Avient Corporation · NYSE:AVNT
Avient — Investor Day (December 2021)
139 slides from Avient's investor day presentation, Dec 9, 2021
Slide 1: Shaping a Sustainable Future
Investor Day 2021 December 9, 2021 Shaping a Sustainable Future (NYSE: AVNT)
Slide 2: Agenda
Agenda 8:00 WELCOME BREAKFAST 9:00 WE ARE AVIENT: Bob Patterson 9:15 BETTER TOGETHER AND CUSTOMER EXPERIENCE: Norbert Merklein 9:45 LONG-TERM ORGANIC GROWTH DRIVERS: Sustainable Solutions: Michael Garratt and Walter Ripple Healthcare: Cathy Dodd 10:45 BREAK 11:00 Composites: Chris Pederson and Matt
Slide 3: Disclaimer
Disclaimer Forward-Looking Statements In this presentation, statements that are not reported financial results or other historical information are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements give current expectat
Slide 4: Shaping a Sustainable Future
Investor Day 2021 Shaping a Sustainable Future Bob Patterson Avient Corporation 4
Slide 5: End Market Transformation
End Market Transformation 2006 2021E Healthcare Telecom. 4% Telecom. Healthcare Energy 2% Packaging Energy 4% 14% 4% 8% 2% Industrial Industrial 15% Consumer 16% 10% Packaging 19% Transportation 12% Transportation 14% Building & Construction Building & 43% Construction 10% Consumer 23% Avient Corpor
Slide 6: Avient: Who We Are
Avient: Who We Are Headquartered in Avon Lake, OH Key Financial Data (Cleveland) 2021E Sales $4.75 billion 8,600+ employees 100+ manufacturing plants 2021E EBITDA $580 million 2021E EPS $3.00 87% of EBITDA from specialty applications 34 39 22 25,000+ 9 CUSTOMERS >70% of sales • U.S. and Canada • Lat
Slide 7: Specialty Transformation
Specialty Transformation 100% % of Adjusted EBITDA(1) 80% 60% 40% 87% 66% 20% 46% 7% 0% (2) 2005 2010 2015 2021E JVs Performance Products & Solutions Distribution Specialty (1) Adjusted EBITDA is EBITDA excluding corporate costs and special items (2) 2021 includes full synergies from Clariant color
Slide 8: Specialty EBITDA Margin Expansion
Specialty EBITDA Margin Expansion 17.0% 15.2% (1) CAI • Continued portfolio transformation to high-growth end markets and 2.7% sustainable solutions (1) 2006 2019 2021E • Clariant synergy realization 17.6% 15.2% • Investments in composites and outdoor high performance applications drive SEM growth a
Slide 9: We are a Formulator
We are a Formulator CUSTOM FORMULATION Avient Corporation 9
Slide 10: Sustainability for a Better Tomorrow
Sustainability for a Better Tomorrow Revenue From Sustainable Solutions* 2016-2021 ($ in millions) $930M $270 $790M 215 170 $550M $455M 90 $405M 90 $340M 30 45 20 2021E Sales $930M 2016 2017 2018 2019 2020PF** 2021E *Avient Sustainable Solutions definitions aligned with FTC 2012 Guide for the Use of
Slide 11: Adjusted EPS Growth
Adjusted EPS Growth $3.00 $2.43 $2.21 Pro Forma for $2.06 sale of PP&S $1.96 $1.93 $1.80 $1.69 $1.51 $1.31 $1.00 $0.82 $0.68 $0.13 (1) (1) (2) 2009 2010 2011 2012 2013 2014 2015 2016* 2017* 2018 2018 20182 2019 2020 2021E Avient Corporation 11 (1): Pro Forma for sale of DSS (2): Pro Forma for full y
Slide 12: Clariant Color: Transformational Acquisition
Clariant Color: Transformational Acquisition Clariant Color EBITDA Growth ($ in millions) $205 • Acquisition of Clariant Color business significantly expanded presence in healthcare, packaging and consumer end markets $133 2019PF (1) 2021E • Strength of portfolio – double-digit annual EBITDA growth
Slide 13: People
People C ULTU RE IS EVERYTH ING World-Class Safety Diversity & Inclusion 7x Safer than Industry Average Community Service Leadership Development Over $16 million raised since 2010 Avient Corporation 13
Slide 14: Future Growth in Excess of GDP is Driven By
Future Growth in Excess of GDP is Driven By: Our company is positioned to sustainably grow at a rate that exceeds GDP. We will do so through our investments and focus on sustainable solutions for high-growth markets, including healthcare, consumer, packaging and composites. These investments also co
Slide 15: Clariant: Better Together
Clariant: Better Together Norbert Merklein Avient Corporation 15
Slide 16: An Excellent Fit
An Excellent Fit • Geographic footprint – Complementary not overlapping. Truly global • Technology platform and expertise – Combining the best from two global leaders creates an unmatched portfolio of products and solutions • Global and local accounts – Combining our legacies’ business, dealing with
Slide 17: What Legacy Clariant Color Brings
What Legacy Clariant Color Brings • Dedicated global organization • Full suite of performance products • Excellent product stewardship Customer expertise orientation and dedication • High quality technical organization • Strong focus on innovation and sustainability • Strong customer relationships a
Slide 18: Principles of Integration
Principles of Integration Safety First o Both ACC Responsible Care® companies o Legacy and continued focus on safety Retain All Customers and Existing Business o Minimize integration disruptions $85M o Broadened portfolio of specialty solutions Cost Synergies o World class products and service Retai
Slide 19: Clariant Revenue Synergies
Clariant Revenue Synergies The complementary aspects of our combined businesses are unquestionable. From technology portfolios to end markets to geographies and distribution channels, this acquisition made perfect sense. It’s at the heart of why we are better together. • Barrier technology • Clarian
Slide 20: Customer Experience
Customer Experience Avient Corporation 20
Slide 21: ColorWorks
ColorWorks I N S P I R AT I O N . I N N O VAT I O N . C O - C R E AT I O N . • Fostering imagination • Enabling creative exploration • Focus on customers’ sustainability • Driving long-term revenue growth Avient Corporation 21
Slide 22: InstaColr
InstaColr CUSTOMER-FOCUSED CO LOR FORMUL ATIO N • Rapid customer response • Immediate color measurement and quotation • Fast track product development to “now” • Specialized labs for fast sample delivery • Optimized formulations leveraging cost effective raw materials Avient Corporation 22
Slide 23: CycleWorks
CycleWorks ADVANCING THE CIRCULAR ECONOMY • Laboratory mimics real-world circular recycling in a research environment • Conducts chemistry testing to improve plastics recycling for customers • Screening and evaluation of additive and colorant systems during recycling • Collaboration platform for cus
Slide 24: Sustainable Solutions
Sustainable Solutions Michael Garratt and Walter Ripple Avient Corporation 24
Slide 25: Our Sustainability Promise
Our Sustainability Promise As the world’s premier provider of specialized UN Global Compact Commitment polymer materials, services and solutions, Avient is committed to meeting the needs of the present without compromising future generations’ ability to meet their needs. We are committed to creating
Slide 26: Sustainability Report
Sustainability Report Continuous ESG Improvement • Updated 2030 Sustainability Goals • Further disclosure on key Environmental, Social, and Governance impacts • Joined U.N. Global Compact and identified alignment with U.N. Sustainable Development Goals • Emphasized climate change commitment o Announ
Slide 27: 2030 Sustainability Targets
2030 Sustainability Targets Enable 100% of products manufactured for Obtain 60% of electricity demand from packaging applications to be recyclable or renewable sources by 2030, and 100% by 2050. reusable. Deliver cumulative annual revenue Assess top 90% of supplier spend for alignment growth from ou
Slide 28: Avient ESG Ratings
Avient ESG Ratings ISS November 2021 ESG Scores SCORE (1 = Best, 10 = Worst) Environmental 2 Social 1 Governance 4 Sustainalytics 2021 ESG Risk Ranking RANK PERCENTILE (1st = lowest risk) (1st – lowest risk) Chemicals INDUSTRY 75/449 17th Specialty Chemicals SUBINDUSTRY 21/124 17th Avient Corporatio
Slide 29: Products
Products 8 W AY S W E H E L P C U S T O M E R S B E M O R E S U S TAI N AB L E Avient Corporation 29
Slide 30: Enabling Customers' Recycling Goals
Enabling Customers’ Recycling Goals RESOUND™ R RECYCLED-CONTENT TPE 62% recycle content Reduce waste with refillable features High performance and quality Avient Corporation 30
Slide 31: Lightweighting Commercial Trucks
Lightweighting Commercial Trucks P O LY S T R AN D ™ THERMOPLASTIC COMPOSITE LAMINATES 60% Weight reduction in box truck panels Improve fuel economy 100% recyclable Avient Corporation 31
Slide 32: Enabling Customers to Conserve Resources, Reduce Waste
Enabling Customers to Conserve Resources, Reduce Waste RENOL™ SPIN DYE COLORING METHOD 75% less water 30% less energy 25% lower carbon footprint Avient Corporation 32
Slide 33: Sustainability for a Better Tomorrow
Sustainability for a Better Tomorrow Revenue From Sustainable Solutions* 2016-2021 ($ in millions) $930M $270 $790M 215 170 $550M $455M 90 $405M 90 $340M 30 45 20 2021E Sales $930M 2016 2017 2018 2019 2020PF** 2021E Avient Corporation 33 *Avient Sustainable Solutions definitions aligned with FTC 201
Slide 34: The Challenge and the Opportunity
The Challenge and the Opportunity Avient Corporation 34
Slide 35: Plastic is Part of the Solution
Plastic is Part of the Solution PLASTIC ALTERNATIVE PACKAGING (GLASS & ALUMINUM) Requires… 6x more Water 5x more Weight 2x more Energy 2x more Greenhouse gas emissions Avient Corporation 35 Source: Franklin Associates, A Division of Eastern Research Group (ERG)
Slide 36: Brand Owners Goals: Substantially Increase use of Recycled Materials
Brand Owners Goals: Substantially Increase use of Recycled Materials Percent recycled plastic used: Current (1) Additional share needed to reach 2025 target (examples and not exhaustive) Brand Owner 1 9 41 Brand Owner 2 7 18 Brand Owner 3 7 13 Brand Owner 4 7 19 Brand Owner 5 5 9 Brand Owner 6 3 35
Slide 37: Sustainable Solutions Live Here
Sustainable Solutions Live Here. At Avient, we create specialized and sustainable material solutions that transform customer challenges into opportunities, bringing new products to life for a better world. SAVIENT Avient Corporation 37
Slide 38: Improving the Use of Recycled Content
Improving the Use of Recycled Content T O P 5 G AP S T H AT W E AR E A D D R E S S I N G 1: COLOR MANAGEMENT 3: MAINTAINING MECHANICAL 2: DECONTAMINATION PROPERTIES 4: MONO-MATERIAL 5: CONSISTENT RECYCLED CONSTRUCTION MATERIAL QUALITY Avient Corporation 38
Slide 39: 1: Color Management
1: Color Management RECYCLE COLOR QUALITY RANGE CHALLENGES • Inconsistent base color of recycled materials Our Solutions • Lightest color recycled material in high demand for all applications ($$) • OpticaTM Toners and Super-concentrated colorants to • Even with clear/transparent materials, color de
Slide 40: Recycled Material Restricts Color Options
Recycled Material Restricts Color Options With virgin material, we The darker the recycled can design across a broad materials, the more color color spectrum design freedom is restricted This bright yellow is not achievable with high concentrations of dark recycled materials Avient can provide custo
Slide 41: Case Study with Brand Owner
Case Study with Brand Owner Virgin Resin Recycled Resin = = Clean Color Base Discolored Base Degree of base discoloration limits recycle content Avient Corporation 41
Slide 42: The Plus Factor Opportunity
The Plus Factor Opportunity I N C R E AS E D U S E O F R E C Y C L E D M AT E R I AL REQUIRES MORE COLORANT AND ADDITIVES $100M + Avient Corporation 42
Slide 43: 2: Decontamination
2: Decontamination CHALLENGES Recycled material feedstocks are contaminated • Feedstock variability supplies the recycle process • Insufficient washing at recycler • Residual labels and printing inks cause quality and NIAS issues Our Solutions • Unpleasant recycled material odor (in processing and t
Slide 44: 3: Maintaining Mechanical Properties
3: Maintaining Mechanical Properties CHALLENGES • Mechanical properties of recycled materials degrade after multiple heat cycles • Today's recycling protocols only focus on one recycle loop…in reality, there will be several • Legislation and brand owners are targeting higher recycled material ratio
Slide 45: 4: Mono-Material Construction
4: Mono-Material Construction CHALLENGES Multi-material packaging is harder to recycle Our Solutions • Contamination of polymer streams • Portfolio of compatibilizers to enable multilayer constructions • Issues in sorting • AmosorbTM to extend beverage shelf life by scavenging • Issues in separation
Slide 46: 5: Consistent Recycle Material Quality
5: Consistent Recycle Material Quality CHALLENGES Brand Owners require a consistent brand identity • Inconsistent quality streams pose a challenge to delivering homogeneous product quality and aesthetics to the consumer Our Solutions • Brands demand recycled content, but with color/property consiste
Slide 47: Growth in Sustainable Solutions
Growth in Sustainable Solutions Revenue From Sustainable Solutions* Future Revenue Growth Assumptions $930M 8-12% $340M CAGR 2016 2021E *Avient Sustainable Solutions definitions aligned with FTC 2012 Guide for the Use of Environmental Marketing Claims (“Green Guides”) Avient Corporation 47
Slide 48: Healthcare
Healthcare Cathy Dodd Avient Corporation 48
Slide 49: High-Impact, High-Growth Industry
High-Impact, High-Growth Industry Healthcare Submarkets (2021E) Track Record of Sales Growth ($ millions) Personal Wellness Remote 3% Monitoring 5% Medical Equipment / $685 Packaging Devices 8% 33% Labware $380 14% $225 Medical Drug Supplies Delivery 18% 19% 2010 2016 2021E Avient Corporation 49
Slide 50: Our Foundation
Our Foundation WE ARE POSITIONED TO WIN Relationships Innovative Solutions Differentiated Services Avient Corporation 50
Slide 51: Trends in Healthcare
Trends in Healthcare S H AP I N G I N N O VAT I O N & S O L U T I O N S Improved Wellness & Globalization & Increasing Life Expectancy Connectedness Localization Self Management & Self Technology Driving COVID-19 Protection Diagnostic & Remote Administration Monitoring Avient Corporation 51
Slide 52: COVID-19 Protection
COVID - 19 Protection AV I E N T WA S S E T A N D R E A D Y • Deep, trusted customer relationships • Well-positioned and entrenched in the Healthcare supply chain • Broad & differentiated capabilities • Positioned to respond & execute quickly Avient Corporation 52
Slide 53: Aging Population
Aging Population T R E AT I N G C H R O N I C C O N D I T I O N S Of the U.S. population is aged 65 or older… and this number is growing Suffer from one or more chronic health conditions Avient Corporation 53
Slide 54: Aging Population
Aging Population T R E AT I N G C H R O N I C C O N D I T I O N S Cardiology • 47% of Americans having at least one of three major risk factors for heart disease Diabetes • 193 million people with Type 2 diabetes and will grow to 252 million by 2026 at a 5% CAGR Neurology • Neurological disorders ar
Slide 55: Connected Health
Connected Health EXPANSION OF MEDICAL WEAR ABLE DEVICES Application Opportunities • Flexible components to provide design aesthetics & proper functionality • Robust designs to meet regulatory requirements and perform over long product lifecycles • Patient comfort to promote ongoing use Improved Well
Slide 56: Remote Patient Monitoring
Remote Patient Monitoring TR AN S L AT I N G D E V I C E S F R O M H O S P I TAL S E TTI N G S TO H O M E Application Opportunities • Durable, chemically-resistant devices to withstand impact in a home environment and exposure to a variety of household cleaners • Miniaturization of devices to fit in
Slide 57: Self Management & Self Administration
Self Management & Self Administration E N AB L I N G PAT I E N T S T O M AN A G E H E A LT H Application Opportunities • Combination of rigid & flexible materials to realize design potential and optimize device functionality • Superior chemical resistance to cleaners, disinfectants, hand oils, UV ra
Slide 58: Trends are Shaping Innovation
Trends are Shaping Innovation Professional / Clinic Patient / Home Avient Corporation 58
Slide 59: Avient Design
Avient Design D I F F E R E N T I AT E D S E R V I C E • Global product development support from industrial design through engineering and product launch • Extensive material, manufacturing, industry and value chain knowledge • Human-centric design skill, aligning product innovations with ergonomic
Slide 60: Accelerating Speed to Market with Avient design
Accelerating Speed to Market with Avient design PROOF OF LAUNCH & IDEA DESIGN TOOLING EVALUATION CONCEPT DELIVERY Avient Corporation 60
Slide 61: Avient Design: Auto Injector
Avient Design AUTO INJECTOR Avient Corporation 61
Slide 62: Avient Design: Auto-Injector Tear-Down
Avient Design AUTO-INJECTOR TEAR-DOWN Defined haptics Stringent regulatory and soft touch requirements Strict change control Drug contact, mechanical sensitivity for dosing accuracy Lasermarking and laserwelding compatible Avient Corporation 62
Slide 63: Avient Design: Auto Injector Innovation
Avient Design A U T O I N J E C T O R I N N O VAT I O N Avient Corporation 63
Slide 64: Avient Design: Auto Injector Innovation
Avient Design A U T O I N J E C T O R I N N O VAT I O N Easy to use Safe Quality Protect Ingredients Compliant Temperature Management Avient Corporation 64
Slide 65: Avient Design: Auto Injector Innovation
Avient Design A U T O I N J E C T O R I N N O VAT I O N Easy to use Medical Grade TPE Safe Healthcare Colorants Quality High-Density Polymer Protect Ingredients Laser weldable formulation Compliant Laser marking additives Temperature Lubricated polymers Management Avient Corporation 65
Slide 66: Healthcare Growth Outlook
Healthcare Growth Outlook Market for Medical Plastics Future Revenue Growth Assumptions (LBs millions) 29,445 17,645 8-10% CAGR 2021E 2025E Source: BCC Research, Nov. 2020 Avient Corporation 66
Slide 67: Break
Investor Day 2021 S«AVIENT
Slide 68: Composites
Composites Chris Pederson Avient Corporation 68
Slide 69: Spotlight: Growth in Composites
Spotlight: Growth in Composites Composites ($ in millions) 70 • Prior investments in composites $260 60 platform and outdoor high $216 $212 performance applications continue 50 $50 to pay off driving substantial growth 40 in 2021 $41 $32 30 $74 $84 20 • Composites will also drive our ability to deli
Slide 70: Composite Material Design
Composite Material Design Materials Structure Lower weight Corrosion resistance Fatigue performance Tailor-ability Design flexibility Part Properties Mfg Process Avient Corporation 70
Slide 71: Composite Material Forms
Composite Material Forms Performance Performance Continuous Fiber Continuous Fiber Thermosets Thermosets Continuous Fiber Continuous Fiber Thermoplastics Thermoplastics Discontinuous Fiber Discontinuous Fiber Thermoplastics Thermoplastics Design Flexibility Manufacturing Costs Avient Corporation 71
Slide 72: Composites Portfolio
Composites Portfolio D I V E R S E C A PA B I L I T I E S A N D S O L U T I O N S S E R V I N G M A N U FA C T U R E R S A N D O E M S LFT Tapes Laminates/Panels Shapes Pultrusion Engineered Fibers Avient Corporation 72
Slide 73: Powersports & Outdoor Gear
Powersports & Outdoor Gear BENEFITS OF COMPOSITES STRUCTURAL COMPONENTS BODY PANELS ADVENTURE GEAR Material Replacement • Weight Reduction • Paint Replacement • Weight Fatigue Resistance • Lightweight • Temperature Resistance • Impact Resistance Reduction • Scratch Resistance Temperature Resistance
Slide 74: Industrial & Energy
Industrial & Energy BENEFITS OF COMPOSITES HIGH PRESSURE PIPE GPS TRACKABLE PALLETS POWER INFRASTUCTURE Burst Strength • Corrosion Resistance • Weight Reduction • Increased Load • Corrosion Resistance • Electrical Lighter Weight Stiffness Insulation • Weight Reduction Avient Corporation 74
Slide 75: Spotlight: Growth at Fiber-Line
Spotlight: Growth at Fiber-Line Revenue ($ millions) • Fiber-Line business acquired on $119 January 2, 2019 for $120 million • Specialty portfolio of fiber-optic cable applications primarily serving $66 telecommunications end-market $48 $31 • Deep formulation expertise, innovative culture and global
Slide 76: 5G Technology
5G Technology Matt Reinhardt Avient Corporation 76
Slide 77: Evolution of 5G
Evolution of 5G M E E TIN G S I GN IF IC AN TLY E X PAN D IN G C ON N E C TIV I TY N E E D S Avient Corporation 77
Slide 78: How Fast is 5G?
How FAST IS 5G? Time needed to download a 2 hour movie Avient Corporation 78
Slide 79: Low Latency
Low Latency R E D U C I N G T H E T I M E F O R D ATA T O T R AV E L 4G 5G 300 3 milliseconds milliseconds Avient Corporation 79
Slide 80: Infrastructure
Infrastructure 5G REQUIRES MORE EQUIPMENT Global 5G infrastructure demand will grow 50% CAGR through 2028 4G 5G Base station antennae More and larger base station antennae Radio Additional radio heads heads on base station antennae Fiber optic cable Millions of small cell antennae 16x more fiber opt
Slide 81: Infrastructure
Infrastructure 5G ANTENNAE DENSITY 3G to 4G = 4G to 5G = 25x more antennae 16x more antennae Avient Corporation 81 Source: Fiber Broadband Association
Slide 82: Infrastructure
Infrastructure 5G REQUIRES MORE CABLE • Overall broadband expansion will require 28 million km of fiber optic cable over next 5 years • U.S. Infrastructure Bill earmarks $65 billion for broadband buildout • US RDOF (Rural Digital Opportunity Fund) to support continued investment in fiber-to-the-home
Slide 83: 5G Rollout: Waves
5G Rollout: 3 Waves 5G Capacity and Demand1 7B 6B Dense Urban Capacity (GB/mo.) Telecom operators will invest up to 5B $1.5 Trillion 4B 3B to roll out 5G globally 2B 1B 0B 2019 2020 2021 2022 2023 2024 2025 2026 2027 Capacity below 6GHz 5G mm-wave capacity Demand (GB/mo) Rollout Stages 2018 - 2022 2
Slide 84: Avient in 5G Ecosystem
Avient in 5G Ecosystem Smart Antenna Home Phase Shifters Autonomous Cars INFRASTRUCTURE IOT DEVICES Ripcord Virtual Yarns Healthcare Reality Wearables Complete Cable Water Construction Blocking Yarns Strength Cable Jacket Members Cable Insulation Smart Phones Avient Corporation 84
Slide 85: Composites Growth Outlook
Composites Growth Outlook Megatrend Growth Rate Future Revenue Growth Assumptions 5G Capacity and Demand 7B 6B Dense Urban Capacity (GB/mo.) 10% CAGR 5B 4B 3B 2B 1B 0B 2019 2020 2021 2022 2023 2024 2025 2026 2027 Capacity below 6GHz 5G mm-wave capacity Demand (GB/mo) Source: Mobile Experts: 5G Milli
Slide 86: Growth in Asia, Latin America
Growth in Asia, Latin America Woon Keat Moh Avient Corporation 86
Slide 87: Regional View
Regional View AVIENT GEOGRAPHY REVENUE REGIONAL ECONOMIC GROWTH GDP, Percent Change Latin America 7% 9% U.S. & Canada 50% 6% Asia 16% 5% 4% 3% 2% 1% EMEA 25% 0% 2022 2023 2024 2025 U.S. Latin America and the Caribbean Emerging and developing Europe Emerging and developing Asia Avient Corporation 87
Slide 88: Asia
Asia China India Southeast Asia Avient Corporation 88
Slide 89: China Landscape
China Landscape GDP growth forecast of 6% (2022 – 2025) 14th 5-year plan (2021 – 2025) Infrastructure – 5G networks Sustainability – renewable energy, electric vehicles “Dual Circulation” strategy will drive domestic consumption Avient Corporation 89
Slide 90: Southeast Asia Landscape
Southeast Asia Landscape GDP growth forecast of 6% (2022 – 2025) “China plus One” strategy driving investment in manufacturing sites Growing middle class population driving the consumption and need for better quality healthcare. Avient Corporation 90
Slide 91: China and Southeast Asia
China and Southeast Asia TR ACK RE C OR D O F G R OW TH & E X PAN S IO N 2X 18 plants > 2.5X 500 commercial > 3X resources $680M revenue Chuzhou, China Regional headquarters and innovation center established in 2015 Built largest manufacturing site within Avient in 18 months and commissioned in 2021
Slide 92: India Landscape
India Landscape Most populous country in the world by 2030 One of the youngest population in the world feeding the talent pool Growing middle class driving the need for better quality goods and services “Made In India” and “Digital India” initiative driving foreign and domestic investments Avient Co
Slide 93: India
India MOMENTUM TO EXPAND > 10X 4X 100 commercial 4 plants resources > 20X Vashere Pune Vashere Pune $70M revenue Establishing an Innovation Center to support local technology needs and global R&D efforts Investment in resources, capacity, and capability to support growth and geographic expansion to
Slide 94: Latin America
Latin America Avient Corporation 94
Slide 95: Latin America Landscape
Latin America Landscape Region’s economy expected to double by 2030 Top 6 countries contribute 75% of the region’s GDP Mexico remains a manufacturing hub for North America Growing middle class population Avient Corporation 95
Slide 96: Latin America
Latin America LEVERAGE AND EXPAND 2X > 5X Santa Clara, Mexico Toluca, Mexico Suzano, Brazil 9 plants 200 commercial resources > 20X Cota, Colombia Guatemala, Guatemala Itupeva, Brazil $400M revenue Investment in capacity, and capability to support domestic growth Maipu, Chile Lima, Peru Lomas, Argen
Slide 97: Asia and Latin America Growth Outlook
Asia and Latin America Growth Outlook Future Revenue Growth 12% Organic Sales Growth Assumptions Asia (ex. India) India LATAM $680 $400 8-10% $70 CAGR $191 (5% CAGR excluding $3 $16 Sustainable Solutions) 2010 2021E 2010 2021E 2010 2021E (Sales in $ millions) Figures above include sustainable soluti
Slide 98: Innovation at Avient: Where are we going next?
Innovation at Avient: Where are we going next? Vinod Purayath Avient Corporation 98
Slide 99: We have talked about
We have talked about: …Sustainable Solutions …Healthcare …Composites / 5G …Growth in Asia and Latin America Avient Corporation 99
Slide 100: Growth Through Innovation
Growth Through Innovation NEW PRODUCT DEVELOPMENTS & PHASED OFFER LAUNCHES Frame Build Business Scale-up & Commercial Prototype Total Opportunity Case Test Market Launch Sustainable Solutions 32 7 105 6 41 191 Other 13 1 17 1 13 45 Total Projects 45 8 122 7 54 236 80% of innovation projects for Sust
Slide 101: Paradigm Shift
Paradigm Shift Almost every great advancement in technology can be attributed to a breakthrough in material science. Avient Corporation 101
Slide 102: Electronics THEN…
Electronics THEN… Avient Corporation 102
Slide 103: Electronics NOW…
Electronics NOW… Avient Corporation 103
Slide 104: Meta Materials
Meta Materials A rationally designed composite material aiming at effective material parameters that go beyond those of the ingredient materials. Avient Corporation 104
Slide 105: Unprecedented Market Opportunity
Unprecedented Market Opportunity $3 Billion Market • 5G Infrastructure • Vehicle Electrification • IoT, Wearables • Home Health & Consumer Medical Devices Source: Lux Research Inc., How can Avient “capture & create” value in this segment? Engineered Materials: Revolutionary Adaptation Avient Corpora
Slide 106: Potential Disruptive Markets
Potential Disruptive Markets Artificial Semiconductors Robotics Healthcare Intelligence Interconnected disruptive markets with massive innovation needs How do we find / create potential opportunities in these markets? Avient Corporation 106
Slide 107: Potential Opportunities
Potential Opportunities ROBOTICS HEALTHCARE Barrier Technologies Functionalized Bio- Sustainability Additive Manufacturing compatible resins / Functionalized Bio- additives compatible resins / Adv. Fiber Technology Chemical / UV Barrier Technologies additives resistance Bio-pharma Adv. Ela
Slide 108: India Innovation Center
India Innovation Center Innovative Sustainable Holistic Accelerator (ISHA) We are breaking ground on a new innovation center adjacent to our manufacturing facility in Pune ISHA Avient Manufacturing Site, Pune, India • Focused on investments in both R&D resource additions and capital investments • Pl
Slide 109: Growth Through Innovation
Growth Through Innovation World-Class Vitality Index Total CAI and SEM % of revenue from products launched last five years Revenue from new products 35% $1.6B $1.1B 12% 2006 2021E 2021E 2022E 2023E 2024E 2025E Avient Corporation 109
Slide 110: Summary
Investor Day 2021 Summary Jamie Beggs Avient Corporation 110
Slide 111: Full Year 2019 – 2021 Organic Growth
Full Year 2019 – 2021 Organic Growth ( T O TA L C O M PA N Y ) Sales Adjusted EBITDA Adjusted EPS + 19% + 31% + 72% $4,750 $580 $3.00 $3,981 $457 $3,783 $442 $1.93 $1.74 (1) (1) (1) (1) (1) (1) 2019PF 2020PF 2021E 2019PF 2020PF 2021E 2019PF 2020PF 2021E (in millions) (in millions) Avient Corporation
Slide 112: 2021 Sales Growth Summary
2021 Sales Growth Summary Key Growth Drivers Segments Growth Growth Sales Sales Rate Rate (1) (1) 2020 Proforma $ 3,783 2020 Proforma $ 3,783 Sustainable Solutions 140 18% Color, Additives & Inks 330 16% Healthcare 150 31% Specialty Engineered Materials 195 28% Composites 44 33% Distribution 495 45%
Slide 113: Year–to–date EBITDA Bridge
Year–to–date EBITDA Bridge Adjusted ($ millions) EBITDA (1) 2020 September YTD $ 339 Demand 132 CAI: • Demand driven by growth in Price / Mix 96 sustainable solutions, healthcare Inflation (74) and consumer applications SEM: Price / Mix 61 Inflation (45) • Price increases have more than covered
Slide 114: Return on Invested Capital
Return on Invested Capital Cost of Capital ROIC (after-tax) Invested Capital ($ millions) $3,000 12% 11% 8% $1,110 5% 2006 Current 2006 2021E 2006 2021E Avient Corporation 114
Slide 115: Creating Value for Shareholders
Creating Value for Shareholders Share Performance Dividends Share Repurchases Deleveraging ~$4.3Bn ~$450MM ~$1Bn 2.1x MARKET CAP INCREASE PAID OVER LAST 11 YEARS REPURCHASED Q4 NET LEVERAGE OVER LAST 10 YEARS OVER LAST 10 YEARS 0.95 528% 0.85 0.79 0.81 1.0 1.0 0.9 0.72 0.9 3.5x 0.8 0.58 0.7 0.50 98%
Slide 116: Shaping a Sustainable Future…
Shaping a Sustainable Future… Avient Corporation 116
Slide 117: What We Shared Today: Sustainable Solutions
What We Shared Today S US TAINAB LE S OLU TI ONS Brand Owner Commitment Avient Historic Growth Future Growth Assumptions Percent of recycled 13% organic CAGR plastic used $930 10 – 50 8-12% $340 CAGR 3 2021E 2025E 2016 2021E Net Sales ($ millions) Avient Corporation 117
Slide 118: What We Shared Today: Healthcare
What We Shared Today HE A LT HCARE Megatrend Growth Rate Avient Historic Growth Future Growth Assumptions 11% CAGR 9% organic CAGR $685 29,445 17,645 8-10% $225 CAGR 2021E 2025E 2010 2021E Market for Medical Plastics (millions of LBs) Net Sales ($ millions) Source: BCC Research, Nov. 2020 Avient Cor
Slide 119: What We Shared Today: Composites
What We Shared Today C OMP OSI TE S Megatrend Growth Rate Avient Historic Growth Future Growth Assumptions 5G Capacity and Demand 11% organic CAGR 7B $260 6B Dense Urban Capacity (GB/mo.) 5B 4B 3B 10% CAGR 2B $74 1B 0B 2019 2020 2021 2022 2023 2024 2025 2026 2027 2017 2021E Capacity below 6GHz 5G mm
Slide 120: What We Shared Today: Asia and Latin America
What We Shared Today A SI A AN D L AT I N A ME RI CA Weighted Avg. GDP Growth Avient Historic Growth Future Growth Assumptions 12% organic CAGR Global Avient: 2.7% $1,150 8-10% CAGR Asia / LATAM: 5.0% $210 (5% CAGR excluding Sustainable Solutions) 2010 2021E Source: International Monetary Fund, Worl
Slide 121: Summary: Long-term Revenue Growth Drivers
Summary: Long-term Revenue Growth Drivers 2021 Sales Annual Growth Drivers 2021 Sales Estimate Overlap Growth ($ millions) Estimate (Drivers) Rate Sustainable Solutions 930 - 930 8–12% Healthcare 685 (45) 640 8–10% Composites 260 (80) 180 10% Asia / LATAM 1,150 (310) 840 5% Other (GDP growth) 2,160
Slide 122: EBITDA Margin Expansion Goals
EBITDA Margin Expansion Goals 1.0% 0.4% 20%+ 1.6% 17.0% CAI • Continued portfolio transformation to high- growth end markets and sustainable solutions 2021E Synergies Sustainable Healthcare Goal Solutions • Clariant Color synergy realization 1.1% 0.4% 20%+ • Investments in composites and outdoor hig
Slide 123: Sustainable Path to Double Digit Earnings Growth
Sustainable Path to Double Digit Earnings Growth Long-Term Sales Growth Drivers Growth Rate Sustainable Solutions 8–12% 10%+ Healthcare 8–10% Adjusted EBITDA growth 15%+ Composites 10% Asia / LATAM 5% Other (GDP growth) 2–3% Adjusted EPS growth Avient 6.5% Avient Corporation 123
Slide 124: An Investment in Sustainable Growth
Investor Day 2021 An Investment in Sustainable Growth Bob Patterson Avient Corporation 124
Slide 125: M&A Brings Avient New Technologies
M&A Brings Avient New Technologies Technology Acquisition Technology Acquisition Thermoplastic Silicone Colorants & Elastomers Formulations Liquid Color Concentrates Long Fiber Reinforced (LFT) & Additives Thermoplastic Composites Continuous Fiber Composites Fiber Solutions Fiber & Healthcare Expert
Slide 126: Clariant Color: Transformational Acquisition
Clariant Color: Transformational Acquisition Clariant Color EBITDA Growth ($ in millions) $205 • Acquisition of Clariant Color business significantly expanded presence in healthcare, packaging and consumer end markets $133 2019PF (1) 2021E • Strength of portfolio – double-digit annual EBITDA growth
Slide 127: Bolt-On Acquisition History
Bolt-On Acquisition History Established Acquisitions (> 7 years) Commercial Operating Income Operating Margins Resources(1) ($ in millions) $122 21% 360 + 39% + 205% + 1200 bps 259 $40 9% At Acquisition 2021E At Acquisition 2021E At Acquisition 2021E (1) Commercial Resources include associate headco
Slide 128: We are a specialty formulator AND a sustainable solutions company
We are a specialty formulator AND We are a sustainable solutions company Avient Corporation 128
Slide 129: Avient is Asset Light
Avient is Asset Light Capex / Revenue As a specialty formulator, we don’t 2021E (%) 9 require significant capital investment, as compared to the base resin raw material suppliers 7 we purchase from. Even more, our 6 manufacturing capabilities are 5 5 flexible and easily adaptable to 4 4 changing cus
Slide 130: Avient is High Touch
Avient is High Touch Our world-class vitality index of Commercial Resources 35% represents sales from products introduced in the last five years. This performance is not by chance. Rather, it’s reflective of consistent, 872 strategic investments in our portfolio…and people. Commercial Excellence is
Slide 131: High Free Cash Flow Conversion
High Free Cash Flow Conversion 2021E (%) 93 86 89 85 85 82 82 81 79 79 78 77 74 77 74 72 25 RPM HXL ECL SCL BNR PPG KWR AVY FUL EMN ASH UNVR CE GCP Avient FMC HUN Avient Specialty Other Specialty / Formulators Chemical Companies Source: Peer data per Bloomberg market data as of December 2, 2021 Avie
Slide 132: EBITDA Margins
EBITDA Margins 2021 Expansion Goals 34% 26% 25% 22% 21% 20%+ 16% 16% 16% 16% 16% 15%+ 14% 14% 14% 15% 12% 12% 9% 8% ex. Distribution RPM BNR PPG AVNT KWR AVY ex. Distribution FUL EMN ECL HXL SCL ASH UNVR CE AVNT AVNT GCP FMC HUN AVNT Avient Specialty Other Specialty / Formulators Chemical Companies
Slide 133: Multiple Expansion
Multiple Expansion With the Clariant Color business Total Enterprise Value / 2021E EBITDA acquisition and divestment of the PP&S business, our exposure is now 25.7 25.5 concentrated in less-cyclical and Historic Multiple high-growth markets. 17.7 16.7 Over the last 10 years, our multiple 15.5 15.3 1
Slide 134: Key Takeaways
Key Takeaways • Culture is everything – we are a high performing company and great place to work • We are a specialty formulator of sustainable solutions • We are well positioned to consistently deliver double digit growth from key mega trends and to increase ROIC • We have and will continue to gene
Slide 135: Thank You.
Investor Day 2021 Thank You.
Slide 136: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures (Unaudited) (Dollars in millions, except for per share data) Year Ended Reconciliation of EBITDA by Segment December 31, 2019 Sales: Color, Additives and Inks $ 1,003.8 Specialty Engineered Materials 745.7 Distribution 1,192.2 Corporate and eliminations
Slide 137: Reconciliation of Pro Forma EBITDA - Color, Additives and Inks
Year Ended Reconciliation of Pro Forma EBITDA - Color, Additives and Inks December 31, 2019 Sales: Color, Additives and Inks $ 1,003.8 (1) Clariant Color pro forma adjustments 1,118.6 Pro forma sales $ 2,122.4 Operating income: Color, Additives and Inks $ 147.4 (1) Clariant Color pro forma adjustmen
Slide 138: Reconciliation to Pro Forma Adjusted EBITDA
Nine Months Ended Year Ended September 30, December 31, Reconciliation to Pro Forma Adjusted EBITDA 2020 2021 2020 2019 Net income from continuing operations – GAAP $ 59.1 $ 201.7 $ 133.8 $ 75.7 Income tax expense 22.5 51.8 5.2 33.7 Interest expense 55.3 57.8 74.6 59.5 Depreciation and amortization
Slide 139: Reconciliation of Pro Forma Adjusted Earnings per Share
Year Ended December 31, 2019 Clariant MB Pro Forma Reconciliation of Pro Forma Adjusted Special Adjusted Pro Forma Adjusted Earnings per Share Avient Items Avient Adjustments(1) Avient Sales $ 2,862.7 $ — $ 2,862.7 $ 1,118.6 $ 3,981.3 Operating income $ 156.8 $ 71.7 $ 228.5 $ 72.9 $ 301.4 Interest e