Ashland Inc. · NYSE:ASH
Ashland — J.P. Morgan Sixth Annual Diversified Industries Conference (June 2011)
15 slides from Ashland's conference presentation, Jun 7, 2011
Slide 1: J.P. Morgan Sixth Annual Diversified Industries Conference
Exhibit 99.1 J.P. Morgan Sixth Annual Diversified Industries Conference June 7, 2011 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements are based upon a number of assumptions, risks and uncertainties, i
Slide 3: Strong Leadership Positions in Markets We Serve
Strong Leadership Positions in Markets We Serve Ashland Ashland Ashland Ashland Aqualon Hercules Performance Consumer Functional Water Materials Markets Ingredients Technologies (Valvoline) #1 global #1 global #1 global leader #3 passenger-car producer producer in unsaturated motor oil and of cellul
Slide 4: June Quarter Update
June Quarter Update · Raw material costs have increased during quarter - Consumer Markets and Water Technologies particularly affected · Flooding of Mississippi and Ohio river system negatively affecting Consumer Markets - Supply constraints and increased costs expected to unfavorably affect operati
Slide 5: ISP Transaction Overview
ISP Transaction Overview Expanding our specialty chemical foundation · Ashland to acquire privately owned International Specialty Products Inc. - Specialty chemical manufacturer of innovative functional ingredients - Solutions provider to key growth markets such as personal care and pharmaceutical -
Slide 6: ISP Overview
ISP Overview High-margin, global business · Leading manufacturer of functional ingredients to personal care and pharmaceutical markets - EBITDA margins ~ 21% – 22% - Robust top-line growth · Unique technology portfolio that meets a variety of demanding customer applications - More than 400 active pa
Slide 7: ISP Business
ISP Business · Highly specialized products to meet customers’ unique specifications · Products represent a small fraction of customers’ overall costs, but provide high functionality · Broad technology portfolio protected by patents, trade secrets and manufacturing know-how · High capital costs to re
Slide 8: ISP Transaction Rationale
ISP Transaction Rationale · Strengthens positions in number of important high-growth, high-margin end markets - Pharmaceutical: Excipients - Personal Care: Hair Care, Skin Care, Oral Care · Broadens Ashland’s intellectual-property portfolio of water-soluble polymers and global R&D and applications c
Slide 9: ISP Transaction Financing
ISP Transaction Financing Attractive, low-cost financing · Purchase price of $3.2 billion - $2.9 billion of new financing to be drawn at closing • Term Loan A ~ $1.2 billion • Term Loan B ~ $1.7 billion - Remaining closing amounts will come from available cash - Will optimize exact mix of financing
Slide 10: Cost Synergies
Cost Synergies History of meeting synergy targets · Expect ~$50 million annualized cost savings · Expect to achieve full synergies by second year of operation · History of success in delivering synergies - Hercules integration plan and resultant synergies 10
Slide 11: Key Items
Key Items Clear path to completion · Receipt of necessary regulatory approvals - Will require EU and U.S. filings · Completion of standard and customary closing conditions - No financing contingency - Reverse termination fee of $413 million · Path to completion - Expect to close by end of September
Slide 12: Accretion
Accretion Expect immediate accretion to Ashland EPS · ISP financials - Trailing 12 months’ EBITDA of $360 million - Depreciation and amortization of $66 million - Tax rate of mid-30% · Purchase accounting and financing - Assumed intangible amortization of $50 million - Incremental book interest expe
Slide 13: Ashland EBITDA Transformation
Ashland EBITDA Transformation Enhanced margin performance Pro Forma1 Today1 Ashland Ashland Aqualon Functional Hercules Water Ingredients Technologies 27% 16% Ashland Ashland ISP Ashland Consumer Hercules Water 32% Performance Markets Technologies Materials - 8% 37% 23% Ashland Ashland Consumer Perf
Slide 14: Trademark notices
® Registered trademark, Ashland or its subsidiaries, registered in various countries 14 ™ Trademark, Ashland or its subsidiaries, registered in various countries
Slide 15: Reconciliation of Non-GAAP Data for the 12 Months Ended March 31, 2011
Ashland Inc. and Consolidated Subsidiaries Reconciliation of Non-GAAP Data for the 12 Months Ended March 31, 2011 15 1 Calculation of adjusted EBITDA for each quarter has been reconciled within each quarterly earnings release filed 15 with the SEC and posted on Ashland's website.
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