Ashland Inc. · NYSE:ASH
Ashland — Ashland Global Holdings — Q2 FY2016 Earnings Presentation
33 slides from Ashland's earnings presentation, Jun 20, 2016
Slide 1: Summary of Recent Ashland Performance: Second-Quarter Fiscal 2016
Filed by Ashland Inc. Pursuant to Rule 425 under the Securities Act of 1933 and deemed filed pursuant to Rules 14a-6 and 14a-12(b) of the Securities Exchange Act of 1934 Subject company: Ashland Global Holdings Inc. Commission File No. 333-211719 Filed Pursuant Securities pursuant of Subject Commiss
Slide 2: Forward-Looking Statements
Forward-Looking This identified and percent registration expected quarterly expectations Valvoline competitive assumptions prices, proposed connection following of benefits asbestos uncertainties SEC’s Ashland sell under Regulation The alternative segments. reconciled operations, or “intends” inform
Slide 3: Additional Information and Where to Find It
A registration Non-solicitation accepted sale Additional In that READ INFORMATION the website Participants This participants statement regarding of connection charge reorganization also in presentation any THE atconstitutes before from Ashland relating www.sec.gov. jurisdiction Information in PROXY
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Slide 5: Our Transformation: Ashland Is Different, More Profitable Than 1995
(Our Acquired Ashland (Adhesives) Exited entered $13.4B Valvoline Chemicals Distribution Other 66% products 1995 We 5the Zeta start are History 63% Revenues ~5% Fraction™) Ashland a$5.4B JV of Distribution Chemicals different, 8% & our exited 21% EBITDA 26% transformation 2015 Paving Specialty JV199
Slide 6: Strategic Decisions Have Dramatically Expanded EBITDA Margins
Strategic Tech. & Restructuring August Divested March Acquired November 3.9% 612006 2006 Global 2007 4.5% (July 2011 through 2011 Water Decisions Distribution ISP Hercules 20.8% 2008 4.3% 2014) 12.6% 16.6% 17.6% 2015 9.0% 2009 9.7% Have 15.9% EBITDA 2010 Dramatically 2011 margins 2012 2013 Expanded
Slide 7: Baseline EBITDA Historical Performance
Baseline ($ $1,070 $1,197 $750 $850 $955 18.5% 16.5% 2009 EBITDA 71Strategic See in millions) 20.8% 2010 appendix 17.6% 16.7% $1,078 Historical actions EBITDA 2011 17.6% 15.7% $1,119 for 2012 have % reconciliation Performance1 2013 led to2014 stable2015 toand amounts growing reported margins under G
Slide 8: Ashland Profile: Corporate Sales
Corporate Sales1—$5.1 By Specialty Ashland Ingredients Materials 42% 20% Asia Valvoline 138% 82Other—7% Ashland For business America/ 53% Pacific 12 months America2 Europe Latin Profile includes Performance unit Billion 16% ended Byonly geography March U.S. Ashland and 31,Canada North 2016. 24% in i
Slide 9: Ashland Profile: Corporate Adjusted EBITDA
Corporate Adjusted Specialty 12% Materials Performance Ashland Ingredients NYSE 47% Total Outside Number in 91Has For Which Sales: Employees: 12 Ticker North of months EBITDA1—$1.1 Ashland Valvoline Profile than Countries 41% Symbol: America 100 ended ~11,000 More ASH March ~30% Billion 31, 2016. Se
Slide 10: Second Quarter Fiscal Highlights
Fiscal Highlights1 $1,600 22.3% $1,200 $1,163 $1,247 $1,350 $0 $400 10% $800 Adj. Factors 43($, Q2 Mix of Reported business Adjusted 21?Completed 10 01 As Repurchased Ashland‘s Acquisitions the 0% Millions) 2015 (7) Performance EPS expected, Second 21.2% 30% (15) affecting Vol/ Q1 earnings EBITDA $2
Slide 11: Ashland Results Summary
Adjusted ($ Three 2016 Sales Gross Selling, Operating Depreciation Earnings and EBITDA As 21Favorable 11 Ashland‘s Divestitures inexpected, amortization millions) 2015 $months profit 1,247 general before as Results income business Change aearnings asand headwinds $percent ended includes Fiscal a1,35
Slide 12: Specialty Ingredients Sales Profile
Ashland cellulose Sales by Coatings 15% Pharma Cellulosics 16% Personal 26% 321For 12 Within See Includes Market2 12 Adhesive Europe 14% Sales Appendix Months 32% Specialty Care the Asia ethers, 38% Biocides’ Vinyl Sales by Sales 19% 38% PVP19% Product Ended D vinyl Ethers by Ingredients: for Other3
Slide 13: Specialty Ingredients Results Summary
Ashland Adjusted ($ Three 2016 Metric Sales Gross Selling, Operating Depreciation Earnings and 1?EBITDA 13 Volume Ashland’s inamortization millions) 2015 $months profit tons 529 general Specialty before as Results and income Change sold $aearnings asand 583 percent share ended Fiscal aand interest,
Slide 14: Performance Materials Sales Profile
Ashland Global Sales by Process Industries Marine 71% Composites 15% Construction: Industrial 30% Other 21For 14See PU/TPU Market 12 North 6% Sales Appendix Months leader 15% Europe Performance America/ Intermediates/ by stands America Sales Solvents Product in 41% Ended D unsaturated for for Latin
Slide 15: Performance Materials Results Summary
Ashland Adjusted 1Strong ($ 15 Second Fiscal Three Dec. Metric Change 2015 2016 Gross $2313% $286(16)% $239 Sales 10% 106.2 118.3(2)% 116.3 Selling, (150)bp 22.1% 22.7% 20.6% $303% $35(11)% $31 Operating $24(17)% $30(33)% $20 Depreciation (200)bp 10.4% (210)bp 10.5% 8.4% — $14(7)% $13 Earnings EBITD
Slide 16: Valvoline Sales Profile
Valvoline: Sales by Valvoline Instant Change4 88% DIFM: Channel 21% Europe For 29% 43213% 16See Includes Market 12 Asia Yourself 29% Sales Appendix Months Oil Australia Installer Do-It- International Valvoline Pacific Lubricant4 A by nonconsolidated car Oil International leading Product Filters care
Slide 17: Valvoline Results Summary
Results Valvoline ($ Three 2016 Lubricant Sales Gross Selling, Operating Depreciation Earnings and ?EBITDA 1locations 17Continued Ashland’s inamortization millions) 2015 $months profit 479 Summary1 general before in as gallons income Change $the aearnings as execution and 481 percent ended Fiscal aU
Slide 18: Fiscal 2016 Corporate Items and Cash Flow
Fiscal Corporate Net Adjusted Trade Capital 21?Free 18 FY Trade Definition interest cash 2016 Working Second expenditures Working corporate effective flow2 Items expectation expense ofQuarter free Capital1 generation Capital tax operating cash of totaled rate 2016 of at remains $43 for flow: defined
Slide 19: Corporate Actions to Create Value
Corporate Fiscal Actions ?Extended ??Reduced ?Concluded ….have 19 Executed Contributed Year Ashland created U.S. Actions debt $1.1 2015 significant $500 pension maturities value billion has tomillion taken Create for asbestos five-year risk shareholders. at to of Value lower improve cash insurance t
Slide 20: Appendix A: Bridges, Volume Trends, Liquidity and Net Debt
Appendix A: Bridges Volume Trends Liquidity and Net Debt
Slide 21: Ashland Revenue Bridge Q2
Ashland Revenue ($ 1,350 1% Q2 Headwinds Other1 ~$60 1Raw 21 Acquisitions millions) 2015 material million -5%Q2 Volume Bridge -2% from FY headwind pass include -1% 2015 currency, Price through -1% vs. OCH Currency to1,247 Q2 overall energy was International, FYprimary 2016 Acq/Div/ sales markets dri
Slide 22: Ashland Adjusted EBITDA Bridge Q2
Ashland Adjusted 43($ Q2 Mix Gains 22 01millions) 2015 (7) Expenses in(15) Q2 volume Volume/ EBITDA FY (2)Translation (7) 2015 / Margin mix Bridge 274 vs. ledQ2 SG&A byFY strong 2016 Currency Valvoline Other results Q2 2016 Foreign currency headwinds receded to $2 million
Slide 23: Specialty Ingredients Adjusted EBITDA Bridge Q2
Ashland Adjusted 1($ Q2 Mix Energy Divestitures 23 42millions) 2015 (12) Expenses end Specialty (1) Volume/ EBITDA market Q2 (1) and Translation FY (2) exited Margin Ingredients Bridge represents 2015 127 product versus SG&A$4lines Q2 million Currency FY(biocides 2016 of Other Volume/Mix andQ2 RDP)
Slide 24: Performance Materials Adjusted EBITDA Bridge Q2
Ashland Adjusted 04($ (15) Q2 Mix I&S Planned 24 4 millions) 32015 33 pricing Expenses 0 1 Marl Performance Volume/ EBITDA Q2 accounts BDO Translation FYMargin Bridge 2015 shutdown for Materials versus the SG&A majority negatively Q2 Currency FYof2016 margin impacted Otherimpact Q2 margin 2016 Compo
Slide 25: Valvoline Adjusted EBITDA Bridge Q2
Adjusted Valvoline ($ 16 106 Q2 Mix Strong SG&A 25 millions) 52015 (11) Expenses 0 DIY growth (1) Volume/ EBITDA and Q2 115 Translation FY VIOC Margin Bridge 2015results, versus SG&A lower Q2 Currency FY input 2016costs, Otherdisciplined Q2 2016 margin management and good volume/mix key to EBITDA gr
Slide 26: Normalized Rolling Four Quarters Volume Trends
Normalized Rolling 110% Specialty 90% 95% 100% 105% Quarters Mar 85% 1Period ASI 26Excludes and ‘14Ended Four Jun APM Ingredients volumes Volume ‘14 reflect SeptTrends1 associated Performance realignment ‘14 Dec ‘14 with of Mar Materials divestitures adhesives ‘15 JunValvoline ‘15 and of Sept elasto
Slide 27: Liquidity and Net Debt
($AR At Available Liquidity Interest Debt 4.750% Term 3.875% 6.875% A/R 6.5% par Revolver Other Ba1/ Total Stable Cash 1Net 2with 3$250 Scheduled by FY $143 $180 $611 $666 $715 $810 $1,125 and 27The $1.2 in Mar Fiscal ‘16 $1,125 $700 $375 $282 debt after facility complete millions) BB/ Expiration mi
Slide 28: Appendix B: Non-GAAP Reconciliations
Appendix B:Reconciliations Non-GAAP
Slide 29: Reconciliation for Adjusted EBITDA: 12 Months Ended March 31, 2016
Ashland Reconciliation for ($ Sales1 EBITDA Adjusted Specialty Performance Valvoline Unallocated 1Total Ashland’s 29Quarterly millions, 12274 1,247 Months Q2 Inc. EBITDA1 Ingredients 247 479 115 website 161,163 totals except (1) Materials and Q1 265 101 456 Ended of15Consolidated 16 Non-GAAP may 1,2
Slide 30: Reconciliation for Adjusted EBITDA: 12 Months Ended September 30, 2015
Ashland Reconciliation for ($ Sales1 EBITDA Adjusted Specialty Performance Valvoline Unallocated 1Total Ashland’s 30Quarterly millions, 12265 1,280 Months Q4 Inc. EBITDA1 Ingredients 290 484 97 website 151,367 totals except 6116 Materials and Q3 301 10 510 Ended of 106 Consolidated 15 9Non-GAAP may
Slide 31: Reconciliation for Adjusted EBITDA: 12 Months Ended September 30, 2014
Ashland Reconciliation for ($ Sales1 EBITDA Adjusted Specialty Performance Valvoline Unallocated 1Total Ashland’s 31Quarterly millions, 12272 1,538 Months Q4 Inc. EBITDA1 Ingredients 298 520 87 website 141,605 totals except 799 Materials and Q3 272 4532 Ended of390 Consolidated 14 Non-GAAP may 1,545
Slide 32: Reconciliation for Baseline EBITDA Fiscal Years 2009-2013
Ashland Reconciliation for ($ Sales1 Previously Adjustment Pro Adjusted 1Baseline those 32As millions, the forma reported reported 2009 Fiscal Inc. EBITDA Sales EBITDA1 Baseline adjustment asexcept for 2010 and Years reported figures under of 4,558 Water Consolidated Non-GAAP 2011 Margin EBITDA perc
Slide 33: With good chemistry great things happen. Ashland
With good chemistry great things happen. ASHLAND
Ashland Global Holdings — Q2 FY2016 Earnings Presentation on 6ix