Ampco-Pittsburgh Corporation Q2 FY2025 earnings call

• CEO mentioned adjusted EBITDA of $8 million for Q2 2025 was negatively impacted by customer orders pause awaiting tariff clarity, Forged and Cast Engineered Products shut down production to adjust working capital; U.K. cash roll facility had significant losses, wind down progress good, expected at least $5 million annualized operating income improvement once complete. - Air & Liquid Processing segment saw 15% adjusted EBITDA increase vs prior year, year-to-date adjusted EBITDA at highest in history. - Sam Lyon noted FCEP net sales details, plant utilization issues, FEP demand and shipments positive, pricing and product mix improvements, pump and heat exchanger performance. - Dave Anderson stated Air & Liquid Systems order activity good, backlog up 8%, year-to-date adjusted EBITDA up 36%, strong demand in nuclear, military, pharmaceutical markets, copper tariff impact to pass on to customers.

For the Forged and Cast Engineered Products (FCEP) segment: In the second quarter of 2025, FCEP reported net sales of $77.9 million, a 3% increase compared to Q2 2024 and a 7.8% increase compared to Q1 2025. Segment adjusted EBITDA for Q2 2025 was $6.8 million, down $1.5 million from Q1 2025. The U.S. Forged plant utilization was lower due to lower work roll demand. However, FEP demand and shipments were positive, pricing on FEP product line was increased, and product mix was improved. Revenue for pumps was higher due to military market results, but heat exchanger shipments declined. For the Air & Liquid Systems segment: Adjusted EBITDA in the quarter was up 15% versus prior year, and year-to-date adjusted EBITDA of $7.7 million was the highest in the segment's history, a 36% increase over prior year. Order activity was good with backlog 8% higher than start of the year, strong demand in nuclear, military, and pharmaceutical markets.

• Completion of U.K. facility wind down expected to bring at least $5 million annualized operating income improvement. - 2025 year-to-date adjusted EBITDA $16.8 million remains up vs prior year. - Amended and extended credit agreement through 2030, providing greater flexibility to support global working capital needs, increased liquidity with fully drawing on term loan at closing.

• Tariffs caused customer orders pause, impacting Forged and Cast Engineered Products production. - U.K. cash roll facility continues to experience significant losses. - Copper tariff will impact products, as copper is main component of heat exchangers.

Q: Hoping to get more color on what's going on in the roll market.

A: Second half of the year will be lighter shipment on rolls than first half. Saw slight uptick in order activity from some large customers. Tariffs are known now, expected things to start happening again. The lack of demand was due to tariff uncertainty and other factors, now settled expect things to go back to normal.

Q: How is closing the U.K. operations going to impact revenues?

A: Roughly will be down $25 million to $29 million, but some upside from converting some rolls to forged rolls ($3 million to $4 million), so in neighborhood of $20 million to $25 million, with offset from shifting product to Sweden where utilization is lower now