Thank you for standing by. My name is Kate, and I will be your conference operator today. At this time, I would like to welcome everyone to the H.B. Fuller Company Q1 2026 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. Thank you. I would now like to turn the call over to Scott Jensen, Investor Relations. Please go ahead.

Thank you, operator. Welcome to H.B. Fuller Company's first quarter 2026 Investor Conference Call. Presenting today are Celeste Mastin, President and Chief Executive Officer, and John Corkrean, Executive Vice President and Chief Financial Officer. After our prepared remarks, we will have a question and answer session. Before we begin, let me remind everyone that our comments today will include references to certain non-GAAP financial measures. These measures are supplemental to the results determined in accordance with GAAP. We believe that these measures are useful to investors in understanding our operational performance and to compare our performance with other companies. Reconciliations of non-GAAP measures to the nearest GAAP measure are included in our earnings release. Unless otherwise noted, comments about revenue refer to organic revenue, and comments about EPS, EBITDA, and profit margins refer to adjusted non-GAAP measures. We will also be making forward-looking statements during this call. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially from these expectations due to factors covered in our earnings release, comments made during this call, and the risk factors detailed in our filings with the SEC, all of which are available on our website at investors.hbfuller.com. I will now turn the call over to Celeste Mastin. Celeste?

Thank you, Scott, and welcome to today's call. In the first quarter, we delivered on our profit commitment and executed with discipline in a challenging operating environment. We continued to expand margins by leveraging our global sourcing strengths and maintaining a focused approach to cost and portfolio management. To start today's call, we will cover our consolidated results in the first quarter. We will also spend significant time discussing the impact on supply chains resulting from the recent events in the Middle East and the actions we are taking to successfully navigate this new operating environment. In the first quarter, organic revenue decreased 6.6% year on year as positive pricing was offset by lower volume. From a profitability perspective, EBITDA of $119,000,000, which was at the higher end of our guidance range, increased 4% year on year, and EBITDA margin expanded 90 basis points to 15.4%. This was primarily driven by continued restructuring savings from Quantum Leap and the positive impact from price and raw material cost actions that more than offset the impact from lower volumes. Now let me move on to review the performance in each of our segments in the first quarter. EA organic revenue increased approximately 3% in the first quarter, excluding the impact of exiting the lower margin solar business, driven by continued strength in electronics and aerospace. Organic revenue declined 2% in the first quarter, including solar. EBITDA increased 9% in EA, and EBITDA margin increased 120 basis points year on year to 19.9%. Favorable net pricing and raw material cost actions and the benefit from restructuring drove the year on year margin expansion. In HHC, organic revenue declined 10% year over year, reflecting a challenging environment and a tough comparison to 2025 when the business delivered 4% organic growth. We saw customers maintain…

Thank you, Celeste. I will begin with some additional financial details on the first quarter. For the quarter, organic revenue was down 6.6% year on year, with pricing up 0.6% and volume down 7.2%. Currency had a positive impact of 3.6%, and acquisitions increased revenue by 0.7%. Adjusted gross profit margin was 31.3%, up 170 basis points versus last year as positive pricing and raw material actions as well as restructuring savings more than offset volume declines. Adjusted selling, general, and administrative expense was up 4% year over year. Excluding the impact of acquisitions and foreign exchange, SG&A was down slightly year on year, reflecting diligent expense management. Adjusted EBITDA for the quarter was $119,000,000, up 4% versus last year, as favorable pricing and raw material actions and restructuring savings more than offset the impact of lower volume. Adjusted earnings per share of $0.57 was up 6% versus the same quarter in 2025, driven by higher operating income and lower shares outstanding. Cash flow from operations improved $49,000,000 year on year. As previously communicated, operating cash flow for 2026 is expected to be weighted to the second half of the year. Net debt to adjusted EBITDA was 3.1 times, consistent with fiscal year-end 2025 and down from 3.5 times at the end of the first quarter of last year. With that, let me now turn to our guidance for the 2026 fiscal year. As a result of our year-to-date performance and our response to the supply chain disruptions Celeste outlined earlier, we are updating our previously communicated financial guidance for fiscal 2026. Net revenue is now expected to be up mid-single digits and organic revenue is now expected to be up low single digits versus fiscal 2025, reflecting updated pricing actions and anticipated market share gains. We now expect foreign currency translation to positively impact revenue by 1% to 2%. Adjusted EBITDA for fiscal 2026 is now expected to be in the range of $645,000,000 to $675,000,000. And adjusted EPS is now expected to be in the range of $4.55 to $4.90. Net revenue for the second quarter is expected to be up low single digits and adjusted EBITDA is expected to be in the range of $175,000,000 to $185,000,000. We have updated our short-term capital allocation priorities given the current petrochemical market disruption and uncertainty. While M&A remains a cornerstone of our growth strategy and we continue to evaluate strategic acquisitions, we will pause on closing deals in the near term, focusing more cash deployment on share repurchases while we deliver on our commitment to achieve our target of 2.5 times to 3.0 times net debt to EBITDA. Let me turn the call back over to Celeste to wrap us up.

Thank you, John. Our operational focus is on controlling what we can, leveraging our global sourcing advantage, maintaining commercial discipline, and executing our strategy with consistency. The current disruption further reinforces the importance of a resilient supply chain and manufacturing network. Against this backdrop, Project Quantum Leap is progressing well and remains on track. Our redesigned plant and supply chain network will strengthen our long-term competitiveness and deliver improved profitability. We have provided context today on what we expect from the developments in the Middle East. Most importantly, our primary focus remains on our employees, our customers, and those affected by the ongoing conflict. I particularly want to thank and recognize our leaders in the region who have stepped up to ensure the continued safety and well-being of our employees. Our agility, decisiveness, and collaborative approach ensure we will continue to serve customers reliably and differentiate ourselves from our competition while generating sustainable value for shareholders. That concludes our prepared remarks for today. Operator, please open the line for questions.

At this time, I would like to remind everyone in order to ask a question, press star then the number one on your telephone keypad. Your first question comes from the line of Patrick Cunningham with Citigroup. Your line is open.

Hi. Good morning, Celeste and John. Thanks for taking my question.

Good morning, Patrick.

Good morning. I just wanted to start off on the 10% price hike and the guidance raise. I guess, given this announcement and pretty sudden raw material constraints and pricing, does your price-cost assumption still hold? Are you baking in additional benefits from price here? Just wondering how the cadence of net price translates to raising the full-year guide here.

Yeah. So, Patrick, we are baking in additional price and raw material benefit, but also negative volume benefit. But I think it is important to take that question in the broader backdrop of what is happening in the industry. So there are a couple of things going on here that I think are really important. I tried to reference them in the script. But the first thing is that as we look at the landscape that we are now in, this is a very different adhesive market environment, and one where our ability to gain share is enhanced. I say that because when you think about how we usually win business, it is by winning new applications with customers that are introducing a new product or upgrading a product, or maybe working with a customer that has a problem on their line or a performance problem in their existing adhesive. But those latter things do not happen very often. So normally, our share gains happen through the winning innovation that we bring to solutions for new products. Now what has happened today is that as it relates to the current adhesive allocation, everything has changed. We have competitors that are unable to get raw materials. We have customers that are seeking those raw materials. We are out aggressively doing everything we can to increase allocations, to go after raw material provisions with other suppliers. So that pricing comes in the context of an environment where the market is really squeezed. But on top of that, the opportunity to bring solutions to customers directly relates to share increase. On top of that, we believe this market reset is a very sustainable place for us to be. I say that because today, if you look at the overall raw material supply base,…

Understood. I mean, if it takes a little more context as it relates to how we thought about the rest of this year. Perfect. You are right. The impact of pricing, raws, and volume is driving probably two-thirds of the change we are making to our guidance. Just to put it in context, we are now expecting organic growth to be up low single digits, which is roughly sub high-single-digit pricing because we will be probably averaging roughly 10% or more pricing in for the rest of this year. But we have taken our volume assumption down. We were assuming volume would be sort of flat to down 1%. Now we are assuming it will be down 5%. But I would say the way we expect to manage pricing and raws and the expectation that we will get some market share gains, that is probably delivering maybe $10,000,000 of additional favorable EBITDA impact this year. The rest of the increase is a number of things. We are making more progress more quickly on our restructuring actions. FX is a little favorable. But hopefully, that gives you some context as to how we are thinking about the impact of pricing, raws, and volume.

No. That is very helpful. And maybe just topical with the lower volume outlook. I think HHC previous quarter, you called out some inventory in December, some tighter inventory management. Did that get worse in January and February? Did it start to trend better? I am just wondering, I think the organic growth was maybe a bit sharper decline than we expected. So any additional color on what is going on in HHC? And maybe within that?

Yeah. In the HHC business, we are seeing a lot of pressure on the consumer. So a few things are happening there. To your point, the inventory management is real. It is occurring at big customers, but also we really see it in distributors as well. And when you think about it, they are serving the smaller customers. Those smaller customers are really being impacted by tariffs and other inflationary measures. So we are seeing that inventory control for sure. The other thing we are seeing is that the consumer is switching away from what I will call more premium products, and with a premium product, you usually have more adhesive usage. There are more features and benefits on those products. So when the consumer switches down, then we are selling less adhesive for the end good that they are buying. And they are buying smaller package sizes. Again, smaller packages mean less glue, and you see all of that in the HHC space.

Thank you so much.

Your next question comes from the line of Mike Harrison with Seaport Research Partners. Your line is open.

Good morning, Mike. Good morning, Andre.

Congrats on a nice start to the year. I was hoping that you could talk a little bit. I feel like on the fourth quarter call and when you initially gave guidance, there was an expectation that the timing of Lunar New Year was going to be a headwind in Q1 and a tailwind in Q2. And so I was wondering if you can help us quantify how much that Lunar New Year timing played into the 7% year on year volume decline. And then maybe also just talk about how you have seen activity in China and other parts of Asia coming out of the Lunar New Year and curious how they responded to kind of the initial impacts of the Middle East conflict.

Yeah. So we experienced about a $15,000,000 to $20,000,000 revenue impact from Chinese New Year in Q1. You will see that that is already in our guide for Q2. So that ended up just getting pushed out into the second quarter. And as we looked at overall Asia’s performance, we had seen China bounce back to double-digit growth. If we extract that impact of Chinese New Year, we would have had another double-digit quarter in Asia in Q1. I was just there in January for a couple of weeks, so to answer your question about what I saw while I was there and in the region, I see a very motivated population base. In fact, I think the tariff impact in Q2 and Q3 of last year really caused a pause, but the country was able to quickly renew export markets for their goods, and in fact, in Q1, our HHC business did very well in Asia Pacific. It was the best performing region. And part of that was because there has been such an increase in the exportation of a lot of these hygiene products out of China. So we have focused business in China in HHC away from the lower-cost baby diapers, as I have mentioned before. But we have also, at the same time, redirected that capacity to more higher-end femcare and adult incontinence products, and that is where we saw a lot of growth in China in Q1.

Mike, I can just give, and just to maybe build on that because you had, I think, asked kind of are we seeing this flow through in Q2 as expected? I would say, yes, the impact to Q1 and I think the impact to Q2 will be as expected, which is roughly $20,000,000 of revenue. So as we look at the first few weeks of our, what is our period for Q2, we certainly see an increase in activity and volume in China. We actually see a little bit of a step in all regions. I think this is in part customers trying to get out ahead of some of these supply challenges. And I do think we are also getting some additional share because we have been able to secure material. So I would say Q2 in China is certainly playing out as we expected. And we saw a little bit of a step up here that is probably related to concerns over supply availability.

Alright. Very helpful. And then just in terms of the raw material slate, I know that your slate skews towards specialty chemicals, and a lot of those are several steps removed from oil and gas. But just curious if you can talk about any specific materials or buckets or regions where you are starting to see some concerns about supply availability. And maybe help us understand a little bit better the timing of some of this inflationary impact on the P&L.

Sure. So as I mentioned in the script, we have already received over 40 force majeure notices. Now a lot of those, Mike, are coming from the Asia Pacific region. Reason for that is because so much of the crude in use in Asia Pacific and in China comes from the Middle Eastern region. So the materials that are impacted, when I mentioned that we were quick to raise price to try to get on top of these material increases, I will tell you, it is because we are already experiencing higher raw material costs. And in some cases, those price increases that I mentioned, they extend from the base level of 10% on up to 40% to 50% on some of our finished goods. There are examples that abound on different material categories and increases. VAM is a good example. The spot market in Europe for VAM was up 300% just recently. We have relationships in that particular material class where we have negotiated caps, negotiated extended availability, etc. And it goes like that in all materials. We do buy specialty chemicals mostly. Eighty-seven percent of what we buy is a specialty chemical. Normally, prices are influenced by the supply-demand balance within any one of those material classes. But this is a case where everything is impacted, and it is because so much of the crude feedstocks and even LNG availability has been impacted by this event.

Very helpful. Thanks very much.

Your next question comes from the line of Lucas Beaumont with UBS. Your line is open.

Good morning, Lucas.

Thanks for taking my question. So I was, yeah, I just wanted to follow up on the raw materials to start. So, I mean, kind of the way we have been looking at this at a high level is we sort of see oil up 25% to 50% on an annualized basis. Now, eventually, that is going to flow back down to kind of those tech chem intermediates. And for you guys, raws are 50% of your sales. So directionally, that would sort of seem to point to needing to get kind of 10% to 20% of pricing over time to kind of fully offset that. So, I mean, it is great you guys have gone out proactively with the first sort of 10%. So I was just wondering, is the right way to frame this that that is kind of a first step in the process, and then as we get further into this year, you will look to kind of go again as you need to.

Yeah. That is absolutely right, Lucas. So we knew we needed to get out early to get raw materials. Our team has been working on material acquisition for the last three weeks very aggressively. They saw everything was inflating, and it is not just raw material. It is also energy. It is also freight costs. And so what we knew was that 10% was a minimum that we needed to do across all materials. The team is also, as we speak, negotiating supplements for various raw material classes on top of that today. Now again, we want to be responsible in our pricing. We want to make sure we can acquire material for our customers. That is what it is all about right now: their supply security. And so we will likely have other instances throughout the year when we need to reconsider our pricing and look at these underlying material categories and see where we need to do more. But we are right now just at the first step.

Great. Thanks. And then, I guess, just as we look at the updated outlook for the year, it sort of seems like it is kind of implying pricing up seven to eight and sort of volumes down sort of five to six as you guys talked about. Could you give us a bit more kind of detail on what you are expecting across the segments on that front? Any areas where you are seeing more or less pressure on the volume side and more or less benefit on the pricing side? Thanks.

Yeah. So let me just talk about volume really quickly because I think that is going to be the most difficult part of this equation. So when we think about volume, on the plus side, we know we are going to be taking share. In fact, we have already, just last week, had three large global customers, existing customers, come to us and ask us if we could supply another application in their end product because they were unable to get their other supplier to supply them. So that share gain is real, and it is, like I said, an unusual time for us because we get to have a chance to see the existing market reallocated. That is on the plus side, but certainly the challenging thing on the volume side on the negative side will be what is going to happen as it relates to overall demand as this inflationary environment persists. And secondly, what we are considering is how much impact will there be from customers that cannot get other substrates or other raw material that go into their end product. They may have the adhesive from us, but they are going to have to get films and other components. And so that is the uncertain part of the equation.

Yeah. And I think, Lucas, just to build on that a little bit, I think the impact is going to be relatively similar across the GBUs in terms of the impact on volume. And certainly, if we look at our pricing actions, they are very consistent. Celeste mentioned in her remarks at the beginning the similarities to 2021 and 2022. And I think it would be really helpful for people to go back and look at that period. If you look at the results during that period, we were delivering mid-teens organic growth, about two-thirds from pricing and a third from volume, and it was very consistent across all three GBUs in terms of seeing improved volume and improved pricing. We are, in this environment, not counting on that improvement in volume. We know we will pick up some market share, but we are assuming that will be offset by overall demand destruction. But definitely the pricing actions being taken by all three GBUs sort of support a similar outcome.

Thanks very much.

Your next question comes from the line of Kevin McCarthy with Vertical Partners. Your line is open.

Yes. Thank you, and good morning. Celeste, can you elaborate on where you see the greatest opportunities to gain share either by product line, SBU, or region of the world, I guess, would be one question. And maybe related to that, as you suggested a lot of these FM declarations are coming out of Asia, which tends to be more of a spot market. And so I was wondering if you could talk through how you can achieve these share gains on a more durable basis rather than a transitory basis? Thanks.

Absolutely. So let us start with that last part. The way our sourcing organization works is, at the beginning of every year, we more heavily contract our raw materials and leave a lower portion of our raw material sourcing to spot buying. So we have very durable relationships, long-term relationships with the supply base, including and especially the supply base in China. And in fact, interestingly enough, while the U.S. and Europe have very strict rules on how materials are allocated in force majeure situations, that is not the case in other countries like China. And so as we have gone forward, we are committing long term to these suppliers that are able to supplement our needs today. And these are suppliers that over the long haul, whether we are talking about the U.S. or Europe or Asia, that we work closely with, and we have very strong relationships with. And so I see this as an opportunity to continue to partner with those suppliers, to continue to partner with our customers, and we will experience an environment where we are going to have a more healthy industry going forward. So if you look at the different business units and where the opportunities are, again, we buy specialty chemicals, but this impact has occurred across the board. And so I do see quite a number of opportunities to gain share in HHC, certainly, particularly because a lot of the raw material base for HHC comes out of China and is being highly and directly impacted. But we have also been very selective and thoughtful about how we use this opportunity to increase our position in those faster-growing higher-margin spaces, the opportunity where we have a greater opportunity to differentiate ourselves, like in EA or in BAS. And so the team does have targets as it relates to how they are thinking about this as an opportunity to grow their business, and they are doing it quite intentionally.

Kevin, I will just add one thing because your question around how do you make the share gains more durable. So we have, as Celeste said, situations where new customers and a lot of times previous customers have come to us and asked us to help out during this period of supply shortage, and we are happy to have old customers back. We are asking them to sign longer-term agreements. I think that is only fair that if we are helping them out in the situation that they are signing up. The other thing that it really does change, as Celeste alluded, it really does change the playing field. Because with this supply shortage, it is hard to be the low-cost supplier in this market because you cannot get the materials, and so it kind of collapses the playing field a little bit, which helps out those companies like us that compete based on quality and innovation and premium service. So those are the two things that I think are keys around making these share gains more durable.

I would think of it, Kevin, like a window of opportunity. A window in time. Because right now, while there are unmet needs, unfilled capacity, customers need material. All the barriers are down to getting share in the existing market. Now what will happen over time is the Middle East conflict will end. Material will be more available again. And, however, at the same time, that barrier wall goes back up because once a customer chooses an adhesive, it works online, they are likely not to change it unless there is a performance problem or a manufacturing problem because it is just not worth the risk.

That is very helpful. As the second question, John, I was wondering if you could provide some updated thoughts on your cash flow prospects for 2026 given everything that we have talked about. You have got some upward tension from earnings, but possibly some downward tension from working capital. So maybe you could just kind of talk through how you see the basket shaping up.

Sure. Yeah. So we did have a good start to the year from a cash flow standpoint in terms of performance relative to last year. Obviously, higher income. We are seeing better working capital performance in the first quarter than we did last year. So that is positive, and we are taking some very intentional actions. So we are confident. We are comfortable with our guidance. It is something we will watch. I think managing inventory will be a little trickier in this environment, and I think we are willing to live with a little higher inventory if it means helping secure supply assurance. But right now, I feel comfortable with it, but it is something we are monitoring. I would say that the biggest question will probably be around inventory management. We are doing a good job. I think we will continue to do a good job, but we will need to be a little flexible.

Great. Thank you.

Your next question comes from the line of Jeff Zekauskas with JPMorgan. Your line is open.

Thanks very much.

Morning, Jeff. Hi. Good morning.

It sounds like you are doing very well with your price initiatives. You did change your volume expectations for the year, I think, from something like negative one to negative five. Can you expand on the meaning of that change? That is, is it global economies slowing down? Is it something specific to the Health and Hygiene and Consumables segment? Why has your volume outlook changed so much?

Yeah. It is a balance, Jeff, of three things. So one is the positive impact of gaining share, the second is the negative impact of our customers potentially not being able to get other materials, other substrates to produce their product with, and then the third is some erosion in global demand in this inflationary environment. And so we believe the three of those things are likely more net negative than what we felt like coming into the year and also given this uncertainty. I think we need to be cautious as it relates to volume.

So, obviously, Europe has been the geography where natural gas prices have really risen, and fuel prices have lifted. Is Europe the area of particular concern, or is it more broad based?

No. It is broad based. I would say it is broad based. I do think that given the strides that the U.S. has made in becoming more energy independent, it may not be as bad here as it will be in certainly Europe. And Asia is still a question. Again, getting feedstocks in Asia is the most difficult right now. So, Jeff, one other thing to keep in mind when I say this, again, on average, we produce 97% of what we sell in a region for the region. And in the U.S., that is 99%. So, again, I feel like the U.S. is going to be a little more self-sufficient than some other parts of the world. But I would not say that any part of the world looks very good right now.

And then lastly, can you comment on two more issues?

Sure.

Which are your overall cost reduction aspirations, both what you had achieved in the first quarter and what you expect for the end of the year, and then secondly, can you comment on your solar-related revenues and what the decrements are there, if that is the right way to describe it?

I will take the cost reduction question. John, maybe you can address solar. So on the cost reduction question, we came into the year with $10,000,000 of benefit from Quantum Leap. We are increasing that to $15,000,000 this year given this reduction in volume and our decisions that are underway right now to continue to reduce costs to offset that.

Yeah. And, Jeff, you had asked about the impact of solar, which was about $12,500,000 of revenue in the quarter, and that is probably down 40%. So I think the impact from an overall company standpoint is about 1%. And for Engineering Adhesives, it was about a 4% impact. And then I apologize. I forgot what the other item was you asked about. Oh, I answered it. No. You got it. Okay. Okay. Good.

Thank you.

Thank you so much. Sure.

Your next question comes from the line of David Begleiter with Deutsche Bank. Your line is open.

Hi. This is Emily Fusco on for David Begleiter. Could you maybe just give some more color on order trends exiting FQ1 into March and kind of what you are seeing in terms of visibility given the uncertainty? I know you mentioned some uptick in China, but have you observed any pull-forward in demand or prebuying in other regions or anything to call out by segment? Thanks.

Sure, Emily. So in March, what we are seeing is higher revenue. So we have a good start on March. And we are also seeing improved margins in March. Now, of course, some of that is related to Chinese New Year and the bounce back that happens afterwards. I would say we are seeing customers that are anxious to get their orders in. We are avoiding filling orders far in excess of prior year’s demand. So the team has been really judicious about ensuring that we are not facilitating any hoarding. So I do not think we are seeing that yet, but it has been a robust month.

Your next question comes from the line of Ghansham Panjabi with Baird. Your line is open.

This is actually Josh Vesley on for Ghansham. Maybe if I could just ask one quick one here. I think in response to Jeff’s question, you talked about some of your customers not being able to procure raws to build some of their products. Can you just give some color on what specific GBU might be seeing an impact there more so relative to others? And yes, just any color there would be great. Thank you.

So, Josh, we are not seeing it yet. We are anticipating it. And I say that because when you think about polyethylene, polypropylene, they are in such a variety of goods. And so we have not heard yet of an instance where we have a customer that is unable to get their substrates, but we are anticipating that there will be some impact of that. And, again, that is an environment where we work very closely with our customers because the likelihood when they change their substrate is that they are going to need a different adhesive because adhesives are really so substrate-specific. So we are anticipating that we will see that and that we will be working closely with customers to reformulate our products or support them by introducing new products to be able to enable them to get a finished good to market.

Okay. Great. That is perfect. Thank you very much.

Your next question comes from the line of Rosemarie Morbelli with Gabelli Funds. Your line is open.

Thank you. Good morning, everyone.

Good morning, Rosemarie.

So one area we have not touched on is your latest acquisitions. So if we look, could you give us an update on the medical grade and the performance of the last acquisitions? And then this is a category that you are adding to previous acquisitions. So could we also have a ballpark number for the size of this entire entity?

So I will speak just to the medical business, Rosemarie, in Europe in particular this quarter. It was another good strong quarter. Our medical business in Europe was up almost 20%, again, organically. So we continue to see performance out of that business. We do not identify the size of any one of our market segments. And admittedly, the medical business is still small. But you can see it is growing rapidly with performance like that.

I expected that particular category to be affected by the price of oil. Or it is so specific that it will not make a difference.

You know, the amount of material used in those goods is really small. So it is a lot of cyanoacrylate. The raw material base is significantly comprised of cyanoacetates. And compared to the industrial use of those products, the medical use is much smaller. So that is one area where we are going to see less of an impact.

Okay. And then if I may follow up on a couple of questions, the solar comparison. When are you going to be at the level where it does not make any difference, so you have reached the bottom of that particular business.

Yeah. We will be wrapping that around by third quarter.

Okay. And should we expect similar impact in the next two quarters then?

Yeah. We are already at the trough revenue we expect there. So it will run rate at about this level.

Okay. And if I may, that 20% EBITDA margin that you are targeting, in this environment, can you still get to it by 2029? Or maybe it has been pushed out another year?

We can still get there.

But no timing. Okay. Thank you.

No. We are still really right on track, Rosemarie. And our objective for this year is to maintain margin. So we got out really early to make sure we were not going to see a big raw material margin lag impact. So we are really working hard to deliver on that 20% commitment over time.

I think we said by 2028, and I think that is still our target.

It was 2028, Rosemarie, not 2029.

See, I was already giving you a year.

I know. I should have run with that, but no.

Alright. Thank you very much.

Thank you.

I will now turn the call back to Celeste Mastin, the President and CEO, for closing remarks.

Thank you all for joining us this morning. We look forward to speaking with you again next quarter.

Ladies and gentlemen, that concludes today’s call. Thank you for joining. You may now disconnect.