https://www.avient.com/sites/default/files/2023-05/AVNT Q1 2023 Earnings Presentation.pdf
GUIDANCE (TOTAL COMPANY) 7 14.8% 15.8% Guidance Actual Adjusted EBITDA Margin % Better-than-expected margins driven by: • Resilient demand for composites and sustainable solutions which improved mix of higher margin applications • Deceleration of raw material inflation • Cost reduction activities Q1 EBITDA BRIDGE (TOTAL COMPANY) 8 $ millions CAI: Price / Mix 19) Inflation (4) SEM: Price / Mix 6) Inflation (4) Net Price Benefit 17) Wage and Energy Inflation (13) Cost Reductions 8) FX (6) Q1 2023 Actual $134) Adjusted EBITDA Q1 2022 Pro Forma $ 176) Demand (48) • Weak demand conditions in-line with previous expectations • Pricing continues to cover inflation of raw materials, wages and energy U.S. & Canada 40% EMEA 38% Asia 17% Latin America 5% Q1 2023 SEGMENT, END MARKET AND GEOGRAPHY GEOGRAPHY REVENUESEGMENT FINANCIALS Consumer 18% Packaging 23% Healthcare 7% Industrial 16% Building and Construction 10% Defense 6%Telecommunications 4% Energy 5% END MARKET REVENUE (1) Total company sales and adjusted EBITDA of $846M and $134M, respectively, include intercompany sales eliminations and corporate costs $537M $91M $310M $64M Sales EBITDA Specialty Engineered Materials Color Additives and Inks $134M$846M (1) 9 Transportation 11% Q1 2023 SALES BY REGION Yo Y C H A N G E ( E X C L .
National Defense budget of $842 billion submitted to Congress in Q1 2023 • European NATO members annual defense spend expected to increase by up to 20% Where Avient Wins: Dyneema® is the world’s strongest fiber™ One of the highest strength to weight ratios of any material on Earth Direct relationships with industry leading armor manufacturers Resistant to most chemicals, UV, and moisture to handle any environment Avient Confidential 13 DEFENSE Source: US Department of Defense, defense.gov, NATO13 Source: TRANSPORTATION • Increased EPA regulations requiring improved fuel efficiency, enabled in part by lower-weight vehicles • Automakers preparing for 2/3 of U.S. vehicles to be 100% electric by 2032 Where Avient Wins: Lightweight panels that establish both strength and stiffness resulting in decreased energy usage, lower emissions Long-lasting Color applications to resist UV exposure, temperature fluctuations and exceed the stylistic requirements of global automakers 14 $130 $530 Q2 FY $0.60 $2.40 Q2 FY 2023 GUIDANCE 15 Sales Adjusted EBITDA $845 $3,400 Q2 FY Adjusted EPS (in millions) (in millions) CASH FLOW / LEVERAGE 16 • Maintaining free cash flow and leverage guidance from February earnings call • IT investment to further integrate acquired businesses and capture operational efficiencies • Restructuring actions to streamline operations and improve profitability, primarily in Europe ($ millions) 2023E Cash Flow from Operating Activities 350$ Less: Run-Rate CapEx (110) CapEx for IT System Upgrade (25) CapEx for Restructuring (15) Total CapEx (150) Free Cash Flow 200$ Adjusted EBITDA 530$ Net Debt / Adjusted EBITDA 2.9x LONG-TERM REVENUE GROWTH DRIVERS Growth Drivers Long-Term Growth Rate Sustainable Solutions 8–12% Healthcare 8–10% Composites 10% Asia / LATAM 5% Other (GDP growth) 2–3% Avient 6.5% 17 Sustainable Solutions 32% Asia / LATAM 15% Composites 8% Healthcare 6% Other (GDP Growth) 39% • Virtual presentation to be held September 20, 2023 • The company will be conducting an investor-focused presentation around our sustainability solutions portfolio Avient Confidential 18 SUSTAINABILITY INVESTOR DAY 18 $340M $405M $455M $550M $790M $915M 2016 2017 2018 2019 2020PF** 2021 2022PF*** SUSTAINABILITY FOR A BETTER TOMORROW Revenue From Sustainable Solutions* 2016-2022 ($ in millions) Organic Future Growth Revenue Assumptions From Sustainable Solutions: 8 - 12% 19 *Avient Sustainable Solutions definitions aligned with FTC 2012 Guide for the Use of Environmental Marketing Claims (“Green Guides”) **2020 is Pro Forma to include full year of the Clariant Color business ***2022 is Pro Forma for the acquisition of Avient Protective Materials and the divestiture of Distribution $1,175M Lightweighting Eco-Conscious Recycle Solutions VOC Reduction Sustainable Infrastructure Human Health & Safety Reduced Energy Use Bio-polymers SUSTAINABILITY NEEDS BY MARKET B&C • Eco-Conscious • Carbon footprint • Resource conservation Healthcare • Carbon footprint • Bio based content • Eco-Conscious Automotive • Light weighting • Recycled Content • VOC reduction Consumer • Recycle Solutions • Light weighting • Carbon Footprint Packaging • Recycle Solutions • Light weighting • Food waste reduction Common Theme: CO2 Emission Goals Increasing Single-Use Plastic Regulation 20 INVESTING IN INNOVATION S U S T A I N A B I L I T Y P O R T F O L I O 21 AP P EN D IX 24 RAW MATERIAL 2022 ANNUAL PURCHASES Performance Additives 16% Pigments 12% TiO2 10% Dyestuffs 2% Polyethylene 11% Nylon 6% Polypropylene 5% Styrenic Block Copolymer 5% Other Raw Materials 33% ~40% hydrocarbon based (Grey shaded materials are hydrocarbon based, includes portion of “Other Raw Materials”) Non-hydrocarbon based materials • Cost inflation decelerating, particularly for hydrocarbon-based raw materials 2022 pro forma results for the acquisition of Avient Protective Materials SEGMENT DATA U.S. & Canada 40% EMEA 37% Asia 18% Latin America 5% 2022 PRO FORMA SEGMENT, END MARKET AND GEOGRAPHY GEOGRAPHY REVENUESEGMENT FINANCIALS Consumer 20% Packaging 24% Industrial 15% Building and Construction 10% Telecommunications 4% Energy 4% Defense 6% END MARKET REVENUE $2,355M $402M $1,300M $272M Sales EBITDA Specialty Engineered Materials Color Additives and Inks $592M$3,653M (1) Transportation 9% Healthcare 8% 26 (1) Total company sales and adjusted EBITDA of $3,653M and $592M, respectively, include intercompany sales eliminations and corporate costs C O L O R , A D D I T I V E S & I N K S 2022 REVENUE | $2 .4 B ILL ION US & Canada 34% EMEA 38% Asia 20% Latin America 8% END MARKET REGION 27 Packaging 34% Consumer 21% Healthcare 8% Industrial 15% Transportation 8% Building & Construction 11% Telecommunications 1% Energy 2% S P E C I A LT Y E N G I N E E R E D M AT E R I A L S 2022 PRO FORMA REVENUE | $1 .3 B ILL ION END MARKET US & Canada 52% EMEA 35% Asia 13% REGION 28 Packaging 5% Consumer 19% Healthcare 8%Industrial 16% Transportation 10% Telecommunications 10% Energy 9% Defense 15% Building & Construction 8% Packaging 32% Consumer 27% Healthcare 8% Industrial 14% Building & Construction 5% Telecommunications 3% Energy 1% Defense 1% Asia (18% of sales) Transportation 9% 2022 PROFORMA AVIENT REGIONAL SALES BY END MARKET Packaging 27% Consumer 14% Healthcare 5% Industrial 17% Building & Construction 10% Energy 5% Defense 8% EMEA (37% of sales)Transportation 11% Packaging 13% Consumer 24% Healthcare 12% Industrial 15% Building & Construction 13% Energy 5% Defense 5% US & Canada (40% of sales) Transportation 7% Packaging 56% Consumer 23% Healthcare 4% Industrial 7% Building & Construction 4% Telecommunications 1% LATAM (5% of sales) Transportation 5% Telecommunications 3% Telecommunications 6% 29 PEER COMPARISONS AVIENT IS ASSET LIGHT Capex / Revenue 2023E (%) Avient Specialty Formulators Other Specialty / Chemical Companies Source: Peer data per Bloomberg as of April 28, 2023 Note: Avient reflects 2023 estimated revenue of $3,400 and estimated run-rate CAPEX of $110M. 31 3 2 3 3 4 4 3 3 5 5 5 6 7 9 A vi en t K W R P P G F U L R P M A V Y F M C H U N H X L C E E C L A S H E M N S C L FREE CASH FLOW CONVERSION Source: Peer data per Bloomberg as of April 28, 2023 Note: Free cash flow conversion calculated as (Adjusted EBITDA – Capex) / Adjusted EBITDA.
https://www.avient.com/sites/default/files/2021-09/avient2020sustainabilityreport-9-2-21.pdf
In addition to this, many of our innovation focus areas support the fight against climate change: lightweighting, eco-conscious solutions, recycle solutions, volatile organic compound reduction, bio-polymer solutions, and reduced energy use.
We actively design our solutions to our customers' sustainability needs, including lightweighting, improved recycle solutions and eco-conscious benefits.
These solutions offer high clarity and bond to a variety of substrates.
https://www.avient.com/sites/default/files/2021-11/artisan-ar7300-pre-colored-formulation-processing-guide.pdf
PROBLEM CAUSE SOLUTION Incomplete Fill Melt and/or mold temperature too cold • Increase nozzle and barrel temperatures • Increase mold temperature • Increase injection rate • Check thermocouples and heater bands Shot size • Increase shot size • Adjust transfer position to 98% full • Increase cushion Mold design • Enlarge or widen vents and increase number of vents • Check that vents are unplugged • Check that gates are unplugged • Enlarge gates and/or runners • Perform short shots to determine fill pattern and verify proper vent location • Increase wall thickness to move gas trap to parting line Brittleness Degraded/overheated material • Decrease melt temperature • Decrease back pressure • Use smaller barrel • Decrease injection speed Gate location and/or size • Relocate gate to non-stress area • Increase gate size to allow higher flow rate and lower molded-in stress Wet material • Check moisture.
Sink Marks Melt too hot • Decrease nozzle and barrel temperatures • Decrease mold temperature Insufficient material volume • Adjust transfer position • Increase shot size • Increase injection rate • Increase packing pressure Part geometry too thick • Reduce wall thickness • Reduce rib thickness TROUBLESHOOTING RECOMMENDATIONS PROBLEM CAUSE SOLUTION Flash Injection pressure too high • Decrease injection pressure • Increase clamp pressure • Decrease injection rate • Increase transfer position Excess material volume • Adjust transfer position • Decrease pack pressure • Decrease shot size • Decrease injection rate Melt and/or mold temperature too hot • Decrease nozzle and barrel temperatures • Decrease mold temperature Loose clamp • Reset mold height • Increase clamp tonnage Shrink Too much shrink • Increase cooling time • Decrease mold temperature Too little shrink • Decrease cooling time • Increase mold temperature Burning Process related • Decrease nozzle and barrel temperatures • Decrease mold temperature • Decrease injection rate • Reduce decompression Mold design • Clean, widen and increase number of vents • Increase gate size to reduce shear Wet material • Verify material is dried at proper condition Nozzle Drool Nozzle temperature too hot • Decrease nozzle temperature • Decrease back pressure • Increase screw decompression • Verify material has been dried at proper conditions Incorrect nozzle • Use reverse taper tip Weld Lines Melt front temperatures are too low • Increase injection rate • Increase pack and hold pressure • Increase melt temperature • Increase mold temperature Mold design • Increase gate size • Identify end of fill pattern and verify proper vent location • Add vents or increase vent width • Move gate location TROUBLESHOOTING RECOMMENDATIONS PROBLEM CAUSE SOLUTION Warp Process related • Increase melt temperature • Reduce injection speed • Increase pack pressure • Increase pack time • Decrease mold temperature • Increase cool time Mold design • Non-uniform mold cooling Part design • Non-uniform wall thickness Thermolator incorrect temperature • Check settings • Inspect thermocouple Sticking in Mold Overfilled cavity • Decrease injection rate and pressure • Decrease hold pressure • Adjust transfer position • Decrease nozzle and barrel temperatures • Decrease mold temperature • Decrease cooling time Part too hot • Decrease barrel temperature • Decrease mold temperature • Increase cooling time Mold design • Increase draft angle • Polish cores in direction of ejection Black Specks Contamination • Purge machine Degradation • Reduce melt temperature • Reduce screw speed • Reduce back pressure Machine related • Check for wear on screw, barrel or check ring Delamination Process related • Increase melt temperature • Decrease injection speed • Purge barrel to eliminate material contamination Mold design • Reduce sharp corners in material flow path • Increase venting TROUBLESHOOTING RECOMMENDATIONS PROBLEM CAUSE SOLUTION Discoloration Oversheared material • Decrease melt temperature • Decrease injection speed • Reduce residence time Mold design • Increase gate sizing Dry material • Check moisture of material to ensure it is within the recommended moisture percentage for molding TROUBLESHOOTING RECOMMENDATIONS 1.844.4AVIENT www.avient.com Copyright © 2021, Avient Corporation.
https://www.avient.com/sites/default/files/2022-04/Avient Announces Agreement to Acquire Dyneema_0.pdf
AVNT-2022.03.31-News Release - Dyneema 1 NEWS RELEASE FOR IMMEDIATE RELEASE Avient Announces Agreement to Acquire DSM Protective Materials (Dyneema®) and Plans to Explore Sale of Distribution CLEVELAND – April 20, 2022 – Avient Corporation (NYSE: AVNT), a leading provider of specialized and sustainable material solutions, today announced that it has entered into an agreement with Royal DSM (“DSM”) to purchase the DSM Protective Materials business (including the Dyneema® brand) (the “Dyneema business”).
About Avient Avient Corporation (NYSE: AVNT), with 2021 revenues of $4.8 billion, provides specialized and sustainable material solutions that transform customer challenges into opportunities, bringing new products to life for a better world.
Examples include: • Unique technologies that improve the recyclability of products and enable recycled content to be incorporated, thus advancing a more circular economy • Light-weighting solutions that replace heavier traditional materials like metal, glass and wood, which can improve fuel efficiency in all modes of transportation and reduce carbon footprint • Sustainable infrastructure solutions that increase energy efficiency, renewable energy, natural resource conservation and fiber optic / 5G network accessibility Avient employs approximately 8,700 associates and is certified ACC Responsible Care®, a founding member of the Alliance to End Plastic Waste and certified Great Place to Work®.
https://www.avient.com/sites/default/files/2022-02/AVNT Q4 2021 Earnings Presentation_0.pdf
Purchase price multiple rapidly declining on strength of business and synergy capture 10 $133 $205 2019PF 2021 10 Clariant Color EBITDA Growth Purchase Price Multiple 10.8x 7.0x 6.1x 2019PF 2021 2021 w/ Full Synergies (1) (1) 11.9% 16.2% 2019PF 2021 EBITDA Margins (1) CLARIANT COLOR: TRANSFORMATIONAL ACQUISITION ($ in millions) (1) Financial information is pro forma to include a full year of Clariant Color business ($ millions) Initial Synergy Estimate 2021 Synergy Realization Total Synergies Expected Administrative $ 18 $ 29 $ 40 Sourcing 24 20 24 Operational 18 5 21 Total Synergies $ 60 $ 54 $ 85 CLARIANT COLOR INTEGRATION & COST SYNERGIES UPDATE 11 • Integration going extremely well: synergy target increased to $85 million at December 9th Investor Day • Relentless focus on guiding principles of safety first, employee collaboration and exceeding customer expectations • Future revenue synergies are not part of these estimates and represent additional growth over the long term SUSTAINABILITY FOR A BETTER TOMORROW 12 • Revenue from sustainable solutions grew 16% in 2021 and expected to grow 8-12% in 2022 as our innovation efforts and collaboration with customers accelerates • Investments centered around innovation and global sustainability megatrends o Enabling a circular economy – Technologies that allow for increased use of post-consumer recycled (PCR) material and improve recyclability of plastics o Light-weighting – Composites and CAI applications to reduce weight and material requirements, which minimize energy and carbon emissions o Eco-Conscious – Health and human safety applications as well as Avient’s alternative materials to replace lead, PVC, halogens, BPA and other less eco-friendly options 12 *Avient Sustainable Solutions definitions aligned with FTC 2012 Guide for the Use of Environmental Marketing Claims (“Green Guides”) **2020 is Pro Forma to include full year of the Clariant Color business 12 2016 2017 2018 2019 2020PF** 2021 $405M $455M $550M $790M Revenue From Sustainable Solutions* 2016-2021 $915M $340M PEOPLE C U L T U R E I S E V E R Y T H I N G Community Service 7x Safer than Industry Average World-Class Safety Leadership Development Over $16 million raised since 2010 Diversity & Inclusion 13 Q4 2020 $997 $80 Sustainable Solutions 23 12% 8 Healthcare 53 43% 9 Composites 7 22% 2 Growth in Asia / LATAM 14 10% 3 Other 118 23% 2 Sub-total $1,212 22% $104 Wage Inflation and Overtime (11) Other Supply Chain Costs (4) Synergies 9 Incentives, FX, Other Employee Costs (10) (13) Q4 2021 $1,202 21% $85 Q4 2021 SALES AND OPERATING INCOME (TOTAL COMPANY) 14 Sales Growth Rate Adjusted Operating Income$ millions Adjusted EBITDA Q4 EBITDA BRIDGE 15 Price increases more than offsets raw material and supply chain impacts Q4 2020 $ 118 Demand - $ millions CAI: Price / Mix 62 Inflation (45) SEM: Price / Mix 25 Inflation (20) Distribution: Price / Mix 114 Inflation (109) Net Price Benefit 27 Wage Inflation and Overtime (11) Other Supply Chain Costs (4) Synergies 9 Incentives, FX, Other Employee Costs (13) Q4 2021 $ 126 Transportation (5)$ Outdoor High Performance (3) Other 8 Total Demand - Q4 2021 SEGMENT PERFORMANCE 16 CAI $526 $581 Sales ($ in millions) SEM Distribution $58 $61 Operating Income + 11% + 6% $305 $425 Sales $18 $22 Operating Income + 39% + 22% (1) $191 $228 Sales $30 $29 Operating Income + 19% - 3% 2022 O U TLO O K REVENUE GROWTH DRIVERS Growth Drivers Long-Term Growth Rate 2022E Growth Rate Sustainable Solutions 8–12% 12% Healthcare 8–10% 10% Composites 10% 3% Asia / LATAM 5% 6% Other (GDP growth) 2–3% 2–3% Avient 6.5% 6% 18 Excluding Outdoor High Performance 13% (7.5% excl.
29 We are a specialty formulator that enables many of the world’s products through innovation and custom solutions.
We will deliver for our stakeholders through multiple value creation levers—many of which are unique to Avient: o Demand for sustainable solutions, healthcare, and composites, together with Clariant Color revenue synergies, that will drive long-term revenue growth in excess of GDP o Clariant color cost synergy capture will result in significant near-term benefit In addition, we remain committed to increasing annual dividends in line with earnings growth and opportunistically buying back shares, all while remaining modestly levered.
https://www.avient.com/sites/default/files/2022-05/ColorMatrix Amosorb Solo Technical Bulletin.pdf
ColorMatrix™ Amosorb™ SolO2: a recyclable solution Recyclability has become a fundamental requirement for convertors and brand owners.
Providing solutions that are considered recyclable within the colored bottle stream will thus be an integral part of the recyclability strategy for both convertors and brand owners.
Zero Waste Europe Avient is committed to playing its part in this recyclability journey and helping achieve such ambitious targets by providing solutions that will allow the market to fully achieve these goals.
https://www.avient.com/sites/default/files/2020-12/maxxam-fr-case-study.pdf
AN ALTERNATIVE FLAME RETARDANT SOLUTION FOR CATEGORY CABLES CASE STUDY: MAXXAM™ FR POLYPROPYLENE Challe nge Accepted.
THE SOLUTION The manufacturer worked with Avient to identify alternatives to FEP insulation that would meet requirements in their data cable.
https://www.avient.com/sites/default/files/2023-07/Versaflex HC _ Versaflex HC BIO - BT Series Product Overview.pdf
In addition, these material solutions provide a proven, one-step processing solution to support speed to market and manufacturing efficiencies.
https://www.avient.com/sites/default/files/2022-11/Cesa Fiber Tracer Concentrates Product Bulletin.pdf
Cesa™ Fiber Tracer Concentrates are polymer solutions that include a taggant, unique to the customer/product line, which is incorporated into the fibers during the spin-dyeing process.
KEY BENEFITS • Unique and personalized tracer for customer/ product lines • Suitable for polyester and polyamide (nylon), including recycled grades; possibility to develop solutions for bio-polymers • No impact on spinnability, color or yarn properties • Can be combined with color into a single product for convenience • Complies with key regulatory requirements by EN, DIN, UNI and others • Supplied with a testing service package Copyright © 2022, Avient Corporation.
https://www.avient.com/sites/default/files/2021-07/plastiward-flyer-global.pdf
Standing apart from other industry solutions, PLASTIWARD is a fully integrated turnkey solution empowering your enforcement team to take swift action against fraud.