Braskem S.a. · BMFBOVESPA:BRKM3
Braskem — Q3 2023 Earnings Presentation
58 slides from Braskem's earnings presentation, Nov 9, 2023
Slide 1: Earnings Release 3Q23
Slide 2: Recurring EBITDA and Liquidity highlights
(@) Recurring EBITDA © Liquidity cane Higher than 2023 Guaranteed coverage US$187 million (uss 140 million) and US$3.4 bili of debt maturities, lower than 3022 93.4 Dillion ‘over the next 75 Around R$921 million (USS 371 million) micathe ) Resin sales Brazil C2 rroducton of green ethylene Increase i
Slide 3: Operations
OPERATIONS > Global accident frequency rate (CAF + SAF") of 0.97 (events/MM hours worked), lower (-8%) than 2023 > Utilization rate comparedto previous quarter: + -4p.p. in Brazil + +24p.p. inGreenethylene + +1pp. in U.S. & Europe + -20p.p. in Mexico * Lost time injury and non-lst-time injury. sc »
Slide 4: Main indicators and financial summary
3Q22 Chg. 9M22 Chg. Main Seen meee a (A) yc) ay) __(Ay/(C) (D) (2) (D)/(E) _ Utiization Rate Ethylene (%) 4p.p. — -10p.p. 73% ‘Sales Volume of Main Chemicals (kton) 10% 21% 1,848 ‘Sales Volume of Main Chemicals Exports (kton) 16% 28% 273 Sales Volume of Resins (kton) 12% 1% 2,546 Sales Volume of Res
Slide 5: International references, prices and spreads
3Q23 2Q23 3Q22 Chg. Chg. 9M23 9M22 Chg. International References* (US$/ton) SQ ~ 2 2 a (a) (8) () (A)/(B)_(A)/(C)_(D) (e) (D)/(E) Prices Brent (US$/bbl) 87 78 101 11% 14% 82 105 22% Natural Gas (US$/MMBtu) 3 2 ¥ 20% 64% 2 6 62% Naphtha 638 605 684 6% T% 646 811 -20% Ethane 219 156 406 40% 46% 187 37
Slide 6: Average utilization rate of petrochemical plants
b) Average utilization rate of petrochemical plants: reduction in relation to 2Q23 (-4 p.p.) and in relation to 3Q22 (-10 p.p.) due to (i) the continuous adjustment of production in light of global demand, with emphasis on the unscheduled shutdowns of chemical customers in Brazil; (ii) unscheduled s
Slide 7: Resin sales volume
c) Resin sales volume: in the Brazilian market, resin sales increased in relation to 2Q23 (+12%) due to the seasonality effect of the period, driven mainly by the household appliances, packaging, consumer goods, beverages, hygiene, civil construction sectors, and the milestone of sanitation. Compare
Slide 8: Sales volume of main chemicals
d) Sales volume of main chemicals 3 : in the Brazilian market, sales were lower compared to 2Q23 (-10%), mainly explained by the lower sales volume (i) of propylene and paraxylene due to the scheduled shutdown of customers in the period; and (ii) of gasoline due to lower product availability for sal
Slide 9: Geological event in Alagoas
5.1.2 GEOLOGICAL EVENT IN ALAGOAS The Management of Braskem, based on its assessment and that of its external advisors, considering the measures recommended on technical studies in the short and long-term and the existing information and refined estimates of expenses for implementing several measure
Slide 10: For more information
For more information on advances made on the action fronts related to the geological event in Alagoas during the quarter, see appendix 8.2.
Slide 11: Net Revenue
A) Net Revenue: decreased in U.S. dollar (-6%) and Brazilian real (-8%) in relation to 2Q23 explained by (i) the reduction of 6% in PE prices, 4% in PP prices and 8% in the average price of the main chemicals in the international market; and (ii) the reduction of 59,000 tons, or 10%, in the sales vo
Slide 12: Sales by economic activity, Brazil
Sales by Economic Activity PE | Brazil ‘Sales by Economic Activity PP | Brazil Sales by Economic Activity PVC | Brazil - m - A a 3022 2023 3028 3072 2028 3023 i Food others WM Construction Il Automotive [industrial ‘Ml Cosmetic & Pharmaceutical [il Consumer goods fil Textile Sector Hil Retail Busine
Slide 13: Cost of Goods Sold
B) Cost of Goods Sold (COGS): decreased in U.S. dollar (-8%) and Brazilian real (-9%) in relation to 2Q23, mainly due to (i) the inventory effect of naphtha acquired in previous periods; and (ii) the reduction of 59,000 tons, or 10%, in the sales volume of main chemicals in the Brazilian market and
Slide 14: SG&A expenses and Recurring EBITDA; Renewables
C) SG&A EXPENSES: in U.S. dollar, the increase in relation to 2Q23 (+11%) is due to higher product sales expenses and expenses with third parties. Compared to 3Q22, SG&A expenses remained stable. D) Recurring EBITDA: represented 63% of the Company’s segment consolidated Recurring EBITDA. 5.1.4 RENEW
Slide 15: Green ethylene capacity expansion
4 Due to the conclusion of the project to expand of 60,000 tons of green ethylene capacity at the Rio Grande do Sul unit, the calculation of the utilization rate considers the production capacity of (i) 200,000 tons/year for 3Q22; (ii) 228,000 tons/year for 2Q23; and (iii) 260,000 tons/year for 3Q23
Slide 16: Sales of Green PE
Sales (kton) of Green PE 0) 38 28 3922 2923 Il Green PE Green PE Sales Volume per Region (%) 3022 2023 3023 Mi cxrope Ml Brazil IB south America Asia North america
Slide 17: Net Revenue (Green PE + ETBE)
Net Revenue (Green PE + ETBE) (MM US$) ‘ll Net Revenue “6% > fo 196 3Q22 2Q23 3Q23 ‘Net Revenue of Green PE + ETBE/ on son ara
Slide 18: Average utilization rate of PP plants
b) Average utilization rate of PP plants: remained in line with 2Q23. Production in the United States was higher due to the return of operations after a scheduled maintenance shutdown in 2Q23. In Europe, production volume was lower due to the lower feedstock availability and the planned maintenance
Slide 19: PP sales volume
c) PP sales volume: remained in line with 2Q23. In relation to 3Q22, the higher sales volume (+7%) is mainly explained by the chain destocking process that occurred in 3Q22 due to the impacts of the global economic slowdown.
Slide 20: Sales Volume, US & Europe
Sales Volume (kton) | US & Europe AT ——— | 509 536 543 2923 I PP US and Europe
Slide 21: Net Revenue, US & Europe
A) Net Revenue: higher in U.S. dollar (+8%) and Brazilian real (+6%) compared to 2Q23, given the increase of 7,000 tons, or 1%, in PP sales volume during the period.
Slide 22: SG&A and Recurring EBITDA; Mexico
C) SG&A EXPENSES: in U.S. dollar, increase in relation to 2Q23 (+6%) due to higher sales volume and higher expenses with third parties. In relation to 3Q22, the increase (+4%) is explained by higher expenses with industrial and building services and IT services. D) Recurring EBITDA: Represented 33%
Slide 23: Average utilization rate of PE plants, Mexico
b) Average utilization rate of PE plants: lower compared to 2Q23 (-20 p.p.) and compared to 3Q22 (-10 p.p.) due to (i) unscheduled shutdowns due to failures in the national electrical system caused by electrical storms occurred in the region; and (ii) lower ethane availability from PEMEX. During the
Slide 24: PE sales volume
c) PE sales volume: despite the lower utilization rate of the petrochemical plant in the period, sales volume remained in line when compared to 2Q23 due to inventory optimization. In relation to 3Q22, the increase (+19%) is explained by higher demand in the period, driven by the replenishment of the
Slide 25: Sales Volume, Mexico
Sales Volume (kton) | Mexico +19% 214 214 180 3Q22 2923 3Q23 mre
Slide 26: Net Revenue, Mexico
A) Net Revenue: decreased in U.S. dollar (-10%) and Brazilian real (-11%) in relation to 2Q23, mainly due to the 7% reduction in PE prices in the international market. In Brazilian real, the reduction is also explained by the appreciation in the average of the Brazilian real against the U.S. dollar
Slide 27: Sales by Economic Activity, Mexico
Sales by Economic Activity | Mexico 5% 5% 3 4% 11% 12% 3Q22 2923 3923 Hl bags & Films ME industrial Il Packaging Mothers Bl Hygiene and Cleaning I chemicals Construction & Infrastructure
Slide 28: Cost of Goods Sold, Mexico
B) Cost of Goods Sold (COGS): higher in U.S. dollar (+6%) and Brazilian real (+5%) when compared to 2Q23, mainly due to the 40% and 20% increase of prices in the international market, based on moving average, of ethane and natural gas, respectively. Compared to 3Q22, the decrease in U.S. dollar (-11
Slide 29: SG&A, Recurring EBITDA and Investments
C) SG&A EXPENSES: in U.S. dollar, the increase in relation to 2Q23 (+46%) and 3Q22 (+94%) is mainly explained by the increase in operating expenses with logistics, storage, tanking and third parties. D) Recurring EBITDA: Represented 4% of the Company’s segment consolidated Recurring EBITDA. 5.3.3 IN
Slide 30: Ethane Import Terminal
5.3.3.1 ETHANE IMPORT TERMINAL In September 2021, Braskem Idesa approved and started the Ethane Import Terminal construction project in Mexico, which involves building an ethane import terminal with capacity of 80,000 barrels of ethane per day, enabling Braskem Idesa to operate at 100% of its capaci
Slide 31: Ethane terminal disbursements notes
6 The amounts disbursed by Braskem Idesa include Value Added Tax (VAT). 7 Considers the reimbursement made by Advario in the amount of US$56 million and it includes Value Added Tax (VAT).
Slide 32: Braskem Idesa Debt Profile
Braskem Idesa Debt Profile (US$ million) 09/30/2023 40% 4% 1% 1% 1% 0% 0% eigen eee Ei o 2 09/30/2022 2023 2024 2025 2026 = 2027/2028 ©2028 2030/2031 2032 onwards Cash i Invested in US$ [Ml Foreign Currency [lj SLI- Sustainability-Linked Bond* + SLL ~ Sustainable Linked Bond in foreign currency. Bon
Slide 33: Income Statement
Income Statement 3023 2923 3022 Chg. Ch. 9Mz3 ‘OMZ2 cha. R$ milion @) @) ANB) AC) 0) © (ONG) Gross Revenue 19,275 20,568 29,036 “6% “34% © 62,232 89,778 “31% Net Revenue 16,676 17,756 25,387 6% “34% © 53,878 77,530 “31% Cost of Good Sold (16,108) (47,298) (23,158) 7% “30% (51,865) (66,092) 22% Gross
Slide 34: Net Revenue, Consolidated
Net Revenue (R$ million) | Consolidated 25,387 17,756 16,676 3Q22 2923 3923 MB Brazil (MM USA and Europe MM Exports? [lll Mexico ‘Does not consider feedstock resale and others 2Considers only exports from Brazil
Slide 35: COGS, Consolidated
COGS | Consolidated* 3Q22 2923 3923 MM Naphtha and fl Other Variable lj Natural Gas Condensated Costs? (@ Propylene Il Fixed Costs? Gas Ml Deprec / Amort [ll Sales Freight Ml ElectricEnergy ‘Considers accounting figures “Includes chemicals, aaltves, catalysts, fuels, utliias, among others Includes s
Slide 36: Recurring EBITDA
6.4 RECURRING EBITDA 8 The Company’s Recurring EBITDA in 3Q23 was US$187 million (R$921 million), 34% higher than 2Q23, mainly due to (i) the increase in sales volume of resins in Brazil of 95,000 tons, or 12%, due to the 9% increase in demand for resins in the Brazilian market; (ii) the increase of
Slide 37: Consolidated Financial Result
6.5 CONSOLIDATED FINANCIAL RESULT
Slide 38: Financial expenses and revenue
Financial expenses: increased in relation to 2Q23 (+8%), mainly due to higher expenses (i) with interest due to the increase in gross debt balance during the quarter; (ii) with present value adjustment on transactions with third parties; and (iii) with interest on tax liabilities. Compared to 3Q22,
Slide 39: Net Income (Loss) and Investments
6.6 NET INCOME (LOSS) In the quarter, the Company reported net loss 9 of US$497 million, or R$2.4 billion, mainly due to the impact of exchange variation on the financial result caused by the depreciation of the end-of-period Brazilian real against the U.S. dollar of 4% on the net exposure in the am
Slide 40: Main investments related to Sustainable Development Macro-Goals
In 3Q23, the main investments related to the Sustainable Development Macro-Goals were (ii) the projects associated with reducing CO2 emissions and enhancing the energy efficiency of industrial assets; (ii) the construction of a new fire-fighting water reservoir at the Santo André Industrial Complex;
Slide 41: Global Growth Strategy
6.7.1 GLOBAL GROWTH STRATEGY Aligned with the Company's Corporate Growth Strategy, Braskem continued to focus on the development of several projects related to growth avenues, with emphasis on the following projects. 1. Traditional Business: a. Construction of an Ethane Import Terminal in Mexico The
Slide 42: Cash Flow Generation
‘ash How Generation 3923 2923. 3Q22— Chg. 9M233 9M22 Ch R§ milion (a) (8) )_ca/(B) (AY/(C) (0) © __ wy) Recurring EBITDA ‘921 703—«1,967 31% © 53% 2,688 10,739 -75% Changes in Working Capitalt 1,306 962 (2,586 36% = 49% 2,064 1,124 84% Operational CAPEX. (1,019) (682) (1,142) 50% -11% — (2,639) (2,6
Slide 43: Liquidity position
The liquidity position of US$3.4 billion in September 2023 is sufficient to cover the payment of all debts coming due in the next 75 months, not considering the international stand-by credit facility of US$1.0 billion available through 2026.
Slide 44: Debt Profile
Debt Profile (US$ million) 09/30/2023) 1,000 sais 16% a se we 1 ae on 2m ams, 09/30/2023 2023 2028 a 2030/2031 2032 onwards Cash Wi Total cash Ml Total debt Ml Sustainability linked loan lll Standby * Does not consider the amount of US$35 milion destined tothe Fizancial Compensation and Relocation S
Slide 45: Capital Markets: Stock Performance
7. CAPITAL MARKETS 7.1 STOCK PERFORMANCE On September 29, 2023, Braskem’s stock was quoted at R$20.52 ( BRKM5 ) and US$8.21 ( BAK ). The Company’s shares are listed on the Level 1 corporate governance segment of the B3 – Brasil, Bolsa e Balcão and on the New York Stock Exchange (NYSE) through Level
Slide 46: Performance of Corporate Debt Securities
7.2 PERFORMANCE OF CORPORATE DEBT SECURITIES
Slide 47: Corporate debt securities table
Cupom Var. Var. Var. Outstanding (A) (A)-(B)_(A)-(€)_(A)- (0) Braskem '28 1,175.0 Jan/28 4.50% 7.73% 6.59% 8.21% 3.23% = 2.09% 93.71% Braskem '30 1,500.0 Jan/30 4.50% 8.30% 7.26% 8.11% +~— 3.80% += 2.76% += 3.61% Braskem '31 850.0 Jan/31 8.50% 8.65% N/A N/A 0.15% N/A N/A Braskem '33 1,000.0 Fev/33 7
Slide 48: Alagoas provision action fronts
The current provision can be segregated into the following action fronts: a. Support Support for relocating and compensating: Refers to actions to support for relocating and compensating for the residents, business and real state owners of properties located in the Civil Defense Map (version 4) upda
Slide 49: Consolidated Recurring EBITDA Calculation
8.4 CONSOLIDATED RECURRING EBITDA CALCULATION
Slide 50: Recurring EBITDA by Segment
8.5 RECURRING EBITDA BY SEGMENT
Slide 51: Financial Overview by segment (R$ million)
Revenue COGS Financial Overview (R$ milion) CONSOLIDATED 3923, Brasit 1492 (11,247) 245 U.S. and Europe 447 (4.288) 159 Mexico 1,056, (4337) (st) ‘Segments Total 76995 (26,673) 323 ‘Other Segments 210 @) 13 Corporate Unit - e : Eliminations and Reclassifications* (530) 632 102 Braskem Total 16,676 (
Slide 52: Financial Overview by segment (US$ million)
‘Oth Fancial Overview (USS milion) CONSOLIDATED 3923 Net Revenue COGS. ee ey Brat 2354 (2305) 3 2) - (2) (2) 15 US. and Europe st (@78) 3 os) : 2 5 60 Mexico 217 x) (s) os) = 1 =) 8 “Segments Total 301416) 65 (sa) 24 75) Fr} ‘Other Segments! © (a) 23 @ @ CO 25 30 Coporate Unt E E z 65) = 16 03) 2) E
Slide 53: Indicators
Indicators 3Q23 2923 3Q22 Chg. Chg. US$ million (A) (B) (c) (A)/(B) (A)/(C) Recurring EBITDA 187 140 371 34% 50% EBITDA Margin? 5% 8% 2pp. 2pp. ‘SG&A/Net Revenue (%) 7% 5% pp. 2pp. 6% Adjusted Net Debt 5,172 4,979 4,639 4% Adjusted Net Debt/Recuring EBITDA (LTM)? 12.21x 7.90x 155x 55% Recurring EBIT
Slide 54: Consolidated Balance Sheet
Sep/23 Jun/23 Change (a) (B) (a)/(B) Current 37,276 34,339 9% Cash and Cash Equivalents 13,637 13,240 3% Marketable Securities/Held for Trading 5,042 2,340 115% Accounts Receivable 3575 3,057 17% Inventories 12,476 12,985 -4% Recoverable Taxes 1168 1,250 7% Prepaid expenses 470 494 5% Derivatives 16
Slide 55: Consolidated Cash Flow
Consolidated Cash 2023-322 Change Change 9M22 Chang (8) © AB AIO © ow Profit (Loss) Before Income Tax and Social Contribution (3,030) (4,480) (4,005) 705% na. (4,366) 2,274 ‘Adjust for Result Restatement Depreciation and Amortization 1285 1,304,176 -19% 9% 3,820 3,302 16% Equity Result 3 2 0 70% «=
Slide 56: Braskem Idesa Balance Sheet
8.10 BRASKEM IDESA BALANCE SHEET
Slide 57: Braskem Idesa Balance Sheet
Sep/23 jun/23 Chai ASSETS (R$ milion) sh sas oy (a) (8) (A)/(B) Current 3,018 3,135 Cash and Cash Equivalents 1,438 1A78 =3% Accounts Receivable 105 296 64% Inventories 830 935 “11% Recoverable Taxes 466 374 25% Other 178 51 249% ‘Non Current 17,241 15,963 8% Taxes Recoverable 303 282 7% Deferred In
Slide 58: Forward-looking statements
This report on Form 6-K may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are statements that are not historical facts, and are based on our management’s current view and estimates of future economic and other circumst