Ecovyst Inc. · NYSE:ECVT
Ecovyst — Q2 2022 Earnings Presentation
25 slides from Ecovyst's earnings presentation, Jul 29, 2022
Slide 1: Second Quarter 2022
Second Quarter 2022 July 29, 2022—11 am ET YOUR CATALYST FOR POSITIVE CHANGE ™
Slide 2: Legal Discussion
Legal Discussion Continuing Operations Financial results are presented on a continuing operations basis, which excludes the Performance Materials business and Performance Chemicals business unless otherwise indicated. Forward-Looking Statements Some of the information contained in this presentation,
Slide 3: Legal Discussion Continued
Legal Discussion Continued Supply Share and Industry Information Certain statistical information used in this presentation is based on independent industry publications, reports by research firms or other published independent sources. Some statistical information is also based on our good faith est
Slide 4: Key Messages
Key Messages 1 Substantial Q2 2022 Sales and Adjusted EBITDA Growth of 45%1,2 and 38%1,2 Contractual cost pass-through and pricing actions offsetting inflationary 2 pressure Anticipate favorable underlying growth trends and stable outlook for balance 3 of 2022 4 Strong cash generation and balanced c
Slide 5: Delivered Strong Operating and Financial Performance
Delivered Strong Operating and Financial Performance Q2 2022 Key Highlights1,2 45% 38% 80% Sales Growth Adj. EBITDA Growth Cash vs. 20211 vs. 20211,2 Conversion3,4 2.8x #1 or #2 $236 Mln Leverage Ratio5 Supply Share Position Liquidity6 1. Sales change percentage and Adjusted EBITDA percentage change
Slide 6: Demand Fundamentals Remain Favorable
Demand Fundamentals Remain Favorable 2021 Demand Trend Industry End Key Total Growth 2022 Anticipated Demand Drivers Use Products Q2’22 Q3’22E Sales Rate Vs Q1’22 vs Q2’22 Regeneration CLEAN FUELS Rebounding gasoline demand and exports For Alkylation ~32% ~4% Increasing U.S. refinery utilization to
Slide 7: Well Positioned for Future Growth - Meeting Industry Needs for Sustainable Technologies
Well Positioned for Future Growth - Meeting Industry Needs for Sustainable Technologies % of R&D Spend On • 75% of current end use sales address customer and consumer Green Technologies demand for more sustainable products and services ~80% ~90% More than 80% of innovation investment focused on prod
Slide 8: Second Quarter 2022 Financial Performance
Second Quarter 2022 Financial Performance
Slide 9: Financial Performance – Q2 2022
Financial Performance – Q2 2022 Second Quarter Financial Results Second Second Quarter Quarter $ % ($ in millions) 2022 2021 Change Change Ecovyst Sales 225.2 147.0 78.2 53.2 Zeolyst JV Sales 35.9 33.2 2.7 8.2 Adjusted EBITDA1 72.9 52.7 20.2 38.3 Adjusted EBITDA Margin1,2 (%) 27.9 29.3 (140 bps) $ %
Slide 10: Adjusted EBITDA Bridge – Q2 2022
Adjusted EBITDA Bridge – Q2 2022 Ecoservices unit margins expanded with contractual cost pass-through and Catalyst Technologies margins stable with strong pricing power Positive price-cost Adjusted 27.9%1,2 EBITDA Impact ($MM) 29.3%1,2 1. See Appendix for Reconciliations of non-GAAP measures. 2. Adj
Slide 11: Ecoservices - Q2 2022 Financial Performance
Ecoservices - Q2 2022 Financial Performance Second Second Quarter Quarter $ % ($ in millions) 2022 2021 Change Change Ecoservices Sales 193.0 120.8 72.2 59.8 Adjusted EBITDA1 60.0 40.5 19.5 48.1 Adjusted EBITDA Margin1 (%) 31.1 33.5 (240 bps) Ecoservices Highlights • Strong demand for virgin sulfuri
Slide 12: Catalyst Technologies – Q2 2022 Financial Performance
Catalyst Technologies – Q2 2022 Financial Performance Second Second Quarter Quarter $ % ($ in millions) 2022 2021 Change Change Silica Catalysts Sales 32.2 26.2 6.0 22.9 Zeolyst JV Sales 35.9 33.2 2.7 8.2 Adjusted EBITDA1 21.4 20.7 0.7 3.4 Adjusted EBITDA Margin1,2 (%) 31.4 34.9 (350 bps) Catalyst T
Slide 13: Leverage & Liquidity
Leverage & Liquidity Net Leverage Ratio1 Liquidity2 ($ Millions) 3.8x $236 3.3x $203 $207 3.1x 2.8x $165 Q3-2021 Q4-2021 Q1-2022 Q2-2022 Q3-2021 Q4-2021 Q1-2022 Q2-2022 Leverage Ratio Liquidity • Strong cash generation has provided for • 43% increase in Liquidity since Q3 2021 leverage reduction of
Slide 14: Balanced Capital Allocation Strategy to Support Growth Initiatives and Drive Shareholder Return
Balanced Capital Allocation Strategy to Support Growth Initiatives and Drive Shareholder Return Strong free cash flow generation provides financial flexibility and supports a balanced capital allocation strategy focused on: Cash Flow from Operations • Operational improvements & organic growth Less:
Slide 15: Ecovyst 2022 Outlook
Ecovyst 2022 Outlook Ecovyst1 Q1 2022 Q2 2022 ($ in millions, 2021 Prior Updated except per share) Actual Guidance Outlook Sales2 $611 $810 -$830 $830 -$850 Adjusted EBITDA Growth of 19% Zeolyst JV Sales $131 $150 – $160 $135 – $145 In 2022 from 2021 Assuming midpoint of guidance Adjusted EBITDA3 $2
Slide 16: Summary
Summary 1 Positive demand trends expected to continue in second half of 2022 Leadership positions, longstanding customer relationships and order backlog 2 provide good near-term visibility Mitigating inflationary pressures through contractual cost pass-through and 3 pricing actions 4 Well-positioned
Slide 17: Appendix
APPENDIX
Slide 18: Ecoservices: North American Leader in Sulfuric Acid Recycling and Related Services
Ecoservices: North American Leader in Sulfuric Acid Recycling and Related Services with Key Competitive Position in Gulf Coast and California NEAR-TERM GROWTH FACTORS • Existing customer re-contracting, and favorable alkylate fundamentals expected to drive growth for regeneration services • Rising v
Slide 19: Catalyst Technologies: Global Leader in Tailored Catalyst Solutions
Catalyst Technologies: Global Leader in Tailored Catalyst Solutions NEAR-TERM GROWTH FACTORS • Preferred technology and increasing product offerings for strengthening & light weighting of materials projected to drive growth in polyethylene catalysts • Growing demand for renewable fuels • Increasing
Slide 20: Quarterly Segment Sales, Adjusted EBITDA and Margins
Quarterly Segment Sales, Adjusted EBITDA and Margins Six Months Six Months Three Months Ended Ended Three Months Ended Ended ($ in millions, except %) March 31, 2022 June 30, 2022 June 30, 2022 March 31, 2021 June 30, 2021 June 30, 2021 Sales: Ecoservices 154.0 193.0 347.0 100.2 120.8 221.0 Silica C
Slide 21: Sales and Adjusted EBITDA Major Change Factors
Sales and Adjusted EBITDA Major Change Factors Sales Three Months Ended June 30, 2022 Six Months Ended June 30, 2022 Sales Silica Silica (in $ millions and %) Ecovyst Ecoservices Catalysts Ecovyst Ecoservices Catalysts Sales: $ % $ % $ % $ % $ % $ % Volume 19.6 13.3 16.2 13.4 3.4 13.0 33.5 12.2 32.8
Slide 22: Reconciliation of Net (Loss) Income to Segment Adjusted EBITDA
Reconciliation of Net (Loss) Income to Segment Adjusted EBITDA Six Months Six Months Three Months Ended Ended Three Months Ended Ended ($ in millions, except %) March 31, 2022 June 30, 2022 June 30, 2022 March 31, 2021 June 30, 2021 June 30, 2021 Reconciliation of net income (loss) from continuing o
Slide 23: Adjusted Free Cash Flow
Adjusted Free Cash Flow Full Year Six months ended ($ in millions) 20211 June 30, 2022 Cash flow from Operations before interest and tax 200.7 88.4 Less: Cash paid for taxes 11.8 19.8 Less: Cash paid for interest2 59.0 15.8 Cash Flow from Operations 129.9 52.8 Less: Purchases of property, plant and
Slide 24: Descriptions for Reconciliation of Non-GAAP Financial Measures
Descriptions for Reconciliation of Non-GAAP Financial Measures a) We use Adjusted EBITDA as a performance measure to evaluate our financial results. Because the Catalyst Technologies segment includes our 50% interest in the Zeolyst Joint Venture, we include an adjustment for our 50% proportionate sh
Slide 25: Growing + Greening
Growing + Greening YOUR CATALYST FOR POSITIVE CHANGE ™