Slide 1: Earnings conference call first-quarter fiscal 2023
earnings conference call first-quarter fiscal 2023 February 1, 2023 I 9:00 am ET
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Ashland has identified some of these forward-looking statements with words
Slide 3: Agenda
Q]1 performance summary Q1 financial results outlook closing comments Q&A
Slide 4: Q1 performance summary
*<f Ashland always solving
Slide 5: Key drivers in Q1 vs. prior year
key drivers in Q]1 vs. prior year tailwinds continued inflation-recovery pricing and mix ° pricing improved double-digits percent for all segments (constant currency) ° improved product mix within Life Sciences, Personal Care and Specialty Additives strong results for Life Sciences ° strong global d
Slide 6: Q1 sales, adjusted EBITDA and adjusted EPS
sales adjusted EBITDA adjusted EBITDA % adjusted EPS2 +3 % +2 % (10) bps +10 % $525 MM $108 MM 20.6 % $0.97 strong pharma and inflation recovery / mix sustained quality double-digit offset by regional margins offset by broad-based planned turnaround adjusted EPS destocking & planned inflation recove
Slide 7: Sales growth impacted by regional dynamics with consistent Adj. EBITDA margins
sales1 growth impacted by regional dynamics with consistent Adj. EBITDA margins for Ashland 2 2
Slide 8: Q1 financial results
*<f Ashland always solving
Slide 9: Fiscal-first quarter adjusted results
fiscal-first quarter adjusted results! operating results summary (SUS in millions, except percentages) Ql FY23 Ql FY22 sales $525 $512 gross profit margin 31.4% 31.4% SG&A / R&D costs / intangible amortization $116 $115 operating income $50 $46 EBITDA $108 $106 EBITDA margin 20.6 % 20.7 % EPS (exclu
Slide 10: Q1 FY23 year-over-year sales: pharma, nutraceuticals, nutrition
o o o o o -DD No change +DD pharma nutraceuticals nutrition & other Q1 FY23 year-over-year sales (HSD/MSD/LSD = high, mid or low single-digit %. DD = double-digit %)
Slide 11: Q1 FY23 year-over-year sales: skin care, hair care, oral care, household
o o o -HSD -DD -HSD o +LSD skin care hair care oral care household Q1 FY23 year-over-year sales (HSD/MSD/LSD = high, mid or low single-digit %. DD = double-digit %)
Slide 12: Q1 FY23 year-over-year sales: coatings, construction, energy, performance
o o o o o -MSD -DD u o coatings construction, energy, performance spec. Q1 FY23 year-over-year sales (HSD/MSD/LSD = high, mid or low single-digit %. DD = double-digit %)
Slide 13: Q1 FY23 year-over-year sales: merchant, captive
o o o -HSD +DD u merchant captive Q1 FY23 year-over-year sales (HSD/MSD/LSD = high, mid or low single-digit %. DD = double-digit %)
Slide 14: Strong balance sheet
strong balance sheet strong financial position with increased flexibility new share repurchase under $500 million evergreen share repurchase authorization ° new $100 million Rule 10b5-1 trading plan agreement planned for February ° $400 million expected under the current evergreen authorization afte
Slide 15: Outlook
*<f Ashland always solving
Slide 16: Outlook perspective
outlook perspective Q2 developments second-half FY23 implications o demand resilience global recession o January demand improving ° pharma resilience China re-opening © ater book rebounding vs QI geopolitical outlook in Europe ° China remains weak © destocking dynamics stabilizing o — inflation outl
Slide 17: Outlook
outlook maintain full-year guidance (models below midpoint) forward looking insights ° 17 end-market resilience consistent with historical trends current internal models within guidance range but below midpoint HEC and acetylenic market capacity utilization remains >90% continued pricing and mix car
Slide 18: Closing comments
*<f Ashland always solving
Slide 19: Ashland
Ashland focused additives and specialty ingredients company leadership positions in high-quality markets and with exciting profitable growth opportunities ° flexible, agile strong technology, commercial and ° consistent execution operations capabilities . global infrastructure ° solid growth compell
Slide 20: Q&A
*<f Ashland always solving
Slide 21: Appendix A: adjusted results
appendix A: adjusted results summary and balance sheet «<f Ashland always solving
Slide 22: All figures presented on an adjusted basis
1 All figures are presented on an adjusted basis except Sales and Diluted share count (million shares). Appendix B reconciles adjusted amounts to amounts reported under GAAP, including reconciliations of net income to EBITDA and adjusted EBITDA, operating income to adjusted operating income, income
Slide 23: Q1 business unit consolidation
Q1 business Unit Consolidation! mp specialty itercompany unallocated SI ano i eliminations? ‘and other? gross profit $165 EBITDA ($22) $108 1 All figures are presented on an adjusted basis except Sales. Appendix B reconciles adjusted amounts to amounts reported under GAAP, including reconciliations
Slide 24: Debt expiration, interest rate and ratings
Moody’s 12/31/22 ($US in millions) expiration interest rate S&P rating rating balance
Slide 25: Appendix B: non-GAAP reconciliation
appendix B: non-GAAP reconciliation! Although Ashland provides forward looking guidance for adjusted EBITDA in this presentation, Ashland is not reaffirming or providing forward-looking guidance for U.S. GAAP reported financial measures or a reconciliation of forward-looking non-GAAP financial measu
Slide 26: Reconciliation of Non-GAAP Data
Ashland Inc. and Consolidated Subsidiaries Reconciliation of Non-GAAP Data for 12 Months Ended December 31, 2022 ($ millions, except percentages) Sales1 Q1 23 Q4 22 Q3 22 Q2 22 Total Q1 22 Life Sciences $ 207 $ 213 $ 228 $ 204 $ 852 $ 170 Personal Care 138 188 172 172 670 147 Specialty Additiv es 14
Slide 27: Segment components of key items, three months ended December 31, 2022
Ashland Inc. and Consolidated Subsidiaries . Segment Components of Key Items for Applicable lacame Statement Captions In millions - preliminary and unaudited) ($ millions) Three Months Ended December 31, 2022 Life Personal Specialty Intermediat Unallocated Sciences Care Additives es & Other Total OP
Slide 28: Segment components of key items, three months ended December 31, 2021
Ashland Inc. and Consolidated Subsidiaries . Segment Components of Key Items for Applicable Income Statement Captions In millions - preliminary and unaudited) ($ millions) Three Months Ended December 31, 2021 Life Personal Specialty Intemediat Unallocated Sciences Care Additives es & Other Total OPE
Slide 29: Free Cash Flow and Adjusted Operating Income
Ashland Inc. and Consolidated Subsidiaries Reconciliation of Non-GAAP Data – Free Cash Flow and Adjusted Operating Income
Slide 30: Reconciliation of Non-GAAP Data – Adjusted EBITDA
Ashland Inc. Reconciliation of Non-GAAP Data – Adjusted EBITDA for 3 Months Ended December 31, 2022 and 2021 ($ millions)
Slide 31: Reconciliation of Non-GAAP Data – Adjusted EBITDA
Ashland Inc. Reconciliation of Non-GAAP Data – Adjusted EBITDA for 3 Months Ended December 31, 2022 and 2021 ($ millions)
Slide 32: Specialties Additives and Intermediates Adjusted EBITDA
Specialties Additives and Intermediates Reconciliation of Non-GAAP Data – Adjusted EBITDA for 3 Months Ended December 31, 2022 and 2021 ($ millions)
Slide 33: Adjusted Income from Continuing Operations
Ashland Inc. and Consolidated Subsidiaries Reconciliation of Non-GAAP Data – Adjusted Income from Continuing Operations ($ millions)
Slide 34: Adjusted Diluted EPS from Continuing Operations
Ashland Inc. and Consolidated Subsidiaries Reconciliation of Non-GAAP Data – Adjusted Diluted EPS from Continuing Operations
Slide 35: Ashland
OT <t Ashland always solving