Q2 2026 Balchem Corp Earnings Call

July 31, 2026

Operator 3: Hello, everyone. Thank you for joining us, welcome to the Balchem Q2 2026 Earnings Call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one. To withdraw your question, press star one again. I would now like to hand the conference over to Martin Bengtsson, Balchem CEO. Please go ahead.

Operator: Hello, everyone. Thank you for joining us, welcome to the Balchem Q2 2026 Earnings Call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one. To withdraw your question, press star one again. I would now like to hand the conference over to Martin Bengtsson, Balchem CEO. Please go ahead.

Speaker #1: If you would like to ask a question, please press *1. To withdraw your question, press *1 again. I would now like to hand the conference over to Martin Bengtsson, BALCHEM CEO.

Speaker #1: Please go ahead.

Speaker #2: Good morning, everyone. Thank you for joining our conference call this morning to discuss the results of BALCHEM Corporation for the quarter-ending June 30, 2026.

Martin Bengtsson: Morning, everyone. Thank you for joining our conference call this morning to discuss the results of Balchem Corporation for the quarter ending 30 June 2026. My name's Martin Bengtsson, Chief Financial Officer, and hosting this call with me is Ted Harris, our Chairman, President, and CEO. Following the advice of our counsel, auditors, and the SEC, at this time, I would like to read our forward-looking statement. Statements made in today's calls that are not historical facts are considered forward-looking statements. We can give no assurance that the expectations reflected in forward-looking statements will prove correct, and various factors could cause actual results to differ materially from our expectations, including risks and factors identified in Balchem's most recent Form 10-K, 10-Q, and 8-K reports. The company assumes no obligation to update these forward-looking statements. Today's call and commentary also include non-GAAP financial measures.

Speaker #2: My name’s Martin Bengtsson, Chief Financial Officer, and hosting this call with me is Ted Harris, our Chairman, President, and CEO. Following the advice of our counsel, auditors, and the SEC, at this time I would like to read our forward-looking statement.

Speaker #2: Statements made in today's calls that are not historical facts are considered forward-looking statements. We can give no assurance that the expectations reflected in forward-looking statements will prove correct, and various factors could cause actual results to differ materially from our expectations.

Martin Bengtsson: Statements made in today's calls that are not historical facts are considered forward-looking statements. We can give no assurance that the expectations reflected in forward-looking statements will prove correct, and various factors could cause actual results to differ materially from our expectations, including risks and factors identified in Balchem's most recent Form 10-K, 10-Q, and 8-K reports.

Speaker #2: Including risks and factors identified in Balchem's most recent Form 10-K, 10-Q, and 8-K reports, the company assumes no obligation to update these forward-looking statements.

Martin Bengtsson: The company assumes no obligation to update these forward-looking statements. Today's call and commentary also include non-GAAP financial measures. Please refer to the reconciliations in our earnings release for further details. I will now turn the call over to Ted Harris, our Chairman, President, and CEO.

Speaker #2: Today's call and commentary also include non-GAAP financial measures. Please refer to the reconciliations in our earnings release for further details. I will now turn the call over to Ted Harris, our Chairman, President, and CEO.

Martin Bengtsson: Please refer to the reconciliations in our earnings release for further details. I will now turn the call over to Ted Harris, our Chairman, President, and CEO.

Speaker #3: Thanks, Martin. Good morning, and welcome to our conference call. We were extremely pleased with our second quarter performance, reported this morning, which was once again driven by healthy broad-based growth across all three of our reporting segments.

Ted Harris: Thanks, Martin. Good morning and welcome to our conference call. We were extremely pleased with our Q2 performance reported this morning, which was once again driven by healthy, broad-based growth across all three of our reporting segments and continued solid execution on our strategic growth initiatives. Our healthy growth continues to be fueled by the ongoing market penetration of our unique portfolio of specialty nutrients and delivery systems, and the favorable better-for-you trends within the food and nutrition markets that are well-aligned with our product offerings and capabilities. As a result, we delivered record quarterly consolidated sales, adjusted EBITDA, and adjusted net earnings, as well as solid cash flows.

Speaker #3: And we continued solid execution on our strategic growth initiatives. Our healthy growth continues to be fueled by the ongoing market penetration of our unique portfolio of specialty nutrients and delivery systems, as well as the favorable better-for-you trends within the food and nutrition markets that are well aligned with our product offerings and capabilities.

Ted Harris: Our healthy growth continues to be fueled by the ongoing market penetration of our unique portfolio of specialty nutrients and delivery systems, and the favorable better-for-you trends within the food and nutrition markets that are well-aligned with our product offerings and capabilities. As a result, we delivered record quarterly consolidated sales, adjusted EBITDA, and adjusted net earnings, as well as solid cash flows.

Speaker #3: As a result, we delivered record quarterly consolidated sales, adjusted EBITDA, and adjusted net earnings, as well as solid cash flows. Before discussing our second quarter financial results in more detail, I'd like to take a moment to comment on the broader operating environment within each of our business of progress in the quarter particularly within our capital allocation strategy.

Ted Harris: Before discussing our Q2 financial results in more detail, I'd like to take a moment to comment on the broader operating environment within each of our business segments and highlight a few areas of progress in the Q2, particularly within our capital allocation strategy. Demand trends across our businesses remain healthy. Our unique portfolio, strong market positions, and focus on innovation continue to drive above-market growth. Within Human Nutrition & Health, we delivered another very strong Q2, supported by solid demand across both our nutrients portfolio and our food ingredients and solutions businesses. Heightened interest in supplementation and healthier nutrient dense, high protein, high fiber, and lower sugar products continues to create opportunities for our customers and subsequently, our science-based ingredients, formulation expertise, and application capabilities.

Speaker #3: Demand trends across our businesses remain healthy. Our unique portfolio, strong market positions, and focus on innovation continue to drive above-market growth. Within human nutrition and health, we delivered another very strong quarter, supported by solid demand across both our nutrients portfolio and our food ingredients and solutions businesses.

Ted Harris: Within Human Nutrition & Health, we delivered another very strong Q2, supported by solid demand across both our nutrients portfolio and our food ingredients and solutions businesses. Heightened interest in supplementation and healthier nutrient dense, high protein, high fiber, and lower sugar products continues to create opportunities for our customers and subsequently, our science-based ingredients, formulation expertise, and application capabilities.

Speaker #3: Heightened interest in supplementation and healthier nutrient-dense high-protein high-fiber and lower-sugar products continues to create opportunities for our customers and subsequently our science-based ingredients formulation expertise and application capabilities.

Speaker #3: In animal nutrition and health, we continue to generate healthy growth as a result of both expanding adoption of our precision-release, rumen-protected nutrient technologies within the dairy industry, as well as realizing higher year-over-year volumes and margins in our European monogastric business.

Ted Harris: In Animal Nutrition & Health, we continue to generate healthy growth as a result of both expanding adoption of our precision-release rumen-protected nutrient technologies within the dairy industry, as well as realizing higher year-over-year volumes and margins in our European monogastric business. We remain encouraged by the momentum across our Animal Nutrition & Health portfolio and the value our products provide to producers seeking greater efficiency, productivity, and sustainability. Specialty Products also continues to drive healthy top and bottom-line growth on solid volume and pricing growth, particularly within our performance gases business. Demand trends across our businesses remain healthy, and each of our reporting segments is performing well. On a consolidated basis, we delivered strong growth and healthy margins despite higher input costs related to the conflict in the Middle East as a result of both mitigating actions and growth-driven operating leverage.

Speaker #3: We remain encouraged by the momentum across our animal nutrition and health portfolio, and the value our products provide to producers seeking greater efficiency, productivity, and sustainability.

Ted Harris: We remain encouraged by the momentum across our Animal Nutrition & Health portfolio and the value our products provide to producers seeking greater efficiency, productivity, and sustainability. Specialty Products also continues to drive healthy top and bottom-line growth on solid volume and pricing growth, particularly within our performance gases business.

Speaker #3: And especially products also continues to drive healthy top and bottom line growth on solid volume and pricing growth, particularly within our performance gases business.

Speaker #3: So, demand trends across our businesses remain healthy, and each of our reporting segments is performing well. On a consolidated basis, we delivered strong growth and healthy margins, despite higher input costs related to the conflict in the Middle East.

Ted Harris: Demand trends across our businesses remain healthy, and each of our reporting segments is performing well. On a consolidated basis, we delivered strong growth and healthy margins despite higher input costs related to the conflict in the Middle East as a result of both mitigating actions and growth-driven operating leverage.

Speaker #3: As a result of both mitigating actions and growth-driven operating leverage, we remain confident in our ability to drive continued growth and margin performance going forward.

Ted Harris: We remain confident in our ability to drive continued growth and margin performance going forward. On the capital allocation front, consistent with our balanced approach to capital allocation, we took several actions during the quarter to enhance financial flexibility and return capital to shareholders. First, we recently completed the refinancing of our revolving credit facility. The new amended agreement increases our borrowing capacity from $550 million to $650 million and extends the maturity of this facility into 2031. This transaction further strengthens our financial position and provides additional flexibility to support our growth strategy, including continued investment in innovation, capacity expansion, and strategic acquisition opportunities. Second, we repurchased approximately $29 million of Balchem common stock during Q2 and $114 million over the trailing 12 months, reflecting our continued commitment to disciplined capital allocation and shareholder value creation. Now, regarding the Q2 financial performance.

Speaker #3: On the capital allocation front, consistent with our balanced approach to capital allocation, we took several actions during the quarter to enhance financial flexibility and return capital to shareholders.

Speaker #3: First, we recently completed the refinancing of our revolving credit facility. The new amended agreement increases our borrowing capacity from $550 million to $650 million and extends the maturity of the facility into 2031.

Ted Harris: The new amended agreement increases our borrowing capacity from $550 million to $650 million and extends the maturity of this facility into 2031. This transaction further strengthens our financial position and provides additional flexibility to support our growth strategy, including continued investment in innovation, capacity expansion, and strategic acquisition opportunities.

Speaker #3: This transaction further strengthens our financial position and provides additional flexibility to support our growth strategy, including continued investment in innovation, capacity expansion, and strategic acquisition opportunities.

Speaker #3: Second, we repurchased approximately $29 million of Balchem common stock during the second quarter, and $114 million over the trailing 12 months, reflecting our continued commitment to disciplined capital allocation and shareholder value creation.

Ted Harris: Second, we repurchased approximately $29 million of Balchem common stock during Q2 and $114 million over the trailing 12 months, reflecting our continued commitment to disciplined capital allocation and shareholder value creation. Now, regarding the Q2 financial performance.

Speaker #3: Now, regarding the second quarter financial performance, this morning we reported record quarterly consolidated revenue of $284 million, an increase of 11.2 percent versus the prior year.

Ted Harris: This morning, we reported record quarterly consolidated revenue of $284 million, an increase of 11.2% versus the prior year. We delivered record quarterly GAAP earnings from operations of $59 million, an increase of 15.1% versus the prior year. Consolidated net income closed the quarter at a record $45 million, an increase of 16.6%. This quarterly net income translated to diluted net earnings per share of $1.39 on a GAAP basis, up 18.8%. On an adjusted basis, we delivered record quarterly adjusted EBITDA of $78 million, an increase of 12.6%. Our quarterly adjusted net earnings were a record $48 million, an increase of 15.7%, which translated to $1.49 per diluted share, up 17.3%. Overall, we delivered an outstanding Q2, highlighted by record financial results, broad-based growth across our businesses, the strengthening of our balance sheet via our newly amended credit facility, and continued execution on our long-term strategic objectives.

Speaker #3: We delivered record quarterly GAAP earnings from operations of $59 million, an increase of 15.1 percent versus the prior year. Consolidated net income closed the quarter at a record $45 million, an increase of 16.6 percent.

Speaker #3: This quarterly net income translated to diluted net earnings per share of 1 dollar and 39 cents on a GAAP basis, up 18.8 percent. On an adjusted basis, we delivered record quarterly adjusted EBITDA of 78 million dollars and increase of 12.6 percent.

Ted Harris: On an adjusted basis, we delivered record quarterly adjusted EBITDA of $78 million, an increase of 12.6%. Our quarterly adjusted net earnings were a record $48 million, an increase of 15.7%, which translated to $1.49 per diluted share, up 17.3%.

Speaker #3: Our quarterly adjusted net earnings were a record 48 million dollars and increase of 15.7 percent, which translated to 1 dollar and 49 cents per diluted share, up 17.3 percent.

Speaker #3: Overall, we delivered an outstanding second quarter, highlighted by record financial results, broad-based growth across our businesses, the strengthening of our balance sheet via our newly amended credit facility, and continued execution on our long-term strategic objectives.

Ted Harris: Overall, we delivered an outstanding Q2, highlighted by record financial results, broad-based growth across our businesses, the strengthening of our balance sheet via our newly amended credit facility, and continued execution on our long-term strategic objectives. With that, I'm now going to turn the call back over to Martin to go through the Q2 financial results in more detail and the results for each of our business segments.

Speaker #3: And with that, I'm now going to turn the call back over to Martin to go through the second-quarter financial results in more detail, as well as the results for each of our business segments.

Ted Harris: With that, I'm now going to turn the call back over to Martin to go through the Q2 financial results in more detail and the results for each of our business segments.

Speaker #2: Thank you, Ted. The second quarter was another strong quarter. Our record second quarter net sales of $284 million were up 11.2 percent compared to the prior year.

Martin Bengtsson: Thank you, Ted. The Q2 was another strong quarter. Our record Q2 net sales of $284 million were up 11.2% compared to prior year, driven by strong performances across all three segments: Human Nutrition & Health, Animal Nutrition & Health, and Specialty Products. Our gross margin dollars were $104 million, up 11.4%, and our gross margin percent expanded to 36.5% of sales, up 10 basis points. The gross margin performance was driven primarily by sales growth and manufacturing efficiencies, partially offset by certain higher manufacturing input costs. Consolidated operating expenses for the Q2 were $44 million as compared to $42 million in the prior year. The increase was primarily due to higher compensation-related costs. GAAP earnings from operations for the Q2 were a record $59 million, an increase of 15.1%.

Speaker #2: Driven by strong performances across all three segments—human nutrition and health, animal nutrition and health, and especially products—our gross margin dollars were $104 million, up 11.4 percent, and our gross margin percent expanded to 36.5 percent of sales, up 10 basis points.

Speaker #2: The gross margin performance was driven primarily by sales growth and manufacturing efficiencies, partially offset by certain higher manufacturing input costs. Consolidated operating expenses for the second quarter were $44 million, as compared to $42 million in the prior year.

Martin Bengtsson: The gross margin performance was driven primarily by sales growth and manufacturing efficiencies, partially offset by certain higher manufacturing input costs. Consolidated operating expenses for the Q2 were $44 million as compared to $42 million in the prior year. The increase was primarily due to higher compensation-related costs. GAAP earnings from operations for the Q2 were a record $59 million, an increase of 15.1%.

Speaker #2: The increase was primarily due to higher compensation-related costs. GAAP earnings from operations for the second quarter were a record $59 million, an increase of 15.1 percent.

Speaker #2: On an adjusted* basis, morning record non-GAAP earnings from operations of $64 million were up 13.9 percent. Adjusted EBITDA was a record $78 million, an increase of 12.6 percent, with an adjusted EBITDA margin rate of 27.4 percent.

Martin Bengtsson: On an adjusted basis, as detailed in our earnings release this morning, record non-GAAP earnings from operations of $64 million were up 13.9%. Adjusted EBITDA was a record $78 million, an increase of 12.6% with an adjusted EBITDA margin rate of 27.4%. Net interest expense for the Q2 was $2 million, a decrease of $1 million, primarily driven by lower outstanding borrowings and lower interest rates. Our net debt was $89 million, with an overall leverage ratio on a net debt basis of 0.3. The effective tax rates for the Q2s of 2026 and 2025 were 22.8% and 21.9% respectively. The increase in the effective tax rate from the prior year was primarily due to lower tax benefits from stock-based compensation. Consolidated net income closed the quarter at a record $45 million, up 16.6%.

Speaker #2: Net interest expense for the second quarter was 2 million dollars, a decrease of 1 million dollars, primarily driven by lower outstanding borrowings and lower interest rates.

Speaker #2: Our net debt was 89 million dollars, with an overall leverage ratio on a net debt basis of 0.3. The effective tax rates for the second quarters of 2026 and 2025 were 22.8 percent and 21.9 percent respectively.

Martin Bengtsson: Our net debt was $89 million, with an overall leverage ratio on a net debt basis of 0.3. The effective tax rates for the Q2s of 2026 and 2025 were 22.8% and 21.9% respectively. The increase in the effective tax rate from the prior year was primarily due to lower tax benefits from stock-based compensation. Consolidated net income closed the quarter at a record $45 million, up 16.6%.

Speaker #2: The increase in the effective tax rate from the prior year was primarily due to lower tax benefits from stock-based compensation. Consolidated net income closed the quarter at a record $45 million, up 16.6%.

Speaker #2: This quarterly net income translated into diluted net earnings per share, of 1 dollar and 39 cents, and 18.8 percent increase. On an adjusted basis, our second quarter adjusted net earnings were a record 48 million dollars and increase of 15.7 percent, which translated to 1 dollar and 49 cents per diluted share.

Martin Bengtsson: This quarterly net income translated into diluted net earnings per share of $1.39, an 18.8% increase. On an adjusted basis, our Q2 adjusted net earnings were a record $48 million, an increase of 15.7%, which translated to $1.49 per diluted share. Cash flows from operations were $47 million with free cash flow of $36 million. We closed out the quarter with $63 million of cash on the balance sheet. As we look at the Q2 from a segment perspective, our Human Nutrition & Health segment saw record sales of $177 million, up 10%, driven by growth in both our nutrients business and our food ingredients and solutions businesses. Record earnings from operations of $42 million were up 10.5%, driven by the higher sales and favorable mix, partially offset by certain higher manufacturing input costs and higher operating expenses.

Speaker #2: Cash flows from operations were $47 million, with free cash flow of $36 million, and we closed out the quarter with $63 million of cash on the balance sheet.

Speaker #2: As we look at the second quarter from a segment perspective, our Human Nutrition and Health segment saw record sales of $177 million, up 10 percent, driven by growth in both our nutrients business and our food ingredients and solutions businesses.

Martin Bengtsson: As we look at the Q2 from a segment perspective, our Human Nutrition & Health segment saw record sales of $177 million, up 10%, driven by growth in both our nutrients business and our food ingredients and solutions businesses. Record earnings from operations of $42 million were up 10.5%, driven by the higher sales and favorable mix, partially offset by certain higher manufacturing input costs and higher operating expenses.

Speaker #2: Record earnings from operations of $42 million were up 10.5 percent, driven by higher sales and a favorable mix, partially offset by certain higher manufacturing input costs and higher operating expenses.

Speaker #2: Second quarter adjusted earnings from operations for this segment were a record 46 million dollars, up 10.9 percent. We are excited about the growth outlook for human nutrition and health.

Martin Bengtsson: Q2 adjusted earnings from operations for this segment were a record $46 million, up 10.9%. We are excited about the growth outlook for Human Nutrition & Health, where consumer demand for healthier nutritional solutions continues to support growth. Our differentiated ingredients, formulation expertise, and branded portfolio position us well to continue serving our customers and expanding our market opportunities. Our Animal Nutrition & Health segment delivered sales of $64 million, up 15%. The increase was driven by higher sales in both the monogastric and ruminant businesses. Animal Nutrition & Health delivered earnings from operations of $5 million, up 48.7%, driven by the higher sales, partially offset by certain higher manufacturing input costs and higher operating expenses. Q2 adjusted earnings from operations for this segment were $6 million, up 47.7%. We delivered another quarter of improved year-over-year performance in our Animal Nutrition & Health segment.

Speaker #2: We're consumer demand for healthier nutritional solutions continues to support growth. Our differentiated ingredients, formulation expertise, and branded portfolio position us well to continue serving our customers and expanding our market opportunities.

Speaker #2: Our Animal Nutrition and Health segment delivered sales of $64 million, up 15 percent. The increase was driven by higher sales in both the monogastric and ruminant businesses.

Martin Bengtsson: Our Animal Nutrition & Health segment delivered sales of $64 million, up 15%. The increase was driven by higher sales in both the monogastric and ruminant businesses. Animal Nutrition & Health delivered earnings from operations of $5 million, up 48.7%, driven by the higher sales, partially offset by certain higher manufacturing input costs and higher operating expenses.

Speaker #2: Animal nutrition and health delivered earnings from operations of 5 million dollars, up 48.7 percent, driven by the higher sales partially offset by certain higher manufacturing input costs and higher operating expenses.

Speaker #2: Second quarter adjusted earnings from operations for this segment were $6 million, up 47.7%. We delivered another quarter of improved year-over-year performance in our Animal Nutrition and Health segment.

Martin Bengtsson: Q2 adjusted earnings from operations for this segment were $6 million, up 47.7%. We delivered another quarter of improved year-over-year performance in our Animal Nutrition & Health segment. Growth was driven by continued adoption of our encapsulated rumen-protected nutrient technologies in the dairy markets, stable demand in our US monogastric business, and ongoing improvement in our European monogastric business following the implementation of EU anti-dumping duties.

Speaker #2: Growth was driven by continued adoption of our encapsulated, rumen-protected nutrient technologies in the dairy market, stable demand in our U.S. monogastric business, and ongoing improvement in our European monogastric business following the implementation of EU anti-dumping duties.

Martin Bengtsson: Growth was driven by continued adoption of our encapsulated rumen-protected nutrient technologies in the dairy markets, stable demand in our US monogastric business, and ongoing improvement in our European monogastric business following the implementation of EU anti-dumping duties. We were also pleased with the year-over-year margin improvement delivered in the quarter within ANH, despite higher input costs related to the conflict in the Middle East as a result of both mitigating actions taken and growth-driven operating leverage. We are encouraged by the momentum across the Animal Nutrition & Health segment and remain confident in our ability to continue expanding adoption of our technologies and delivering long-term growth. Our Specialty Products segment delivered record quarterly sales of $41 million, up 8.9%, driven by healthy growth in both performance gases and plant nutrition businesses.

Speaker #2: And we were also pleased with the year-over-year margin improvement delivered in the quarter within A&H, despite higher input costs related to the conflict in the Middle East, as a result of both mitigating actions taken and growth-driven operating leverage.

Martin Bengtsson: We were also pleased with the year-over-year margin improvement delivered in the quarter within ANH, despite higher input costs related to the conflict in the Middle East as a result of both mitigating actions taken and growth-driven operating leverage.

Speaker #2: We're encouraged by the momentum across the animal nutrition and health segment and remain confident in our ability to continue expanding adoption of our technologies and delivering long-term growth.

Martin Bengtsson: We are encouraged by the momentum across the Animal Nutrition & Health segment and remain confident in our ability to continue expanding adoption of our technologies and delivering long-term growth. Our Specialty Products segment delivered record quarterly sales of $41 million, up 8.9%, driven by healthy growth in both performance gases and plant nutrition businesses.

Speaker #2: Our Specialty Products segment delivered record quarterly sales of $41 million, up 8.9 percent, driven by healthy growth in both Performance Gases and Plant Nutrition businesses.

Speaker #2: Specialty Products delivered record quarterly earnings from operations of $13 million, up 14.4 percent, driven primarily by higher sales, partially offset by certain higher manufacturing input costs and higher operating expenses.

Martin Bengtsson: Specialty Products delivered a record quarterly earnings from operations of $13 million, up 14.4%, driven primarily by higher sales, partially offset by certain higher manufacturing input costs and higher operating expenses. Q2 adjusted earnings from operations for this segment were a record $14 million, up 12.1%. We were encouraged by the continued strong performance in Specialty Products, which once again delivered healthy, profitable growth. Supported by favorable market positions and disciplined execution, we believe the segment remains well-positioned for continued success. Overall, our Q2 reflects all-time record financial performance, continued momentum across our businesses, and strong execution across the organization. With that, I will turn the call back over to Ted for some closing remarks.

Speaker #2: Second quarter adjusted earnings from operations for this segment were a record $14 million, up 12.1 percent. We were encouraged by the continued strong performance in specialty products, which once again delivered healthy, profitable growth.

Martin Bengtsson: We were encouraged by the continued strong performance in Specialty Products, which once again delivered healthy, profitable growth. Supported by favorable market positions and disciplined execution, we believe the segment remains well-positioned for continued success. Overall, our Q2 reflects all-time record financial performance, continued momentum across our businesses, and strong execution across the organization. With that, I will turn the call back over to Ted for some closing remarks.

Speaker #2: Supported by favorable market positions and disciplined execution, we believe the segment remains well-positioned for continued success. Overall, our second quarter reflects all-time record financial performance continued momentum across our businesses and strong execution across the organization.

Speaker #2: With that, I'll turn the call back over to Ted for some closing remarks.

Speaker #1: Thanks, Martin. We are very pleased with the results we reported earlier today. Our teams executed exceptionally well during the quarter, delivering record financial performance while continuing to advance our strategic priorities.

Ted Harris: Thanks, Martin. We are very pleased with the results we reported earlier today. Our teams executed exceptionally well during the quarter, delivering record financial performance while continuing to advance our strategic priorities. Q2 of 2026 was our 28th consecutive quarter of year-over-year growth in adjusted EBITDA. We believe this achievement reflects the strength of our unique portfolio, the resilience of our business model, and the consistent execution of our teams across a wide range of market conditions. As a team, we are extremely proud of these results and excited about the future of our company. I will now hand the call back over to Martin, who will open up the call for questions.

Speaker #1: The second quarter of 2026 was our 28th consecutive quarter of year-over-year growth in adjusted EBITDA. We believe this achievement reflects the strength of our unique portfolio and the resilience of our business model and the consistent execution of our team's across a wide range of market conditions.

Ted Harris: We believe this achievement reflects the strength of our unique portfolio, the resilience of our business model, and the consistent execution of our teams across a wide range of market conditions. As a team, we are extremely proud of these results and excited about the future of our company. I will now hand the call back over to Martin, who will open up the call for questions.

Speaker #1: And as a team, we are extremely proud of these results and excited about the future of our company. I will now hand the call back over to Martin, who will open up the call for questions.

Speaker #2: Thank you, Ted. This now concludes the formal portion of the conference. At this point, we will open up the conference call for questions.

Martin Bengtsson: Thank you, Ted. This now concludes the formal portion of the conference. At this point, we will open up the conference call for questions.

Speaker #3: And we are now opening the question-and-answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one to raise your hand.

Operator 3: We are now opening the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Now, please stand by while we compile the Q&A roster. Your first question comes from the line of Bob Labick with CJS Securities. Your line is open. Please go ahead.

Operator: We are now opening the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality.

Speaker #3: To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality.

Speaker #3: If you're muted locally, please remember to unmute your device. Now, please stand by while we compile the Q&A roster. Your first question comes from the line of Bob Labbock with CJS Securities.

Operator: If you are muted locally, please remember to unmute your device. Now, please stand by while we compile the Q&A roster. Your first question comes from the line of Bob Labick with CJS Securities. Your line is open. Please go ahead.

Speaker #3: Your line is open. Please go ahead.

Speaker #4: Good morning. Congratulations on continued strength and record results.

Bob Labick: Good morning. Congratulations on continued strength and record results.

Speaker #2: Thanks, Bob.

Ted Harris: Thanks, Bob.

Speaker #4: Yeah. You've been really successful in growing minerals and nutrients in particular, choline, K2, magnesium, and more. My question is, how do you evaluate new products?

Bob Labick: Yeah. You have been really successful in growing minerals and nutrients, in particular choline, K2, magnesium, and more. My question is, how do you evaluate new products? Is it based on where you can improve bioavailability or markets or what? How do you evaluate new products for that area, and then how do you decide if it is a kind of build versus buy opportunity to enter markets for new products?

Speaker #4: Is it based on where you can improve bioavailability or markets, or what? And so how do you evaluate new products for that area? And then, how do you decide if it's a kind of build-versus-buy opportunity to enter markets for new products?

Speaker #1: Yeah, thanks for the question, Bob. We're really pleased with the performance of the nutrients business, as well as the food ingredients and solutions part of H&H, both contributing to very, very strong results in our Human Nutrition and Health business.

Ted Harris: Thanks for the question, Bob Labick. We're really pleased with the performance of the nutrients business as well as the food ingredients and solutions part of H&H, both contributing to very strong results in our Human Nutrition & Health business. Specifically in nutrients, as you know, over the years, we have developed our own products, sometimes with outside partners in the case of Optifolin+ that we launched a year or so ago. That's a good example of a kind of an internal development with external support. Then we've acquired technologies like we did with vitamin K2 in buying Kappa Bioscience. I think it has to do with how you select which path to go down. It has to do with how close is that technology to our core. For example, in Optifolin+, part of the backbone of that technology is choline.

Speaker #1: And specifically in Nutrients, as you know, over the years we have developed our own products—sometimes with outside partners, in the case of Optifol and Plus, that we launched a year or so ago.

Speaker #1: That's a good example of a kind of internal development with external support. And then with acquired technologies, like we did with vitamin K2 and buying Kappa Solutions.

Ted Harris: Then we've acquired technologies like we did with vitamin K2 in buying Kappa Bioscience. I think it has to do with how you select which path to go down. It has to do with how close is that technology to our core. For example, in Optifolin+, part of the backbone of that technology is choline.

Speaker #1: And I think it has to do with how you select which path to go down. It has to do with how close that technology is to our core.

Speaker #1: And, for example, in Optifol and Plus, part of the backbone of that technology is choline. And so we were able to use our expertise to expand into that technology with an outside partner, and so that was more sort of ripe for internal development, if you will.

Ted Harris: So we were able to use our expertise to expand into that technology with an outside partner. So that was more sort of ripe for internal development, if you will, whereas the vitamin K2 was very different technology, so it made sense to do that through acquisition. When we step back and look at the marketplace, how do we decide which nutrients we want to invest in and we think would be valuable as part of our portfolio? Certainly, one thing we start with is the science. We want to make sure there is already good existing sound science behind the products that we're bringing in, and I think that clearly has been true with all of the additions to our portfolio over the years. The science is really important.

Speaker #1: Whereas the vitamin K2 was very different technology. And so it made sense to do that through acquisition. But when we step back and look at the marketplace, how do we decide which nutrients we want to invest in?

Speaker #1: And we think it would be valuable as part of our portfolio. Certainly, one thing we start with is the science. We want to make sure there is already good, existing, sound science that we're bringing in.

Ted Harris: Certainly, one thing we start with is the science. We want to make sure there is already good existing sound science behind the products that we're bringing in, and I think that clearly has been true with all of the additions to our portfolio over the years. The science is really important.

Speaker #1: And I think that clearly has been true with all of the additions to our portfolio over the years. So, the science is really important.

Speaker #1: And then, kind of as you touched on, I think it's the, what is our point of differentiation that's going to make our product different and more special, and so forth.

Ted Harris: Then kind of as you touched on, I think it's the what is our point of differentiation that's going to make our product different and more special and so forth. I think that's also a very important aspect to the product. For example, when we bought Kappa Bioscience and vitamin K2, it was very important to us that one of the primary forms of K2 that Kappa Bioscience had was an encapsulated K2 that was protected with patent, very different, unique, and special in the marketplace. Lots of points of differentiation there and moats, if you will, on that product. Differentiation, I think, is another key point. The other thing we like to look at is how well penetrated is that nutrient. Our nutrients, still, even after many years of efforts, still are relatively well-known.

Speaker #1: I think that's also a very, very important aspect to the product. For example, when we bought Kappa Solutions and vitamin K2, it was very important to us that one of the primary forms of K2 that Kappa Solutions had was an encapsulated K2 that was protected with a patent.

Speaker #1: It was very different, very unique, and very special in the marketplace—so lots of points of differentiation there, and moats, if you will, on that product.

Ted Harris: Lots of points of differentiation there and moats, if you will, on that product. Differentiation, I think, is another key point. The other thing we like to look at is how well penetrated is that nutrient. Our nutrients, still, even after many years of efforts, still are relatively well-known.

Speaker #1: So, differentiation, I think, is another key point. The other thing we like to look at is how well-penetrated that nutrient is. Our nutrients, still, even after many years of efforts, are relatively well-known.

Speaker #1: They're increasing in awareness and increasing in market penetration. But it's a very different dynamic if you have a nutrient that, from your perspective, is fully penetrated in the marketplace and has very high awareness—like, for example, I'll say vitamin D3.

Ted Harris: They're increasing in awareness and market penetration. It's a very different dynamic if you have a nutrient that from your perspective is fully penetrated in the marketplace, has very high awareness. Like for example, I'll say vitamin D3. Our nutrients tend to be lesser known, more nichey, and we have a real opportunity with that science and that differentiation to drive awareness, market penetration, and really drive above market growth rates. I think you can see evidence of that on all of our products that are part of our nutrient portfolio. I think those are sort of the key elements that we look at, and we're excited by the fact that we do see opportunities in the marketplace to add additional products to our nutrient portfolio, and we're working hard on that.

Speaker #1: Our nutrients tend to be lesser known, more niche, and we have a real opportunity with that science and that differentiation to drive awareness, drive market penetration, and really drive above market growth rates and I think you can see evidence of that on all of our products that are part of our nutrient portfolio.

Ted Harris: I think you can see evidence of that on all of our products that are part of our nutrient portfolio. I think those are sort of the key elements that we look at, and we're excited by the fact that we do see opportunities in the marketplace to add additional products to our nutrient portfolio, and we're working hard on that.

Speaker #1: So I think those are sort of the key elements that we look at. And we're excited by the fact that we do see opportunities in the marketplace to add additional products to our nutrient portfolio.

Speaker #1: And we're working hard on that.

Speaker #4: Okay, great. And you mentioned the science as part of the differentiation and everything. Maybe this isn't really an every-quarter question because I know it's not that fast, but I know you have a number of trials out there.

Bob Labick: Okay, great. You mentioned the science as part of the differentiation and everything. Maybe this isn't a kind of every quarter question because I know it's not this fast, but I know you have a number of trials out there. I was wondering if you could give us any updates on some of the trials that may come to fruition in this year, then I guess just more broadly, how you use that information once you get it to help grow the business.

Speaker #4: I was wondering if you could give us any updates on some of the trials that may come to fruition this year and, then, I guess just more broadly, how you use that information once you get it to help grow the business.

Speaker #1: Yes, certainly investing in clinical studies, and as I've referred to it, the science behind our products, is really an important part of what we do.

Ted Harris: Yes, certainly investing in clinical studies and as I've referred to it, the science behind our products, is really an important part of what we do. It's how we help our customers have claims for their own products, which is an important part of marketing. It's a fairly significant investment. At any one time, we have 20, 25 ongoing studies out there. You're right, some of these take many years. Some are a little bit shorter. There were four studies of note in the last quarter, one on Optifolin+, two on K2VITAL, and one on VitaCholine that are all really good studies and further enhance our already kind of broad library of studies for the products.

Speaker #1: It's how we help our customers have claims for their own products, which is an important part of marketing. So it's a fairly significant investment at any one time.

Ted Harris: At any one time, we have 20, 25 ongoing studies out there. You're right, some of these take many years. Some are a little bit shorter. There were four studies of note in the last quarter, one on Optifolin+, two on K2VITAL, and one on VitaCholine that are all really good studies and further enhance our already kind of broad library of studies for the products. It just kind of gives you a feel this is ongoing, and these are all a little bit different, but kind of add to that portfolio and add to that science behind our products.

Speaker #1: We have 20 to 25 ongoing studies out there. And you're right, some of these take many years; some are a little bit shorter. There were four studies of note in the last quarter: one on Optifol and Plus, two on K2Vital, and one on Vitacoline. These are all really good studies and further enhance our already broad library of studies for the products.

Speaker #1: It just kind of gives you a feel. This is ongoing and these are all a little bit different. But kind of add to that portfolio and add to that science behind our products.

Ted Harris: It just kind of gives you a feel this is ongoing, and these are all a little bit different, but kind of add to that portfolio and add to that science behind our products. The one that I am excited about, unfortunately, I don't have an update today, but I'm very excited about, is one that I've talked about in the past, that's the MD Anderson, The University of Texas, MIT pilot clinical study, that has people in the study that have the APOE4 gene, which is really the gene that leads to Alzheimer's. It is an adult cognition study that I'm excited to ultimately get the results about and hopefully be able to talk significantly about.

Speaker #1: The one that I am excited about—and unfortunately, I don't have an update today, but I'm very excited about—is one that I've talked about in the past, and that's the MD Anderson.

Ted Harris: The one that I am excited about, unfortunately, I don't have an update today, but I'm very excited about, is one that I've talked about in the past, that's the MD Anderson, The University of Texas, MIT pilot clinical study, that has people in the study that have the APOE4 gene, which is really the gene that leads to Alzheimer's. It is an adult cognition study that I'm excited to ultimately get the results about and hopefully be able to talk significantly about.

Speaker #1: University of Texas MIT pilot clinical study. That has people in the study that have the APO E4 gene, which is really the gene that leads to Alzheimer's.

Speaker #1: And so it is an adult cognition study that I'm excited to ultimately get the results about and hopefully be able to talk significantly about because if we can from this study see clear evidence that high doses of choline have an impact on the development of dementia and Alzheimer's, that would be really an important finding and an important part of the science behind the cognitive benefits of choline.

Ted Harris: If we can, from this study, see clear evidence that high doses of choline have an impact on the development of dementia and Alzheimer's, that would be really an important finding and an important part of the science behind the cognitive benefits of choline. I do think that that study, once it's published, will lead to another bigger study that will further reinforce those findings. We do know that that study is completed, and we do expect that study should be published in the next couple of months. I'm really hopeful that with the next quarterly update, I will be able to talk about the results of that study. That's an exciting study that's going on that I'm particularly interested in, along with the four that I talked about that were published in the last quarter and the others that are ongoing.

Speaker #1: I do think that that study once it's published will lead to another bigger study that will further reinforce those findings. But we have we do know that that study is completed and we do expect that that study should be published in the next couple of months.

Ted Harris: We do know that that study is completed, and we do expect that study should be published in the next couple of months. I'm really hopeful that with the next quarterly update, I will be able to talk about the results of that study. That's an exciting study that's going on that I'm particularly interested in, along with the four that I talked about that were published in the last quarter and the others that are ongoing.

Speaker #1: So I'm really hopeful that with the next quarterly update, I will be able to talk about the results of that study. So that's an exciting study that's going on that I'm particularly interested in, along with the four that I talked about that were published in the last quarter, and the others that are ongoing.

Speaker #4: Super. All right, thanks so much. I'll jump back in and let others ask questions.

Bob Labick: Super. All right. Thanks so much. I'll jump back in and let others ask questions.

Speaker #1: Thanks, Bob.

Ted Harris: Thanks, Bob.

Speaker #2: Your next question comes from the line of Ramselvaraju with HC Wainwright. Your line is open. Please go ahead.

Operator 3: Your next question comes from the line of Ram Selvaraju with H.C. Wainwright. Your line is open. Please go ahead.

Operator: Your next question comes from the line of Ram Selvaraju with H.C. Wainwright. Your line is open. Please go ahead.

Speaker #5: Thanks so much, and congratulations on it once again—an excellent quarter. I was wondering if you could provide us with some additional granularity regarding how you expect sales and promotional strategies to shift over the course of the remainder of 2026, just based on trends that you're seeing in the market, and which product lines, products, or product initiatives you expect are likely to be most resonant with the consumer base, particularly within the H&H segment.

Ram Selvaraju: Thanks so much. Congratulations on, once again, an excellent quarter. I was wondering if you could provide us with some additional granularity regarding how you expect sales and promotional strategies to shift over the course of the remainder of 2026, just based on trends that you're seeing in the market and product lines, product initiatives that you expect are likely to be most resonant with the consumer base, particularly within the H&H segment. Secondly, on the financial front Martin, maybe you could refresh my memory as to what you expect the effective interest rate to be on the new credit facility funds as and when you draw them, that have the maturity date of 2031. As well as how you expect the effective tax rate to trend over the course of the remainder of 2026. Thank you.

Speaker #5: And then secondly, on the financial front—Martin, maybe you could refresh my memory as to what you expect the effective interest rate to be on the new credit facility funds, as and when you draw them?

Ram Selvaraju: Secondly, on the financial front Martin, maybe you could refresh my memory as to what you expect the effective interest rate to be on the new credit facility funds as and when you draw them, that have the maturity date of 2031. As well as how you expect the effective tax rate to trend over the course of the remainder of 2026. Thank you.

Speaker #5: That have the maturity date of 2031, as well as how you expect the effective tax rate to trend over the course of the remainder of 2026.

Speaker #5: Thank you.

Speaker #1: Thanks, Ron, for your questions and your opening comment—really appreciate it. Obviously, we've been investing significantly in marketing, particularly in the Human Nutrition and Health business over the last few years.

Ted Harris: Thanks, Ram, for your questions and your opening comment. Really appreciate it. Obviously, we've been investing significantly in marketing, particularly in the Human Nutrition & Health business over the last few years. Our goal has been, we have a little internal saying that is, always on, and we've really tried to establish a scalable always on consumer engagement model for all of our branded ingredients over the last few years, really based on combining sort of omni-channel marketing, influencer engagement, consumer PR, and sports partnerships to drive, ultimately, that consumer awareness and market penetration of our products.

Speaker #1: And our goal has been—we have a little internal saying that is "always on." We've really tried to establish a scalable, always-on consumer engagement model for all of our branded ingredients over the last few years.

Ted Harris: Our goal has been, we have a little internal saying that is, always on, and we've really tried to establish a scalable always on consumer engagement model for all of our branded ingredients over the last few years, really based on combining sort of omni-channel marketing, influencer engagement, consumer PR, and sports partnerships to drive, ultimately, that consumer awareness and market penetration of our products.

Speaker #1: We're really focused on combining omnichannel marketing, influencer engagement, consumer PR, and sports partnerships to ultimately drive consumer awareness and market penetration of our products.

Speaker #1: And that effort alone, in just the last year and a half or so, has generated well over a billion consumer impressions, which is a really big number for a company of our size.

Ted Harris: That effort alone, in just the last year and a half or so, has generated well over 1 billion consumer impressions, which is a really big number for a company of our size, across our branded ingredients and really at the end of the day, accelerating our brand awareness and demand generation. Kind of the influencer marketing, you kind of asked how we shift in that. It was certainly invested in certain influencer relationships and changed those over times with shifts in consumer behavior. Certainly, something that is trending more today than it was a couple of years ago is around targeting GLP-1 users for nutrient-rich snacks and meal replacements and so forth.

Speaker #1: Across our branded ingredients, and really, at the end of the day, accelerating our brand awareness and demand generation. And kind of on influencer marketing—you kind of asked how we shift in that.

Speaker #1: We have certainly invested in certain influencer relationships and changed those over time with shifts in consumer behavior. Certainly, something that is trending more today than it was a couple of years ago is targeting GLP-1 users for nutrient-rich snacks and meal replacements, and so forth.

Ted Harris: It was certainly invested in certain influencer relationships and changed those over times with shifts in consumer behavior. Certainly, something that is trending more today than it was a couple of years ago is around targeting GLP-1 users for nutrient-rich snacks and meal replacements and so forth.

Speaker #1: And so, kind of shifting your influencer marketing dollars to target those audiences more, and the followership of the influencers more in line with that targeted audience, is just an example of the shift that we do make.

Ted Harris: Shifting your influencer marketing dollars to target those audiences more and the followership of the influencers more in line with that targeted audience is just an example of the shift that we do make. Sports partnerships as well. We've been kind of all in on soccer or kind of European football of late. World Cup was part of that role. That's kind of a shift in focus and attention of the community. We've been sort of doubling down in our sports partnerships in that area. It is a dynamic investment in marketing and a shift in focus, overall, really a kind of foundational goal of kind of establishing this scalable consumer engagement model via all of those mediums. We're really excited about this addition. Ram, you know us well.

Speaker #1: Sports partnerships as well. I mean, we've been kind of all in on soccer or kind of European football of late. World Cup was part of that role, but that's kind of a shift in focus and attention of the community.

Speaker #1: And so we've been sort of doubling down in our sports partnerships in that area. So it is a dynamic investment in marketing and a shift in focus, but overall, really a kind of foundational goal of establishing this scalable consumer engagement model via all of those mediums.

Ted Harris: It is a dynamic investment in marketing and a shift in focus, overall, really a kind of foundational goal of kind of establishing this scalable consumer engagement model via all of those mediums. We're really excited about this addition. Ram, you know us well. Five, six years ago, we weren't really talking a lot about marketing. I really feel like today we have really one of the leading nutrient marketing teams in the world. It's really helping us drive the type of growth rates that we've been able to achieve over the last couple of years.

Speaker #1: So we're really excited about this edition, Ron. You know us well. Five, six years ago, we weren't really talking a lot about marketing and I really feel like today we have really one of the leading nutrient marketing teams in the world and it's really helping us drive the type of growth rates that we've been able to achieve over the last couple of years.

Ted Harris: Five, six years ago, we weren't really talking a lot about marketing. I really feel like today we have really one of the leading nutrient marketing teams in the world. It's really helping us drive the type of growth rates that we've been able to achieve over the last couple of years.

Speaker #5: Yeah. I think on your questions on interest rate and tax rate, on the interest rate with the amendment and extension of the credit facility, the structure is the same as the past.

Martin Bengtsson: Yeah. I think on your questions on interest rate and tax rate. On the interest rate with the amendment and extension of the credit facility, the structure is the same as the past, there are no significant changes. Obviously, we increased the size of it from $550 million to $650 million in terms of how much we could draw under it. Currently, we have drawn $150 million as of end of Q2. That's sort of what's on the debt on our balance sheet. The rate is variable or floating, as it has been for the last two agreements. It's not a fixed rate, it is a floating rate. It gets reset with SOFR and then we pay a spread based on that.

Speaker #5: So there are no significant changes. Obviously, we increased the size of it from 550 million to 650 in terms of how much we could draw under it.

Speaker #5: Currently, we have drawn $150 million as of the end of Q2. That's what is on the debt on our balance sheet. The rate is variable, or floating, as it has been for the last two agreements.

Martin Bengtsson: Currently, we have drawn $150 million as of end of Q2. That's sort of what's on the debt on our balance sheet. The rate is variable or floating, as it has been for the last two agreements. It's not a fixed rate, it is a floating rate. It gets reset with SOFR and then we pay a spread based on that.

Speaker #5: It's not a fixed rate. It is a floating rate so it gets reset with SOFR and then we pay a spread based on that.

Speaker #5: So at the moment, we're paying sort of around 4.5%, but you can think about it as, should the Fed do a rate hike of 25 basis points, then we will pay 25 basis points more.

Martin Bengtsson: At the moment, we're paying sort of around 4.5%, but you can think about it as should the Fed do a rate hike of 25 basis points, we will pay 25 basis points more. It's a variable rate that we pay. It is worth mentioning that we did improve on the spread that we pay above SOFR with this refinancing. Our pricing improved across the board by 10 basis points and for the higher leverage tiers where we're not in them right now, since we have very low leverage, it improved sort of by 22.5 basis points. It's a better pricing grid for us than the earlier ones, but it will vary with the market interest rates. On the tax rates, we're sort of at 23% year to date effective tax rate. I think we'll be in that 22.5% to 23%.

Speaker #5: So, we kind of—it's a variable rate that we pay. It is worth mentioning that we did improve on the spread that we pay above SOFR with this refinancing.

Speaker #5: So our pricing improved across the board by 10 basis points and for the higher leverage tiers, where we're not in them right now since we have very low leverage, it improved sort of by 22.5 basis points.

Martin Bengtsson: Our pricing improved across the board by 10 basis points and for the higher leverage tiers where we're not in them right now, since we have very low leverage, it improved sort of by 22.5 basis points.

Speaker #5: It's a better pricing grid for us than the earlier ones, but it will vary with the market interest rates. On the tax rate, we're at about a 23% year-to-date effective tax rate.

Martin Bengtsson: It's a better pricing grid for us than the earlier ones, but it will vary with the market interest rates. On the tax rates, we're sort of at 23% year to date effective tax rate. I think we'll be in that 22.5% to 23%. As we wrap up the year is my best guess at the moment. I would put it somewhere there in the 22.5% to 23% effective tax rate.

Speaker #5: I’d say half to 23% as we wrap up the year is my best guess at the moment. So, I would put it somewhere there in the 22.5% to 23% effective tax rate.

Martin Bengtsson: As we wrap up the year is my best guess at the moment. I would put it somewhere there in the 22.5% to 23% effective tax rate.

Speaker #2: Thank you very much.

Ram Selvaraju: Thank you very much.

Speaker #1: Thanks, Ron.

Ted Harris: Thanks, Ram.

Speaker #3: Your next question comes from the line of Daniel Harriman with Sadati and Company. Your line is open. Please go ahead.

Operator 4: Your next question comes from the line of Daniel Harriman with Sidoti & Company. Your line is open. Please go ahead.

Operator: Your next question comes from the line of Daniel Harriman with Sidoti & Company. Your line is open. Please go ahead.

Speaker #4: Hey, good morning, guys. Thanks so much for taking my questions. I've just got a couple today. Thinking more about ANH and Martin, obviously the performance was well above what we were expecting.

Daniel Harriman: Hey, good morning, guys. Thanks so much for taking my questions. I have just got a couple today. Thinking more about ANH and Martin, obviously the performance was well above what we were expecting. Can you help delineate that a little bit between how much of that acceleration was volume versus the pricing actions that you took in April? Then if you would not mind just providing us with more of an update on what is going on in the European monogastric trends. You talked about that last quarter, and it seems like things are really improving over there, so any color you could provide would be great. Thank you.

Daniel Harriman: Good morning, guys. Thanks so much for taking my questions. I have just got a couple today. Thinking more about ANH and Martin, obviously the performance was well above what we were expecting. Can you help delineate that a little bit between how much of that acceleration was volume versus the pricing actions that you took in April?

Speaker #4: Can you help delineate that a little bit, between how much of that acceleration was volume versus the pricing actions that you took in April?

Speaker #4: And then if you wouldn't mind, just providing us with more of an update on what's going on in the European monogastric trends. You talked about that last quarter, and it seems like things are really improving over there.

Daniel Harriman: Then if you would not mind just providing us with more of an update on what is going on in the European monogastric trends. You talked about that last quarter, and it seems like things are really improving over there, so any color you could provide would be great. Thank you.

Speaker #4: So, any color you could provide would be great. Thank you.

Speaker #5: Sure. Yeah. I mean, we're really happy with how ANH has been performing here for the last couple of quarters, right? And getting back to delivering year-over-year quarterly number of quarters.

Martin Bengtsson: Sure. Yeah, we are really happy with how ANH has been performing here for the last couple of quarters, right? Getting back to delivering year-over-year quarterly growth, which we have done for a number of quarters. When it comes to the strong growth, we reported 15% here in Q2. About half of that is volume driven and about half is price driven, directionally. Europe, where we filed for anti-dumping and successfully got that through, and that started as of 1 January or end of December 2025. We have been in that environment for six months now. We have really seen the return of that business. We have seen more volumes coming our way, so we are regaining some of that share that was lost due to the dumping. We have also seen a price recovery. That has improved every quarter.

Speaker #5: When it comes to sort of the strong growth we reported 15% here in the second quarter, and about half of that is volume-driven and about half is price-driven.

Speaker #5: Directionally. And Europe, where we filed for anti-dumping and successfully got that through and that started as of January 1st or end of December of 2025.

Martin Bengtsson: Europe, where we filed for anti-dumping and successfully got that through, and that started as of 1 January or end of December 2025. We have been in that environment for six months now. We have really seen the return of that business. We have seen more volumes coming our way, so we are regaining some of that share that was lost due to the dumping. We have also seen a price recovery. That has improved every quarter.

Speaker #5: So we've been in that environment for six months now. We have really seen the return of that business. We have seen more volumes coming our way.

Speaker #5: So we're regaining some of that share that was lost due to the dumping, and we've also seen a price recovery. That has improved sort of every quarter.

Speaker #5: It started a little bit already in at the end of last year in anticipation of the dumping duties. And it has continued every quarter since.

Martin Bengtsson: It started a little bit already at the end of last year in anticipation of the dumping duties, and has continued every quarter since. I would say it's playing out the way we were hoping for it to play out, because we knew that if we could restore a more level playing field and if people were playing fair, that we would have a really strong offering in the region. It's nice to see that business return. Yeah, it's working very well for us at the moment, and we're pretty excited about what's ahead.

Speaker #5: So, I would say it's playing out the way we were hoping for it to play out, because we knew that if we could restore a more level playing field, and if people were playing fair, that we would have a really strong offering in the region.

Speaker #5: So it's nice to return, so yeah, it's working very well for us at the moment, and we're pretty excited about what's ahead.

Speaker #1: Yeah. Daniel, I just kind of add to Martin's comment. How pleased we are with the continued growth of the ruminant part of the portfolio, which of course is the higher margin, there's more science, more technology in those more similar to what we're doing in the nutrient business in human nutrition and health, trying to create awareness.

Ted Harris: Yeah. Daniel, I'd just add to Martin's comment how pleased we are with the continued growth of the ruminant part of the portfolio, which of course, is the higher margin. There's more science, more technology in those products, and it's a little bit more similar to what we're doing in the nutrient business in Human Nutrition & Health, trying to create awareness. We'll build the science, create awareness, drive market penetration, that business has been growing significantly over the last few years. In the quarter alone, grew about 20%. That growth is almost all volume growth. I think that's really, really exciting to see in that business, driving the ruminant growth to that extent with those products penetrating the market additionally. We really are pleased overall with the performance of ANH and the momentum we have in that business.

Speaker #1: We'll build the science, create awareness, and drive market penetration. That business has been growing significantly over the last few years and, in the quarter alone, grew about 20%.

Ted Harris: We'll build the science, create awareness, drive market penetration, that business has been growing significantly over the last few years. In the quarter alone, grew about 20%. That growth is almost all volume growth. I think that's really, really exciting to see in that business, driving the ruminant growth to that extent with those products penetrating the market additionally. We really are pleased overall with the performance of ANH and the momentum we have in that business.

Speaker #1: And that growth is almost all volume growth. And I think that's really, really exciting to see in that business, driving the mono—I mean, the ruminant growth—to that extent, with those products penetrating the market, too, additionally.

Speaker #1: So we really are pleased overall with the performance of ANH and the momentum we have in that business.

Speaker #4: That's really helpful, guys. Thanks, Martin and Ted. And congrats on the great quarter.

Daniel Harriman: That's really helpful, guys. Thanks, Martin and Ted, congrats on the great quarter.

Speaker #1: Great.

Martin Bengtsson: Great.

Speaker #5: Thank you.

Ted Harris: Thank you. Thanks, Daniel.

Speaker #1: Thanks, Daniel.

Speaker #3: There are no further questions at this time. I will now turn the call back to Ted for closing remarks.

Operator 4: There are no further questions at this time. I will now turn the call back to Ted for closing remarks.

Operator: There are no further questions at this time. I will now turn the call back to Ted for closing remarks.

Speaker #1: Thanks, Tracy. Once again, thank you all very much for joining our call today. We are really pleased with the second quarter results we reported earlier today and the outlook for our company.

Ted Harris: Thanks, Tracy. Once again, thank you all very much for joining our call today. We are really pleased with the Q2 results we reported earlier today and the outlook for our company. We very much appreciate your support as well as your time today, and we look forward to reporting our Q3 2026 results in October. In the meantime, we will be participating in the Wells Fargo Consumer Conference on 23 September in Laguna Beach, California. Nice place to be. Hopefully we'll see some of you there. Thanks again for joining today.

Speaker #1: We very much appreciate your support as well as your time today. We look forward to reporting our Q3 2026 results in October. In the meantime, we will be participating in the Wells Fargo Consumer Conference on September 23 in Laguna Beach, California.

Speaker #1: Nice place to be. So hopefully we'll see some of you there. Thanks again for joining today.

Speaker #3: This concludes today's call. Thank you for attending. You may now disconnect. This event has now concluded. Thank you for joining BALCHEM's second quarter 2026 earnings call.

Operator 4: This concludes today's call. Thank you for attending. You may now disconnect. This event has now concluded. Thank you for joining Balchem's Q2 2026 earnings call. The line will disconnect automatically.

Operator: This concludes today's call. Thank you for attending. You may now disconnect.

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