EAF

• Strategic Commercial Progress
  • Delivered 8% year-over-year Q2 sales volume growth, with 29% growth in the U.S. market
  • Implemented price increases on uncommitted graphite electrode volume; new customer commitments average more than 15% above pre-announcement pricing, though impact will be phased as shipments occur over time
  • Over 90% of 2026 anticipated volume is already committed in the order book, mostly at pricing reflecting end-Q4 2025 market levels
• Trade Policy Advocacy
  • Supports active graphite electrode trade cases in key jurisdictions, including the U.S. case against unfairly priced imports from China and India
  • The U.S. ITC issued a preliminary ruling of material injury to the domestic industry, and the Department of Commerce is scheduled to issue preliminary countervailing duty determinations the week after the call, with anti-dumping determinations expected by end of September 2026
• Operational Improvements
  • Q2 production volume exceeded 33,000 metric tons, bringing quarterly capacity utilization to 74% (the highest level since 2022)
  • Year-to-date production has outpaced sales by 4,000 metric tons as part of a planned inventory build ahead of scheduled summer European plant maintenance
  • Achieved continued manufacturing cost structure improvements, with cash COGS per metric ton down 9% sequentially
  • Improved year-to-date total recordable incident rate for workplace safety by 0.35, continuing multi-year improvement trends
• End Market Outlook
  • Global steel production (ex-China) rose ~2% year-over-year in Q2; U.S. steel production is up 6% year-to-date, with U.S. steel capacity utilization hitting 80% (first time since Q2 2022)
  • European steel market conditions remain challenging, but new EU policies including the Carbon Border Adjustment Mechanism and stricter steel import trade protections are expected to boost domestic EU steel capacity utilization over time to 75% or higher from the current ~60%
  • The long-term steel demand outlook is constructive, supported by infrastructure investment, increased defense spending, easing monetary policy, and expanded trade protections globally
• Emerging Growth and Strategic Opportunities
  • Positioning to capitalize on growing demand for synthetic graphite driven by electric arc furnace steel growth and energy storage applications
  • Leveraging vertical integration in needle coke production to deliver supply reliability for customers and benefit from improving needle coke market fundamentals
  • Engaging with policymakers in the U.S. and EU to shape critical mineral supply chain policies that support resilient domestic graphite electrode production, and exploring opportunities to leverage existing graphitization capacity for battery materials partnerships

• Full-year 2026 guidance for sales volume and full-year cash COGS per metric ton is reaffirmed, with management expecting a low single-digit year-over-year reduction in cash COGS per metric ton
• Q2 2026 is expected to be the highest cash usage quarter of 2026, consistent with seasonal working capital patterns
• Full-year 2026 capital expenditure guidance is maintained at approximately $35 million, focused on asset maintenance and targeted productivity improvements
• A modest full-year 2026 increase in working capital is expected, to support higher planned sales volume
• Management expects higher new order pricing to begin contributing meaningfully to financial performance starting in 2027, and notes that higher recent pricing commitments create a stronger starting point for 2027 contract negotiations

GrafTech operates as a single integrated graphite electrode and petroleum needle coke business, so no separate product segment financials are broken out. For Q2 2026, overall net sales were $127 million, a 3% year-over-year decrease. Sales volume hit 31,000 metric tons, an 8% year-over-year increase and a 10% sequential increase from Q1 2026. 29% of Q2 2026 sales volume growth came from the U.S. region, the company's strongest commercial region. Adjusted EBITDA was $2 million, compared to $3 million in the year-ago quarter. Cash costs of goods sold per metric ton declined approximately 9% sequentially quarter-over-quarter. Net cash used in operating activities was $69 million, and adjusted free cash flow was negative $75 million, compared to negative $53 million in Q2 2025. Total liquidity at quarter-end was $253 million, consisting of $145 million in cash and $108 million in available revolving credit capacity. Total capital expenditure guidance for full-year 2026 remains $35 million.

• Current graphite electrode industry pricing remains under pressure, and broader industry oversupply persists, which could delay pricing recovery
• The Middle East conflict has driven upward pressure on oil-related feedstock costs and created decant oil supply tightness for non-integrated needle coke producers, which could create broader input cost inflation for the industry
• Geopolitical conflicts continue to create cost headwinds for raw materials and energy
• The timing of a broader industry and pricing recovery is uncertain and dependent on macroeconomic conditions outside of management control
• Pricing improvements for 2026 will be modest due to the large share of pre-price-increase committed volume in the 2026 order book
• Input cost increases beyond current expectations will require additional future price increases to offset inflationary impacts

Q: U.S. sales volume grew 29% year-over-year; is this from customers pulling forward shipments, and will U.S. strength continue through the end of 2026?

A: Some volume did pull into Q2 from later quarters, which signals strengthening demand. Management also sees strong new incoming orders for the second half of 2026, and expects U.S. market strength to persist for the remainder of the year.

Q: Do you see needle coke price increases matching the $200-$300 per ton increase reported by peers, and how is decant oil pricing moving after Middle East tensions escalated?

A: GrafTech confirms it sees the same $200-$300 per ton market price increase for third-party needle coke. The company's vertical integration with its own Fort Lavaca needle coke plant insulates it from these pricing pressures. Supply tightness driven by Middle East feedstock disruptions is expected to continue supporting higher needle coke prices through the second half of 2026. GrafTech sources all its decant oil from U.S. refineries, so it is less impacted by global supply disruptions than competitors, and maintains full-year cost guidance.

Q: Your capacity utilization is 74% while U.S. steel utilization is 80%; will these converge, does the industry need capacity rationalization, and would GrafTech cut output to balance supply?

A: GrafTech's 74% utilization reflects a planned inventory build ahead of scheduled summer European maintenance, not a market imbalance. Management states as industry leader, it will adjust production levels and align supply with sustainable industry economics if market conditions require output cuts, and remains open to capacity rationalization to support balanced market conditions.

Q: What percentage of the U.S. graphite electrode market will be impacted by the upcoming U.S. anti-dumping duties, and what is the expected impact?

A: Approximately 15-20% of current U.S. graphite electrode volume is imported from China and India. Management expects the duties will make imported volume uneconomical, creating domestic volume opportunity for GrafTech, and will also establish a meaningful price floor to support stronger domestic pricing for the whole industry.