Slide 1: 1Q 2023 Earnings Presentation
May 5, 2023 1Q 2023 Earnings Presentation
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: Overview
Overview Continue to Benefit From Our Diverse Portfolio and Integrated, Efficient and Cost-Advantaged Business Model 1Q23 Adjusted EBITDA ✓ Delivered solid earnings results against record prior year comparison – Sales of $401M and Net Income of $35M $65M – Nitrogen fertilizer pricing declined in the
Slide 4: 1Q 2023 Financial Summary
1Q 2023 Financial Summary Volume and Pricing Headwinds Partially Offset by Lower Raw Material Costs ($M, except per share amounts) Sales Adjusted EBITDA Adjusted Diluted EPS Free Cash Flow (16%) (37%) (42%) ($51M) $28 $103 $2.26 $479 $401 $65 $1.30 ($23) 1Q22 1Q23 1Q22 1Q23 1Q22 1Q23 1Q22 1Q23 Adjus
Slide 5: 1Q 2023 Adjusted EBITDA Bridge
1Q 2023 Adjusted EBITDA Bridge Solid Results in Current Environment and Against Record Prior Year Comparison ($M) ($5) • Caprolactam / Nylon ($15) • Ammonium Sulfate • Cautious buying behavior ($13) for fertilizer amid ($5) • Chemical Intermediates continued pricing declines • Higher plant spend rel
Slide 6: Cash Flow Summary
Cash Flow Summary Unfavorable Impact of Changes in Working Capital…Fundamentals and Disciplined Deployment Intact Trailing 12-Month FCF Yield ~12% Trailing 12-Month FCF Conversion ~92% • 1Q23 free cash flow unfavorably impacted by changes in working capital driven largely by the timing of raw materi
Slide 7: Industry Pricing and Spreads
Industry Pricing and Spreads Nylon Ammonium Sulfate Chemical Intermediates Global Pricing Pressured by Unfavorable Lower Energy Costs, Ag Fundamentals Remain Strong Balanced North America Acetone Supply and Demand Supply/Demand ($/ston N content (cents per ($/MT) 80 4000 basis) 2000 pound) 1600 3600
Slide 8: Commitment to Sustainability
Commitment to Sustainability Strong Linkage to Corporate Strategic Priorities and Performance Environmental Social Governance • 67% reduction in Criteria Pollutants since 2015 • Diverse representation increased 25% since 2020 • NJ NACD 2023 Public Company of the Year for to 40% Governance Results •
Slide 9: 2023 Outlook
2023 Outlook Executing on Strategic Priorities to Continue Driving Shareholder Value • Expect strong underlying agriculture and fertilizer industry fundamentals to continue through the domestic planting season; Anticipate improvement in 2Q23 ammonium sulfate Sales by End Market domestic sales volume
Slide 10: Well Positioned To Deliver Attractive Returns Over Long-Term as a Diversified Chemistry Company
Well Positioned To Deliver Attractive Returns Over Long-Term as a Diversified Chemistry Company • Three product lines to support near and long-term performance Leading Product Portfolio Aligned to Diverse and • Customer focus on reliable, local supply; Supportive of onshoring of manufacturing/supply
Slide 11: Appendix
AovaNSix APPENDIX Good chemistry,
Slide 12: Planned Plant Turnarounds
Planned Plant Turnarounds Pre-Tax Income Impact by Quarter (1) 1Q 2Q 3Q 4Q FY 2017 -- ~$10M ~$4M ~$20M ~$34M • Timing driven by compliance, inspection and sustaining 2018 ~$2M ~$10M ~$30M -- ~$42M asset base 2019 -- ~$5M ~$5M ~$25M ~$35M • Critical to supporting high utilization rates 2020 ~$2M ~$7M
Slide 13: Reconciliation of Non-GAAP Measures to GAAP Measures
Reconciliation of Non-GAAP Measures to GAAP Measures
Slide 14: Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow
Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow and Free Cash Flow Conversion (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 (2) Free cash flow conversion
Slide 15: Reconciliation of Net Income to Adjusted EBITDA
Reconciliation of Net Income to Adjusted EBITDA (in $ thousands) (1) Adjusted EBITDA margin is defined as Adjusted EBITDA divided by Sales The Company believes the non-GAAP financial measures included in this presentation provide meaningful supplemental information as they are used by the Company’s
Slide 16: Reconciliation of Earnings Per Share to Adjusted Earnings Per Share
Reconciliation of Earnings Per Share to Adjusted Earnings Per Share (in $ thousands except share and per share amounts) The Company believes the non-GAAP financial measures included in this presentation provide meaningful supplemental information as they are used by the Company’s management to evalu