Ecovyst Inc. · NYSE:ECVT
Ecovyst — Q3 2022 Earnings Presentation
25 slides from Ecovyst's earnings presentation, Nov 1, 2022
Slide 1: Third Quarter 2022
Third Quarter 2022 November 1, 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 Strong Q3 2022 results with Sales and Adjusted EBITDA Growth of 30%1,2 and 1 9%1,2 Cost pass-through and pricing actions continued to mitigate inflationary 2 pressures Maintained leverage ratio of 2.8x with strong cash generation supporting $65 3 million of cash deployed in share repurc
Slide 5: Strong Operating and Financial Performance Demonstrating Resilience of Business Model
Strong Operating and Financial Performance Demonstrating Resilience of Business Model Q3 2022 Key Highlights1,2 30% 9% ~80% Sales Growth Adj. EBITDA Growth Cash vs. 20211 vs. 20211,2 Conversion3,4 2.8x #1 or #2 $199 Mln Leverage Ratio5 Supply Share Position Liquidity6 1. Sales change percentage incl
Slide 6: Demand Fundamentals Remain Favorable
Demand Fundamentals Remain Favorable 2021 Demand Trend Industry End Key Total Growth 2022 Anticipated Demand Drivers Use Products Q3’22 Q4’22E Sales Rate Vs Q2’22 vs Q3’22 Regeneration Robust demand driving U.S. refinery utilization to CLEAN FUELS For Alkylation ~32% ~3% >90% as margins increase whi
Slide 7: Third Quarter 2022 Financial Performance
Third Quarter 2022 Financial Performance
Slide 8: Financial Performance – Q3 2022 Third Quarter Financial Results
Financial Performance – Q3 2022 Third Quarter Financial Results Third Third Quarter Quarter $ % ($ in millions) 2022 2021 Change Change Ecovyst Sales 232.5 167.4 65.1 38.9 Zeolyst JV Sales 27.8 32.8 (5.0) (15.4) Adjusted EBITDA1 75.4 69.4 6.0 8.6 Adjusted EBITDA Margin1,2 (%) 29.0 34.6 (560 bps) $ %
Slide 9: Adjusted EBITDA Bridge – Q3 2022
Adjusted EBITDA Bridge – Q3 2022 Ecoservices unit margins expanded with contractual cost pass-through and Catalyst Technologies margins stable with strong pricing power Positive price-cost Adjusted EBITDA Impact 29.0%1,2 ($MM) 34.6%1,2 1. See Appendix for Reconciliations of non-GAAP measures. THIRD
Slide 10: Ecoservices – Q3 2022 Financial Performance
Ecoservices – Q3 2022 Financial Performance Third Third Quarter Quarter $ % ($ in millions) 2022 2021 Change Change Ecoservices Sales 195.7 137.5 58.1 42.3 Adjusted EBITDA1 64.1 51.9 12.2 23.5 Adjusted EBITDA Margin1 (%) 32.8 37.7 Ecoservices Highlights • Third quarter results reflect higher demand
Slide 11: Catalyst Technologies – Q3 2022 Financial Performance
Catalyst Technologies – Q3 2022 Financial Performance Third Third Quarter Quarter $ % ($ in millions) 2022 2021 Change Change Silica Catalysts Sales 36.8 29.9 6.9 23.1 Zeolyst JV Sales 27.8 32.8 (5.0) (15.4) Adjusted EBITDA1 19.3 25.5 (6.2) (24.3) Adjusted EBITDA Margin1,2 (%) 29.9 40.7 Catalyst Tec
Slide 12: Leverage & Liquidity
Leverage & Liquidity Net Leverage Ratio1 Liquidity2 ($ Millions) 3.8x $236 3.3x $203 $207 $199 3.1x 2.8x 2.8x $165 Leverage Ratio Liquidity • Leverage ratio maintained at 2.8x, with strong • Decrease in liquidity reflects strong cash cash generation supporting share repurchases collection and lower
Slide 13: Balanced Capital Allocation Strategy to Support Growth Initiatives and Drive Shareholder Return
Balanced Capital Allocation Strategy to Support Growth Initiatives and Drive Shareholder Return Strong free cash flow generation provides financial flexibility and supports a balanced capital allocation strategy focused on: Cash Flow from Operations • Operational improvements & organic growth Less:
Slide 14: Ecovyst 2022 Outlook
Ecovyst 2022 Outlook Ecovyst1 Q2 2022 Q3 2022 ($ in millions, 2021 Prior Updated except per share) Actual Guidance Outlook Sales2 $611 $830 -$850 $810 -$830 Adjusted EBITDA Growth of 19% Zeolyst JV Sales $131 $135 – $145 $135 – $145 In 2022 from 2021 Assuming midpoint of guidance Adjusted EBITDA3 $2
Slide 15: Summary
Summary Business resilience continued in face of inflationary pressures and 1 challenging geopolitical environment Leadership positions, longstanding customer relationships and order backlog 2 we believe provides good near-term visibility Strong cash generation capability has facilitated reduction i
Slide 16: APPENDIX
APPENDIX
Slide 17: Well Positioned for Future Growth - Meeting Industry Needs for Sustainable Technologies
Well Positioned for Future Growth - Meeting Industry Needs for Sustainable Technologies % of R&D Spend On • 75% of current end use sales address customer and consumer Green Technologies demand for more sustainable products and services ~80% ~90% ~60% Sustainability • More than 80% of innovation inve
Slide 18: Ecoservices: North American Leader in Sulfuric Acid Recycling and Related Services
Ecoservices: North American Leader in Sulfuric Acid Recycling and Related Services with Key Competitive Position in Gulf Coast and California NEAR-TERM GROWTH FACTORS • Existing customer re-contracting, and favorable alkylate fundamentals expected to drive growth for regeneration services • Rising v
Slide 19: Catalyst Technologies: Global Leader in Tailored Catalyst Solutions
Catalyst Technologies: Global Leader in Tailored Catalyst Solutions NEAR-TERM GROWTH FACTORS • Preferred technology and increasing product offerings for strengthening & light weighting of materials projected to drive growth in polyethylene catalysts • Growing demand for renewable fuels • Increasing
Slide 20: Quarterly Segment Sales, Adjusted EBITDA and Margins
Quarterly Segment Sales, Adjusted EBITDA and Margins Nine Months Nine Months Three Months Ended Ended Three Months Ended Ended March 31, September 30, September March 31, September 30, September ($ in millions, except %) 2022 June 30, 2022 2022 30, 2022 2021 June 30, 2021 2021 30, 2021 Sales: Ecoser
Slide 21: Sales and Adjusted EBITDA Major Change Factors
Sales and Adjusted EBITDA Major Change Factors Sales Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 Sales Silica Silica (in $ millions and %) Ecovyst Ecoservices Catalysts Ecovyst Ecoservices Catalysts Sales: $ % $ % $ % $ % $ % $ % Volume 14.8 8.9 4.9 3.6 9.9 33.2 48.3 1
Slide 22: Reconciliation of Net Income (Loss) to Adjusted EBITDA
Reconciliation of Net Income (Loss) to Adjusted EBITDA Nine Nine Months Months Three Months Ended Ended Three Months Ended Ended March 31, June 30, September September March 31, June 30, September September ($ in millions, except %) 2022 2022 30, 2022 30, 2022 2021 2021 30, 2021 30, 2021 Reconciliat
Slide 23: Adjusted Free Cash Flow
Adjusted Free Cash Flow Full Year Nine months ended ($ in millions) 20211 September 30, 2022 Cash flow from Operations before interest and tax 200.7 158.1 Less: Cash paid for taxes 11.8 24.4 Less: Cash paid for interest2 59.0 24.4 Cash Flow from Operations 129.9 109.3 Less: Purchases of property, pl
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 ™