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Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

This discussion and analysis summarizes the significant factors affecting our consolidated operating results, financial condition, liquidity, and capital resources during the fiscal years ended December 31, 2024 and 2023. Unless otherwise noted, all references herein for the years 2024 and 2023 represent the fiscal years ended December 31, 2024 and 2023, respectively. We intend for this discussion to provide the reader with information that will assist in understanding our financial statements, the changes in certain key items in those financial statements from year to year, and the primary factors that accounted for those changes, as well as how certain accounting principles affect our financial statements. This discussion should be read in conjunction with our consolidated financial statements and notes to the consolidated financial statements included in this Annual Report that have been prepared in accordance with accounting principles generally accepted in the United States of America. This discussion and analysis is presented in five sections:

•Executive Overview

•Results of Operations and Non-GAAP Financial Measures

•Liquidity and Capital Resources

•Material Cash Requirements from Contractual and Other Obligations

•Critical Accounting Policies and Estimates

Executive Overview

Ascent Industries Co. is a diverse industrials company focused on the production of specialty chemicals and stainless steel pipe and tube. Ascent Industries Co. was incorporated in 1958 as the successor to a chemical manufacturing business founded in 1945 known as Blackman Uhler Industries Inc.

The Specialty Chemicals segment produces critical ingredients and process aids for the oil & gas, household, industrial and institutional ("HII"), personal care, coatings, adhesives, sealants and elastomers (CASE), pulp and paper, textile, automotive, agricultural, water treatment, construction and other industries. The Tubular Products segment serves markets through pipe and tube production and customers in the appliance, architectural, automotive and commercial transportation, brewery, chemical, petrochemical, pulp and paper, mining, power generation (including nuclear), water and waste-water treatment, liquid natural gas ("LNG"), food processing, pharmaceutical, oil and gas and other industries.

Fiscal 2024 was a year of stabilization, recapitalization of talent and aggressive self-help to establish a foundation for organic and inorganic growth. The team rallied to overcome soft market conditions across both segments, delivering positive bottom line improvements while establishing a more predictable, reliable and profitable operating model. We ended the year with no outstanding debt, $16.1 million of cash and cash equivalents as well as $47.4 million of remaining available capacity on our revolving line of credit, allowing flexibility to continue to execute our strategy and future growth opportunities.

Munhall Closure

During the second quarter of 2023, the Board of Directors of the Company made the decision to permanently cease operations at Munhall effective on or around August 31, 2023. This strategic decision is part of the Company’s ongoing efforts to consolidate manufacturing to drive an increased focus on its core operations and to improve profitability while driving operational efficiencies. Munhall results are included within discontinued operations in all periods presented.

Divestiture of Specialty Pipe & Tube, Inc.

On December 22, 2023, the Company and its wholly-owned subsidiary Specialty Pipe & Tube, Inc. (“SPT”) entered into an Asset Purchase Agreement pursuant to which Ascent and SPT sold substantially all of the assets primarily related to SPT to Specialty Pipe & Tube Operations, LLC, a Delaware limited liability company. The consideration for the transaction was approximately $55 million of cash proceeds subject to certain closing adjustments. The transaction closed on December 22, 2023. As result of the sale, SPT results of operations are classified under discontinued operations for all periods presented. Prior to the divestiture, SPT was reported under the Company's Tubular Products segment. The discussion and analysis of our results of operations refers to continuing operations unless noted.

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Results of Operations

Comparison of 2024 to 2023 – Continuing Operations

Net sales from continuing operations for the full-year 2024 decreased $15.3 million, or 7.9%, over the full-year 2023 to $177.9 million. The decrease in net sales was primarily driven by an 8.8% decrease in average selling prices coupled with a 0.9% decrease in pounds shipped.

Full-year 2024 gross profit from continuing operations increased 1349.1% to $22.1 million, or 12.4% of sales, compared to $1.5 million, or 0.8% of sales, in the full-year 2023. The increase in dollars and percentage of sales for the full-year 2024 were primarily driven by improved strategic sourcing initiatives and product line management resulting in lower raw material costs.

Selling, general and administrative expense (SG&A) from continuing operations for the full-year 2024 decreased $0.1 million to $26.6 million compared to $26.7 million for the full-year 2023. SG&A as a percentage of sales was 14.9% of sales for 2024 and 13.8% of sales for 2023. The changes in SG&A expense were primarily driven by:

•decreases in salaries, wages and benefits driven by lower headcount in the current year;

•decreases in taxes and licenses; and,

•decreases in other expenses primarily driven by decreases in share-based compensation expense

The full-year decreases were partially offset by:

•increases in incentive bonus driven by higher attainment of performance goals in the current year over the prior year;

•increases in professional fees driven by increased IT and legal expenses in the current year

Operating loss from continuing operations for the full-year 2024 improved to $5.1 million compared to an operating loss of $37.4 million for the full-year 2023. The operating loss decrease for the full-year 2024 was primarily driven by aforementioned increase in gross profit as well as the prior year goodwill impairment not present in the current year.

Comparison of 2024 to 2023 – Specialty Chemicals

Net sales for the Specialty Chemicals segment decreased 3.4%, or $2.9 million, to $80.8 million for 2024 compared to $83.6 million in 2023. The decrease in net sales was primarily driven by a 3.4% decrease in pounds shipped and a 2.6% decrease in average selling prices.

SG&A expense increased by $2.6 million, or 37.0%, to $9.5 million in 2024 compared to $7.0 million in 2023. SG&A as a percentage of sales increased to 11.8% in 2024 from 8.3% in 2023. The changes in SG&A expense were primarily driven by increases in corporate allocation, incentive bonus expense and professional fees, partially offset by decreases in salaries, wages and benefits and taxes and license fees.

Operating income for the full-year 2024 totaled $1.2 million compared to an operating loss of $12.6 million for the full-year 2023. The increase in operating income was primarily driven by improved strategic sourcing initiatives and product line management resulting in lower raw material costs.

The following tables summarize operating results for the two years indicated. Reference should be made to Note 13 to the consolidated financial statements included in Item 8 of this Form 10-K.

(in thousands) Amount % Amount %

Selling, general and administrative expense 9,546 11.8 % 6,966 8.3 %

Acquisition costs and other 477 0.6 % 12 — %

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Comparison of 2024 to 2023 - Tubular Products

Net sales for the Tubular Products segment totaled $97.1 million for the full year of 2024, a decrease of 11.3% compared to the full-year 2023. The decrease in net sales was primarily driven by a 16.8% decrease in average selling prices offset by a 5.5% increase in pounds shipped.

SG&A expense increased $1.2 million, or 16.0%, for the full-year 2024 when compared to 2023. SG&A as a percentage of sales was 9.0% of sales for 2024 and 6.9% of sales for 2023. The changes in SG&A expense were primarily driven by increases in corporate allocation partially offset by decreases in salaries, wages and benefits, taxes and license fees and professional fees.

Operating income for the full-year 2024 totaled $2.6 million compared to an operating loss of $11.2 million for the full-year 2023. The operating income increase for the full-year 2024 was primarily driven by increases in gross profit partially offset by the aforementioned increases in SG&A expenses.

The following table summarizes operating results for the two years indicated. Reference should be made to Note 13 to the consolidated financial statements included in Item 8 of this Form 10-K.

(in thousands) Amount % Amount %

Selling, general and administrative expense 8,743 9.0 % 7,536 6.9 %

Acquisition costs and other 30 0.1 % — — %

Comparison of 2024 to 2023 - Corporate

Corporate expenses decreased $4.1 million to $8.8 million in 2024 down from $12.9 million in 2023. The full-year decrease resulted primarily from allocating corporate expense to locations and decreases in stock compensation expense partially offset by increases in incentive bonus, professional fees, taxes and license expense and insurance expense.

Interest expense was $0.3 million and $4.2 million for the full-years of 2024 and 2023, respectively. The decrease was driven by lower debt outstanding in the current year compared to the prior year. The Company had no debt outstanding as of December 31, 2024.

The Company's effective tax rate for 2024 was less than the U.S. statutory rate of 21% primarily due to discrete tax charges associated with recording a valuation allowance on cumulative US Federal and state deferred tax assets. The Company's effective tax rate for 2023 was less than the U.S. statutory rate of 21% primarily driven by tax benefits associated with non-deductible goodwill impairment.

Non-GAAP Financial Measures

To supplement our consolidated financial statements, which are prepared and presented in accordance with accounting principles generally accepted in the United States ("GAAP"), we use the following non-GAAP financial measures: EBITDA and Adjusted EBITDA. Management believes that these non-GAAP measures are useful because they are key measures used by our management team to evaluate our operating performance, generate future operating plans and make strategic decisions as well as allow readers to compare the financial results between periods. Non-GAAP measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider the Company's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Non-GAAP measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the Company's results or financial condition as reported under GAAP.

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EBITDA and Adjusted EBITDA

We define "EBITDA" as earnings before interest, income taxes, depreciation and amortization. We define "Adjusted EBITDA" as EBITDA further adjusted for the impact of non-cash and other items we do not consider in our evaluation of ongoing performance. These items include: goodwill impairment, asset impairment, gain on lease modification, stock-based compensation, non-cash lease cost, acquisition costs and other fees, shelf registration costs, loss on extinguishment of debt, retention costs and restructuring and severance costs from net (loss) income. We caution investors that amounts presented in accordance with our definitions of EBITDA and Adjusted EBITDA may not be comparable to similar measures disclosed by other companies because not all companies calculate EBITDA and Adjusted EBITDA in the same manner. We present EBITDA and Adjusted EBITDA because we consider them to be important supplemental measures of our performance and investors' understanding of our performance is enhanced by including these non-GAAP financial measures as a reasonable basis for comparing our ongoing results of operations.

Consolidated EBITDA and Adjusted EBITDA from continuing operations are as follows:

Year Ended December 31,

Consolidated

Net loss from continuing operations $ (11,225) $ (34,151)

Adjustments:

Acquisition costs and other 692 856

Goodwill impairment — 11,389

Gain on lease modification (67) —

Stock-based compensation 204 594

Retention expense 3 26

Restructuring and severance costs 208 130

% sales 2.3 % (8.2) %

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Specialty Chemicals EBITDA and Adjusted EBITDA are as follows:

Year Ended December 31,

Specialty Chemicals

Adjustments:

Interest expense 75 74

Acquisition costs and other 477 12

Goodwill impairment — 11,389

Stock-based compensation 7 8

Non-cash lease expense 66 88

Restructuring and severance costs 110 40

Specialty Chemicals Adjusted EBITDA $ 6,332 $ 3,424

% of segment sales 7.8 % 4.1 %

Tubular Products EBITDA and Adjusted EBITDA from continuing operations are as follows:

Year Ended December 31,

Tubular Products

Net income (loss) from continuing operations $ 2,649 $ (11,210)

Adjustments:

Interest expense 1 —

Acquisition costs and other 30 —

Stock-based compensation 10 58

Non-cash lease expense 88 118

Retention expense — 8

Restructuring and severance costs 30 84

Tubular Products Adjusted EBITDA $ 5,652 $ (7,797)

% of segment sales 5.8 % (7.1) %

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Liquidity and Capital Resources

We closely manage our liquidity and capital resources. Our liquidity requirements depend on key variables, including level of investment required to support our business strategies, the performance of our business, capital expenditures, credit facilities and working capital management. Capital expenditures and share repurchases are a component of our cash flow and capital.

Sources of Liquidity

Funds generated by operating activities supplemented by our available cash and cash equivalents and our credit facilities are our most significant sources of liquidity. As of December 31, 2024, we held $16.1 million of cash and cash equivalents, as well as $47.4 million of remaining available capacity on our revolving line of credit. Our existing cash, cash equivalents, and credit facilities balances may fluctuate during 2025. Cash from operations could also be affected by various risks and uncertainties detailed in Item 1A - Risk Factors of this report. We believe our sources of liquidity will be sufficient to fund operations and anticipated capital expenditures as well as repay our debt obligations as they become due over the next 12 months and beyond.

Cash Flows

Cash flows from continuing operations were as follows:

Year ended December 31,

Total cash provided by (used in):

Net increase (decrease) in cash and cash equivalents $ 13,786 $ (69,410)

Operating Activities

The increase in cash provided by operating activities for the year ended December 31, 2024 compared to cash used in operating activities in the year ended December 31, 2023 was primarily driven by changes in working capital. Changes in working capital can vary significantly depending on factors such as the timing of inventory production and purchases, customer payments of accounts receivable and payments to vendors in the regular course of business. Inventory increased operating cash flows for the year ended December 31, 2024 by approximately $11.6 million compared to a decrease of approximately $12.2 million for 2023, while accounts payable decreased operating cash flows by approximately $3.6 million for the year ended December 31, 2024 compared to an increase of approximately $1.6 million for the year ended December 31, 2023. The increase in operating cash flows from inventory is primarily due to lower average inventory and higher inventory turns year over year while the decrease in accounts payable is primarily driven by a decreases in days payables outstanding within our Specialty Chemicals segment. Accounts receivable increased operating cash flow by approximately $2.8 million compared to an increase of $6.8 million driven by lower sales in the current year partially offset by lower days sales outstanding. In addition to the working capital changes, changes in deferred income taxes increased cash flows by approximately $6.2 million compared to cash used in operations of approximately $6.9 million in 2023. This was primarily due to discrete tax charges associated with the recording of a valuation allowance on cumulative U.S. federal and state tax assets in the third quarter of 2024.

Investing Activities

Net cash used in investing activities primarily consists of transactions related to capital expenditures, proceeds from the disposal of property, plant and equipment and acquisitions. The decrease in cash used in investing activities for the full-year 2024 compared to cash used in investing activities for the full-year 2023 was primarily driven by a decrease in capital expenditures in the current year over the prior year.

Financing Activities

Net cash used in financing activities primarily consist of transactions related to our long-term debt. The decrease in net cash used in financing activities for the full-year 2024 compared to the full-year 2023 was primarily due to the repayment of the

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Company's asset backed line of credit and delayed draw term loan in the fourth quarter of 2023 driven by the sale of substantially all of the assets of SPT.

Short-term Debt

The Company has a note payable in the amount of $0.9 million with an annual interest rate of 3.70% maturing April 1, 2024, associated with the financing of the Company's insurance premium in the current year. As of December 31, 2024, the outstanding balance was $0.4 million.

Long-term Debt

On November 6, 2024, Ascent entered into a Limited Consent, Third Amendment to Credit Agreement to Loan Documents with BMO Bank N.A. under Ascent’s credit facility (the “Credit Facility Amendment”). The Credit Facility Amendment reduced the maximum revolving loan commitment under the credit facility from $80 million to $60 million and extended the term of the credit facility through December 31, 2027. The Credit Facility Amendment also increased the interest rate for the credit facility from SOFR plus an interest rate margin of between 1.85% and 2.10% to SOFR plus an interest rate margin of between 1.85% and 2.35%, depending on average availability under the credit facility and Ascent’s consolidated fixed charge coverage ratio.

The Facility contains covenants requiring the maintenance of a minimum consolidated fixed charge coverage ratio if excess availability falls below the greater of (i) $6.0 million and (ii) 15% of the revolving credit facility (currently $9.0 million). As of December 31, 2024, the Company was in compliance with all financial debt covenants.

As of December 31, 2024, the Company had no principal payments outstanding on long-term debt. As of December 31, 2024, the Company had $47.4 million of remaining availability under its credit facility. See Note 6 in the notes to the consolidated financial statements for additional information on the Company's line of credit.

Stock Repurchases and Dividends

We may repurchase common stock and pay dividends from time to time pursuant to programs approved by our Board of Directors. The payment of cash dividends is also subject to customary legal and contractual restrictions. Our capital allocation strategy is to first fund operations and investments in growth and then return excess cash over time to shareholders through share repurchases and dividends.

The Company's previous share repurchase program allowed for repurchase of up to 790,383 shares of the Company's outstanding common stock and expired on February 17, 2025. On February 17, 2025, the Board of Directors authorized a new share repurchase program allowing for repurchase of up to 1.0 million shares of the Company's outstanding common stock over 24 months. The shares will be purchased from time to time at prevailing market prices, through open market or privately negotiated transactions, depending on market conditions. Under the program, the purchases will be funded from available working capital, and the repurchased shares will be returned to the status of authorized, but unissued shares of common stock or held in treasury. There is no guarantee as to the exact number of shares that will be repurchased by the Company, and the Company may discontinue purchases at any time that management determines additional purchases are not warranted. As of December 31, 2024, the Company had 435,608 shares of its previous share repurchase authorization remaining.

Shares repurchased for the year ended December 31, 2024 and 2023 were as follows:

Year ended December 31,

Average price per share $ 10.21 $ 8.97

At the end of each fiscal year, the Board reviews the financial performance and capital needed to support future growth to determine the amount of cash dividend, if any, which is appropriate. In 2024 and 2023, no dividends were declared or paid by the Company.

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Other Financial Measures

Below are additional financial measures that we believe are important in understanding the Company's liquidity position from year to year. The metrics are defined as:

Liquidity Measure:

•Current ratio = current asset divided by current liabilities. The current ratio will be determined by the Company using generally accepted accounting principles, consistently applied.

Profitability Ratio:

•Return on average equity ("ROAE") = net (loss) income divided by the trailing 12-month average of equity. The ROAE will be determined by the Company using generally accepted accounting principles, consistently applied.

Results of these additional financial measures are as follows:

Year ended December 31,

Current ratio 3.8 3.7

Return on average equity (11.3)% (38.6)%

Material Cash Requirements from Contractual and Other Obligations

As of December 31, 2024, our material cash requirements for our known contractual and other obligations were as follows:

•Operating and Finance Leases - The Company enters into various lease agreements for real estate and manufacturing equipment used in the normal course of business. Operating and finance lease obligations were $32.9 million, with $1.8 million payable within 12 months. See Note 7 for further detail of our lease obligations and the timing of expected future payments.

The Company has no off-balance sheet arrangements that are reasonably likely to have a material current or future effect on the Company's financial position, revenues, results of operations, liquidity, or capital expenditures. We expect capital spending in fiscal 2025 to be as much as $7.6 million.

Critical Accounting Policies and Estimates

The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, management evaluates its estimates and judgments based on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Our significant accounting policies are described in Note 1 to the consolidated financial statements included herein. We believe the following accounting policies affect the most significant estimates and management judgments used in the preparation of the Company's consolidated financial statements.

Business Combinations

Description

Business combinations are accounted for using the acquisition method of accounting in accordance with GAAP. Under this method, the total consideration transferred to consummate the business combination is allocated to the identifiable tangible and intangible assets acquired and liabilities assumed based on their respective fair values as of the closing date of the transaction.

Judgments and uncertainties involved in the estimate

The acquisition method of accounting requires extensive use of estimates and judgments to allocate the consideration transferred to the identifiable tangible and intangible assets acquired, if any, and liabilities assumed. Fair value determinations involve significant assumptions about highly subjective variables, including future cash flows, discount rates, and expected business performance. There are also different valuation models and inputs for each component, the selection of which requires considerable judgment. Our estimates and assumptions may be based, in part, on the availability of listed

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market prices or other transparent market data. These determinations will affect the amount of amortization expense recognized in future periods as well the allocation of goodwill, if any, attributable to the transaction.

Effect if actual results differ from assumptions

We base our fair value estimates on assumptions we believe are reasonable, but recognize the assumptions are inherently uncertain. Depending on the size of the purchase price of a particular acquisition, the mix of intangible assets acquired and expected business performance, the purchase price allocation could be materially impacted by applying a different set of assumptions and estimates. Unanticipated events and circumstances may occur which may affect the accuracy or validity of such assumptions, estimates or actual results.

Inventory

Description

Inventory is stated at the lower of cost or net realizable value. Cost is determined by either specific identification or weighted average methods. At the end of each quarter, all facilities review recent sales reports to identify sales price trends that would indicate products or product lines that are being sold below our cost. This would indicate that an adjustment would be required.

We record an obsolete inventory reserve for identified aged inventory items with slow or no sales activity for finished goods or slow or no usage for raw materials for a certain period of time. For those inventory items, a reserve is established for a percentage of the inventory cost less any estimated scrap proceeds and is based on our current knowledge with respect to inventory levels, sales trends and historical experience. During 2024, our reserve decreased approximately $0.1 million to $5.5 million as of December 31, 2024.

We also record an inventory reserve for the estimated shrinkage (quantity losses) between physical inventories. This reserve is based upon the most recent physical inventory results. During 2024, the inventory shrink reserve had a $0.3 million decrease in response to estimated shrinkage rates based on results from previous physical inventories. Our inventory reserve for estimated shrinkage was $0.3 million as of December 31, 2024.

Judgments and uncertainties involved in the estimate

We do not believe that our inventories are subject to significant risk of obsolescence in the near term and we have the ability to adjust purchasing practices based on anticipated sales trends and general economic conditions. However, changes in demand, product life cycle, cost trends, product pricing or a deterioration in product quality could result in the need for additional reserves. Likewise, changes in the estimated shrink reserve may be necessary, based on the timing and results of physical inventories. We also apply judgment in the determination of levels of obsolete inventory and assumptions about net realizable value.

Effect if actual results differ from assumptions

We have not made any material changes in the methodology used to establish our reserves for obsolete inventory or inventory shrinkage during the past two fiscal years. However, it is possible that actual results could differ from recorded reserves. For instance, a 10% change in the amount of products considered obsolete would have decreased net earnings by $0.6 million for 2024. A 10% change in the estimated shrinkage rate would not have had a material impact on net earnings for 2024.

Income Taxes

Description

In determining income for financial statement purposes, we must make certain estimates and judgments in the calculation of tax expense, the resultant tax liabilities and the recoverability of deferred tax assets that arise from temporary differences between the tax and financial statement recognition of revenue and expense. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. In addition, deferred tax assets are also recorded with respect to net operating losses and other tax attribute carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Valuation allowances are established when realization of the benefit of deferred tax assets is not deemed to be more likely than not. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

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We recognize net tax benefits under the recognition and measurement criteria of FASB ASC Topic 740, Income Taxes, which prescribes requirements and other guidance for financial statement recognition and measurement of positions taken or expected to be taken on tax returns. We record interest and penalties, if any, related to uncertain tax positions as a component of income tax expense.

Judgments and uncertainties involved in the estimate

We assess on a tax jurisdictional basis the likelihood that our deferred tax assets can be recovered. If recovery is not expected to exceed a more likely than not (a likelihood of less than 50 percent) threshold, the provision for taxes must be increased by recording a reserve in the form of a valuation allowance for the deferred tax assets that are estimated not to ultimately be recoverable. In this process, certain relevant criteria are evaluated including: the amount of income or loss in prior years, the existence of deferred tax liabilities that can be used to absorb deferred tax assets, the taxable income in prior carryback years that can be used to absorb net operating losses and credit carry backs, future expected taxable income and prudent and feasible tax planning strategies. Changes in taxable income, market conditions, tax laws and other factors may change our judgment regarding whether we will be able to realize the deferred tax assets. These changes, if any, may require material adjustments to the net deferred tax assets and an accompanying reduction or increase in income tax expense which will result in a corresponding increase or decrease in net income in the period when such determinations are made. The utilization of certain deferred tax assets is dependent on the amount and timing of taxable income that we will ultimately generate in the future and other factors, such as changes in tax laws.

We also assess the likelihood that our tax reporting positions will ultimately be sustained. To the extent it is determined it is more likely than not (a likelihood of more than 50 percent) that some portion, or all, of a tax reporting position will ultimately not be recognized and sustained, a provision for unrecognized tax benefit is provided by either reducing the applicable deferred tax asset or accruing an income tax liability. Our judgment regarding the sustainability of our tax reporting positions may change in the future due to changes in tax laws and other factors. These changes, if any, may require material adjustments to the related deferred tax assets or accrued income tax liabilities and an accompanying reduction or increase in income tax expense which will result in a corresponding increase or decrease in net income in the period when such determinations are made.

We have provided valuation allowances as of December 31, 2024, aggregating to $9.1 million, net of federal benefit, against our federal deferred tax assets as well as certain state and local net operating loss carryforwards and other deferred tax assets. As of December 31, 2024, the Company has no liability for unrecognized income tax benefits.

Effect if actual results differ from assumptions

Although management believes that the estimates and judgments discussed herein are reasonable, actual results could differ, which could result in income tax expense or benefits that could be material.

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

The Company is a smaller reporting company as defined in Rule 12b-2 of the Exchange Act and is not required to provide the information required by this Item.

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Item 8. Financial Statements and Supplementary Data

Index to Financial Statements Page

Consolidated Balance Sheets as of December 31, 2024 and 2023 27

Notes to Consolidated Financial Statements 31

Note 1: Summary of Significant Accounting Policies 31

Note 2: Discontinued Operations 37

Note 3: Revenue Recognition 39

Note 4: Fair Value of Financial Instruments 39

Note 5: Property, Plant and Equipment 41

Note 7: Leases 42

Note 8: Accrued Expenses & Other Current Liabilities 44

Note 9: Shareholders' Equity 44

Note 10: Accounting for Share-Based Payments 45

Note 11: Income Taxes 48

Note 12: Earnings Per Share 48

Note 13: Industry Segments 50

Note 14: Benefit Plans and Collective Bargaining Agreements 52

Note 15: Commitments and Contingencies 52

Note 16: Subsequent Events 52

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Report of Independent Registered Public Accounting Firm

Shareholders and Board of Directors

Ascent Industries Co.

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of Ascent Industries Co. (and subsidiaries) (the Company) as of December 31, 2024 and 2023, the related consolidated statements of income (loss), shareholders’ equity, and cash flows for the years then ended, and the related notes and schedule (collectively referred to as the consolidated financial statements). We also have audited the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2024 and 2023, and the consolidated results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, because of the effect of the material weaknesses identified below on the achievement of the objectives of the control criteria, the Company has not maintained effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by COSO.

Basis for Opinions

The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting included in Item 9A. Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures to respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. The following material weaknesses have been identified and included in management’s assessment in Item 9A:

•Information Technology - Management did not design and maintain effective information technology (IT) general controls in the areas of user access, change management, segregation of duties, and cyber-security for systems supporting many of the Company’s key financial reporting processes. As a result, IT application controls and business process controls that are dependent on the ineffective IT general controls, or that rely on data produced

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from systems impacted by the ineffective IT general controls, are also deemed ineffective, which affects substantially all financial statement account balances and disclosures within the Company.

•Inventory - Management did not design and maintain effective controls over inventory.

•Revenue recognition – Management did not design and maintain effective controls over revenue and accounts receivable.

•Period-end financial reporting, journal entries, reconciliations, and account analyses - Management did not design and maintain effective controls to detect potential material misstatements to period-end financial statements through review of account reconciliations and account analyses on a timely basis. Additionally, management did not design and maintain effective controls over the review of journal entries.

•Complex Accounting - Management did not design and maintain management review controls at a sufficient level of precision around complex accounting areas such as income taxes.

We considered the material weaknesses in determining the nature, timing, and extent of audit tests applied in our audit of the Company’s consolidated financial statements as of and for the year ended December 31, 2024, and our opinion on such consolidated financial statements was not affected.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matter

Critical audit matters are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters.

/s/ Moss Adams LLP

Irvine, California

March 4, 2025

We have served as the Company's auditor since 2023.

26

Ascent Industries Co.

Consolidated Balance Sheets

As of December 31, 2024 and 2023

(in thousands, except par value and share data)

Assets

Current assets:

Inventories

Prepaid expenses and other current assets 2,075 4,879

Assets held for sale — 2,912

Current assets of discontinued operations 46 861

Right-of-use assets, operating leases, net 28,225 27,784

Deferred income taxes — 5,808

Liabilities and Shareholders' equity

Current liabilities:

Accrued expenses and other current liabilities 5,042 5,046

Current portion of note payable 369 360

Current portion of operating lease liabilities 1,513 1,140

Current portion of finance lease liabilities 334 292

Current liabilities of discontinued operations 590 1,473

Long-term portion of operating lease liabilities 30,039 29,729

Long-term portion of finance lease liabilities 1,015 1,307

Deferred income taxes 320 —

Other long-term liabilities 51 60

Commitments and contingencies – see Note 15

Shareholders' equity:

Total liabilities and shareholders' equity $ 147,250 $ 163,295

See accompanying notes to consolidated financial statements.

27

Ascent Industries Co.

Consolidated Statements of Income (Loss)

For the years ended December 31, 2024 and 2023

(in thousands, except per share data)

Selling, general and administrative expense 26,586 26,712

Acquisition costs and other 691 855

Goodwill impairment — 11,389

Gain on lease modification (67) —

Operating loss from continuing operations (5,096) (37,430)

Other (income) and expense

Loss from continuing operations before income taxes (5,066) (41,075)

Income tax provision (benefit) 6,159 (6,924)

Loss from continuing operations $ (11,225) $ (34,151)

(Loss) income from discontinued operations, net of tax (2,373) 7,522

Net loss per common share from continuing operations

Net (loss) income per common share from discontinued operations

Net loss per common share

Weighted average number of common shares outstanding:

See accompanying notes to consolidated financial statements.

28

Ascent Industries Co.

Consolidated Statements of Cash Flows

For the years ended December 31, 2024 and 2023

(in thousands)

Cash flows from operating activities:

(Loss) income from discontinued operations, net of tax (2,373) 7,522

Net loss from continuing operations (11,225) (34,151)

Adjustments to reconcile net loss to net cash provided by operating activities:

Amortization of debt issuance costs 105 99

Goodwill impairment — 11,389

Reduction of losses on accounts receivable (118) (180)

Loss on disposal of property, plant and equipment 517 246

Share-based compensation expense 767 1,023

Changes in operating assets and liabilities:

Other assets and liabilities 1,187 515

Accrued expenses (66) (401)

Net cash provided by operating activities - continuing operations 17,007 6,644

Net cash provided by operating activities 14,681 23,078

Cash flows from investing activities:

Purchases of property, plant and equipment (1,892) (2,885)

Net cash used in investing activities - continuing operations (1,892) (2,885)

Net cash provided by investing activities - discontinued operations 2,797 53,386

Net cash provided by investing activities 905 50,501

Cash flows from financing activities:

Proceeds from note payable 914 900

Payments on note payable (906) (928)

Principal payments on finance lease obligations (300) (305)

Repurchase of common stock (1,037) (1,287)

Net cash used in financing activities (1,329) (73,169)

Increase (decrease) in cash and cash equivalents 14,257 410

Cash and cash equivalents, beginning of period 1,851 1,441

Cash and cash equivalents, end of period $ 16,108 $ 1,851

Supplemental Disclosure of Cash Flow Information

Cash paid for:

Income taxes — 864

Noncash Investing Activities:

Capital expenditures, not yet paid $ 267 $ 653

See accompanying notes to consolidated financial statements.

29

Ascent Industries Co.

Consolidated Statements of Shareholders' Equity

For the years ended December 31, 2024 and 2023

(in thousands, except share and per share data)

Common Stock Treasury Stock

Issuance of 77,330 shares of common stock from treasury — — (751) — (77) 751 —

Share-based compensation — — 1,063 — — — 1,063

Issuance of 79,032 shares of common stock from treasury — — (761) — (79) 761 —

Share-based compensation — — 767 — — — 767

See accompanying notes to consolidated financial statements.

30

Ascent Industries Co.

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements

Note 1: Summary of Significant Accounting Policies

Ascent Industries Co. is a diverse industrials company focused on the production of specialty chemicals and stainless steel pipe and tube. Ascent Industries Co. was incorporated in 1958 as the successor to a chemical manufacturing business founded in 1945 known as Blackman Uhler Industries Inc. The Company's executive office is located at 20 N. Martingale Rd, Suite 430, Schaumburg, Illinois 60173. Unless indicated otherwise, the terms "Ascent", "Company," "we" "us," and "our" refer to Ascent Industries Co. and its consolidated subsidiaries.

The Company's business is divided into two reportable operating segments, Specialty Chemicals and Tubular Products. The Specialty Chemicals segment produces critical ingredients and process aids for the oil & gas, household, industrial and institutional ("HII"), personal care, coatings, adhesives, sealants and elastomers (CASE), pulp and paper, textile, automotive, agricultural, water treatment, construction and other industries.

The Tubular Products segment serves markets through pipe and tube production and customers in the appliance, architectural, automotive and commercial transportation, brewery, chemical, petrochemical, pulp and paper, mining, power generation (including nuclear), water and waste-water treatment, liquid natural gas ("LNG"), food processing, pharmaceutical, oil and gas and other industries.

Below are those accounting policies considered by the Company to be significant.

Principles of Consolidation - The consolidated financial statements include the accounts of the Company and its subsidiaries, all of which are wholly-owned. Intercompany transactions and balances have been eliminated.

Use of Estimates - The preparation of the Company's financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates that affect the reported amounts of assets, liabilities, sales and expenses, and related disclosures of contingent assets and liabilities. Significant items subject to such estimates and assumptions include the carrying value of property, plant and equipment; intangible assets; the fair value of assets or liabilities acquired in a business combination; valuation allowances for receivables, inventories and deferred income tax assets and liabilities; environmental liabilities; liabilities for potential tax deficiencies; and, potential litigation claims and settlements. The Company bases these estimates on historical results and various other assumptions believed to be reasonable, all of which form the basis for making estimates concerning the carrying value of assets and liabilities that are readily available from other sources. Actual results may differ from these estimates.

Reclassifications - Certain prior period amounts have been reclassified to conform to current period presentation, including deferred revenue and accrued expenses on the consolidated balance sheets and provision for inventory losses on the statement of cash flows.

Cash and Cash Equivalents - The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. The Company maintains cash levels in bank accounts that, at times, may exceed federally-insured limits.

Accounts Receivable - Accounts receivable from the sale of products are recorded at net realizable value and the Company generally grants credit to customers on an unsecured basis. Substantially all of the Company's accounts receivable are due from companies located throughout the United States. The Company provides an allowance for credit losses for expected uncollectible amounts. The allowance is based upon an analysis of accounts receivable balances with similar risk characteristics on a collective basis, considering factors such as the aging of receivables balances, historical loss experience, current information, and future expectations. Each reporting period, the Company reassesses whether any accounts receivable no longer share similar risk characteristics and should instead be evaluated as part of another pool or on an individual basis. The Company performs periodic credit evaluations of its customers' financial condition and generally does not require collateral. Receivables are generally due within 30 to 60 days. Delinquent receivables are written off based on individual credit evaluations and specific circumstances of the customer.

The opening and closing balances of our accounts receivables from continuing operations are as follows (in thousands):

31

Ascent Industries Co.

Notes to Consolidated Financial Statements

Activity in the allowance for credit losses from continuing operations were as follows:

Balance at beginning of period $ 463 $ 643

Current period provision for expected credit losses 473 953

Deductions from allowance (591) (1,133)

Balance at end of period $ 345 $ 463

Inventories - Inventories are stated at the lower of cost or net realizable value ("LCNRV"). Cost is determined by either specific identification or weighted average methods.

At the end of each quarter, all facilities review recent sales reports to identify sales price trends that would indicate products or product lines that are being sold below our cost. This would indicate that an adjustment would be required. An LCNRV adjustment is recorded when the Company's inventory cost, based upon a historical price, is greater than the current selling price of that product. LCNRV adjustments of $0.5 million and $0.6 million were required by our Specialty Chemicals segment during the years ended December 31, 2024 and 2023, respectively.

Stainless steel, both in its raw material (coil or plate) or finished goods (pipe and tube) state is purchased/sold using a base price plus an additional surcharge which is dependent on current nickel prices. As raw materials are purchased, it is priced to the Company based upon the surcharge at that date. Approximately three months later, the current nickel surcharge is used to determine the proper selling price of the finished pipe for the customer. An LCNRV adjustment is recorded when the Company's inventory cost, based upon a historical nickel price, is greater than the current selling price of that product due to a reduction in the nickel surcharge. LCNRV adjustments of $0.5 million and $0.6 million were required by our Tubular Products segment's continuing operations during the years ended December 31, 2024 and 2023, respectively.

In addition, the Company establishes inventory reserves for:

•Estimated obsolete or unmarketable inventory - The Company identifies aged inventory items with slow or no sales activity for finished goods or slow or no usage for raw materials for a certain period of time. For those inventory items, a reserve is established for a percentage of the inventory cost less any estimated scrap proceed and is based on our current knowledge with respect to inventory levels, sales trends and historical experience. The Company reserved $5.5 million and $5.6 million for continuing operations as of December 31, 2024 and 2023, respectively.

•Estimated quantity losses - The Company performs an annual physical count of inventory during the fourth quarter each year for all facilities. A reserve is established for the potential quantity losses that could occur subsequent to their physical inventory. This reserve is based upon the most recent physical inventory results. The Company had $0.3 million and $0.5 million reserved for physical inventory quantity losses for continuing operations as of December 31, 2024 and 2023, respectively.

Property, Plant and Equipment - Property, plant and equipment are stated at cost. Depreciation is determined based on the straight-line method over the estimated useful life of the assets. Substantially all depreciation is recorded within cost of goods sold on the consolidated statements of income (loss). Leasehold improvements are depreciated over the shorter of their useful lives or the remaining non-cancellable lease term, buildings are depreciated over a range of 10 years to 40 years, and machinery, fixtures and equipment are depreciated over a range of three years to 20 years. The costs of software licenses are amortized over five years using the straight-line method. The Company continually reviews the recoverability of the carrying value of long-lived assets. The Company also reviews long-lived assets for impairment whenever events or changes in circumstances indicate the carrying amount of such assets may not be recoverable. When the future undiscounted cash flows of the operation to which the assets relate do not exceed the carrying value of the asset, the assets are written down to fair value.

Business Combinations - Business combinations are accounted for using the acquisition method of accounting. Under this method, the total consideration transferred to consummate the business combination is allocated to the identifiable tangible and intangible assets acquired and liabilities assumed based on their respective fair values as of the closing date of the transaction. The acquisition method of accounting requires extensive use of estimates and judgments to allocate the consideration transferred to the identifiable tangible and intangible assets acquired, if any, and liabilities assumed.

Goodwill - Goodwill is the excess of the purchase price over the fair value of identifiable assets acquired, less fair value of liabilities assumed, in a business combination. The Company reviews goodwill for impairment at the reporting unit level,

32

Ascent Industries Co.

Notes to Consolidated Financial Statements

which is the operating segment level or one level below the operating segment level. Goodwill is not amortized but is evaluated for impairment at least annually on October 1 or whenever events or changes in circumstances indicate that it is more likely than not that the carrying amount may not be recoverable. The evaluation begins with a qualitative assessment to determine whether a quantitative impairment test is necessary. If, after assessing qualitative factors, we determine it is more likely than not that the fair value of the reporting unit is less than the carrying amount, then the quantitative goodwill impairment test is performed. The quantitative goodwill impairment test used to identify potential impairment compares the fair value of a reporting unit with its carrying amount, including goodwill. Fair value represents the price a market participant would be willing to pay in a potential sale of the reporting unit and is based on a combination of an income approach, based on discounted future cash flows, and a market approach, based on market multiples applied to free cash flow. If the fair value exceeds the carrying value, then no goodwill impairment has occurred. If the carrying value of the reporting unit exceeds its fair value, an impairment loss is recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. Any impairment identified is included within "goodwill impairment" in the consolidated statements of income (loss).

A reporting unit is an operating segment or a business unit one level below that operating segment, for which discrete financial information is prepared and regularly reviewed by segment management. The company had no goodwill as of December 31, 2024 and 2023, respectively.

The changes in the carrying amount of goodwill for the years ended December 31, 2023 were as follows:

(in thousands) Specialty Chemicals

Goodwill Impairment (11,389)

During the third quarter of 2023, the Company determined potential indicators of impairment within the Specialty Chemicals reporting unit, with an associated goodwill balance of $11.4 million existed. Macroeconomic conditions and pressures, increased risks within the broader specialty chemicals business, reporting unit operating losses and a decline in the reporting unit's net sales compared to forecast, collectively, indicated that the reporting unit had experienced a triggering event and the need to perform a quantitative evaluation of goodwill. The Company performed a discounted cash flow analysis and a market multiple analysis for the Specialty Chemicals reporting unit to determine the reporting unit's fair value. The discounted cash flow analysis included management assumptions for expected sales growth, capital expenditures and overall operational forecasts while the market multiple analysis included historical and projected performance, market capitalization, volatility and multiples for industry peers. Determining the fair value of the reporting unit and allocation of that fair value to individual assets and liabilities within the reporting unit to determine the implied fair value of the goodwill is judgmental in nature and requires the use of significant management estimates and assumptions. Any changes in the judgments, estimates, or assumptions could produce significantly different results. As a result of the goodwill impairment evaluation, it was concluded that the estimated fair value of the Specialty Chemicals reporting unit was below its carrying value by 27.6% resulting in a goodwill impairment charge of $11.4 million for the year ended December 31, 2023.

Intangible Assets - Intangible assets consists of customer relationships, trademarks and trade names, and represents the fair value of intellectual, non-physical assets resulting from business acquisitions and are amortized over their estimated useful lives using either an accelerated or straight-line method over a period of 15 years. Amortization expense is recorded in selling, general and administrative expense on the consolidated statements of income (loss).

The gross carrying amount and accumulated amortization of intangible assets from continuing operations consist of the following:

Definite-lived intangible assets:

33

Ascent Industries Co.

Notes to Consolidated Financial Statements

The Company recorded amortization expense related to intangible assets from continuing operations of $1.5 million for 2024 and 2023, respectively.

Estimated amortization expense for the next five fiscal years based on existing intangible assets is as follows:

(in thousands)

Deferred Charges - Deferred charges represent debt issuance costs and are amortized over their estimated useful lives using the straight-line method over a period of four years and is recorded in interest expense on the consolidated statements of income (loss). In the fourth quarter of 2024, the Company capitalized $0.3 million of debt issuance costs related to is Credit Facility Amendment with BMO Bank N.A. Debt issuance costs remaining related to the Company's previous credit agreement were expensed in the fourth quarter of 2024. See Note 6 for additional information on the Company's credit facilities.

Deferred charges totaled $0.3 million and $0.4 million as of December 31, 2024 and 2023, respectively. Accumulated amortization of deferred charges as of December 31, 2024 and 2023 totaled less than $0.1 million and $0.3 million, respectively.

The Company recorded amortization expense related to deferred charges of $0.1 million for 2024 and 2023.

Long-Lived Asset Impairment - The carrying amounts of long-lived assets are reviewed whenever certain events or changes in circumstances indicate that the carrying amounts may not be recoverable. A potential impairment has occurred for long-lived assets held-for-use if projected future undiscounted cash flows expected to result from the use and eventual disposition of the assets are less than the carrying amounts of the assets. An impairment loss is recorded for long-lived assets held-for-use when the carrying amount of the asset is not recoverable and exceeds its fair value.

Long-lived assets that are expected to be sold within the next 12 months and meet the other relevant held-for-sale criteria are classified as long-lived assets held-for-sale. An impairment loss is recorded for long-lived assets held-for-sale when the carrying amount of the asset exceeds its fair value less cost to sell. A long-lived asset is not depreciated while its classified as held-for-sale.

For long-lived assets to be abandoned, the Company considers the asset to be disposed of when it ceases to be used. Until it ceases to be used, the Company continues to classify the asset as held-for-use and test for potential impairment accordingly. If the Company commits to a plan to abandon a long-lived asset before the end of its previously estimated useful life, its depreciable life is re-evaluated.

Gains and losses on the disposal of assets are recorded as the difference between the net proceeds received, if any, and net carrying values of the assets disposed and are included in loss on disposal of assets and adjustments to assets held for sale, net in the consolidated statements of income (loss).

Fair value measurements associated with long-lived asset impairments are included in Note 4 of the notes to the consolidated financial statements.

Assets Held for Sale - The Company classifies long-lived assets or disposal groups as held for sale in the period when all of the following conditions have been met:

•the Board of Directors have approved and committed to a plan to sell the assets or disposal group;

•the asset or disposal group is available for immediate sale in its present condition;

•an active program to locate a buyer and other actions required to complete the sale have been initiated;

34

Ascent Industries Co.

Notes to Consolidated Financial Statements

•the sale of the asset or disposal group is probable and expected to be completed within one year;

•the asset or disposal group is being actively marketed for sale at a price that is reasonable in relation to its current fair value; and,

•it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn.

We initially measure a long-lived asset or disposal group that is classified as held for sale at the lower of its carrying value or fair value less any costs to sell and recognize any loss in the period in which the held for sale criteria are met. Gains are not recognized until the date of sale. We cease depreciation and amortization of a long-lived asset, or assets within a disposal group, upon their designation as held for sale and subsequently assess fair value less any costs to sell at each reporting period until the asset or disposal group is no longer classified as held for sale. See Note 4 for discussion on the Company's assets held for sale.

Discontinued Operations - The Company accounts for and classifies a business as a discontinued operation when the following criteria are met: the disposal group is a component of an entity, the component of the entity meets the held for sale criteria in accordance with our policy described above and the component of the entity represents a strategic shift in the entity's operating and financial results. See Note 2 for discussion on the Company's discontinued operations.

Leases - The Company determines whether an arrangement is a lease at contract inception. For leases in which the Company is the lessee, the Company recognizes a right-of-use asset and corresponding lease liability on the consolidated balance sheets equal to the present value of the fixed lease payments over the lease term. Lease liabilities represent an obligation to make lease payments arising from a lease while right-of-use assets represent a right to use an underlying asset during the lease term. The Company does not separate lease and non-lease components for its underlying assets. Leases with an initial term of 12 months or less are not recorded on the consolidated balance sheets.

If readily determinable, the rate implicit in the lease is used to discount lease payments to present value; however, the Company's leases generally do not provide a readily determinable implicit rate. When the implicit rate is not determinable, the Company's estimated incremental borrowing rate is utilized, determined on a fully collateralized and fully amortizing basis, to discount lease payments based on information available at lease commencement. The Company determines the appropriate incremental borrowing rate by identifying a reference rate and making adjustments that take into consideration financing options and certain lease-specific circumstances. Lease costs are recognized on a straight-line basis over the lease term.

Right-of-use assets and operating lease liabilities are remeasured upon certain modifications to leases using the present value of the remaining lease payments and estimated incremental borrowing rate upon lease modification. The difference between the remeasured right-of-use asset and the operating lease liabilities are recognized as a gain or loss within operating expenses. The Company reviews any changes to its lease agreements for potential modifications and/or indicators of impairment of the respective right-of-use asset. Operating leases are included in right-of-use assets, current portion of operating lease liabilities and long-term portion of operating lease liabilities on the accompanying consolidated balance sheets. Finance leases are included in property, plant and equipment, current portion of finance lease liabilities and long-term portion of finance lease liabilities. See Note 7 for additional information on the Company's leases.

The Company subleases portions of certain properties that are not used in its operations. Sublease income was $0.4 million for 2024 and 2023, respectively.

Deferred Revenue – Deferred revenue includes advance payments and deposits from customers prior to the completion of a performance obligation. Deferred revenue is classified as current based on our production cycle and reported on a sales order-by-sales order basis, net of revenue recognized, at the end of each reporting period. As of December 31, 2024 , the Company's deferred revenue balance was $1.4 million.

Deferred revenue activity from continuing operations were as follows:

Balance at beginning of period $ 62 $ 98

Current period advances from customers 2,303 1,395

Revenue recognized due to fulfillment of performance obligations (1,005) (1,431)

Balance at end of period $ 1,360 $ 62

35

Ascent Industries Co.

Notes to Consolidated Financial Statements

Revenue Recognition - Revenues are recognized when control of the promised goods or services is transferred to our customers upon shipment, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. The Company's revenues are derived from contracts with customers where performance obligations are satisfied at a point-in-time or over-time. For certain contracts under which the Company produces product with no alternative use and for which the Company has an enforceable right to payment during the production cycle, product in which the material is customer owned or in which the customer simultaneously consumes the benefits throughout the production cycle, progress toward satisfying the performance obligation is measured using an output method of units produced. Certain customer arrangements consist of bill-and-hold characteristics under which transfer of control has been met (including the passing of title and significant risk and reward of ownership to the customers). Therefore, the customers can direct the use of the bill-and-hold inventory while we retain physical possession of the product until it is shipped to a customer at a point in time in the future.

Our contracts with customers may include multiple performance obligations. For such arrangements, revenue for each performance obligation is based on its standalone selling price and revenue is recognized as each performance obligation is satisfied. The Company generally determines standalone selling prices based on the prices charged to customers using the adjusted market assessment approach or expected cost plus margin. Deferred revenues are recorded when cash payments are received in advance of satisfying the performance obligation, including amounts which are refundable. See Note 3 for additional information on the Company's revenue.

Shipping Costs - Shipping costs are treated as fulfillment activities at the time control and title of the promised good and services rendered are transferred to the customer. Shipping costs from continuing operations of approximately $3.7 million and $3.4 million in 2024 and 2023, respectively, are recorded in cost of goods sold on the consolidated statements of income (loss).

Share-Based Compensation - Share-based payments to employees, including grants of employee stock options, are recognized in the consolidated statements of income (loss) as compensation expense (based on their estimated fair values at grant date) generally over the vesting period of the awards using the straight-line method. Any forfeitures of share-based awards are recorded as they occur. See Note 10 for additional information on the Company's accounting for share-based payments.

Income Taxes - Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing accounts and their respective tax basis and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recorded to reduce the carrying amounts of deferred tax assets unless it is more likely than not that such assets will be realized.

Additionally, the Company maintains reserves for uncertain tax provisions, if necessary. See Note 11 for additional information on the Company's income taxes.

Earnings Per Share - Earnings per share of common stock are computed based on the weighted average number of basic and diluted shares outstanding during each period. See Note 12 for additional information on the Company's earnings per share.

Concentrations of Credit Risk - Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash deposits and trade accounts receivable. The Company monitors the financial institutions where it invests its cash and cash equivalents as well as performs credit reviews of potential customers when extending credit to purchase and periodic reviews of existing customers to mitigate exposure and risk. The Specialty Chemicals segment has one customer that accounted for approximately 12% of the segment's revenues for 2024 and 24% of the segment's revenues for 2023. The Tubular Products segment has one customer that accounted for approximately 18% and 17% of the segment's revenues for 2024 and 2023.

Accounting Pronouncements Recently Adopted - In December 2024, the Company adopted Accounting Standards Update (ASU) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The ASU expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets. All disclosure requirements under ASU 2023-07 are also required for public entities with a single reportable segment. The adoption of this standard by the Company did not have a material effect on the consolidated financial statements or footnote disclosures.

36

Ascent Industries Co.

Notes to Consolidated Financial Statements

Accounting Pronouncements Not Yet Adopted - In December 2023, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The ASU requires consistent categories and greater disaggregation of information in the rate reconciliation and income taxes paid disaggregated by jurisdiction. The amendments also require that all entities disclose more detailed information about income taxes paid, including by jurisdiction; pretax income (or loss) from continuing operations; and income tax expense (or benefit). The ASU is effective for the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, and subsequent interim periods, with early adoption permitted. The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and footnote disclosures.

In November 2024, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures. The ASU requires updated disclosures, in the notes to the financial statements, of specified information about certain costs and expenses. The amendments require that at each interim and annual reporting period an entity disclose the amounts of purchases of inventory, employee compensation, depreciation, intangible asset amortization and depreciation, depletion, and amortization recognized as part of oil and gas producing activities included in relevant expense captions. The amendments also require disclosure of qualitative descriptions of amounts remaining in relevant expense captions that are not separately disaggregated and to disclose the total amount of selling expenses as well as the entity's definition of selling expenses. The ASU is effective for the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2027, and subsequent interim periods, with early adoption permitted. The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and footnote disclosures

Recent accounting pronouncements pending adoption not discussed in this Form 10-K are either not applicable to the Company or are not expected to have a material impact on the Company.

Note 2: Discontinued Operations

Munhall Closure

During the second quarter of 2023, the Board of Directors of the Company made the decision to permanently cease operations at Munhall effective on or around August 31, 2023. The strategic decision to cease manufacturing operations at Munhall is part of the Company’s ongoing efforts to consolidate manufacturing to drive an increased focus on its core operations and to improve profitability while driving operational efficiencies.

As a result of this decision, during the second quarter of 2023, the Company incurred asset impairment charges of $6.4 million related to the write down of inventory and long-lived assets as well as $1.4 million in increased reserves on accounts receivable at the facility. During the third quarter of 2023, the Company incurred additional asset impairment charges of $2.4 million related to the write down of inventory to net realizable value. During the first quarter of 2024, the Company incurred additional asset impairment charges of $1.1 million related to the write down of the remaining long-lived assets at the facility. During the third quarter of 2024, the Company entered into a purchase agreement to sell the remaining assets at the Munhall facility for approximately $2.8 million. The Company recognized a $1.5 million gain on the sale in the third quarter of 2024. See Note 4 for further discussion of the assets held for sale and related fair value measurements. The results of operations for Munhall have been classified as discontinued operations for all periods presented.

In May of 2023, the Company was named as a defendant in a lawsuit filed in the U.S. District Court for the Western District of Pennsylvania, asserting various claims for breach of contracts resulting in losses to the plaintiff and seeking damages in the amount of $0.8 million plus prejudgment interest and attorney's fees. The Company had an estimated liability of $1.0 million related to the lawsuit as of December 31, 2023. In August of 2024, the Company resolved the case through a settlement agreement and no longer has funds reserved for the matter.

In August of 2023, the Company was named as a defendant in a lawsuit filed with the Court of Common Pleas for Delaware County, Ohio, asserting various claims for breach of contracts resulting in losses to the plaintiff and seeking damages in the amount of $0.7 million plus prejudgment interest and attorney's fees. In December 2024, the Company entered into mediation with the plaintiff subject to negotiation of a mutually agreeable settlement. As such, the Company recorded an estimated liability of $0.4 million related to the lawsuit as of December 31, 2024.

37

Ascent Industries Co.

Notes to Consolidated Financial Statements

Divestiture of Specialty Pipe & Tube, Inc.

On December 22, 2023, the Company and its wholly-owned subsidiary Specialty Pipe & Tube, Inc. (“SPT”) entered into an Asset Purchase Agreement pursuant to which Ascent and SPT sold substantially all of the assets primarily related to SPT to Specialty Pipe & Tube Operations, LLC, a Delaware limited liability company. The consideration for the transaction was approximately $55 million of cash proceeds subject to certain closing adjustments. The transaction closed on December 22, 2023. Ascent and Purchaser also entered into a Transition Services Agreement (the “TSA”) and an Employee Leasing Agreement (the “ELA”) each dated December 22, 2023, pursuant to which Ascent agreed to provide certain transition services and to lease certain employees to Purchaser immediately after the closing for certain agreed upon transition periods. The TSA and the ELA were both completed as of June 30, 2024. As a result of the sale, SPT results of operations are classified under discontinued operations for all periods presented. Prior to the divestiture, SPT was reported under the Company's Tubular Products segment.

The following table presents the aggregate carrying amounts of the classes of assets and liabilities of the Company's discontinued operations:

Carrying amounts of assets included as part of discontinued operations:

Accounts receivable, net — 778

Prepaid expenses and other current assets 46 83

Current assets classified as discontinued operations 46 861

Total assets classified as discontinued operations $ 46 $ 861

Accounts payable $ 16 $ 107

Accrued expenses and other current liabilities 575 1,366

Total current liabilities classified as discontinued operations $ 591 $ 1,473

Total liabilities classified as discontinued operations $ 591 $ 1,473

The financial results of the Company's discontinued operations are presented as income from discontinued operations, net of tax on the consolidated statements of income (loss). The following table summarizes the results of the Company's discontinued operations:

(Unaudited)

Three months ended December 31, Year Ended December 31,

Loss on classification as held for sale — — — 83

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Ascent Industries Co.

Notes to Consolidated Financial Statements

Note 3: Revenue Recognition

Revenue is generated primarily from contracts to produce, ship and deliver steel and specialty chemical products. The Company’s performance obligations are satisfied and revenue is recognized when control and title of the contract promised goods or services is transferred to our customers for product shipped or services rendered. Sales tax and other taxes we collect with revenue-producing activities are excluded from revenue. Shipping costs charged to customers are treated as fulfillment activities and are recorded in both revenue and cost of sales at the time control is transferred to the customer. Costs related to obtaining sales contracts are incidental and are expensed when incurred. Because customers are invoiced at the time title transfers and the Company’s right to consideration is unconditional at that time, the Company does not maintain contract asset balances. Deferred revenues are recorded when cash payments are received in advance of satisfying the performance obligation, including amounts which are refundable. As of December 31, 2024 , the Company's deferred revenue balance was $1.4 million. See Note 1 for additional information of the Company's deferred revenue. The Company offers industry standard payment terms.

The following table presents the Company's revenues, disaggregated by product group from continuing operations:

Fiberglass and steel liquid storage tanks and separation equipment $ — $ 50

The Company's revenues are derived from contracts with customers where performance obligations are satisfied at a point-in-time or over-time. Performance obligations are supported by contracts with customers, providing a framework for the nature of the distinct goods, services or bundle of goods and services. The timing of satisfying the performance obligation is typically indicated by the terms of the contract. The following table represents the Company's revenue recognized at a point- in-time and over-time.

Note 4: Fair Value of Financial Instruments

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. To measure fair value, we use a three-tier valuation hierarchy based upon observable and non-observable inputs:

Level 1 - Unadjusted quoted prices that are available in active markets for identical assets or liabilities at the measurement date.

Level 2 - Significant other observable inputs available at the measurement date, other than quoted prices included in Level 1, either directly or indirectly, including:

•Quoted prices for similar assets or liabilities in active markets;

•Quoted prices for identical or similar assets or liabilities in non-active markets;

•Inputs other than quoted prices that are observable for the asset or liability; and

•Inputs that are derived principally from or corroborated by other observable market data.

Level 3 - Significant unobservable inputs that cannot be corroborated by observable market data and reflect the use of significant management judgment. These values are generally determined using model-based techniques, including option pricing models, discounted cash flow models, probability weighted models, and Monte Carlo simulations.

The Company's financial instruments include cash and cash equivalents, accounts receivable, accounts payable, notes payable, earn-out liabilities, revolving line of credit, and long-term debt.

39

Ascent Industries Co.

Notes to Consolidated Financial Statements

Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis

For the fiscal year ended December 31, 2024 and 2023, the Company's only significant measurements of assets and liabilities at fair value on a non-recurring basis subsequent to their initial recognition were certain long-lived assets, certain assets held for sale and goodwill (see Note 1 to the consolidated financial statements for additional information regarding this Level 3 fair value measurement).

Long-lived assets

The Company reviews the carrying amounts of long-lived assets whenever certain events or changes in circumstances indicate that the carrying amounts may not be recoverable. The Company assesses performance quarterly against historical patterns, projections of future profitability, and whether it is more likely than not that the assets will be disposed of significantly prior to the end of their estimated useful life for evidence of possible impairment. An impairment loss is recognized when the carrying amount of the asset (disposal) group is not recoverable and exceeds fair value. The Company estimates the fair values of assets subject to long-lived asset impairment based on the Company's own judgments about the assumptions market participants would use in pricing the assets and observable market data, when available.

During the second quarter of 2023, the Board of Directors of the Company made the decision to permanently cease operations at the Munhall facility. The Company ceased operations effective August 31, 2023. As a result of this decision, it was determined to be more likely than not that the assets of Munhall would be sold or otherwise disposed of significantly before the end of their previously estimated useful lives, and therefore, experienced a triggering event and were evaluated for recoverability. Based on this evaluation, inventory at Munhall was written down to its net realizable value of $16.0 million and certain long-lived assets, including intangible assets, were written down to their estimated fair value of $2.6 million, resulting in asset impairment charges of $6.4 million in the second quarter of 2023.

During the third quarter of 2023, the remaining inventory at Munhall was written down to its net realizable value of $4.0 million resulting in asset impairment charges of $2.4 million in the third quarter of 2023. During the first quarter of 2024, the Company incurred additional asset impairment charges of $1.1 million related to the write down of the remaining long-lived assets at the facility. See Note 2 for further information on the Company's discontinued operations.

Assets Held-for-Sale

During the third quarter of 2024, the Company entered into a purchase agreement to sell the remaining assets at the Munhall facility for approximately $2.8 million. The Company recognized a $1.5 million gain on the sale in the third quarter of 2024. The Company remains obligated under the terms of the Master Lease for the rent and other costs that may be associated with the lease of the Munhall facility through 2036.

The Company's assets classified as held for sale as are as follows:

Property, plant and equipment, net — 2,374

Other assets, net — 538

Assets held for sale $ — $ 2,912

Fair Value of Financial Instruments

The fair values of cash and cash equivalents, accounts receivable, accounts payable and the Company's note payable approximated their carrying value because of the short-term nature of these instruments. The Company's revolving line of credit and long-term debt, which is based on a variable interest rate, are also reflected in the financial statements at carrying value which approximates fair value as of December 31, 2024. The carrying amount of cash and cash equivalents are considered Level 1 measurements. The carrying amounts of accounts receivable, accounts payable, note payable, revolving line of credit and long-term debt are considered Level 2 measurements. See Note 6 for further information on the Company's debt.

40

Ascent Industries Co.

Notes to Consolidated Financial Statements

Note 5: Property, Plant and Equipment

Property, plant and equipment consist of the following:

Less accumulated depreciation and amortization (73,500) (70,669)

Property, plant and equipment, net $ 25,462 $ 29,755

The following table sets forth depreciation expense related to property, plant and equipment:

Selling, general and administrative 260 243

Note 6: Debt

Short-term debt

On June 21, 2024, the Company entered into a note payable in the amount of $0.9 million with an interest rate of 3.70% maturing April 1, 2025. The agreement is associated with the financing of the Company's insurance premium in the current year. As of December 31, 2024, the outstanding balance was $0.4 million.

Credit Facilities

On November 6, 2024, Ascent entered into a Limited Consent, Third Amendment to Credit Agreement to Loan Documents with BMO Bank N.A. under Ascent’s credit facility (the “Credit Facility Amendment”). The Credit Facility Amendment reduced the maximum revolving loan commitment under the credit facility from $80 million to $60 million and extended the term of the credit facility through December 31, 2027. The Credit Facility Amendment also increased the interest rate for the credit facility from SOFR plus an interest rate margin of between 1.85% and 2.10% to SOFR plus an interest rate margin of between 1.85% and 2.35%, depending on average availability under the credit facility and Ascent’s consolidated fixed charge coverage ratio.

We have pledged all of our accounts receivable, inventory, and certain machinery and equipment as collateral for the Credit Agreement. Availability under the Credit Agreement is subject to the amount of eligible collateral as determined by the lenders' borrowing base calculations. Amounts outstanding under the revolving line of credit currently bear interest at (a) the Base Rate (as defined in the Credit Agreement) plus 0.75%, or (b) SOFR plus 1.75%. The Credit Agreement also provides an unused commitment fee based on the daily used portion of the credit facility.

Pursuant to the Credit Facility Amendment, the Company was required to pledge all of its tangible and intangible properties, including the stock and membership interests of its subsidiaries. The Credit Facility Amendment contains covenants requiring the maintenance of a minimum consolidated fixed charge coverage ratio if excess availability falls below the greater of (i) $6.0 million and (ii) 15% of the revolving credit facility. The borrowing capacity under the amended credit facility totals $60.0 million consisting of a $60.0 million revolving line of credit which includes a $7.6 million machinery and equipment sub-limit.

The revolving line of credit interest rate was 0.35% and 6.20% as of December 31, 2024 and 2023, respectively. The interest rate in 2024 consisted solely of the Company's unused commitment fee under the Credit Facility Amendment. The Company

41

Ascent Industries Co.

Notes to Consolidated Financial Statements

had no average borrowings under the revolving line of credit during 2024. The Company had $55.6 million of average borrowings under the revolving line of credit with a weighted average interest rate of 7.22% in 2023.

The Company made interest payments on all credit facilities of $0.3 million and 4.0 million in 2024 and 2023, respectively.

As of December 31, 2024, the Company has no principal payments outstanding on long-term debt.

As of December 31, 2024, the Company had $47.4 million of remaining availability under it credit facility.

Note 7: Leases

The Company's portfolio of leases contains both finance and operating leases that relate to real estate and manufacturing equipment. Substantially all of the value of the Company's leased plants and facilities relate to the Master Lease with Store Master Funding XII, LLC (“Store”), an affiliate of Store Capital Corporation ("Store Capital"), that was entered into in 2016 and since amended, with the latest amendment occurring in 2024. During the third quarter of 2024, the Company and Store closed on a transaction pursuant to which Store sold to a third party approximately 20,200 square feet of warehouse space located at Ascent’s facility in Cleveland, Tennessee. As a result of the sale, the Company and Store entered into a Fourth Amended and Restated Master Lease Agreement (the “Fourth Master Lease”) to reduce the Company's rent at the Cleveland facility pursuant to the terms and conditions of the Third Amended and Restated Master Lease Agreement between the parties dated September 10, 2020. The Fourth Master Lease was determined to be a lease modification that qualified for a remeasurement of the existing lease and not a separate contract. Upon modification of the Fourth Master Lease, the right-of-use asset and operating lease liability were remeasured using an incremental borrowing rate determined on the date of modification. As such, the Company recognized an increase in the right-of-use asset and operating lease liability related to the Fourth Master Lease of $1.3 million and recognized a gain on the modification of $0.1 million, which is reported within operating expenses on the consolidated statements of income (loss).

As of December 31, 2024, operating lease liabilities related to the master lease agreement with Store Capital totaled $30.9 million, or 94% of the total lease liabilities on the consolidated balance sheet.

During the year ended December 31, 2024, the Company entered into new operating lease agreements resulting in an additional $0.5 million of right-of-use assets and lease liabilities.

Balance Sheet Presentation

Operating and finance lease amounts from continuing operations are as follows (in thousands):

Year Ended December 31,

Classification Financial Statement Line Item 2024 2023

Operating lease assets Right-of-use assets, operating leases $ 28,225 $ 27,784

Finance lease assets Property, plant and equipment, net 1,267 1,543

Current liabilities Current portion of lease liabilities, finance leases 334 292

42

Ascent Industries Co.

Notes to Consolidated Financial Statements

Total Lease Cost

Individual components of the total lease cost incurred by the Company are as follows:

Year Ended December 31,

Finance lease cost:

Reduction in carrying amount of right-of-use assets 322 334

Interest on finance lease liabilities 86 85

1Includes short term leases, which are immaterial

Reduction in carrying amounts of right-of-use assets held under finance leases is included in depreciation expense. Minimum rental payments under operating leases are recognized on a straight-line method over the term of the lease including any periods of free rent and are included in selling, general, and administrative expense on the consolidated statements of income (loss).

Maturity of Leases

The amounts of undiscounted future minimum lease payments under leases as of December 31, 2024 are as follows:

(in thousands) Operating Finance

Total undiscounted minimum future lease payments 47,113 1,513

Lease Term and Discount Rate

Year Ended December 31,

Weighted-average discount rate

Weighted-average remaining lease term

Finance leases 4.03 years 5.07 years

Subleases

During the second quarter of 2024, the Company entered into a sublease agreement with a third party to sublease the former Specialty Pipe and Tube, Inc. facilities in Mineral Ridge, Ohio and Houston, Texas. The sublease agreement continues through the remaining term of the Master Lease Agreement and will expire on September 30, 2036, unless terminated in accordance with the sublease agreement. The sublease provides for an annual base rent of approximately $0.1 million in the first year, which increases on an annual basis by 2.0%. The sublessee is responsible for taxes and all operating expenses related to the subleased space

43

Ascent Industries Co.

Notes to Consolidated Financial Statements

The Company also currently subleases the former Palmer facility and records cash receipts related to the subleases in other expense (income) on the consolidated statements of income (loss). Sublease payments fully offset the amounts the Company incurs in the Master Lease related to sublet facilities.

Future expected cash receipts from the Company's subleases as of December 31, 2024 are as follows:

(in thousands) Sublease Receipts

Total sublease receipts $ 7,629

Note 8: Accrued Expenses & Other Current Liabilities

Accrued expenses for continuing operations consist of the following:

Salaries, wages, and commissions $ 2,393 $ 1,706

Taxes, other than income taxes 540 359

Warranty reserve 15 4

Customer rebate liability 176 243

Note 9: Shareholders' Equity

Authorized shares of common stock were $24.0 million ($1.00 par value) at December 31, 2024 and 2023.

Share Repurchase Program

The Company's previous share repurchase program allowed for repurchase of up to 790,383 shares of the Company's outstanding common stock and expired on February 17, 2025. On February 17, 2025, the Board of Directors authorized a new share repurchase program allowing for repurchase of up to 1.0 million shares of the Company's outstanding common stock over 24 months. See Note 16 for additional information. The shares will be purchased from time to time at prevailing market prices, through open market or privately negotiated transactions, depending on market conditions. Under the program, the purchases will be funded from available working capital, and the repurchased shares will be returned to the status of authorized, but unissued shares of common stock or held in treasury. There is no guarantee as to the exact number of shares that will be repurchased by the Company, and the Company may discontinue purchases at any time that management determines additional purchases are not warranted. As of December 31, 2024, the Company had 435,608 shares of its previous share repurchase authorization remaining.

44

Ascent Industries Co.

Notes to Consolidated Financial Statements

Shares repurchased for the year ended December 31, 2024 and 2023 were as follows:

Year Ended December 31,

Average price per share $ 10.21 $ 8.97

1Includes broker fees incurred as part of repurchase transactions

Dividends

At the end of each fiscal year the Board reviews the financial performance and capital needed to support future growth to determine the amount of cash dividend, if any, which is appropriate. In 2024 and 2023, no dividends were declared or paid by the Company.

Note 10: Accounting for Share-Based Payments

Overview of Share-Based Payment Plans

The Company has a number of active and inactive equity incentive plans (the "Incentive Plans") under which the Company has been authorized to grant share-based awards to key employees and non-employee directors. A total of 0.8 million shares have been authorized for grant to key employees and non-employee directors under the Company's currently active Incentive Plans. As of December 31, 2024, there were 0.5 million shares remaining available for grants under the currently active equity Incentive Plans.

The Company recognized share-based compensation expense within SG&A expense on the consolidated statements of income (loss) of $0.8 million and $1.1 million in 2024 and 2023, respectively.

Total unrecognized share-based payment expense for all share-based payment plans was $0.3 million at December 31, 2024, of which $0.2 million is expected to be recognized in 2025 and $0.1 million in 2026. This results in these amounts being recognized over a weighted-average period of 1.52 years.

Stock Options

Stock options have terms of 10 years and vest in 20% or 33% increments annually on a cumulative basis, beginning one year after the date of grant, and are assigned an exercise price equal to the average of the high and low common stock price on the day prior to the date of grant. Options are expensed on a straight-line basis over the grant vesting period, which is considered to be the requisite service period. There was no compensation expense charged against income for options in 2024 or 2023.

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model. When determining expected volatility, the Company considers the historical volatility of the Company’s stock price. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant, based on the options’ expected term. The Company granted no new options in 2024 or 2023.

Transactions related to stock options for the year ended December 31, 2024 are summarized as follows:

Exercised — —

Canceled, forfeited, or expired 14.76 (8,109)

Vested and expected to vest at December 31, 2024 $ — — — $ —

45

Ascent Industries Co.

Notes to Consolidated Financial Statements

Restricted Stock Awards

Restricted stock awards are valued based on the average of the high and low common stock price on the day prior to the date of grant. In general, these awards vest in either 20% or 33% increments annually on a cumulative basis, beginning one year after the date of grant. Certain of these awards vest 100% at the end of a three-year period from the date of grant. In order for the awards to vest, the employee must be in the continuous employment of the Company since the date of the award. Except for death, disability, or qualifying retirement, any portion of an award that has not vested is forfeited upon termination of employment. An employee is not entitled to any voting rights with respect to any shares not yet vested, and the shares are not transferable.

All awards are expensed on a straight-line basis over the grant vesting period, which is considered to be the requisite service period. The weighted average period over which the restricted stock awards compensation expense is expected to be recognized is 1.99 years.

Transactions related to restricted stock awards for the year ended December 31, 2024 are summarized as follows:

Shares Weighted AverageGrant Date Fair Value

Performance Stock Units

The Company issues performance stock units classified as equity awards which contain market conditions that must be satisfied for an employee to earn the right to benefit from the award. Performance stock units vest upon the achievement of specific thirty-day volume-weighted average price targets of a share of the Company's common stock over a period of three years. In order for the awards to vest, the employee must be in the continuous employment of the Company since the date of the award. Except for death, disability, or qualifying retirement, any portion of an award that has not vested is forfeited upon termination of employment. An employee is not entitled to any voting rights with respect to any shares not yet vested, and the shares are not transferable.

The performance stock units are divided into tranches, each one vesting on the date the thirty-day volume-weighted average price of the Company's common stock `meets or exceeds the price target as set forth in the table below:

Shares Volume Weighted Average Price Target

The fair value of the performance stock units granted with a market performance condition are determined using a Monte Carlo simulation considering historical performance of the Company's stock as well as the probability of attaining the market performance condition determined on the date of grant. Expense is recognized on a straight-line method over the requisite service period. Performance stock units do not have dividend rights. The weighted average period over which the performance stock units compensation expense is expected to be recognized is 1.98 years.

46

Ascent Industries Co.

Notes to Consolidated Financial Statements

The weighted-average grant-date fair value per unit of performance stock units granted was $2.61 and $0.64 in 2024 and 2023, respectively. There were no performance stock units vesting in 2024 and 2023.

Transactions related to performance stock units for the year ended December 31, 2024 were as follows: