Advansix Inc. · NYSE:ASIX
Advansix — Q4 2022 Earnings Presentation
18 slides from Advansix's earnings presentation, Feb 17, 2023
Slide 1: 4Q 2022 Earnings Presentation
4Q 2022 Earnings Presentation February 17, 2023
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains certain statements that may be deemed “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, that address activities, events or
Slide 3: Overview
Overview Record Performance in 2022; Robust Cash Generation, Enhancing Capital Deployment ✓ Record annual sales, earnings and cash flow in 2022 FY22 Sales up YoY – Sales of $1.9B, Net Income of $172M, and Cash Flow from Operations of $274M ✓ Execution of value-accretive capital deployment in 2022 +1
Slide 4: FY 2022 Financial Summary
FY 2022 Financial Summary Strong Commercial Execution, Robust Ag Industry Fundamentals ($M, except per share amounts) Sales Adjusted EBITDA Highlights +15% +16% • Sales up ~15% – Price +22%: Market-Based +20%, Raw Materials Pass Through +2% – M&A +4% $1,946 $308 $1,685 $267 – Volume (10%) • EBITDA i
Slide 5: 4Q 2022 Financial Summary
4Q 2022 Financial Summary Higher Market-Based Pricing Offset by Sales Volume and Operational Performance ($M, except per share amounts) Sales Adjusted EBITDA Highlights (5%) +28% • Sales down (5%) – Price +6%: Market-Based +10%, Raw Materials Pass Through (4%) – M&A +4% $424 $404 $67 – Volume (15%)
Slide 6: 4Q 2022 Adjusted EBITDA Bridge
4Q 2022 Adjusted EBITDA Bridge Strong Commercial Execution Offset by Volume and Inflation ($M) Driving value through commercial excellence to more than offset volume decline ($26) $18 $44 ($21) • Soft end market • $0 in 4Q22 vs $18M in • Higher cost/plant spend: demand, primarily in 4Q21 consumer du
Slide 7: Cash Flow Generation and Use
Cash Flow Generation and Use Robust Cash Generation, Enhancing Capital Deployment Cash Flow Generation ($M) Capital Allocation FY22 2017–2021 Total 2022 Net Income $172 8% 18% 6% Depreciation & Amortization $69 Accounts Receivable $18 13% 38% Inventories ($57) 14% 66% Accounts Payable $46 35% Deferr
Slide 8: Disciplined Capital Deployment
Disciplined Capital Deployment Continued Investment in the Business, Generating High Returns Return on Invested Capital (ROIC) ($M) • Sustaining capex and turnarounds – optimizing 17% 19% execution and disciplined re-investment 8% 6% 11% 11% • Improved through-cycle profitability – realizing 6% valu
Slide 9: Industry Pricing And Spreads
Industry Pricing And Spreads Nylon Ammonium Sulfate Chemical Intermediates North America Demand Mixed Overall Lower Energy Costs, Ag Fundamentals Remain Strong Lower Input Costs, Balanced Supply and Demand (cents per ($/ston N pound) 1600 4000 2000 120 ($/MT) content basis) 3600 1800 100 1200 3200 1
Slide 10: 2023 Outlook
2023 Outlook Executing on Strategic Priorities to Continue Driving Shareholder Value • Expect strong underlying agriculture and fertilizer industry fundamentals to continue • Expect balanced supply and demand conditions for North American acetone Sales by End Market* Coatings, Other • Expect headwin
Slide 11: Well Positioned To Deliver Attractive Returns Over Long-Term
Well Positioned To Deliver Attractive Returns Over Long-Term • Integrated, efficient and low-cost business model supported by unique combination of assets Leading North American Position and Advantaged • Security of raw material supply strengthened through contracts with long-term qualified supplier
Slide 12: Appendix
APPENDIX 12 4Q 2022 Earnings Presentation – February 17, 2023
Slide 13: Planned Plant Turnarounds
Planned Plant Turnarounds Pre-Tax Income Impact by Quarter (1) 1Q 2Q 3Q 4Q FY • Timing driven by compliance, inspection and sustaining asset base 2017 -- ~$10M ~$4M ~$20M ~$34M • Critical to supporting high utilization rates 2018 ~$2M ~$10M ~$30M -- ~$42M • Dedicated teams to improve effectiveness 2
Slide 14: Reconciliation of Non-GAAP Measures to GAAP Measures
APPENDIX Reconciliation of Non-GAAP Measures to GAAP Measures 14 4Q 2022 Earnings Presentation – February 17, 2023
Slide 15: Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow
Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow and Free Cash Flow Conversion (in $ thousands) (1) Free cash flow is a non-GAAP measure defined as Net cash provided by operating activities less Expenditures for property, plant and equipment (2) Free cash flow conversion
Slide 16: Reconciliation of Net Income to Adjusted EBITDA
Reconciliation of Net Income to Adjusted EBITDA (in $ thousands) (1) Adjusted EBITDA margin is defined as Adjusted EBITDA divided by Sales The Company believes the non-GAAP financial measures included in this presentation provide meaningful supplemental information as they are used by the Company’s
Slide 17: Reconciliation of Earnings Per Share to Adjusted Earnings Per Share
Reconciliation of Earnings Per Share to Adjusted Earnings Per Share (in $ thousands except share and per share amounts) The Company believes the non-GAAP financial measures included in this presentation provide meaningful supplemental information as they are used by the Company’s management to evalu
Slide 18: Calculation of Return on Invested Capital (ROIC)
Calculation of Return on Invested Capital (ROIC) (in $ thousands) (1) Average of Current and Prior Year Total Debt plus Total Shareowners Equity. Total Debt includes Operating Lease Liabilities. The Company believes the non-GAAP financial measures included in this presentation provide meaningful sup