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Enabling Technology. Growing Sustainably. Third Quarter 2025 Earnings Presentation
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2 Legal Notices SAFE HARBOR Please note that in this presentation, we may discuss events or results that have not yet occurred or been realized, commonly referred to as forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by or on behalf of the Company. Such discussion and statements will often contain words such as “expect,” “anticipate,” “project,” “will,” “should,” “believe,” “intend,” “plan,” “assume,” “estimate,” “predict,” “seek,” “continue,” “outlook,” “may,” “might,” "aim," “can have,” “likely,” “potential,” “target,” “hope,” “goal,” "priority,” “guidance” or "confident" and variations of such words and similar expressions, and relate in this presentation, without limitation to the benefits expected from the Micromax transaction; pro forma year-end 2025 net debt to adjusted EBITDA ratio; FY 2025 cash flow outlook, including cash interest, cash taxes and net capex; full year 2025 financial guidance for adjusted EBITDA, adjusted earnings per share (EPS) and free cash flow; expected fourth quarter 2025 FX tailwinds; expected record full year 2025; and capital allocation. These projections and statements reflect management's estimates, assumptions and expectations with respect to future events and financial performance and are believed to be reasonable, though are inherently uncertain and difficult to predict. Such projections and statements are based on the assessment of information available as of the current date, and the Company does not undertake any obligations to provide any further updates. Actual results could differ materially from those expressed or implied in the forward-looking statements if one or more of the underlying estimates, assumptions or expectations prove to be inaccurate or are unrealized. Important factors that could cause actual results to differ materially from those suggested by the forward-looking statements include, but are not limited to, the war in Ukraine, the Israel-Hamas conflict and other hostilities in the Middle-East as well as actions in response thereto and their impact on market conditions and the global economy; increases in tariffs and/or imposition of new tariffs and other changes in trade policy, in the U.S. and other countries, and other economic factors that may affect cost structure and demand; capital requirements and need for and availability of financing; the impact of government regulations on our ability to conduct operations; the impact of new accounting standards and accounting changes; dividend policy and dividend declarations; hedging activities; timing and outcome of environmental and legal matters; the impact of tax planning strategies, assessments and settlements; the impact of changes to privacy, cybersecurity, environmental, global trade, tax and other governmental regulations; impairments, including those on goodwill and other intangible assets; market volatility, including as a result of tariff uncertainty; price and cost environment; inflation and fluctuations in foreign exchange rates; the Company's liquidity, cash flows and capital allocation; funding sources; capital expenditures; debt and debt leverage ratio; shares repurchases; debt and/or equity issuance or retirement; expected returns to stockholders; and the impact of acquisitions, divestitures, restructurings, refinancings, impairments and other unusual items, including the Company's ability to integrate and obtain the anticipated benefits, results and synergies from these items or other related strategic initiatives. Additional information concerning these and other factors that could cause actual results to vary is, or will be, included in the Company's periodic and other reports filed with the Securities and Exchange Commission. The Company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. This presentation also includes FY 2025 free cash flow outlook. This data is provided for informational purposes only and is not necessarily, and should not be assumed to be, an indication of the results that may be achieved in the future. NON-GAAP FINANCIAL MEASURES To supplement the financial measures prepared in accordance with generally accepted accounting principles in the United States (“GAAP”), the Company presents in this presentation the following non-GAAP financial measures: EBITDA, adjusted EBITDA, adjusted EBITDA growth (including growth excluding the Graphics business), adjusted EBITDA margin (including margin excluding pass-though metals), adjusted EPS, adjusted common shares outstanding, free cash flow, adjusted free cash flow, net debt to adjusted EBITDA ratio, and full year 2025 guidance for adjusted EBITDA, adjusted EPS and free cash flow. The Company also evaluates and presents its results of operations on a constant currency basis. The definitions and reconciliations of these non-GAAP measures to the most directly comparable financial measures calculated and presented in accordance with GAAP can be found in the footnotes and appendix of this presentation and in the Company’s earnings release dated October 28, 2025 (the “Release”), a copy of which can be found on the Company’s website at www.elementsolutionsinc.com. This presentation should be read in conjunction with the Release. Management internally reviews each of these non-GAAP measures to evaluate performance on a comparative period-to-period basis in terms of absolute performance, trends and expected future performance of the Company’s businesses and believes that these non-GAAP measures provide investors with an additional perspective on trends and underlying operating results on a period-to-period comparable basis. The Company also believes that investors find this information helpful in understanding the ongoing performance of its operations separate from items that may have a disproportionate positive or negative impact on its financial results in any particular period. These non-GAAP financial measures, however, have limitations as analytical tools, and should not be considered in isolation from, a substitute for, or superior to, the related financial information that the Company reports in accordance with GAAP. Investors are encouraged to review the reconciliations of these non-GAAP financial measures to their most comparable GAAP financial measures included herein and in the Release, and not to rely on any single financial measure to evaluate the Company’s businesses.
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3 Third Quarter Highlights ▪ ▪ Creates ~$2 billion market-leading Electronics performance technology portfolio ▪ High-performance applications built on complementary technical service, applications development and manufacturing capabilities ▪ On a full year basis, would expect Micromax to contribute ~$40 million to ESI’s adjusted EBITDA based on projected 2025 results* ▪ Assuming a $500M purchase price, PF leverage ratio* would be 2.5x at year end1 ▪ Transaction expected to close in Q1’262 Accretive, value-enhancing acquisition of complementary high-performance Electronics paste and inks business ▪ Record quarterly adjusted EBITDA* ▪ 10% like-for-like adjusted EBITDA* growth year over year ▪ 28% ex-metal adjusted EBITDA* margin ▪ $84M of Adjusted Free Cash Flow* Operational Excellence Prudent Capital Allocation * These financial measures, on this slide and on subsequent slides, are not prepared in accordance with GAAP. For definitions , discussions of adjustments and reconciliations, please refer to the footnotes and appendix of this presentation. 1. Pro forma calculation assumes net debt at 12/31/25 of $965M + expected $500M incremental net debt from Micromax transactio n divided by ($548M of expected EBITDA at midpoint of FY25 guidance range plus expected $40M contribution from Micromax on a full year basis in 2025) 2. Subject to certain regulatory approvals and customer closing conditions
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4 Third Quarter 2025 Financial Results Note: Totals may not sum due to rounding or due to varying sizes of the two reportable segments * See non-GAAP definitions and reconciliations in the appendix 1. Assumes that the Graphics transaction had closed on January 1, 2024. The Graphics business was divested on February 28, 2025 2. Calculation for adjusted EBITDA* margin excluding net sales form Assembly pass -through metals is $147 million in adjusted EBITDA* divided by ($656 million net sales less $125 million metals net sales) in Q3 2025 and $143 million in adjusted EBITDA* divided by ($645 million net sales less $109 million metals net sales) in Q3 2024. Constant Currency* Organic* ($ in millions) Q3 2025 Q3 2024 YoY YoY YoY Net Sales $656 $645 2% 0% 5% Electronics 465 419 11% 10% 7% Industrial & Specialty 191 226 (16)% (17)% 0% Diluted EPS $0.16 $0.17 Adjusted EBITDA* $147 $143 3% 1% % margin 22.4% 22.1% 30 bps 20 bps Electronics 102 99 3% 1% % margin 21.8% 23.5% (170) bps (180) bps Industrial & Specialty 45 44 3% 1% % margin 23.7% 19.5% 420 bps 430 bps Adjusted EPS* $0.41 $0.39 5% • Organic net sales* increased 5% year-over-year led by Electronics organic growth* of 7% o 6th straight quarter of high single-digit Electronics segment organic growth* o Industrial & Specialty sales relatively flat organically* though underlying industrial surface treatment volume grew in the quarter • Excluding impact of the Graphics divestiture, adjusted EBITDA growth* would have been 10% for ESI1 o Excluding net sales from Assembly pass-through metals ($125 million), adjusted EBITDA* margin would have been 28%2 vs 27% in Q3’2024 • Adjusted EPS* increase of 5% despite sale of Graphics business
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5 Third Quarter 2025 Segment Details Electronics Industrial & Specialty Note: Totals may not sum due to rounding *See non-GAAP definitions and reconciliations in the appendix Net Sales ($ in millions) Organic Growth* Key Drivers Assembly $238 5% Improved China volumes, strength in high-performance computing end markets Circuitry $138 13% AI and data center investment together with seasonal smart phone ramp Semiconductor $90 5% Growth from advanced packaging solutions partially offset by softer power electronics Total $465 7% Net Sales ($ in millions) Organic Growth* Key Drivers Industrial $165 (2)% Underlying volume growth driven primarily by Asia demand – year over year impacted by Q3 ’24 customer equipment sale Energy $26 22% Production fluid growth from market strength and competitive wins Total $191 0%
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6 Balance Sheet and Cash Flow Considerations Q3 2025 Capital Structure Instrument (in millions) Term Loans $836 Senior Notes due 2028 800 Total Debt $1,636 Cash Balance 594 Net Debt $1,042 Adjusted Shares Outstanding2 244 Market Capitalization3 $6,142 Total Capitalization $7,183 $ millions YTD Q3 2025 FY 2025 Cash Interest $59 ~$65 Cash Taxes $72 $90 - $100 Net Capex* $44 ~$65 Note: Totals may not sum due to rounding * See non-GAAP definitions and reconciliations in the appendix 1. Pro forma calculation assumes net debt at 12/31/25 of $965M + expected $500M incremental net debt from Micromax transactio n divided by ($548M of expected EBITDA at midpoint of FY25 guidance range plus expected $40M contribution from Micromax on a full year basis in 2025) 2. See p.9 for reconciliation to Adjusted Share Counts 3. Based on Element Solutions’ closing stock price of $25.17 at September 30, 2025 Key Cash Flow Items Balance Sheet Management Q3 2025 Cash Flow Uses and FY 2025 Outlook ▪ Q3 2025 adjusted free cash flow* of $84 million o Working capital investment of $22 million driven by higher accounts receivable from sales acceleration and metals inflation impact to inventory o $17 million capex spend driven by growth investments ▪ Net debt to adjusted EBITDA ratio* of 1.9x on an LTM basis as of September 30, 2025 o Capital structure is fully fixed-rate through 2028 ▪ Reflecting proposed Micromax transaction and barring further capital deployment, net debt to adjusted EBITDA ratio* would be 2.5x as of December 31, 20251
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7 Full Year 2025 Financial Guidance Updated as of October 2025 FY Adjusted EPS* Currency FY Adjusted EBITDA* * See non-GAAP definitions and reconciliations in the appendix On track for adjusted EBITDA* above the high-end of initial guidance and a record full year despite Graphics divestment FY Free Cash Flow* Low single-digit million-dollar FX tailwind in Q4 at 9/30 rates Approximately $1.45 $545 million to $550 million Approximately $280 million
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Enabling Technology. Growing Sustainably. Appendix
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9 Reconciliation to Adjusted Share Counts (amounts in millions) Q3 2025 Q3 2024 Basic common shares outstanding 242 242 Number of shares issuable upon vesting of granted Equity Awards1 2 2 Adjusted common shares outstanding 244 245 Note: Totals may not sum due to rounding 1. Equity awards with targets that are considered probable of achievement vested at target level
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10 Net Income Reconciliation to Adjusted EBITDA ($ millions) Q3 2025 Q3 2024 Net income $39 $40 Add (subtract): Income tax expense 16 37 Interest expense, net 13 14 Depreciation expense 10 10 Amortization expense 29 29 EBITDA 107 131 Adjustments to reconcile to Adjusted EBITDA: Restructuring expense (income) 2 (0) Acquisition, integration and transaction expenses 11 6 Foreign exchange losses (gains) on intercompany loans 12 (14) Loss on divestitures 7 — Debt financing costs — 0 Other, net 8 19 Adjusted EBITDA 147 143 Graphics Adjusted EBITDA — 9 Adjusted EBITDA excluding Graphics1 $147 $133 Net income margin % 6.0% 6.3% Adjusted EBITDA margin % 22.4% 22.1% Note: Totals may not sum due to rounding 1. Assumes that the Graphics transaction had closed on January 1, 2024. The Graphics business was divested on February 28, 2025
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11 ($ millions, except per share amounts) Q3 2025 Q3 2024 Net income $39 $40 Net income attributable to non-controlling interests (0) (0) Reversal of amortization expense 29 29 Adjustment to reverse incremental depreciation expense from acquisitions 0 0 Restructuring expense (income) 2 (0) Acquisition, integration and transaction expense 11 6 Foreign exchange losses (gains) on intercompany loans 12 (14) Loss on divestitures 7 — Debt financing costs — 0 Other, net 8 19 Tax effect of pre-tax non-GAAP adjustments (14) (8) Adjustment to estimated effective tax rate 5 21 Adjusted net income $99 $95 Adjusted earnings per share $0.41 $0.39 Adjusted common shares outstanding1 244 245 Note: Totals may not sum due to rounding 1. See p.9 for a reconciliation to Adjusted Share Counts Net Income Reconciliation to Adjusted EPS
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12 Net Debt to Adjusted EBITDA Ratio Reconciliation on a Trailing Twelve Month Basis ($ millions) YTD 2025 Q4 2024 LTM Q3 2025 Net income $185 $55 $240 Add (subtract): Income tax expense 50 12 62 Interest expense, net 41 14 54 Depreciation expense 30 10 39 Amortization expense 84 28 113 EBITDA 389 119 508 Restructuring expense 5 2 7 Acquisition, integration and transaction expense 23 10 33 Foreign exchange losses on intercompany loans 28 0 29 Gain on divestitures (60) — (60) Debt refinancing costs 2 0 2 Other, net 25 (2) 23 Adjusted EBITDA $411 $130 $541 Net Debt $1,042 Net Debt to Net Income Ratio 4.3x Net Debt to Adjusted EBITDA Ratio 1.9x Note: Totals may not sum due to rounding
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13 Organic Net Sales Growth Reconciliation Three Months Ended September 30, 2025 Reported Net Sales Growth Impact of Currency Constant Currency Change in Pass- Through Metals Pricing Divestitures Organic Net Sales Growth Electronics 11% (1)% 10% (2)% —% 7% Industrial & Specialty (16)% (2)% (17)% —% 17% 0% Total 2% (2)% 0% (1)% 6% 5% Note: Totals may not sum due to rounding or due to varying sizes of the two reportable segments
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14 ($ millions) Q3 2025 Q3 2024 FY2025 Outlook Cash flows from operating activities $100 $99 ~$326 Capital expenditures (17) (13) ~(65) Proceeds from disposal of property, plant and equipment 0 — — Adjustments 0 — $19 Adjusted Free Cash Flow $84 $86 ~$280 Note: Totals may not sum due to rounding Adjusted Free Cash Flow Reconciliation
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15 Non-GAAP Definitions Adjusted Earnings Per Share (EPS): Adjusted EPS is a key metric used by management to measure operating performance and trends as management believes the excl usion of certain expenses in calculating adjusted EPS facilitates operating performance comparisons on a period -to-period basis. Adjusted EPS is defined as n et income adjusted to reflect adjustments consistent with the Company’s definition of adjusted EBITDA. Additionally, the Company eliminates amortization expense associated with intangible assets, i ncremental depreciation associated with the step-up of fixed assets and incremental cost of sales associated with the step-up of inventories, as applicable, recognized in purchase accounting for acqui sitions. The resulting adjusted net income is then divided by the Company's adjusted common shares outstanding. Adjusted common shares outstanding represent the shares outstanding as of the balance sh eet date for the quarter-to-date period and an average of each quarter for the year-to-date period, plus shares issuable upon exercise or vesting of all outstanding equity awards (assuming a performa nce achievement target level for equity awards with targets considered probable). The Company uses a non-GAAP effective tax rate of 20%, as described in the Release. This rate, which reflects the Co mpany's estimated long-term expectations for taxes to be paid on its adjusted non-GAAP earnings, is consistent with how management evaluates the Company's financial performance. The Company also b elieves that providing a fixed rate facilitates comparisons of business performance from period to period. This non -GAAP effective tax rate is lower than the average of the statutory tax rat es applicable to the Company's jurisdictional mix of earnings primarily because it reflects tax benefits derived from U.S. tax attribute carryforwards, which consist of operating losses and tax cre dits. Without taking into account these benefits and other similar adjustments, the Company projects its non-GAAP effective tax rate would be 23.7% based on its estimated results for the full year 2025. This rate would have resulted in a $0.05 reduction in Adjusted EPS for the nine months ended September 30, 2025. Constant Currency: The Company discloses net sales and adjusted EBITDA on a constant currency basis by adjusting results to exclude the impact o f changes due to the translation of foreign currencies of its international locations into U.S. dollar. Management believes this non-GAAP financial information facilitates period-to-period comparison in the analysis of trends in business performance, thereby providing valuable supplemental information regarding its results of operations, consistent with how the Company internally e valuates its financial results. The impact of foreign currency translation is calculated by converting the Company's current -period local currency financial results into U.S. dollar using the prior period's exchange rates and comparing these adjusted amounts to its prior period reported results. The difference between actual growth rates and constant currenc y growth rates represents the estimated impact of foreign currency translation. EBITDA and Adjusted EBITDA: EBITDA represents earnings before interest, provision for income taxes, depreciation and amortization. Adjusted EBITDA is def ined as EBITDA, excluding the impact of additional items included in GAAP earnings which the Company believes are not representative or indicative of its ongoing bus iness or are considered to be associated with its capital structure, as described in the Release. Adjusted EBITDA for each segment also includes an allocation of corporate costs, such as compensati on expense and professional fees. Management believes adjusted EBITDA and adjusted EBITDA margin provide investors with a more complete understanding of the long -term profitability trends of the Com pany’s business and facilitate comparisons of its profitability to prior and future periods. However, these measures, which do not consider certain cash requirements, should not be construed as an alter native to net income or cash flows from operations as a measure of profitability or liquidity. Net Debt to Net Income and Net Debt to Adjusted EBITDA Ratios : Net debt is a non-GAAP measure and is comprised of total debt (current installments of long -term debt, revolving credit facilities and long-term debt), excluding unamortized discounts and debt issuance costs, which totaled $11.0 million at September 30, 2025, less cash. For the non-GAAP reconciliation of Net debt, please refer to the "Q3 2025 Capital Structure" table on page 6. Net debt to net income ratio and net debt to adjusted EBITDA ratio is net debt divided by net income and adjusted EBITDA, r espectively. Free Cash Flow and Adjusted Free Cash Flow: Free cash flow is defined as net cash flows from operating activities less net capital expenditures. Adjusted free cash flow for 3 and 9 months ended Sept 30, 2025 is defined as net cash flows from operating activities less (1) net capital expenditures, (2) non -recurring payments associated with a multi-year tax settlement and (3) professional fees, non - recurring expenses and taxes paid in association with the sale of MacDermid Graphics Solutions. Net capital expenditures incl ude capital expenditures less proceeds from the disposal of property, plant and equipment. Management believes that free cash flow, which measure the Company’s ability to generate cash from its busine ss operations, is an important financial measure for evaluating the Company's liquidity. Free cash flow and adjusted free cash flow should be considered as additional measures of liquidity to, rather than as substitutes for, net cash provided by operating activities. Organic Net Sales Growth: Organic net sales growth is defined as net sales excluding the impact of foreign currency translation, changes due to the pas s-through pricing of certain metals and acquisitions and/ or divestitures, as applicable. Management believes this non -GAAP financial measure provides investors with a more complete understanding of the underlying net sales trends by providing comparable net sales over differing periods on a consistent basis. For the three months ended September 30, 2025, Electronics' consolidated results were positively impacted by $9.2 million of pass-through metals pricing and Industrial & Specialty’s consolidated results were negatively impacted by $38.9 million of divestitures. ***************************************************************************************************************************** **************************************************************************************************** The Company provides financial guidance with respect to adjusted EBITDA and adjusted EPS on a non -GAAP basis only. Reconciliations of such forward looking non GAAP measures to GAAP are excluded in reliance upon the exception provided by Item 10(e)(1)(i)(B) of Regulation S-K due to the inherent difficulty in forecasting and quantifying, without unreasonable efforts, certain amou nts that are necessary for such reconciliations, including adjustments that could be made for restructurings, refinancings, impairments, d ivestitures, integration and acquisition related expenses, share -based compensation amounts, non-recurring, unusual or unanticipated charges, expenses or gains, adjustments to inventory and other cha rges reflected in its reconciliation of historic numbers, the amount of which, based on historical experience, could be significant.