Koppers Holdings Inc. · NYSE:KOP
Koppers — Non-Deal Roadshow (June 2016)
30 slides from Koppers's roadshow presentation, Jun 27, 2016
Slide 1: Investor Presentation
Investor Presentation New York, Boston & Toronto June 27-29, 2016
Slide 2: Senior Management
) KOPPER “A Hui ( Senior Management
Slide 3: Leroy M. Ball
Leroy M. Ball President and Chief Executive Officer _______________________ 2
Slide 4: Michael J. Zugay
Michael J. Zugay Chief Financial Officer _______________________ 3
Slide 5: Louann Tronsberg-Deihle
Louann Tronsberg-Deihle Treasurer _______________________ 4
Slide 6: Forward Looking Statement
Forward Looking Statement Certain statements in this presentation are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and may include, but are not limited to, statements about sales levels, acquisitions, restructuring, profitability and anticip
Slide 7: Strategic Overview
) S ( KOPPER Strategic Overview
Slide 8: Investment Thesis
Investment Thesis • Transitioning from a business built on producing carbon pitch to serve global aluminum industry into an enterprise centered on wood preservation • Core competency is understanding and knowledge of wood preservation • Global leader in oil and water-borne preservatives serving many
Slide 9: Leading Global Supplier: Infrastructure & Construction Markets
Leading Global Supplier: Infrastructure & Construction Markets Integrated global provider of treated wood products, wood treatment chemicals, and carbon compounds Three core complementary business segments Unique product/service portfolio and niche end market focus 12/31/2015 Net sales $1,627M
Slide 10: Enhanced Business Profile; 2015 Sales Reflect PC Acquisition
Enhanced Business Profile; 2015 Sales Reflect PC Acquisition 2014 Sales by Product 2014 Sales by End Market Railroad Other, 8% Other, 15% Crossties, 22% Rubber, 11% Preservation Chemicals, Railroad, 35% 8% Utilities, 6% $1,555M Creosote/CBF, 17% Carbon Construction, Pitch, 21% 19% $ in millions Alum
Slide 11: Global Presence; Serving Customer Demand
Global Presence; Serving Customer Demand Facilities are well-positioned to capture worldwide growth in demand Europe 2 facilities North America China 17 facilities 3 facilities 2015 Sales by Region Emerging South America Markets 2 facilities(a) 13% Australasia Australasia North 17% 9 facilities Amer
Slide 12: Many Initiatives Underway Aimed at Significantly Improving Profitability
Many Initiatives Underway Aimed at Significantly Improving Profitability Initiative Description • $128M operating cash flow in 2015; all-time high as a public company Aggressively • Reduced debt by $116M in 2015; debt reduction target of $85M in 2016 Targeted Debt Reduction • Total debt was $735 mil
Slide 13: Financial Highlights
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Slide 14: Q1 2016 Sales Reflect CMC Decline; PC Delivered Strong Profitability
Q1 2016 Sales Reflect CMC Decline; PC Delivered Strong Profitability ($ in millions) Sales Bridge Q1 2016 Adjusted EBITDA Bridge Q1 2016 $420 $7 $40 $400 $398 $6 $2 $33 ($7) $0 $30 $27 ($2) $380 $20 $360 $347 ($51) $10 $340 $320 $0 Q1 2015 PC RUPS CMC Q1 2016 Q1 2015 PC RUPS CMC CORP Q1 2016 13
Slide 15: Q1 2016 Highlights
Q1 2016 Highlights Outperformance primarily due to Performance Chemicals (PC) • Experienced unseasonably strong profitability • Benefiting from positive trends in residential remodeling and existing home sales • Mild winter weather in most of U.S. led to higher than typical construction activity Rai
Slide 16: CMC Consolidation Strategy
CMC Consolidation Strategy By 12/31/16, will have shut down coal tar distillation capacity or sold 7 of 11 facilities over 3-year period; already ceased distillation at 5 locations: • Uithoorn, Netherlands stopped producing coal tar products in April 2014 • Follansbee, WV ceased distillation in Dece
Slide 17: 2016 Guidance
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Slide 18: 2016 Sales Forecast of ~$1.5B
2016 Sales Forecast of ~$1.5B ($ in millions) Consolidated Sales Bridge 2016 Forecast $1,700 $25-$35 $1,627 $1,600 ($15-$25) ~$1,500 $1,500 ($100-$125) $1,400 $1,300 $1,200 2015 ACTUAL PC RUPS CMC 2016 FORECAST 17
Slide 19: 2016 EBITDA Forecast: PC Net Improvement of $4-6M
2016 EBITDA Forecast: PC Net Improvement of $4-6M ($ in millions) PC EBITDA Bridge 2016 Forecast $80 $70 $5-$7 $65-$67 $61 ($1) $60 $50 2015 ACTUAL Organic Growth/ Cost FX 2016 FORECAST Savings 18
Slide 20: 2016 EBITDA Forecast: RUPS Slightly Lower Treating Volumes
2016 EBITDA Forecast: RUPS Slightly Lower Treating Volumes ($ in millions) RUPS EBITDA Bridge 2016 Forecast $90 $84 $79-$82 $3 $80 ($2) ($3-$6) $70 $60 $50 2015 ACTUAL Treating Volumes Cost Savings FX 2016 FORECAST 19
Slide 21: 2016 EBITDA Forecast: CMC Increase of $9-$12M
2016 EBITDA Forecast: CMC Increase of $9-$12M ($ in millions) CMC EBITDA Bridge 2016 Forecast $14-$17 $30 $5 $18-$21 $20 $3 ($3) $9 $10 ($10) $0 20
Slide 22: 2016 EBITDA Forecast: Consolidated EBITDA of $160-$168M
2016 EBITDA Forecast: Consolidated EBITDA of $160-$168M ($ in millions) Consolidated EBITDA Bridge 2016 Forecast $160-$168 $170 $9-$12 $2 $160 $4-$6 $150 $150 ($2-$5) $140 $130 $120 2015 ACTUAL PC RUPS CMC CORP 2016 FORECAST 21
Slide 23: Non-GAAP Measures and Guidance
Non-GAAP Measures and Guidance Koppers believes that EBITDA, adjusted EBITDA and adjusted EBITDA margin provide information useful to investors in understanding the underlying operational performance of the company, its business and performance trends and facilitates comparisons between periods and
Slide 24: Debt & Liquidity
) S KOPPER SS} Debt & Liquidity
Slide 25: 2016 Debt Repayment: $85M Minimum Target
2016 Debt Repayment: $85M Minimum Target ($ in millions) Estimated Debt Repayment Year 2016 $750 $735 $10 $160 $700 $650 $650 ($18) $600 $20 ($42) $550 ($45) $500 Total debt TKK loan Adjusted Working Capex Cash Cash taxes Total debt 1/1/2016 repayment EBITDA capital and interest 12/31/2016 other 24
Slide 26: U.S. Credit Facility Amendment
U.S. Credit Facility Amendment Credit amendment (April 2016) provides financial flexibility to fully implement restructuring actions • Reduce revolving credit facility to $300M from $500M; lower revolver interest expense • Increase leverage covenant ratio for each remaining measurement period of agr
Slide 27: Zero Harm
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Slide 28: Zero Harm Safety Statistics
Zero Harm Safety Statistics 2015 2014 2013 2012 Days Away (DA) 1.21 0.76 0.90 0.72 Days Away / Restricted Transfer (DART) 1.90 2.03 1.69 1.66 Total Recordable Rate (TRR) 3.45 3.91 3.71 3.99 Achieved certification in American Chemistry Council’s Responsible Care® initiative across 18 global facilit
Slide 29: Koppers Holdings Inc. Pittsburgh, PA
Koppers Holdings Inc. 436 Seventh Avenue Pittsburgh, PA 15219-1800 Koppers, with corporate headquarters in Pittsburgh, Pennsylvania, is an integrated global provider of treated wood products, wood treatment chemicals and carbon compounds. Our products and services are used in a variety of niche appl
Slide 30: NatureWood Paiva Walkway Pressure Treated Barn with MicroPro
NatureWood Paiva Walkway Pressure Treated Barn with MicroPro Arouca Geopark, Portugal Sienna Color Pigment System - Canada ve oe X “Creating safe & environmentally responsible} solutions: Solving our customers’ “most important challenges: “8 Tae A, Reuting in superior performance for ou Nareholders: