Ashland Inc. · NYSE:ASH
Ashland — Q1 2025 Earnings Presentation
39 slides from Ashland's earnings presentation, Jan 29, 2025
Slide 1: Earnings conference call first quarter fiscal 2025
earnings conference call first quarter fiscal 2025 January 29, 2025 7 HgTe ~ oo ae\ _) ‘a Loc Ashland always solving
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, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Ashland has identified some of these forward-looking statements with words
Slide 3: Agenda
Q1 performance summary Q1 financial results & business unit reviews strategic priorities & outlook closing comments Q&A *T Ashland always solving
Slide 4: always solving
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Slide 5: Q1 highlights
Q1 highlights! adjusted EPS? reduced income from continuing operations; 3.0 million shares repurchased in LTM 1 Comparisons versus prioryear quarter. All figures are presented on an adjusted basis except Sales. Appendix 8 reconciles adjusted amounts to amounts reported under GAAP, including reconcil
Slide 6: Seizing opportunities in uncertain markets
seizing opportunities in uncertain markets — mixed sales & momentum on ‘execute’ strategy consistent adj. EBITDA margin’ despite proactive turnarounds [EEE 5210s comporsons versus proryeor quarter [ERR] comparisons versus priotyeor quarter sales comparisons versus reset prioryeor quarter ‘comparison
Slide 7: Q1 financial results and business unit reviews
Q Q Q Q Q Q O O O O O O ( Q1 financial results and business unit reviews oe . = \/Ashland
Slide 8: Ashland adjusted results summary
Ashland adjusted results summary! Sales $405 gross profit margin 28.1% SG8A / R&D costs / intangible amortization $104 operating income sn EBITDA $61 EBITDA margin 15.1% EPS (excluding acquisition amortization? $0.28 Appendix fom continuing oper sma <P Ashland always solving rations,
Slide 9: Life Sciences adjusted and reset results summary
adjusted results summary’ reset results? highlights o EMEA pharma market softer & customer inventory control sales $134 $200 (33) % o strong growth in globalize business lines (injectables & gross profit $43 $63 (82) % OSD film coatings) gross profit margin 32.1% 31.5 % o lower pharma pricing from c
Slide 10: Intermediates highlights and adjusted results summary
highlights © captive: volume relatively stable © merchant: higher NMP volume & broadly lower pricing o unfavorable product mix; large volume customers o production recovery adjusted results summary’ sales S38 S38 gross profit $5 So gross profit margin 15.2% 27.3% operating income $3 $7 EBITDA $6 $10
Slide 11: Personal Care adjusted results summary
adjusted results summary’ sales $134 gross profit $48 gross profit margin 35.8 % operating income $12 EBITDA $30 EBITDA margin 22.4% * Ashland always solving
Slide 12: Specialty additives
specialty additives high | ights adjusted results summary’ reset results? (SUS in millions, except percentages) QI FY25 QI FY24 change QI FY24 change mand stable; pri market dynamics sales $5 gross profit $18 $9 gross profit margin 15.7 % 74% operating income ($3) ($11) EBITDA $13 $6 EBITDA margin 1
Slide 13: Strong balance sheet & capital allocation strategy
strong balance sheet & capital allocation strategy strong balance sheet and balanced capital allocation annual dividend? increase every year since 2009 strong balance sheet! © cash and liquidity available of ~$0.8 billion o net debt of $1,094 million; net leverage of 2.4x © no long-term debt maturit
Slide 14: Strategic priorities and outlook
Q Q Q Q Q Q O O O O O O ( Guillermo Novo, Chair and CEO strategic priorities and outlook a A/ Ashland always solving
Slide 15: Portfolio optimization update
portfolio optimization update final stages of portfolio optimization * pending sale of avoca * $30MM restructuring to offset stranded cost & lost gross profit * FY25 outlook includes $15MM headwind o (S80MM)! in lost gross profit & stranded cost o +$15MM restructuring realization; FY26 carry-over bp
Slide 16: Execute
execute business unit focus enterprise focus sustainably shaping and growing the portfolio *\/ Ashland always solving
Slide 17: ~$90 MM EBITDA impact: reset cost structure
~$90 MM EBITDA impact1 — reset cost structure and eliminate stranded cost strengthen HEC & VP&D competitive position; enable share gains 17
Slide 18: On track: ~$100 MM revenue impact
— ~$100 MM on track ~$100 MM on track revenue impact1 revenue impact1 18
Slide 19: Reiterating FY25 outlook
reiterating FY25 outlook forward looking insights risks and opportunities fiscal full-year outlook market conditions + European & Chinese economic sales $1.90 — $2.05 billion Adj. EBITDA $430 - $470 million * weaker European demand recovery * China down, in-line with expectations oo - * continued ag
Slide 20: Closing comments
Q Q Q Q Q Q O O O O O O ( Guillermo Novo, Chair and CEO closing comments oe . = \/Ashland
Slide 21: EBITDA CAGR
— ~12% EBITDA CAGR 21 2024 financials adjusted for portfolio reset. Portfolio reset items: nutraceuticals, CMC, MC portfolio optimization actions. See appendix A and B for additional detail 1
Slide 22: Thank you, Q&A
thank you Q&A *<f Ashland 22 always solving
Slide 23: Appendix A: adjusted results summary and balance sheet
appendix A: adjusted results summary and balance sheet *<f Ashland always solving
Slide 24: Sales reset detail
sales reset detail sales life personal specialty (SUS in millions) FY 2024 reported portfolio reset impact! FY 2024 portfolio reset avoca sale or exit FY 2024 portfolio reset with avoca sciences care additives intermediates total $97 $2,113 - (164) 97 1,949 - (55) $97 $1,894 portfolio optimization i
Slide 25: Adjusted results by business unit
— 25 3. Calculation of adjusted EBITDA for each period presented have been reconciled within certain financial filings with the SEC and posted on Ashland's website for each reportable segment.
Slide 26: Adjusted results notes
— 1 All figures are presented on an adjusted basis except Sales and Diluted share count (million shares). Appendix B reconciles adjusted amounts to amounts reported under GAAP, including reconciliations of net income to EBITDA and adjusted EBITDA, operating income to adjusted operating income, incom
Slide 27: Q1 business unit consolidation
Q1 business unit consolidation! a specialty intercompany unallocated eben cee a em} —_ gross profit $4 EBITDA (S16) 1 Allfigures are presented on an adjusted basis except Sales. Appendix B reconciles adjusted amounts to amounts reported under GAAP, including reconciliations of net income to EBITDA a
Slide 28: Liquidity and net debt
liquidity and net debt (SUS in millions) expiration interest rate mood S&P rating 12/31/24 rating balance revolver availability 596 US and foreign A/R sales program! debt 3.375% notes Sept. 2031 3.375% 6.50% junior subordinated notes Jun, 2029 6.500% total debt Ba1/stable BB+/stable $1,313 net debt
Slide 29: Non-GAAP forward-looking guidance note
Although Ashland provides forw : : guidance for US. GAAP reported financial measur oking omparable U.S. GAAP measure unable to predict with rea ble effort. *<f Ashland always solving
Slide 30: Reconciliation of Non-GAAP Data
Ashland Inc. and Consolidated Subsidiaries Reconciliation of Non-GAAP Data for the 12 Months Ended December 31, 2024 — 30 1 Quarterly totals may not add to annual amounts due to rounding. Calculation of adjusted EBITDA for each period presented have been reconciled within certain financial filings w
Slide 31: Segment components of key items, Dec 2024
Ashland Inc. and Consolidated Subsidiaries Segment Components of Key Items for Applicable Income Statement Captions — for the 3 months ended December 31, 2024 In millions - preliminary and unaudited Three Months Ended December 31, 2024 (Smilions) Specialty Unallocated Life Sciences Personal Care __A
Slide 32: Segment components of key items, Dec 2023
Ashland Inc. and Consolidated Subsidiaries Segment Components of Key Items for Applicable Income Statement Captions — for the 3 months ended December 31, 2023 In millions - preliminary and unaudited Three Months Ended December 31, 2023 (fmmons) Specialty Unallocated Life Sciences Personal Care Addit
Slide 33: Free Cash Flow and Adjusted Operating Income
Ashland Inc. and Consolidated Subsidiaries Reconciliation of Non-GAAP Data — Free Cash Flow and Adjusted Operating Income for the 3 Months Ended December 31, 2024 and 2023 Three months ended ——= December 31 ay Free cash flows aa (S millions) | [cam fowe eich hed by oparaingceTTes TomommnG ATOR mo So
Slide 34: Adjusted EBITDA reconciliation
Ashland Inc. Reconciliation of Non-GAAP Data — Adjusted EBITDA for the 3 Months Ended December 31, 2024 and 2023 (S millions) Three months ended December 31 Adjusted EBITDA - Ashland Inc. 2024 2023 Net income (loss) $ (165) $§ 26 Income tax benefit (43) (24) Net interest and other expense (income) 2
Slide 35: Life Sciences and Personal Care adjusted EBITDA
Life Sciences and Personal Care Reconciliation of Non-GAAP Data — Adjusted EBITDA for the 3 Months Ended December 31, 2024 and 2023 ($ millions) Three months ended December 31 2024 2023 Adjusted EBITDA - Life Sciences Operating income $ 4 68 32 Add: Depreciation and amortization 14 16 Adjusted EBITD
Slide 36: Specialty Additives and Intermediates adjusted EBITDA
Specialties Additives and Intermediates Reconciliation of Non-GAAP Data — Adjusted EBITDA for the 3 Months Ended December 31, 2024 and 2023 Three months ended ($ millions) December 31 Adjusted EBITDA - Specialty Additives — 2024 __ 2023 Operating loss S$ 6) $ (32) Add: Depreciation and amortization
Slide 37: Tax effect and amortization footnotes
— ($ millions) (a ) Re p re se nts the ta x e ffe c t o f the ke y ite ms tha t a re p re vio usly id e ntifie d a b o ve (b ) Re p re se nts ke y ite ms re sulting fro m ta x-sp e c ific fina nc ia l tra nsa c tio ns, ta x la w c ha ng e s o r o the r ma tte rs tha t fa ll within the d e finitio n
Slide 38: Adjusted Diluted EPS from Continuing Operations
Ashland Inc. and Consolidated Subsidiaries Reconciliation of Non-GAAP Data — Adjusted Diluted EPS from Continuing Operations Three months enced for the 3 Months Ended December 31, 2024 and 2023 December 31 — 2024 2023 @s) S$ 054 Diluted EPS from continuing operations (as reported) Key items, before
Slide 39: Ashland
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