Element Solutions (ESI) Investor presentation summary

Strategic evolution and portfolio development

• Refined portfolio through divestitures and acquisitions, focusing on high-end electronics and advanced materials, including Micromax and EFC Gases & Advanced Materials.

• Enhanced supply chain partnerships and accelerated investments to support long-term growth.

• Shifted end-market exposure, reducing reliance on consumer and enterprise segments while expanding into automotive, data, and telecom infrastructure.

• Maintained high, stable gross margins and improved variable cost structure, with 85% of costs now variable.

Financial performance and metrics

• Achieved consistent ex-metal gross margins above 50% and adjusted EBITDA margins around 27% from 2021 to 2025.

• Free cash flow conversion remained strong, ranging from 47% to 59% of adjusted EBITDA.

• Net sales for 2025 projected at $2.1B+ for electronics and $800M+ for specialties, with significant regional and end-market diversity.

• Portfolio mix evolution led to higher growth rates and improved cash return on investment compared to peers.

Growth strategy and targets

• Medium-term organic growth rate targeted at ~7%, with 1-2% market outperformance over blended market growth of 5-6%.

• Electronics segment expected to grow at 9% and specialties at 5% through the cycle.

• Long-term adjusted EPS growth targeted at mid-teens percentage, supported by incremental adjusted EBITDA margins of 30-40%.

• Capital allocation and M&A strategy focused on bolt-on acquisitions in electronics and investing in emerging capabilities.