Slide 1: First Quarter 2023 Earnings Presentation
First Quarter 2023 Earnings Presentation April 28, 2023
Slide 2: Forward-Looking Statements
Forward-Looking Statements: This presentation includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to analyses and other information that are based on management's beliefs, certain assumptions made by management, fore
Slide 3: Results & Outlook
Results & Outlook 1Q23 Highlights • Began adjusting CAPV market participation across the ECU to slow Olin caustic deterioration and improve Olin chlorine outlook • Olin merchant chlorine, caustic soda and bleach pricing improved sequentially • Commercial ammunition market inventory is normalizing •
Slide 4: Quarterly Business Updates
Quarterly Business Updates Historical Performance Situation, Initiatives & Outlook Quarterly Adjusted EBITDA ($US Million) • Very slow China recovery • Europe seeing more slowdown $236 EPOXY $193 $186 $158 $160 • Business restructuring actions being taken to lift the trough $51 $39 $33 $100 $36 • Re
Slide 5: An Update on Our Evolution
An Update on Our Evolution • Focus on system value over volume via a unique model – Pivoting our market participation to lift the ECU – Chlorine and bleach prices moving up • Shareholder friendly capital allocation – Fully utilizing our current recession 12% LFCF yield • Lifting People & Culture of
Slide 6: Appendix
Appendix
Slide 7: ESG Quarterly Highlight
ESG Quarterly Highlight Winchester’s new robotic packaging eliminates the need for bulky, non-renewable foam trays, while adding multiple dimensions of visual inspection to improve product quality This reduces annual packaging materials by 350,000 LBS and eliminates 50,000 LBS of carbon emissions pe
Slide 8: Environmental
ESG SCORECARD 2022 % Change Climate: Olin Corporation, Global Operations 2022 2021 from baseline 1, 6 Target (year) Total Energy (Direct & Indirect) (MM GJ) 74.1 83.1 -23% % Electricity from Renewable Energy/Low Carbon Sources 2 7.1% 7.2% 20% Scope 1 CO2e Emissions (Million Mt CO2e) (Includes Trucki
Slide 9: Chlorine: 1Q23 ECU PCI Parlay Volume Tracker
1Q23 ECU PCI Parlay Volume Tracker 18% 16.1% % Parlay Tons / Total Quarterly Sales Volume1 16% 294 14% 287 12.2% 261 255 262 12% 10.6% 238 222 9.7% 9.8% Index 10% 8.7% 192 8.1% 7.5% 8% 6.4% 148 6% 4.6% 100 100 106 Olin - ECU PCI 93 4% Winning model generated improvement – Olin ECU remains undervalue
Slide 10: 2023 Levered Free Cash Flow estimated to be ~$965 million
2023 Levered Free Cash Flow (LFCF) estimated to be ~$965 million ($ in millions) $325 $50 $225 $165 $120 Primary uses of 2023 LFCF: • Share repurchases • Shareholder dividends • Alliance/Joint Venture opportunities ~$1.75 Billion Cash Taxes 2 Change in Capital Interest 5 Other ~$965 Million 2023 Adj
Slide 11: Strong financial profile for a challenging economic environment
Strong financial profile for a challenging economic environment 2021 + 2022 2023 OUTLOOK • 2021 - $2.5 Billion • Recessionary trough level ADJUSTED • 2022 - $2.4 Billion Adjusted EBITDA EBITDA ~$4.9 Billion ~$1.6 – $1.9 Billion • Debt reduction $1.3B • Disciplined capital allocation LEVERED FREE • S
Slide 12: Resetting the adjusted EBITDA floor in a recession scenario
Resetting the adjusted EBITDA floor in a recession scenario VERSUS $2.8bn VERSUS 2020 Adjusted EBITDA1 [$636 mm Adjusted EBITDA] Our Resilient Model Economic Our Bottom-Up Build We can go deep, in withdrawing Recession-Case: • Merchant Cl2 pricing + $500+ mm from poor quality markets. Holding our pr
Slide 13: BWA is our First Inorganic CAPV Growth Vector
BWA is our First Inorganic CAPV Growth Vector North America 1,691Mt Reduce Emissions Increase Participation in Global Liquidity Value for Value for Olin Mitsui 13
Slide 14: Winchester Segment Performance
Winchester Segment Performance Sales Adjusted EBITDA (in millions) (in millions) $366.5 $320.0 $67.2 $52.1 Sequential: 1Q23 vs 4Q22 – Higher commercial volumes – Higher military and law enforcement sales 4Q 2022 1Q 2023 4Q 2022 1Q 2023 +15% +29% $426.7 $125.1 $366.5 Year-Over-Year: 1Q23 vs 1Q22 – Lo
Slide 15: Chlor Alkali Segment Performance
Chlor Alkali Segment Performance Sales Adjusted EBITDA (in millions) (in millions) $1,172.8 $369.9 $360.3 $1,117.1 Sequential: 1Q23 vs 4Q22 – Lower volumes, focusing on value vs. volume – Higher ECU contributions 4Q 2022 1Q 2023 4Q 2022 1Q 2023 -5% -3% $1,245.2 $451.7 $1,117.1 $360.3 Year-Over-Year:
Slide 16: Epoxy Segment Performance
Epoxy Segment Performance Sales Adjusted EBITDA (in millions) (in millions) $52.9 $484.2 Sequential: 1Q23 vs 4Q22 $360.7 $35.9 – Lower epoxy volume, primarily focusing on value vs. volume – Lower margins due to lower pricing, partially offset by lower benzene and propylene 4Q 2022 1Q 2023 4Q 2022 1Q
Slide 17: Outlook: Full year 2023 modeling assumptions
Outlook: Full year 2023 modeling assumptions ($ in millions) Line Item Forecast Key Elements Capital Spending $200 to $250 Expected to be similar to 2022 levels Depreciation & Amortization $550 to $575 Expected to be lower than 2022 levels Payments under long-term Participation in energy project $50
Slide 18: Non-GAAP Financial Measures – Adjusted EBITDA
Non-GAAP Financial Measures – Adjusted EBITDA (a) Olin's definition of Adjusted EBITDA (Earnings before interest, taxes, depreciation, and amortization) is net income (loss) plus an add-back for depreciation and amortization, interest expense (income), income tax expense (benefit), other expense (in
Slide 19: Non-GAAP Quarterly Financial Measures by Segment
Non-GAAP Quarterly Financial Measures by Segment (a) Three Months Ended Three Months Ended Three Months Ended March 31, 2023 December 31, 2022 March 31, 2022 Depreciation Depreciation Depreciation Income (loss) Reconciling and Adjusted Income (loss) Reconciling and Adjusted Income (loss) Reconciling