Slides
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2Q 2025 financial results July 31, 2025
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Forward-looking statements The information in this release 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 sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the company's Annual Report on Form 10- K for the fiscal year ended December 31, 2024, and as updated 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 Earnings referenced in this presentation and the accompanying prepared remarks exclude certain non-core items. “Adjusted EBIT” is Earnings Before Interest and Taxes (“EBIT”) adjusted for non-core items. “Adjusted EBIT Margin” is Adjusted EBIT divided by GAAP sales. “Adjusted EBITDA” is Earnings Before Interest, Taxes, Depreciation, and Amortization adjusted for non-core items. Adjusted EPS is defined as the GAAP measure earnings per diluted share adjusted for non-core, unusual, or non-recurring items. “Net Debt” is total borrowings less cash and cash equivalents. “Net Debt to Adjusted EBITDA” is Net Debt divided by EBITDA adjusted for non-core items. Reconciliations to the most directly comparable GAAP financial measures and other associated disclosures, including a description of the excluded and adjusted items, are available in our second-quarter 2025 financial results news release which is posted in the “Investors” section of our website and in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Forms 10-K filed for 2024 and 10-Q to be filed for second quarter 2025 with the SEC for the periods for which non-GAAP financial measures are presented. Prepared remarks These slides should be reviewed with the accompanying prepared remarks posted on our website. 2
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2Q 2025 highlights Strong results in Additives & Functional Products driven by mix improvement and leverage to stable end markets and solid results in Advanced Materials despite significant challenges in key end markets Adjusting global supply chain as we continue to navigate the economic impact of increased tariff levels and related uncertainty Continued commercial excellence by our teams keeping price-cost in specialties stable and defending market share Increasing focus on cost reduction and cash generation in a persistently challenging global macroenvironment 3 Circular platform continues making progress, with methanolysis plant setting new production records, strong customer engagement with new business pipeline building, and we are developing capital-efficient options for a second facility
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Corporate 2Q25 vs. 2Q24 EBIT highlights • Volume/mix growth in the specialties more than offset by Fibers decline • Benefit from strong operational performance at the Kingsport methanolysis facility • Unfavorable spreads in CI in competitive export markets • ~$20 million headwind from unplanned outage in CI Revenue change % Total Vol / Mix Price FX 2Q25 vs 2Q24 -3 -3 0 0 2Q25 vs 1Q25 0 -1 0 1 $M (except EPS) 2Q25 2Q24 1Q25 Revenue 2,287 2,363 2,290 Adjusted EBIT 275 353 311 Adjusted EBIT margin 12.0% 14.9% 13.6% Adjusted EPS 1.60 2.15 1.91 4
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Circular Economy platform remains a key differentiator for Eastman despite near-term tariff and macro challenges ➢ Strong first-half operational performance at Kingsport methanolysis facility • Recorded best-ever uptime and production quantities, on track to achieve >2.5x 2024 levels and great progress on cost- reduction targets • Line of sight to ~30% capacity expansion over nameplate with modest capital in the couple of years ➢ While customers are still highly engaged, tariffs and economic uncertainty are delaying customers’ timelines for new product launches • Over 100 specialty customers with strong engagement and new business pipeline building • Packaging customers increasing volume commitments next year due to performance limitations of mechanical recycling ➢ Developing new options for second plant that would enable more continuous earnings growth and delaying ramp up of capital by ~2 years • Maximizing production from Kingsport facility • Currently evaluating capital-efficient options for the next methanolysis plant • Positioned to quickly resume investment when economic recovery occurs Continue to expect around $75 million EBITDA in FY25 vs FY24 from Kingsport methanolysis facility 5
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Tailwinds: • Kingsport methanolysis revenue and continued strong operational performance • Continued commercial excellence in pricing and defending share • Cost-reduction initiatives 2Q25 vs. 2Q24 EBIT highlights • Lower volume/mix in building and construction and automotive • Stable price-cost • Higher planned maintenance Headwinds: • Expect $50M–$60M negative impact from: • Aggressive inventory actions to drive cash generation (~$30M) • Mid-single digit volume decline due to impact of tariffs, continued customer caution, and pull-forward in 2Q 3Q 2025 sequential outlook Advanced Materials Revenue change % Total Vol / Mix Price FX 2Q25 vs 2Q24 -2 -2 0 0 2Q25 vs 1Q25 8 7 0 1 $M 2Q25 2Q24 1Q25 Revenue 777 795 719 EBIT 121 131 116 EBIT margin 15.6% 16.5% 16.1% Expect Q3 2025 EBIT significantly lower than Q2 2025 EBIT6
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2Q25 vs. 2Q24 EBIT highlights • Higher sales volume/mix in care chemicals and specialty fluids • Favorable price-cost, with pricing mostly driven by cost-pass-through contracts Additives & Functional Products $M 2Q25 2Q24 1Q25 Revenue 769 718 733 Adjusted EBIT 153 123 141 Adjusted EBIT margin 19.9% 17.1% 19.2% Revenue change % Total Vol / Mix Price FX 2Q25 vs 2Q24 7 2 4 1 2Q25 vs 1Q25 5 3 1 1 Tailwinds: • Continued commercial excellence in defending price and share • Cost-reduction initiatives Headwinds: • Normal seasonal decline in agriculture and timing of heat transfer fluid project fulfillments • Softening automotive end market • Higher planned maintenance expense • Inventory actions to drive cash generation resulting in lower asset utilization Expect Q3 2025 EBIT lower than Q2 2025 EBIT 3Q 2025 sequential outlook 7
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2Q25 vs. 2Q24 EBIT highlights • Lower sales volume/mix due to: • Acetate tow customer inventory destocking and industry capacity share adjustments • Lower textiles sales resulting from negative impact of tariffs Fibers $M 2Q25 2Q24 1Q25 Revenue 274 330 288 EBIT 81 122 88 EBIT margin 29.6% 37.0% 30.6% Revenue change % Total Vol / Mix Price FX 2Q25 vs 2Q24 -17 -16 -1 0 2Q25 vs 1Q25 -5 -4 -1 0 Tailwinds: • Cost-reduction initiatives • Supporting textiles customers as they diversify their value chain outside of China Headwinds: • Customer inventory destocking in acetate tow continues • Modest tariff-related pull-forward for tow in 2Q • Inventory actions to drive cash generation resulting in lower asset utilization Expect Q3 2025 EBIT lower than Q2 2025 EBIT 3Q 2025 sequential outlook 8
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2Q25 vs. 2Q24 EBIT highlights • Spread compression from weak market conditions • Unplanned outage resulted in lost sales volume and higher maintenance expense Expect Q3 2025 EBIT modestly above breakeven levels Chemical Intermediates 9 $M 2Q25 2Q24 1Q25 Revenue 463 515 545 EBIT -30 22 19 EBIT margin -6.5% 4.3% 3.5% Revenue change % Total Vol / Mix Price FX 2Q25 vs 2Q24 -10 -5 -5 0 2Q25 vs 1Q25 -15 -14 -2 1 Tailwinds: • Cost and volume tailwinds from lack of an unplanned outage • Spread improvement from lower raw material and energy costs • Cost-reduction initiatives Headwinds: • Continued weak commodity market fundamentals 3Q 2025 sequential outlook
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1Q20 2Q25 - 100 200 300 400 500 600 700 800 900 1,000 2026 2027 2028 2029 2033 2034 2042 2044 Eastman is in a strong financial position to effectively navigate an uncertain environment • Expect to deliver ~$1 billion of operating cash flow in FY 2025 • FY 2025 capital expenditures ~$550 million Track record of strong operating cash flow in any environment Manageable public debt maturities* Significantly improved financial position since COVID • Manageable maturity schedule enables us flexibility to refinance maturing debt • Access to significant sources of liquidity, including a $1.5 billion revolving credit facility • Reduced net debt by ~$1 billion since the start of COVID • Solid investment grade credit rating $- $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 $1,800 2019 2020 2021 2022 2023 2024 2025F * 2026 debt maturity is denominated in Euros In millions In millions Net Debt ($B) 10
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With heightened uncertainty, we are focused on what we can control Focused on controllables 11 Sequential headwinds • Mid-single digit volume decline 3Q vs 2Q in specialties driven by trade dispute • Customer and retailer caution negatively impacting volume in key end markets • Modest tariff-related pull-forward in second quarter • Normal seasonal declines • $75M–$100M headwind in 2H25 from lower asset utilization to reduce inventories, with ~$50M in 3Q25 Expect 3Q25 EPS around $1.25 Expect FY25 operating cash flow ~$1 billion • Emphasizing cash generation in uncertain environment with every lever in the company • Reducing inventory levels by >$200 million from current levels • Reduced capital expenditures to ~$550 million from $700M– $800M at the beginning of 2025 • On track to achieve ~$75 million cost reduction, net of inflation • Taking actions to mitigate tariff impacts • Around $75 million of incremental EBITDA from Kingsport methanolysis, with around $50 million in Advanced Materials • Stable price-cost in specialties with commercial excellence in defending pricing and share • CI volume recovering with improved operations
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With macroeconomic weakness and uncertainty persisting, we are increasing our focus on improving results 12 Multi-year focus on improving cash flow and disciplined capital allocation • Right-sizing working capital for current market conditions with targeted actions in 2H25 and 2026 • Lowering cap-ex in 2026 versus 2025 to navigate a challenging environment • Evaluating capital efficient options for additional methanolysis capacity as we maximize production from the Kingsport facility • Confident in our dividend and significantly increasing share repurchases in 2026 Significant reduction of our cost structure to strengthen competitiveness Commitment to address underperforming parts of our portfolio • Optimizing and rationalizing underperforming assets • Highest and best owner mindset for underperforming non-core assets • Ethylene to propylene investment to improve earnings by $50M–$100M over the cycle and enhance operating flexibility at Longview, Texas, facility with short payback period • Total cost savings $150M–$175M net of inflation in 2025–2026 • On track to achieve cost savings target of ~$75 million in 2025 • Expanding program to achieve cost savings of additional $75M–$100M in 2026 building on actions taken in 2025
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Appendix 13
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• Foreign currency exchange rates, net of hedging: USD/EUR $1.15 (previously $1.10); CNY/USD 7.20; JPY/USD 150 • Corporate ‘Other’ adjusted Loss Before Interest and Taxes: ~$190 million; previously ~$180 million • Interest expense: ~$205 million; previously ~$200 million • Share repurchases: $100 million; previously $100 million–$200 million FY2025 underlying assumptions and modeling items 14 Updated from prior guidance Unchanged from prior guidance • Brent crude oil: ~$70/barrel • Natural gas prices consistent with recent FY25 Henry Hub average forward curves: ~$3.60/MMBtu • Capital expenditures: ~$550 million • Full-year adjusted effective tax rate: 15%–16% • FY25 Depreciation & Amortization expense: $510 million