Trinseo PLC Q1 FY2025 earnings call

• Core business results in Q1 were in line with expectations and sequentially higher due to seasonality and prior quarter customer destocking. - Adjusted EBITDA improved to $65 million, driven by restructuring actions, improved business mix, and polycarbonate licensing agreement. - Focus on transformation strategy with levers like geographic expansion, material replacement, process change, and sustainability. - Grew volume in recycled content-containing products by 33%, consumer electronic applications by 43%, PMMA resin volumes in Asia more than doubled, and case volumes by 3% in flat demand. - Licensing income of $26 million recognized in Q1 from Deepak Chem Tech deal, projects on track worth $52 million. - China as growth market, with specialty PMMA products and sustainable solutions for consumer electronics driving 50% volume growth vs prior year.

In the first quarter, Trinseo's adjusted EBITDA improved to $65 million, up $20 million versus prior year. Latex Binders adjusted EBITDA was similar to prior year despite lower volume. Polymer Solutions adjusted EBITDA was above prior year due to $26 million licensing income and restructuring. Recycled content-containing products volume grew 33% over prior year, consumer electronic applications grew 43%, PMMA resin volumes in Asia more than doubled, and case volumes grew 3% in a flat demand environment. Revenue contribution details: 20% of Asia Pacific revenue is from consumer electronics.

• Withdrew full-year 2025 guidance. - Expect second quarter adjusted EBITDA to be between $55 million and $70 million, led by seasonally stronger volumes in building and construction, lower costs in engineered materials, and improved AmSty earnings.

• Tariffs and trade uncertainty creating uncertain demand environment, particularly in China and automotive industry. - Impact on overall demand could be significant.

Q: Question around volume patterns, especially EM business and consumer electronics volumes.

A: Frank Bozich said no pre-buying distortion, Q1 demand continued into Q2.

Q: Free cash flow guidance for Q2 and industry shutdowns.

A: Dave Stasse said confident in breakeven, no impact from styrene closures.

Q: AmSty performance and sale process.

A: Frank Bozich said waiting for best valuation, David Stasse talked about timing issues and outage resolution.

Q: Battery binders and AmSty profitability.

A: Frank Bozich talked about anode binders in batteries, AmSty expected to be closer to historical average.

Q: Full-year cash flow and licensing deals.

A: David Stasse discussed cash outflow and Frank Bozich mentioned potential for more licensing deals.