Advansix Inc. · NYSE:ASIX
Advansix — Stifel Virtual Cross Sector Insight Conference (June 2020)
21 slides from Advansix's conference presentation, Jun 9, 2020
Slide 1: Stifel Virtual Cross Sector Insight Conference
Stifel Virtual Cross Sector Insight Conference June 9, 2020
Slide 2: Forward Looking Statements
Forward Looking Statements 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 or
Slide 3: AdvanSix At A Glance
AdvanSix At A Glance AdvanSix is a Leading Producer of Nylon 6 and Intermediate Chemicals Profile 2019 Revenue Breakdown • NYSE: ASIX By Product By Region By End Market • Spin-off from Honeywell: Asia: $52M EMEA: $35M Coatings, Other Chemical October 1, 2016 Intermediates: Nylon: LatAm/Canada: Adhes
Slide 4: Portfolio Overview
Portfolio Overview Leading North American Position Across Industries Served Nylon Ammonium Sulfate Chemical Intermediates Vertically integrated producer with Key co-product portfolio delivering High quality products serving Description industry-leading cost position on sulfur nutrition value proposi
Slide 5: Investment Highlights
Investment Highlights Sustainable Low Cost Position • Vertical integration and scale • Advantaged location – raw materials, access to high value end markets • Co-product net back optimization Diverse Revenue Sources And Strong Customer Relationships With Global Reach • Three product lines serving mu
Slide 6: Vertically Integrated Manufacturing Sites
Vertically Integrated Manufacturing Sites Competitive Advantage Derived from Significant Scale, Integration and Diverse Revenue Streams Frankford Plant Hopewell Plant Chesterfield Plant Cumene is converted into Phenol, 75%-80% of Phenol produced at ~60% of the Caprolactam produced Acetone & Alpha-Me
Slide 7: Sustainable Lowest Cost Position
Sustainable Lowest Cost Position Vertical • Fully backward integrated into several key Integration feedstock materials Global Caprolactam Supply / Cost Landscape • One of world’s largest single-site producers of Global Demand Overcapacity Industry- Caprolactam Leading • Significant operating leverag
Slide 8: Prepared To Navigate Through Near-Term Dynamics
Prepared To Navigate Through Near-Term Dynamics Focus on Safe, Stable and Sustainable Operations • 1Q20 Results Reflect Strength of Vertical Integration and Low-Cost Position • COVID-19 – Business Designated as Essential Critical Infrastructure – Health and Safety of Our Employees is Top Priority –
Slide 9: COVID-19 Response Summary
COVID-19 Response Summary Health and Safety Focus; Disciplined Cost and Cash Management • Health and safety of employees is top priority • Designated as essential critical infrastructure during COVID-19 response Health, • Business continuity plans supporting safe and stable operations, while continu
Slide 10: COVID-19 Industry Impact
COVID-19 Industry Impact Adjusting Output to Changes in Mix and Demand Potential Impact By Key End Market High Exposure Textile • Auto demand reduction globally impacts nylon Automotive (engineered plastics) and chemical intermediates Consumer Durables • Textile recovery slow, export demand out of C
Slide 11: COVID-19 – Implications Of U.S. Refinery Utilization
COVID-19 – Implications Of U.S. Refinery Utilization Ability to Perform in Any Energy Environment Key Considerations AdvanSix Pricing Mechanisms • Formula/Index-based pass through pricing mechanisms on ~50% of total ASIX revenue base Formula / Index Pricing ✓ Market Based Pricing ✓ (~50% of total Sa
Slide 12: 2020 Outlook
2020 Outlook Mitigating COVID-19 Risks; Focused Cost Management and Capital Discipline Considerations 2020 Outlook Impacting Outlook • Demand weakness expected to continue; COVID-19 further challenging industry • Residential / Non-Res construction Nylon conditions • Auto demand recovery • Reduced gl
Slide 13: Sustainability
Sustainability Continued Commitment to Environmental, Social and Economic Sustainability EcoVadis Gold Rating NOx Reduction • Upon spin-off, completed ~$100M multi-year investment at • Awarded a Gold Rating for corporate social Hopewell to reduce NOx emissions responsibility (CSR) by EcoVadis, an 15
Slide 14: APPENDIX
APPENDIX SL powsv
Slide 15: 1Q 2020 Financial Summary
1Q 2020 Financial Summary Results Reflect Vertical Integration and Global Low-Cost Position ($ Millions, Except Per Share Amounts) 1Q 2019 1Q 2020 Comments • Sales Down (~4%): Volume +6.5%, Price (10.4%) Sales $314.9 $302.7 – Market Pricing (11.5%), Raw Material Pass Through +1.1% • Unfavorable Impa
Slide 16: 1Q 2020 EBITDA Bridge
1Q 2020 EBITDA Bridge Lower Market Pricing Partially Offset By Volume, Raws and Productivity Benefits ($M) $14 • Lower Natural Gas and Sulfur $37 costs $10 $42 $2 $1 $3 • CPL/Nylon • Higher Volume • Benefits from Nat $29 • AS: higher Gas Boilers standard export sales • Prior year impacts of insuranc
Slide 17: Industry Pricing And Spreads
Industry Pricing And Spreads Nylon Ammonium Sulfate Chemical Intermediates 1Q20 YOY 1Q20 vs. 4Q19 1Q20 YOY 1Q20 vs. 4Q19 1Q20 YOY 1Q20 vs. 4Q19 Global Composite (31%) (6%) Acetone, Sm/Med Buyer 0% 10% Asia BNZ-CPL (43%) (11%) Corn Belt Granular AS (8%) (1%) Acetone, Large Buyer (13%) (7%) Asia CPL-R
Slide 18: Planned Plant Turnarounds
Planned Plant Turnarounds Pre-Tax Income Impact by Quarter (1) 1Q 2Q 3Q 4Q FY 2017 -- ~$10M ~$4M ~$20M ~$34M 2018 ~$2M ~$10M ~$30M -- ~$42M 2019 -- ~$5M ~$5M ~$25M ~$35M 2020E ~$2M $5-$10M ~$20M ~$3M $30-$35M • Timing driven by compliance, inspection and sustaining asset base • Critical to supportin
Slide 19: Reconciliation of Non-GAAP Measures to GAAP Measures
APPENDIX Reconciliation of Non-GAAP Measures to GAAP Measures 19
Slide 20: Reconciliation Of Net Cash Provided By Operating Activities To Free Cash Flow
Reconciliation Of Net Cash Provided By Operating 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 investor
Slide 21: Reconciliation Of Net Income To EBITDA
Reconciliation Of Net Income To EBITDA (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 the non-GAAP financial measures included in this pr
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