Eastman Chemical Company · NYSE:EMN
Eastman Chemical — Q1 2024 Earnings Presentation
15 slides from Eastman Chemical's earnings presentation, Apr 26, 2024
Slide 1: 1Q 2024 financial results
1Q 2024 financial results April 25, 2024
Slide 2: Prepared remarks, forward-looking statements, non-GAAP financial measures
Prepared remarks These slides should be reviewed with the accompanying prepared remarks posted on our website. Forward-looking statements This information and other statements by the company may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act wit
Slide 3: 1Q 2024 highlights
1Q 2024 highlights • Strong sequential increase in sales volume/mix and earnings driven by specialty products in Advanced Materials and Additives & Functional Products • Achieved on spec production and revenue generation at our Kingsport methanolysis facility • Pathway to deliver ~$75 million of inc
Slide 4: Celebrating the startup of the world's largest chemical recycling facility
Celebrating the startup of the world’s largest chemical recycling facility • Safe and successful startup enabled by hundreds of dedicated Eastman employees and the support of their families • On spec production and revenue generation began in March 2024 • Making progress with ramp-up of utilization
Slide 5: Longview, Texas selected as the location of our second U.S.-based methanolysis facility
Longview, Texas selected as the location of our second U.S.-based methanolysis facility Circular economy Polyester recycling facility polymerization • U.S. Department of Energy selected Longview, Mixed plastic facility processing TX project for investment of up to $375 million • Significant carbon i
Slide 6: Corporate
Corporate $M (except EPS) 1Q24 1Q23 4Q23 1Q24 vs. 1Q23 highlights Revenue 2,310 2,412 2,207 Adjusted EBIT 274 283 222 • Higher sales volume/mix due to reduced levels Adjusted EBIT margin 11.9% 11.7% 10.1% of customer inventory destocking led by Adjusted EPS 1.61 1.63 1.31 consumer durables • Improve
Slide 7: Advanced Materials
Advanced Materials $M (except EPS) 1Q24 1Q23 4Q23 1Q24 vs. 1Q23 highlights Revenue 748 742 705 • Higher sales volume/mix driven by reduced levels of customer inventory destocking in specialty plastics, Adjusted EBIT 104 86 65 except in medical Adjusted EBIT margin 13.9% 11.6% 9.2% • Strong growth in
Slide 8: Additives & Functional Products
Additives & Functional Products $M (except EPS) 1Q24 1Q23 4Q23 1Q24 vs. 1Q23 highlights Revenue 704 777 640 • Growth in coatings additives and care additives Adjusted EBIT 109 124 67 • Favorable price-cost Adjusted EBIT margin 15.5% 16.0% 10.5% • Unfavorable timing of heat transfer fluid project ful
Slide 9: Fibers
Fibers $M (except EPS) 1Q24 1Q23 4Q23 1Q24 vs. 1Q23 highlights Revenue 331 303 346 • Strong growth in textiles driven by adoption of Adjusted EBIT 117 94 113 Naia sustainable textile products as customers Adjusted EBIT margin 35.3% 31.0% 32.7% prioritize sustainability in addition to functionality R
Slide 10: Chemical Intermediates
Chemical Intermediates $M (except EPS) 1Q24 1Q23 4Q23 1Q24 vs. 1Q23 highlights Revenue 523 589 513 • Lower spreads due to lower selling prices across the Adjusted EBIT 16 42 24 segment resulting from lower raw material prices and weak end-market demand Adjusted EBIT margin 3.1% 7.1% 4.7% • Higher sa
Slide 11: Cash flow and other financial highlights
Cash flow and other financial highlights Resilient cash flow Balance sheet and tax rate Well positioned with solid FY24 forecasted Forecasted FY24 operating cash flow Expect normal cash seasonality with investment-grade adjusted effective tax rate approximately typical 2H weighting balance sheet 15-
Slide 12: 2024 end-market outlook
2024 end-market outlook End market 2Q24 sequential FY24 vs FY23 Transportation • Projecting slight increase in auto OEM • Projecting flat global OEM production (~18% of corporate revenue) production • EMN outperforming the market due to • EMN outperforming the market due to innovation-driven leverag
Slide 13: 2024 outlook
2024 outlook Tailwinds vs FY2023 Headwinds/Uncertainties vs FY2023 • Specialty volume and mix improvement • Lower price/cost negatively impacting margins, • Absence of significant customer inventory primarily in Chemical Intermediates destocking in most end markets • Higher costs related to investme
Slide 14: Appendix
Appendix 14
Slide 15: Underlying assumptions and modeling items for FY2024
Underlying assumptions and modeling items for FY2024 Updated • Interest expense of ~$205 million; previously ~$215 million • Capital expenditures ~$700 - $750 million; previously less than $800 million • Share repurchases $200 - $300 million; previously higher levels vs FY2023 • Corporate ‘Other’ ad
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