Slide 1: 3Q 2019 Earnings Presentation
November 1, 2019 3Q 2019 Earnings Presentation
Slide 2: Forward Looking Statements
Forward Looking Statements 2 This presentation contains certain statements that may be deemed “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, that address activities, events o
Slide 3: Overview
Overview 3 • Sales $311M, down (16%) including (11%) lower raw material pass-through pricing, (3%) unfavorable market-based pricing, and (2%) lower volume • Pre-tax Income results reflect net favorable ~$25M YoY impact of planned plant turnarounds 3Q19 • EPS $0.28, up 56%; Repurchased ~$13M of share
Slide 4: 3Q 2019 Financial Summary
3Q 2019 Financial Summary 4 Executing in a More Challenging Macro Environment ($ Millions, Except Per Share Amounts) 3Q 2018 3Q 2019 Comments • Sales Down (16%): Volume (2%), Price (14%) Sales $368.7 $310.6 – Raw Material Pass Through (11%), Market Pricing (3%) • Net ~$25M Favorable YoY Impact of Pl
Slide 5: Sequential EBITDA Performance (2Q19 to 3Q19)
Sequential EBITDA Performance (2Q19 3Q19) 5 AS Seasonality and Challenging Industry Conditions Key Sequential Drivers EBITDA ($M) Performance Considerations Ammonium Sulfate Seasonality • (~$13M) typical seasonal decline and unfavorable product mix with new season fill in 3Q • Domestic ammonium su
Slide 6: Nylon Industry Outlook
Nylon Industry Outlook 6 Broader Macro Uncertainty, Falling Commodity Input Environment Nylon Key Industry Spreads (1) • Further demand softness in 3Q19 YoY 3Q19 vs. 2Q19 3Q19 Global Composite BNZ-CPL (26%) (15%) What We’re • Industry pricing/spreads near Asia BNZ-CPL (40%) (25%) Seeing recent 2016
Slide 7: Ammonium Sulfate Industry Outlook
Ammonium Sulfate (AS) Industry Outlook 7 Industry Dynamics Remain Mixed Into 2020 Planting Season Ammonium Sulfate Key Industry Prices (1) • Fertilizer industry pricing down 3Q19 YoY 3Q19 vs. 2Q19 YoY and seasonally vs. 2Q19 Corn Belt Granular AS (3%) (5%) What We’re • Ag fundamentals challenging; C
Slide 8: Chemical Intermediates Industry Outlook
Chemical Intermediates Industry Outlook 8 Global Acetone Oversupply Continued in 3Q19 Chemical Intermediates Key Industry Prices (1) 3Q19 YoY 3Q19 vs. 2Q19 • Soft phenol and acetone Acetone, Small/Medium Buyer (40%) 1% demand globally reflecting Acetone, Large Buyer (37%) (3%) What We’re weaker down
Slide 9: Capital Expenditures
Capital Expenditures 9 Execution of High-Return Growth and Cost Savings Projects in 2019 Growth/Cost Savings ~$150M • Executing against multi-year $150-$200M pipeline of high- return projects; 20%+ IRR target $109M ~38% $90-$110M • Relocation of R&D lab to Chesterfield from Colonial Heights adds ~$1
Slide 10: 4Q19 / 2020 Outlook
4Q19 / 2020 Outlook 10 Focused Cost Management and Capital Discipline in Challenging Macro Environment 4Q19 2020 Trend • Year-over-year demand growth deceleration • Macro uncertainty to drive fluctuations in global Nylon expected to continue operating rates, pricing and spreads Ammonium • Ammonium s
Slide 11: AdvanSix Strategic Priorities
AdvanSix Strategic Priorities 11 Well Positioned for Strong Operational and Financial Performance Over Long Term Focus Areas For Further Value Creation • Averaging 90%+ utilization rates through the cycle 1) Safe and Stable Operations • Less variability in utilization rates drives higher returns • R
Slide 12: Appendix
12 Appendix 3Q 2019 Earnings Presentation – November 1, 2019
Slide 13: Planned Plant Turnarounds
Planned Plant Turnarounds 13 Pre-Tax Income Impact by Quarter (1) 1Q 2Q 3Q 4Q FY 2017 -- ~$10M ~$4M ~$20M ~$34M 2018 ~$2M ~$10M ~$30M -- ~$42M 2019 -- ~$5M ~$5M ~$25M ~$35M 2020E ~$5M $25-$30M -- ~$3M $33-$38M • Timing driven by compliance, inspection and sustaining asset base • Critical to supporti
Slide 14: Reconciliation of non-GAAP Measures to GAAP Measures
14 Appendix: Reconciliation of non-GAAP Measures to GAAP Measures 3Q 2019 Earnings Presentation – November 1, 2019
Slide 15: Reconciliation Of Net Cash Provided By Operating Activities To Free Cash Flow
Reconciliation Of Net Cash Provided By Operating 15 Activities To Free Cash Flow (in $ thousands) (1) Free cash flow is a non-GAAP measure defined as Net cash provided by operating activities less Expenditures for property, plant and equipment The Company believes that this metric is useful to inves
Slide 16: Reconciliation Of Net Income To EBITDA
Reconciliation Of Net Income To EBITDA 16 (in $ thousands) (2) EBITDA is a non-GAAP measure defined as Net Income before Interest, Income Taxes, Depreciation and Amortization (3) One-time Pottsville restructuring charges reflect the closure of the Company’s Pottsville, Pennsylvania films plant (4) E
Slide 17: Reconciliation Of Net Income To EBITDA
Reconciliation Of Net Income To EBITDA 17 (in $ thousands) (5) EBITDA is a non-GAAP measure defined as Net Income before Interest, Income Taxes, Depreciation and Amortization (6) One-time Pottsville restructuring charges reflect the closure of the Company’s Pottsville, Pennsylvania films plant (7) E