Eastman Chemical : Circular Economy Deep Dive Presentation

EMN

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Circular Economy Deep Dive

November 21, 2024

Strategy overview

Mark Costa

Board Chair and CEO

Public webcast

These slides should be reviewed with the public webcast presentations to which they relate, a replay of which is posted on our website at "investors.eastman.com."

Forward-looking statements

The information in this presentation and other statements by the company may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act with respect to, among other items: projections and estimates of earnings, revenues, volumes, pricing, margins, cost reductions, expenses, taxes, liquidity, capital expenditures, cash flow, dividends, share repurchases or other financial items, statements of management's plans, strategies and objectives for future operations, and statements regarding future economic, industry or market conditions or performance. Such projections and estimates are based upon certain preliminary information, internal estimates, and management assumptions, expectations, and plans. Forward-looking statements are subject to a number of risks and uncertainties, and actual performance or results could differ materially from that anticipated by any forward-looking statements. Forward-looking statements speak only as of the date they are made, and the company undertakes no obligation to update or revise any forward-looking statement. Other important assumptions and factors that could cause actual results to differ materially from those in the forward-looking statements are detailed in the company's filings with the Securities and Exchange Commission (the "SEC"), which are accessible on the SEC's website at www.sec.gov and the company's website at www.eastman.com.

Non-GAAP financial measures

All earnings and cash flow measures referenced in these presentations are non-GAAP and exclude certain items. Reconciliations to the most directly comparable GAAP financial measures and other associated disclosures, including a description of the non-GAAP measures and the excluded and adjusted non-core, unusual, and other items, are available in the Appendix at the end of this presentation and in the "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of the Forms 10-K and 10-Q filed with the SEC for the periods for which non-GAAP financial measures are presented available on our website at https://www.eastman.com/Company/investors/Financial_Information/Pages/SEC_Information.aspx. The projected Earnings Before Interest, Taxes, Depreciation, and Amortization ("EBITDA") exclude any non-core, unusual, or nonrecurring items. Our financial results forecasts do not include non-core items (such as mark-to-market pension and other postretirement benefit gain or loss, and asset impairments and restructuring charges) or any unusual or non-recurring items because we are unable to predict with reasonable certainty the financial impact of such items. These items are uncertain and depend on various factors, and we are unable to reconcile projected EBITDA excluding non-core and any unusual or non-recurring items to reported GAAP net earnings without unreasonable efforts.

Glossary of terms and acronyms

Refer to the Appendix at the end of this presentation for a glossary of terms and acronyms used in this presentation. Unless otherwise indicated, except for earnings per share, all

dollar amounts are millions "($M)" or billions "($B)"

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Today's agenda and presenters

Presentations

10:20 a.m.

Strategy overview

Mark Costa

10:40 a.m.

Polyester platform update

Brad Lich

Scott Ballard

Dr. Chris Killian

11:35 a.m.

Cellulosic biopolymer platform update

Travis Smith

Erwin Dijkman

11:55 a.m.

Financial update

Willie McLain

12:05 p.m.

Q&A

All speakers

Lunch

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Solid progress executing our strategy since 2021

Innovation-driven

Circular economy is our

Strengthening

Sustainability and ESG

Power of cash flow and

growth model is

vector of significant

execution to convert

are integrated into

the balance sheet ​

succeeding

growth

growth to value​

how we win​

Significant mix upgrade

Solidified leadership

Continued investment in

Made strong progress

Delivered resilient earnings

driven by innovation

position in circular

our capabilities and culture

reducing our carbon

and cash flow and

during recent weak

economy with

to deliver growth ​

footprint and remain on

demonstrated disciplined

macroeconomic

construction of world's

track for our 2030 goals

portfolio management

environment

largest material-to-

with the exit of

material molecular

underperforming and non-

recycling facility

core product lines

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Our innovation-driven growth strategy is working

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We have remained committed

to our strategy throughout this period of weak demand

Capital deployment

Capabilities

Results

Investing in organic growth

during weak parts of the economic cycle

$800

$600

$400

$200

$-

2019 2020 2021 2022 2023 2024F

Maintenance CapEx ($M)

Growth CapEx ($M)

Maintaining our world-class technology

Creating value in the core through

organization with aggressive external hiring

structural mix improvement

Head count

20192024F

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Eastman is leveraged to an economic recovery, especially in discretionary markets

ISM manufacturing PMI has been contracting for the longest time since the 1980s

Current downturn: 23 of last 24 months below 50

50

COVID:

10 months below 50

2019

2020

2021

2022

2023

2024

Eastman's discretionary markets1 are still below 2019 levels2

100

2019

2020

2021

2022

2023

2024F

End-market demand

Eastman's specialty vol/mix

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1.

LMC automotive global light vehicle production; National Association of Realtors U.S. Existing Home Sales; IHS Domestic appliances and

plastic products, U.S. and Western Europe​

2.

Auto, building and construction, and consumer durables indexed to 2019 and weighted based on Eastman revenue footprint

Eastman's diverse portfolio and mix improvement through innovation have enabled strong performance relative to peers

Resilient adjusted EBITDA margins during a period of substantial inflation1

Consistent EPS performance in volatile environment

24%

22%

20%

18%

16%

14%

12%

2019

2020

2021

2022

2023

2024E

Commodity peers

Specialty peers

Eastman

3%

EPS CAGR

2%

1%

-2024E

-2%

Adjusted

2019

-6%

-10%

-9%

Commodity peers

Eastman

Specialty peers

Strong conversion of EBITDA to cash flow to fund growth

100%

Operating cash flow as a %

adjusted EBITDA 2019-2024E

75%

72%

73%

62%

50%

25%

0%

of

Specialty peers

Eastman

Commodity peers

Delivering superior Total Shareholder Returns over a 5-year2 period

60%

51%

50%

40%

30%

20%

19%

12%

10%

Commodity peers

Specialty peers

Eastman

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1.

All 2024E figures on this slide are NASDAQ sell-side equity analyst mean estimates as of market

close November 15, 2024

2.

5-year Total Shareholder Return ended November 15, 2024

Before circular investments, base business expected

to recover to >$2.1B of EBITDA in a normalized environment

>$2.1B

>$1.75B

Specialty vol/mix

CI returning

Operational

2024E

Fibers

Normalized

EBITDA

recovering to

to mid-cycle

moderation

excellence and

EBITDA

2019 levels

cost discipline

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Disclaimer

Eastman Chemical Company published this content on November 21, 2024, and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on November 21, 2024 at 15:38:07.646.