Element Solutions Inc. · NYSE:ESI
Element Solutions — Platform Specialty Products — Barclays Electronic Chemicals Conference 2018
25 slides from Element Solutions's conference presentation, May 14, 2018
Slide 1: Barclays Electronic Chemicals Conference
Barclays Electronic Chemicals Conference May 14, 2018 1
Slide 2: Safe Harbor
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 statements made by or o
Slide 3: Non-GAAP Information
NON-GAAP INFORMATION To supplement the financial measures prepared in accordance with generally accepted accounting principles in the United States (“GAAP”), the Company uses the following non-GAAP financial measures: EBITDA and adjusted EBITDA, adjusted EBITDA margin, adjusted EBITDA guidance, cash
Slide 4: Presenters
PRESENTERS BEN GLIKLICH EVP, Operations & Strategy JOE D’AMBRISI SVP, MacDermid Electronic Solutions 4
Slide 5: Introduction to Platform
INTRODUCTION TO PLATFORM Global diversified specialty chemicals company focused on marketing-leading, high quality, and high cash-flow businesses 2017 Key Statistics 2017 Net Sales Breakdown By Segment By Geography ▪ Net Sales: $3,776M ▪ Adj. EBITDA*: $821M Asia EMEA 27% 33% Performance ▪ Adj. EBITD
Slide 6: Arysta LifeScience Highlights
ARYSTA LIFESCIENCE HIGHLIGHTS Attractive, niche-focused, and differentiated formulation-orientated crop chemicals business ▪ Distinctive position as formulation-based Ag chemical company with global scale and niche crop focus Strong Industry ▪ Industry innovator that develops new solutions for farme
Slide 7: Performance Solutions Highlights
PERFORMANCE SOLUTIONS HIGHLIGHTS ▪ A market leader in specialty chemicals for surface treatment and electronic assembly Leading Market ▪ High-touch sales force embedded with customers Positions ▪ Leading specialty chemical supplier selling more than $1.6 billion of surface chemistry and assembly sol
Slide 8: MacDermid Performance Solutions (MPS) Overview
MACDERMID PERFORMANCE SOLUTIONS (MPS) OVERVIEW $1.9Bn 2017 Net Sales $433M 2017 Adj. EBITDA1* INDUSTRIAL SOLUTIONS ELECTRONIC SOLUTIONS GRAPHIC SOLUTIONS OFFSHORE SOLUTIONS ▪ Corrosion resistance ▪ Circuit board metallization ▪ Solder paste ▪ Flexographic ▪ Temperature and PRODUCTS ▪ Decorative fini
Slide 9: MPS Electronics Overview
MPS ELECTRONICS OVERVIEW Diverse and market leading positions in electronics-oriented businesses ELECTRONIC SOLUTIONS ADVANCED ELECTRONIC SOLUTIONS ▪ Metallization ▪ Damascene copper ▪ Fluxes ▪ Adhesives and functional ▪ Final finishes ▪ Wafer level packaging ▪ Solder paste bonding films ▪ Memory di
Slide 10: MPS Electronics 101
MPS ELECTRONICS 101 PLATFORM SPECIALTY PR UCTS CORPORATION mn 10
Slide 11: MPS Electronics – Expertise at Every Step
MPS ELECTRONICS – EXPERTISE AT EVERY STEP Our experts consult at every step of the global electronics manufacturing supply chain 11
Slide 12: MPS Electronics Case Study – Mobile Phone Content
MPS ELECTRONICS CASE STUDY – MOBILE PHONE CONTENT PCB Plating Solder Balls, Flux Flexible circuit: Solder Paste Direct Metallization Silicon processors MEIS Treatments Damascene Cu Damascene Cu Advanced Packaging Adhesives Source: Management 12
Slide 13: MPS Electronics – Integral to Electronics Manufacturing
MPS ELECTRONICS – INTEGRAL TO ELECTRONICS MANUFACTURING Source: Management 13
Slide 14: Compelling Long-Term Growth Drivers for MPS Electronics
COMPELLING LONG-TERM GROWTH DRIVERS FOR MPS ELECTRONICS Automotive Electronics – Cars Mobile Device Complexity Laptop Television Wireless Infrastructure Desktop Durability / Reliability Source: Management 14
Slide 15: Appendix
PLATFORM SPECIALTY PR UCTS CORPORATION rl APPENDIX 15
Slide 16: Full Year 2018 Guidance
FULL YEAR 2018 GUIDANCE Performance Solutions Agricultural Solutions ▪ Generally healthy end-markets driven by overall ▪ Expect modest growth in overall market in 2018 economic growth and secular trends supporting high- Market ▪ Tighter supply of active ingredients from China performance electronics
Slide 17: Capital Structure
CAPITAL STRUCTURE $ millions Instrument Maturity Coupon 3/31/2018 Corporate Revolver 6/7/2020 $52 Term Loan B6 - USD 1,2 6/7/2023 L + 300 1,135 Term Loan B7 - USD 1 6/7/2020 L + 250 630 Term Loan C5 - EUR 1,2 6/7/2023 E + 275 739 Term Loan C6 - EUR 1 6/7/2020 E + 250 719 Other Secured Debt 19 Total
Slide 18: Reconciliation to Adjusted Share Counts
RECONCILIATION TO ADJUSTED SHARE COUNTS (in millions) Q1 2018 Basic outstanding shares 288 Number of shares issuable upon conversion of PDH Common Stock 4 Number of shares issuable upon conversion of Series A Preferred Stock 2 Number of shares issuable upon vesting and exercise of Stock Options 1 Nu
Slide 19: Net Loss Attributable to Common Stockholders Reconciliation to Adj. EBITDA
NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS RECONCILIATION TO ADJ. EBITDA (Amounts in millions) FY 2017 FY 2016 FY 2015 FY 2014 Net loss attributable to common stockholders $(296) $(41) $(309) $(263) Add (subtract): Gain on amendment of Series B Convertible Preferred Stock — (33) — — Stock dividend
Slide 20: Segment Comparable Sales Reconciliation
SEGMENT COMPARABLE SALES RECONCILIATION Performance Solutions Agricultural Solutions (amounts in millions) 2015 2014 2015 2014 Net Sales $801 $755 $1,742 $88 Acquisitions: Alent 847 1,063 OM 142 172 Arysta 87 1,533 CAS 380 Agriphar 170 Comparable Sales $1,791 $1,990 $1,829 $2,171 20 Note: Totals may
Slide 21: Segment EBITDA Reconciliation
SEGMENT EBITDA RECONCILIATION Performance Solutions Agricultural Solutions Total (amounts in millions) 2017 2016 YoY% 2017 2016 YoY% 2017 2016 YoY% Adj. EBITDA $433 $401 8% $388 $368 5% $821 $769 7% Corporate allocations 31 33 31 33 $63 66 Adj. EBITDA ex-corp cost $464 $434 7% $420 $401 5% $884 $835
Slide 22: Segment Comparable EBITDA Reconciliation
SEGMENT COMPARABLE EBITDA RECONCILIATION Performance Solutions Agricultural Solutions Total (amounts in millions) 2015 2014 YoY% 2015 2014 YoY% 2015 2014 YoY% Adj. EBITDA ex-corp cost $236 $212 11% $379 $16 n/m $616 $228 n/m Acquisitions: Alent 143 175 143 175 OM 28 30 28 30 Arysta 3 293 3 293 CAS 9
Slide 23: Quarterly Results Overview
QUARTERLY RESULTS OVERVIEW 2017 2018 (Amount in millions) Q1 Q2 Q3 Q4 Q1 Net Sales Performance Solutions $447 $462 $481 $489 $492 Agricultural Solutions 415 479 424 580 472 Total Net Sales $862 $941 $904 $1,069 $964 Adjusted EBITDA Performance Solutions $102 $103 $116 $112 $112 Agricultural Solution
Slide 24: Organic Sales Growth Reconciliation
ORGANIC SALES GROWTH RECONCILIATION FY 2017 Organic Sales Growth Reported Net Impact of Constant Organic Sales Metals Acquisitions Sales Growth Currency Currency Growth Performance Solutions 6% —% 6% (1)% —% 4% Agricultural Solutions 4% (2)% 3% —% —% 3% Total 5% (1)% 4% (1)% —% 4% 24 Note: Totals ma
Slide 25: Non-GAAP Definitions
NON-GAAP DEFINITIONS EBITDA and Adjusted EBITDA: EBITDA represents earnings before interest, provision for income taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA, excluding the impact of additional items, which are not representative or indicative of the Company’s ongoing
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