Solvay : Roadshows & conferences presentation September 2020 (pdf)

Solvay profile & strategy

September 2020

Forenote

This presentation may contain forward-looking information. Forward-looking statements describe expectations, plans, strategies, goals, future events or intentions. The achievement of forward-looking statements contained in this presentation is subject to risks and uncertainties relating to a number of factors, including general economic factors, interest rate and foreign currency exchange rate fluctuations, changing market conditions, product competition, the nature of product development, impact of acquisitions and divestitures, restructurings, products withdrawals, regulatory approval processes, all-in scenario of R&D projects and other unusual items. Consequently, actual results or future events may differ materially from those expressed or implied by such forward-looking statements.

Should known or unknown risks or uncertainties materialize, or should our assumptions prove inaccurate, actual results could vary materially from those anticipated. The Company undertakes no obligation to publicly update or revise any forward-looking statements.

This document does not constitute an offer to sell, or the solicitation of an offer to subscribe for or buy, any securities.

page 2

Summary

1. Solvay Profile & Strategy
2. H1/Q2 2020 Performance
3. 2019 Review
4. Annexes

page 3

First half 2020 earnings

Solvay Profile & Strategy

1

Solvay by the numbers

€10.2B

€2.3B

>50%

24,100

115

net sales

underlying EBITDA

revenue in faster

People at

Sites

53% sustainable

23% margin

growing economies

Solvay

globally

solutions

Evenly

2,100

€336M

>100

64

Balanced

revenue across Europe, the

R&I employees in

in R&I

nationalities

countries

Americas and Asia & RoW

21 major R&I centers

75%

240

2,630

1,900

of R&I pipeline revenue to

New patents

patents in force

intellectual

be from "Sustainable

In 2018

property

Solutions"

agreements

page 5

First half 2020 earnings

Solvay by markets and region

Asia, Pacific

& RoW

Europe

Net sales					Net sales
by market					by region
			11
					North America
			Latin America

page 6

First half 2020 earnings

2019 figures

Our purpose

AT OUR BEST

We bond people ideas and elements to reinvent progress

Our vision

Sustainable shared value for all

PROGRESS BEYOND

We Believe in

Purposeful Responsibility

Unity, Not

Uniformity

Passion for

Performance

As Solvay

Citizens

We

Care and

Collaborate

We Are

Customer

Obsessed

We make it happen

We Go

Beyond

As Leaders

We Lead with Purpose, Heart and Mind

We

Passionately

Coach People

to Their

Potential

We Learn,

Unlearn and Relearn

page 7

First half 2020 earnings

Financial performance

Underlying

EBITDA

(in € million)

Free cash flow

to Solvay shareholders from continuing operations

(in € million)

CAGR

c.5%

Underlying net financial debt

(in € billion)

2.8x

2.6x

Leverage

2.2x

2.1x

2.0x

in times

2.0x

[1]

Provisions

(in € billion)

Dividend

(in € per share)	CAGR
	c.5%

page 8	First half 2020 earnings	[1] €(433) million impact from IFRS16 implementation on January 1, 2019

Our Businesses Aligned to Powerful Megatrends

Megatrends	Electrification		Lightweighting		Resource efficiency		Healthcare		IoT / Digitalization		Eco-friendly based
											solutions

Our Solutions			High-performance polymer technology portfolio
& Value
• Binders & membranes		• Improving engine		• Flexible risers		• Long-term implants
Proposition
for Li-ion		efficiency &				• Medical devices
			downsizing
					• Dialysis membranes
			Thermoset		Extraction
	Electrolyte technology				• Pharma packaging
		composites		technologies
	• Next-generation		• Aerospace structures		• Cu flotation
	Li-ion				• Li extraction
			Thermoplastic composites
			• Aerospace industry		• Flexible risers
			• Automotive industry

Soda ash, Peroxides & Silica

• Eco-efficient glass		• Dialysis
• Air pollution control		• Disinfection
• Eco-efficient tires

	Bio-based ingredients
• New-generation	• Vanillin:
OLED & flexible	Flavors & fragrances

displays		• Guar:
High-purity chemicals		Agro & nutrition
	Home & personal care
• Semiconductor		products
industry consumables
		Waterborne solutions
		• Coatings

page 9

First half 2020 earnings

Our G.R.O.W. Strategy

A differentiated management approach to drive growth, cash, and returns

ACCELERATE GROWTH	DELIVER RESILIENT CASH

MATERIALS	CHEMICALS
Prioritize investments in high margin	Maximize cash flow generation from our
Materials businesses with high growth	resilient Chemicals businesses where we
potential, which are also our most	have a competitive advantage
sustainable solutions
Extend position as #1 pure-play	Become #1 cash conversion
advanced materials business	chemical player
		Soda Ash & Derivatives
Specialty Polymers	Peroxides
	Silica
Composite Materials
	Coatis
			Rusvinyl
35%	~28%	38%	~27%
2019 FY	2019 FY	2019 FY	2019 FY
NET SALES	EBITDA MARGIN	NET SALES	EBITDA MARGIN
67%	3.5%	79%	1%
2019 FY	2019 FY	2019 FY	2019 FY
Cash conversion	R&I Intensity	Cash conversion	R&I Intensity

OPTIMIZE RETURNS	WIN

SOLUTIONS	Solvay ONE
Optimize our Solutions businesses to
unlock value and increase returns.	Create a winning
		team and operating
		model to support a
		performance-driven
		culture and win with
Unlock value	our customers
Novecare
Technology Solutions
Special Chem
Aroma Performance
27%	~17%
2019 FY	2019 FY
NET SALES	EBITDA MARGIN
68%	3.3%
2019 FY	2019 FY
Cash conversion	R&I Intensity

G

GROWTH

R

RESILIENCE

O

OPTIMIZE

W

	[1] Cash Flow Return On Investment measures the cash returns of Solvay's business activities. Movements in CFROI levels are relevant indicators for showing whether economic value is being added, though it is accepted that this
page 10	measure cannot be benchmarked or compared with industry peers. The definition uses a reasonable estimate of the replacement cost of assets and avoids accounting distortions, e.g. for impairments. It is calculated as the ratio
between recurring cash flow and invested capital, where: Recurring cash flow = Underlying EBITDA + Dividends from associates and JVs - Earnings from associates and JVs + Recurring capex + Recurring income taxes ; Invested

capital = Replacement value of goodwill & fixed assets + Net working capital + Carrying amount of associates and JVs ; Recurring capex is normalized at 2% of the replacement value of fixed assets net of goodwill values ; Recurring income tax is normalized at 30% of (Underlying EBIT - Earnings from associates and JVs)

WIN

Materials

#1 pure play advanced materials business

Unique high-performancepolymers & composite technologies

Strong growth opportunities

• Sustainable automotive
• Sustainable aerospace
• Healthcare
• Electronics

LIGHT-WEIGHTING

ELECTRIFICATION

EXPANDING

HEALTHCARE

IOT /		RESOURCE
DIGITALIZATION		EFFICIENCY

Strategic intent

Accelerate growth

	Innovation		Customers		Investment
	Research,			Upgrade key			Prioritize
	digital and			account resources			investments
	technical		and e-commerce			for growth
	support		platforms

Key levers

• Realign organization around growth opportunities
• Accelerate innovation with highest-growth customers
• Reallocate resources to thermoplastic composites and battery platforms to accelerate customer wins
• Improve operational efficiencies through simplification, order to cash optimization and digitalization

Track record

+7%

EBITDA growth

(organic 2014-2019)

~28%

EBITDA margin

(2019)

>25%

Vitality index

(2018) [1]

Returns > WACC

(average 2014-2019)

G

GROWTH

R

RESILIENCE

O

OPTIMIZE

W

WIN

page 11

First half 2020 earnings

Chemicals

#1 cash conversion chemical player

World-leadersin essential chemicals to daily life

Mono-technology businesses

• Soda ash
• Peroxide
• Silica
• Phenol chain

RESOURCE EXPANDING

EFFICIENCY HEALTHCARE

Strategic intent

Deliver resilient cash

	Innovation		Customers		Investment
	Focus on			Leverage			Selectively
	process			best-in-class			invest in
	innovation		global production			capacity
				assets

Key levers

• Adapt organization to focus on cash and returns
• Drive focused productivity and rationalization programs
• Prioritize Capex to maintenance and invest selectively for compelling cash returns, e.g. natural soda ash
• Focus R&I on process innovation

Track record

+9%

Cash flow growth

(organic 2014-2019)

~79%

Cash conversion

(2019)(1)

~27%

EBITDA margin

(2019)

Returns at WACC

(average 2014-2019)

G

GROWTH

R

RESILIENCE

O

OPTIMIZE

W

WIN

page 12

First half 2020 earnings

Solutions

Unlock value

Unique formulation & application expertise

Selective opportunities to grow

• Natural food ingredients
• Crop care
• Coatings
• Mining solutions

				ECO-FRIENDL
IOT /		RESOURCE		Y
DIGITALIZATION		EFFICIENCY		SOLUTIONS

Strategic intent

Optimize returns

	Innovation		Customers		Investment
	Focus on			Digitalization,			Selective
	eco-friendly			focus on key			in niche
	solutions		accounts			opportunities

Key levers

• Innovate selectively in specialty niche markets
• Fix shale oil & gas and other low-return businesses
• Drive efficiency and address fragmented industrial footprint

Track record

Returns < WACC

(average 2014-2019)

Flat

Net sales & EBITDA growth

(average 2014-2019)

~17%

EBITDA margin

(2019)

G

GROWTH

R

RESILIENCE

O

OPTIMIZE

W

WIN

page 13

First half 2020 earnings

Solvay ONE PLANET

CLIMATE

RESOURCES

BETTER LIFE

page

Strong ESG credentials

MSCI ESG	SUSTAINALYTICS	FTSE4GOOD	WBCSD
AAA	#2 out of 42	92nd percentile	Top 10
(AAA-CCC scale)

"Science and research play an important role to tackle the world's environmental and health challenges and I'm particularly

Bertrand Piccard

Chairman of the Solar Impulse Foundation

"With the launch of its Solvay One Planet plan, the company is sending a strong signal to the chemical industry and its value chain that the circular economy is happening - and that Solvay wants to lead

Ellen MacArthur

Founder of the Ellen MacArthur Foundation

Our 2030 Sustainability Goals

SOLVAY ONE PLANET

CLIMATE

RESOURCES

BETTER

LIFE

	Align greenhouse gas emissions with Paris Agreement
			Reduce by 26% (-2%/y)
	Phase out coal			Achieve 100%
	Reduce negative pressure on biodiversity			30% reduction
	Increase Sustainable Solutions revenues				Achieve 65% vs 50%
					Achieve 15% vs 7%
	Increase Circularity
	Reduce non-recoverable industrial waste			30% reduction
	Reduce intake of freshwater			25% reduction
	Safety is a priority
			Aim for zero accident
	Accelerate Inclusion & Diversity			Parity in 2025 vs 24%
			for mid & senior management
	Extend maternity leave and to all co-parents			16 weeks in 2021

page 15		First half 2020 earnings	2018	baseline

Why Invest?

Future growth potential fuelled by megatrends

Global scale, diversity of products and end-markets, reliable infrastructure

Proven resilience through Crises

Customer partnerships

drive innovation

Key leadership positions

Bold ESG Ambition with

Solvay ONE

Planet

page 16

First half 2020 earnings

First Half / Q2 2020 performance

2

First Half 2020 Performance

Strong free cash flow despite demand headwinds

€435m €4.6bn €1,008m

FREE CASH FLOW

to shareholders, continuing ops

FCF conversion ratio (LTM) 49.1%

• Disciplined working capital
• Lower pension cash costs
• Lower cash taxes

NET SALES

• Lower volumes in aero, auto, oil & gas and construction markets
• Resilient volumes in healthcare, agro & food, home & personal care and electronics

UNDERLYING EBITDA

Margin 21.7%

● Reduction in volumes ● Positive pricing

page 18

First half 2020 earnings

Solvay performance by end markets in H1 2020

		% Solvay
End Market		annual	Solvay first half 2020 performance
		sales 2019
Building & Construction/Industrial	16%		Short-term impact¹ to Chemical & Solutions segments
Automotive	14%		Penetration of high-performance polymers in under-the-hood and
	battery applications
Food/Agro/Feed
12%		Natural vanillin growth and good Agro market conditions
Home & Personal Care
8%		Resilient and good demand for bio-based products + innovation
Civil Aerospace
7%		Fast-tracking composite restructuring plans to mitigate civil decline
Electronics
5%		Resilient especially semiconductors
Healthcare
4%		Growth in various applications + new business
Mining	4%		Short-term impact¹ in Solutions segment
Shale Oil & Gas
4%		Turnaround plan supports cost reductions + market share gains
		~75%
				¹impact from Covid-19 pandemic

page 19

First half 2020 earnings

Materials

Q2 2020 performance

-19%			-28%		25%
	Net sales	EBITDA		EBITDA
		y/y organic		y/y organic			margin

Market Drivers

Performance Highlights

2019 Net Sales by End-Market

Materials

Specialty Polymers, Composite Materials

Automotive & Aerospace	55%	25%
Industrial Applications	11%	19%

• Significant volume decline related to commercial aircrafts and automotive
• Growth in healthcare while electronics and defense resilient

• Rapidly adapted production levels to changing demand
• Sustained prices

Consumer goods, Healthcare	10%	17%
Electricals & Electronics	10%	5%
Resources & Environment	7%	14%
Building & Construction	3%	8%
Agro, Feed & Food	3%	12%

page 20

First half 2020 earnings

Chemicals

Q2 2020 performance

-19%			-30%		25%
	Net sales	EBITDA		EBITDA
		y/y organic		y/y organic			margin

2019 Net Sales by End-Market

Chemicals

Soda Ash & Derivatives, Peroxides,

Coatis, Silica and Rusvinyl

Market Drivers

• Lower demand in construction, glass container, and auto markets
• Good demand consumer goods
• Brazil currency devaluation

Performance Highlights

• Lower volumes partly offset by higher prices
• Strong focus on costs and operational excellence

Consumer good, Healthcare	26%	17%
Industrial Applications	21%	19%
Agro, Feed & Food	18%	12%
Automotive & Aerospace	15%	25%
Building & Construction	12%	8%
Resources & Environment	8%	14%
Electricals & Electronics	0%	5%

page 21a

First half 2020 earnings

Solutions

Q2 2020 performance

-14%			-26%		16%
	Net sales	EBITDA		EBITDA
		y/y organic		y/y organic			margin

2019 Net Sales by End-Market

Solutions

Novecare, Special Chem, Technology

Solutions and Aroma Performance

Market Drivers

• Weaker demand in oil & gas, mining, automotive
• Good demand in home & personal care, agro & food
• Resilience in coatings and electronics

Performance Highlights

• Lower volumes primarily driven by oil & gas
• Cost control and pricing helped sustain margins

Resources & Environment	24%	14%
Industrial Applications	23%	19%
Consumer goods, Healthcare	16%	17%
Agro, Feed & Food	14%	12%
Automotive & Aerospace	9%	25%
Building & Construction	8%	8%
Electricals & Electronics	6%	5%

page 22

First half 2020 earnings

Strong free cash flow generation

Driven by disciplined working capital management

First Half 2020

Capex		Working	Provisions	Financing	Taxes
		capital			& Other	FCF to Solvay
Underlying
EBITDA						shareholders from
							cont. ops.

Year over year levers

							Taxes
Provisions			Financing				& Other

FCF to Solvay

Working

EBITDA

Capex

capital

shareholders from

Yoy

cont. ops.

H1 2020 FCF

to Solvay shareholders

€435m vs. €33m in H1 2019

Main drivers:

• Disciplined working capital
• Reduced cash taxes & cash pension costs

page 23

First half 2020 earnings

Cost savings status update, 2020

Structural

CM

Temporary

First Half 2020

€80m

€90m

€170m

Structural levers (€80m)

• Restructuring 45%
• Indirect Spend 40%
• Productivity Efficiencies 15%

Temporary levers (€90m)

• Furloughs
• Salary freeze & reductions
• Discretionary costs

FY 2020 estimate

€150m Structural measures 2020

		Temporary
€150m
	measures 2020

€300m

page 24

First half 2020 earnings

Outlook and expectations for full year 2020

Demand CostsCash

Challenging		Cost savings of ~		Free Cash Flow in
environment		€300m gross,		line with FY 2019
continues into Q3		structural and
before improving		temporary
in Q4

Low visibility continues into Q3;

Remain focused on Cost and Cash levers

page 25

First half 2020 earnings

Structural
€350m
(Nov'19 G.R.O.W.
strategy + Feb'20)		Composite
		Materials
		+€60m
		(May'20)

page 26

'GROW'

Cost savings plan

Overview of structural targets

Main Levers

• Restructuring
• Indirect Spend
• Productivity Efficiencies

Total structural target of €410 million gross savings by 2024

>35% plan to be achieved in year 1

Presentation name

2019 review

3

12 months in review

Long-term actions to unleash longer-term results

G.R.O.W.	Structure	Culture	Core competencies
Strategy	Solvay ONE	Purpose	& incentives

	Customer	Innovation	ESG
	partnerships	TPC platform	Solvay ONE Planet
			Battery platform
page 28			R&I Centers
	First half 2020 earnings

2019 Results

Delivery on our financial and sustainability objectives

NET SALES

€10bn

-2% yoy

GHG

EMISSIONS

-5%

in % at constant perimeter vs. Y-1

FCF to

UNDERLYING

EBITDA

Solvay shareholders

EBITDA

margin

continuing operations

€2.3bn

23%

€606m

-2.8% yoy

stable yoy

+€40m yoy

organically

SUSTAINABLE

OCCUPATIONAL

SOCIETAL

SOLUTIONS

ACCIDENTS

ACTIONS

53%

-

18%

47%

+3% yoy

yoy

+14% yoy

page 29

First half 2020 earnings

Annexes

4

Sustainable value creation integrated in group compensation structure

Fixed Compensation

Short and Long

and Benefits

Term Variable Compensation

Annual

Pension

Short term

Performance Share

Stock

Base Salary

& Benefits

incentive

Units (*)

Options (*)

PERFORMANCE

1 year

3 years

3 years

following

PERIOD

the grant year

PERFORMANCE

• Underlying

• Sustained

•

Share price

MEASURES

EBITDA growth

underlying EBITDA

increase

• Free Cash Flow

growth

on YoY basis

converstion

•

Sustainable

• ROCE %

Development

• Reduction of GHG

•

Individual

(CO2) emissions

Objective

page 31

First half 2020 earnings

1. The corresponding number of stock options (SOP) is determined at grant date, based on the fair market value of the SOP. The PSU value is the closing share price on the grant date.

Balanced maturities

Deleveraging and reduced of cost of debt

Major financial debt [1]

in million (EUR and USD)

page 32

Bonding with customers to create value

UDELⓇ		RADELTM		CYCOMⓇ prepreg		Solvay insideⓇ		Solvay insideⓇ
Polymer for hemodialysis		Face Shields to protect		Strike protection		Testing kit & antiviral drug		Cough suppressant
			COVID-19
membranes		against COVID-19	surfacing film			drugs

HyflonⓇ	FomblinⓇ
& RytonⓇ	PFPE

Hair straighteners	New generation OLED &
flexible displays

InteroxⓇ		Solvay	PolycareⓇSPLIT
PicoPlus		insideⓇ	Therapy
for the highest purity in		Electronic equipment	repair formulation
electronics manufacturing		application

page 33

First half 2020 earnings

Automotive

We make cars more efficient

MARKET DRIVERS

Fuel efficiency / lightweighting regulations driving CO2 reductions

• EU target 95g CO2/km by 2020
• US target 50% reduction on new vehicles by 2025

Shift to electrification

• ~30% CAGR hybrid & plug-in electric vehicles in 10 years
• Increasing polymer weight per car 6kg ICE ➝ 12kg P(HEV)
• Content doubles with move toward hybrid vehicles

	Solvay		Coolant systems
	outpaces			thermal
	growth 3X
		Management
					systems
page 34

				RESOURCE
ELECTRIFICATION		LIGHTWEIGHTING
		EFFICIENCY

HOW WE WIN

Broadest portfolio of advanced materials

• Greater use of high-performance polymers to meet more critical applications

Deep customer relationships

• Strategic collaborations across OEMs
• Alliance on next generation battery development

Leveraging core competencies

• Knowledge to integrate design, materials and processes

Transmissions

Sensing & Autonomous Driving System

Li-ion battery

~15%

net sales

Aerospace

LIGHTWEIGHTING RESOURCE

We make aircraft lighter & more efficient	EFFICIENCY

MARKET DRIVERS

4.3% annual growth in passenger traffic

10% ➝ 50% by weight

• Significant increase of composites on new aircrafts vs. legacy aircrafts

~40,000 new aircrafts in next 20 years

HOW WE WIN

Broad customer base

• Positions with major global OEMs in US, Europe, China & Russia
• Long-termcontracts on key programs across commercial & military sectors

Technology leadership

• Thermoset & thermoplastic composites
• Resin infusion & bonding technology
• LEAP engine technology
• Airbus A220 wing technology
• Winglet aerodynamic technologies

~10%

net sales

Primary

Secondary structures

structures

Interiors & Galleys

Engines

Surface coatings

Bonding & Multifunctionality

page 35

Thermoplastic composites

LIGHTWEIGHTING RESOURCE

For aerospace, automotive and oil & gas

EFFICIENCY

MARKET DRIVERS

Why Thermoplastics?

Fast cycle time

• Enabling increased build rates
• More efficient part assembly

Performance and durability

• High strength
• Unrivaled toughness
• Weight reduction

Environmental resilience

HOW WE WIN

Investments

• Capacity expansions in aero (Sept 2019)
• New capacity for oil & gas (Oct 2019)
• Two innovation center openings (Oct 2019)
• • Brussels
  • Atlanta USA

Customer partnerships

• Supplying aero for >30 years
• New customer agreement in oil & gas

Addressable market size (aero + oil & gas)

~10%

net sales

•	Resistance to aggressive fluids	• € 500M
•	Corrosion resistance

page 36

First half 2020 earnings

We are a technology leader

for mission critical battery					RESOURCE
ELECTRIFICATION		LIGHTWEIGHTING		EFFICIENCY
materials
		A unique expertise in fluorine chemistry and
		advanced conductive materials
	ENERGAIN®							NOHMS* TFSI ILS

Fluorinated solvents and formulations for High Voltage electrolytes

Ionic liquids based on TFSI for High Voltage Li-Ion electrolytes

*NOHMS Technologies develops new generation electrolytes for Li-on batteries

F1EC, F2EC, SA

LiTFSI, LiFSI, LiTA

Fluorinated additives

Lithium salts for electrolytes

for electrolytes

SOLEF® PVDF

SOLEF® PVDF

Binders

Separators coating

HIGHER PERFORMANCE

LOWER COST

SAFETY

Towards Solid-state	HIGHER	LOWER COST	SAFETY
battery
PERFORMANCE

page 37

Broadest portfolio of advanced materials differentiating Solvay from competition

Aromatics

Fluoropolymers

High Perf Composites

Carbon

Thermoset

Resin

Adhesives

Thermo-

Out-of-

HPPA

PPS

PAEK

PSU

PTFE

PVDF

PFA

FKM

PFPE

&

plastic

Autoclave

Fiber

Prepreg

Infusion

Surfacing

prepreg

prepreg

films

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page 38

First half 2020 earnings

Electronics

Beyond smartphones

MARKET DRIVERS

Double digit growth expected

• The growing demand for hyper-connectivity and the fast development of 5G
• Exponential growth of data, leading to necessary miniaturization
• Internet of Things
• Need to reduce the energy consumption of components

IOT/

DIGITALIZZATION

HOW WE WIN

We target advanced technology markets driven by strong long-term trends with a portfolio of solutions

• Specialty polymers providing high performance solutions for structural and electronic components
• Recognized expertise in high purity chemistry for the semi-conductor industry
• New generation materials for OLED, delivering high quality diffuse light from thin and potentially flexible displays

~5%

net sales

Innovation is key to anticipate the fast moves in this industry

More specifically, 5G and Internet of things, will open many new markets where Solvay's expertise and customer intimacy will be key assets.

CHIP TESTING	O-RING	VACUUM PUMP	WEARABLE	COVER	ACOUSTIC	SMART
PUMP	& SEALING	SEALING	BANDS	FILMS	COMPONENTS	SENSOR

PACKAGING

page 39

Healthcare		EXPANDING		ECO-FRIENDLY
We improve comfort for others		HEALTHCARE		SOLUTIONS
	MARKET DRIVERS		HOW WE WIN

+5-7% CAGR

• Health care coverage in developing markets
• The growing care needs of elderly populations (ageing and growing populations and increasing life expectancy)
• Advances in treatments and health technologies
• High sterilization capabilities

We improve comfort for over 2 million

patients undergoing a.o. dialysis, orthopedic (knee, hip, spine) or cardiovascular procedures.

We provide 50 to 90% reduction in medical device cost while enabling greater design freedom and improved ergonomics through lightweighting.

We are in 1 in every 4 pharmaceutical blister packs globally which is over 400 billion pills.

Patient care: World leader in thermoplastics used for high performance membrane

Pharma packaging

World leader in high barrier polymers to package pharmaceuticals

Technology leadership

• Medical grade plastics for limited exposure applications
• Biomaterials for long-term exposure applications
• 3D additive manufacturing compatibility

~5%

net sales

			HEMODIALYSIS				LONG-TERM	SURGICAL	CASE
			PACKAGING
page 40			MEMBRANES				IMPLANTS	INSTRUMENTS	& TRAYS

Home & Personal care

Performant and convenient

MARKET DRIVERS

Attractive market potential: GDP+

• Request for more natural and bio based solutions
• Growing customer base
• Enhanced performance and convenience
• Demand for Personalized and Premium Products
• Digital tools enabling the niche brands

Our Products can be found in over 2.5B bottles of personal care products every year, enhancing the lifestyle of millions of consumers around the globe.

We support more sustainable lifestyles in Home & Hygiene through our solutions for long lasting disinfection, low energy washing, and fabric enhancement, present in over 1.5B bottles every year.

page 41

ECO-FRIENDLY

SOLUTIONS

HOW WE WIN

We provide our customers with portfolio of innovative polymers and surfactants

• Homecare and I&I: solutions & ingredients for fabric care, dish care and surface care that enhance the performance
• Personal care: natural & synthetic polymers, surfactants, fragrances and precipitated silica serving the hair/skin/oral care and cosmetics markets
• Food packaging: high performance materials for safe, reliable and convenient food packaging
• Aroma: world's largest integrated producer of vanillin for the flavors & fragrances industries

~10%

net sales

Soda ash & Bicarbonate

EXPANDING	RESOURCE
Resilient demand & strong cash conversion HEALTHCARE	EFFICIENCY

MARKET DRIVERS

Resilient growing soda ash demand

• Mix of consumer and industrial-driven demand

Environmental standards supporting future growth

• Insulation glazing & solar panels
• Plastics substitution in container glass
• Air pollution control from land facilities (power plants, incinerators) to shipping vessels
• Lithium extraction to fuel (EV) batteries

HOW WE WIN

We offer security of supply

• Global network of world-class and local assets
• Capacity addition of 1.4 Mt capacity in soda ash and bicarbonate by 2022

We are technology and cost leaders

• Strong asset base, based on scale, access to marine transport
  and natural soda ash
• Digitalization & manufacturing excellence drive cost competitiveness
• Focus on reducing CO2 footprint
• Development of sustainable bicarbonate solutions

~16%

net sales

>10% Cash flow growth[1]

(average 2016-2019)

~75% Cash conversion[2]

(2019)

1. Operational cash flow after Capex and WC before payment of taxes and liabilities
2. EBITDA - Capex) /
   EBITDA
3. Solvay internal
   estimate, based on external data (IHS, CFRA)

	~ 15%		~ 15%
		CONSTRUCTION			HOME
							& HEALTH CARE
	~ 15%			~15%
				FOOD			RESOURCES
				PACKAGING			& ENVIRONMENT
page 42							(flue gas treatment,
							mining, …)

~ 30%

CHEMICAL INDUSTRY

~ 10%

AGRO

& FOOD

Peroxides

Resilient demand & strong cash conversion

RESOURCE EFFICIENCY

MARKET DRIVERS

Resilient & growing H202 & (HP)PO markets

HOW WE WIN

We partner with our customers

• Diversity of markets decreases cyclicality
• Applications in Agro / Food, Consumer Goods, Electronics, Energy / Environment to grow at GDP+
• HP-POcapacity to grow at ~4% CAGR to 2024 as one winning technology

• Offering a global footprint for security of
• Building long term partnerships to joint business
• Developing selectively high value applications close to the markets

~6%

net sales

Sustainability is a key growth driver

• Versatility of use, efficiency and sustainability profile of peroxides drives demand & new applications

We offer best-in-class technology

• Unique ability to build small to mega-plants
• 3 mega HP-PO plants (>60% of WW HP-PO capacity) with long term contracts with BASF, Dow & Saudi Aramco in PO/PU chain, with stable return mechanism

~ 25%

~ 25%

~ 30%

>25% Cash flow growth[1]

(average 2016-2019)

~85% Cash conversion[2]

(2019)

1. Operational cash flow
   after Capex and WC before payment of taxes and liabilities
2. (EBITDA - Capex) /
   EBITDA
3. Source: Solvay figures based on external sources (IHS, …)
4. PO use in the following applications: Consumer goods, Industrial & chemicals, Construction and Automotive &

page 43

PULP	CONSUMER	INDUSTRY
	GOODS	& CHEMICALS
		(including HPPO)

	~ 5%		~5%			~ 5%
	RESOURCES &		AGRO & FOOD			CONSTRUCTION
	ENVIRONMENT		(aqua-culture,
	(mining, …)		animal feed, …)

Digitalization as key enabler for further value creation

DIGITALIZATION

OF PLANTS

Increase asset performance

• Leveraging data analytics

Improve reliability of equipment

• Monitoring and predictive modeling for failure prevention

Improve productivity of shop floor

• Mobile dashboards and digital resources for operators

Example

in Specialty Polymers

• +18% tons/yr gain in fluids
• +26% tons/yr gain in HFP
• +15% tons/yr
  gain in PVDC & PVDF

DIGITALIZATION FOR CUSTOMERS

• Real-timedata analysis
• Technical recommendations
• Reduce process variability

Example

in Technology Solutions

• Real-timedata enables ongoing interaction with customer
• Immediate recommendations on new solutions
• Virtual tech support with immediate benefit to customers' bottom line

page 44		First half 2020 earnings

Solvay stock information

Listing on Euronext Brussels & Paris, compartment A

ISIN code	BE0003470755
Member code	SOLB
Currency	EUR
Deferred settlement service	Eligible
Shares saving plan PEA	Eligible
International tax exemption	concluded with a number of countries
Number of shares	105,876,416

Solvay is included in major indices: Bel20, CAC Next 20, STOXX family (DJ Stoxx and DJ Euro Stoxx), MSCI index, Euronext 100 as well as the DJSI World Index and the FTSE4Good, one of the key indices for socially responsible investment.

	Visit our section		Financial calendar
	dedicated to		Publications
		Presentations
	private investors
		Webcasts
				and more...
page 45			First half 2020 earnings

How to hold Solvay shares?

Solvay ordinary shares can be held as:

• Dematerialized shares: your shares remain with your financial intermediary, who manages them.
• Registered shares: your shares are registered in Solvay Register, and managed by Solvay Registered Shares Management Service. This type of holding shares enables you to benefit from different advantages.
• American Depositary Receipts (ADRs): your shares remain with your financial intermediary or with the ADR Depositary Bank (Citi), depending on your choice

Now available for download:

Solvay 2019 Annual report

ADR program for US investors

ADR program for US investors

ADR symbol	SOLVY
Platform	OTC
CUSIP	834437303
DR ISIN	US834437305
Underlying ISIN	BE0003470755
SEDOL	BD87R68
Depositary bank	Citi
ADR ratio	1 ORD : 10 ADR

Benefits of ADR's

• Clear and settle according to US standards
• Convenience of stock quotes and dividend payments in US dollars
• Purchase in the same way as other US stocks via a US broker
• Cost effective means of building an international portfolio

Contact CITI to create Solvay ADRs

New York Michael O'Leary [e-mail] [phone]

London Mike Woods [e-mail] [phone]

Solvay today serves US customers such as Apple, Boeing & Spirit AeroSystems. We develop solutions that meet our customers' demand for performance, sustainability and resource efficiency. As of 2019, Solvay employs 6,175 people at 38 industrial sites in North America, with 7 Research and Innovation Centers and 3 corporate locations in Alpharetta (Georgia), Houston (Texas) and Princeton (New Jersey). With the acquisition of the US company Cytec at the end of 2015, Solvay reinforced its place in the aerospace and automotive markets, enabling the group to develop new products and technologies that meet the requirements of the next generation of sustainable mobility.

page 46

First half 2020 earnings

Our Purpose

We bond people, ideas and elements to reinvent progress.

Together we can create

a sustainable and shared future.

page 47

Thank you.

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