Ecovyst, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Investments in Affiliated Companies

Investments in Affiliated Companies

6 Months Ended

Jun. 30, 2024

Equity Method Investments and Joint Ventures [Abstract]

9. Investments in Affiliated Companies:

The Company accounts for investments in affiliated companies under the equity method. Affiliated companies accounted for on the equity basis as of June 30, 2024 are as follows:

Company

Country

Percent
ownership

Zeolyst International

USA

50%

Zeolyst C.V.

Netherlands

50%

Following is summarized information of the combined investments(1):


	Three months ended June 30,				Six months ended June 30,
	2024		2023		2024		2023
Sales	$	70,644	$	99,188	$	127,505	$	155,085
Gross profit	16,751		34,461		33,929		44,571
Operating income	5,739		25,103		12,583		27,502
Net income	4,665		25,926		12,010		29,573

(1)Summarized information of the combined investments is presented at 100%; the Company’s share of the net assets and net income of affiliates is calculated based on the percent ownership specified in the table above.

The Company’s investments in affiliated companies balance as of June 30, 2024 and December 31, 2023 includes net purchase accounting fair value adjustments of $222,073 and $224,614, respectively, related to a prior business combination, consisting primarily of goodwill and intangible assets such as customer relationships, technical know-how and trade names. Consolidated equity in net income from affiliates is net of $940 and $2,541 of amortization expense related to purchase accounting fair value adjustments for the three and six months ended June 30, 2024, respectively. Consolidated equity in net income from affiliates is net of $1,601 and $3,201 of amortization expense related to purchase accounting fair value adjustments for the three and six months ended June 30, 2023, respectively.

The Company had receivables due from affiliates of $5,018 and $3,231 as of June 30, 2024 and December 31, 2023, respectively, which were included in prepaid and other current assets in the condensed consolidated balance sheets. The Company had payables from affiliates of $2,859 and $1,351 as of June 30, 2024 and December 31, 2023, which were included in accrued liabilities in the condensed consolidated balance sheets. Receivables and payables due from affiliates are generally non-trade.

Sales to affiliates were $2,110 for the three and six months ended June 30, 2024, respectively and $757 and $2,457 for the three and six months ended June 30, 2023, respectively. There were no purchases from affiliates for the three and six months ended June 30, 2024 and 2023, respectively.