Ashland Inc. (ASH) 2017 Q1 法說會逐字稿

Good day, ladies and gentlemen, and welcome to the Ashland Global Holdings first-quarter earnings call.

各位女士、先生，大家好，歡迎參加 Ashland Global Holdings 第一季財報電話會議。

(Operator Instructions)

（接線員指示）

As a reminder, this call may be recorded.

提醒各位，本次電話會議可能會被錄音。

I would now like to introduce your host for today's conference, Mr. Seth Mrozek, Director of Investor Relations. Please go ahead, sir.

現在我想介紹今天會議的主持人：投資人關係總監 Seth Mrozek 先生。先生，請開始。

Thank you, Kristy. Good morning, everyone, and welcome to Ashland's first-quarter fiscal 2017 earnings conference call and webcast. My name is Seth Mrozek, Director, Ashland Investor Relations. Joining me on the call today are Bill Wulfsohn, Ashland's Chairman and Chief Executive Officer; Kevin Willis, Senior Vice President and Chief Financial Officer; and Luis Fernandez-Moreno, Senior Vice President of Ashland and President of the Chemicals Group, which includes Ashland Specialty Ingredients and Ashland Performance Materials.

謝謝你，Kristy。各位早安，歡迎參加 Ashland 2017 財政年度第一季財報電話會議與網路直播。我叫 Seth Mrozek，Ashland 投資人關係總監。今天與我一同參與電話會議的有：Ashland 董事長兼執行長 Bill Wulfsohn；資深副總裁兼財務長 Kevin Willis；以及 Ashland 資深副總裁、化學品事業群總裁 Luis Fernandez-Moreno。化學品事業群包含 Ashland Specialty Ingredients 與 Ashland Performance Materials。

We released preliminary results for the quarter ended December 31, 2016, at approximately 5:00 PM Eastern Time yesterday, January 26. Additionally, we posted slides and prepared remarks to our website, ashland.com, under the Investor Relations section, and have furnished each of these documents to the SEC in a Form 8-K.

我們已於昨日 1 月 26 日美東時間約下午 5:00，發布截至 2016 年 12 月 31 日止季度的初步結果。此外，我們也在網站 ashland.com 的「投資人關係」專區上傳簡報與預先準備的講稿，並已以 Form 8-K 向美國證券交易委員會（SEC）提交上述各項文件。

As a reminder, some of the matters discussed today and included in our presentations may include forward-looking statements, as such term is defined under US securities law. We believe any such statements are based on reasonable assumptions but cannot assure that such expectations will be achieved. Please also note that we will be discussing adjusted results during this call. We believe this enhances the understanding of our performance by more accurately reflecting our ongoing business. With that, I will turn the call over to Bill. Bill?

提醒各位，今天討論的部分事項以及我們簡報中所包含的內容，可能包含依美國證券法定義之「前瞻性陳述」。我們相信任何此類陳述係基於合理假設，但無法保證相關預期一定能達成。也請注意，我們在本次電話會議中將討論調整後（adjusted）結果。我們認為這有助於更準確反映我們持續經營業務，從而增進對公司表現的理解。接下來我將把電話會議交給 Bill。Bill？

Thank you, Seth, and good morning, everyone. This is really an exciting time for us as the final and full separation of Valvoline is just a few months away. We remain on track and we expect the distribution to Ashland shareholders of the Ashland-owned shares of Valvoline to occur following the release of our March quarter earnings.

謝謝你，Seth，各位早安。對我們而言，這確實是一個令人振奮的時刻，因為 Valvoline 的最終且完整分拆只剩下幾個月。我們仍按計畫推進，並預期在發布我們 3 月季度財報後，將把 Ashland 所持有的 Valvoline 股份分配給 Ashland 股東。

This action represents the culmination of a tremendous amount of work and teamwork by the respective Ashland and Valvoline teams over the last 16 months. Most importantly, it paves the way for the two great companies, both the new Ashland and Valvoline, to reach their full potential by pursuing the shareholder value creation, financial and operating strategies that fit their distinct business and investor profiles. For the new Ashland, that means we will be expanding our operating focus and discipline to achieve the full potential as the premiere specialty chemicals company.

此項行動代表過去 16 個月間 Ashland 與 Valvoline 各自團隊投入大量工作與協作的成果。更重要的是，這為兩家優秀公司——全新的 Ashland 與 Valvoline——鋪路，使其能依各自不同的業務與投資人輪廓，採取最適合的股東價值創造、財務與營運策略，以充分發揮潛力。對新的 Ashland 而言，這意味著我們將擴大營運聚焦與紀律，以實現作為頂尖特用化學品公司的全部潛力。

Later in the call, I will speak to our objectives and actions that we are taking to achieve this aspiration. However, before then, I would like to turn the focus of the call to our FY17 Q1 financial results. As explained on our last quarterly earnings call, our FY17 business plan targeted a return to mid-single-digit revenue and EBITDA growth within ASI. To that end, in Q1, ASI is off to a solid start. Led by the industrial team, ASI delivered sales volume and adjusted EBITDA growth.

在稍後的電話會議中，我將談到我們為達成此一願景所設定的目標與正在採取的行動。不過在此之前，我想先把本次電話會議的重點放在 2017 財年第一季的財務結果。如同我們在上一季財報電話會議中所說明，我們的 2017 財年營運計畫目標，是讓 ASI 的營收與 EBITDA 回到中個位數成長。為此，第一季 ASI 有一個穩健的開局。在工業團隊帶動下，ASI 實現了銷售量與調整後 EBITDA 的成長。

While we, like many others, encountered some inflationary raw material and also FX dynamics in the quarter, the ASI team took actions to offset and deliver results which were consistent with the outlook we presented in November. Moving to APM, their adjusted earnings, while down from the prior year, exceeded our expectations. This result was led by strong composites volume growth. I&S, while down year over year, took important steps to stabilize margins by pushing through price increases which are beginning to take effect this quarter.

雖然我們和許多公司一樣，在本季遇到部分原物料通膨以及匯率（FX）變動的影響，但 ASI 團隊採取行動加以抵銷，並交出與我們 11 月所提出展望一致的結果。至於 APM，其調整後獲利雖較去年同期下滑，但仍優於我們的預期。此結果主要由複合材料（composites）強勁的銷量成長所帶動。I&S 雖然年對年下滑，但透過推動漲價以穩定毛利率，並且這些漲價已開始在本季逐步反映。

Based upon these trends and the trends we have seen in the market, combined with the actions we are taking, we are confident to reaffirm our previously communicated outlook for ASI and APM for the remainder of FY17. Luis will speak more specifically to the results of the Chemicals business in a few minutes.

基於上述趨勢與我們在市場上觀察到的趨勢，再加上我們正在採取的行動，我們有信心重申先前對 ASI 與 APM 在 2017 財年剩餘期間的既有展望。Luis 將在幾分鐘後更具體說明化學品業務的表現。

As for Valvoline, while we won't speak much of their results on this call, but instead encourage you to reference their release materials, the Valvoline team delivered another strong quarter and is off to a great start to their first fiscal year as an independent public company.

至於 Valvoline，我們在本次電話會議中不會花太多時間討論其結果，而是建議各位參考他們的新聞稿與相關資料；Valvoline 團隊本季再度交出強勁表現，並在其作為獨立上市公司之第一個財政年度取得良好開局。

As I mentioned, later in the call, I will speak to additional actions we are taking to accelerate growth, margins, and cash conversion, and also share some comments regarding our focused capital allocation strategy to enhance investor returns. But I would first like to turn the call over to Kevin and Luis to discuss Ashland's overall results for the first quarter. Kevin?

如我所提到，稍後我將談到我們為加速成長、提升利潤率與現金轉換所採取的其他行動，並分享我們聚焦的資本配置策略之相關看法，以提升投資人報酬。但首先，我想把電話會議交給 Kevin 與 Luis，請他們說明 Ashland 第一季的整體結果。Kevin？

Thank you, Bill, and good morning, everyone. In the quarter, we reported a GAAP loss from continuing operations attributable to Ashland of $0.01 per diluted share. When adjusted for key items, earnings per share were $1.16 and adjusted EBITDA was $215 million. While these amounts are below the prior year, they do not include the Valvoline net income attributable to Ashland's non-controlling 17% interest which equaled $0.17 per year-ago diluted share and $21 million of adjusted EBITDA.

謝謝你，Bill，各位早安。本季我們報告的 GAAP 持續經營業務歸屬於 Ashland 的每股稀釋虧損為 0.01 美元。在針對關鍵項目調整後，每股盈餘為 1.16 美元，調整後 EBITDA 為 2.15 億美元。雖然這些數字低於去年同期，但其中未包含 Valvoline 歸屬於 Ashland 之非控股 17% 權益的淨利；該部分相當於去年同期每股稀釋 0.17 美元，以及 2,100 萬美元的調整後 EBITDA。

As Bill just mentioned, ASI delivered sales volume and adjusted EBITDA growth, and overall APM results exceeded our expectations as the composites team delivered strong volume growth. In addition, Valvoline segment income grew year over year in what was another strong quarter. In total, the results in Q1 represent a solid start to the year. Luis will spend more time discussing the Chemical segment results in a few minutes.

如 Bill 剛才提到，ASI 實現了銷售量與調整後 EBITDA 的成長；而整體 APM 的結果也優於我們預期，因為複合材料團隊帶來強勁的銷量成長。此外，Valvoline 事業部的部門收益年對年成長，延續另一個強勁季度。總體而言，第一季的結果代表本年度有一個穩健的開局。Luis 將在幾分鐘後花更多時間說明化學品事業部的結果。

Turning to the balance sheet, we continued to pay down debt during the quarter. Through a number of actions, including a cash tender offer and open market transactions, Ashland, excluding Valvoline, reduced book debt by an additional $309 million. As a result, we are reducing our expectations for Ashland-only net interest expense in FY17 to $120 million to $130 million. Ashland's liquidity remains strong. As of December 31, we had cash and borrowing capacity of nearly $1.3 billion.

接著看資產負債表，我們在本季持續償還債務。透過多項行動（包括現金要約收購以及公開市場交易），Ashland（不含 Valvoline）進一步將帳面債務再減少 3.09 億美元。因此，我們將 2017 財年僅 Ashland 的淨利息費用預期下修至 1.2 億至 1.3 億美元。Ashland 的流動性仍然強勁。截至 12 月 31 日，我們的現金與可動用借款額度合計接近 13 億美元。

Overall, we've made good progress on the balance sheet over the past few months, consistent with the objectives we laid out as part of the Valvoline separation. Our effective tax rate adjusted for key items in the December quarter was 30%. This rate was higher than we expected and reflects regional sales mix. We continue to expect that Ashland's tax rate, excluding Valvoline, will be in the range of 10% to 15% in FY17.

整體而言，過去幾個月我們在資產負債表方面已取得良好進展，符合我們在 Valvoline 分拆計畫中所提出的目標。12 月季度在針對關鍵項目調整後的有效稅率為 30%。此稅率高於我們預期，反映了區域銷售組合的影響。我們仍預期 2017 財年 Ashland 的稅率（不含 Valvoline）將落在 10% 至 15% 的區間。

From a cash flow perspective, I continue to be pleased with our cash generating capabilities. While we had a net free cash outflow of $31 million in the December quarter, this is consistent with the typical season patterns of working capital within the Chemicals segment and the expected nonrecurring payments related to the Valvoline separation, which amounted to $45 million during the quarter. For the year, excluding Valvoline, we continue to expect Ashland free cash flow to be in the range of $110 million to $120 million. This includes those nonrecurring payments.

從現金流的角度來看，我仍然對我們的現金創造能力感到滿意。雖然我們在12月季度的淨自由現金流出為3,100萬美元，但這與化學品事業部營運資金的典型季節性模式一致，並且也符合與Valvoline分拆相關的預期一次性付款；該等付款在本季度合計為4,500萬美元。就全年而言，剔除Valvoline後，我們仍預期Ashland自由現金流將落在1.10億至1.20億美元的區間。此金額包含上述一次性付款。

Before I turn the call over to Luis, I want to reiterate our plans and outlook for the year. As we stated in November, subject to market conditions and other factors, we presently intend to distribute the remaining Valvoline Incorporated shares this spring, following the release of March quarter earnings results by both Ashland and Valvoline, respectively. As we also stated in November, each quarter we plan to update the full-year EBITDA expectations for both ASI and APM.

在我把電話會議交給Luis之前，我想重申我們今年的計畫與展望。如同我們在11月所述，在市場狀況及其他因素允許下，我們目前打算於今年春季分配剩餘的Valvoline Incorporated股份，時間點將在Ashland與Valvoline分別公布3月季度財報之後。我們也在11月提到，我們計畫每一季更新ASI與APM兩者的全年EBITDA預期。

We continue to expect ASI to deliver mid-single-digit EBITDA growth and our full-year EBITDA ranges for both ASI and APM remain unchanged. It is also worth noting that in the March quarter, we will continue to consolidate Valvoline results consistent with the reporting practice since the IPO. This means that any net pension and post-retirement related income from Valvoline, which we estimate to be approximately $17 million in the March quarter, will be reported under Ashland's corporate unallocated and other caption.

我們仍預期ASI可實現中個位數的EBITDA成長，而ASI與APM兩者的全年EBITDA區間維持不變。另外值得注意的是，在3月季度，我們將持續依照自IPO以來的報導慣例合併Valvoline的業績。這表示，任何來自Valvoline的淨退休金及退休後福利相關收益（我們估計3月季度約為1,700萬美元）將列示於Ashland的「公司未分攤及其他」項下。

We're off to a solid start this year and continue to have confidence in our full-year outlook. I will now turn the call over to Luis for his comments about the Chemicals segments during the quarter. Luis?

我們今年開局穩健，並持續對全年展望有信心。我現在把電話會議交給Luis，請他就本季度化學品事業部的表現發表評論。Luis？

Thank you, Kevin, and good morning, everyone. This morning, I would like to start with the Specialty Ingredients results during the quarter. We are pleased with the continued progress towards profitable growth. Sales were up 1%, to $482 million, and volumes rose 6% when compared to the prior year. Furthermore, adjusted EBITDA grew by 1%, to $95 million.

謝謝你，Kevin，各位早安。今天早上，我想先從本季度Specialty Ingredients的業績談起。我們對朝向獲利性成長的持續進展感到滿意。銷售額成長1%至4.82億美元，與去年同期相比，銷量成長6%。此外，調整後EBITDA成長1%至9,500萬美元。

These results were driven by a strong execution by our Industrial Specialties team, which drove growth across all industrial end markets. Coatings, adhesives, performance specialties, construction, and energy all showed positive gains. In total, industrial sales grew by 6% and volumes grew by 9% compared to the prior year. Our Consumer Specialties team also drove growth in a number of our key end markets, including oral care and hair care.

這些結果主要來自我們Industrial Specialties團隊的強勁執行力，帶動所有工業終端市場的成長。塗料、黏著劑、性能特用化學品、建築與能源皆呈現正向增長。整體而言，工業銷售額較去年同期成長6%，銷量成長9%。我們的Consumer Specialties團隊也在多個關鍵終端市場帶動成長，包括口腔護理與護髮。

Results with our pharma customers were consistent with the strong year-ago period. These gains were offset by lower sales into the skin care market where we continued to proactively manage our exposure to lower-margin sunscreens. In total, consumer volumes declined by 2% compared to the prior year. Sales declined 3%, largely due to mix within the product portfolio, pricing, and the impact of foreign currency fluctuations.

我們與製藥客戶的業績與去年同期的強勁表現一致。這些增長被護膚市場的較低銷售所抵銷，因為我們持續主動管理對低毛利防曬產品的曝險。整體而言，消費品銷量較去年同期下滑2%。銷售額下滑3%，主要原因為產品組合、定價，以及外幣匯率波動的影響。

On the topic of foreign currency, we did see some FX movement during the quarter after the November earnings release, especially in the Europe and the Chinese RMB. However, due to the impact of our overall commercial excellence initiatives, we were able to deliver EBITDA growth consistent with our expectations.

談到外幣，本季度在11月財報發布後，我們確實看到一些匯率變動，尤其是在歐洲與中國人民幣。然而，受惠於我們整體商業卓越（commercial excellence）計畫的影響，我們仍能實現符合預期的EBITDA成長。

During the quarter, we began to see the beginnings of a new inflationary raw material environment, particularly for crude-driven raw materials. We always work actively to offset the impact of rising raw material costs and this quarter was no different. To this end, as you may recall over the past several months, we have announced price increases across many of our product lines and end markets. These price increases are part of our strategy to better capture the value we are delivering to our customers, in addition to offsetting the raw material inflation we have seen.

本季度，我們開始看到新的原物料通膨環境的初步跡象，特別是原油驅動的原物料。我們一向積極因應以抵銷原物料成本上升的影響，本季度也不例外。為此，如各位可能記得，過去幾個月我們已在多條產品線與多個終端市場宣布調漲價格。這些漲價是我們策略的一部分，目的在於更充分反映我們為客戶創造的價值，同時也用以抵銷我們所見到的原物料通膨。

Turning to our outlook, as Kevin mentioned, I would like to share some insight into our current thinking for FY17. We expect that ASI will continue the trend towards improving growth and profitability throughout the remainder of the year. We expect to leverage our leading technology positions across our core end markets and introduce new products to help our customers win in the marketplace.

接著談展望，如Kevin所提，我想分享我們目前對FY17的一些看法。我們預期ASI在今年剩餘期間將延續改善成長與獲利能力的趨勢。我們預期將運用在核心終端市場的領先技術地位，並推出新產品，協助客戶在市場上取得勝利。

We also expect to continue to keep our fixed costs in check while leveraging our commercial excellence initiatives to offset the recent unfavorable trends in foreign currency and raw materials. For this year, we continue to expect adjusted EBITDA to be in the range of $480 million to $510 million, with similar seasonal patterns to 2016. This outlook is unchanged from the outlook we provided in November. For the second quarter of FY17, we expect sales to be in the range of $530 million to $545 million and adjusted EBITDA margin to be in the range of 24% to 25%.

我們也預期將持續控制固定成本，同時運用商業卓越計畫來抵銷近期外幣與原物料的不利趨勢。今年我們仍預期調整後EBITDA將落在4.80億至5.10億美元區間，季節性模式與2016年相近。此展望與我們在11月提供的展望一致，未有變動。就FY17第二季而言，我們預期銷售額將落在5.30億至5.45億美元區間，調整後EBITDA利潤率將落在24%至25%區間。

Turning now to Performance Materials, adjusted EBITDA declined to $21 million in the quarter. This decline was driven almost entirely by intermediates and solvents pricing and the impact of the planned catalyst change at our BDO facility in the US.

接著談Performance Materials，本季度調整後EBITDA下滑至2,100萬美元。此下滑幾乎完全由中間體與溶劑的定價，以及我們在美國BDO工廠進行計畫性觸媒更換所帶來的影響所致。

Composites had a strong quarter, where the volumes grew by 7% and sales were consistent with the prior year. As with ASI, prices for key raw materials began to rise during the quarter, which resulted in some margin compression. While we are typically able to recover the impact of rising raw material prices, there is roughly a three-month lag in timing of the pass-through. As I mentioned, intermediates and solvents results were well below prior year, reflecting the expected lower BDO and the reduced pricing.

Composites本季度表現強勁，銷量成長7%，銷售額與去年同期持平。與ASI相同，關鍵原物料價格在本季度開始上升，導致利潤率受到一些擠壓。雖然我們通常能回收原物料價格上升的影響，但價格轉嫁在時間上約有三個月的落後。如我所提，中間體與溶劑的業績遠低於去年同期，反映了預期中的較低BDO以及較低的定價。

Volumes declined by 3% and sales declined by 14%, reflecting this lower pricing. The results also reflect the incremental $9 million of costs associated with the Lima catalyst change, which needs to occur once every four to five years. On a sequential basis, in the first quarter, we began to see the impact of recent BDO price increases as announced by both Ashland and other producers. And while the reduced prices continued to decline through the first quarter, prices appear to have stabilized more recently.

銷量下滑3%，銷售額下滑14%，反映了較低的定價。業績也反映了與Lima觸媒更換相關的額外900萬美元成本；此更換每四到五年需要進行一次。就環比而言，在第一季，我們開始看到近期BDO漲價的影響，該漲價由Ashland及其他生產商共同宣布。雖然較低的價格在第一季期間仍持續下滑，但近期價格似乎已趨於穩定。

Turn now to the outlook for APM for the full-year. We continue to expect APM adjusted EBITDA in the range of $95 million to $105 million. As with ASI, this outlook is unchanged from what we communicated in November. For the second quarter of FY17, we expect APM sales to be in the range of $230 million to $250 million, with adjusted EBITDA margin to be in the range of 9.5% to 10.5%. With that, I'll turn the call back over to Bill for his closing thoughts. Bill?

接著談APM的全年展望。我們仍預期APM調整後EBITDA將落在9,500萬至1.05億美元區間。與ASI相同，此展望與我們在11月所溝通的內容一致，未有變動。就FY17第二季而言，我們預期APM銷售額將落在2.30億至2.50億美元區間，調整後EBITDA利潤率將落在9.5%至10.5%區間。接下來，我把電話會議交回給Bill，請他做最後的總結。Bill？

Thank you, Luis. With the planned final separation of Valvoline just a few months away, the entire new Ashland organization is squarely focused on delivering against our 2017 plan and positioning the Company for more profitable growth as a pure-play specialty chemical company. As I mentioned at the beginning of the call, in addition to completing the Valvoline separation, Ashland has two core priorities for the year ahead.

謝謝你，Luis。隨著Valvoline計畫中的最終分拆僅剩幾個月，嶄新的Ashland整個組織正全力聚焦於落實我們的2017年計畫，並將公司定位為一家純粹的特用化學品公司，以實現更具獲利性的成長。如同我在電話會議一開始提到的，除了完成Valvoline分拆之外，Ashland在接下來一年還有兩項核心優先事項。

The first will be to deliver on this plan and that includes mid-single-digit EBITDA growth within ASI, stabilizing prices within I&S, and also taking aggressive actions to reduce year-over-year SG&A through the previously announced cost-savings initiatives. Also, as you've heard, we are off to a solid start for FY17, and with that, our outlook remains unchanged for the fiscal year.

第一項是交付這項計畫，其中包括ASI的EBITDA中個位數百分比成長、I&S的價格穩定，以及透過先前公布的成本節省方案，採取積極行動降低年對年SG&A。另外，如各位所聽到的，我們在FY17有一個穩健的開局，因此我們對本會計年度的展望維持不變。

Our second core investor priority for FY17 is to pivot Ashland to become the leading premiere specialty chemical company. Crucial to achieving this objective is to achieve top-quartile EBITDA margins and growth in excess of GDP. In the quarter, ASI took an important first step in its return to profitable growth. But to accelerate our progress, our formula here is straightforward. Customer intimacy and innovation is essential to our success. And to that end, we have launched a multifunctional engagement team, and that team is tasked with increasing ASI sales from new products by expanding the size of our innovation pipeline and accelerating the rate at which we are commercializing those new technologies.

我們FY17的第二項核心投資人優先事項，是推動Ashland轉型成為領先的頂尖特用化學品公司。達成此目標的關鍵，是實現前四分位的EBITDA利潤率，以及高於GDP的成長。本季，ASI在重返獲利性成長方面邁出了重要的第一步。但為了加速進展，我們的做法很直接。客戶緊密合作與創新對我們的成功至關重要。為此，我們已成立一個多功能的客戶互動團隊，該團隊的任務是透過擴大創新管線規模並加快新技術商業化速度，提升ASI來自新產品的銷售。

Another core element is to capture the value we bring to our customers and extend our journey to true commercial excellence. We continue with internal efforts with a focused price-to-value initiative, which is led by our new commercial leaders, and is leveraging new approaches from external experts and we're beginning to see some benefits from this important initiative.

另一個核心要素，是擷取我們為客戶帶來的價值，並延伸我們邁向真正商業卓越的旅程。我們持續推動內部工作，聚焦於「以價值定價」的倡議；該倡議由我們新的商務領導團隊主導，並運用外部專家的新方法，我們也開始看到這項重要倡議帶來的一些效益。

Lastly, to ensure we have leading EBITDA margins, we need to drive cost competitiveness and continued overhead efficiencies. In this area, as our results in the first quarter indicate, we are executing on the plan and we continue to maintain cost discipline across the Company.

最後，為了確保我們擁有領先的EBITDA利潤率，我們需要推動成本競爭力與持續的間接費用效率提升。在這方面，如第一季的結果所示，我們正在執行計畫，並持續在全公司維持成本紀律。

In addition, to be the premiere specialty chemical company we envision, we must also ensure that our profitable growth leads to effective cash conversion and that cash is deployed to create shareholder value. As Kevin discussed during the quarter, Ashland reduced its debt by more than $300 million, which further reduces our annual interest expense and gives us greater financial flexibility for the future.

此外，若要成為我們所期望的頂尖特用化學品公司，我們也必須確保獲利性成長能帶來有效的現金轉換，並將現金用於創造股東價值。如Kevin在本季所討論，Ashland已將負債降低超過3億美元，進一步降低我們的年度利息費用，並為未來提供更大的財務彈性。

We believe the potential for growing our strong cash conversion for the new Ashland is significant and are confident that the actions we are taking will accelerate our results in these important areas. As we move to become a more focused specialty chemical company, we have also refined our targeted metrics and capital allocation strategies.

我們相信，新Ashland提升強勁現金轉換能力的潛力相當可觀，並有信心我們正在採取的行動將加速在這些重要領域的成果。隨著我們轉型成為更聚焦的特用化學品公司，我們也精煉了目標衡量指標與資本配置策略。

It's difficult to explain the comprehensive nature of our forward plans and value-creating capital allocation strategies on a conference call. And as such, we have scheduled an investor day for the morning of May 1 at the JW Marriott Essex House in New York City. We look forward to discussing Ashland's strategy metrics and financial outlooks in greater detail at that session. We will share more details about the event as we get closer to the date.

在電話會議中很難完整說明我們前瞻計畫與創造價值的資本配置策略之全面性。因此，我們已安排於5月1日上午在紐約市JW Marriott Essex House舉辦投資人日。我們期待在該場次更詳細地討論Ashland的策略指標與財務展望。隨著日期接近，我們將分享更多活動細節。

In closing, we are excited about the separation into two great companies, on time, as expected, and we believe that this will enable the new Ashland to pivot its focus to driving the operating and financial imperatives which are necessary to realize its full potential as the premiere specialty chemical company.

最後，我們對如期、按預期分拆成兩家優秀公司感到振奮，並相信這將使新Ashland得以轉移焦點，推動實現其作為頂尖特用化學品公司之全部潛力所必需的營運與財務要務。

We do thank you for your interest in Ashland, and I will now turn the call over to the operator to take your questions.

感謝各位對Ashland的關注，接下來我將把電話交給接線員，開始提問。

(Operator Instructions)

(接線員指示)

John Roberts, UBS.

John Roberts，UBS。

Thank you. Excluding the catalyst change in the first quarter, could you give us some guidance on what the normal seasonality is for the new Ashland ex-Valvoline?

謝謝。若排除第一季催化劑變更的影響，能否提供一些指引，說明新Ashland（不含Valvoline）的正常季節性為何？

Yes. This is Luis. What we have is, over all new Ashland, about 23% of our sales come in the first quarter, so we have definitely lower number of sales in the quarter. And as such, we see lower profitability. This is consistent with the previous years. And because of the high level of the depreciation that we have in our plans, that has an impact on EPS. As we expect to see moving forward, Q2 is stronger, Q3 is our strongest quarter, and then Q4 is similar to Q2.

好的。我是Luis。就整體新Ashland而言，我們約有23%的銷售額發生在第一季，因此本季的銷售確實較低。因此，我們看到獲利能力較低。這與過去幾年一致。而由於我們計畫中的折舊水準較高，這會對EPS造成影響。如我們預期，往後Q2較強，Q3是我們最強的一季，接著Q4與Q2相近。

Bill, last quarter, Bill, you mentioned a renewed emphasis on an assessment of the role of BDO in Ashland's portfolio. I didn't see anything in the prepared remarks on that. Could you give us an update?

Bill，上季你提到重新強調評估BDO在Ashland投資組合中的角色。我在事先準備的講稿中沒有看到相關內容。你能否提供最新進展？

Sure. Sure. That is an important part of our forward orientation. We know that to be the premier specialty chemical company we envision, you have to have a true specialty chemical type portfolio where you can really differentiate through innovation and adding value to customers. And we know that the intermediates business has more of a commodity dynamic. We do try to add value to our customers with the quality and services we provide.

當然。當然。這是我們前瞻導向的重要一環。我們知道，若要成為我們所期望的頂尖特用化學品公司，你必須擁有真正的特用化學品型投資組合，才能透過創新與為客戶增值來真正形成差異化。我們也知道，中間體業務更具有商品化的特性。我們確實嘗試透過我們提供的品質與服務為客戶增值。

But it's clear that it is more of a commodity dynamic. And so we do continue to look at that and are active in our thinking on the topic. As you can imagine, it's a challenging and important assessment to make because, first of all, BDO supply and consistency and quality of that cost competitiveness of that is important for the ASI business.

但很明顯，它更偏向商品化的動態。因此我們持續檢視此事，並在該議題上積極思考。如你所能想像，這是一項具挑戰且重要的評估，因為首先，BDO供應的穩定性、一致性與品質，以及其成本競爭力，對ASI業務很重要。

Also, as you hear from the results, this is a business that cyclical as it is, has been going through a downward cycle, and ultimately, we believe, is at the bottom of that cycle. And so making sure that we're making the right discipline decisions about how we, if you will, remove the commodity dynamic from our earnings, whether that be through any sort of specific actions related to contracts or other activities that we could take, we want to make sure that we are balanced, that we are driving towards ultimately reducing our exposure to that commodity dynamic, but also recognizing that, being at the lowest part of the cycle, you want to be very balanced with your approach and timing as to how to complete that.

另外，從結果你也聽到了，這項業務雖然具有循環性，但一直處於下行循環中，而我們最終相信目前已在該循環的底部。因此，確保我們在如何（如果你願意這麼說）將商品化動態自我們的獲利中移除方面做出正確且有紀律的決策——無論是透過與合約相關的任何特定行動或其他我們可採取的活動——我們希望確保取得平衡：一方面推動最終降低我們對該商品化動態的曝險，另一方面也要認知到在循環最低點時，完成此事的方法與時點必須非常審慎且平衡。

Thank you.

謝謝。

Mike Harrison, Seaport Global Securities.

Mike Harrison，Seaport Global Securities。

Good morning. Luis, you mentioned this sort of inflection that has happened in the raw material dynamics within the ASI business. Can you talk about what you are seeing specifically on the cellulosic side of the business? And then on the legacy ISP business, can you just remind us, as BDO prices are going up, how does that roll through the P&L and how does that impact ASI margin?

早安。Luis，你提到ASI業務的原物料動態出現了某種轉折。你能談談在纖維素相關業務方面，你具體看到了什麼嗎？另外在既有的ISP業務方面，能否請你提醒我們，當BDO價格上升時，這會如何反映在損益表（P&L）中，並且如何影響ASI的利潤率？

Sure, Mike. Let me start with your first question. We started to see that when we saw the inflation on cellulose specifically on one of the raw materials that is related to cotton. But the impact of raw materials in, I would say, most of the ASI business is more muted. The area where we have more of an impact is adhesives and composites just because they are a much more significant portion of the cost. And those are very much related to oil.

當然可以，Mike。我先從你的第一個問題開始。我們開始注意到這點，是在我們看到纖維素的通膨時，特別是某一項與棉花相關的原料。但我會說，在 ASI 業務的大多數領域，原料的影響相對較為溫和。我們受影響較大的領域是黏著劑與複合材料，因為它們在成本中占比更高。而這些又與石油高度相關。

I'm confident that we can always recover the increase and in fact there's always margin opportunities when that happens. But there's always a lag, which indicates composites is about 90 days. In terms of your second question on BDO, we are fundamentally, we see the inputs for us into ASI and we transfer at cost. That's one of the benefits of having the integration of this product in our portfolio. The only impact that we see is that the impact of raw materials impacting the manufacturing of BDO, not the impact of prices going up on the marketplace.

我有信心我們總是能把漲幅轉嫁回去，事實上，發生這種情況時也總會有毛利機會。但通常會有時間落後；以複合材料來看大約是 90 天。至於你第二個關於 BDO 的問題，我們基本上是把投入 ASI 的部分以成本轉移。這也是把這項產品整合進我們產品組合的好處之一。我們看到的唯一影響，是原料對 BDO 製造成本的影響，而不是市場上價格上漲所帶來的影響。

Understood. I was also hoping that you could give a little more detail on the skin care market. You referenced that you were intentionally walking away from some of the lower-margin sunscreen business. Can you just give some detail on how the sunscreen business is structured? How much of it is higher-margin and we're keeping? How much of it is lower margin and something you're going to walk away from? And what are your longer-term strategic plans for that product line?

了解。我也希望你能再多談一些護膚市場的細節。你提到你們是有意退出部分低毛利的防曬業務。你能否說明一下防曬業務的結構？其中有多少是高毛利、你們會保留的？有多少是低毛利、你們打算退出的？以及你們對這條產品線的長期策略規劃是什麼？

There's two elements to it. We have a very strong position in a specific molecule that is one of the most advanced molecules in sunscreens and that business continues to be important and significant for us. But in the past, we've chosen to compliment that product line with other materials where we haven't been as competitively advantaged, but where we had an ability to still command the right value for those technologies in the marketplace.

這裡有兩個面向。我們在某一種特定分子上有非常強的地位，那是防曬產品中最先進的分子之一，而那塊業務對我們仍然重要且具規模。但過去我們選擇用其他材料來補強這條產品線；在那些材料上我們的競爭優勢沒那麼強，但我們仍有能力在市場上為那些技術取得合理的價值。

What has happened is that there has been more of a price competition in those areas, so at this time, we're just not getting the value for those. So, two elements. One technology, we're very good at, and that will continue to be the case. There is a portion of the sunscreen market where, at this time, we're not getting the value for the products as we expect.

目前發生的情況是，那些領域的價格競爭加劇，因此在這個時間點，我們拿不到應有的價值。所以有兩個面向：有一項技術我們非常擅長，而且未來也會持續如此。但防曬市場中有一部分，在目前我們無法如預期般為產品取得價值。

And that is the fundamentals. It is a portion of our skin care business. We have other elements of our skin care business that are doing well and will continue to do well and it's masking some of the growth that we have on innovation. That is, in summary, what is happening with the skin care market.

這就是基本面。它是我們護膚業務的一部分。我們護膚業務的其他部分表現良好，未來也會持續良好，而這也在一定程度上掩蓋了我們在創新上的成長。總結來說，這就是護膚市場正在發生的情況。

All right. Thank you very much.

好的。非常感謝。

Christopher Parkinson, Credit Suisse.

Christopher Parkinson，瑞士信貸。

Thank you. Over the last three months, you've been instituting some broad-based price increases on various areas of your portfolio, most recently, one in HEC. Can you just comment a little more about these initiatives, initial success rates and how we should think about these in terms of quarterly cadence and what is actually embedded in your guidance? Thank you.

謝謝。過去三個月，你們在產品組合的多個領域推行了一些廣泛的漲價措施，最近一次是在 HEC。你能否再多評論一下這些措施、初步成功率，以及我們應如何從季度節奏來看待它們，還有你們的指引中實際已包含了哪些？謝謝。

Yes. Clearly, we are expecting success on those price increases and they are in our expectations for the quarter and the year. From a cadence perspective, we started announcing last quarter and we started to see the impact of that in the first quarter, but that was very muted. Because it just takes time because of contractual obligations and negotiations.

好的。很明顯，我們預期這些漲價會成功，而且它們已納入我們對本季與全年的預期。就節奏而言，我們在上一季開始宣布，並在第一季開始看到一些影響，但幅度非常有限。因為受合約義務與談判影響，確實需要時間。

We will see more of those flow in through the income statement in Q2. The key for us is to maintain very close attentions to the evolution of raw materials and driving our price-to-value initiatives to continue to show those through the P&L. But in summary, Q1, a very small impact. By Q2, we should start seeing more of them and continuing on in Q3 and Q4.

我們會在第二季看到更多反映到損益表中。對我們而言，關鍵是密切關注原料的變化，並推動我們的「價值對價」（price-to-value）措施，讓這些能持續在損益表上呈現。總結來說，第一季影響很小。到第二季，我們應該會開始看到更多，並在第三季與第四季持續。

And maybe just to add that the pricing actions, the structural pricing actions, have largely been related to, if you will, raw material dynamics and demand dynamics in the market space. Those are, to a great part, embedded in our forward outlook. The price-to-value initiatives that we see, those are what we will believe our upside over time to really realizing the full value of what we're bringing to our customers.

另外補充一下，這些定價行動、也就是結構性的定價行動，大多與原料動態以及市場需求動態有關。這些在很大程度上已反映在我們的前瞻展望中。至於我們看到的「價值對價」措施，我們相信那會是我們隨時間推進的上行空間，讓我們真正實現帶給客戶的完整價值。

Great. And just a quick follow-up on the personal care. Just from an end market basis, it still seems hair is still solid, oral is improving off of a destock last year, skin is challenging. Just based on your longer-term vitality index, can also just give some quick updates on new product growth contribution over the next few quarters and whether or not there are any updates on trends in emerging markets? Thank you.

很好。再快速追問一下個人護理。從終端市場來看，似乎美髮仍然穩健，口腔護理在去年去庫存後正在改善，護膚則具挑戰。基於你們較長期的活力指數（vitality index），也請你快速更新一下未來幾季新產品成長的貢獻，以及新興市場趨勢是否有任何更新？謝謝。

Let me start with emerging markets. Overall, we are seeing a slight improvement in demand on those, specifically in Brazil, where we are seeing more of a return to the normal consumption over there, both after the new government has been in place, but also as the real has recovered, giving more purchasing power to Brazil. China continues to be improving, or continues to improve. So, in fact, we had a good quarter for us in China. That has been a success area.

我先從新興市場談起。整體而言，我們看到那邊的需求略有改善，特別是在巴西；在新政府上任後，加上雷亞爾回升、提升了巴西的購買力，我們看到消費更回到正常水準。中國則持續改善。事實上，我們在中國這一季表現不錯。那一直是我們的成功領域。

When it comes to our innovation efforts and our vitality index, I feel very comfortable about our product portfolio and how it's growing. There's a lot going on in terms of innovation. What I would ask is that we have a full presentation in the May 1 timeframe where we can talk about all what is going on in the innovation side.

談到我們的創新努力與活力指數，我對我們的產品組合以及其成長方式感到非常放心。在創新方面有很多事情正在進行。我想請大家留意的是，我們在 5 月 1 日前後會有一場完整的簡報，屆時我們可以談創新端正在發生的一切。

The one thing I can tell you, I was, at the beginning of this week, in a trade show with many of our customers and I was very pleased because many of them, in the next three, four or five months, have product launches that will include the technologies and that was a home, personal care type of show. I feel confident that our initiatives are going to pan out in the next two, three quarters.

我可以告訴你的一點是，本週一開始我就在一個有許多客戶參與的展會上，我非常高興，因為他們當中很多人在接下來三、四或五個月會推出包含我們技術的產品；那是一個家用與個人護理類型的展會。我有信心，我們的各項措施會在接下來兩到三個季度逐步見效。

Thank you for the detail.

謝謝你提供的細節。

Dmitry Silversteyn, Longbow Research.

Dmitry Silversteyn，Longbow Research。

Good morning. Thank you for taking my call. A couple of follow-ups, if I may. On the question regarding the skin care products, you called it out as the only bad guy in ASI and you have your consumer revenues where volumes were down 2%. Is skin care that big a portion of consumer that it's offsetting the growth of the skin care in the all the others pharmaceuticals and the other things that are going for you? Or is the decline there so great? I'm just trying to reconcile how this one product category can be so impactful on the whole consumer portion of the ASI.

早安。謝謝你接聽我的電話。如果可以的話，我有幾個追問。關於護膚產品的問題，你把它點名為 ASI 裡唯一的「壞角色」，而你們的消費者端營收中，銷量下降了 2%。護膚在消費者端的占比有大到足以抵消其他領域（如藥品及其他對你們有利的項目）中護膚的成長嗎？還是說那邊的下滑幅度非常大？我只是想釐清，為什麼單一產品類別會對 ASI 的整體消費者板塊造成這麼大的影響。

That's a very good question, Dmitry. When it comes to volumes, the one thing that I always qualify that we have to be careful, there may be products that are in the lower price end so it may be a disproportionate amount of the volume, but not necessarily a disproportionate amount of sales. That's the case with some of the mixed issues that we mentioned on the skin care. So they might reflect the higher volume, but they are not as impactful when it comes to sales.

這是個非常好的問題，Dmitry。談到出貨量時，我總是要先提醒一點：我們必須小心，因為可能有一些產品位於較低價位端，因此在出貨量上可能占比不成比例，但不一定在銷售額上也占比不成比例。這就是我們在護膚品提到的一些混合因素的情況。所以它們可能反映較高的出貨量，但在銷售額方面的影響就沒那麼大。

In terms of the sales decline in personal care, really is a combination of that decision with mix and FX. So there's a variety of factors that got us to that 3% decline. Pharma was, again, was consistent with last year and that is after a very strong last year. I'm still confident in our growth potential in pharma. Hopefully that explains the dynamic.

就個人護理銷售下滑而言，確實是那項決策與產品組合及外匯（FX）共同作用的結果。因此，有多種因素導致我們出現3%的下滑。製藥業務則再次與去年持平，而且是在去年非常強勁的基礎之後。我仍然對我們在製藥領域的成長潛力有信心。希望這能解釋其中的動態。

Okay, yes. Thanks, Luis. Second question on the ASI volumes or revenue guidance overall. I think you said $530 million to $540 million, if I'm not mistaken. That that's basically maybe 1% to 2% volume growth or 1% or 2% sales growth year-over-year. Given that the industrial segment seems to have come back as nicely as they have, why are you not more optimistic on the top-line performance of ASI?

好的，是的。謝謝你，Luis。第二個問題是關於ASI的出貨量或整體營收指引。如果我沒記錯，你說的是5.30億到5.40億美元。那基本上可能代表年對年約1%到2%的出貨量成長，或1%到2%的銷售成長。鑑於工業部門似乎回升得相當不錯，為什麼你們對ASI的營收表現不更樂觀一些？

Well, we definitely are confident on the growth potential of the business, but we are counting on the impact of the current strength of the dollar and have put, have built that into the expectations.

嗯，我們當然對業務的成長潛力有信心，但我們也把目前美元走強的影響納入考量，並已將其反映在預期之中。

Okay, so basically, if the foreign exchange headwind is different for you guys, different sequentially. Okay. All right. Got it. And then final question on the performance material side of the story. This is not the first quarter you've mentioned the growth in composites and it's encouraging to hear that that business is growing for you guys.

好的，所以基本上，如果外匯逆風對你們而言有所不同、在序列上也不同。好的。好吧。明白了。然後最後一個問題是關於高性能材料（Performance Materials）這邊的情況。這不是你們第一次提到複合材料的成長，聽到這項業務在你們這裡持續成長令人鼓舞。

Are there a couple of end markets or a couple of geographies that are responsible for the good commentary that we've been hearing from composites? Because, frankly, looking at fiber and glass manufacturers and some other people out there in related businesses, they don't seem to be as bullish as you guys and certainly aren't delivering the results that you guys do.

是否有一兩個終端市場或一兩個地區，能解釋我們從複合材料聽到的這些正面評論？因為坦白說，看看纖維與玻璃製造商以及其他一些相關業務的公司，他們似乎沒有你們這麼樂觀，當然也沒有交出像你們這樣的成果。

Yes. There's a couple of things going on. Our composites business has proven to be very resilient and part of the reason is that we have introduced new products into new industries and we continue to grow in segments like the construction industry and really developing areas where composites were not used.

是的。有幾件事正在發生。我們的複合材料業務已證明非常具韌性，其中一部分原因是我們已將新產品導入新的產業，而且我們持續在建築等領域成長，真正去開發過去未使用複合材料的應用領域。

The way I see it, why we have been resilient is because we have been able to introduce products in areas where composites were not used, bringing value to our customers, and that puts us in a position where we can grow in a market that, you're right, is very muted. We see that in some portions of our business, but the benefit is that these new product introductions are giving us the ability to grow in a muted environment.

在我看來，我們之所以能保持韌性，是因為我們能在過去未使用複合材料的領域導入產品，為客戶帶來價值，這讓我們即使在你說得沒錯、相當低迷的市場中，仍能處於可成長的位置。我們在部分業務中也看到這種情況，但好處是這些新產品導入讓我們能在低迷環境中仍然成長。

Is there, for lack of a better term, one or two markets or geographies that are driving most of this strength?

換個說法，有沒有一兩個市場或地區在推動大部分的這股強勢？

Yes. The ones I highlight is construction applications that are actually not fiberglass. They are other types of composites. And both North America and Europe, which is where we have most of our business.

有的。我想強調的是一些建築應用，其實不是玻璃纖維。而是其他類型的複合材料。而且主要是在北美與歐洲，也就是我們大部分業務所在的地區。

Got it. Okay, Luis. And then one final question on Performance Materials. Your sales guidance for the year-over-year looks flattish depending on where in that range you fall. With BDO pricing going up and sequentially, and I'm assuming they're going to be up year-over-year as well. Again, is it foreign exchange that's holding you back on being more bullish on the top line?

了解。好的，Luis。最後還有一個關於高性能材料的問題。你們對年對年的銷售指引看起來大致持平，取決於你落在區間的哪一端。在BDO價格上升、且序列上升的情況下，我假設年對年也會上升。那麼，再次請問，是不是外匯因素讓你們無法對營收端更為樂觀？

On the BDO side, Dmitry, let's just be very clear, we are starting to see improvement sequentially, but we are still seeing significant year-on-year reductions. The reduction last year was very significant and it happened Q1, Q2, Q3. And as much as we see prices increasing, we don't see that trend changing until Q4. What we do see is that trend starting to abate. So the impact is going to be less in Q2, less in Q3, but at this time, we're still not seeing an improvement versus last year. But we're seeing definitely sequentially improvements.

在BDO方面，Dmitry，我們先說清楚：我們開始看到序列上的改善，但年對年仍然出現顯著下滑。去年的下滑幅度非常大，而且發生在第一季、第二季、第三季。儘管我們看到價格在上升，但我們認為這個趨勢要到第四季才會改變。我們確實看到的是這個趨勢開始趨緩。因此影響在第二季會更小、第三季會更小，但就目前而言，我們仍未看到相較去年有所改善。不過，我們確實明顯看到序列上的改善。

Okay, got it. All right, Luis. Thank you very much.

好的，了解。好，Luis。非常感謝。

Jeff Zekauskas, JPMorgan.

Jeff Zekauskas，摩根大通（JPMorgan）。

Thanks very much. Can you remind us why your ongoing tax rate is as low as it is and for what period of time that will continue in the future?

非常感謝。你能提醒我們，為什麼你們的持續有效稅率（ongoing tax rate）會這麼低，以及未來會在多長一段期間內維持這種水準嗎？

This is Kevin. The tax rate is largely due to expected regional income mix in a post-Valvoline world, where a large portion of our pretax income will be generated in much lower-taxed jurisdictions. And something we have outlined pretty thoroughly in our 10-K, you can go take a peek, is our Swiss principal structure, which is a driver of that.

我是Kevin。稅率主要是因為在Valvoline剝離後的架構下，預期的區域所得組合所致，我們相當大一部分的稅前所得將在稅率低得多的司法管轄區產生。另外，我們在10-K中已相當完整地說明，你可以去看一下：我們的瑞士主體（Swiss principal）架構是其中一個驅動因素。

And we would expect that to be the structural tax rate going forward. Obviously, the caveat there would be tax reform and other actions that could occur from a US or non-US perspective could certainly impact that. But based on everything that we know today and can predict today, we would expect that to be standalone Ashland's tax rate going forward.

而我們預期未來這會是結構性的稅率。當然，需要補充的是，稅制改革以及其他可能從美國或非美國角度發生的措施，都可能對此造成影響。但就我們今天所知、以及今天能預測的情況而言，我們預期這將是Ashland在獨立運作下未來的稅率。

And your cash tax rate and your book tax rate are similar?

那你們的現金稅率（cash tax rate）和帳面稅率（book tax rate）相近嗎？

I would expect the cash tax rate to be somewhat higher just because of some of the anomalies that will ultimately run through the numbers. We will get more specific about that over the course of time. We're obviously still in a situation where we are not separate and we'll have to see how all that plays out. But we'll provide more clarity on that as we can.

我預期現金稅率會稍微高一些，因為有一些最終會反映在數字中的異常項目。我們會隨著時間推進提供更具體的說明。我們顯然仍處於尚未完全分拆的狀態，還得看整體會如何發展。但在我們能做到的範圍內，會提供更清楚的資訊。

Is it a meaningful difference or it's a small difference?

這個差異會很顯著，還是只是小幅差異？

It's too early to tell at this point. Like I said, we will provide more detail on that as we go forward.

目前還太早，無法判斷。如我所說，我們會在往後提供更多細節。

Okay, good. Thank you so much.

好的，很好。非常感謝。

Laurence Alexander, Jefferies.

Laurence Alexander，Jefferies。

Good morning. It's actually Dan Rizzo on for Laurence. How are you? Just a quick clarification for your guidance for next quarter for the operating income, so the $4 million to $6 million range in operating income, that includes already the $13 million from pension expense, or sorry, from pension?

早安。其實我是代替Laurence的Dan Rizzo。你好嗎？我想快速釐清一下你們對下季營業利益的指引：營業利益4百萬到6百萬美元的區間，這已經包含了1,300萬美元的退休金費用（pension expense）嗎？或抱歉，是退休金的……？

That is correct, Dan. It's roughly $17 million estimated from a pension and post-retirement benefit income standpoint. That $4 million to $6 million range does include that number, that is correct.

沒錯，Dan。從退休金與退休後福利收入的角度來看，估計約為1,700萬美元。那個400萬至600萬美元的區間確實包含這個數字，沒錯。

Okay. And then for just looking at the back half of the year, in terms of what you are giving for segment guidance for ASI and APM, am I wrong that you're expecting kind of a big ramp, given the FX and raw material headwinds that are probably developing? Are you expecting them to lessen or just what's the thought process there?

好的。那麼如果只看下半年，就你們對ASI和APM提供的部門指引而言，我是不是可以理解為你們預期會有相當大的拉升，考量到外匯與原物料的逆風可能正在形成？你們預期這些逆風會減弱嗎？或你們的思考脈絡是什麼？

The way I would characterize it is we would expect normal seasonality in terms of business performance. As Luis indicated, Q1 is and has always been our weakest quarter due to seasonality. FX and that sort of thing we will certainly continue to provide context around that. As we indicated, the team did a nice job in Q1 of overcoming those hurdles year-over-year, if you will.

我會這樣描述：我們預期業務表現會呈現正常的季節性。如Luis所指出，第一季一直以來都是、也始終是我們因季節性因素而最弱的一季。至於外匯之類的因素，我們當然會持續就此提供相關背景說明。如我們所提到的，團隊在第一季做得很好，成功克服了這些同比的障礙。

As you well know, the dollar versus significant other currencies is continuing to move around a fair bit. We're obviously paying close attention to that and, like I said, we will provide the appropriate context around that. But it's our expectation that whatever currencies do, that the team will manage through that to ultimately produce the results that we have projected. We have a lot of confidence and faith in the projection for both those businesses where we sit today.

如你所知，美元相對於其他主要貨幣的走勢仍在相當程度地波動。我們顯然會密切關注這點，而且如我所說，我們會就此提供適當的背景說明。但我們的預期是，不論匯率如何變動，團隊都會加以管理，最終產出我們所預測的結果。就目前而言，我們對這兩項業務的預測非常有信心。

Thank you very much.

非常感謝。

James Sheehan, SunTrust.

James Sheehan，SunTrust。

Good morning. I was wondering if you could comment on some of the structural reforms and policy changes you see coming in Washington and how they might affect you. Specifically, I would like to know about your sunscreen formulation that has kind of been held up at the FDA for UVA and UVB protection. I think that's been stalled for some time. Do you see any hope that some movement on that front is close?

早安。我想請你們評論一下，你們在華盛頓看到的一些結構性改革與政策變動，以及它們可能如何影響你們。具體而言，我想了解你們的防曬配方，因UVA與UVB防護而在FDA那邊有點卡住。我認為這已經停滯一段時間了。你們是否看到這方面近期有任何推進的希望？

Sure. So, this is Bill here. The changes that are taking place in Washington, I think, we all know are unfolding and a little bit difficult to predict in terms of the full direction and impact. In particular, though, it's been unfortunate that there hasn't been further progress in moving the sunscreen protection act and the related testing and approvals through the FDA.

當然。我是Bill。我想大家都知道，華盛頓正在發生的變化仍在發展中，就其完整方向與影響而言，確實有點難以預測。不過特別令人遺憾的是，防曬保護法案以及相關測試與核准在FDA的推進，並沒有取得更多進展。

And quite obviously, given the lack of progress to date, any changes that occur in that front would most likely have a beneficial effect. So we are optimistic that this change or these changes will be to our advantage, if you will, and to the advantage of the public, because this is a product that is good for people and we believe should be out there helping to protect people. That is one of positive effects we see.

而且很明顯地，鑑於目前為止缺乏進展，若這方面出現任何變化，很可能會帶來正面效益。因此我們樂觀地認為，這項變化或這些變化將對我們有利，也將有利於大眾，因為這是一個對人們有益的產品，我們相信它應該上市，幫助保護人們。這是我們看到的其中一項正面影響。

Certainly, as you see a more robust environment for construction, whether that be infrastructure or it ultimately relates to other commercial and residential construction, that will be good for our composites business. And so there are a number of areas that feel like they could be positives since we are a significant exporter of materials.

當然，若建築環境更為強勁，無論是基礎建設，或最終延伸到其他商用與住宅建築，這都將有利於我們的複合材料業務。因此有不少領域看起來可能是正面的，因為我們是重要的材料出口商。

We don't have a lot of materials that we produce, for example, in Mexico, that we import into the US. We don't feel like we're going to be impacted by that type of dynamic or trend. It's really difficult to call what will play out in Washington. But we don't see indications that are problematic on the surface from where we're sitting at this point in time. If anything, the opposite. Hopefully, they will be beneficial.

例如，我們在墨西哥生產、再進口到美國的材料並不多。我們不認為會受到那類動態或趨勢的影響。華盛頓最終會如何發展真的很難判斷。但就我們目前所處的位置來看，表面上看不出有任何令人擔憂的跡象。如果有的話，反而是相反。希望會帶來益處。

Great. In terms of you're lag in getting pricing versus raw material costs escalation, I think you mentioned what it was in composites. What specifically would that lag be in ASI?

很好。關於你們在定價跟上原物料成本上升方面的落後時間，我想你提到複合材料的情況。那在ASI方面，具體的落後時間會是多少？

So, in composites and adhesives, as I said, it tends to be about a 60 to 90 day timeframe. In the case of ASI, again, the impact, first and foremost, is much more muted just because of the impact of raw materials on the overall cost. There is a lot of value added on what we put. Some other materials have some much lesser impact into them. I think the key for us is to continue to drive our commercial excellence initiatives and price-to-value.

所以，在複合材料與黏著劑方面，如我所說，通常大約是60到90天。就ASI而言，同樣地，影響首先要小得多，因為原物料對整體成本的影響較低。我們投入的有很多是加值。其他一些材料的影響更小。我認為對我們而言，關鍵是持續推動商業卓越（commercial excellence）計畫與價值定價（price-to-value）。

I that think part of the reason we're able to compensate for that is because even before raw materials were going up, we were implemented some of those commercial excellence initiatives. And again, the dynamic is slightly different. If there was a huge impact, it also takes us between 60 to 90 days, but again, it's much more muted in the rest of the portfolio with adhesives and composites being the ones that are highly impacted.

我認為我們之所以能夠彌補其中一部分原因，是因為即使在原物料上漲之前，我們就已經在推行其中一些商業卓越計畫。而且同樣地，這個動態略有不同。如果影響非常大，我們也需要60到90天，但同樣地，在其餘產品組合中影響要小得多；黏著劑與複合材料是受影響較大的。

Thank you.

謝謝。

David Begleiter, Deutsche Bank.

David Begleiter，德意志銀行。

Thank you. Luis, on performance materials, again, the fact that earnings were down sequentially Q1 to Q2 adjusted for the Lima, Ohio catalyst outage or change, is that just due to the lag in recapturing raw materials or is there something else driving that sequential lag or decline?

謝謝。Luis，關於高性能材料（performance materials），再確認一下：若排除俄亥俄州利馬（Lima）催化劑停機或變更的影響，第一季到第二季的獲利經調整後呈現季減，這只是因為回收原物料成本的落後效應，還是還有其他因素在驅動這個季比的落後或下滑？

Yes, again, sequentially speaking, we do expect to see some improvement in terms of BDO pricing, but we also expect to see some level of raw material increases and the impact of FX. The only other thing that I would mention is that as we did the calculations, we are seeing much more muted impact on the BDO derivatives, things that are not quite BDO, but are still intermediates.

是的，就季比而言，我們確實預期BDO定價會有所改善，但我們也預期原物料會有一定程度的上漲，以及外匯的影響。另外我想提到的是，當我們進行計算時，我們看到BDO衍生品的影響要溫和得多，也就是那些不完全是BDO、但仍屬於中間體的產品。

But we're not seeing yet the price increase. Those are some of the elements, and again, quarter-to-quarter, we also have certain shutdowns that impact the business. The one issue on Q1 is that it was one of those shutdowns that only happens every four to five years. But that does not mean that we don't have some level of shutdown activity, that it's normal, let me put it this way, on Q2.

但我們還沒有看到價格上調。這些是其中一些因素；而且同樣地，按季度來看，我們也有某些停機會影響業務。第一季的其中一個問題是，那次停機屬於每四到五年才會發生一次的類型。但這並不代表我們沒有一定程度的停機活動；換句話說，第二季出現一些停機是正常的。

Understood. And just on ASI, nice guidance for Q2 on the margins. Would you expect that margin range in the back half of the year or is there potential to even go above 25% do you think for ASI in the back half of the year on an EBITDA margin basis?

了解。再談ASI，你們對第二季的利潤率指引很不錯。你們預期下半年也會維持那個利潤率區間嗎？或者你認為下半年ASI在EBITDA利潤率基礎上，甚至有機會超過25%？

Well, we traditionally have much stronger margins in Q2. Q3 is our strongest margin, Q, thank you, for our strongest margin in the year and that again has to do with both demand as well as maintenance activities in our plants. We expect to see the same system and pattern that we've seen in previous years. In order for us to get the average of 23%, obviously, the Q2, Q3, Q4 have to have strong margins in the 24% to 25% range.

嗯，我們傳統上在第二季的利潤率會強很多。第三季是我們全年利潤率最高的一季，謝謝你，這同樣與需求以及我們工廠的維護活動有關。我們預期會看到與往年相同的體系與模式。為了讓全年平均達到23%，很明顯第二季、第三季、第四季必須要有強勁的利潤率，約在24%到25%的區間。

Thank you very much.

非常感謝。

Mike Sison, KeyBanc.

KeyBanc 的 Mike Sison。

Hey guys, nice quarter, there. When you think about ASI, I'm encouraged that your outlook, at least near-term, is still on track. When you think about the industrial specialties business and the volume growth recovery, a lot of folks in the space have not really seen much of a recovery or looking for a recovery. So it sounds like a lot of that is within your control. Do you expect volumes to remain fairly good for the next couple of quarters?

各位好，這一季表現不錯。談到 ASI，我很受鼓舞的是，至少在短期內，你們的展望仍然按計畫進行。談到工業特殊品業務以及銷量成長的復甦，這個領域裡很多公司其實還沒有真正看到太多復甦，或仍在期待復甦。所以聽起來其中很大一部分是在你們可控範圍內。你們是否預期未來幾季的銷量仍會維持相當不錯？

Yes, I mean, obviously, we're happy to see what happened in Q1. We're optimistic about the future quarters and we see that. I think that there's three elements that are impacting our industrial business. Number one, innovation is faster to implement in industrial business, that means that in regulated business just because of the nature of regulations.

是的，我的意思是，很明顯我們很高興看到第一季的表現。我們對未來幾季保持樂觀，也確實看到這樣的趨勢。我認為有三個因素正在影響我們的工業業務。第一，創新在工業業務中的導入速度更快，這相較於受監管業務而言是如此，因為監管的本質使然。

We are seeing the benefit of some innovative products that have been implemented by our customers a little bit faster. We are seeing faster also results from our pipeline. We said about six months ago that we were improving our pipeline opportunities and we can see those panning out. But I would tell you, there are industries where we see improvements in demand and the coatings industry is one that I think the US is doing better overall.

我們看到一些創新產品的效益，因為客戶導入得更快一些。我們也看到我們的商機管線（pipeline）更快產生成果。大約六個月前我們提到正在改善管線機會，我們現在可以看到這些正在開花結果。但我想說的是，有些產業我們看到需求改善，其中塗料產業就是一個例子，我認為美國整體表現更好。

So is the demand in China. The combination of better demand consumer for downstream markets together with innovation and pipeline management is what's driving the results. I think that most of those strengths are still solid for this quarter.

中國的需求也是如此。下游市場的消費需求轉佳，加上創新與管線管理的結合，正是推動成果的原因。我認為這些優勢在本季仍然相當穩固。

This is Bill here. I would just add in that when we talk about driving and moving towards a more focused operating company with this transition, there is a real change in terms of how we're managing the Company, the metrics that we're looking at, the cadence of review. We've talked about some changes in leadership that have occurred.

我是 Bill。我想補充的是，當我們談到透過這次轉型，推動並邁向更聚焦的營運型公司時，在公司管理方式、我們關注的指標、檢視的節奏方面，確實出現了實質改變。我們也談過一些已發生的領導階層變動。

I would not underestimate it because we have always felt, as I think you have, that the potential for real growth, whether it be the revenue growth or margins, is there. And while the team has done a great job over time by being able to focus on really a substantial part of our daily effort to reach in that peak performance, we think that is something that truly will pay off and not just today, but over time.

我不會低估這點，因為我們一直覺得——我想你也一樣——真正成長的潛力，不論是營收成長或利潤率，都確實存在。而且雖然團隊長期以來做得很好，能把日常工作中相當大的一部分精力聚焦在達到巔峰表現上，我們認為這將真正帶來回報，不僅是今天，而是長期而言。

Great. When you think about each of the businesses within ASI, your balance sheet is going to be in a good shape, is still in pretty good shape. You are nearing the spin of Valvoline here. What areas make sense to really focus on continue to grow via maybe bolt-on acquisitions and maybe fortify? Anything in particular you would like to add to the portfolio longer-term as you continue to grow the business?

很好。談到 ASI 旗下各項業務，你們的資產負債表狀況會很好，目前也仍然相當不錯。你們也即將完成 Valvoline 的分拆。哪些領域值得真正聚焦，透過可能的補強型併購（bolt-on acquisitions）持續成長並加以強化？就長期而言，隨著你們持續成長業務，有沒有特別想要納入投資組合的項目？

What I would say, and I think it will be a little clearer when we have our investor day coming up here, is, and last time in our investor day, we talked a lot about the chemistry platforms and how those basically took us into spaces which were very attractive like the pharma and personal care and coatings and others. I think what you'll hear a bit more about in May is the real value and the real differentiation that we have in those industry areas.

我想說的是——我認為等到我們即將舉行的投資人日會更清楚——上一次投資人日我們談了很多化學平台，以及這些平台如何把我們帶入一些非常有吸引力的領域，例如製藥、個人護理、塗料等。我認為你們在五月會聽到更多的是，我們在這些產業領域所具備的真正價值與真正差異化。

What is the value equation that we bring specifically in pharma and in coatings? And we can articulate that a bit now, but the point is that we would be looking for acquisitions that clearly have the right financial economics associated with them and that's a whole separate discussion, but I think, hopefully, that is fairly straightforward what our thinking would be on that point. There's been a lot of discipline in the past and there certainly would be going forward.

我們在製藥與塗料領域具體帶來的價值方程式是什麼？我們現在可以先稍作說明，但重點是，我們會尋找在財務經濟性上明確符合條件的併購標的——這又是另一個話題——但我希望我們在這一點上的思路應該相當清楚、也相當直接。過去一直很有紀律，未來也一定會如此。

But to your question, in areas that would have value propositions to the customer that would extend the solutions that we provide, thematically within those spaces. And so that is how I would put it. I mean, clearly, we would concentrate our efforts in the areas which we view as core and in certain very differentiated niche areas, but it would really be to extend the range of solutions that we can provide within those market spaces.

回到你的問題，在那些能為客戶提供價值主張、並能延伸我們所提供解決方案的領域——以這些空間的主題方向來看——我們會去尋找機會。所以我會這樣表達。很明顯，我們會把精力集中在我們視為核心的領域，以及某些高度差異化的利基領域，但主要目的會是擴大我們在這些市場空間中可提供的解決方案範圍。

Great, thank you.

很好，謝謝。

Thank you. And that does conclude our Q&A session for today. I'd like to turn the call back over to Mr. Seth Mrozek for any further remarks.

謝謝。以上即為今天的問答環節。我想把電話交回給 Seth Mrozek 先生，請他做進一步的結語。

Thank you, Kristy. Thank you, everyone, for your time this morning and your interest in Ashland. I hope everyone has a great day. Take care.

謝謝你，Kristy。也謝謝各位今天早上撥冗參與，並對 Ashland 的關注。祝大家今天愉快。保重。

Ladies and gentlemen, thank you for participating in today's conference. This does conclude today's program and you may all disconnect. Everyone, have a great day.

各位女士、先生，感謝您參與今天的會議。今天的議程到此結束，您現在可以掛線。祝各位今天愉快。