Avient Corporation · NYSE:AVNT
Avient — PolyOne — Bank of America Merrill Lynch 2013 US Basic Materials Conference
18 slides from Avient's conference presentation, Dec 11, 2013
Slide 1: PolyOne Investor Presentation
PolyOne Investor Presentation Bank of America Merrill Lynch 2013 US Basic Materials Conference December 11, 2013
Slide 2: Forward-Looking Statements
Forward – Looking Statements • In this presentation, statements that are not reported financial results or other historical information are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements give current expectations or
Slide 3: Use of Non-GAAP Measures
Use of Non-GAAP Measures • This presentation includes the use of both GAAP (generally accepted accounting principles) and non-GAAP financial measures. The non-GAAP financial measures include: adjusted EPS, earnings before interest, tax, depreciation and amortization (EBITDA), adjusted EBITDA, net de
Slide 4: Strategy and Execution Drive Results
Strategy and Execution Drive Results All time high of • 16 consecutive quarters of 350.00% $34.47 double digit EPS growth December 9th, 2013 250.00% • 42% CAGR adjusted EPS expansion 2006-2012 150.00% 50.00% • YTD stock price has increased 63% versus 27% growth in the S&P -50.00% -150.00% • More tha
Slide 5: Four Pillar Strategy
Four Pillar Strategy The World’s Premier Provider of Specialized Polymer Materials, Services & Solutions Page 5
Slide 6: PolyOne At A Glance
PolyOne At A Glance 2012 Revenues: $4.0 Billion* 2012 Revenues: $4.0 Billion* Latin Canada Asia America Distribution Europe 8% 14% 5% 3% 25% PP&S 15% United Specialty States 60% 70% End Markets* EPS Textiles 1% Appliance 2.50 $2.50 6% Transportation $2.25 16% $2.00 Adjusted Earnings Per Share Health
Slide 7: Mix Shift Highlights Specialty Transformation
Mix Shift Highlights Specialty Transformation Old 2015 PolyOne Transformation Target 100% % of Operating Income* 80% 60% 40% 65- 63% 75% 20% 43% 34% 0% 2% 2005 2008 2010 YTD 2013 2015 Specialty OI $5M $46M $87M $153M Target JV's PP&S Distribution Specialty *Operating Income excludes corporate charge
Slide 8: Proof of Performance & 2015 Goals
Proof of Performance & 2015 Goals 2006 YTD 2013 2015 Where we were Where we are Target Organic Consolidated 1) Operating Income % Specialty: Global Color, Additives & Inks 1.7% 12.8% 12.8% 12 – 16% Global Specialty Engineered Materials 1.1% 10.8% 8.9% 12 – 16% Designed Structures & Solutions — — 5.0
Slide 9: Innovation Drives Earnings Growth
Innovation Drives Earnings Growth Research & Development Specialty Platform Specialty Platform Spending Vitality Index Progression* Gross Margin % 44.0% $46.6 31.0% 19.5% $20.3 14.3% ($ millions) 2006 TTM 2006 Q3 2013 2006 Q3 2013 Q3'13 *Percentage of Specialty Platform revenue from products introdu
Slide 10: We are Experts in Polymer Science and Formulation
We are Experts in Polymer Science and Formulation PolyOne Customer Marketplace Demands Performance Requirements Inputs Expertise Value Drivers Base Resins Polymer Science Additives Formulation Modifiers Chemistry Colorants Processing Innovative Specialized Polymer Materials, Pr
Slide 11: Positioned for Strong Growth
Positioned for Strong Growth 2015 Target Assumptions Rev: $5B • Mid single digit revenue CAGR Adj. EPS: $2.50 • Operating margins in mid-range of 2015 targets • No global recession • No investment in incremental PP&S capacity • Housing starts at 85% of 50 year norm by 2015 • Remain comfortably below
Slide 12: Q3 2013 Financial Highlights
Q3 2013 Financial Highlights Adjusted EPS $0.40 • Adjusted EPS increased 29% over 29% $0.36 prior year $0.30 $0.28 $0.20 Q3 '12 Q3 '13 • Adjusted Operating Income Adjusted Operating Income expanded 40% versus Q3 2012 $80.0 (millions) $72.4 40% $60.0 $51.8 • Specialty operating income up $40.0 74% Q3
Slide 13: Debt Maturities & Liquidity Summary – 9/30/13
Debt Maturities & Liquidity Summary – 9/30/13 Significant Debt Maturities Significant Debt Maturities $ 965 $800 As of September 30, 2013 ($ millions) Other Debt 22 $700 Total Debt at 9/30/13 $ 987 $600 Less: Cash 323 $600 Net Debt $ 664 $500 $400 Available Liquidity Cash $ 323 $300 $317 ABL Availab
Slide 14: Use of Cash
Use of Cash Organic Share/Bond Acquisitions Dividends Growth Repurchase • Expanding our • Targets that expand our: • Announced a • Repurchased 3.8M sales, marketing, 33% increase in shares YTD in and technical • Specialty offering quarterly dividend 2013 capabilities is top • End market presence on
Slide 15: Why Invest In PolyOne?
Why Invest In PolyOne? • Strong past performance demonstrates that our strategy and execution are working • Megatrends align with our strengths • Innovation and services provide differentiation and competitive advantage • Strong and proven management team driving growth and performance • Addressable
Slide 16: Schedule I Reconciliation of Non-GAAP Financial Measures
Schedule I Reconciliation of Non-GAAP Financial Measures (Unaudited) (Dollars in millions, except per share data) Below is a reconciliation of non-GAAP financial measures to the most directly comparable measures calculated and presented in accordance with U.S. GAAP. Senior management uses adjusted o
Slide 17: Platform operating income and EPS reconciliation
“””Three Months Ended ‘’’’’September 30, Platform operating income “””””””2013 2012 (a) Global Specialty Engineered Materials $ 15.7 $ 13.1 Global Color, Additives and Inks 28.7 18.6 Designed Structures and Solutions 10.9 – Specialty Platform 55.3 31.7 Performance Products and Solutions 14.3 12.3 Po
Slide 18: Adjusted EBITDA
Adjusted EBITDA Q4 2012 Q1 2013 Q2 2013 Q3 2013 Total PolyOne Income before income taxes $ (1.1) $ 15.7 $ 62.9 $ 38.8 $ 116.3 PolyOne Interest expense, net 13.7 15.6 16.6 16.0 61.9 PolyOne Depreciation and amortization 15.5 19.0 25.8 30.3 90.6 PolyOne Special items in EBITDA 26.5 27.7 (5.2) 11.2 60.
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