Trinseo PLC · OTC:TSEOQ
Trinseo — Q4 2019 Earnings Presentation
17 slides from Trinseo's earnings presentation, Feb 6, 2020
Slide 1: Fourth Quarter 2019 Financial Results
1 ™ Trademark of Trinseo S.A. or its affiliates ™ Trademark of Trinseo S.A. or its affiliates February 6, 2020 Fourth Quarter 2019 Financial Results
Slide 2: Disclosure Rules: Cautionary Note on Forward-Looking Statements
2 Disclosure Rules Cautionary Note on Forward-Looking Statements. This presentation contains forward-looking statements including, without limitation, statements concerning plans, objectives, goals, projections, strategies, future events or performance, and underlying assumptions and other statement
Slide 3: Achievements in ESG: Environmental, Sustainability, Governance
3 Achievements in ESG: Environmental, Sustainability, Governance • Increased our rating by Carbon Disclosure Program CDP from B- to B. • Silver CSR Rating from Ecovadis for our Corporate Social Responsibility and Sustainability program, placing us in the top quartile of companies assessed by Ecovadi
Slide 4: Highlights
4 *See Appendix for a reconciliation of non-GAAP measures. Highlights • Low styrene margins impacting both the Feedstocks and Americas Styrenics segments • Polystyrene customer destocking due to declining styrene • Unfavorable net timing of $8 million due to declining benzene 2020 Outlook Q4 2019 Re
Slide 5: Trinseo Q4 2019 Financial Results
5 • Net income includes a pre-tax charge of $18 million related to the corporate restructuring program and a tax gain of $24 million primarily from Swiss tax rule changes enacted during 2019 • Operationally, lower profitability due mainly to lower styrene and polycarbonate margins, partially offset
Slide 6: Latex Binders
6 • Lower price due mainly to raw material pass through • Higher sales volume in CASE, carpet, board, and specialty paper offset by decline in graphical paper • Full year sales volume to CASE applications up 14%; significantly higher margin than segment average Latex Binders $219 $255 Q4'19 Q4'18 Ne
Slide 7: Synthetic Rubber
7 • Higher SSBR volume more than offset by lower ESBR volume as weakness in standard tires continues to outweigh resiliency in performance tires • Higher year-over-year earnings from higher fixed cost absorption, favorable net timing, and better mix Synthetic Rubber $100 $130 Q4'19 Q4'18 Net Sales (
Slide 8: Performance Plastics
8 • Volume increase from ABS and compounding growth in Asia partially offset by lower automotive sales in Europe and North America; full year Asia sales volume up 23% • Polycarbonate margins continue to be challenged from low demand and new capacity Performance Plastics $325 $361 Q4'19 Q4'18 Net Sal
Slide 9: Polystyrene
9 • Lower year-over-year net sales from customer destocking, due to styrene price decline, as well as lower pricing from the pass through of lower styrene cost • Full year Adjusted EBITDA 62% above prior year and highest since 2013 due to the implementation of Business Excellence initiatives includi
Slide 10: Feedstocks & Americas Styrenics
10 • Decrease in Adjusted EBITDA due to lower styrene margins in both Europe and Asia Feedstocks & Americas Styrenics ($10) ($7) Q4'19 Q4'18 Adjusted EBITDA ($MM) FEEDSTOCKS • Lower styrene margins in North America leading to earnings decline versus prior year • Q4 dividends of $32.5 million and ful
Slide 11: Europe styrene margins at fundamental support point
11 Europe styrene margins at fundamental support point • More than one-third of global capacity estimated to be operating at or below break-even cash margins • 10% to 15% of global capacity estimated to be currently offline due to unfavorable economics • At least one future capacity expansion has be
Slide 12: 2020 Outlook
12 2020 Outlook Q1 2020 Expectations • Coronavirus impact of $5 million to $10 million • Sequentially lower Europe styrene margins • Americas Styrenics planned outage impacts results by ~ $10 million *See Appendix for a reconciliation of non-GAAP measures. • Business Excellence • Growth in: – SSBR –
Slide 13: Focus on Higher Value Applications
13 Focus on Higher Value Applications • Above applications expected to offer significantly higher growth and margin and are believed to be less cyclical • Recent functional reorganization will enable better focus of efforts and investments on product offerings serving these applications CASE SSBR En
Slide 14: Appendix
& TRINSEO. Appendix
Slide 15: US GAAP to Non-GAAP Reconciliation
15 US GAAP to Non-GAAP Reconciliation NOTE: For definitions of non-GAAP measures refer to the accompanying press release furnished as Exhibit 99.1 to our Form 8-K dated February 6, 2020. Totals may not sum due to rounding. Profitability Outlook Year Ended (In $millions, unless noted) Dec 31, 2020 Ad
Slide 16: US GAAP to Non-GAAP Reconciliation
16 US GAAP to Non-GAAP Reconciliation NOTE: For definitions of non-GAAP measures as well as descriptions of current period reconciling items from Net Income to Adjusted EBITDA and to Adjusted Net Income, refer to the accompanying press release furnished as Exhibit 99.1 to our Form 8-K dated February
Slide 17: Selected Segment Information
17 Selected Segment Information * See this Appendix for a reconciliation of non-GAAP measures. NOTE: Totals may not sum due to rounding. (in $millions, unless noted) Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19 Q4'19 2017 2018 2019 Latex Binders 136 130 135 125 124 131 129 125 1