Chemical Solutions Business Overview Chris Siemer, President, Chemical Solutions Chemical Solutions Business Overview
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Chemical Solutions Business Overview Chris Siemer, President, Chemical Solutions Chemical Solutions Business Overview BUSINESS OVERVIEW FINANCIAL SUMMARY • Significant portfolio rationalization since spin $ Millions 2015 2016 TTM 3Q171 • Portfolio of industrial businesses primarily Revenue 1,095 772 567 operating in the Americas Adjusted EBITDA 29 39 46 • Reputation for safety, reliability and Adj. EBITDA Margin 2.6% 5.1% 8.1% stewardship • Three production facilities located in North America Geography2 Product2 Mining Solutions – sodium North America – Memphis, TN: Mining Solutions EMEA Divestitures / Other cyanide, hydrogen cyanide 4% 56% 1% – Belle, WV: PC&I Performance Chemicals & Asia – Pascagoula, MS: PC&I Pacific Intermediates – 12% methylamines, glycolic acid, Vazo™ products, aniline, nitrobenzene Mining PC&I Latin Solutions 52% America 47% 28% Source:Company filings and data 1. Results on a trailing twelve-month basis ending 3Q17 2. Segment net sales on a trailing twelve-month basis ending 3Q17 See reconciliation of Non-GAAP measures in our appendix 2 Performance Chemicals & Intermediates Overview BELLE, WV OVERVIEW MANUFACTURING SITE • Manufactures an array of products • Attractive industrial site with for use in industrial and consumer advantaged infrastructure applications and logistics • Two production facilities: • Potential tenant opportunities Pascagoula, MS and Belle, WV • Transformed financial and • Belle Products: operational performance – Methylamines >$20M Belle Cost Reduction – Vazo™ initiators – Glycolic Acid Glycolic Acid Molecule At Spin TTM 3Q’17 On a trailing twelve month basis ending 3Q17 Profitability Stabilized, on a Path Towards Growth 3 Sodium Cyanide is a Critical Enabler of Gold Mining Leaching Crushed ore WHAT DOES SODIUM CYANIDE DO? • Used to extract gold and silver during ore processing Leaching pad • 90% of gold production globally utilizes sodium Processing cyanide (NaCN) – Lowest environmental impact among alternative * Carbon columns Sodium Cyanide gold ore processing methods • NaCN growth driven by: Refining – Increasing consumption rates per ton of ore processed as average gold content in ores declines globally – Increasing ore tonnage processed as gold content in ores declines globally Smelter doré Refinery Gold – Independent of gold price * Source: European Commission Sodium Cyanide Is the Most Economically Viable and Environmentally Sustainable Technology for Gold Ore Processing 4 Sodium Cyanide Demand Growth Global ore processing is growing at a rapid pace as ore grade quality has declined Total Global Ore Tonnage Processed Total Processed Ore Grade 3.0 3.00 2.5 2.50 2.0 2.00 1.5 1.50 1.0 1.00 0.5 0.50 Processed ore grade (g/t) grade ore Processed Tonnage processed (Bt) processed Tonnage 0.0 0.00 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 Source: Wood Mackenzie NaCN Is the Most Economically Viable and Environmentally Sustainable Technology for Gold Ore Processing 5 Mining Solutions Overview • Manufactures two cyanide products: CHEMOURS IS #1 IN SODIUM CYANIDE IN AMERICAS1 – Hydrogen Cyanide (HCN): Used as precursor for NaCN production and acrylics 38% – Sodium Cyanide (NaCN): Critical enabler of precious metal mining 28% • Strong logistics network in the Americas • Largest producer of solid sodium cyanide globally 10% 9% • Differentiated product stewardship 6% 6% Cyanco Chinese CyPlus Orica Others Producers Solid Solution Mexico Expansion PF Source: IHS, Management estimates 1 Pro forma for construction of Mexico capacity. Attractive Growth & Profitability Profile; Positioned to Win in the Americas 6 Mexico Capacity Expansion Strategically Located • Construction of 50 KTA manufacturing facility in Durango, Mexico commenced in July 2017, with expected completion by the end of 2018 • Americas region represents most attractive NaCN market globally • Mexico is the largest single market in the Americas, ~40% of Americas demand • Local presence enables: – Expanded local inventory Gold Mine – Lower logistics costs Silver Mine – Improved customer support Americas NaCN Demand Growing at ~9% Through 2021 7 Chemours Chemical Solutions Potential Long Term • Strong and growing market position for Growth Mining Solutions High Growth Growing Cyclical Profitability • Targeted investments in High Value key product lines Commodity Chemistry • Continuous focus on Strong Attractive Sustainable Organic reducing costs and Positions Investments optimizing Belle Uncertainty Investable infrastructure 8 9.