Olin Corporation · NYSE:OLN
Olin — UBS Warburg Grass Roots Chemical Conference 2005
15 slides from Olin's conference presentation, Feb 14, 2005
Slide 1: Presentation on the North America Chlor Alkali Industry
Presentation on the North America Chlor Alkali Industry Prepared for UBS Warburg Grass Roots Chemical Conference New Orleans, LA February 16, 2005 By John L. McIntosh President, Chlor Alkali Products Olin Corporation
Slide 2: Olin Is Leading Producer in Eastern Half of US
Olin Is Leading Producer in Eastern Half of US Source: CMAI Chlor Alkali Report 4th Overall in U.S. Capacity Largest Producer East of the Mississippi River Olin Has 1.22 Million ECU Capacity Per Year (1) A $10 / ECU Change Equates to an $12 Million Change in Pretax Income at Full Capacity, or $.11 p
Slide 3: North America 2004 Chlorine Demand
North America 2004 Chlorine Demand United States 92% Domestic Demand = 13.3 Million Metric Tons Inorganics 6% Others 14% Chlorinated Inter. 9% Vinyls 39% Organics 26% Pulp & Paper 1% Water Treatment 5% Mexico 3% Canada 5% Houston London Singapore Dubai Prepared exclusively for Olin
Slide 4: North America Chlorine Demand
North America Chlorine Demand Million Metric Tons 15 12 9 6 3 0 99 00 01 02 03 04 05 06 07 08 09 Houston London Singapore Dubai Prepared exclusively for Olin %AAGR 2004-09 Vinyls -0.6 Organics 2.4 Chlorinated Inter. -0.4 Inorganics -0.1 Pulp & Paper -4.6 Water Treatment 1.4 Others 1.2 %AAGR Demand 0
Slide 5: North America 2004 Caustic Soda Demand
North America 2004 Caustic Soda Demand Others 12% Water Treatment 3% United States 86% Pulp & Paper 25% Inorganics 22% Alumina 4% Mexico 4% Organics 24% Soaps/Detergents/Textiles 10% Canada 10% Domestic Demand = 13.5 Million Dry Metric Tons Houston London Singapore Dubai Prepared exclusively for Oli
Slide 6: North America Caustic Soda Demand
North America Caustic Soda Demand Million Dry Metric Tons %AAGR 2004-09 Pulp & Paper 1.0 Alumina -1.3 Organics 1.8 Soaps/Deterg./Textiles 0.7 Inorganics 1.2 Water Treatment 1.7 Others 1.6 %AAGR Demand 1.2% 15 12 9 6 3 0 99 00 01 02 03 04 05 06 07 08 09 Houston London Singapore Dubai Prepared exclusi
Slide 7: North America Chlor Alkali Forecast
North America Chlor Alkali Forecast North America Chlor Alkali Capacity Expansions Since 2000 Company Location Short Tons as Chlorine Vulcan C-A Geismer, LA 214,500 Westlake Calvert City, KY 48,400 Oxy Muscle Shoals, AL 13,200 Oxy Delaware City, DE 4,400 Oxy Mobile, AL 4,400 SunBelt Mobile, AL 40,00
Slide 8: 2004 Price Increase Announcements
2004 Price Increase Announcements Feb: Chlorine $75 per ton Apr: Caustic $50 per ton May: Chlorine $20 per ton; Caustic $45 July: Caustic $65 per ton September: Chlorine $20; Caustic $45 November: Chlorine $20;Caustic $50 per ton Total Chlorine: $135; Caustic: $255 *Caustic Price Increases Shown are
Slide 9: CMAI Estimates of ECU Prices
CMAI Estimates of ECU Prices* (For Chlorine to Chemicals and Diaphragm Grade Caustic) $700 $600 $500 $400 $300 $200 $100 $0 * Gross Selling Prices in the Gulf Coast Region 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Slide 10: 2004 Industry Highlights
2004 Industry Highlights Chlorine and caustic demand grew 6.0% over 2003 levels improving operating rates to near capacity ECU prices have increased to record levels by fourth quarter of 2004 The Chlor-Alkali business cycle is approaching the next peak 2005/2006. The last cycle peak was 1995/1996, s
Slide 11: Olin Chlor Alkali Products
Olin Chlor Alkali Products Products End Uses Chlorine / Caustic Soda Pulp & paper processing, chemical manufacturing, water purification, manufacture of vinyl chloride, bleach, swimming pool chemicals & urethane chemicals Sodium Hydrosulfite Paper and clay bleaching Textile dye reducing agent Hydroc
Slide 12: Impact of High Chlorine Prices on Chlor Alkali Profitability
Impact Of High Chlorine Prices On Chlor Alkali Profitability Chlorine Buyers are Highly Concentrated Some Large Chlorine Buyers Have Contractual Caps and /or Discounts Which Dampen Impact of Price Increases at High End of Contract Range Chlorine Contracts are Multi-Year and Recognize Cycle Pricing T
Slide 13: Caustic Price Increases Are A Key to Higher ECU Values
Caustic Price Increases Are A Key to Higher ECU Values Historically, Olin’s Chlor Alkali Business Has Seen Peak Earnings During Times of High Caustic Prices Caustic Customers are Smaller and More Numerous Caustic Demand Improvement Normally Lags Chlorine by Six Months Olin Sells 10% More Caustic Tha
Slide 14: Olin's Chlor Alkali Strategy
Olin’s Chlor Alkali Strategy Be the Preferred Supplier to Non-Integrated Chlor Alkali Customers Continue to Drive Cost Improvements Through Manufacturing and Logistic Optimization Continue Our Partnership Philosophy With Our Customers Significant Opportunities to Increase the Value of the Business a
Slide 15: Cautionary Language
Cautionary Language This presentation includes estimates of future performance. These are forward-looking statements and results could differ materially from those projected. Some of the factors that could cause actual results to differ are described in the outlook section of our most recent 10-K an
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