Slide 1: 2Q 2024 Earnings Presentation
August 2, 2024 2Q 2024 Earnings Presentation
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 Operational Performance and Captured Commercial Tailwinds Drive Robust 2Q24 Performance 2Q24 Sales ✓ Strong Sales, Earnings, Margin Rate and Cash Flow Results – 2Q24 Net Income of $39M, Cash Flow from Operations of $50M $453M – 6% improvement in sales reflecting higher domestic nylon volume
Slide 4: 2Q 2024 Financial Summary
2Q 2024 Financial Summary Year-Over-Year Improvement in Sales, Earnings and Cash Flow ($M, except per share amounts) Sales Adjusted EBITDA Adjusted Diluted EPS Free Cash Flow +6% +19% +24% +6% $78 $428 $453 $66 $1.55 $16 $17 $1.25 2Q23 2Q24 2Q23 2Q24 2Q23 2Q24 2Q23 2Q24 Adjusted 15.4% 17.2% Net Inco
Slide 5: 2Q 2024 Adjusted EBITDA Sequential Bridge
2Q 2024 Adjusted EBITDA Sequential Bridge Improved Sequential Pricing and Volume, Return to Targeted Utilization Rates ($M) $10 • Strong operational $21 performance and lower plant spend • Higher sales volume driven $78 $19 by: - Strong in-season demand amid tight North American • Ammonium Sulfate s
Slide 6: Industry Pricing and Spreads
Industry Pricing and Spreads Nylon Ammonium Sulfate Chemical Intermediates Global Pricing Stable Sequentially Strong In-Season Demand and Ammonium Sulfate Tight Global Acetone Supply and Demand Pricing 2400 ($/ston N 1200 80 (cents per 1200 ($/MT) content basis) pound) 1000 2000 1000 60 800 1600 800
Slide 7: Plant Nutrients Update
Plant Nutrients Update Fundamentals Remain Strong With Tight North American Supply / Demand Supporting Favorable Outlook Ammonium Sulfate Spreads Market Dynamics • Strong in-season demand and strengthening Ammonium Sulfate pricing into 2Q24 – Ammonium sulfate pricing has trended more favorable compa
Slide 8: Chemical Intermediates (CI) Update
Chemical Intermediates (CI) Update Continued Favorable Outlook Acetone Spreads Market Dynamics • Acetone pricing and margins near historical highs amid tight global supply and demand conditions • Global phenol operating rates remain depressed driven by continued softness in building and construction
Slide 9: Nylon Solutions Update
Nylon Solutions Update Tighter North American Supply / Demand Supporting Domestic Improvement Nylon Spreads Market Dynamics • Operating in third Nylon industry cycle since spin – Global industry spreads bouncing off prior trough levels – Operating rates in China at multi-year highs despite slower gl
Slide 10: Capital Allocation Framework
Capital Allocation Framework Disciplined Capital Deployment to Support Long-Term Shareholder Value Capital Allocation Framework Capital Allocation (2017-2Q24) ($M) • Base Capex including maintenance and ~$1.2B ~$1.1B HSE* spend to support safe, stable and sustainable operations 107 Acquisitions Crit
Slide 11: Well Positioned To Deliver Attractive Returns Over Long-Term as a Diversified Chemistry Company
Well Positioned To Deliver Attractive Returns Over Long-Term as a Diversified Chemistry Company Growth Strategy & Investment Thesis Return on Invested Capital (ROIC) • Advantaged Business Model Supports Strong Operating Generating strong returns on capital investments Leverage o Integrated, efficien
Slide 12: Appendix
AovaNSix APPENDIX Good chemistry,
Slide 13: 2H 2024 Outlook Considerations
2H 2024 Outlook Considerations Performance Across Diversified Portfolio Supports Favorable Earnings Outlook Tailwinds Neutral Headwinds • Tighter domestic supply and • Stable nylon outlook on tighter • Soft demand persists in building higher ammonium sulfate pricing North American supply with and co
Slide 14: Planned Plant Turnarounds
Planned Plant Turnarounds Pre-Tax Income Impact by Quarter (1) Primary Unit 1Q 2Q 3Q 4Q FY Operation 2017 -- ~$10M ~$4M ~$20M ~$34M Sulfuric Acid • Timing driven by compliance, inspection and 2018 ~$2M ~$10M ~$30M -- ~$42M Ammonia sustaining asset base 2019 -- ~$5M ~$5M ~$25M ~$35M Sulfuric Acid • C
Slide 15: Reconciliation of Non-GAAP Measures to GAAP Measures
Reconciliation of Non-GAAP Measures to GAAP Measures
Slide 16: Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow
Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow (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 The Company believes that this metric is useful to investor
Slide 17: Reconciliation of Net Income to Adjusted EBITDA
Reconciliation of Net Income to Adjusted EBITDA (in $ thousands) (2) Includes a pre-tax loss of approximately $1.2 million related to the reduction of the Company’s anticipated receivable related to the gain on the termination fee recorded upon the exit from the Oben alliance during the third quarte
Slide 18: 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