Slide 1: Second Quarter 2019 Earnings Presentation
Second Quarter 2019 Earnings Presentation August 1 2019
Slide 2: Legal Notices
Legal Notices SAFE HARBOR Please note that in this presentation, we may discuss events or results that have not yet occurred or been realized, commonly referred to as forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statement
Slide 3: Second Quarter 2019 Financial Results
Second Quarter 2019 Financial Results Continuing Operations Constant ▪ Organic net sales* declined 6%, driven by persisting Currency* Organic* weakness in high-end smart phone and automotive markets as well as a broader economic slowdown in ($ in millions) Q2 2019 Q2 2018 YoY YoY YoY Asia Net Sales
Slide 4: Second Quarter 2019 Segment Details
Second Quarter 2019 Segment Details Market Commentary Electronics Net Sales ($ in millions) 296 ▪ Weakness in Electronics end-markets consistent with trends 1% seen in Q4 2018 and Q1 2019, reflecting a degree of 268 (4%) stabilization (3%) (2%) (2%) o Q1 2019 global mobile phone shipments declined 6
Slide 5: Balance Sheet and Cash Flow Considerations
Balance Sheet and Cash Flow Considerations Continuing Operations Key Cash Flow Items Balance Sheet Management ▪ Q2 2019 YTD free cash flow* from continuing operations of ~$86 ▪ Net debt to adj. EBITDA ratio* of 3.3x on a trailing twelve month million on an adjusted basis*, which excludes the impact
Slide 6: Full Year 2019 Financial Guidance
Full Year 2019 Financial Guidance Q2 2019 Update Electronics Industrial & Specialty ▪ Modest seasonal pickup expected due to planned ▪ Continued pressures from trade tensions and product launches – expectations for growth have slowdown in global industrial production moderated since Q1 ▪ Weaker-than
Slide 7: 2019 Priorities
2019 Priorities Successful Launch of Element Solutions Delivery of Financial Commitments and Strategic Initiatives Compelling Free Cash Flow Growth Capital Allocation to Compound Long-Term Shareholder Value 7
Slide 8: Appendix
Appendix 8
Slide 9: 2019 Investor Day Key Takeaways
2019 Investor Day Key Takeaways High-Quality Businesses Capable, Deep Leadership Team Positioned to Grow and Efficiently Clear Pathway to Deliver on our with a Performance and Convert Earnings to Free Cash Medium-Term Financial Objectives: Ownership-Orientated Culture: Flow*: Defensible, Leading Mar
Slide 10: Capital Structure
Capital Structure ($ millions) Instrument Maturity Coupon 6/30/2019 Corporate Revolver 1/31/2024 LIBOR plus 2.25% $50 First Lien Credit Facility - USD Term Loans1 1/31/2026 LIBOR plus 2.25% 746 Other Secured Debt 1 Total First Lien Debt $797 Senior Notes due 2025 12/1/2025 5.875% 800 Other Unsecured
Slide 11: Reconciliation to Adjusted Share Counts
Reconciliation to Adjusted Share Counts (amounts in millions) Q2 2019 Q2 2018 Basic outstanding common shares 257 288 Number of shares issuable upon conversion of PDH Common Stock — 4 Number of shares issuable upon conversion of Series A Preferred Stock 2 2 Number of shares issuable upon vesting and
Slide 12: Net Income Reconciliation to Adj. EBITDA (Continuing Operations)
Net Income Attributable to Common Stockholders Reconciliation to Adj. EBITDA (Continuing Operations) ($ millions) Q2 2019 Q2 2018 Net income attributable to common stockholders $2 $12 Add (subtract): Net loss to the non-controlling interests (0) (0) Loss (income) from discontinued operations, net of
Slide 13: Net Debt to Adj. EBITDA Ratio Reconciliation on a Trailing Twelve Month Basis
Net Debt to Adj. EBITDA Ratio Reconciliation on a Trailing Twelve Month Basis (Continuing Operations) ($ millions) YTD 2019 Q3 2018 Q4 2019 LTM Q2 2019 Net income (loss) attributable to common stockholders $25 $(409) $35 $(349) Add (subtract): Net income attributable to the non-controlling interests
Slide 14: GAAP Net Income Reconciliation to Adjusted Diluted EPS
GAAP Net Income Reconciliation to Adjusted Diluted EPS (Continuing Operations) ($ millions, except per share amounts) Q2 2019 Q2 2018 Net income attributable to common stockholders $2 $12 Net (loss) income from discontinued operations attributable to common stockholders (13) 61 Net income (loss) fro
Slide 15: Organic Net Sales Growth Reconciliation
Organic Net Sales Growth Reconciliation (Continuing Operations) Three Months Ended June 30, 2019 Change in Pass- Reported Net Impact of Constant Organic Net Sales Through Metals Acquisitions Sales Growth Currency Currency Growth Pricing Electronics (9)% 4% (6)% 0% 0% (6)% Industrial & Specialty (8)%
Slide 16: Non-GAAP Definitions
Non-GAAP Definitions Adjusted Earnings Per Share (EPS): Adjusted earnings per share is defined as net income (loss) from continuing operations attributable to common stockholders adjusted to reflect adjustments consistent with the Company’s definition of adjusted EBITDA. Additionally, the Company el