Slide 1: 3Q 2016 Earnings Presentation
November 10, 2016 3Q 2016 EARNINGS PRESENTATION
Slide 2: Forward Looking Statements
2 Forward Looking Statements 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: Highlights
3 Highlights • 3Q 2016 Financial Results • 4Q 2016 Plant Turnaround • Capex Update • AdvanSix Market Outlook • Summary 3Q 2016 Earnings Presentation – November 10, 2016
Slide 4: 3Q 2016 Financial Summary
4 3Q 2016 Financial Summary Higher Volumes Driven By Increased Production Rates ($ Millions, Except Per Share Amounts) 3Q 2015 3Q 2016 Comments • Volume +4%, Price (7%) Sales $335.9 $324.0 – Market Pricing (5%), Raw Material Pass Through (2%) EBITDA $40.1 $38.1 • Improved Production Volume And Conti
Slide 5: Pricing Mechanisms
5 Pricing Mechanisms Mitigate Commodity Price Risk Through Formula Price Agreements 2015 Sales By Product ~50% Formula / Index Pricing • Pricing Linked to Input Raw Materials and/or Published Industry Indices • Moves in Underlying Raw Materials Typically in Tandem With Sales Price Chemical • “Add
Slide 6: Plant Performance
6 Plant Performance Higher Utilization Rates Through 3Q 2016 YTD Plant Production +17% • Improved Production Rates Across All Three Of Our Major Manufacturing Sites – New Polymer Line Investment Contributing To Chesterfield +7% Production Rates • Maintenance Excellence, Mechanical Integrity And +3%
Slide 7: 4Q 2016 Plant Turnaround
7 4Q 2016 Plant Turnaround Supporting Improved Uptime And Higher Utilization Rates Going Forward Pre-Tax Income Impact Comments ~$40 - $45M • Extensive 4Q 2016 Planned Turnaround – Semi-Annual Hopewell Outage Including Scheduled 18-month Unplanned Ammonia Plant Overhaul And Utility Shutdown – Cheste
Slide 8: Capital Investments
8 Capital Investments Addressing Assets Key To Safe, Sustainable Operations $101M $97M ~$90M Expect 2017 Capex $74M 14% 32% 11% ~$90M 8% 25% 32% 22% 23% 62% 57% • Project prioritization based on compliance 70% 45% requirements, risk assessments and ROI in context of cash capacity 2013 2014 2015 2016
Slide 9: AdvanSix Market Outlook
9 AdvanSix Market Outlook Recent Price Firming, End Market Fundamentals Remain Dynamic Nylon Ammonium Sulfate Chemical Intermediates • Asia Caprolactam import • Cornbelt Granular AS prices • Acetone demand outpacing price/raws spread down (~15%) down (~20%) 3Q16 YoY (2) supply in 3Q16 3Q16 YoY (1) W
Slide 10: Summary
10 Summary • Low Cost Position Drives Strong 3Q16 Performance In Challenging Environment • Signs Of Supply/Demand Re-Balancing For Caprolactam, While Fertilizer Fundamentals Remain Weak • Extensive 4Q16 Plant Turnaround – Positioning For Improved Uptime And Higher Utilization Rates Going Forward • C
Slide 11: Appendix: Reconciliation of non-GAAP Measures to GAAP Measures
11 Appendix: Reconciliation of non-GAAP Measures to GAAP Measures 3Q 2016 Earnings Presentation – November 10, 2016
Slide 12: Reconciliation Of Net Cash Provided By Operating Activities To Free Cash Flow
12 Reconciliation Of Net Cash Provided By Operating Activities To Free Cash Flow (Unaudited; In Thousands) Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Net Cash Provided by Operating Activities $ 24,614 $ 23,421 $ 66,467 $ 69,848 Expenditures for Property, Pla
Slide 13: Reconciliation Of Net Income To EBITDA
13 Reconciliation Of Net Income To EBITDA (Unaudited; In Thousands) Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Net Income $ 16,460 $ 20,411 $ 58,861 $ 48,438 Income Taxes 11,342 11,684 36,712 27,722 Depreciation and Amortization 10,307 7,987 29,964 27,376 EB