Element Solutions Inc. · NYSE:ESI
Element Solutions — CJS Securities New Ideas for the New Year Investor Conference 2017
25 slides from Element Solutions's conference presentation, Jan 11, 2017
Slide 1: CJS New Ideas for the New Year Investor Conference
CJS New Ideas for the New Year Investor Conference January 11, 2017
Slide 2: Safe Harbor
Safe Harbor Please note that in this presentation, we may discuss events or results that have not yet occurred or been realized, commonly referred to as forward- looking statements. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by or
Slide 3: Non-GAAP Disclosure
Non-GAAP Disclosure To supplement the financial measures prepared in accordance with generally accepted accounting principles in the United States (“GAAP”), the Company uses the following non-GAAP financial measures: adjusted EBITDA, adjusted EBITDA guidance, comparable net sales, comparable adjuste
Slide 4: Agenda
Agenda Platform Overview Recent Updates Platform Objectives Q&A Appendices 4
Slide 5: Platform Overview
PLATFORM SPECIALTY PRODUCTS CORPORATION ml Platform Overview
Slide 6: Platform Business Segments
Platform Business Segments $1.8bn 2015 Comparable Net Sales $407m 2015 Comparable Adj. EBITDA 1 INDUSTRIAL SOLUTIONS ELECTRONIC SOLUTIONS GRAPHIC SOLUTIONS OFFSHORE SOLUTIONS Corrosion resistance Circuit board metallization Solder paste Flexographic Temperature and PRODUCTS Decorative fi
Slide 7: Platform Comparable Financial Overview (Non-GAAP)
Platform Comparable Financial Overview (Non-GAAP) 2015 Net Sales: $3.6bn Adj. EBITDA: $742m Employees: ~8,500 $741 m $955 m $948 m Performance Agricultural Solutions Solutions Net Sales: $1.8 bn Net Sales: $1.8bn Adj. EBITDA: Adj. EBITDA: $289 m $407m1 $382m 1 $687 m Employees: ~4,500 Employees: ~4,
Slide 8: Platform is Building a Global, Diversified Specialty Chemicals Company
Platform is Building a Global, Diversified Specialty Chemicals Company “Asset-Lite, High-Touch” Business Model that Drives Free Cash Flow − Businesses driven by people, partnerships and supply chain as opposed to heavy manufacturing − Low capex requirements and highly variable cost structure − Sig
Slide 9: Recent Updates
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Slide 10: Recent Updates
Recent Updates 1. Balance Sheet Update 2. Cost Synergy Update 3. 2016 Guidance Review 10
Slide 11: Balance Sheet Update
Balance Sheet Update Term Loan Repricings − Platform repriced all of its term loans in Q4 2016 and extended nearly $2bn in principal to 20231 − In addition, the Company shifted ~ $600m of its term loan currency mix towards the Euro to better match its earnings profile and improve its all-in cost o
Slide 12: Cost Synergy Update
Cost Synergy Update 3Q 2016 AGRICULTURAL SOLUTIONS 3Q 2016 PERFORMANCE SOLUTIONS $ in millions $ in millions Realized YoY Cost Synergies Realized YoY Cost Synergies $25 $25 $19 $20 $20 $20 $20 $5 $20 $8 $14 $15 $15 $11 $10 $10 $5 $5 $0 $0 1H Q3 Q3 YTD 2016 Target 1H Q3 Q3 YTD 2016 Target $13 million
Slide 13: 2016 Guidance Review
2016 Guidance Review 1st Announced on Q3’16 Earnings Call 2016 Adjusted EBITDA1 guidance of $750 - $765 million2 $ in millions 800 765 750 184 750 700 ~$22 million of growth from organic performance, FX 650 and synergies3 600 551 550 500 3Q16 YTD Adj. EBITDA Q415 Adj. EBITDA Q416 Organic Growth / FX
Slide 14: Platform Objectives
r PLATFORM SPECIALTY Va PR ODUCTS CORPORATION Platform Objectives 14
Slide 15: Platform Objectives: Revenue Growth Equation
Platform Objectives: Revenue Growth Equation MACDERMID PERFORMANCE SOLUTIONS ARYSTA - AGRICULTURAL SOLUTIONS ‘15 – ‘20 CAGR 57 54 51 Assembly Electronics Equipment: 2.7% 47 50 43 2.5% 40 41 Electronics Circuit Boards: 36 32 3333 3.0% 293030302929 Industrial Global GDP: 26 272628 Market1,2 2122 23 24
Slide 16: Platform Objectives: Organic Long-Term Goals
Platform Objectives: Organic Long-Term Goals Ag Solutions LONG-TERM CAGR: ~5% AVERAGE Platform CAGR: SALES Perf Solutions ~4% GROWTH CAGR: 3 – 4% High Single Digit Adj. EBITDA Growth CAGR Adj. EBITDA COGS Reduction: Margin FIVE YEAR ~200 bps Expansion: OPERATING Goal to achieve LEVERAGE Mid-Single D
Slide 17: Key Priorities - 2016
Key Priorities - 2016 Integration and Synergy Realization Focus Commercial Efforts on Fast Growing Niches Establish Operating Rhythm and Momentum Generate Free Cash Flow 17
Slide 18: Appendices
r PLATFORM SPECIALTY Va PR ODUCTS CORPORATION Appendices 18
Slide 19: Non-GAAP Financial Measures
Non-GAAP Financial Measures For purposes of Regulation G, a non-GAAP financial measure is a numerical measure of a company's historical or future financial performance, financial position or cash flows that excludes amounts, or is subject to adjustments that have the effect of excluding amounts, tha
Slide 20: Non-GAAP Definitions
Non-GAAP Definitions Adjusted EBITDA: Adjusted EBITDA is defined as earnings before interest, taxes, depreciation and amortization, as further adjusted for additional items included in earnings that are not representative or indicative of our ongoing business as described in the footnotes to the non
Slide 21: 2015 Net (Loss) Income Reconciliation to Comparable Adjusted EBITDA
2015 Net (Loss) Income Reconciliation to Comparable Adjusted EBITDA Platform Arysta Alent OM OM Comparable Malaysia (amounts in millions) 2015 1/1 - 1/1 – 1/1 – 2015 2015 2/12/2015 11/30/2015 10/27/2015 Net (loss) income available to common stockholders $(309) $(65) $55 $2 $10 $(307) Adjustments to
Slide 22: Comparable Net Income (Loss) Reconciliation to Adjusted EBITDA
Comparable Net Income (Loss) Attributable to Common Stockholders Reconciliation to Adjusted EBITDA (amounts in millions) Q3 2016 Q2 2016 Q1 2016 Q3 YTD Q4 2015 Q3 LTM Net income (loss) attributable to common stockholders $105 $(9) $(135) $(39) $(130) $(169) Pre-acquisition activity of acquired compa
Slide 23: 2015 Reported Segment Results Reconciliation to Comparable Segment Results
2015 Reported Segment Results Reconciliation to Comparable Segment Results 2015 Comparable Sales 2015 Comparable Adj. EBITDA (amounts in millions) (amounts in millions) Performance Solutions $801 Performance Solutions $224 Acquisitions: Acquisitions: Alent 848 Alent 143 OM 142 OM 28 Corporate cost a
Slide 24: Walk to Pro Forma Share Count
Walk to Pro Forma Share Count Series B Pro Forma (amounts in millions) 6/30/2016 Q3 Activity 9/30/2016 Settlement1 9/30/2016 Basic outstanding shares 229.6 48.8 278.4 5.5 283.9 Number of shares issuable upon conversion of Series B Convertible Preferred Stock 22.1 - 22.1 (22.1) - Number of shares iss
Slide 25: Organic Sales Reconciliation
Organic Sales Reconciliation Q1 2016 Q2 2016 Q3 2016 Q3 YTD 2016 (amounts I n millions) $ YoY% $ YoY% $ YoY% $ YoY% Change in net comparable sales $(73) (8.2)% $(30) (3.1)% $25 2.9% $(78) (2.9)% Partial period impacts / dispositions 8 0.9 9 1.0 9 1.1 26 1.0 Foreign exchange impacts 49 5.5 34 3.7 (2)
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