigations or claims and it is possible that a resolution of one or more such matters could result in fines and penalties that could adversely affect our business, financial condition or results of operations. 22 In addition, we are involved in various claims relating to environmental matters at current and former plant sites and waste management sites.
However, it is possible that, as additional information becomes available, the impact of an adverse determination could have a different effect. For additional information regarding environmental matters and liabilities, see Note 18, Contingencies, Environmental and Legal Matters , to the Consolidated Financial Statements included in this 2024 Annual Report. 22 Item 4. Mine Safety Disclosure Not applicable. 23 Part II
For additional information regarding environmental matters and liabilities, see Note 18, Contingencies, Environmental and Legal Matters , to the Consolidated Financial Statements included in this 2025 Annual Report. Item 4. Mine Safety Disclosure Not applicable. 23 Part II
Removed
In addition, we are involved in various claims relating to environmental matters at current and former plant sites and waste management sites. We engage or participate in remedial and other environmental compliance activities at certain of these sites.
Added
Based on currently available information, we do not anticipate any material losses in excess of the liabilities recorded. However, it is possible that, as additional information becomes available, the impact of an adverse determination could have a different effect.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePerformance Graph The following graph shows a comparison of cumulative total stockholder returns for our common stock, the Standard and Poor's 500 Index and the S&P 500 Specialty Chemicals Index from December 31, 2019 through December 31, 2024, assuming a $100 investment in our common stock on December 31, 2019 and the reinvestment of all dividends thereafter. 24 The stock performance shown on this graph is based on historical data and is not indicative of, or intended to forecast, possible future performance of our common stock.
Biggest changePerformance Graph The following graph shows a comparison of cumulative total stockholder returns for our common stock, the Standard and Poor's (S&P) 500 Index, the S&P SmallCap 600 Index, the S&P 500 Specialty Chemicals Index and the S&P SmallCap 600 Specialty Chemicals Index from December 31, 2020 through December 31, 2025, assuming a $100 investment in our common stock on December 31, 2020 and the reinvestment of all dividends thereafter.
Dividends We declared and paid cash dividends on our common stock of $78.2 million, $77.4 million and $78.4 million during the years ended December 31, 2024, 2023 and 2022, respectively. On February 12, 2025, our Board declared a cash dividend of $0.08 per outstanding share of our common stock.
Dividends We declared and paid cash dividends on our common stock of $77.8 million, $78.2 million and $77.4 million during the years ended December 31, 2025, 2024 and 2023, respectively. On February 10, 2026, our Board declared a cash dividend of $0.08 per outstanding share of our common stock.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market for our Common Stock Our common stock is traded on the New York Stock Exchange under the symbol “ESI.” On February 14, 2025, there were approximately 154 registered holders of record of our common stock, par value $0.01 per share, and the closing price of our common stock was $26.13.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market for our Common Stock Our common stock is traded on the New York Stock Exchange under the symbol “ESI.” On February 12, 2026, there were approximately 141 registered holders of record of our common stock, par value $0.01 per share, and the closing price of our common stock was $32.12.
Equity Compensation Plan Information The information regarding our equity compensation plans will be included in the 2025 Proxy Statement under the heading "Executive Compensation Tables - Equity Compensation Plan Information," and is incorporated by reference into this 2024 Annual Report. Recent Sales of Unregistered Securities None. Issuer Purchases of Equity Securities None. Item 6. [Reserved] 25
Equity Compensation Plan Information The information regarding our equity compensation plans will be included in the 2026 Proxy Statement under the heading "Executive Compensation Tables - Equity Compensation Plan Information," and is incorporated by reference into this 2025 Annual Report. Recent Sales of Unregistered Securities None.
The dividend is expected to be paid on March 17, 2025 to stockholders of record at the close of business on March 3, 2025.
The dividend is expected to be paid on March 16, 2026 to stockholders of record at the close of business on March 2, 2026.
Added
In 2025, the Company was added to the S&P SmallCap 600 Index and the S&P SmallCap 600 Specialty Chemicals Index.
Added
As a result, these indices were included in the graph of this 2025 Annual Report as more representative of our stock performance. 24 The stock performance shown on this graph is based on historical data and is not indicative of, or intended to forecast, possible future performance of our common stock.
Added
Issuer Purchases of Equity Securities During the three months ended December 31, 2025, we repurchased the following shares of our common stock: Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of a Publicly Announced Repurchase Program Approximate Dollar Value of Shares that May Yet be Purchased Under the Repurchase Program (1) (in millions) October 1 - October 31 — $ — — $ 562 November 1 - November 30 192,496 $ 23.92 192,496 $ 557 December 1 - December 31 38,068 $ 25.00 38,068 $ 556 Total 230,564 $ 24.10 230,564 (1) In November 2021, our Board of Directors increased the authorization under the Company's stock repurchase program to $750 million.
Added
The approximate dollar value of shares that may yet be purchased under the program is inclusive of any applicable brokers fees and excise tax and represents the value of shares available under the program at the end of the respective month presented.
Added
The program does not require the repurchase of any specific number of shares and shares repurchases are made opportunistically at the discretion of the Company. The program does not have an expiration date but may be suspended or terminated by the Board at any time.
Added
Shares withheld by the Company to satisfy tax withholding requirements related to the vesting of RSUs are not considered share repurchases under our stock repurchase program and, therefore, are excluded from the table above. Item 6. [Reserved] 25

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeFor a reconciliation of "Net income" to Adjusted EBITDA and more information about the adjustments made, see Note 22, Segment Information , to the Consolidated Financial Statements included in this 2024 Annual Report. 29 Results of Operations Change - 2024 vs 2023 Change - 2023 vs 2022 (dollars in millions) 2024 2023 Reported Constant Currency Organic 2022 Reported Constant Currency Organic Net sales $ 2,456.9 $ 2,333.2 5% 7% 4% $ 2,549.4 (8)% (7)% (5)% Cost of sales 1,421.2 1,414.7 0% 2% 1,596.7 (11)% (10)% Gross profit 1,035.7 918.5 13% 14% 952.7 (4)% (2)% Gross margin 42.2 % 39.4 % 280 bps 270 bps 37.4 % 200 bps 220 bps Operating expenses 691.8 744.9 (7)% (6)% 627.4 19% 19% Operating profit 343.9 173.6 98% (nm) 325.3 (47)% (41)% Operating margin 14.0 % 7.4 % 660 bps 680 bps 12.8 % (540) bps (480) bps Other expense, net (56.2) (44.5) 26% (53.3) (16)% Income tax expense (44.8) (13.0) 244% (85.8) (85)% Net income from continuing operations 242.9 116.1 (nm) 186.2 (38)% Income from discontinued operations, net of tax 1.6 2.1 (26)% 1.8 19% Net income $ 244.5 $ 118.2 (nm) $ 188.0 (37)% Net income margin 10.0 % 5.1 % 490 bps 7.4 % (230) bps Adjusted EBITDA $ 534.7 $ 482.3 11% 13% $ 526.6 (8)% (6)% Adjusted EBITDA margin 21.8 % 20.7 % 110 bps 120 bps 20.7 % 0 bps 20 bps (nm) Calculation not meaningful. 30 Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Net Sales Net sales for 2024 increased 5% on a reported basis, 7% on a constant currency basis and 4% on an organic basis.
Biggest changeFor a reconciliation of "Net income" to Adjusted EBITDA and more information about the adjustments made, see Note 22, Segment Information , to the Consolidated Financial Statements included in this 2025 Annual Report. 29 Results of Operations Change - 2025 vs 2024 Change - 2024 vs 2023 (dollars in millions) 2025 2024 Reported Constant Currency Organic 2023 Reported Constant Currency Organic Net sales $ 2,551.2 $ 2,456.9 4% 3% 6% $ 2,333.2 5% 7% 4% Cost of sales 1,480.7 1,421.2 4% 4% 1,414.7 0% 2% Gross profit 1,070.5 1,035.7 3% 3% 918.5 13% 14% Gross margin 42.0 % 42.2 % (20) bps (10) bps 39.4 % 280 bps 270 bps Operating expenses 728.3 691.8 5% 5% 744.9 (7)% (6)% Operating profit 342.2 343.9 (1)% 1% 173.6 98% (nm) Operating margin 13.4 % 14.0 % (60) bps (40) bps 7.4 % 660 bps 680 bps Other expense, net (76.6) (56.2) 36% (44.5) 26% Income tax expense (74.6) (44.8) 67% (13.0) 244% Net income from continuing operations 191.0 242.9 (21)% 116.1 (nm) Income from discontinued operations, net of tax — 1.6 (nm) 2.1 (26)% Net income $ 191.0 $ 244.5 (22)% $ 118.2 (nm) Net income margin 7.5 % 10.0 % (250) bps 5.1 % 490 bps Adjusted EBITDA $ 547.6 $ 534.7 2% 2% $ 482.3 11% 13% Adjusted EBITDA margin 21.5 % 21.8 % (30) bps (30) bps 20.7 % 110 bps 120 bps (nm) Calculation not meaningful. 30 Year Ended December 31, 2025 Compared to Year Ended December 31, 2024 Net Sales Net sales for 2025 increased 4% on a reported basis, 3% on a constant currency basis and 6% on an organic basis.
Other expense, net Other expense, net for 2024 included an $11.4 million impairment of an available-for-sale debt security, $11.0 million of net losses associated with metals derivative contracts ($15.4 million of realized losses and $4.4 million of unrealized gains) and $2.6 million of charges due to highly inflationary accounting for our operations in Turkey, partially offset by $0.2 million of debt refinancing gains related to the prepayment of our then existing term loans B-2.
Other expense, net for 2024 included an $11.4 million impairment of an available-for-sale debt security, $11.0 million of net losses associated with metals derivative contracts ($15.4 million of realized losses and $4.4 million of unrealized gains) and $2.6 million of charges due to highly inflationary accounting for our operations in Turkey, partially offset by $0.2 million of debt refinancing gains related to the prepayment of our then existing term loans B-2.
We believe the diversity of the niche end-markets we serve will enable us to continue our growth and maintain strong cash flow generation throughout economic cycles and mitigate the impact of a downturn in any single market. We will only pursue a candidate when it is deemed to be fiscally prudent and meets our acquisition criteria.
We believe the diversity of the niche end-markets we serve will enable us to continue our growth and maintain strong cash flow generation throughout economic cycles and mitigate the impact of a downturn in any single market. We will only pursue an acquisition candidate when it is deemed to be fiscally prudent and meets our acquisition criteria.
We may elect to first assess qualitative factors to determine whether it is more likely than not (greater than 50%) that the fair value of a reporting unit is less than its carrying value. Qualitative factors may include, but are not limited to, economic, market and industry conditions, cost factors, and overall financial performance of the reporting units.
We may elect to first assess qualitative factors to determine whether it is more likely than not (greater than 50%) that the fair value of a reporting unit is less than its carrying value. Qualitative factors may include, but are not limited to, economic, 27 market and industry conditions, cost factors, and overall financial performance of the reporting units.
We also believe that investors find this information helpful in understanding the ongoing performance of our operations separate from items that may have a disproportionate positive or negative impact on our financial results in any particular period or are considered to be associated with our capital structure.
We also believe that investors find this information helpful in 28 understanding the ongoing performance of our operations separate from items that may have a disproportionate positive or negative impact on our financial results in any particular period or are considered to be associated with our capital structure.
During 2024, the Company finalized the 2023 consolidated U.S. federal income tax return along with prior years amended federal corporate income tax returns related to crediting foreign taxes including the return-to-provision true-up of foreign tax credits, valuation allowances and prior year one-time benefit.
Also, during 2024, the Company finalized the 2023 consolidated U.S. federal income tax return along with prior years amended federal corporate income tax returns related to crediting foreign taxes including the return-to-provision true-up of foreign tax credits, valuation allowances and prior year one-time benefit.
The remaining unused capital loss carryforward with a full valuation allowance expired at the close of 2024. The capital gain also resulted in a higher interest expense deduction and consequentially a lower deduction for FDII and lower utilization of certain foreign tax credits before expiration.
The remaining unused capital loss carryforward with a full valuation allowance expired at the close of 2024. The capital gain also resulted in a higher interest expense deduction and, consequentially, a lower deduction for FDII and lower utilization of certain foreign tax credits carryforwards before expiration.
Non-GAAP Financial Measures To supplement our financial results presented in accordance with GAAP in this Management’s Discussion and Analysis of Financial Condition and Results of Operations section, we present certain non-GAAP financial measures, such as operating results on a constant currency and organic basis and Adjusted EBITDA.
Non-GAAP Financial Measures To supplement our financial results presented in accordance with GAAP in this Management’s Discussion and Analysis of Financial Condition and Results of Operations section, we present certain non-GAAP financial measures, such as operating results on a constant currency and organic basis, Adjusted EBITDA and Adjusted EBITDA margin.
This gain was offset by capital losses generated in 2024 totaling $10.1 million and capital loss carryforwards of $198 million. The capital gain provided income of the appropriate character to support the release of a valuation allowance on the amount of the capital loss carryforward utilized.
The gain was offset by capital losses generated in 2024 totaling $10.1 million and capital loss carryforwards of $198 million. The capital gain provided income of the appropriate character to support the release of a valuation allowance on the amount of the capital loss carryforward utilized.
Overview Element Solutions, incorporated in Delaware in January 2014, is a leading global specialty chemicals company whose businesses supply a broad range of solutions that enhance the performance of products people use every day.
Overview Element Solutions, incorporated in Delaware in January 2014, is a leading global specialty chemicals technology company whose businesses supply a broad range of solutions that enhance the performance of products people use every day.
The expected long-term rate of return on assets assumption is developed with reference to historical returns, forward-looking return expectations, the Domestic and Foreign Pension Plans' investment allocations, and peer comparisons.
The expected long-term rate of return on assets assumption is developed with reference to historical returns, forward-looking return expectations, the Domestic Pension Plans and Foreign Pension Plans' investment allocations, and peer comparisons.
If the carrying value of the net assets assigned to the reporting unit exceeds the fair value of the reporting unit, the 27 goodwill impairment loss is calculated as the difference between these amounts, limited to the amount of goodwill allocated to the reporting unit.
If the carrying value of the net assets assigned to the reporting unit exceeds the fair value of the reporting unit, the goodwill impairment loss is calculated as the difference between these amounts, limited to the amount of goodwill allocated to the reporting unit.
Comparison of Fiscal Years 2023 and 2022 For the comparison of fiscal years 2023 and 2022, see " Year Ended December 31, 2023 Compared to the Year Ended December 31, 2022 " in Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, included in our 2023 Annual Report on Form 10-K and incorporated by reference into this 2024 Annual Report.
Comparison of Fiscal Years 2024 and 2023 For the comparison of fiscal years 2024 and 2023, see " Year Ended December 31, 2024 Compared to the Year Ended December 31, 2023 " in Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, included in our 2024 Annual Report on Form 10-K and incorporated by reference into this 2025 Annual Report.
Critical Accounting Estimates The preparation of financial statements in conformity with GAAP requires us to make estimates that may significantly impact our reported financial results and accompanying disclosures. We base our estimates, assumptions and judgments on historical experience, current conditions as well as other factors that we consider reasonable.
Critical Accounting Estimates The preparation of financial statements in conformity with GAAP requires us to make estimates that may significantly impact our reported financial results and accompanying disclosures. We base our estimates, assumptions and judgments on historical experience, current conditions and other factors that we consider reasonable.
Management’s Discussion and Analysis of Financial Condition and Results of Operations This Management's Discussion and Analysis of Financial Condition and Results of Operations section should be read in conjunction with “Financial Statements and Supplementary Data” included in Part II, Item 8 of this 2024 Annual Report and our audited Consolidated Financial Statements and notes thereto included elsewhere in this 2024 Annual Report.
Management’s Discussion and Analysis of Financial Condition and Results of Operations This Management's Discussion and Analysis of Financial Condition and Results of Operations section should be read in conjunction with “Financial Statements and Supplementary Data” included in Part II, Item 8 of this 2025 Annual Report and our audited Consolidated Financial Statements and notes thereto included elsewhere in this 2025 Annual Report.
“Overview” and "2024 Highlights" briefly present our business and certain significant events addressed in this section or elsewhere in this 2024 Annual Report. This 2024 Annual Report should be read in its entirety for a complete description of our business and discussion of these events.
“Overview” and "2025 Highlights" briefly present our business and certain significant events addressed in this section or elsewhere in this 2025 Annual Report. This 2025 Annual Report should be read in its entirety for a complete description of our business and discussion of these events.
In mobile communications, computers, automobiles and aerospace equipment, its products are an integral part of the electronics manufacturing process and the functionality of end-products. The segment's "wet chemistries" for metallization, surface treatments and solderable finishes form the physical circuitry pathways and its "assembly materials," such as SMT, pastes, fluxes and adhesives, join those pathways together.
In high-performance datacenters, mobile communications, computers, automobiles and aerospace equipment, its products are an integral part of the electronics manufacturing process and the functionality of end-products. The segment's "wet chemistries" for metallization, surface treatments and solderable finishes form the physical circuitry pathways and its "assembly materials," such as SMT, pastes, fluxes and adhesives, join those pathways together.
Availability under our revolving credit facility and various lines of credit and overdraft facilities totaled $390 million at December 31, 2024 (net of $7.0 million of stand-by letters of credit which reduce our borrowing capacity).
Availability under our revolving credit facility and various lines of credit and overdraft facilities totaled $390 million at December 31, 2025 (net of $7.0 million of stand-by letters of credit which reduce our borrowing capacity).
Such adjustments are recognized in the period in which they are identified. Recent Accounting Pronouncements A summary of recent accounting pronouncements is included in Note 3, Recent Accounting Pronouncements , to the Consolidated Financial Statements included in this 2024 Annual Report.
Such adjustments are recognized in the period in which they are identified. Recent Accounting Pronouncements A summary of recent accounting pronouncements is included in Note 3, Recent Accounting Pronouncements , to the Consolidated Financial Statements included in this 2025 Annual Report.
See Note 2, Summary of Significant Accounting Policies , to the Consolidated Financial Statements included in this 2024 Annual Report for a detailed discussion of the application of these and other accounting policies.
See Note 2, Summary of Significant Accounting Policies , to the Consolidated Financial Statements included in this 2025 Annual Report for a detailed discussion of the application of these and other accounting policies.
In 2024, the estimated fair value of our reporting units was considered to be substantially in excess of their respective carrying value. See Note 8, Goodwill and Intangible Assets , Net, to the Consolidated Financial Statements included in this 2024 Annual Report for additional information.
In 2025, the estimated fair value of each of our reporting units was considered to be substantially in excess of their respective carrying value. See Note 8, Goodwill and Intangible Assets , Net, to the Consolidated Financial Statements included in this 2025 Annual Report for additional information.
Covenants At December 31, 2024, we were in compliance with the debt covenants contained in the Credit Agreement and the indenture governing our 3.875% USD Notes due 2028.
Covenants At December 31, 2025, we were in compliance with the debt covenants contained in the Credit Agreement and the indenture governing our 3.875% USD Notes due 2028.
We anticipate that any future acquisitions would be financed through a combination of cash on hand, availability under our Credit Agreement and/or new debt or equity offerings. Foreign Currency Exposure In 2024, approximately 77% of our net sales originated outside of the U.S. and were denominated in numerous currencies, including the euro and Chinese yuan.
We anticipate that any future acquisitions would be financed through a combination of cash on hand, availability under our Credit Agreement and/or new debt or equity offerings. Foreign Currency Exposure In 2025, approximately 79% of our net sales originated outside of the U.S. and were denominated in numerous currencies, including the Chinese yuan and euro.
Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions, applicable restrictions under our various financing arrangements, and other factors. During 2024, approximately 77% of our net sales were generated from non-U.S. operations, and we expect a large portion of our net sales to continue to be generated outside of the U.S.
Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions, applicable restrictions under our various financing arrangements, and other factors. During 2025, approximately 79% of our net sales were generated from non-U.S. operations, and we expect a large portion of our net sales to continue to be generated outside of the U.S.
Our product innovation and product extensions are expected to continue to drive sales growth in both new and existing markets while expanding margins through a consistent focus on increasing customer value propositions. Our operations are organized into two segments: Electronics and Industrial & Specialty.
Our product innovation and product extensions are expected to continue to drive sales growth in both new and existing markets while expanding margins through a consistent focus on increasing customer value propositions. Our operations are organized into two segments: Electronics and Specialties.
Investors are encouraged to review the definitions and reconciliations of these non-GAAP financial 28 measures to their most comparable GAAP financial measures included in this 2024 Annual Report and not to rely on any single financial measure to evaluate our business.
Investors are encouraged to review the definitions and reconciliations of these non-GAAP financial measures to their most comparable GAAP financial measures included in this 2025 Annual Report and not to rely on any single financial measure to evaluate our business.
The segment provides specialty chemical solutions through the following businesses: Assembly Solutions, Circuitry Solutions and Semiconductor Solutions. Industrial & Specialty – The Industrial & Specialty segment researches, formulates and sells specialty chemicals and material process technologies that enhance surfaces or improve industrial processes in diverse industrial sectors from automotive trim to transcontinental infrastructure and from high-speed printing to high-design faucets.
The segment provides solutions through the following businesses: Assembly Solutions, Circuitry Solutions and Semiconductor Solutions. Specialties – The Specialties segment researches, formulates and sells specialty chemicals and material process technologies that enhance surfaces or improve industrial processes in diverse industrial sectors from automotive trim to transcontinental infrastructure to high-design faucets.
Discount rates of 5.6% and 3.1% were established for the Domestic Pension Plan and Foreign Pension Plans, respectively, at December 31, 2024, compared to rates of 5.0% and 3.1% established for those respective plans at December 31, 2023.
Discount rates of 5.3% and 3.5% were established for the Domestic Pension Plan and Foreign Pension Plans, respectively, at December 31, 2025, compared to rates of 5.6% and 3.1% established for those respective plans at December 31, 2024.
Management believes Adjusted EBITDA provides investors with a more complete understanding of the long-term profitability trends of our business and facilitates comparisons of our profitability to prior and future periods.
Management believes Adjusted EBITDA and Adjusted EBITDA margin provide investors with a more complete understanding of the long-term profitability trends of our business and facilitates comparisons of our profitability to prior and future periods.
Our investment policies attempt to achieve a mix of approximately 95% of plan investments for liability-matching, 3% for long-term growth, and 2% for near-term benefit payments. The weighted average asset allocation of the Domestic Pension Plan was 95% fixed income holdings, 3% equity securities and derivatives and 2% cash at December 31, 2024.
Our investment policies attempt to achieve a mix of approximately 94% of plan investments for liability-matching, 3% for long-term growth, and 3% for near-term benefit payments. The weighted average asset allocation of the Domestic Pension Plan was 94% fixed income holdings, 3% equity securities and derivatives and 3% cash at December 31, 2025.
During 2023, we also paid $77.4 million of cash dividends on shares of our common stock and $7.7 million for shares of our common stock withheld by the Company to satisfy the tax withholding requirements related to the vesting of RSUs included in "Other, net." Pension Plans We maintain "Domestic Pension Plans," which consist of a non-contributory domestic defined benefit pension plan and Supplemental Executive Retirement Plans (SERPs).
During 2024, we also paid $78.2 million of cash dividends on shares of our common stock and $7.6 million for shares of our common stock withheld by the Company to satisfy the tax withholding requirements related to the vesting of RSUs included in "Other, net." Pension Plans We maintain "Domestic Pension Plans," which consist of a non-contributory domestic defined benefit pension plan and Supplemental Executive Retirement Plans (SERPs).
A one percent increase in the discount rate would increase the pension plan expense by approximately $0.7 million and decrease the pension benefit obligation by approximately $14.0 million, whereas a one percent decrease in the discount rate would decrease the pension plan expense by approximately $0.9 million and increase the pension benefit obligation by approximately $16.7 million.
A one percent increase in the discount rate would increase the pension plan expense by approximately $0.7 million and decrease the pension benefit obligation by approximately $13.9 million, whereas a one percent decrease in the discount rate would decrease the pension plan expense by approximately $0.9 million and increase the pension benefit obligation by approximately $15.9 million.
We may transfer cash from certain international subsidiaries to the U.S. and/or other international subsidiaries when we believe it is cost effective to do so. Of our $359 million of cash and cash equivalents at December 31, 2024, $224 million was held by our foreign subsidiaries.
We may transfer cash from certain international subsidiaries to the U.S. and/or other international subsidiaries when we believe it is cost effective to do so. Of our $627 million of cash and cash equivalents at December 31, 2025, $202 million was held by our foreign subsidiaries.
We used a long-term rate of return on plan assets of 7.0% and 3.1% for our Domestic and Foreign Pension Plans, respectively, to determine our 36 net periodic pension expense for 2024.
We 36 used a long-term rate of return on plan assets of 6.7% and 3.9% for our Domestic Pension Plans and Foreign Pension Plans, respectively, to determine our net periodic pension expense for 2025.
Financial Borrowings Credit Facilities and Senior Notes At December 31, 2024, we had $1.82 billion of indebtedness, net of unamortized discounts and debt issuance costs of $14.8 million, which primarily included: • $1.04 billion of term debt arrangements outstanding under our term loans; and • $800 million of 3.875% USD Notes due 2028.
Financial Borrowings Credit Facilities and Senior Notes At December 31, 2025, we had $1.63 billion of indebtedness, net of unamortized discounts and debt issuance costs of $10.3 million, which primarily included: • $836 million of term debt arrangements outstanding under our term loans; and • $800 million of 3.875% USD Notes due 2028.
Developed in multi-step technological processes, these innovative solutions enable customers' manufacturing processes in several key industries, including consumer electronics, power electronics, semiconductor fabrication, communications and data storage infrastructure, automotive systems, industrial surface finishing, consumer packaging and offshore energy.
Developed in multi-step technological processes, these innovative solutions enable customers' manufacturing processes in multiple high-value industries, including consumer electronics, power electronics, semiconductor fabrication, high-performance computing, communications and data storage infrastructure, automotive systems, industrial surface finishing and offshore energy.
In addition, the gain on the internal restructuring resulted in a step-up in tax basis and the Company recorded a deferred tax asset of $22.5 million on the excess of stock tax basis over book basis due to subsequent held for sale classification.
The gain resulted in a step-up in tax basis and the Company recorded a deferred tax asset of $22.5 million on the excess of stock tax basis over book basis due to the subsequent held for sale classification offset with a full valuation allowance.
Electronics' net sales for 2024 increased 10% on a reported basis, 12% on a constant currency basis and 7% on an organic basis. • Assembly Solutions : net sales increased 8% on a reported basis and 1% on an organic basis. Pass-through metals pricing had a positive impact of 8% on reported net sales.
Electronics' net sales for 2025 increased 14% on a reported basis, 14% on a constant currency basis and 10% on an organic basis. • Assembly Solutions : net sales increased 16% on a reported basis and 8% on an organic basis. Pass-through metals pricing had a positive impact of 8% on reported net sales.
For the full year 2025, we expect our capital expenditures to be approximately $65.0 million.
For the full year 2026, we expect our capital expenditures to be approximately $75.0 million.
Foreign exchange gains For the year ended December 31, 2024, the fluctuations in foreign exchange gains were primarily driven by the remeasurement of intercompany loans.
Foreign exchange (losses) gains For the year ended December 31, 2025, the fluctuations in foreign exchange (losses) and gains were primarily driven by the remeasurement of intercompany loans and working capital balances.
The Domestic Pension Plans were overfunded by $2.3 million at December 31, 2024 compared to underfunded by $8.2 million at December 31, 2023.
The Domestic Pension Plans were overfunded by $5.0 million at December 31, 2025 compared to $2.3 million at December 31, 2024.
Other expense, net for 2023 included $7.0 million of charges due to highly inflationary accounting for our operations in Turkey, $2.3 million of debt refinancing costs related to the prepayment of our then existing term loans B-1 and term loans A and $0.1 million of net losses associated with metals derivative contracts ($1.3 million of realized losses and $1.2 million of unrealized gains).
Other expense, net Other expense, net for 2025 included $47.2 million of net losses associated with metals derivative contracts ($30.5 million of realized and $16.7 million of unrealized losses), $3.6 million of charges due to highly inflationary accounting for our operations in Turkey and $1.8 million of debt extinguishment costs related to the partial prepayment of our term loans B-3 in the first quarter of 2025.
Therefore, fluctuations in foreign exchange rates in any given reporting period may positively or negatively impact our financial performance. Foreign exchange translation negatively impacted our 2024 net sales performance by approximately 2%.
Therefore, fluctuations in foreign exchange rates in any given reporting period may positively or negatively impact our financial performance. Foreign exchange translation had an immaterial impact on our 2025 net sales performance.
Each of our segments is described below: Electronics – The Electronics segment researches, formulates and sells specialty chemicals and material process technologies for all types of electronics hardware, from complex printed circuit board designs to advanced semiconductor packaging.
In 2025, we achieved net sales of $2.55 billion, to which our Electronics and Specialties segments contributed approximately 70% and 30%, respectively. Each of our segments is described below: Electronics – The Electronics segment researches, formulates and sells specialty chemicals and material process technologies for all types of electronics hardware from complex printed circuit board designs to advanced semiconductor packaging.
The following table reconciles GAAP net sales growth to constant currency and organic net sales growth: Year ended December 31, % Change (dollars in millions) 2024 2023 Reported Net Sales Growth Impact of Currency Constant Currency Pass-Through Metals Pricing Acquisitions Organic Net Sales Growth Electronics: Assembly Solutions $ 782.8 $ 726.1 8% 2% 10% (8)% —% 1% Circuitry Solutions 470.7 424.3 11% 1% 12% —% —% 12% Semiconductor Solutions 307.9 264.3 17% 1% 18% —% (3)% 14% Total $ 1,561.4 $ 1,414.7 10% 1% 12% (4)% (1)% 7% Industrial & Specialty: Industrial Solutions $ 666.4 $ 699.0 (5)% 2% (2)% —% 0% (2)% Graphics Solutions 146.2 142.7 2% 1% 3% —% —% 3% Energy Solutions 82.9 76.8 8% 0% 8% —% —% 8% Total $ 895.5 $ 918.5 (3)% 2% (1)% —% 0% (1)% Total $ 2,456.9 $ 2,333.2 5% 2% 7% (3)% 0% 4% NOTE: Totals may not sum due to rounding.
The following table reconciles GAAP net sales growth to constant currency and organic net sales growth: Year ended December 31, % Change (dollars in millions) 2025 2024 Reported Net Sales Growth Impact of Currency Constant Currency Pass-Through Metals Pricing Divestitures Organic Net Sales Growth Electronics: Assembly Solutions $ 907.1 $ 782.8 16% 0% 16% (8)% —% 8% Circuitry Solutions 527.8 470.7 12% (2)% 10% —% —% 10% Semiconductor Solutions 351.3 307.9 14% (1)% 13% —% —% 13% Total $ 1,786.2 $ 1,561.4 14% (1)% 14% (4)% —% 10% Specialties: Industrial Solutions $ 651.4 $ 666.4 (2)% 0% (2)% —% 3% 0% Graphics Solutions 24.2 146.2 (83)% 1% (82)% —% 84% 1% Energy Solutions 89.4 82.9 8% (1)% 7% —% —% 7% Total $ 765.0 $ 895.5 (15)% 0% (15)% —% 16% 1% Total $ 2,551.2 $ 2,456.9 4% 0% 3% (3)% 6% 6% NOTE: Totals may not sum due to rounding.
The reacquired ViaForm Distribution Rights and the Kuprion Acquisition had a positive impact of 3% on reported net sales. Foreign exchange had a negative impact of 1% on reported net sales. The increase in organic net sales was primarily due to increased demand for wafer level packaging products in Asia and growth from new customers in power electronics.
Foreign exchange had a positive impact of 1% on reported net sales. The increase in organic net sales was primarily due to increased demand in Asia for wafer plating and advanced packaging material solutions, as well as growth in power electronics from new EV customers.
The valuation allowances were released as the Company expects improved profitability in its U.K. business and a shift to a three-year cumulative income position. The Company determined there was sufficient positive, objectively verifiable evidence to conclude that it is more likely than not that, as of December 31, 2024, select U.K. net deferred tax assets will be realized.
The Company determined there was sufficient positive, objectively verifiable evidence to conclude that it is more likely than not that, as of December 31, 2024, select U.K. net deferred tax assets will be realized.
For additional information see Note 11, Income Taxes , to the Consolidated Financial Statements included in this 2024 Annual Report. 34 Segment Adjusted EBITDA Performance Year Ended December 31, Change (dollars in millions) 2024 2023 Reported Constant Currency Net income: Total $ 244.5 $ 118.2 107% Adjusted EBITDA: Electronics $ 361.5 $ 317.7 14% 16% Industrial & Specialty 173.2 164.6 5% 8% Total $ 534.7 $ 482.3 11% 13% Net income margin: Total 10.0 % 5.1 % 490 bps Adjusted EBITDA margin: Electronics 23.1 % 22.5 % 60 bps 80 bps Industrial & Specialty 19.3 % 17.9 % 140 bps 160 bps Total 21.8 % 20.7 % 110 bps 120 bps Electronics' Adjusted EBITDA for 2024 increased 14% on a reported basis and 16% on a constant currency basis.
For additional information see Note 11, Income Taxes , to the Consolidated Financial Statements included in this 2025 Annual Report. 34 Segment Adjusted EBITDA Performance Year Ended December 31, Change (dollars in millions) 2025 2024 Reported Constant Currency Net income: Total $ 191.0 $ 244.5 (22)% Adjusted EBITDA: Electronics $ 382.2 $ 361.5 6% 5% Specialties 165.4 173.2 (5)% (4)% Total $ 547.6 $ 534.7 2% 2% Net income margin: Total 7.5 % 10.0 % (250) bps Adjusted EBITDA margin: Electronics 21.4 % 23.1 % (170) bps (180) bps Specialties 21.6 % 19.3 % 230 bps 250 bps Total 21.5 % 21.8 % (30) bps (30) bps Electronics' Adjusted EBITDA for 2025 increased 6% on a reported basis and 5% on a constant currency basis.
Our tax expense for 2024 was lower than the U.S. statutory tax rate primarily driven by a continued U.S. benefit related to claiming foreign tax credits consistent with our election in the fourth quarter of 2023, release of valuation allowances and deductions for FDII, with offsets from withholding taxes, tax attribute expirations and the impact of changes to the geographical mix of earnings. 33 The rate for 2024 includes a benefit associated with the release of valuation allowances of $40.8 million previously recorded against certain U.K. tax attribute carryforwards, primarily consisting of net operating loss carryforwards and interest carryforwards.
The income tax expense of $44.8 million for the year ended December 31, 2024, is below the statutory U.S. rate primarily driven by a continued U.S. benefit related to claiming foreign tax credits consistent with our election in the fourth quarter of 2023 and the release of valuation allowances and deductions for FDII, with offsets from withholding taxes, tax attribute expirations and the impact of changes to the geographical mix of earnings.
The increase in the funding position was primarily driven by $11.0 million of actuarial gains due to changes in plan assumptions and experience and a $7.1 million return on plan assets partially offset by $8.4 million of interest costs. The Foreign Pension Plans were underfunded by $12.9 million at December 31, 2024 compared to $14.8 million at December 31, 2023.
The increase in the funding position in 2025 was primarily driven by $1.3 million of actuarial loss due to changes in plan assumptions and experience and a $12.0 million return on plan assets partially offset by $8.7 million of interest costs.
We are not required to make any material plan contributions in 2025. While we do not currently anticipate any, additional future material contributions may be required in order to maintain appropriate funding levels within our plans.
The Foreign Pension Plans were underfunded by $13.4 million at December 31, 2025 compared to $12.9 million at December 31, 2024. We are not required to make any material plan contributions in 2026. While we do not currently anticipate any, additional future material contributions may be required in order to maintain appropriate funding levels within our plans.
Foreign exchange had a negative impact of 1% on reported net sales. The increase in organic net sales was primarily due to increased demand in the AI and data center end markets, electric vehicles in China and the mobile phone end market. • Semiconductor Solutions : net sales increased 17% on a reported basis and 14% on an organic basis.
Foreign exchange had a positive impact of 2% on reported net sales. The increase in organic net sales was primarily due to continued AI and data center investment driving demand for metallization solutions. • Semiconductor Solutions : net sales increased 14% on a reported basis and 13% on an organic basis.
Its products include chemical systems that protect and decorate metal and plastic surfaces; consumable chemicals that enable printing image transfer on flexible packaging materials; and chemistries used in water-based hydraulic control fluids in offshore energy production. These fully consumable products are used in the aerospace, automotive, construction, consumer electronics, consumer packaged goods and oil and gas production end-markets.
Its products include chemical systems that protect and decorate metal and plastic surfaces and chemistries used in water-based hydraulic control fluids for offshore energy production. The segment's products are used in the aerospace, automotive, construction, consumer electronics and oil and gas production end-markets. The segment provides solutions through the following businesses: Industrial Solutions and Energy Solutions.
Gross Profit Year Ended December 31, Change (dollars in millions) 2024 2023 Reported Constant Currency Gross profit: Electronics $ 652.5 $ 558.2 17% 18% Industrial & Specialty 383.2 360.3 6% 8% Total $ 1,035.7 $ 918.5 13% 14% Gross profit margin: Electronics 41.8 % 39.5 % 230 bps 220 bps Industrial & Specialty 42.8 % 39.2 % 360 bps 360 bps Total 42.2 % 39.4 % 280 bps 270 bps Electronics' gross profit for 2024 increased 17% on a reported basis and 18% on a constant currency basis.
Gross Profit Year Ended December 31, Change (dollars in millions) 2025 2024 Reported Constant Currency Gross profit: Electronics $ 715.6 $ 652.5 10% 9% Specialties 354.9 383.2 (7)% (7)% Total $ 1,070.5 $ 1,035.7 3% 3% Gross profit margin: Electronics 40.1 % 41.8 % (170) bps (160) bps Specialties 46.4 % 42.8 % 360 bps 380 bps Total 42.0 % 42.2 % (20) bps (10) bps Electronics' gross profit for 2025 increased 10% on a reported basis and 9% on a constant currency basis.
Financing Activities In October 2024, we received proceeds of approximately $1.04 billion from the syndication of our new term loans B-3 which were used to prepay our then outstanding $1.14 billion term loans B-2 reducing gross debt by $100 million.
In addition, we paid $19.4 million for shares of our common stock withheld by the Company to satisfy the tax withholding requirements related to the vesting of RSUs, partially offset by proceeds of $4.2 million received for stock options exercised, included in "Other, net." In October 2024, we received proceeds of approximately $1.04 billion from the syndication of our new term loans B-3 which were used to prepay our then outstanding $1.14 billion term loans B-2 reducing gross debt by $100 million.
The following is a summary of our cash flows provided by (used in) operating, investing and financing activities during the periods indicated: Year Ended December 31, (dollars in millions) 2024 2023 2022 Cash provided by operating activities $ 362.0 $ 333.6 $ 295.9 Cash used in investing activities $ (73.8) $ (250.2) $ (75.2) Cash used in financing activities $ (206.6) $ (58.7) $ (275.6) Year Ended December 31, 2024 compared to Year Ended December 31, 2023 Operating Activities The increase in net cash flows provided by operating activities of $28.4 million was primarily driven by higher cash operating profits (net income adjusted for non-cash items) partially offset by higher levels of working capital.
The following is a summary of our cash flows provided by (used in) operating, investing and financing activities during the periods indicated: Year Ended December 31, (dollars in millions) 2025 2024 2023 Cash provided by operating activities $ 289.8 $ 362.0 $ 333.6 Cash provided by (used in) investing activities $ 286.1 $ (73.8) $ (250.2) Cash used in financing activities $ (320.4) $ (206.6) $ (58.7) Year Ended December 31, 2025 compared to Year Ended December 31, 2024 Operating Activities The decrease in net cash flows provided by operating activities of $72.2 million was primarily driven by higher working capital investment, higher incentive compensation payments that were associated with 2024 performance, lower earnings as a result of the MGS Transaction and higher payments associated with transaction expenses.
The constant currency increase was primarily driven by $19.8 million of higher incentive compensation costs, primarily due to higher accruals associated with increased expectations for strong full year financial results, $12.2 million of costs related to the MGS Transaction, higher personnel costs and $3.9 million of research and development costs associated with contingent consideration for the Kuprion Acquisition in the first quarter of 2024.
The constant currency increase was primarily driven by a 2025 executive share grant for $37.1 million in the fourth quarter of 2025, higher incentive compensation costs, due to higher accruals associated with increased expectations for strong full year financial results, $6.1 million of higher research and development costs associated with our Kuprion ActiveCopper applications and $4.0 million of non-recurring costs associated with the MGS Transaction in 2025; partially offset by $22.7 million of lower operating expenses due to the sale of MacDermid Graphics Solutions and $3.9 million of research and development costs associated with contingent consideration for the Kuprion Acquisition incurred in the first quarter of 2024.
Both periods included an equipment sale for a new production line under a multi-year chemistry sales agreement with an automotive customer. 31 • Graphics Solutions : net sales increased 2% on a reported basis and 3% on an organic basis. Foreign exchange had a negative impact of 1% on reported net sales.
Foreign exchange had an immaterial impact on reported net sales. An equipment sale in the third quarter of 2024 for a new production line under a multi-year chemistry sales agreement resulted in a negative impact of approximately 1% to organic net sales.
Liquidity and Capital Resources Our primary sources of liquidity during 2024 were the proceeds from the syndication of our new term loans B-3 of approximately $1.04 billion as well as available cash generated from operations.
Liquidity and Capital Resources Our primary sources of liquidity during 2025 were the proceeds from the MGS Transaction and available cash generated from operations.
Foreign exchange had a negative impact of 2% on reported net sales. The increase in organic net sales was primarily due to demand improvement in consumer, mobile and computer end markets, offset by weakness in broader industrial and automotive end markets. • Circuitry Solutions : net sales increased 11% on a reported basis and 12% on an organic basis.
Foreign exchange had an immaterial impact on reported net sales. The increase in organic net sales was primarily due to higher paste and flux volumes from increased consumer electronics demand in Asia and the Americas. • Circuitry Solutions : net sales increased 12% on a reported basis and 10% on an organic basis.
Operating Expenses Year ended December 31, Change (dollars in millions) 2024 2023 Reported Constant Currency Selling, technical, general and administrative $ 628.8 $ 596.8 5% 6% Research and development 63.0 68.1 (8)% (7)% Goodwill impairment — 80.0 (nm) (nm) Total $ 691.8 $ 744.9 (7)% (6)% Operating expenses as % of net sales Selling, technical, general and administrative 25.6 % 25.6 % 0 bps (20) bps Research and development 2.6 % 2.9 % (30) bps (40) bps Goodwill impairment — % 3.4 % (nm) (nm) Total 28.2 % 31.9 % (370) bps (400) bps (nm) Calculation not meaningful. 32 During the third quarter of 2023, we recorded an impairment charge in our Industrial & Specialty segment of $80.0 million related to our Graphics Solutions reporting unit.
Operating Expenses Year ended December 31, Change (dollars in millions) 2025 2024 Reported Constant Currency Selling, technical, general and administrative $ 660.7 $ 628.8 5% 4% Research and development 67.6 63.0 7% 7% Total $ 728.3 $ 691.8 5% 5% Operating expenses as % of net sales Selling, technical, general and administrative 25.9 % 25.6 % 30 bps 20 bps Research and development 2.6 % 2.6 % 0 bps 10 bps Total 28.5 % 28.2 % 30 bps 30 bps Operating expenses for 2025 increased 5% on a reported basis and 5% on a constant currency basis.
Electronics' consolidated results were positively impacted by $59.7 million of pass-through metals pricing and $8.1 million of acquisitions and Industrial & Specialty's consolidated results were positively impacted by $0.5 million of acquisitions.
Electronics' consolidated results were positively impacted by $64.4 million of pass-through metals pricing and Specialties' consolidated results were negatively impacted by $139 million of divestitures.
The net proceeds of the new term loans and cash on hand were used to prepay in full our term loans B-2. • Cash Dividends - During the year ended December 31, 2024, approximately $78.2 million was returned to our stockholders in the form of cash dividends. 26 Acquisitions We may pursue targeted and opportunistic acquisitions in our existing or adjacent end-markets that seek to strengthen our current businesses, expand and diversify our product offerings, and enhance our growth and strategic position.
The remaining authorization under our stock repurchase program was approximately $556 million at December 31, 2025. Acquisitions We regularly pursue targeted and opportunistic acquisitions in our existing or adjacent end-markets that seek to strengthen our current businesses, expand and diversify our product offerings, and enhance our growth and strategic position.
The constant currency increase was primarily driven by higher gross profits related to lower raw material costs and growth in our higher margin Energy Solutions business. See Note 22, Segment Information , to the Consolidated Financial Statements for the reconciliation of "Net income" to Adjusted EBITDA.
See Note 22, Segment Information , to the Consolidated Financial Statements for the reconciliation of "Net income" to Adjusted EBITDA.
Other (Expense) Income, net Year Ended December 31, (dollars in millions) 2024 2023 Interest expense, net $ (56.3) $ (49.3) Foreign exchange gains 25.1 7.9 Other expense, net (25.0) (3.1) Total $ (56.2) $ (44.5) Interest expense, net Interest expense, net increased $7.0 million primarily due to a higher effective interest rate on our term loans B-2 (which were outstanding from December 18, 2023 through October 15, 2024 when the term loans B-2 were fully prepaid) when considering the impact of our interest rate swaps and cross currency swaps, partially offset by higher interest income.
See Note 4, Acquisitions, to the Consolidated Financial Statements for further information regarding the Kuprion Acquisition research and development costs. 32 Other (Expense) Income, net Year Ended December 31, (dollars in millions) 2025 2024 Interest expense, net $ (53.4) $ (56.3) Foreign exchange (losses) gains (35.3) 25.1 Other expense, net (46.9) (25.0) Gain on divestitures 59.0 — Total $ (76.6) $ (56.2) Interest expense, net Interest expense, net decreased $2.9 million primarily due to higher interest income partially offset by a higher effective interest rate on our lower outstanding term loan principal balance when compared to the prior year.
Our primary uses of cash and cash equivalents were to prepay approximately $1.14 billion of debt outstanding, pay cash dividends and fund operations including working capital and capital expenditures. Our first significant debt principal payment of approximately $800 million is related to the maturity of our 3.875% USD Notes due 2028.
Our first significant debt principal payment of approximately $800 million is related to the maturity of our 3.875% USD Notes due 2028. In the fourth quarter of 2025, we paid a cash dividend of 8 cents per share.
The increase in organic net sales was primarily due to increased demand for flexographic plates and new business in Latin America partially offset by lower newspaper net sales. • Energy Solutions : net sales increased 8% on a reported basis and 8% on an organic basis. Foreign exchange had an immaterial impact on reported net sales.
Foreign exchange had a positive impact of 1% on reported net sales. The increase in organic net sales was primarily due to an increase in production volumes from competitive wins and ongoing pricing actions.
The prior year was negatively impacted by lower ViaForm sales as we transitioned from our prior distributor. Industrial & Specialty's net sales for 2024 decreased 3% on a reported basis, 1% on a constant currency basis and 1% on an organic basis. • Industrial Solutions : net sales decreased 5% on a reported basis and 2% on an organic basis.
Specialties' net sales for 2025 decreased 15% on a reported basis and 15% on a constant currency basis and increased 1% on an organic basis. • Industrial Solutions : net sales decreased 2% on a reported basis and remained relatively flat on an organic basis. Divestitures had a negative impact of 3% on reported net sales.
Removed
In 2024, we achieved net sales of $2.46 billion, to which our Electronics and Industrial & Specialty segments contributed approximately 64% and 36%, respectively.
Added
On February 28, 2025, we completed the sale of our flexographic printing plate business, MacDermid Graphics Solutions. 2025 Highlights • Portfolio Optimization - On February 28, 2025, we completed the sale of our flexographic printing plate business, MacDermid Graphics Solutions, for approximately $320 million, net of disposed cash. MacDermid Graphics Solutions was reported within the Specialties segment.
Removed
The segment provides specialty chemical solutions through the following businesses: Industrial Solutions, Graphics Solutions and Energy Solutions. 2024 Corporate Activity • Portfolio Optimization - On September 1, 2024, we agreed to sell our flexographic printing plate business, MacDermid Graphics Solutions, for approximately $325 million.
Added
The sale resulted in a gain of $66.5 million. • EFC Acquisition - On January 2, 2026, we completed the acquisition of EFC Gases & Advanced Materials, a provider of high-purity specialty gases and other advanced materials, for a purchase price of approximately $369 million, net of cash and subject to adjustments, with a potential earn-out based on EFC's 2026 performance of up to $30.0 million cash or 1.16 million Company shares. • Micromax Acquisition - On February 2, 2026, we completed the acquisition of Micromax, a global supplier of advanced electronics inks and pastes, for a purchase price of approximately $500 million, net of cash and subject to adjustments. 26 • Add-on Term Loans & Revolver Upsize - On February 2, 2026, we completed the syndication of $450 million of Add-on Term Loans and a 5-year $500 million senior secured revolving credit facility, which replaced our then existing $375 million revolving facility, upsizing the facility by $125 million and extending its maturity to 2031.
Removed
MacDermid Graphics Solutions constitutes substantially all of our Graphics Solutions business within our Industrial & Specialty segment.
Added
The proceeds of the Add-on Term Loans were used to fund a portion of the purchase price of the Micromax Acquisition. • Cash Dividends - During the year ended December 31, 2025, approximately $77.8 million was returned to our stockholders in the form of cash dividends. • Repurchases of Common Stock - During the year ended December 31, 2025, we repurchased 1.2 million shares of our common stock for $25.0 million.
Removed
The transaction is expected to close in the first quarter of 2025, subject to customary closing conditions and adjustments. • Improved Balance Sheet through Debt and Interest Rate Reduction - In October 2024, we completed the syndication of $1.04 billion of new term loans B-3 which resulted in an interest rate reduction of 25 basis points to SOFR plus a spread 1.75% per annum.
Added
In addition, organic net sales were impacted by volume declines in Europe from lower activity in automotive, construction and general industrial markets, offset by increased net sales of engineering applications primarily in the United Kingdom and increased demand in the automotive end market in Asia. 31 • Graphics Solutions : on February 28, 2025, the Company completed the sale of its flexographic printing plate business, MacDermid Graphics Solutions. • Energy Solutions : net sales increased 8% on a reported basis and 7% on an organic basis.
Removed
In connection with this repricing, we fully paid down our $1.14 billion term loans B-2, therefore reducing our borrowings under the Credit Agreement by $100 million.
Added
The constant currency increase in gross profit was primarily driven by broad-based organic volume growth across all three Electronics businesses. The decrease in gross margin was primarily due to the negative impact of higher prices for pass-through tin and silver. Specialties' gross profit for 2025 decreased 7% on a reported basis and 7% on a constant currency basis.
Removed
Acquisitions had an immaterial impact on reported net sales. Foreign exchange had a negative impact of 2% on reported net sales. The decrease in organic net sales was primarily due to continued lower demand in the automotive end market, lower commodity surcharges in 2024 when compared to 2023 as well as demand softness in construction and industrial end markets.
Added
The MGS Transaction had a negative impact of $43.1 million, or 11%, on constant currency gross profit, which was the primary driver of the decrease. The increase in gross margin was primarily due to the sale of the lower margin Graphics Solutions business and continued price discipline and raw material deflation in the Industrial Solutions business.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

8 edited+0 added−0 removed9 unchanged
Biggest changeAt December 31, 2024, the aggregate U.S. dollar notional amount of metals futures contracts, none of which were designated as hedges for accounting purposes, totaled $55.3 million. The fair value of the metals forward contracts at December 31, 2024 was a $3.2 million net current asset and net realized and unrealized losses on such contracts for 2024 totaled $11.0 million.
Biggest changeAt December 31, 2025, the aggregate U.S. dollar notional amount of metals futures contracts, none of which were designated as hedges for accounting purposes, totaled $91.4 million. The fair value of the metals forward contracts at December 31, 2025 was a $13.5 million net current liability and net realized and unrealized losses on such contracts for 2025 totaled $47.2 million.
Generally, our foreign subsidiaries use their local currency as their functional currency; the currency in which they incur operating expenses and collect accounts receivable. Our business is exposed to foreign currency risk from changes in the exchange rate primarily between the U.S. dollar and the following currencies: euro and Chinese yuan.
Generally, our foreign subsidiaries use their local currency as their functional currency; the currency in which they incur operating expenses and collect accounts receivable. Our business is exposed to foreign currency risk from changes in the exchange rate primarily between the U.S. dollar and the following currencies: Chinese yuan and euro.
Item 8. Financial Statements and Supplementary Data See “Index to Consolidated Financial Statements” in this 2024 Annual Report. 38 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None.
Item 8. Financial Statements and Supplementary Data See “Index to Consolidated Financial Statements” in this 2025 Annual Report. 38 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None.
The net result of these hedges was an interest rate of approximately 3.0% at December 31, 2024 on the term loans B-3, which could vary in the future due to changes in the euro and the U.S. dollar exchange rate. See Note 13, Financial Instruments , to the Consolidated Financial Statements included in this 2024 Annual Report for additional information.
The net result of these hedges was an interest rate of approximately 4.5% at December 31, 2025 on the term loans B-3, which could vary in the future due to changes in the euro and the U.S. dollar exchange rate. See Note 13, Financial Instruments , to the Consolidated Financial Statements included in this 2025 Annual Report for additional information.
At December 31, 2024, we believe that our exposure to counterparty risk was immaterial. Foreign Currency Risk We conduct a significant portion of our business in currencies other than the U.S. dollar, our financial reporting currency. In 2024, approximately 77% of our net sales were generated outside of the U.S.
At December 31, 2025, we believe that our exposure to counterparty risk was immaterial. Foreign Currency Risk We conduct a significant portion of our business in currencies other than the U.S. dollar, our financial reporting currency. In 2025, approximately 79% of our net sales were generated outside of the U.S.
At December 31, 2024, the aggregate U.S. dollar notional amount of foreign currency forward contracts totaled $104 million. None of these foreign currency forward contracts were designated as hedges for accounting purposes.
At December 31, 2025, the aggregate U.S. dollar notional amount of foreign currency forward contracts totaled $133 million. None of these foreign currency forward contracts were designated as hedges for accounting purposes.
At December 31, 2024, we had total debt of $1.82 billion, net of unamortized discounts and debt issuance costs of $14.8 million, including approximately $1.04 billion of variable interest rate debt based on the one-month Secured Overnight Financing Rate (SOFR). 37 We use interest rate swaps and cross-currency swaps designed to reduce our exposure to interest rate risk and foreign currency risk.
At December 31, 2025, we had total debt of $1.63 billion, net of unamortized discounts and debt issuance costs of $10.3 million, including approximately $836 million of variable interest rate debt based on the one-month Secured Overnight Financing Rate (SOFR). 37 We use interest rate swaps and cross-currency swaps designed to reduce our exposure to interest rate risk and foreign currency risk.
Their fair value at December 31, 2024 was a $0.9 million net current asset, and the net realized and unrealized losses on such contracts for 2024 totaled $4.1 million.
Their fair value at December 31, 2025 was a $0.9 million net current liability, and the net realized and unrealized losses on such contracts for 2025 totaled an immaterial amount.

Other ESI 10-K year-over-year comparisons