Advansix Inc. · NYSE:ASIX
Advansix — Q1 2019 Earnings Presentation
16 slides from Advansix's earnings presentation, May 3, 2019
Slide 1: 1Q 2019 Earnings Presentation
May 3, 2019 1Q 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 • 1Q19 Sales $315M, down (12%) driven by lower raw material pass through • 1Q19 pre-tax income results include (~$8M) unfavorable impact from phenol force majeure and ~$6.6M insurance proceeds related to the 1Q18 weather event claim • 1Q19 Net Income $20M, up 74%; EBITDA $42M, up 36% • 1Q
Slide 4: 1Q 2019 Financial Summary
1Q 2019 Financial Summary 4 Successfully Navigated Through Shortages of Key Raw Material ($ Millions, Except Per Share Amounts) 1Q 2018 1Q 2019 Comments • Sales Down (12%): Volume (3%), Price (9%) Sales $359.2 $314.9 – Raw Material Pass Through (12%), Market Pricing +3% • ~$6.6M Insurance Proceeds R
Slide 5: Nylon Industry Outlook
Nylon Industry Outlook 5 Macro Uncertainty for Carpet and Auto End Markets Nylon Key Industry Spreads (1) 1Q19 YoY 1Q19 vs. 4Q18 • Macro uncertainty for carpet and auto end markets Global Composite BNZ-CPL (9%) (9%) What We’re • China utilization rates continuing Asia BNZ-CPL (9%) (25%) Seeing to fl
Slide 6: Nylon Films Strategic Alliance
Nylon Films Strategic Alliance 6 Capital Efficient and Highly Synergistic Combination to Meet Industry Needs Total ASIX Sales Films • 2018 Sales: ~$34M Chemical • Attractive long-term growth rates Intermediates Nylon Business Overview – Macro trend shift from rigid to flexible packaging • Manufactur
Slide 7: Ammonium Sulfate (AS) Industry Outlook
Ammonium Sulfate (AS) Industry Outlook 7 Nitrogen Fertilizer Environment Expected to Strengthen Seasonally Through Spring Planting Ammonium Sulfate Key Industry Prices (1) 1Q19 YoY 1Q19 vs. 4Q18 • AS price movement modest Corn Belt Granular AS 0% (3%) relative to recent nitrogen pricing Corn Belt Ur
Slide 8: Chemical Intermediates Industry Outlook
Chemical Intermediates Industry Outlook 8 Global Acetone Supply Continuing to Lengthen Chemical Intermediates Key Industry Prices (1) 1Q19 YoY 1Q19 vs. 4Q18 • Acetone imports and soft Acetone, Small/Medium Buyer (32%) (20%) downstream demand pressuring regional pricing – industry Acetone, Large Buye
Slide 9: Cash Flow And Capital Deployment
Cash Flow And Capital Deployment 9 Maturing Deployment Strategies Trailing 12-Month Cash Flow Capital Deployment Framework ($ Millions) • Internal reinvestment remains top priority 190 • Base capex to support safe and stable operations Capex • Executing against multi-year $150-$200M pipeline of 170
Slide 10: Full Year 2019 Outlook
Full Year 2019 Outlook 10 Expect Improved Performance in 2019 • Nylon: targeting strong nylon plant utilization rates while navigating through uncertain carpet and auto end markets Commercial • Ammonium Sulfate: nitrogen fertilizer environment expected to strengthen seasonally through Spring plantin
Slide 11: Appendix
11 Appendix 1Q 2019 Earnings Presentation – May 3, 2019
Slide 12: Capital Expenditures
Capital Expenditures 12 Execution of High-Return Growth and Cost Savings Projects in 2019 Growth/Cost Savings $140-$150M • Executing against multi-year $150-$200M pipeline of high- return projects; 20%+ IRR target $109M ~33% ~2018 Levels • Relocation of R&D lab to Chesterfield from Colonial Heights
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 2019E -- ~$5M ~$5M $25-$30M $35-$40M In-line with 2020E -- -- historical averages • Timing driven by compliance, inspection and sustaining asset base • C
Slide 14: Reconciliation of non-GAAP Measures to GAAP Measures
14 Appendix: Reconciliation of non-GAAP Measures to GAAP Measures 1Q 2019 Earnings Presentation – May 3, 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) EBITDA margin is defined as EBITDA divided by Sales The Company believes these non-GAAP financial measures provide meanin