OLN Q2 Earnings In Line, Revenues Beat on Epoxy, Winchester Gains

Revenues declined 0.9% year over year to $1,741.9 million but beat the consensus estimate of $1,719.6 million by 1.3%. Adjusted EBITDA rose 8.6% to $191.3 million, supported by improved chemical pricing and stronger Epoxy and Winchester performance.

Segmental Review

Chlor Alkali Products and Vinyls sales were $819.5 million in the second quarter, down 16.3% year over year from $979.5 million. The reported figure missed the consensus estimate of $885 million. The decline primarily resulted from lower trading volumes associated with Blue Water Alliance and reduced vinyl chloride monomer volumes. The Blue Water Alliance joint venture concluded operations at the end of 2025. Segment earnings declined to $53.4 million from $64.9 million, with operating issues at the Freeport, TX, vinyl chloride monomer plant hurting results by $40.1 million.

Epoxy sales increased 27.4% year over year to $422.1 million from $331.2 million, driven by higher volumes and improved pricing. The metric beat the consensus estimate of $376 million.  Segment earnings improved to $16 million from a year-ago loss of $23.7 million, reflecting higher volumes, improved product margins and lower operating costs. Higher selling prices supported margins, partly offset by elevated benzene and propylene costs.

Winchester sales rose 11.8% year over year to $500.3 million from $447.6 million. It outpaced the consensus estimate of $494 million. Growth was mainly driven by higher commercial ammunition sales and increased military project revenues. Segment earnings increased to $28.1 million from $25 million as higher commercial ammunition pricing and volumes and military project revenues more than offset higher commodity metal and operating costs.

Financials

Olin ended the second quarter with cash and cash equivalents of $177.4 million. Net debt was $2.85 billion. Net cash used in operating activities was $40.7 million during the first six months of 2026. Dividends paid totaled $45.6 million for the period. No common stock repurchases and retirements were recorded in the first half of 2026.

Outlook

For the third quarter of 2026, Olin expects adjusted EBITDA in the range of $160 million to $200 million. The company expects its Chemical businesses’ results to be comparable with second-quarter levels as lower operating rates at the Freeport vinyl chloride monomer facility and weaker ethylene dichloride pricing offset anticipated stronger caustic soda volumes.

The Freeport disruption is expected to reduce third-quarter adjusted EBITDA by roughly $20 million, with full operating rates planned to resume late in the quarter. In Winchester, seasonally improving commercial demand is expected to support sequential earnings growth. Beyond 2026, the company expects the proposed Huntsman merger to close in the first half of 2027, subject to the required approvals and closing conditions.

Olin’s Price Performance

Shares of Olin have lost 1% in the past year against 6.1% rise of the industry.

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OLN’s Zacks Rank & Key Picks

OLN currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks are Neo Performance Materials Inc. NOPMF, CECO Environmental Corp. CECO and Applied Industrial Technologies, Inc. AIT

Neo Performance is slated to report second-quarter 2026 results on Aug. 11. The Zacks Consensus Estimate for earnings is pegged at 50 cents per share. NOPMF sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here. 

CECO is slated to report second-quarter 2026 results on Aug. 10. The consensus estimate for CECO’s earnings per share is pegged at 24 cents. CECO presently sports a Zacks Rank #1.

Applied Industrial is scheduled to report fourth-quarter fiscal 2026 results on Aug. 13. The Zacks Consensus Estimate for AIT’s fourth-quarter earnings per share is pegged at $2.92. AIT carries a Zacks Rank #2 (Buy) at present.

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