Air Products And Chemicals, Inc. · NYSE:APD
Air Products And Chemicals — Merger or Acquisition (December 2015)
22 slides from Air Products And Chemicals's merger presentation, Dec 18, 2015
Slide 1: Create Shareholder Value: Separation of Materials Technologies
Exhibit 99.1 Moving forward Create Shareholder Value Separation of Materials Technologies Versum Materials – Form 10 Highlights December 2015
Slide 2: Forward-looking statements
Moving forward Forward-looking statements This presentation and materials Air Products and Versum have filed or will file with the SEC contain, or will contain, certain statements regarding business strategies, market potential, future financial performance, future action, results and other matters
Slide 3: Air Products intends to separate Materials Technologies through a tax-free spin-off
Moving forward Air Products intends to separate our Materials Technologies business (Versum Materials*) through a tax-free spin-off • Decision to separate is strategic: allows the industrial gases and materials businesses to leverage their respective critical competencies and enhance competitive pos
Slide 4: Tailored capital structures with financial flexibility to drive value creation
Moving forward Tailored capital structures with financial flexibility to drive value creation • Air Products expects to manage its balance sheet to maintain its current targeted A/A2 rating - Transaction is expected to create approximately $1.5 billion of additional capital deployment capacity for A
Slide 5: Strategic rationale for separation
Moving forward Strategic rationale for separation Creates two focused, best-in-class public companies with distinct business models, capital requirements and growth profiles Air Products – Industrial Gases Versum Materials • Gases • Specialty Materials Business • Engineered solutions • Innovation so
Slide 6: Creation of two companies with strong financial profiles
Moving forward Creation of two companies with strong financial profiles ($ millions, FY15) Current Air Products, Materials Air Products ex MT Technologies Sales $9,895 $7,808 $2,087 Adjusted EBITDA / $2,975 $2,403 $572 Margin* 30.1% 30.8% 27.4% Operating Income / $1,884 $1,407 $477 Margin* 19.0% 18.
Slide 7: Versum Materials / Form 10
Versum Materials / Form 10
Slide 8: Versum Materials: A portfolio of world class businesses
Moving forward Versum Materials A portfolio of world class businesses Sales: $2,096 Europe Adj EBITDA*:$534 17% Margin: 25.5% Americas Electronic Performance 40% Materials Materials 48% 52% Asia 43% Sales by business segment and destination • Leading positions in attractive niche markets with favora
Slide 9: Electronic Materials
Moving forward Electronic Materials A portfolio of world class businesses Europe Sales: $1,009 9% Delivery Adj EBITDA*:$324 Systems Advanced Americas Materials Margin: 32.1% 30% 26% 35% Process Asia Materials 61% 39% Sales by business unit and destination • Integrated provider of specialty materials
Slide 10: Performance Materials
Moving forward Performance Materials A portfolio of world class businesses Specialty Sales: $1,078 Europe Additives Adj EBITDA*:$242 24% Curing Margin: 22.4% 28% Agents Americas 40% 50% Asia Polyurethane 26% Additives 32% Sales by business unit and destination • Focused on the $10 billion high value
Slide 11: Three Financial Reports
Moving forward Three Financial Reports “Materials Technologies Segment” • As previously reported by Air Products with MT as a segment within Air Products, not full financial statements “Versum Audited Carve-out Financials” • Full financial statements, provided in the “Financial Statements” section o
Slide 12: Versum vs Materials Technologies
Moving forward Versum vs Materials Technologies FY15 Versum MT Delta Sales $ 2,096 $ 2,087 $ 9 Adj Operating Income* $ 447 $ 477 $ (30) Op Margin 21.3% 22.8% -150bp D&A $ 85 $ 93 $ (8) Adj EBITDA* $ 534 $ 572 $ (38) EBITDA Margin 25.5% 27.4% -190bp • Versum Carve-out Form 10 Financials includes; - A
Slide 13: Versum Carve-out - Form 10
Moving forward Versum Carve-out - Form 10 FY15 improvement driven by improved pricing/mix, higher volumes and lower costs offsetting unfavorable currency FY13 FY14 FY15 Sales $ 1,879 $ 2,075 $ 2,096 Adj Operating Income* $ 248 $ 349 $ 447 Op Margin 13.2% 16.8% 21.3% Adj EBITDA* $ 339 $ 437 $ 534 EBI
Slide 14: Significant Cash Generation
Moving forward Significant Cash Generation ($ million) Adj EBITDA $534 Est. Interest (150) Est. Cash Taxes (85) Est. Maint Capex (30) Est. Distributable Cash Flow $270 Est. Growth Capex (40) Est. Free Cash Flow (before divs) $230 Note • Adj EBITDA = FY15 Versum Carve-out, non-GAAP – see appendix for
Slide 15: Electronic Materials
Moving forward Electronic Materials FY15 improvement driven by improved pricing/mix, higher volumes and lower costs offsetting unfavorable currency EM FY13 FY14 FY15 Sales $ 853 $ 943 $ 1,009 Adj Operating Income* $ 106 $ 185 $ 266 Op Margin 12.5% 19.6% 26.3% Adj EBITDA* $ 171 $ 246 $ 324 EBITDA Mar
Slide 16: Performance Materials
Moving forward Performance Materials FY15 improvement driven by improved pricing/mix, lower costs and higher volumes offsetting unfavorable currency PM FY13 FY14 FY15 Sales $ 1,017 $ 1,123 $ 1,078 Adj Operating Income* $ 176 $ 197 $ 214 Op Margin 17.3% 17.6% 19.8% Adj EBITDA* $ 203 $ 224 $ 242 EBITD
Slide 17: Additional Items #1
Moving forward Additional Items - #1 • Corporate Segment - Administrative costs that have been allocated to us as an estimate of the costs associated with operating a public company, non-core operating activities such as remediation of historical environmental sites, foreign exchange gains and losse
Slide 18: Additional Items #2
Moving forward Additional Items - #2 • Capex - Averaged $70 million over last three years ($100 FY15, $59 FY14, $49 FY13). The FY15 increase was primarily due to spending for new production capacity for the Performance Materials segment. - For fiscal 2017, we expect capital spending to be lower due
Slide 19: Leadership
Moving forward Leadership Seifollah Ghasemi Director and non-executive Chairman Guillermo Novo President and Chief Executive Officer and Director George Bitto Senior Vice President and Chief Financial Officer Patrick F. Loughlin Senior Vice President Operations and Supply Chain Michael W. Valente Se
Slide 20: Appendix Slides
Appendix Slides
Slide 21: Appendix: Non GAAP Operating Income and EBITDA Metrics
Moving forward Appendix: Non GAAP Operating Income and EBITDA Metrics $MM FY15 Versum Current Air Materials Air Products, Products Technologies ex MT * FY13 FY14 FY15 Operating Income/Margin GAAP Measure Sales 9,894.9 2,087.1 7,807.8 1,879.0 2,075.3 2,096.4 Operating Income 1,699.1 476.7 1,222.4 110
Slide 22: Thank you
Moving forward Thank you tell me more
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