Slide 1: Investor Presentation First Quarter 2021
Investor Presentation First Quarter 2021 1
Slide 2: Legal Notices
Legal Notices Forward-Looking Statements This presentation and the oral remarks made in connection herewith may contain certain forward-looking statements regarding Axalta and its subsidiaries within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, including our guidance, wh
Slide 3: Axalta's Value Proposition
Axalta’s Value Proposition 1 Axalta Profile 2 Evolution of Axalta 3 Diversified Portfolio and Attractive End-Markets 4 Competitive Advantages 5 Investment and Liquidity 6 Current Operating Environment 3
Slide 4: Axalta is a Global Leader
1 Axalta is a Global Leader ▪ #1 or #2 market share in ~90% of markets served Summary Statistics (FY 2020) Net Sales Adj. EBITDA(1) Free Cash Flow(2) ▪ Industry leading margins reflect strength of technology, application know- how, and global brands $3.7bn $760mm $442mm 20% Margin ▪ Premium portfoli
Slide 5: Global Presence
1 Global Presence 13,000 People 46 Manufacturing Sites Darlington Farnham Västervik Zuidland Moscow West Bromwich Fridley Houthwaite Wuppertal Ajax Tewkesbury Guntramsdorf Changchun Cornwall Mt. Clemens Landshut Cerkezkoy Sacramento Montbrison Ft. Madison Orrville Bulle Hilliard Front Royal 53 Jacks
Slide 6: Shareholder Value Creation
1 Shareholder Value Creation Growth Productivity ▪ Technology and innovation ▪ Axalta Way II drivers ▪ Global restructuring ▪ Evolution of culture and ▪ Converting temporary cost incentives savings into structural savings ▪ Clear strategies by end-market with accountability Shareholder Value Creatio
Slide 7: Focus on Productivity, Operating Excellence and Investment
1 Focus on Productivity, Operating Excellence and Investment ▪ Commenced pivot to more business focused structure that will enable us to Organizational Shift further achieve strategic goals ▪ Streamlined organization to provide agility in decision making process ▪ We achieved ~$215 million of tempor
Slide 8: ESG at Axalta
1 ESG at Axalta Environment Social Governance ▪ Global Responsible Care® RC 14001 and ▪ Top-decile safety performance in our ▪ Strong commitment to ethical business ISO 14001 certifications for manufacturing industry conduct; no material compliance issues in sites Axalta history ▪ Programs to suppor
Slide 9: Axalta's Evolution
2 Axalta’s Evolution Road to 2030 Future is Now 2021 Onwards Transformation 2020 Next Chapter… Carve Out 2015 - 2019 Significant Upside COVID-19 Pandemic ▪ Focus on growth Non-Core Division 2013 - 2014 Structure and Agility ▪ White space opportunities in all Public Company ▪ Completed strategic revi
Slide 10: Net Sales Trends
2 Net Sales Trends Net Sales Net Sales by Region ($ in billions) 2013 2020 North North 5.5 APAC APAC (1) America America 15% 14% LatAm 9% 40% 5.0 29% 17% LatAm 4.5 39% 37% 4.0 EMEA EMEA 3.5 Net Sales by End-Market 3.0 2013 2020 Commercial Commercial Refinish 8% 7% Refinish 2.5 Light Light Vehicle Ve
Slide 11: Adjusted EBITDA Trends
2 Adjusted EBITDA Trends Adjusted EBITDA(1) EBITDA Drivers ($ in millions) $937 $939 ▪ Adjusted EBITDA margins increased from 17% in $902 2013 to 20% in 2020 $835 $885 $864 ▪ Pricing and productivity actions positively contributed $733 $760 to margin expansion; Axalta Way created culture of cost dis
Slide 12: Axalta's Diversified Portfolio within Performance Coatings
3 Axalta’s Diversified Portfolio within Performance Coatings Summary Statistics Refinish(1) Industrial(3) ✓ Global leader – #1 player with 25% market ✓ #2 positions globally in Powder and FY 2020 Net Sales share Industrial E-coat $2.5bn Strong record of realizing value through ✓ #2 position in North
Slide 13: Attractive End-Markets: Refinish
3 Attractive End-Markets: Refinish U.S. Body Shop Consolidation China Growth in Mainstream & Tier Cities Body Shop Paint Sales – Axalta has Significant MSO Presence Overall market grew ~5% 2015-20191 (% of Refinish Market) 100% 100% 100% 100% 16% 28% 35% 41% 44% 35% 30% 26% 40% 37% 35% 33% 2013A 201
Slide 14: Attractive End-Markets: Industrial Coatings
3 Attractive End-Markets: Industrial Coatings Industrial Coatings Growth Drivers Industrial Coatings: $42bn market (% of Industrial Coatings Market) ▪ Growth driven by global GDP and industrial production Coil 8% ▪ Many coatings markets are GDP “plus” growers due to coatings use to enhance appearanc
Slide 15: Axalta's Diversified Portfolio within Transportation Coatings
3 Axalta’s Diversified Portfolio within Transportation Coatings Summary Statistics Light Vehicle Commercial Vehicle ✓ #2 Light Vehicle coatings supplier ✓ #1 Heavy Duty Truck (“HDT”) and bus FY 2020 Net Sales coatings supplier $1.2bn ✓ Strong multi-decade customer relationships ✓ IMRONTM is best-in-
Slide 16: Attractive End-Markets: Transportation Coatings
3 Attractive End-Markets: Transportation Coatings $7B ~ $2.5B $700M $600M $500M $450M Total $400M $400M Market ~$13B $200M Body LV Trucks Specialty Bus APC Builders Rail Aviation Marine* OEM MDT / HDT OEM +Trailers Customer Segment Core Developing / Opportunity Source: Orr & Boss, IRFAB, Global Mark
Slide 17: Competitive Advantages
4 Competitive Advantages Trusted Products, Service Superior Technology Aligned With Customer Needs Customer-Focused Innovation Excellence Extensive Design & Go-To-Market Differentiated Technology Product Service Formulation Consumer With Strong Technical Innovation Innovation Innovation Database Pre
Slide 18: Technology Strategy Serves as a Key Differentiator
4 Technology Strategy Serves as a Key Differentiator Leading Technology Organization Leading Technology Investment for Innovation ▪ Focus on color technology, and polymer & formulation chemistry ▪ Roadmaps aligned with businesses ▪ Comprehensive product range of ~27,000 SKUs tailored to customer nee
Slide 19: Free Cash Flow and Capital Deployment
5 Free Cash Flow and Capital Deployment Free Cash Flow Capital Deployment ($ in millions) ($ in millions) (1) (2) Cumulative: $2,236 $599 $794 $399 $444 1. Includes other operating costs for termination benefits and other employee related costs, consulting and advisory fees, transition- related cost
Slide 20: Growth and Diversity from M&A Program
5 Growth and Diversity from M&A Program Track Record of Successful Acquisitions 2015 2016 2017 2018 2019 23 Acquisitions since 2015 Refinish ~$100mm ~$600mm Annual sales added Wood ~$250mm ~$120mm Incremental EBITDA Powder ~$25mm Integrated manufacturing 13 locations Coil ~$85mm General Diversificat
Slide 21: Debt and Liquidity Summary
5 Debt and Liquidity Summary Leverage Trends(1)(2) Interest Coverage (Adj. EBITDA)(3) Cost of Debt(4) Debt Maturity Profile Long term debt interest rates are 89% effectively fixed ▪ Paid down ~$200 million of debt balance with Q4 2020 debt refinancing ▪ Called 2024 EUR & USD Notes (~$900 million USD
Slide 22: Q4 2020 Consolidated Results
6 Q4 2020 Consolidated Results Financial Performance Commentary Q4 % Change ($ in million) 2020 2019 Incl. FX Excl. FX Continued Q4 net sales recovery across most end- Performance 704 730 (3.5)% (6.0)% markets Transportation 371 369 0.5 % 0.4 % ▪ Q4 2020 net sales included sequential quarterly Net S
Slide 23: FY 2020 Consolidated Results
6 FY 2020 Consolidated Results Financial Performance Commentary FY % Change ($ in million) 2020 2019 Incl. FX Excl. FX Net sales dramatically impacted by pandemic Performance 2,516 2,923 (13.9)% (13.7)% effects, but strong recovery after Q2 moderated full Transportation 1,221 1,559 (21.7)% (19.7)% y
Slide 24: Current Operating Environment within Performance Coatings
6 Current Operating Environment within Performance Coatings Performance Market Commentary Refinish ▪ Refinish Q4 net sales posted modest sequential quarterly improvement compared to Q3 despite mid-Q4 impact of restrictions on miles driven ▪ Traffic indicators showing improvement; some negative rever
Slide 25: Current Operating Environment within Transportation Coatings
6 Current Operating Environment within Transportation Coatings Transportation Market Commentary Light Vehicle ▪ Repeated positive industry production forecast revisions since June driven by "V" shaped demand recovery and tight dealer inventories ▪ Global Light Vehicle production increased 3.2% YoY i
Slide 26: Investor Contact
Investor Contact: Chris Mecray - VP, Investor Relations & Treasury christopher.mecray@axalta.com (215) 255-7970 26
Slide 27: Adjusted EBIT Reconciliation
Adjusted EBIT Reconciliation ($ in millions) FY 2020 FY 2019 Q4 2020 Q4 2019 Income from operations $ 306 $ 488 $ 163 $ 109 Other expense (income), net 33 (4) 33 (1) Total $ 272 $ 492 $ 131 $ 110 A Debt extinguishment and refinancing related costs 34 — 32 — B Termination benefits and other employee
Slide 28: Adjusted EBIT Reconciliation (cont'd)
Adjusted EBIT Reconciliation (cont’d) Represents expenses and associated changes to estimates related to the prepayment, restructuring, and refinancing of our indebtedness, which are not considered indicative of our A ongoing operating performance. Represents expenses and associated changes to estim
Slide 29: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation Predecessor Combined Feb-Dec ($ in millions) FY 2020 FY 2019 FY 2018 FY 2017 FY 2016 FY 2015 FY 2014 2013 Jan 2013 FY 2013 Net income (loss) $ 122 $ 253 $ 213 $ 48 $ 45 $ 96 $ 32 $ (222) $ 9 $ (213) Interest expense, net 150 163 160 147 178 197 218 215 — 215 Provision
Slide 30: Adjusted EBITDA Reconciliation (cont'd)
Adjusted EBITDA Reconciliation (cont’d) Represents expenses and associated changes to estimates related to the prepayment, restructuring and refinancing of our indebtedness, including $25 million of commitment fees expensed in 2013 related to A a terminated Bridge Facility in conjunction with the is
Slide 31: Adjusted Net Income Reconciliation
Adjusted Net Income Reconciliation ($ in millions) FY 2020 FY 2019 Q4 2020 Q4 2019 Net Income $ 122 $ 253 $ 70 $ 42 Less: Net income attributable to noncontrolling interests — 4 1 1 Net income attributable to controlling interests 122 249 70 42 A Debt extinguishment and refinancing related costs 34
Slide 32: Adjusted Net Income Reconciliation (cont'd)
Adjusted Net Income Reconciliation (cont’d) Represents expenses and associated changes to estimates related to the prepayment, restructuring, and refinancing of our indebtedness, which are not considered indicative of our A ongoing operating performance. Represents expenses and associated changes to
Slide 33: Free Cash Flow Reconciliation
Free Cash Flow Reconciliation ($ in millions) FY 2020 FY 2019 FY 2018 FY 2017 FY 2016 Cash provided by operating activities $ 509 $ 573 $ 496 $ 540 $ 559 Purchase of property, plant and equipment (82) (113) (143) (125) (136) Interest proceeds on swaps designated as net investment hedges 15 15 9 — —
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