Slide 1: Earnings Conference Call Second-Quarter Fiscal 2021
Earnings Conference Call Second-Quarter Fiscal 2021 April 29, 2021 – 10:00am Eastern Time / efficacy usability allure integrity profitability
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Ashland has identified some of these forward-looking statements with words
Slide 3: Agenda
agenda o Q2 performance summary o Q2 financial results o priorities and outlook o closing comments o Q&A 3
Slide 4: Q2 performance summary
Q2 performance summary «<f Ashland always solving
Slide 5: Commentary on Q2 performance
Ashland Global Holdings Inc. commentary on Q2 performance o year-over-year sales decline of 2%; currency favorably impacted sales by 3% Q2 highlights1 o year-over-year adjusted EBITDA decline of 6% driven by US Gulf Coast winter-storm impact of $11 million and additional sales of $598 million (-2%)
Slide 6: U.S. Gulf Coast freeze impact
Ashland Global Holdings Inc. U.S. Gulf Coast freeze impact oUS Gulf Coast Freeze impact to Q2 Adjusted EBITDA of $11 million o$7 million of lost absorption at affected Texas facilities o$4 million of repair costs for pumps, pipes, and other manufacturing equipment oprimarily impacted Consumer Specia
Slide 7: Q2 financial results
Q2 financial results «<f Ashland always solving
Slide 8: Fiscal-second quarter adjusted results
Ashland Global Holdings Inc. fiscal-second quarter adjusted results1 ($US in millions, except percentages) Q2 FY21 Q2 FY20 change sales $598 $610 (2) % gross profit margin 31.9 % 33.0 % (110) bps SG&A / R&D costs / intangible amortization $118 $127 (7) % operating income $72 $81 (11) % EBITDA $134 $
Slide 9: Consumer Specialties adjusted results summary
Consumer Specialties adjusted results summary1 ($US in millions, except percentages) Q2 FY21 Q2 FY20 change sales $322 $343 (6) % gross profit $113 $128 (12) % gross profit margin 35.1 % 37.3 % (220) bps operating Income $54 $57 (5) % EBITDA $88 $91 (3) % EBITDA margin 27.3 % 26.5 % +80 bps o pharma
Slide 10: Industrial Specialties adjusted results summary
Industrial Specialties adjusted results summary1 ($US in millions, except percentages) Q2 FY21 Q2 FY20 change sales $246 $240 +3 % gross profit $72 $69 +4 % gross profit margin 29.3 % 28.8 % +50 bps operating Income $38 $29 +31 % EBITDA $62 $53 +17 % EBITDA margin 25.2 % 22.1 % +310 bps o continued
Slide 11: Intermediates & Solvents adjusted results summary
Intermediates & Solvents (I&S) adjusted results summary1 ($US in millions, except percentages) Q2 FY21 Q2 FY20 change sales $37 $37 - gross profit $6 $4 +50 % gross profit margin 16.2 % 10.8 % +540 bps operating Income $3 $2 +50 % EBITDA $7 $5 +40 % EBITDA margin 18.9 % 13.5 % +540 bps o volumes of
Slide 12: Free cash flow
Ashland Global Holdings Inc. free cash flow o generated free cash flow of $40 million compared to $10 million in prior-year Q2 o year-over-year increase of $30 million o improvement driven by lower capital expenditures, cash interest and cash taxes o expect Adjusted EBITDA to free cash flow conversi
Slide 13: Q2 results takeaways
Ashland Global Holdings Inc. Q2 results takeaways o excluding the “freeze” impact, all business segments generated strong growth in adjusted EBITDA and adjusted EBITDA margin o higher corporate expense due to favorable items in the prior-year period and unfavorable items in the current-year period o
Slide 14: Priorities and outlook
oriorities and outlook «<f Ashland always solving
Slide 15: Our priorities
Ashland Global Holdings Inc. our priorities margin expansion business resilience o 2021 COGS/SARD reduction o business unit focus o S&OP discipline (increase BU o innovation and mix operating visibility) improvement o organizational ownership / o exit lower-margin product accountability lines o alig
Slide 16: Schülke & Mayr acquisition update
Ashland Global Holdings Inc. Schülke & Mayr acquisition update o announced signing of definitive agreement to acquire Schülke & Mayr personal-care business for €262.5 million o broadens breadth of specialty additive solutions and expands our biotechnology and microbiology technical capabilities o bu
Slide 17: Market demand outlook
Ashland Global Holdings Inc. market demand outlook o continued strong Pharma and Nutraceutical demand o demand recovery delayed for several Personal Care consumer-behavior-driven segments o stronger industrial demand continues o contractor-driven segments adapting to COVID (globally) o consumer dema
Slide 18: COVID-19 global recovery
Ashland Global Holdings Inc. COVID-19 global recovery Ashland FY2020 geographic sales mix current daily length of time to region vaccination rate achieve 75% (excl. Performance Adhesives and I&S) (MMs per day) vaccinated Latin America & Other, 8% US 3.3 3 months EU 2.4 8 months India 3.3 19 months N
Slide 19: COVID impact on PCHH demand
Ashland Global Holdings Inc. COVID impact on PCHH demand1 denture adhesives hair styling o government lockdowns – particularly in Western o COVID-19 pandemic impacted consumer Europe – and 2nd wave of COVID resulted less habits with stay-at-home orders and less dining out socializing activities o le
Slide 20: Outlook
Ashland Global Holdings Inc. outlook providing specific outlook ranges for the fiscal year forward-looking insights strong demand but changing mix o o stable Life Sciences demand growth FY2021 sales o delayed demand recovery in several personal care segments $2.4 – $2.5 billion o continued recovery
Slide 21: Maintaining focus
Ashland Global Holdings Inc. maintaining focus businesses performing in line with expectations advancing strategic initiatives (and M&A) commercial and innovation activities self-help actions managing pricing/raw-material dynamics COVID recovery and raw-material supply stabilization remain and +/- u
Slide 22: Closing comments
closing comments «<f Ashland always solving
Slide 23: Premier specialty materials company
Ashland Global Holdings Inc. premier specialty materials company o focused on high-quality markets and businesses with exciting profitable growth opportunities o franchise businesses have leadership positions • #1 or #2 • strong teams with deep industry expertise • excellent customer relationships a
Slide 24: Thank you and Q&A
thank you and Q&A ofAshland
Slide 25: Appendix A: adjusted results summary and balance sheet
appendix A: adjusted results summary and balance sheet
Slide 26: Adjusted results summary
Ashland Global Holdings Inc. adjusted results summary1 ($US in millions, except percentages and Q2 FY21 Q2 FY20 change per share data) sales $598 $610 (2) % gross profit $191 $201 (5) % gross profit margin 31.9 % 33.0 % (110) bps SG&A / R&D costs / intangible amort. $118 $127 (7) % Photo operating i
Slide 27: Q2 business unit consolidation
Ashland Global Holdings Inc. Q2 business unit consolidation1 ($US in millions, except Consumer Industrial interco. unallocated I&S Ashland percentages) Specialties Specialties eliminations and other sales $322 $246 $37 ($7) - $598 gross profit $113 $72 $6 - - $191 gross profit margin 35.1 % 29.3 % 1
Slide 28: Liquidity and net debt
Ashland Global Holdings Inc. liquidity and net debt Moody’s 3/31/21 ($US in millions) expiration interest rate S&P rating rating balance cash $373 revolver and A/R facilities availability 610 cash, A/R and revolver availability1 $983 US A/R sales program1 $107 Photo debt 2.00% notes (EUR) Jan. 2028
Slide 29: Appendix B: non-GAAP reconciliation
appendix B: non-GAAP reconciliation1 1 Although Ashland provides forward looking guidance for adjusted EBITDA in this presentation, Ashland is not reaffirming or providing forward-looking guidance for U.S. GAAP reported financial measures or a reconciliation of forward-looking non-GAAP financial mea
Slide 30: Segment Components of Key Items, 3 Months Ended March 31, 2021
Ashland Global Holdings Inc. and Consolidated Subsidiaries Segment Components of Key Items for Applicable Income Statement Captions for 3 Months Ended March 31, 2021 ($ millions) Three Months Ended March 31, 2021 Personal Care Life and Consumer Specialty Performance Industrial Intermediates Unalloca
Slide 31: Segment Components of Key Items, 3 Months Ended March 31, 2020
Ashland Global Holdings Inc. and Consolidated Subsidiaries Segment Components of Key Items for Applicable Income Statement Captions for 3 Months Ended March 31, 2020 ($ millions) Three Months Ended March 31, 2020 Personal Care Life and Consumer Specialty Performance Industrial Intermediates Unalloca
Slide 32: Free Cash Flow and Adjusted Operating Income
Ashland Global Holdings Inc. and Consolidated Subsidiaries Reconciliation of Non-GAAP Data – Free Cash Flow and Adjusted Operating Income for 3 Months Ended March 31, 2021 and 2020 ($ millions) Three months ended Six months ended March 31 March 31 Free cash flows (a) 2021 2020 2021 2020 Total cash f
Slide 33: Reconciliation of Non-GAAP Data – Adjusted EBITDA
Ashland Global Holdings Inc. Reconciliation of Non-GAAP Data – Adjusted EBITDA for 3 Months Ended March 31, 2021 and 2020 ($ millions) Three months ended March 31 Adjusted EBITDA - Ashland Global Holdings Inc. 2021 2020 Net income (loss) $ 41 $ (582) Income tax Ashland expense (benefit) - (10) Net i
Slide 34: Adjusted EBITDA – Consumer Specialties
Consumer Specialties Reconciliation of Non-GAAP Data – Adjusted EBITDA for 3 Months Ended March 31,2021 and 2020 ($ millions) Three months ended March 31 Life Sciences 2021 2020 Operating income $ 35 $ 36 Add: Depreciation and amortization 15 15 Operating key items (see Slides 31 and 32) - 1 Adjuste
Slide 35: Adjusted EBITDA – Industrial Specialties, Intermediates and Solvents
Industrial Specialties, Intermediates and Solvents Reconciliation of Non-GAAP Data – Adjusted EBITDA for 3 Months Ended March 31, 2021 and 2020 Three months ended ($ millions) March 31 2021 2020 Specialty Additives Operating income (loss) $ 19 $ (161) Add: Depreciation and amortization 21 20 Operati
Slide 36: Adjusted Income from Continuing Operations
Ashland Global Holdings Inc. and Consolidated Subsidiaries Reconciliation of Non-GAAP Data – Adjusted Income from Continuing Operations for 3 Months Ended March 31, 2021 and 2020 Three months ended Six months ended March 31 March 31 ($ millions) 2021 2020 2021 2020 Income (loss) from continuing oper
Slide 37: Adjusted Diluted EPS from Continuing Operations
Ashland Global Holdings Inc. and Consolidated Subsidiaries Reconciliation of Non-GAAP Data – Adjusted Diluted EPS from Continuing Operations for 3 Months Ended March 31, 2021 and 2020 Three months ended Six months ended March 31 March 31 ($ millions) 2021 2020 2021 2020 Diluted EPS from continuing o
Slide 38: Trademark notices
® Registered trademark, Ashland or its subsidiaries, registered in various countries ™ Trademark, Ashland or its subsidiaries, registered in various countries