6-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 6-K

 

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO SECTION 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of March 2021

Commission File Number: 001-40007

 

 

Atotech Limited

(Translation of registrant’s name into English)

 

 

William Street, West Bromwich

West Midlands, B70 0BG

United Kingdom

(Address of principal executive office)

 

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F  ☒             Form 40-F  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):  ☐

 

 

 


On March 4, 2021, Atotech Limited issued a press release announcing its financial and operating results for the fourth quarter and year ended December 31, 2020. A copy of the press release and accompanying earnings presentation are furnished as Exhibits 99.1 and 99.2 hereto.

Exhibits

 

Exhibit
Number

  

Description

99.1    Press Release, dated March 4, 2021, issued by Atotech Limited.
99.2    Atotech Limited Earnings Presentation, dated March 4, 2021.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: March 4, 2021

 

Atotech Limited
By:  

/s/ Peter Frauenknecht

Name:   Peter Frauenknecht
Title:   Chief Financial Officer
EX-99.1

Exhibit 99.1

FOR IMMEDIATE RELEASE

 

LOGO

Atotech Reports Fourth Quarter and Full Year 2020 Results and Provides 2021 Full Year Guidance

 

   

Reports fourth quarter revenue of $365 million, an increase of 18% over the fourth quarter of 2019, including organic chemistry revenue growth of 5%

 

   

Delivers net income of $22 million, up significantly over the fourth quarter of 2019

 

   

Posts adjusted EBITDA of $106 million, a 5% increase over the fourth quarter of 2019

 

   

Reduces net leverage to 5.1x at year end 2020 (before IPO completion on February 8, 2021)

 

   

Expects total full year 2021 organic revenue growth to be in the range of 10% to 12%, including full year organic chemistry revenue growth in the range of 8% to 9%

 

   

Anticipates full year 2021 adjusted EBITDA1 to be in the range of $405 million to $425 million, an increase of approximately 14%, at the mid-point

BERLIN, Germany - March 4, 2021 – Atotech (NYSE: ATC), a leading specialty chemicals technology company and a market leader in advanced electroplating solutions, today reported its financial results for the fourth quarter and full year 2020 and provided guidance for full year 2021. Total organic chemistry revenue growth, a key performance indicator for the company, increased 5% over the fourth quarter of 2019. Organic chemistry revenue growth reflects chemistry revenue growth excluding the impact of foreign exchange translation (“FX”) and palladium pass-through (“palladium”).

Management Commentary

Geoff Wild, Atotech’s Chief Executive Officer said, “We are very pleased with our fourth quarter performance. We leveraged the continued strength of our Electronics end-markets, as well as the ongoing recovery in global automotive markets, to deliver strong organic growth. In particular, demand for our comprehensive solutions addressing the technical requirements related to the 5G smartphone replacement cycle, including next-generation semiconductor packaging, was robust. Other areas of strength include 5G infrastructure, automotive electrification, and growing demand for sustainable solutions in surface-finishing applications.”

“These secular trends not only provided a constructive backdrop in the fourth quarter, but also present a multi-year opportunity to grow our business, expand share, and deliver strong returns to our shareholders.”

 

1 

Adjusted EBITDA is a non-IFRS financial measure. Adjusted EBITDA should be considered in addition to, but not as a substitute for, the information provided in accordance with IFRS. A reconciliation for adjusted EBITDA to the most directly comparable IFRS financial measure is provided in the Reconciliation of Adjusted EBITDA to Consolidated Net Income (Loss) table. We are not able to forecast Consolidated net income (loss) on a forward-looking basis without unreasonable efforts due to the high variability and difficulty in predicting certain items that affect Consolidated net income (loss), including, but not limited to, Income taxes, Interest expense, net, and Foreign exchange income (loss).


“Throughout 2020, we continued to invest in our business and made decisions in the long-term best interests of our customers, while carefully managing costs.”

“We completed a new chemistry manufacturing facility in China, invested in multiple digitalization initiatives, including IoT solutions, and maintained our highly trained customer-facing workforce. As we enter this high-growth period in our industry, we believe these decisions have positioned Atotech to take advantage of the many market opportunities in front of us.”

Fourth Quarter 2020 Results

Reported total revenue was $365 million for the fourth quarter, an increase of 18% over the prior year period. Organic revenue for both chemistry and equipment, which reflects total revenue excluding the impact of FX and palladium, increased 9%. FX was a 4% tailwind and palladium increased total revenue by 5% in the quarter. These strong quarterly results were driven by organic chemistry revenue growth of 5%, reflecting increases in both the Electronics (“EL”) and General Metal Finishing (“GMF”) segments.

Adjusted EBITDA was $106 million for the fourth quarter, a 5% increase over the prior year period, reflecting strong organic chemistry volume growth, stable pricing, and the benefits of cost containment actions, partially offset by compensation accruals taken in the fourth quarter.

Adjusted EBITDA margin was 29.1% in the fourth quarter of 2020, which reflects the impact of palladium pass-through, the product mix of chemistry versus equipment, as well as the impact of compensation accruals. Excluding these items, adjusted EBITDA margin was largely in-line with the fourth quarter of 2019.

Strong cash flow generation enabled the company to repay $80 million of its outstanding Holdco notes in the fourth quarter of 2020 and thereby reduce its net leverage to 5.1x full year adjusted EBITDA at year end, and before the proceeds from the company’s IPO, which closed in early February. Pro forma for the application of proceeds from the company’s IPO, net leverage is 3.9x full year adjusted EBITDA at year end.

Fourth Quarter 2020 Segment Highlights

Electronics: Revenue for the fourth quarter in our Electronics segment of $232 million increased 25% over the prior year period. Total organic Electronics revenue increased 14%, consisting of 7% organic chemistry growth and a 56% increase in organic equipment revenue. Palladium and FX were each a 5% tailwind in the quarter.

The organic Electronics revenue increase was driven by strong demand for the company’s leading IC substrates and advanced semiconductor packaging solutions. This demand is being driven by secular trends in 5G infrastructure and smartphone growth, as well as growth in leading-edge consumer electronics, including wearables. These trends are also driving strong demand for our equipment, as our customers actively upgrade to next-generation packaging standards and increase production capacity.

Adjusted EBITDA for our Electronics segment was $70 million in the fourth quarter, an increase of 9% over the prior year period, primarily reflecting strong chemistry volume growth.

General Metal Finishing: Revenue for the fourth quarter in our GMF segment of $133 million increased 7% over the prior year period. Total organic GMF revenue increased 2%, consisting of 3% organic chemistry revenue growth, partially offset by a decline in organic equipment revenue. Palladium and FX added 3% and 2% to revenue in the quarter, respectively.


Organic chemistry revenue growth was primarily driven by the continued global automotive market recovery and solid demand in other industrial end-markets.

Adjusted EBITDA for our GMF segment was $36 million, essentially flat with last year.

Initial Public Offering

Subsequent to year end 2020, the company closed its initial public offering of 29,268,000 shares of common stock at $17.00 per share on February 8, 2021. The gross proceeds to Atotech from the offering were approximately $498 million, before deducting the underwriting discount and offering expenses, and were used to further repay indebtedness and to pay underwriting discounts and offering expenses.

Full Year 2021 Guidance

Regarding the company’s 2021 outlook, Peter Frauenknecht, Atotech’s Chief Financial Officer said, “We expect full year 2021 total organic revenue growth to be in the range of 10% to 12%, including full year organic chemistry revenue growth in the range of 8% to 9%, which excludes the impact of FX and palladium pass-through. This strong outlook is driven by constructive end-markets in both our Electronics and GMF segments. We expect to leverage this organic growth and deliver full year 2021 adjusted EBITDA in the range of $405 million to $425 million, which represents an increase of 14% over 2020, at the mid-point.”

Conference Call

The company will host a conference call today at 8:00 a.m. Eastern time to discuss these results. To participate on the conference call, please dial +1 833-714-3263 (United States) or +1 270-823-1866 (international), using conference ID 3943049. A link to the live audio webcast, and associated materials, will also be available on the company website at investors.atotech.com.

Cautionary Statement Regarding Forward-Looking Statements

This communication contains “forward-looking statements” within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In this context, forward-looking statements often address expected future business and financial performance and financial condition, and often contain words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “see,” “will,” “would,” “target,” and similar expressions and variations or negatives of these words.

These forward-looking statements, which are subject to risks, uncertainties, and assumptions about us, may include projections of our future financial performance, our anticipated growth strategies, and anticipated trends in our business. These statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements, and such differences could be material. We undertake no obligation to publicly update or revise any forward-looking statements to reflect subsequent events or circumstances.


More information on potential factors that could affect Atotech’s financial results is available in “Forward-Looking Statements”, the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” within Atotech’s most recent Annual Report on Form 20-F, and in other documents that we have filed with, or furnished to, the U.S. Securities and Exchange Commission, and such factors include, but are not limited to: the uncertainty of the magnitude, duration, geographic reach, impact on the global economy of the COVID 19 pandemic, as well as the current and potential travel restrictions, stay at home orders, and other economic restrictions implemented to address it; uncertainty, downturns, and changes in our target markets; foreign currency exchange rate fluctuations; reduced market acceptance and inability to keep pace with evolving technology and trends; loss of customers; increases in costs or reductions in the supplies of raw materials that may materially adversely affect our business, financial condition, and results of operations; our ability to provide products and services in light of changing environmental, health and safety, product liability, financial, and other legislation and regulation; our failure to compete successfully in product development; our ability to successfully execute our growth initiatives, business strategies, and operating plans; whether the secular trends we expect to drive growth in our business materialize to the degree we expect them to, or at all; material costs relating to environmental and health and safety requirements or liabilities; underfunded defined benefit pension plans; risk that the insurance we maintain may not fully cover all potential exposures; failure to comply with the anti-corruption laws of the United States and various international jurisdictions; tariffs, border adjustment taxes, or other adverse trade restrictions and impacts on our customers’ value chains; political, economic, and legal uncertainties in China, the Chinese government’s control of currency conversion and expatriation of funds, and the Chinese government’s policy on foreign investment in China; regulations around the production and use of chemical substances that affect our products; the United Kingdom’s withdrawal from the European Union; weak intellectual property rights in jurisdictions outside the United States; intellectual property infringement and product liability claims; our substantial indebtedness; our ability to obtain additional capital on commercially reasonable terms may be limited; risks related to our derivative instruments; our ability to attract, motivate, and retain senior management and qualified employees; increased risks to our global operations including, but not limited to, political instability, acts of terrorism, taxation, and unexpected regulatory and economic sanctions changes, among other things; natural disasters that may materially adversely affect our business, financial condition, and results of operations; the inherently hazardous nature of chemical manufacturing that could result in accidents that disrupt our operations and expose us to losses or liabilities; damage to our brand reputation; Carlyle’s ability to control our common shares; any statements of belief and any statements of assumptions underlying any of the foregoing; and other factors beyond our control.

Non-IFRS Financial Measures

This communication contains certain non-IFRS financial measures designed to complement the financial information presented in accordance with IFRS because management believes such measures are useful to investors. However, our use of these non-IFRS financial measures may vary from that of others in our industry. Our non-IFRS metrics have limitations as analytical tools, and you should not consider them in isolation or as alternatives to consolidated net income (loss) or other performance measures derived in accordance with IFRS as measures of operating performance, operating cash flows or liquidity. The Company believes that these measures are important and supplement discussions and analysis of its results of operations and enhances an understanding of its operating performance. See the Appendix for a reconciliation of the non-IFRS financial measures.


About Atotech

Atotech is a leading specialty chemicals technology company and a market leader in advanced electroplating solutions. Atotech delivers chemistry, equipment, software, and services for innovative technology applications through an integrated systems-and-solutions approach. Atotech solutions are used in a wide variety of end-markets, including smartphones and other consumer electronics, communications infrastructure, and computing, as well as in numerous industrial and consumer applications such as automotive, heavy machinery, and household appliances.

Atotech, headquartered in Berlin, Germany, is a team of 4,000 experts in over 40 countries generating annual revenues of $1.2 billion (2020). Atotech has manufacturing operations across Europe, the Americas, and Asia. With its well-established innovative strength and industry-leading global TechCenter network, Atotech delivers pioneering solutions combined with unparalleled on-site support for over 9,000 customers worldwide. For more information about Atotech, please visit us at atotech.com.

Contacts:

Paul Goldberg

+1 803 504 4731

paul.goldberg@atotech.com

Susanne Richter

+49 30 349 85 418

press@atotech.com


Financial Statement Tables

ATOTECH LIMITED

Income Statement

 

     Three months ended
(unaudited)
    Year ended
(audited)
 
($ in millions), except earnings per share    Dec. 31,
2020
    Dec. 31,
2019
    Dec. 31,
2020
    Dec. 31,
2019
 

Revenue

   $ 365.4     $ 310.4     $  1,234.3     $  1,187.8  

Cost of sales, excluding depreciation and amortization

     (173.8     (128.0     (558.0     (488.2

Depreciation and amortization

     (45.4     (48.2     (450.3     (170.1

Selling, general and administrative expenses

     (72.1     (71.9     (270.2     (277.1

Research and development expenses

     (17.6     (11.3     (54.4     (51.2

Restructuring benefit (expenses)

     (0.7     0.4       (2.5     (13.4

Operating profit (loss)

     55.8       51.3       (101.2     187.8  

Interest expense

     (36.4     (35.3     (144.5     (148.9

Other income (expense), net

     23.4       (3.5     20.6       23.5  

Income (loss) before income taxes

     42.8       12.5       (225.1     62.4  

Income tax expense

     (20.4     (16.8     (64.3     (54.8

Consolidated net income (loss)

   $ 22.4     $ (4.3   $ (289.4   $ 7.6  

Earnings per share(a)

        

Basic earnings (loss) per share

     (0.12     (0.38     (4.64     (1.23

Diluted earnings (loss) per share

     (0.12     (0.38     (4.64     (1.23

 

(a)

Reflects interest accrued on preference shares. Please refer to Note 6 in our audited financial statements included in our Annual Report on Form 20-F.

 

     Three months ended
(unaudited)
    Year ended
(audited)
 
($ in millions)    Dec. 31,
2020
    Dec. 31,
2019
    Dec. 31,
2020
    Dec. 31,
2019
 

Consolidated net income (loss)

   $ 22.4     $  (4.3   $  (289.4   $ 7.6  

Other comprehensive income (loss)

        

Actuarial gains and losses

     10.0       (7.7     (3.8     (23.0

Tax effect

     (3.0     2.2       1.1       6.8  

Items not potentially reclassifiable to statement of income

     7.0       (5.4     (2.8     (16.1

Currency translation adjustment

     92.1       65.5       114.9       (20.6

Hedge reserve

     (10.5     (9.8     (13.4     (2.7

Other

     1.5       (0.5     1.5       (0.5

Items potentially reclassifiable to statement of income (loss), net of tax

     83.1       55.1       103.0       (23.9

Total other comprehensive income (loss), net amount

   $ 90.2     $  49.7     $ 100.2     $  (40.0

Comprehensive loss

   $  112.5     $ 45.3     $  (189.2   $  (32.4


ATOTECH LIMITED

Condensed Consolidated Balance Sheets

 

     As of
(audited)
 
($ in millions)    Dec. 31, 2020      Dec. 31, 2019  

Assets

     

Non-current assets

     

Property, plant and equipment

   $ 359.4      $ 366.4  

Intangible assets

     1,471.0        1,460.8  

Goodwill

     804.1        1,046.4  

Right-of-use assets

     104.1        99.2  

Other financial assets

     70.3        42.0  

Other non-financial assets

     2.7        4.0  
  

 

 

    

 

 

 

Total non-current assets

     2,811.6        3,018.9  
  

 

 

    

 

 

 

Current assets

     

Inventories

     145.4        124.7  

Trade receivables*

     262.0        245.6  

Other financial assets*

     24.9        20.7  

Other non-financial assets*

     24.1        19.0  

Tax assets

     46.4        34.2  

Cash and cash equivalents

     320.1        302.7  

Total current assets

     822.9        747.0  
  

 

 

    

 

 

 

Total assets

   $  3,634.5      $  3,765.8  
  

 

 

    

 

 

 

Liabilities & shareholders’ equity

     

Shareholders’ equity

     

Common shares and preferred shares

     102.1        102.1  

Paid-in surplus and retained earnings

     261.6        550.7  

Currency translation adjustment and other reserves

     120.0        19.8  
  

 

 

    

 

 

 

Total shareholders’ equity

     483.7        672.5  
  

 

 

    

 

 

 

Non-current liabilities

     

Borrowings

   $ 2,065.7      $ 2,115.0  

Deferred tax liabilities

     340.8        340.1  

Employee benefits

     176.2        156.1  

Provisions

     13.2        22.2  

Lease liabilities

     67.7        64.0  

Other financial liabilities

     1.5        2.6  
  

 

 

    

 

 

 

Total non-current liabilities

     2,665.1        2,700.1  
  

 

 

    

 

 

 

Current liabilities

     

Borrowings

     0.5        0.8  

Trade payables*

     221.0        176.3  

Tax liabilities

     99.2        77.7  

Lease liabilities

     13.8        11.1  

Other financial liabilities*

     38.5        31.5  

Other non-financial liabilities*

     89.7        73.3  

Provisions

     23.0        22.5  
  

 

 

    

 

 

 

Total current liabilities

     485.8        393.2  
  

 

 

    

 

 

 

Total liabilities & shareholders’ equity

   $ 3,634.5      $ 3,765.8  
  

 

 

    

 

 

 

 

*

For reasons of materiality, the new balance sheet items “Other non-financial assets” and “Other non-financial liabilities” were created, which also led to reclassifications of transactions from other financial positions. Please refer to Note 2.1.2 in our audited financial statements included in our Annual Report on Form 20-F.


ATOTECH LIMITED

Consolidated Statement of Cash Flows

 

     Three months ended
(unaudited)
    Year ended
(audited)
 
($ in millions)    Dec. 31,
2020
    Dec. 31,
2019
    Dec. 31,
2020
    Dec. 31,
2019
 

Operating activities

        

Consolidated net income (loss)

   $ 22.4     $ (4.3   $  (289.4   $ 7.6  

Adjustments to reconcile net income (loss) to cash provided by operating activities:

        

Depreciation and amortization

     45.4       48.2       450.3       170.1  

Income taxes and changes in non-current provisions

     19.8       13.2       55.1       58.4  

(Gains)/losses on disposals of assets

     0.6       0.6       1.5       (5.2

Net (gain)/loss on financial instruments at fair value

     (34.8     (10.4     (36.8     (35.9

Accrued financial interest costs

     33.6       31.8       128.9       132.7  

Amortization of deferred financing cost, including original issuance discounts

     2.8       3.6       15.6       16.4  

Interest paid

     (31.5     (32.0     (126.9     (133.0

Taxes paid

     (21.8     (21.2     (70.6     (84.8

Other

     (0.0     (1.5     (0.1     (1.3

(Increase)/decrease in inventories

     4.5       7.1       (10.8     (3.1

(Increase)/decrease in trade receivables

     (9.8     (0.0     (9.1     (5.7

Increase/(decrease) in trade payables

     55.3       42.1       40.7       48.9  

Changes in other assets and liabilities

     10.8       (8.5     12.5       (30.4
  

 

 

   

 

 

   

 

 

   

 

 

 

Cash flow provided by operating activities

     97.2       68.7       160.6       134.8  
  

 

 

   

 

 

   

 

 

   

 

 

 

Investing activities

        

Acquisition of subsidiaries, net of cash acquired

     0.0       0.0       (2.7     (4.5

Intangible assets and property, plant and equipment additions

     (14.4     (27.5     (52.8     (75.7

Increase in non-current loans

     (0.0     0.0       (0.1     (0.1

Proceeds from disposals of intangible assets and property, plant and equipment

     0.1       2.8       0.2       9.7  

Repayments of non-current loans

     (0.1     0.1       0.3       0.3  
  

 

 

   

 

 

   

 

 

   

 

 

 

Cash flow used in investing activities

     (14.4     (24.6     (55.0     (70.3
  

 

 

   

 

 

   

 

 

   

 

 

 

Financing activities

        

Issuance of non-current debt

     0.1       —         175.1       —    

Repayment of non-current debt

     (68.2     (4.0     (255.2     (115.8

Increase (decrease) in current borrowings and bank debt

     (15.8     4.4       (17.4     (2.0

Increase (decrease) in current financial assets and liabilities

     0.5       (1.0     0.0       (1.1

Payment of lease liabilities

     (4.0     (4.4     (15.3     (15.9

Payment of deferred finance costs

     (0.0     0.1       (9.2     (9.9

Cash flow used in financing activities

     (87.5     (5.0     (122.0     (144.6
  

 

 

   

 

 

   

 

 

   

 

 

 

Net decrease in cash and cash equivalents

     (4.7     39.1       (16.4     (80.1
  

 

 

   

 

 

   

 

 

   

 

 

 

Effect of exchange rates

     24.3       16.5       33.7       (3.4

Cash and cash equivalents at the beginning of the period

     300.4       247.2       302.7       386.2  
  

 

 

   

 

 

   

 

 

   

 

 

 

Cash and cash equivalents at the end of the period

   $  320.1     $  302.7     $ 320.1     $ 302.7  
  

 

 

   

 

 

   

 

 

   

 

 

 

 

*

For reasons of materiality, the new balance sheet items “Other non-financial assets” and “Other non-financial liabilities” were created, which also led to reclassifications of transactions from other financial positions. Please refer to Note 2.1.2 in our audited financial statements included in our Annual Report on Form 20-F.


ATOTECH LIMITED

Revenue Data

 

     Three months ended
(unaudited)
     Year ended
(audited)
 
($ in millions)    Dec. 31, 2020      Dec. 31, 2019      Dec. 31, 2020      Dec. 31, 2019  

Type of goods or service

           

Chemistry revenue

   $  318.1      $  278.9      $  1,114.0      $  1,065.5  

Equipment revenue

     47.3        31.5        120.3        122.3  
  

 

 

    

 

 

    

 

 

    

 

 

 

Total revenue from contracts with customers

     365.4        310.4        1,234.3        1,187.8  
  

 

 

    

 

 

    

 

 

    

 

 

 

Geographical market

           

Asia

     272.6        214.3        897.8        808.4  

Europe

     63.8        65.0        232.2        254.2  

Americas

     29.0        31.1        104.3        125.2  
  

 

 

    

 

 

    

 

 

    

 

 

 

Total revenue from contracts with customers

   $ 365.4      $ 310.4      $ 1,234.3      $ 1,187.8  
  

 

 

    

 

 

    

 

 

    

 

 

 


ATOTECH LIMITED

Segment Data

 

    Three months ended
(unaudited)
    Year ended
(audited)
 
    Dec. 31, 2020     Dec. 31, 2019     Dec. 31 2020     Dec. 31 2019  
($ in millions)   EL     GMF     Total     EL     GMF     Total     EL     GMF     Total     EL     GMF     Total  

Revenue

  $ 232.4     $ 133.0     $ 365.4     $ 186.2     $ 124.2     $ 310.4     $ 797.7     $ 436.6     $ 1,234.3     $ 682.9     $ 504.9     $ 1,187.8  

thereof Chemistry revenue

    188.8       129.3       318.1       159.2       119.6       278.9       690.0       424.0       1,114.0       596.2       469.3       1,065.5  

thereof Equipment revenue

    43.6       3.7       47.3       26.9       4.6       31.5       107.7       12.6       120.3       86.7       35.6       122.3  

Segment Adjusted EBITDA

    70.3       36.0       106.3       64.4       36.4       100.8       259.0       104.9       363.9       241.6       138.5       380.1  

ATOTECH LIMITED

Reconciliation of Adjusted EBITDA to Consolidated Net Income (Loss)

 

     Three months ended
(unaudited)
    Year ended
(audited)
 
($ in millions)    Dec. 31,
2020
    Dec. 31,
2019
    Dec. 31,
2020
    Dec. 31,
2019
 

Consolidated net income (loss)

   $ 22.4     $ (4.3   $  (289.4   $ 7.6  

Interest expense, net

     36.4       35.0       142.0       148.1  

Income taxes

     20.4       16.9       64.3       54.8  

Depreciation and amortization (excluding impairment charges)

     43.3       42.3       166.4       165.4  

EBITDA

     122.5       89.8       83.3       375.9  

Gain on disposal of fixed assets(a)

     —         —         —         (6.1

Non-cash adjustments(b)

     (32.2     (3.4     250.7       (10.2

Foreign exchange loss(c)

     11.6       12.0       14.8       (2.4

Restructuring(d)

     0.7       (0.3     2.5       13.4  

Transaction related costs(e)

     2.8       2.2       7.6       7.1  

Management fee(f)

     0.4       0.5       2.7       2.4  

COVID-19 adjustment(g)

     0.4       —         2.2       —    

Adjusted EBITDA

   $  106.3     $ 100.8     $ 363.9     $  380.1  
  

 

 

   

 

 

   

 

 

   

 

 

 

thereof EL Segment Adjusted EBITDA

   $ 70.3     $ 64.4     $ 259.0     $ 241.6  
  

 

 

   

 

 

   

 

 

   

 

 

 

thereof GMF Segment Adjusted EBITDA

     36.0       36.4       104.9       138.5  
  

 

 

   

 

 

   

 

 

   

 

 

 

 

(a)

Eliminates the cash impact of gains on the sale of fixed assets.

(b)

Eliminates the non-cash impact of (1) share based compensation, (2) losses on the sale of fixed assets, (3) impairment charges including, for the year ended December 31, 2020, as a result of the negative impact that the COVID 19 pandemic had on demand for products and services and the resulting impairment testing of GMF goodwill, which resulted in an impairment charge of $279.5 million, and (4) mark to market adjustments related to our foreign currency derivatives entered into in connection with certain redenomination transactions not linked to underlying individual transactions and bifurcated embedded derivatives related to certain redemption features of the 6.250% Senior Notes due 2025 and 8.75%/9.50% Senior PIK Toggle Notes. The dollar value of these non-cash adjustments for each period presented above is set forth below:

 

     Three months ended
(unaudited)
    Year ended
(audited)
 
($ in millions)    Dec. 31,
2020
    Dec. 31,
2019
    Dec. 31,
2020
    Dec. 31,
2019
 

Share based compensation

   $ 0.1     $ 0.1     $ 0.3     $ 0.2  

Losses on the sale of fixed assets

     0.6       0.6       1.5       0.9  

Impairment charges

     2.0       5.8       283.9       4.7  

Mark-to-market adjustments

     (34.8     (10.0     (35.0     (16.0

Non-cash adjustments

   $  (32.2   $  (3.4   $  250.7     $  (10.2

 

(c)

Eliminates net foreign currency transactional gains and losses on balance sheet items.


(d)

Eliminates charges resulting from restructuring activities principally from the Company’s cost reduction efforts.

(e)

Reflects an adjustment to eliminate (1) fees associated with the foreign currency exchange derivatives entered into in conjunction with the Acquisition, (2) professional fees paid to third party advisors in connection with the implementation of strategic initiatives and (3) IPO related costs, linked to the existing equity.

(f)

Reflects an adjustment to eliminate fees paid to Carlyle. The consulting agreement pursuant to which management fees are paid to Carlyle will terminate on the earlier of (i) the second anniversary of the initial public offering and (ii) the date upon which Carlyle ceases to own more than ten percent of the outstanding voting securities of the Company. Management does not view these fees as indicative of the Company’s operational performance and the removal of these fees from Adjusted EBITDA is consistent with the calculation of similar measures under our senior secured credit facilities.

(g)

Eliminates charges in connection with COVID-19, including $1.7 million for masks, sanitizers, and other COVID-19 related expenses at certain plant and office locations and $0.5 million of expenses incurred during locally mandated plant shutdowns in China, Malaysia, India, and Mexico.

ATOTECH LIMITED

Organic Revenue Growth Reconciliation

 

     Three months ended December 31, 2020
(unaudited)
    Year ended December 31, 2020
(audited)
 
     Reported
Revenue
Growth
    Impact
of
Currency
    Palladium
Pass-
Through
    Organic
Growth
    Reported
Revenue
Growth
    Impact
of
Currency
    Palladium
Pass-
Through
    Organic
Growth
 

Electronics

     25     (5 %)      (5 %)      14     17     (1 %)      (9 %)      7

General Metal Finishing

     7     (2 %)      (3 %)      2     (14 )%      1     (3 %)      (16 )% 
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

     18     (4 %)      (5 %)      9     4     —         (6 %)      (2 )% 
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
EX-99.2

Slide 1

Atotech Q4 2020 Conference Call March 4, 2021 Geoff Wild Chief Executive Officer Peter Frauenknecht Chief Financial Officer Exhibit 99.2


Slide 2

Forward-Looking Statements This presentation and the oral remarks made in connection herewith may contain “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Any forward-looking statements involve risks, uncertainties and assumptions. Although we believe that the assumptions and analysis underlying these statements are reasonable as of the date hereof, investors are cautioned not to place undue reliance on these statements. Forward-looking statements include information concerning our liquidity and our possible future results of operations, including descriptions of our business strategies, plans, goals, prospects, future events and the cost savings and other benefits we expect to achieve as a result of the acquisition discussed herein. These statements often include words such as “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” “target,” “project,” “forecast,” “seek,” “will,” “may,” “should,” “could,” “would,” or similar expressions. These statements are based on certain assumptions that we have made in light of our experience in the industry and our perceptions of historical trends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances as of the date hereof. We do not have any obligation to and do not intend to update any forward-looking statements included herein. You should understand that these statements are not guarantees of future performance or results. Actual results could differ materially from those described in any forward-looking statements contained herein as a result of a variety of factors, including known and unknown risks and uncertainties, many of which are beyond our control. This presentation has been prepared by Atotech Limited (“the Company”) and includes information from other sources believed by the Company to be reliable, and, while reasonable care has been taken to ensure that the facts stated herein are accurate and that the opinions and expectations contained herein are fair and reasonable, no representation or warranty, express or implied, if made as to the fairness, accuracy or completeness of any of the opinions and conclusions set forth herein based on such information. More information on potential factors that could affect the Company’s financial results is available in Item 3.D. “Risk Factors” and Item 5. “Operating and Financial Review and Prospects” sections within the Company’s most recent annual report on Form 20-F, and in other documents that we have filed with, or furnished to, the U.S. Securities and Exchange Commission. Unless otherwise indicated, the information contained herein speaks only as of the date hereof and is subject to change, completion or amendment without notice. The Company undertakes no obligation to update or revise any of the forward-looking statements contained herein, whether a result of new information, future events or otherwise. The contents of this presentation are not to be construed as legal, regulatory, business, accounting or tax advice. You should consult your own attorney, business advisor, accountant and tax advisor as to legal, regulatory, business, accounting and tax advice. Under no circumstances is this presentation or the information contained herein to be construed as a prospectus, offering memorandum or advertisement, and neither any part of this presentation nor any information or statement contained herein shall form the basis of or be relied upon in connection with any contract or commitment whatsoever. This presentation is not, and is not intended to be, an offer to sell, or a solicitation of an offer to purchase, any securities or any other interest in the Company. This presentation has been prepared by the Company solely for informational purposes and exclusively for the benefit and internal confidential use of the recipient. The Company and its affiliates, officers, directors, employees, professional advisors and agents do not accept responsibility or liability for this presentation or its contents (except to the extent that such liability cannot be excluded by law). Non-IFRS Financial Measures The historical financial information included herein includes financial information that is not presented in accordance with International Financial Reporting Standards and related interpretations as issued by the IASB and adopted by the European Union (“IFRS”), including EBITDA and Adjusted EBITDA. We believe EBITDA and Adjusted EBITDA are measures commonly used by analysts and investors to evaluate the performance of companies in our industry. Our use of the terms EBITDA and Adjusted EBITDA may differ from that of others in our industry. EBITDA and Adjusted EBITDA should not be considered as alternatives to net income (loss), operating income or any other performance measures derived in accordance with IFRS as measures of operating performance or operating cash flows or as measures of liquidity. EBITDA and Adjusted EBITDA have important limitations as analytical tools and should be considered in conjunction with, and not as substitutes for, our results as reported under IFRS. This presentation includes a reconciliation of certain non-IFRS financial measures with the most directly comparable financial measures calculated in accordance with IFRS. Rounding Certain monetary amounts, percentages and other figures included in this presentation have been subject to rounding adjustments. Accordingly, figures shown as totals in certain tables may not be the arithmetic aggregation of the figures that precede them, and figures expressed as percentages in the text may not total 100% or, as applicable, when aggregated may not be the arithmetic aggregation of the percentages that precede them. Organic Sales Organic sales growth is calculated as net revenue growth excluding the impact of foreign exchange and palladium price fluctuations. Defined Terms All capitalized terms contained within this presentation have been previously defined in our filings with the U.S. Securities and Exchange Commission. Legal Disclaimer


Slide 3

Q4 Highlights Strong performance driven by favorable market conditions and solid execution Demand Environment Key Initiatives Profitability & Cash flow Adj. EBITDA(2) increased to $106M, driven by strong organic volume and cost management initiatives Adj. free cash flow from operations(2) before debt service of $120M, up 15% Net leverage at 5.1x at year-end 2020 (pre-IPO) Completed new Yangzhou chemistry production facility Drove strong growth with advanced solutions for next-generation semiconductor packaging Successful Electronics equipment product introductions Broad-based constructive end-markets Electronics organic chemistry growth of 7%(1) driven by multiple secular tailwinds (5G, smartphone replacement cycle, auto electrification) Auto markets rapidly improving, GMF organic chemistry revenue up 3%(1) Organic chemistry sales: Net chemistry sales +/- impact of FX and +/- impact of palladium See appendix for definitions of EBITDA and Adjusted EBITDA as well as a reconciliation to the most closely comparable IFRS measure


Slide 4

Consolidated Results – Q4 2020 12 Pd 29 310 365 Organic growth reflects continued strength in Electronics and improving global automotive and industrial markets in GMF; Organic chemistry revenue growth of 5% Adjusted EBITDA growth driven by strong organic volume, stable pricing, and the benefit of cost measures, partially offset by increased compensation accruals Adjusted EBITDA margin impacted by palladium pass-through, product mix and compensation accrual; excluding these items, adjusted EBITDA margin was largely in-line with last year 9% 4% 5% Organic sales: Net sales +/- impact of FX and +/- impact of palladium See appendix for definitions of EBITDA and Adjusted EBITDA as well as a reconciliation to the most closely comparable IFRS measure Consolidated results Revenue bridge $ in millions Q4 % Change 2020 2019 Total Organic(1) Electronics $232.4 $186.2 0.25 0.14000000000000001 GMF $133 $124.2 7.0000000000000007E-2 0.02 Net Revenue $365.4 $310.39999999999998 0.18 0.09 Electronics $70.3 $64.400000000000006 9.161490683229799E-2 GMF $36 $36.4 -1.098901098901095E-2 Adjusted EBITDA(2) $106.3 $100.80000000000001 5.4563492063491918E-2 Adj. EBITDA Margin 0.29099999999999998 0.32500000000000001 - 340 bps


Slide 5

Electronics Results – Q4 2020 Strong chemistry and equipment demand drive organic growth 10 Pd Q4 2020 232 186 Revenue bridge 5% 5% 14% Organic chemistry growth of 7%, driven by 5G build-out, demand for IC substrates and semiconductor packaging, and auto electrification Organic equipment revenue grew 56%, driving future incremental chemistry growth Adjusted EBITDA growth reflects organic growth, strong pricing discipline, and cost measures, partially offset by compensation accuals Margin impacted by palladium, product mix, and accruals; excluding these items, adjusted EBITDA margin was largely consistent with last year Electronics results Organic sales: Net sales +/- impact of FX and +/- impact of palladium See appendix for definitions of EBITDA and Adjusted EBITDA as well as a reconciliation to the most closely comparable IFRS measure $ in millions Q1 % Change 2020 2019 All-in Organic (1) Electronics $172.1 $149.9 0.14799999999999999 5.5% GMF 110.5 133.80000000000001 -0.17399999999999999 -0.184 Net Sales $282.60000000000002 $283.70000000000005 -0.4% -5.8% Electronics $54.7 $50.2 8.9641434262948197 Consolidated GMF 29.1 35 -0.16857142857142854 Adjusted EBITDA $83.800000000000011 $85.2 -1.6% Adj. EBITDA Margin 0.29653220099079974 0.30031723651744796 - 30 bps $ in millions Q4 % Change 2020 2019 Total Organic (1) Chemistry $188.8 $159.19999999999999 0.186 7.0999999999999994E-2 Equipment $43.6 $26.9 0.61799999999999999 0.56299999999999994 Net Revenue $232.4 $186.1 0.248 0.14199999999999999 Electronics Adj. EBITDA(2) $70.3 $64.400000000000006 9.161490683229799E-2 Adj. EBITDA Margin 0.30199999999999999 0.34599999999999997 - 440 bps $ in millions Q1 % Change 2020 2019 All-in Organic (1) Chemistry $106.7 $113.9 -6.3% -7.6% Equipment 3.9 20 -0.80600000000000005 -0.8 GMF Net Sales $110.60000000000001 $133.9 -0.17399999999999999 -0.184 Adj. EBITDA $29 $35 -0.17142857142857143 Adj. EBITDA Margin 0.26220614828209765 0.26138909634055263 + 10 bps


Slide 6

GMF Results – Q4 2020 Results reflect improving global auto markets and solid industrial activity 2 133 Pd 3% organic chemistry growth led by improving global auto markets Strong demand for sustainable solutions in automotive surface finishing and renewable energy; white goods and other industrial end-markets remain solid Equipment revenue remained muted in Q4, but order rates are slowly improving Adjusted EBITDA of $36M reflects organic volume, offset by compensation accruals Adjusted EBITDA margin impacted by palladium and accruals; excluding these items, adjusted EBITDA margin was in-line with last year GMF results Revenue bridge 2% 2% 3% Organic sales: Net sales +/- impact of FX and +/- impact of palladium See appendix for definitions of EBITDA and Adjusted EBITDA as well as a reconciliation to the most closely comparable IFRS measure $ in millions Q1 % Change 2020 2019 All-in Organic (1) Electronics $172.1 $149.9 0.14799999999999999 5.5% GMF 110.5 133.80000000000001 -0.17399999999999999 -0.184 Net Sales $282.60000000000002 $283.70000000000005 -0.4% -5.8% Electronics $54.7 $50.2 8.9641434262948197 Consolidated GMF 29.1 35 -0.16857142857142854 Adjusted EBITDA $83.800000000000011 $85.2 -1.6% Adj. EBITDA Margin 0.29653220099079974 0.30031723651744796 - 30 bps $ in millions Q1 % Change 2020 2019 All-in Organic (1) Chemistry $154.69999999999999 $129.19999999999999 0.19800000000000001 8.7% Equipment 17.399999999999999 20.7 -0.161 -0.14699999999999999 Net Sales $172.1 $149.89999999999998 0.14799999999999999 5.5% Electronics Adj. EBITDA $54.7 $50.2 8.9641434262948197 Adj. EBITDA Margin 0.31783846600813481 0.33488992661774525 - 170 bps $ in millions Q4 % Change 2020 2019 Total Organic (1) Chemistry $129.19999999999999 $119.60000000000001 8.1000000000000003E-2 2.5999999999999999E-2 Equipment $3.7 $4.5999999999999996 -0.2 -0.25700000000000001 GMF Net Revenue $132.89999999999998 $124.2 7.0999999999999994E-2 1.4999999999999999E-2 Adj. EBITDA(2) $36 $36.4 -1.098901098901095E-2 Adj. EBITDA Margin 0.27 0.29299999999999998 - 230 bps


Slide 7

Liquidity & Capital Structure Net of local lines of credit Includes revolver with commitments of $250.0M and borrowing capacity of $232.5M, after giving effect to ancillary facilities of $17.5M Reflects application of IFRS 16, Leases Capex net of proceeds from disposals of intangible assets and property, plant and equipment Q4 adj. free cash flow from operations of $120M and $262M for full year 2020, before debt service $549M of liquidity, including net cash of $316M and borrowing capacity of $232.5M(2) under RCF, provides significant cushion in all scenarios Repaid $80M of P-I-K notes in Q4 Net leverage at 5.1x at year-end driven by solid EBITDA and strong cash generation Post IPO closing (Feb 8, 2021) pro forma net leverage at 3.9x Net debt to LTM adj. EBITDA at 5.1x YE 2020 Capitalization table $ in millions Q1 % Change 2020 2019 All-in Organic (1) Electronics $172.1 $149.9 0.14799999999999999 5.5% GMF 110.5 133.80000000000001 -0.17399999999999999 -0.184 Net Sales $282.60000000000002 $283.70000000000005 -0.4% -5.8% Electronics $54.7 $50.2 8.9641434262948197 Consolidated GMF 29.1 35 -0.16857142857142854 Adjusted EBITDA $83.800000000000011 $85.2 -1.6% Adj. EBITDA Margin 0.29653220099079974 0.30031723651744796 - 30 bps $ in millions divided by LTM Amount Adj. EBITDA $ in millions Q1 % Change Cash & Cash equivalents (1) 316 2020 2019 All-in Organic (1) Chemistry $154.69999999999999 $129.19999999999999 0.19800000000000001 8.7% Revolving credit facility (2) 0 Equipment 17.399999999999999 20.7 -0.161 -0.14699999999999999 Term loans 1455 Net Sales $172.1 $149.89999999999998 0.14799999999999999 5.5% Electronics Capitalized leases (3) 81.5 Total senior secured debt 1536 4.2197802197802199 X Adj. EBITDA $54.7 $50.2 8.9641434262948197 Net senior secured debt 1220 3.3516483516483517 X Adj. EBITDA Margin 0.31783846600813481 0.33488992661774525 - 170 bps Senior unsecured notes 425 P-I-K notes 219 $ in millions Q1 % Change Total debt 2180 5.9890109890109891 X 2020 2019 All-in Organic (1) Chemistry $106.7 $113.9 -6.3% -7.6% Net debt 1864 5.1208791208791204 X Equipment 3.9 20 -0.80600000000000005 -0.8 GMF Net Sales $110.60000000000001 $133.9 -0.17399999999999999 -0.184 Common equity 484 Total capitalization 2664 Adj. EBITDA $29 $35 -0.17142857142857143 FY 2020 operating metrics Adj. EBITDA Margin 0.26220614828209765 0.26138909634055263 + 10 bps Adjusted EBITDA 364 Capital expenditures (4) 53 Cash & Cash Equivalents (1) Revolving Credit Facilities (2) Term Loans


Slide 8

Full-Year 2021 Guidance Strong growth in both segments lead to 14% adj. EBITDA growth at the mid-point Organic Chemistry Revenue Growth Adjusted EBITDA $70M - $74M(2) Interest Expense Effective Tax Rate 30% - 31%(3) 6% - 7% ~11% 8% - 9% EL: GMF: TOTAL Capex 4.5% - 5% of total revenue Total Revenue Growth (1) Includes organic chemistry growth and equipment Excludes roughly $61M in one-time costs connected with early extinguishment of Holdco and Opco notes and financing fee amortization, which will be recognized in Q1 2021 Includes approximately 25% - 26% income tax rate and 5% withholding tax rate. Tax rate is generally applicable to operating profit (before interest expense), and does not include any tax litigation reserves we may take 10% - 12% $405M - $425M


Slide 9

Appendix


Slide 10

Consolidated Results – Full-year 2020 Consolidated results Organic growth reflects continued strength in Electronics, offset by the impact of the global pandemic in GMF (particularly in Q2 2020) Adjusted EBITDA decline driven by lower GMF volume, partially offset by growth in Electronics and benefit of cost measures Adjusted EBITDA margin significantly impacted by palladium pass-through ($73 million increase in sales); excluding the impact of palladium, adjusted EBITDA margin was 31% - 6% 0% -2% Organic sales: Net sales +/- impact of FX and +/- impact of palladium See slides 12 -13 for definitions of EBITDA and Adjusted EBITDA as well as a reconciliation to the most closely comparable IFRS measure Revenue bridge $ in millions FY % Change 2020 2019 All-in Organic (1) Electronics $797.7 $682.9 0.16800000000000001 7.1999999999999995E-2 GMF $436.6 $504.9 -0.13500000000000001 -0.156 Net Revenue $1,234.3000000000002 $1,187.8 3.9E-2 -0.02 Electronics $259 $241.6 7.2019867549668895E-2 GMF $104.9 $138.5 -0.2425992779783393 Adjusted EBITDA (2) $363.9 $380.1 -4.2620363062352132E-2 Adj. EBITDA Margin 0.29499999999999998 0.32 - 250 bps


Slide 11

Electronics & GMF Results – Full-year 2020 9% 1% 7% - - -16% -1% 3% Organic sales: Net sales +/- impact of FX and +/- impact of palladium See slides 12- 13 for definitions of EBITDA and Adjusted EBITDA as well as a reconciliation to the most closely comparable IFRS measure Electronics results GMF results GMF revenue bridge Electronics revenue bridge $ in millions Q1 % Change 2020 2019 All-in Organic (1) Electronics $172.1 $149.9 0.14799999999999999 5.5% GMF 110.5 133.80000000000001 -0.17399999999999999 -0.184 Net Sales $282.60000000000002 $283.70000000000005 -0.4% -5.8% Electronics $54.7 $50.2 8.9641434262948197 Consolidated GMF 29.1 35 -0.16857142857142854 Adjusted EBITDA $83.800000000000011 $85.2 -1.6% Adj. EBITDA Margin 0.29653220099079974 0.30031723651744796 - 30 bps $ in millions FY % Change 2020 2019 All-in Organic (1) Chemistry $690 $596.20000000000005 0.157 4.9000000000000002E-2 Equipment $107.7 $86.7 0.24199999999999999 0.22500000000000001 Net Revenue $797.7 $682.90000000000009 0.16800000000000001 7.1999999999999995E-2 Electronics Adj. EBITDA $259 $241.6 7.2019867549668895E-2 Adj. EBITDA Margin 0.32500000000000001 0.35399999999999998 - 290 bps $ in millions Q1 % Change 2020 2019 All-in Organic (1) Chemistry $106.7 $113.9 -6.3% -7.6% Equipment 3.9 20 -0.80600000000000005 -0.8 GMF Net Sales $110.60000000000001 $133.9 -0.17399999999999999 -0.184 Adj. EBITDA $29 $35 -0.17142857142857143 Adj. EBITDA Margin 0.26220614828209765 0.26138909634055263 + 10 bps $ in millions Q1 % Change 2020 2019 All-in Organic (1) Electronics $172.1 $149.9 0.14799999999999999 5.5% GMF 110.5 133.80000000000001 -0.17399999999999999 -0.184 Net Sales $282.60000000000002 $283.70000000000005 -0.4% -5.8% Electronics $54.7 $50.2 8.9641434262948197 Consolidated GMF 29.1 35 -0.16857142857142854 Adjusted EBITDA $83.800000000000011 $85.2 -1.6% Adj. EBITDA Margin 0.29653220099079974 0.30031723651744796 - 30 bps $ in millions Q1 % Change 2020 2019 All-in Organic (1) Chemistry $154.69999999999999 $129.19999999999999 0.19800000000000001 8.7% Equipment 17.399999999999999 20.7 -0.161 -0.14699999999999999 Net Sales $172.1 $149.89999999999998 0.14799999999999999 5.5% Electronics Adj. EBITDA $54.7 $50.2 8.9641434262948197 Adj. EBITDA Margin 0.31783846600813481 0.33488992661774525 - 170 bps $ in millions FY % Change 2020 2019 All-in Organic (1) Chemistry $424 $469.29999999999995 -0.1 -0.11899999999999999 Equipment $12.6 $35.6 -0.64600000000000002 -0.65 GMF Net Revenue $436.6 $504.9 -0.13500000000000001 -0.156 Adj. EBITDA $104.9 $138.5 -0.2425992779783393 Adj. EBITDA Margin 0.24 0.27400000000000002 - 340 bps


Slide 12

Adjusted EBITDA Reconciliation 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9


Slide 13

Adjusted EBITDA Reconciliation (Cont’d)


Slide 14

Adjusted Free Cash Flow Before Debt Service (1) Capex is presented net of proceeds from disposals of intangible assets and property, plant, and equipment OWC = Operating working capital and includes trade receivables and inventories less trade payables Following our IPO in February 2021, we redeemed in full all $425.0 million of our 6.250% Senior Notes due 2025 and all $219.0 million of our 8.75%/9.50% Senior PIK Toggle Notes. Quarter Ended Fiscal Year Ended ($ in millions) 12/31/2020 12/31/2019 12/31/2020 12/31/2019 Adj. EBITDA $106 $101 $364 $380 - Capex (1) $-14 $-25 $-53 $-66 - Change in OWC (2) 50 49 21 40 - Cash Taxes -22 -21 -71 -85 Adj. FCFFO before Debt Service (3) $120 $104 $261.5 $269.39999999999998 as a % of sales 0.33 0.34 0.21 0.23 as a % of Adj. EBITDA 1.1299999999999999 1.03 0.72 0.71 - Interest -31 -32 -,127 -,133 Adj. FCFFO before Debt Paydown $89 $72 $135 $136 as a % of sales 0.24 0.23 0.11 0.11 as a % of Adj. EBITDA 0.83 0.71 0.37 0.36


Slide 15

Revenue Growth Reconciliation Growth Factors Quarter ended 12/31/20 Reported Revenue Growth Impact of Currency Palladium Pass-through Organic Revenue Growth Electronics 0.25 (5%) (5%) 0.14000000000000001 General Metal Finishing 7.0000000000000007E-2 (2%) (3%) 0.02 Total 0.18 (4%) (5%) 0.09 Full-year ended 12/31/20 Reported Sales Growth Impact of current Palladium pass-through Organic growth Electronics 0.17 0.01 0.09 7.0000000000000007E-2 General Metal Finishing -0.16 -0.01 0.03 -0.14000000000000001 Total 0.04 0 0.06 -0.03 Growth Factors 3 months ended 12/31/20 Reported Sales Growth Impact of current Palladium pass-through Organic growth Electronics 0.25 0.05 0.05 0.14000000000000001 General Metal Finishing 7.0000000000000007E-2 0.02 0.03 0.02 Total 0.18 0.04 0.05 0.09 Full year ended 12/31/20 Reported Revenue Growth Impact of Currency Palladium Pass-through Organic Revenue Growth Electronics 0.17 (1%) (9%) 7.0000000000000007E-2 General Metal Finishing (14%) 0.01 (3%) (16%) Total 0.04 0 (6%) (2%)