KOP 10-K & 10-Q changes, risk factors and insider trading

▪The availability and cost of lumber are critical elements in our production of railroad crossties, utility poles and other related wood products for our RUPS business. Historically, the supply and cost of hardwood for railroad crossties have been subject to availability and price pressures. We may not be able to obtain wood raw materials at economical prices in the future or be able to pass on higher raw material costs to our customers.

▪The availability of scrap copper is a critical element in our production of copper-based wood preservation chemicals for our PC business. Our purchase price for scrap copper is based upon spot prices in the copper market, which may be subject to sudden price changes. We may not be able to obtain scrap copper at prices that match underlying pricing commitments to our customers.

▪The primary raw material used by our CMC business is coal tar, a by-product of coke production. Currently, our CMC business supplies our North American RUPS business with 100 percent of its creosote requirements. A shortage in the supply of domestic coal tar or a reduction in the quality of coal tar could require us to increase coal tar or creosote imports to meet future creosote demand. This could cause a significant increase in our operating expenses and we may be unable to pass some or all of these costs on to our customers. Additionally, if domestic pitch markets decline significantly domestically,significantly, the domestic creosote markets will become out of balance with pricing and volumes.

▪In certain circumstances coal tar may also be used as an alternative to fuel. In the past, increases in energy prices have resulted in higher coal tar costs which we have attempted to pass through to our customers. If these increased costs cannot be passed through to our customers, it could result in reduced profitability for our coal tar-based products.

▪Our price realizations and profit margins for phthalic anhydride, naphthalene and carbon black feedstock have historically fluctuated with the market price of crude oil, market prices for chemicals derived from crude oil, such as ortho-xylene, or market indices derived from crude oil. These fluctuations may reduce profitability in the future.

▪We import certain raw materials that are used in our products that are, or may become, subject to tariffs, trade restrictions or supply chain disruptions. For example, we sell and purchase goods and raw materials from Canada and Denmark both with third parties and our subsidiaries.subsidiaries for all businesses. In particular, our RUPS business sources creosote from one of our subsidiaries in Denmark and evolving events around Greenland could result in tariffs or trade restrictions being imposed on this raw material. In addition, the potential for regionalsoutheast Asia conflict between China and Taiwan could result in disruptions of raw materials that our CMC and KPCPC businesses source from China and Taiwan.

Further, the United States government, other governments or international organizations could impose sanctions that could restrict us from doing business directly or indirectly in or with certain countries or parties, which could include raw material suppliers or customers. For example, due to the Russian invasion of Ukraine, our European-based CMC business lost a substantial portion of its coal tar supply that werewas previously sourced from the Russian Federation and Ukraine. Geopolitical events further impacting these countries, or other countries from which we source raw materials or where our facilities or customers are located, could adversely affect the impacted business segments. Additionally, the current US presidential administration has imposed new tariffs on imports to the United States, and although considerable uncertainty remains, has indicated that it may impose additional tariffs or significantly increase existing tariffs, including on goods imported from Canada, Denmark, Mexico and China, and certain other countries in the European Union, all of which could negatively impact our business.

If the costs of raw materials increase significantly (including as a result of tariffs or inflation) and we are unable to offset the increased costs with higher selling prices, our profitability will decline. Any such occurrence could have a material adverse effect on our operating results, financial condition, cash flows and liquidity.

▪making it more difficult for us to make payments on our debt;

▪increasing our vulnerability to general economic and industry conditions;

▪exposing us to the risk of increased interest rates as certain of our borrowings under our Credit Facility are at variable rates;

▪restricting us from making strategic acquisitions or causing us to make non-strategic divestitures;

▪limiting our ability to obtain additional financing for working capital, capital expenditures, product development, debt service requirements, acquisitions, and general corporate or other purposes; and limiting our ability to adjust to changing market conditions and placing us at a competitive disadvantage compared to our competitors who may be less highly leveraged.

▪incur additional debt;

▪pay dividends or distributions on our capital stock or repurchase our capital stock;

▪issue stock of subsidiaries;

▪make certain distributions;

▪make certain investments;

▪create liens on our assets to secure debt;

▪enter into transactions with affiliates;

▪modify material documents (including organizational documents);

▪make certain acquisitions;

▪merge or consolidate with another company; and sell or otherwise transfer assets.

▪The principal use of our wood preservation chemicals is in the manufacture of treated lumber, which is used mainly for residential applications, such as wood decking, and also industrial applications, such as the treating of railroad crossties and utility poles. Therefore, a decline in remodeling and construction could reduce demand for wood preservation chemicals for residential applications, and a decline in the capital spending practices for railroads and utility companies could reduce demand for wood preservation chemicals for industrial applications.

▪The principal consumers of our carbon pitch are primary aluminum smelters. Although the global aluminum industry has experienced growth on a long-term basis, the aluminum industry has experienced a shift in primary aluminum production from the mature geographies, where we have historically enjoyed high market shares, to emerging economies, where we have less of a presence.

▪piping and storage tank leaks and ruptures;

▪mechanical failure;

exposure to hazardous substances; and ▪chemical spills and other discharges or releases of toxic or hazardous wastes, substances or gases.

These hazards, among others, may cause personal injury and loss of life, damage to property and contamination of the environment, which could lead to government fines or work stoppage injunctions, cleanup costs and lawsuits by injured persons.persons or property owners. While we are unable to predict the outcome of such matters, if determined adversely to us, we may not have adequate insurance to cover related costs or liabilities and, if not, we may not have sufficient cash flow to pay for such costs or liabilities. Such outcomes could harm our reputation, customer goodwill and reduce our profitability and could have a material adverse effect on our business, financial condition, cash flow and results from operations.

▪the treatment, storage and disposal of wastes;

▪the investigation and remediation of contaminated soil and groundwater;

▪the discharge of effluents into waterways;

▪the emission of substances into the air;

▪the marketing, sale, use and registration of our chemical products, such as creosote, CCA, DCOI, MicroPro® and naphthalene;

▪the U.S. Environmental Protection Agency’s regulation under the Federal Insecticide, Fungicide, and Rodenticide Act which requires the registration and authorization of antimicrobial pesticide products to be used for various applications in the United States;

▪the Health Canada Pest Management Regulatory Agency and its Pest Control Products Act which requires the registration and authorization of antimicrobial pesticide products to be used for various applications in Canada;

▪the European Union’s regulation under the Registration Evaluation Authorization and Restriction of Chemicals, which requires manufacturers or importers of substances manufactured or imported into the European Union in quantities of one ton per year or more to register with a central European Chemicals Agency;

▪the European Union’s regulation under the Biocidal Products Regulation, which requires a biocidal product to be authorized by the European Chemicals Agency before it can be marketed or used in the European Union;

▪the Great Britain Biocidal Products Regulation, which requires a biocidal product to be authorized before it can be marketed or used in Great Britain; and other matters relating to environmental protection, health and safety.

Heavy energy-using installations in the European Union operate under the EU Emissions Trading System (EU ETS), a cap and trade system on emissions. The scope of EU ETS has expanded and since 2025, our Nyborg facility has reported scope 1 emissions to EU ETS. Under this system, organizations apply to the Member State for an allowanceallowances of GHG emissions.emissions and by 2028, our Nyborg facility is expected to be enrolled and allocated allowances. These allowances are gradually reduced year by year, to encourage reductions and are also tradable to enable companies that reduce their GHG emissions to sell their excess allowances to companies that are not reaching their emissions objectives. The Green Deal, which was approved by the EU Parliament in 2020, has set a goal of a 55 percent reduction in emissions by 2030 and carbon neutrality by 2050. This will include revising and possibly expanding the EU ETS and setting targets for sectors outside the EU ETS.

In Australia, the National Greenhouse and Energy Reporting Scheme requires large volume emitters (such as Koppers) to report greenhouse emissions and energy use to the government annually and, if they exceed certain thresholds, the ‘Safeguard Mechanism’ requires facilities to set an emissions baseline and either manage their emissions or purchase certificates if they exceed that baseline. Although Koppers does not currently exceed the threshold for the Safeguard Mechanism (100,000 TCO2e scope 1 emissions), it is foreseeable that the government could lower the threshold in the future. The Australian government has released draft legislation that seeks to introduce mandatory requirements for large businesses and financial institutions to disclose their climate-related risks and opportunities. It is anticipated that Koppers Australia will be required to disclose its climate related impacts, risks and opportunities from the financial year commencing on July 1, 2026. At the state level in Australia, the New South Wales Environment Protection Authority released its Climate Change Policy and Action Plan, which proposes to introduce greenhouse gas emission targets and limits on environment protection licenses. TheDuring 2022, the Australian Competition and Consumer Commission and the Australian Securities and Investments Commission both announced they would be increasing monitoring of, and penalties for, misleading statements in relation to net zero commitments.

Our quarterly operating results fluctuate due to a variety of factors that are outside our control, including inclement weather conditions, which in the past have caused a decline in our operating results. For example, adverse weather conditions have, at times, negatively impacted our supply chain as wet conditions impacted logging operations, reducing our ability to procure crossties. In addition, adverse weather conditions have had a negative impact on our customers in our wood preservation businesses, resulting in a negative impact on our sales of these products. Moreover, demand for many of our products declines during periods of inclement weather. Finally, natural disasters, including but not limited to wildfires, hurricanes and earthquakes, could affect our revenue and operating results. It is impossible to predict the timing, magnitude or location of such natural disasters or their impacts on the local economy and on our local or integrated operations. If a major wildfire, hurricane or other natural disaster were to disrupt the supply of our raw materials or damage or destroy our facilities or manufacturing equipment, we may experience potential impacts ranging from production and shipping delays to lost profits and revenues. Global climate change may exacerbate the frequency and intensity of adverse weather conditions or natural disasters, such as wildfires, hurricanes, tornadoes, droughts, water shortages, rainfall, unseasonably warm or cold winter months, or other weather events, many of which have increased in severity in recent years, in geographic areas where our products are manufactured, distributed, sold and used and where our supply chains are located, and our sales and operating results may be affected to a greater degree than we have previously experienced. Such weather conditions could pose physical risks to our facilities and critical infrastructure in the United States and abroad, disrupt the operation of our supply chain and third-party vendors, and may impact our operating results.

Political and financial instability can lead to economic uncertainty and may adversely impact our business. For example, geopolitical tensions between the United States and Denmark could have an adverse impact on our business, financial condition and results of operations. In addition, as a global business, we are also exposed to market risks relating to fluctuations in interest rates and foreign currency exchange rates. Our international revenues could be reduced by currency fluctuations or devaluations. Changes in currency exchange rates could lower our reported revenues and could require us to reduce our prices to remain competitive in foreign markets, which could also reduce our profitability. We are also subject to potentially increasing transportation and shipping costs associated with international operations. Furthermore, we are also exposed to risks associated with changes in the laws and policies governing foreign investments in countries where we have operations, as well as changes in U.S. laws and regulations relating to foreign trade and investment.

As of December 31, 2024,2025, our benefit obligations under our definedpost-retirement benefit pension plans exceeded the fair value of plan assets by $10.2$14.5 million excluding the largest United States qualified plan that was terminated in February 2025.million. Our pension asset funding to total pension obligation ratio was 7781 percent as of December 31, 2024 on the same basis.2025. The underfunding was caused, in large part, by fluctuations in the financial markets that impacted the value of the assets in our defined benefit pension plans and by fluctuations in interest rates which increased the discounted pension liabilities. In addition, our obligations for other post-retirement benefits are unfunded and total $5.7 million at December 31, 2024.

We periodically assess our manufacturing operations in order to manufacture and distribute our products in the most efficient manner. Based on our assessments, we may make capital improvements to modernize certain units, move manufacturing or distribution capabilities from one plant or facility to another plant or facility, discontinue manufacturing or distributing certain products or close all or part of a manufacturing plant or facility, any of which could cause us to incur significant charges. The actual costs to close a manufacturing facility may exceed our original cost estimatesestimates, for example, environmental remediation costs, and may have a material adverse effect on our financial condition, cash flow from operations and results from operations.

We depend on integrated information systems to conduct our business. Information technology systems failures could disrupt our operations by impeding our processing of transactions, our ability to protect customer or company information and our financial reporting. System failures include risks associated with upgrading our systems, integrating information technology and other systems in connection with the integration of businesses we acquire, network disruptions and breaches of data security. Our computer systems, including our back-up systems, could be damaged or interrupted by power outages, computer and telecommunications failures, computer viruses, malware, ransomware, internal or external security breaches, events such as fires, earthquakes, floods, tornadoes and hurricanes, and/or errors by our employees.

▪Our shareholders are able to remove directors only for cause by the affirmative vote of the holders of a majority of the outstanding shares of our capital stock entitled to vote in the election of directors. Vacancies on our board of directors may be filled only by our board of directors.

▪Under Pennsylvania law, cumulative voting rights are available to the holders of our common stock if our Articles of Incorporation have not negated cumulative voting. Our Articles of Incorporation provide that our shareholders do not have the right to cumulative votes in the election of directors.

Adjusted EBITDA is a non-GAAP financial measure defined as income from continuing operations before interest,interest expense, income taxes, depreciation, amortization and other adjustments. These other adjustments are items that we believe are not representative of underlying business performance. Adjusted items typically include certainLIFO expensesinventory associated witheffects, impairment, restructuring and plant closure costs, significant gains and losses on asset disposals or business combinations, LIFO, mark-to-market commodity hedging, acquisition-related charges, cloud-computing amortization expenses and other unusual items. The LIFO expense adjustment removes the entire impact of LIFO and effectively reflects the results as if we were on a FIFO inventory basis. An Adjustedadjusted EBITDA Reconciliationreconciliation is presented in the Segment Results section and reconciles net income to adjusted EBITDA on a consolidated basis.

After considering the current intensely competitive environment, global economic conditions, as well as ongoing uncertainty associated with geopolitical and supply chain challenges, we anticipatecommenced taking measures to streamline our organization to support an increasingly cost-conscious customer base. These actions, some of which are one-time savings and some of which are expected to be permanent savings, are intended to ensure that we extendgrow our decade-long growth in profitability and support a higher margin profile by leveraging a smaller global team highly focused on serving customer preferences. Through the planning phase that occurred throughout 2025, we believe we have identified actionable transformation initiatives to position Koppers for future success, creating a roadmap to reshape our company into a higher earning, higher margin, higher free cash flow and higher return on capital business over the next three years. These initiatives impact all facets of the organization and are focused on growing the more profitable businesses while continuing to selectively scale back our lower margin, capital intensive business. We believe this will grow earnings per share, lower our maintenance and capital requirements and consistently generate higher margins.

•For our RUPS segment, our focus is to continue to (i) recoup cost increases, including the value of our creosote preservative in the market, (ii) maximize opportunities for increased volumes, including expanding our customer base intoin the Texas, westernmidwestern and midwesternwestern utility pole markets and (iii) lower operating and selling, general and administrative expenses.

•For our PC segment, our focus is to continue to (i) acquire new customers and grow organic market share in our residential preservatives markets to offset certain customer market share losses, (ii) expand market share in our industrial preservatives markets and (iii) align and improve our cost structure.

•For our CMC segment, our focus is to continue to (i) execute on domestic plant restructuring projects, (ii) optimize and develop markets for enhanced carbon products and (iii) develop and implement global tar and pitch strategies.strategies to mitigate expected raw material cost increases.

•The Railway Tie Association’s estimate of total crosstie purchases in 20252026 is approximately 19.519.9 million ties, with approximately 13.3 million for Class I railroads. This is slightlycomparable lower thanto the estimated2025 2024estimate of crosstie purchases of approximately 19.619.9 million crossties. Over the past few years, North American demand for crossties has been in the range of 18 million to 22 million crossties with the small decrease expected to be from Class I railroads.annually. We expect the crosstie market to remain stable.stable and within this range. However, volumes for our business in any year can be affected by individual customer demands, logistics and business conditions.

•Product demand for our PC business has historically been associated with consumer spending on home repair and remodeling projects in North America. The Leading Indicator of Remodeling Activity (LIRA) reported by the Joint Center for Housing Studies of Harvard University projects that year-over-year spending for annual homeowner renovation and maintenance expenditures is expected to grow by 1.22.9 percent in 2025.early While2026 before easing to 1.6 percent by the LIRAend projectsof a2026. mild increase in 2025, ourOur PC business expects flat or lowerhigher volumes as a result of customerthrough market share shifts.growth and acquiring new customers supported by the LIRA projections.

•For the external markets served by our CMC business, we have experienced a slowdown in themanufacturing near-termoverall as well as in manufacturing overall, including the steel, aluminum and carbon black industries. The availability of coal tar, the primary raw material for our CMC business, is linked to levels of metallurgical coke production. As the global steel industry, excluding Asia, has reduced the production of steel using metallurgical coke, the volumes of coal tar have been reduced. We are actively working to mitigate the impacts of the long-term decline of coal tar supply by gaining market acceptance for petroleum-blended products,products. We are also investing in projects to increase distillation yields and balancingbalance raw material supply and cost with customer demand and pricing.

Our businesses and results of operations are affected by various competitive and other factors including (i) the impact of global economic conditions on demand for our products, including the impact of imported products from competitors in certain regions where we operate as well as tariffs and international trade policy; (ii) raw material pricing and availability, in particular the cost and availability of hardwood lumber for railroad crossties, softwood lumber for utility poles, scrap copper prices, and the cost and amount of coal tar available in global markets, which is negatively affected by reductions in blast furnace steel production; (iii) volatility in oil prices, which impacts the cost of coal tar and certain other raw materials, as well as selling prices and margins for certain of our products including carbon black feedstock, phthalic anhydride,feedstock and naphthalene; (iv) competitive conditions in our performance chemicals business and global carbon pitch markets; (v) the effectiveness of our commodity hedging programs; (vi) changes in foreign exchange rates; and (vivii) the other factors set forth in the section titled "Forward-Looking Statements.Statements" disclaimer. Any or all of these or other factors could impact our actual results for 2025.results.

CMC net sales decreased largelymainly due to $81.4lower phthalic anhydride volumes of $67.5 million as we ceased production of the product in the second quarter of 2025, lower volumes and prices for carbon black feedstock and lower sales prices acrossfor mostmultiple products, especiallyparticularly for carbon pitch wherewhich pricesdecreased were down approximately 20six percent globally, along with $25.0 million of lower volumes of carbon pitch.globally. The decreases in carbon pitch prices and volumes were driven by reduced market demanddynamics in the current year period.period, particularly in Australasia. These decreases were partly offset by volume increases for phthaliccarbon anhydridepitch, naphthalene, creosote and otherrefined products.tar. Foreign currency changes compared to the prior year period from our international markets had a favorable impact on sales in the current year period of $3.3 million.

Cost of sales as a percentage of net sales was 76 percent, compared to 80 percent forin boththe periodsprior year period as lower rawoperating materialexpenses and freight costs were partly offset by thelower marketsales driven reduction in sales.volumes. Significant items impacting cost of sales in individual operating segments are discussed as part of "Segment adjusted EBITDA and adjusted EBITDA margin" herein.

Selling, generalDepreciation and administrativeamortization expenses were $5.2$6.1 million higher when compared to the prior year period dueprimarily mainlyas toa anresult increaseof increased asset retirement obligations in compensation-relatedour costsNorth alongAmerican withCMC an increase in professional serviceoperations and insuranceour expenses.acquisition of Brown Wood.

Impairment and restructuring charges for both years were $16.9 million in 2024 due primarily to thecosts decisionassociated towith discontinuediscontinuing phthalic anhydride production at our facility in Stickney, IllinoisIllinois, consulting services related to our comprehensive assessment of our businesses and our workforce reduction program across selected U.S. locations to streamline operations and reduce costs. See Note 3 – Acquisitions, DivestituresAcquisitions and Discontinued Operations.Restructuring.

Loss(Gain) (gain)loss on sale of assets in the prior year period was primarily related to the liquidation of our former coal tar distillation facility located in China while the gain on sale of assets for 2023 was related to a sale of assets at that same facility.China. See Note 3 – Acquisitions, DivestituresAcquisitions and Discontinued Operations.Restructuring.

Income taxInterest expense decreasedwas by $14.1$10.1 million lower when compared to the prior year period due primarily to lower incomeinterest before income taxes. See Note 10 – Income Taxes.rates.

RUPS adjusted EBITDA decreasedincreased due primarily to $50.3$11.6 million of higher raw material,lower operating and allocatedraw material expenses and $10.2 million of lower selling, general and administrative expenses,expense, whichin combinedaddition to more than offset net sales price increases and $11.8increased millionutilization, frompartly improvedoffset plantby utilization.net sales volume decreases.

PC adjusted EBITDA increaseddecreased despitedue primarily to lower sales,sales asvolumes aand result of lowerhigher raw material costs of $19.0 million, partly offset by lower selling, general and administrative expenses of $5.0 million, lower logistics costsexpenses offsettingof lower$4.5 salesmillion, prices.particularly Lowerin North America, and higher royalty income of $3.1 million. Higher raw material costs were favorablyunfavorably impacted by timing,scrap includingcopper ancosts, increasenet inof gainsthe benefit realized from our copper-hedging program, net of an increase in the cost of scrap copper recognized to date.program.

(1) The LIFO expense adjustment removes the entire impact of LIFO and effectively reflects the results as if we were on a FIFO inventory basis.

Net cash provided by operating activities for the year ended December 31, 20242025 was $119.4$122.5 million compared to $146.1$119.4 million in the prior year. For both periods, the primary source of cash was net income, excluding non-cash items, lessprincipally workingdepreciation and in 2025, the pension settlement loss. Working capital usage which was higherslightly lower in the current year primarily as a result of the timing of purchasesreceipts and payments.payments, partly offset by net pension funding of approximately $12 million in connection with the settlement.

Net cash used in investing activities for the year ended December 31, 20242025 was $173.3$72.7 million compared to $116.0$173.3 million in the prior year. The increasedecrease was due to cash paid for the Brown Wood acquisition, partly offset by lower capital expenditures. Capital expenditures were higheracquisition in the prior year periodas well as lower capital expenditures in the current year due to investmentthe incompletion of certain growth projects, such as the expansion of our RUPS facility in North Little Rock, Arkansas which was completed in the fourth quarter of 2023 and a yield enhancement project at our CMC facility in Nyborg, Denmark which was completed in the first quarter of 2024. These decreases were partly offset by cash paid for the Greenhill acquisition (as described in Note 3 of the Notes to Consolidated Financial Statements) in the current year.

Net cash providedused byin financing activities for the year ended December 31, 20242025 was $35.7$58.5 million compared to $2.6net cash provided by financing activities of $35.7 million in the prior year. The primary sourceuses of financing cash flows for the year ended December 31, 20242025 were net debt repayments of $12.7 million, repurchases of common stock, including payments related to taxes withheld under stock-based compensation plans, dividends and debt issuance costs. In the prior year, the primary source of financing cash flows was net borrowings of $88.7 million and the primary uses of financing cash flows were repurchases of common stock, including payments related to taxes withheld under stock-based compensation plans, and dividends paid. In the prior year, the sources of financing cash flows were net borrowings of $23.1 million and issuances of common stock due to the exercise of stock options and the primary uses of financing cash flows were repurchases of common stock, payments of debt issuance costs and dividends paid.dividends.

Our need for cash in the next twelve months relates primarily to contractual obligations which includes debt service, pension plan funding, purchase commitments and operating leases, as well as working capital, capital spending, dividends and share repurchases. We may also use cash to pursue other potential strategic acquisitions or voluntary pension plan contributions, including pension plan settlements.acquisitions. Capital expenditures in 2025,2026, excluding acquisitions, if any, are expected to total approximately $65$55 million and are expected to be funded by cash from operations. We anticipate that our liquidity will continue to be adequate to fund our cash requirements for at least the next twelve months.

We manage our working capital to increase our flexibility to pay down debt. The amount of our outstanding debt and our overall cash flows will fluctuate throughout any operating period based upon, among other things, the timing of receipts from customers and payments to vendors. As of December 31, 20242025, approximately 95 percent of accounts payable was current and 2023,5 percent was 1-30 days past due. As of December 31, 2024, approximately 85 percent of accounts payable was current and 15 percent was 1-30 days past due.

Pension and other employee benefit plan funding contributions (for defined benefit plans) are expected to total approximately $4.0$1.5 million in 2025,2026, for normal plan operations. Estimated funding obligations are determined by asset performance, workforce and retiree demographics, tax and employment laws and other actuarial assumptions, which may change the annual funding obligations in addition to decisions to fund in excess of statutorily required amounts. In addition, we terminated our largest United States qualified defined benefit plan through a funding payment of $14 million in February 2025. The funded status of our defined benefit plans is disclosed in Note 14 – Pensions and Post-Retirement Benefit Plans.

This report and any documents incorporated herein by reference contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and may include, but are not limited to, statements about sales levels, acquisitions, restructuring, declines in the value of Koppers assets and the effect of any related impairment charges, profitability and anticipated synergies, expenses and cash outflows. All forward-looking statements involve risks and uncertainties. All statements contained herein that are not clearly historical in nature are forward-looking, and words such as “outlook,” "guidance,” “forecast,” “believe,” “anticipate,” “expect,” “estimate,” “may,” “will,” “should,” “continue,” “plan,” “potential,” “intend,” “likely,” or other similar words or phrases are generally intended to identify forward-looking statements. Any forward-looking statement contained herein, in press releases, written statements or documents filed with the Securities and Exchange Commission, regarding future dividends, expectations with respect to sales, earnings, cash flows, operating efficiencies, restructurings, cost reduction efforts, transformation initiatives, product introductions or expansions, the benefits of acquisitions and divestitures, or other matters as well as financings and debt reduction, are subject to known and unknown risks, uncertainties and contingencies. Many of these risks, uncertainties and contingencies are beyond our control, and may cause actual results, performance or achievements to differ materially from anticipated results, performance or achievements. Factors that might affect such forward-looking statements, include, among other things, availability of and fluctuations in the prices of key raw materials, including coal tar, lumber and scrap copper; the impact of changes in commodity prices, such as oil, copper and chemicals, on product margins; the successful implementation of multi-year cost mitigation programs; the extent of the dependence of certain of our businesses on certain market sectors and customers; economic, political and environmental conditions in international markets, including governmental changes, tariffs, restrictions on trade and restrictions on the ability to transfer capital across countries; geopolitical events (including the current warconflicts in the Middle East); current and potential future tariffs or duties; the ratings on our debt and our ability to repay or refinance our outstanding indebtedness as it matures; our ability to operate within the limitations of our debt covenants; capital market and banking market conditions, including interest rates, borrowing costs, foreign currency rate fluctuations, and general volatility; general economic and business conditions, including labor shortages, increased employee turnover and demand for our goods and services; disruptions and inefficiencies in the supply chain; unexpected business disruptions (including, but not limited to, labor disputes, natural disasters, weather conditions, fires, explosions, unscheduled or unplanned downtime, transportation interruptions, certain regional and world events or economic conditions and public health crises) and technology-related disruptions or failures (including, but not limited to, cyber attacks or other events) related to our technology infrastructure, or at key vendors which could impact our supply chain, or at key customers which could impact their operations and cause them to curtail or pause orders; potential difficulties in protecting our intellectual property; potential delays in timing or changes to expected benefits from cost reduction efforts; timing and results of any transformation initiatives, including estimates and assumptions related to the cost and the anticipated benefits of the transformation initiatives; potential impairment of our goodwill and/or long-lived assets; demand for our goods and services; the effects of competition in the industries in which we operate, including locations of competitors and operating and market competition; changes in laws, their interpretation, and their enforcement, including tax regulations, environmental regulations or accounting standards, third-party relations and approvals, and decisions of courts, regulators and governmental bodies; the impact of environmental laws and regulations and compliance therewith; parties who are obligated to indemnify us for liabilities, including legal and environmental liabilities, fail to perform under their legal obligations; and unfavorable resolution of litigation or other legal proceedings against us, as well as those discussed more fully elsewhere in this report and in documents filed with the Securities and Exchange Commission by Koppers, particularly our latest annual report on Form 10-K and subsequent filings. We caution you that the foregoing list of important factors may not contain all of the material factors that are important to you. In addition, in light of these risks and uncertainties, the matters referred to in the forward-looking statements contained in this report and the documents incorporated by reference herein may not in fact occur. Any forward-looking statements in this report speak only as of the date of this report, and we undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.

Through our RUPS business, we believe that we are the largest supplier of railroad crossties to the Class I railroads in North America and the second largest producer of utility poles in the United States. Our utility poles are used in the electric, telephone, and broadband industries in the United States and Australia and construction pilings in the United States. In addition, we provide untreated wood products and rail joint bars to the railroad markets and inspection services to the utility markets. We also operate a business related to the recovery of used crossties, serving the same customer base as our North American railroad business.

Our CMC business processes coal tar into a variety of products, including creosote, carbon pitch, carbon black feedstock and naphthalene, which are intermediate materials necessary in the pressure treatment of wood, and the production of aluminum, steel, carbon black and high-strength concrete. See Note 2 - Restructuring for further discussion of the discontinuation of distillation and chemical manufacturing operations in Stickney, Illinois.

After considering the current intensely competitive environment, global economic conditions, as well as ongoing uncertainty associated with geopolitical and supply chain challenges, we commenced taking measures to streamline our organization to support an increasingly cost-conscious customer base. These actions, some of which are one-time savings and some of which are expected to be permanent savings, are intended to ensure that we grow our profitability and support a higher margin profile by leveraging a smaller global team highly focused on serving customer preferences. Through the planning phase that occurred throughout 2025, we believe we have identified actionable transformation initiatives to position Koppers for future success, creating a roadmap to reshape our company into a higher earning, higher margin, higher free cash flow and higher return on capital business overby the nextend threeof years.2028. These initiatives impact all facets of the organization and are focused on growing the more profitable businesses while continuing to selectively scale back our lower margin, capital intensive business. We believe this will grow earnings per share, lower our maintenance and capital requirements and consistently generate higher margins.

•For our CMC segment, our focus is to continue to (i) execute on domestic plant restructuring projects including the closurediscontinuation of distillation and chemical manufacturing operations at our Stickney, Illinois coal tar distillation plant by the end of 2026 (see Note 132 - Restructuring), (ii) optimize and develop markets for enhanced carbon products and (iii) develop and implement global tar and pitch strategies to mitigate expected raw material cost increases.

•The Railway Tie Association’s estimate of total crosstie purchases in 2026 is approximately 19.919.8 million ties, with approximately 13.413.2 million for Class I railroads, which is comparableslightly tobelow the 2025 estimate of crosstie purchases. Over the past few years, North American demand for crossties has been in the range of 18 million to 22 million crossties annually. We expect the crosstie market to remain stable and within this range. However, volumes for our business in any year can be affected by individual customer demands, logistics and business conditions.

•Market demand for utility poles is expected to grow over the next few years. The main driver for growth is the construction of data centers that support artificial intelligence development. The data centers that are being constructed nationwide consume large amounts of electricity.electricity which will require infrastructure expansion including utility poles. Other drivers of pole demand include aging pole infrastructure, the expansion of renewable energy, vehicle electrification, grid-hardening measures, and extreme weather protection.protection and increased manufacturing. Our Utility Products business continues to focus on expanding its presence in the midwestern and western United States.

•Product demand for our PC business has historically been associated with consumer spending on home repair and remodeling projects in North America. The Leading Indicator of Remodeling Activity (LIRA) reported by the Joint Center for Housing Studies of Harvard University projects thatexpects year-over-year spendinggrowth forin annual homeownerhome renovation and maintenancerepair expenditures is expected to grow by 2.1 percent in the middlespending of 2026just before easing to 1.60.5 percent by the endfirst quarter of 2026.2027 - a pace that remains positive in nominal terms but is less than overall inflation. Our PC business expects higher volumes through market share growth and acquiring new customerscustomers, supportedincluding byinternational the LIRA projections.expansion.

•For the external markets served by our CMC business, we have experienced a slowdown in manufacturing overall as well as in the steel, aluminum and carbon black industries. The availability of coal tar, the primary raw material for our CMC business, is linked to levels of metallurgical coke production. As the global steel industry, excluding Asia, has reduced the production of steel using metallurgical coke, the volumes of coal tar have been reduced. We are actively working to mitigate the impacts of the long-term decline of coal tar supply by gaining market acceptance for petroleum-blended products. We arehave also investinginvested in projects to increase distillation yields and balance raw material supply and cost with customer demand and pricing.

Results of Operations – Comparison of Three Months Ended MarchJune 31,30, 2026 and 2025

RUPS net sales decreased due primarily to customer mix in our Class I crosstie business, lower activity in our maintenance-of-way businesses, including approximately $9.6$11.9 million related to the sale of our railroad services business during the third quarter of 2025, and price decreases across multiple markets, particularly for crossties.crossties, and unfavorable sales mix. These decreases were partly offset by increaseda volumes16 percent volume increase in our domestic utility pole business, including our acquisition of a western U.S. pole procurement business, and higherincreased volumes infor our commercial crosstie business.crossties. Foreign currency changes had a favorable impact on sales in the current year period of $1.4$1.0 million compared to the prior year period, mainly from our Australian utility pole business.

PC net sales increased due to aan 1511 percent volume increase along with higher sales prices, in each case,increase, primarily in the Americas.Americas, partly offset by lower prices, primarily in Europe. Foreign currency changes from our international markets had a favorable impact on sales in the current year period of $2.7$2.2 million compared to the prior year period.

CMC net sales decreasedincreased due mainly due to volume and price increases for carbon black feedstock and volume increases for carbon pitch. These increases were partly offset by lower volumes of phthalic anhydride volumesand ofrefined $13.9 milliontar as wewell ceased production of the product in the second quarter of 2025 andas lower sales prices across most products, especiallyfor carbon pitch where prices were down approximately ninetwo percent globallyglobally. The decreases in carbon pitch prices were driven by market dynamics.dynamics Thesein decreasesthe werecurrent partlyyear offsetperiod, byparticularly volumein increases for carbon pitch, naphthalene and carbon black feedstock.Australasia. Foreign currency changes from our international markets had a favorable impact on sales in the current year period of $7.6$3.5 million compared to the prior year period. See Note 2 - Restructuring for further discussion.

Cost of sales as a percentage of net sales was 8179 percent, compared to 77 percent in the prior year period as higher raw material and operatingfreight expensescosts combinedwere withpartly loweroffset by higher sales prices.volumes. Significant items impacting cost of sales in individual operating segments are discussed as part of "Segment Results" herein.

Impairment and restructuring charges in the current year period represent costs associated with the plans to cease production at our facility in Stickney, Illinois, the decision to idle two plants in our RUPS business,business and consulting services related to our comprehensivemulti-year assessmentbusiness oftransformation our businesses and discontinuing phthalic anhydride production at our facility in Stickney, Illinois.activities. In the prior year period, it also includes our workforce reduction program across selectedselect U.S. locations to streamline operations and reduce costs. See Note 2 - Restructuring.

Interest expense was $1.6$2.3 million lower when compared to the prior year period due to lower interest rates andas well as lower borrowings.

Income tax expense(benefit) increasedprovision decreased by $4.1$35.9 million when compared to the prior year period due primarily to higherlower income before income taxes.taxes primarily as a result of impairment and restructuring charges. See Note 8 – Income Taxes.Taxes and Note 2 - Restructuring.

RUPS adjusted EBITDA decreased due primarily to lower net sales prices,price lowerdecreases and unfavorable sales volumesmix, higher raw material costs and lower activity in our maintenance-of-way businesses, including approximately $0.6$2.3 million related to the sale of our railroad services business during the third quarter of 2025. These decreases were partly offset by increased sales volume in our domestic utility pole business.

PC adjusted EBITDA increased due primarily to higher sales volumes and prices,volumes, partly offset by $2.4$3.6 million of higher raw material andlogistics, operating costs. Higherand raw material costs were unfavorably impacted by scrap copper costs, net of the benefit realized from our copper-hedging program.expenses.

CMC adjusted EBITDA decreased due to lower sales prices as well asand higher raw material, operating and rawselling, materialgeneral costs.and administrative expenses of $10.8 million. These decreases were partly offset by the operating cost savings of $4.1 million from discontinuing phthalic anhydride production at our facility in Stickney, Illinois.

Net cash provided by operating activities for the threesix months ended MarchJune 31,30, 2026 was $46.3$96.3 million compared to net cash usedprovided inby operating activities of $22.7$27.8 million in the prior year. For both periods, theThe primary source of cash was net income,income excluding non-cash items, principally impairment, depreciation andand, in 2025, the pension settlement loss. Working capital usage improved in the current year primarily as a result of the timing of receipts and payments as well as a reduction in inventory. Additionally, in 2025, working capital was negatively impacted by pension funding of approximately $14 million in connection with the settlement.

Net cash used in investing activities for the threesix months ended MarchJune 31,30, 2026 was $10.5$22.4 million compared to $17.6$39.3 million in the prior year. The decrease was due primarilyin part to cash paid in 2025 for a land transfer associated with our agreement to liquidate KCCC.

Net cash used in financing activities for the threesix months ended MarchJune 31,30, 2026 was $31.0$70.7 million compared to net cash provided by financing activities of $28.7$3.3 million in the prior year. In the current year, the primary uses of financing cash flows were repurchases of common stock, including payments related to taxes withheld under stock-based compensation plans, net repayments of $23.5 million and dividends. In the prior year, the primary source of financing cash flows was net borrowings of $49.1$37.2 million and the primary uses of financing cash flows in the prior year were repurchases of common stock, including payments related to taxes withheld under stock-based compensation plans, and dividends.

As of MarchJune 31,30, 2026, liquidity from our Credit Facility after considering restrictions from debt covenants and cash on hand was approximately $386$390 million. Our Credit Facility is described in Note 11 – Debt.

We manage our working capital to increase our flexibility to pay down debt. The amount of our outstanding debt and our overall cash flows will fluctuate throughout any operating period based upon, among other things, the timing of receipts from customers and payments to vendors. As of MarchJune 31,30, 2026, approximately 85 percent of accounts payable was current and 15 percent was 1-30 days past due. As of December 31, 2025, approximately 95 percent of accounts payable was current and 5 percent was 1-30 days past due.

•The total net leverage ratio is calculated as of the last day of each fiscal quarter in accordance with the Credit Facility definitions of consolidated total net debt divided by consolidated EBITDA and is not permitted to exceed 4.75. The total net leverage ratio as of MarchJune 31,30, 2026 was 3.4.

•The cash interest coverage ratio, calculated as of the last day of each fiscal quarter, is not permitted to be less than 2.0. The cash interest coverage ratio as of MarchJune 31,30, 2026 was 4.4.