Ashland Inc. (ASH) 2017 Q3 法說會逐字稿

Good day, ladies and gentlemen, and welcome to the Ashland Global Holdings Third Quarter Earnings Conference Call. (Operator Instructions) As a reminder, this conference is being recorded.

各位女士、各位先生，大家好，歡迎參加 Ashland Global Holdings 第三季財報電話會議。(接線員指示) 提醒各位，本次會議將被錄音。

I would now like to introduce your host for today's conference, Seth Mrozek, Director of Investor Relations. Sir, please begin.

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，請開始。

Thank you, Norma. Good morning, everyone, and welcome to Ashland's Third Quarter Fiscal 2017 Earnings Conference Call and Webcast.

謝謝你，Norma。各位早安，歡迎參加 Ashland 2017 會計年度第三季財報電話會議與網路直播。

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; and Kevin Willis, Senior Vice President and Chief Financial Officer.

我是 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，以及資深副總裁兼財務長 Kevin Willis。

We released preliminary results for the quarter ended June 30, 2017 at approximately 5:00 p.m. Eastern Time yesterday, August 1. 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 8 月 1 日美東時間下午約 5:00，發布截至 2017 年 6 月 30 日之季度初步業績。此外，我們已在網站 ashland.com 的投資人關係專區上傳簡報與事先準備的講稿，並已以 Form 8-K 形式向美國證券交易委員會（SEC）提交上述文件。

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 U.S. securities law. We believe any such statements are based on reasonable assumptions, but cannot assure that such expectations will be achieved.

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，但無法保證這些預期將會實現。

Please also note that we will be discussing adjusted results during this call. We believe this enhances understanding of our performance by more accurately reflecting our ongoing business.

也請注意，我們將在本次電話會議中討論調整後（adjusted）結果。我們相信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。

With that, I will turn the call over to Bill. Bill?

接下來，我把電話交給 Bill。Bill？

Thank you, Seth, and good morning, everyone.

謝謝你，Seth，各位早安。

During our third fiscal quarter, the Ashland team took strong action to drive year-over-year sales and earnings gains. Note that this was our first quarter as a pure-play specialty chemical company following the successful separation of Valvoline in May.

在我們的會計年度第三季，Ashland 團隊採取了有力行動，推動銷售與獲利較去年同期成長。請注意，這是我們在 5 月成功分拆 Valvoline 之後，作為純專業化學品公司（pure-play specialty chemical company）的第一個季度。

Within Specialty Ingredients, the team delivered a 7% sales increase. The acquisition of Pharmachem, which the Ashland team completed earlier than originally anticipated, was a major contributor to Specialty Ingredients sales gains and was also accretive to our earnings in the third quarter. We are on track with the integration and anticipate achieving meaningful cost and tax synergies as we move forward.

在 Specialty Ingredients 事業中，團隊實現了 7% 的銷售成長。Ashland 團隊比原先預期更早完成的 Pharmachem 收購案，是 Specialty Ingredients 銷售成長的主要貢獻者，並且在第三季也對我們的獲利具有增益（accretive）。我們的整合進度如期推進，並預期在後續將實現具實質意義的成本與稅務綜效。

In addition, beyond our deal economics, we are targeting additional market synergies. We are already beginning to globalize Pharmachem's products, leveraging our sales and manufacturing network and we're also pursuing a number of market and technology base synergies. So for example, we're preparing to introduce our first combined new product, a multifunctional supplement. It is novel, of high efficacy and it's iron-based supplement and it has none of the metallic taste present in some of the alternative options.

此外，除了交易本身的經濟效益之外，我們也鎖定額外的市場綜效。我們已開始將 Pharmachem 的產品推向全球，運用我們的銷售與製造網絡，同時也在推進多項市場與技術平台的綜效。例如，我們正準備推出第一個共同開發的新產品：一款多功能補充品。它是創新且高效能的鐵基補充品，且不會像某些替代方案那樣帶有金屬味。

This was a collaboration and a development using certain Ashland products with the formulation and customer expertise of Pharmachem who determined how best to develop a complete nutraceutical system and bring it to market. We are now in the launch phase of this product and while we expect the sales to be limited, it's a great initial indication of the type of synergies being pursued.

這是一次合作開發，結合了部分 Ashland 產品，以及 Pharmachem 在配方與客戶端的專業能力；Pharmachem 判斷如何最佳化地開發完整的營養保健（nutraceutical）系統並推向市場。我們目前正處於該產品的上市階段，雖然預期銷售規模有限，但這是我們所追求綜效類型的一個很好的初步指標。

Moving back to ASI, in addition to the Pharmachem acquisition, the Specialty Ingredients team focused on actions to improve pricing and mix. Consumer Specialties sales and volumes grew by 16% and 11%, respectively, compared to the prior year period. These gains were driven by the previously described addition of Pharmachem to the portfolio; disciplined volume and price execution resulting in share gains within the oral and skin care markets; and while hair care sales were flat year-over-year, the team successfully introduced FiberHance, which is an innovative and patented bond chemistry that addresses a key market need in terms of repairing hair breakage that comes from coloring and hair straightening. The personal care team also launched a number of other new products during the quarter, including sunscreen formulations that deliver SPF 50+ UV protection without greasiness and a new biofunctional that helps users care for aging skin.

回到 ASI。除了 Pharmachem 收購案之外，Specialty Ingredients 團隊也專注於改善定價與產品組合的行動。相較去年同期，Consumer Specialties 的銷售與銷量分別成長 16% 與 11%。這些成長來自前述將 Pharmachem 納入產品組合；在口腔與皮膚護理市場中，以嚴謹的銷量與價格執行帶動市占提升；此外，雖然美髮護理銷售與去年同期持平，團隊成功推出 FiberHance——這是一項創新且具專利的鍵結化學（bond chemistry），可滿足市場關鍵需求，修復因染髮與拉直造成的斷裂受損。個人護理團隊在本季也推出多項其他新產品，包括可提供 SPF 50+ 紫外線防護且不油膩的防曬配方，以及一款新的生物功能性成分（biofunctional），協助使用者保養熟齡肌膚。

During the quarter, the pharma team focused on leveraging available production capacity to drive a better margin mix. These actions are consistent with the asset utilization efforts we described during our May Investor Day and resulted in improved margin contribution despite a 1% sales decline.

本季，製藥團隊專注於運用可用產能，以推動更佳的毛利組合。這些行動與我們在 5 月投資人日所描述的資產使用率提升努力一致，儘管銷售下滑 1%，仍帶來更佳的毛利貢獻。

To enable faster growth in Pharma in the future, we're completing a number of capacity-related projects such as the Klucel expansion that is now being commissioned at our Hopewell, Virginia plant where Kevin and I will be tomorrow; and in another example, where we worked as one team taking the one Ashland team approach and put together a multifunctional team that focused on expanding the yield and output of pharma-grade Benecel products at our Doel, Belgium facility. And that team has made great progress, nearly doubling the amount of pharma-grade product produced as intended.

為了讓 Pharma 未來能更快速成長，我們正在完成多項與產能相關的專案，例如 Klucel 擴產案，目前正在維吉尼亞州 Hopewell 工廠進行試車投產（commissioning），Kevin 和我明天將前往該地；另外一個例子是，我們以「One Ashland」的團隊方式合作，組成跨功能團隊，專注於提升比利時 Doel 廠藥用級 Benecel 產品的良率與產出。該團隊已取得重大進展，如預期幾乎將藥用級產品產量提高一倍。

Now, turning to Industrial Specialties. Sales increased by 1% and volumes declined by 1% when compared to the prior year. Recent softening of industry demand for architectural coatings ingredients were more than offset by year-over-year sales gains in energy.

接著談 Industrial Specialties。與去年同期相比，銷售成長 1%，銷量下滑 1%。建築塗料添加劑的產業需求近期轉弱，但被能源業務的年對年銷售成長所抵銷。

Overall, the combination of the addition of Pharmachem and our price mix actions enabled Specialty Ingredients to increase its adjusted EBITDA by 2% in the quarter to $131 million, which was at the upper end of our outlook range. I will share our fourth quarter outlook for Specialty Ingredients and the other businesses later in the call.

整體而言，Pharmachem 的併入以及我們的價格/組合行動，使 Specialty Ingredients 本季調整後 EBITDA 成長 2% 至 1.31 億美元，位於我們展望區間的上緣。我將在稍後的電話會議中分享 Specialty Ingredients 以及其他業務的第四季展望。

Turning now to Composites. The team grew sales by 20%. This was driven by a 10% increase in volumes resulting from strong demand for our value-added products in North America and Asia as well as approximately 3% sales growth that came from the additional volumes from the facility in Etain, France, which we acquired from Reichhold earlier in June.

接著談 Composites。團隊將銷售提升 20%。這主要來自銷量成長 10%，反映北美與亞洲對我們高附加價值產品的強勁需求；此外，約 3% 的銷售成長來自我們於 6 月稍早自 Reichhold 收購的法國 Etain 廠所帶來的額外產量。

We're pleased to have the Etain team join Ashland and believe the acquisition will strengthen Ashland's position in the European composites market. More specifically, we will believe it will help us to improve service levels and reduce logistics cost due to its location relative to our other existing European composites facilities, which are in Spain, Finland and Poland. It will also expand our capabilities to supply the automotive and wind energy markets.

我們很高興 Etain 團隊加入 Ashland，並相信此收購將強化 Ashland 在歐洲複合材料市場的地位。更具體而言，我們相信它將有助於提升服務水準並降低物流成本，原因在於其地理位置相對於我們其他既有的歐洲複合材料據點（位於西班牙、芬蘭與波蘭）。同時也將擴大我們供應汽車與風電市場的能力。

Also in the quarter, the Composites team executed important price increases which enabled us to offset sharp rises in raw material prices, mainly styrene, which were experienced during the prior quarter. Thus, for the quarter, the Composites team reported adjusted EBITDA of $27 million or a 17% increase over the prior year period.

此外在本季，Composites 團隊執行了重要的漲價措施，使我們得以抵銷前一季所經歷的原物料價格大幅上漲，主要是苯乙烯（styrene）。因此，本季 Composites 團隊的調整後 EBITDA 為 2,700 萬美元，較去年同期成長 17%。

Within I&S, the team grew sales 9%. This strong growth was driven by the successful implementation of price increases for BDO, consistent with improving global supply/demand dynamics. Mix was also a contributing factor in year-over-year sales growth due to the strong execution by the I&S team. So during the quarter, I&S reported adjusted EBITDA of $10 million, a 43% increase over the prior year.

在 I&S 方面，團隊將銷售提升 9%。這項強勁成長主要來自 BDO 漲價的成功落實，與全球供需動態改善一致。由於 I&S 團隊的強力執行，產品組合也對年對年銷售成長有所貢獻。因此，本季 I&S 的調整後 EBITDA 為 1,000 萬美元，較去年同期成長 43%。

Note that on a combined basis in the third quarter, the reported sales and adjusted EBITDA results for Composites and I&S exceeded the outlook range which we provided at the beginning of the quarter for the former Ashland Performance Materials reportable segment.

請注意，以合併基礎來看，在第三季，複合材料（Composites）與 I&S 的已報告銷售額及調整後 EBITDA 結果，均超出我們在季初針對前 Ashland Performance Materials 可報告部門所提供的展望區間。

Now, I will turn the call over to Kevin to discuss some corporate items. Kevin?

現在，我將把電話會議交給 Kevin，請他說明一些公司層面的事項。Kevin？

Thank you, Bill, and good morning, everyone.

謝謝你，Bill，各位早安。

Adjusted EBITDA in the quarter was $161 million compared to $167 million in the year-ago period. The prior year period included $17 million of pension income and $6 million of stranded costs related to Valvoline.

本季調整後 EBITDA 為 1.61 億美元，較去年同期的 1.67 億美元下降。去年同期包含 1,700 萬美元的退休金收益，以及與 Valvoline 相關的 600 萬美元擱置成本（stranded costs）。

In the quarter, we reported a GAAP loss from continuing operations attributable to Ashland of $0.26 per diluted share. When adjusted for key items, earnings per share attributable to Ashland were $0.83 compared to $0.78 in the prior year. The net income -- the net impact to adjusted EPS from the pension and stranded costs was $0.12 per diluted prior year share and is included in the prior year adjusted EPS results.

本季，我們報告依 GAAP 計算、歸屬於 Ashland 的持續營運稀釋每股虧損為 0.26 美元。在就關鍵項目調整後，歸屬於 Ashland 的每股盈餘為 0.83 美元，去年同期為 0.78 美元。淨收益——退休金與擱置成本對調整後 EPS 的淨影響為每股 0.12 美元（以去年稀釋股數計），並已包含在去年調整後 EPS 結果中。

Pharmachem was accretive to Ashland's earning in the quarter, adding $0.02 to our adjusted EPS. We expect Pharmachem to contribute another $0.03 to $0.04 per share in the fourth quarter. We have already begun to integrate the businesses and, going forward, you should expect Pharmachem to be increasingly commingled, both operationally and from a financial reporting perspective, with the rest of Specialty Ingredients.

Pharmachem 在本季對 Ashland 的獲利具有增益（accretive），為我們的調整後 EPS 增加 0.02 美元。我們預期 Pharmachem 在第四季將再貢獻每股 0.03 至 0.04 美元。我們已開始整合這些業務；展望未來，您應可預期 Pharmachem 將在營運面與財務報導面，與 Specialty Ingredients 其餘業務日益融合。

Our effective tax rate for the third quarter after adjusting for key items was 11%. We currently expect the effective tax rate for the fourth quarter to be in the range of 15% to 20%, driven primarily by income mix and discrete tax items. For fiscal 2017, we continue to expect an annual effective tax rate after adjusting for key items of 10% to 15%.

第三季在就關鍵項目調整後的有效稅率為 11%。我們目前預期第四季有效稅率將落在 15% 至 20% 的區間，主要受所得組合與一次性稅務項目影響。就 2017 會計年度而言，我們仍預期在就關鍵項目調整後的全年有效稅率為 10% 至 15%。

Capital expenditures were $53 million during the quarter compared to $61 million in the prior year period.

本季資本支出為 5,300 萬美元，去年同期為 6,100 萬美元。

Free cash flow during the third quarter was $79 million compared to $27 million in the prior year. While there can be many balance sheet puts and takes in our fourth quarter, we continue to expect free cash flow in the range of $90 million to $100 million during fiscal 2017. This includes approximately $75 million of one-time separation and severance-related payments.

第三季自由現金流為 7,900 萬美元，去年同期為 2,700 萬美元。雖然第四季資產負債表可能有多項變動因素，我們仍預期 2017 會計年度自由現金流將落在 9,000 萬至 1 億美元的區間。其中包含約 7,500 萬美元的一次性分拆與遣散相關付款。

Turning now to the balance sheet. During the quarter, we established a new bank credit facility to support the Pharmachem acquisition. We also refinanced our 2018 notes with a new Term Loan B. These prepayable loans will help enable Ashland to efficiently repay debt and reach our leverage target of 3.5x gross debt-to-EBITDA within roughly the next couple of years.

接著談資產負債表。本季我們建立了一項新的銀行信貸融資，以支援 Pharmachem 的收購。我們也以新的 B 期定期貸款（Term Loan B）為 2018 年到期票據進行再融資。這些可提前償還的貸款將有助於 Ashland 更有效率地償還債務，並在未來約幾年內達成我們的槓桿目標：總債務對 EBITDA 倍數 3.5 倍。

Ashland's liquidity position remains very strong. At the quarter-end, Ashland had approximately $1.1 billion of available liquidity, including $492 million in cash. The majority of this cash is held outside the U.S.

Ashland 的流動性部位仍然非常強勁。截至季末，Ashland 約有 11 億美元的可用流動性，其中包含 4.92 億美元現金。其中大部分現金持有於美國境外。

With the Valvoline separation now complete, we have also provided recast Ashland-only adjusted EPS results for the first 9 months of fiscal 2017. These results, in addition to the earnings that we report for the fourth quarter, will serve as the baseline for the fiscal year 2018 to 2021 EPS growth targets that we announced at our Investor Day in early May.

隨著 Valvoline 分拆現已完成，我們也提供了 2017 會計年度前 9 個月、僅 Ashland 的重編（recast）調整後 EPS 結果。這些結果，加上我們將在第四季報告的獲利，將作為我們在 5 月初投資人日所宣布之 2018 至 2021 會計年度 EPS 成長目標的基準。

Now, I will turn the call back over to Bill.

現在，我把電話會議交回給 Bill。

Thank you, Kevin.

謝謝你，Kevin。

Looking ahead to our outlook for the fourth quarter. Within Specialty Ingredients, we expect sales to be in the range of $590 million to $610 million compared to $532 million in the year-ago quarter. Adjusted EBITDA is expected to be in the range of $135 million to $145 million versus $126 million in the year-ago quarter. And those increases are driven by the addition of Pharmachem, along with increasing momentum from pricing initiatives.

接下來談我們對第四季的展望。在 Specialty Ingredients 方面，我們預期銷售額將落在 5.90 億至 6.10 億美元之間，去年同期為 5.32 億美元。調整後 EBITDA 預期為 1.35 億至 1.45 億美元，去年同期為 1.26 億美元。這些成長主要來自 Pharmachem 的併入，以及定價措施帶來的動能提升。

Note that these gains will be partially offset by the exit in our fiscal fourth quarter of a joint venture in China which served the construction market. The full year impact of exiting this joint venture will be a little over $40 million in sales and about $3 million in adjusted EBITDA.

請注意，這些增益將部分被我們在本會計年度第四季退出一項位於中國、服務建築市場的合資企業所抵銷。退出該合資企業對全年影響為銷售額略高於 4,000 萬美元，以及約 300 萬美元的調整後 EBITDA。

For the fiscal year, Specialty Ingredients expects adjusted EBITDA to be at the upper end of the previously communicated range of $485 million to $500 million.

就全年而言，Specialty Ingredients 預期調整後 EBITDA 將位於先前溝通之 4.85 億至 5.00 億美元區間的上緣。

For Composites, we're expecting sales in the fourth quarter to be in the range of $200 million to $210 million, reflecting continued volume growth, disciplined pricing and a full quarter contribution from the Etain composites facility. This compares to $162 million in the year-ago quarter. Adjusted EBITDA is expected to be in the range of $20 million to $25 million compared to $14 million in the year-ago quarter.

在複合材料（Composites）方面，我們預期第四季銷售額將落在 2.00 億至 2.10 億美元之間，反映持續的銷量成長、嚴謹的定價，以及 Etain 複合材料廠完整一季的貢獻。相較之下，去年同期為 1.62 億美元。調整後 EBITDA 預期為 2,000 萬至 2,500 萬美元，去年同期為 1,400 萬美元。

Within I&S, we expect sales in the fourth quarter to be in the range of $75 million to $85 million, reflecting continued mix and price improvements, and that's compared to $60 million in the prior year-ago quarter. Adjusted EBITDA is expected to be in the range of $10 million to $15 million compared to $3 million in the year-ago quarter.

在 I&S 方面，我們預期第四季銷售額將落在 7,500 萬至 8,500 萬美元之間，反映持續的產品組合與價格改善；相較去年同期為 6,000 萬美元。調整後 EBITDA 預期為 1,000 萬至 1,500 萬美元，去年同期為 300 萬美元。

While we're speaking about I&S, I'd like to provide an update on the segment status. As you will recall, we said in our Investor Day that we would take action to reduce or eliminate the commodity volatility associated with this business during the long range plan period.

既然談到 I&S，我想就該事業部門的狀態提供最新進展。各位應該記得，我們在投資人日表示，將在長期計畫期間採取行動，以降低或消除此業務所伴隨的大宗商品波動。

As you know, Ashland has a bias for action. Also, Ashland keeps a laser focus on maximizing the value of assets. We currently believe the potential of this business is underappreciated and, thus, we're not likely to take action over the next several quarters. But rest assured, we remain steadfast regarding the commitments we've made on this part of our portfolio during our Investor Day.

如各位所知，Ashland 一向偏好迅速採取行動。此外，Ashland 也高度聚焦於資產價值最大化。我們目前認為市場低估了這項業務的潛力，因此在接下來幾個季度內，我們不太可能採取行動。但請放心，我們仍將堅定履行在投資人日就此一投資組合部分所做出的承諾。

So in summary, looking forward, Ashland is squarely focused on delivering strong earnings growth in the fourth quarter and beyond. Clearly, we expect to benefit from our recent acquisitions. In addition, our teams have made great progress with price-to-value initiatives and we now expect year-over-year price gains to be greater than raw material cost increases in the fourth quarter.

總結而言，展望未來，Ashland 將全力聚焦於在第四季及其後實現強勁的獲利成長。顯然，我們預期將受惠於近期的收購。此外，我們的團隊在價值定價（price-to-value）措施上已取得重大進展，我們現在預期第四季的年對年價格增幅將高於原物料成本增幅。

Looking out over the longer term, we announced aggressive new financial targets for fiscal year '18 through fiscal year '21 during the Ashland's Investment Day, which was -- Investor Day, which was held in early May. Those targets are adjusted earnings per share growth at a compound growth -- annual growth rate of at least 15%, adjusted EBITDA margins for Specialty Ingredients of at least 25% and cash generation of at least $1 billion in the aggregate.

從更長期來看，我們在 Ashland 的 Investment Day——也就是投資人日——於 5 月初舉行時，宣布了 2018 會計年度至 2021 會計年度的積極新財務目標。這些目標包括：調整後每股盈餘以至少 15% 的複合年成長率成長、Specialty Ingredients 的調整後 EBITDA 利潤率至少 25%，以及合計至少 10 億美元的現金創造。

These gains will be driven by 7 core levers which were outlined in the Investor Day presentation, which you can access on our website. The good news is that we're already making substantial progress towards executing on these strategic levers. For example, as you know, we have established a target of increasing our sales of new products to 30% of sales by 2020, and that's up from 25% today. This year, we have launched 22 new projects, realigned our R&D resources to support our Innova process within the business units and expanded our use of regional apps.

這些增益將由 7 項核心槓桿所驅動，相關內容已在投資人日簡報中說明，您可於我們的網站上取得。好消息是，我們已在執行這些策略槓桿方面取得實質進展。例如，如各位所知，我們已設定目標：到 2020 年將新產品銷售占比提升至銷售額的 30%，高於目前的 25%。今年，我們已啟動 22 個新專案，重新調整研發資源以在各事業單位內支援我們的 Innova 流程，並擴大區域型應用程式的使用。

We have also established comprehensive asset utilization projects to lower our production costs with a target of achieving minimum savings of $30 million over the long range plan period. To that end, we are currently working on significant in-sourcing opportunities to leverage available capacity and capabilities.

我們也已建立全面性的資產利用專案，以降低生產成本，目標是在長期計畫期間達成至少 3,000 萬美元的節省。為此，我們目前正推動具重大規模的內製（in-sourcing）機會，以運用可用產能與能力。

We're also targeting de-bottlenecking activities to increase output from our current footprint. Our recent capacity expansion at our Parlin, New Jersey facility is a good example of this type of work. With minimal capital, we were able to add about 3,000 metric tons or 30% capacity addition of Natrosol capacity related to Ashland's network. Use of this capacity will ultimately improve cost absorption, which will lower HEC production cost per unit.

我們也鎖定去瓶頸（de-bottlenecking）活動，以提高現有據點的產出。近期我們在新澤西州帕林（Parlin, New Jersey）廠的產能擴充，就是此類工作的良好例子。在資本支出極少的情況下，我們新增了約 3,000 公噸（metric tons），或相當於 Ashland 網路中 Natrosol 產能約 30% 的增量。使用這些產能最終將改善成本吸收，進而降低 HEC 的單位生產成本。

And finally, we are also aggressively assessing our footprint. To that end, during the quarter, we announced the closing of our plant in Dalton, Georgia. In each of these 3 areas, we have steering teams working aggressively to expand and accelerate our asset utilization actions and you should expect to hear more about these efforts and their impact in future calls.

最後，我們也正積極評估我們的據點布局。為此，在本季期間，我們宣布關閉位於喬治亞州道爾頓（Dalton, Georgia）的工廠。在這 3 個領域中，我們都有指導團隊積極推動，以擴大並加速資產利用行動；未來的電話會議中，您應可聽到更多關於這些努力及其影響的資訊。

So in conclusion, as we enter the fourth quarter, I feel good about the progress we have made against delivering our fiscal 2017 plan. We are focusing our actions to position Ashland for sales and earnings growth in this quarter and beyond and we see momentum building in a number key areas such as pricing where we expect to more than offset raw material inflation in the fourth quarter, innovation where we are benefiting from recent product releases, asset utilization where we are already beginning to see a reduction in cost per unit.

總結而言，當我們進入第四季時，我對我們在推進 2017 會計年度計畫交付方面所取得的進展感到樂觀。我們正聚焦各項行動，以在本季及未來為 Ashland 的銷售與獲利成長做好定位；我們也看到多個關鍵領域的動能正在形成，例如定價方面，我們預期在第四季可不僅抵銷原物料通膨；創新方面，我們正受惠於近期產品上市；資產利用方面，我們已開始看到單位成本下降。

Given these factors and the benefit of our recent acquisitions, we are confident that we can meet our outlook for Q4 and target a 15% adjusted EPS compound annual growth rate in the long range plan period. Note we plan to share more details about our outlook for fiscal year 2018 when we report our year-end earnings later this fall.

基於上述因素以及近期併購帶來的效益，我們有信心能達成第四季展望，並在長期計畫期間以 15% 的調整後 EPS 複合年成長率為目標。請注意，我們計畫在今年秋季稍晚公布年終財報時，分享更多關於 2018 會計年度展望的細節。

So to sum it up, we have the right team and strategy in place, we are executing at a high level to deliver on our commitments and we believe that these efforts should create value for our shareholders and capitalize on Ashland's position as a leading premier specialty chemicals company.

因此總結來說，我們已具備正確的團隊與策略，並以高水準執行以履行承諾；我們相信這些努力將為股東創造價值，並充分發揮 Ashland 作為領先頂尖特用化學品公司的地位。

I 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) Our first question comes from David Begleiter of Deutsche Bank.

(接線員指示) 我們的第一個問題來自德意志銀行（Deutsche Bank）的 David Begleiter。

Just on ASI, the volume growth did decelerate from the prior quarter to 1% for the entire segment. Could you give a little more color -- and I mention architectural -- a little more region, maybe products, a little more detail as to why the decel in Q3 versus Q2?

關於 ASI，整個事業部的銷量成長確實從上一季放緩至 1%。能否提供更多說明——我提到建築（architectural）——例如按地區、可能按產品，提供更細的資訊，說明為何第三季相較第二季出現放緩？

Sure. Well, first of all, as you mentioned, the demand for materials going into architectural coatings has softened and so that, we'll say, quieted some of the positive impact that we have been seeing in the Industrial segment that have been a big source of volume gained through the first half of the year. We had a pretty tough comp after a really strong growth in the prior year period in the hair care segment, so that was relatively flat. But all in all, I would say that we don't see any fundamental shifts outside of what you read about the architectural coatings market in terms of our position or our end markets.

當然。首先，如你所提到的，進入建築塗料（architectural coatings）的材料需求已轉弱，因此我們在工業（Industrial）事業部於上半年所看到、且一直是銷量成長重要來源的正面影響，某種程度上被壓抑了。在護髮（hair care）事業方面，由於去年同期成長非常強勁，基期相當具挑戰，因此表現相對持平。但整體而言，我會說，除了你在建築塗料市場相關報導中所讀到的內容之外，我們並未看到就我們的競爭地位或終端市場而言有任何根本性的變化。

Do you expect volumes to pick up in Q4 in this segment year-over-year?

你是否預期該事業部的銷量在第四季會以年增的方式回升？

It's a little bit difficult to predict because of the dynamics that we mentioned just a -- that I mentioned just a couple of minutes ago. Good news is we will have, at least it appears, FX helping us on an FX adjusted basis, so that should help to accelerate sales growth. But we're focused on the things that we can control and the things that we can control are things like pricing, asset utilization, introducing new products and those are the things that we're focused on. The demand profile of the market is always a little bit difficult to predict in advance.

這有點難以預測，因為存在我們剛才——我在幾分鐘前提到的那些動態因素。好消息是，至少看起來外匯（FX）將在外匯調整後（FX adjusted）基礎上對我們有利，因此應有助於加速銷售成長。但我們專注於可控的事項，而可控的事項包括定價、資產利用、推出新產品等，這些就是我們目前聚焦的重點。市場的需求輪廓一向較難事先精準預測。

Our next question comes from Christopher Parkinson of Credit Suisse.

我們的下一個問題來自瑞士信貸（Credit Suisse）的 Christopher Parkinson。

Kieran on for Chris right now. Can you walk us through some of the trends you're seeing in hair care, coatings and adhesives? I understand that there have been some difficult comps to the strong sales last fiscal year, but just walk us through what you are seeing and hearing from customers. In particular, as one of your competitors, I think, mentioned that they were seeing some share gains.

我現在代表 Chris，由 Kieran 提問。你能否帶我們了解一下你在護髮、塗料與黏著劑（adhesives）方面看到的一些趨勢？我理解相較去年會計年度強勁銷售，基期較具挑戰，但請說明你從客戶那裡看到與聽到的情況。特別是，我想你們的一位競爭對手提到他們看到一些市占提升。

Sure. The adhesives sales on FX adjusted basis were up about 1%, relatively flat without the benefit of FX. Certainly, we haven't seen any fundamental changes in the dynamics of that market space or our respective position. And from a coatings demand profile or architectural coatings, of course, I'd rather -- you may want to read what some of the companies are saying in terms of their demand profile. And as they have increased demand, we tend to increase with it. And when their markets are a little slower, we follow them as well. So that's why I emphasize really nothing that fundamental that I see in terms of shifts of our position. So I'd like to provide more clarity, but if you'd like to ask a little more, I hope that provided an answer for you.

好的。黏著劑在外匯調整後的銷售約成長 1%；若不考慮外匯效益，則相對持平。當然，我們並未看到該市場空間的動態或我們相對競爭地位出現任何根本性的變化。至於塗料需求輪廓或建築塗料，當然，我寧可——你可能需要參考一些公司對其需求輪廓的說法。當他們的需求增加時，我們通常也會隨之增加。而當他們的市場稍微放緩時，我們也會跟著放緩。因此我才強調，就我們的競爭地位而言，我沒有看到任何根本性的位移。我希望能提供更清楚的說明；但如果你想再追問一些細節，我希望以上已回答你的問題。

That's fine. And then, I guess, just within hair care, are you seeing any benefits from new product introductions and how you view that, I guess, accelerating or growing into 2018?

可以。那麼我想再問護髮方面，你們是否從新產品導入中看到任何效益？以及你如何看待這些效益在 2018 年加速或帶動成長？

Yes. For hair care, again, I'd like to emphasize, we're really coming off of what we would consider to be a tough comp, but we are certainly increasing and moving forward with some new product launches. I mentioned earlier the hair brands, which I think is important. And in addition, we have a new acrylate-based fragrance encapsulation technology called Method and our customer is using it to help boost, if you will, the scent that's in the products. And it's currently in product that is being sold and sold through Target. So we do have new products in this area and that's, in general, in personal care. For the hair care product, I would really point to the hair brands. But in general, in personal care, innovation is a core theme and we've had a number of great successes, I think, over the last quarter or 2.

是的。護髮方面，我想再次強調，我們確實是從我們認為相當具挑戰的基期走過來，但我們也確實正在加速並推進一些新產品上市。我先前提到的 hair brands（護髮品牌）我認為很重要。此外，我們有一項新的丙烯酸酯（acrylate）基香氛包覆（fragrance encapsulation）技術，名為 Method；我們的客戶正使用它來協助提升產品中的香味表現。目前它已應用於正在銷售的產品中，並透過 Target 通路銷售。因此我們在這個領域確實有新產品，而這也更廣泛地涵蓋在個人護理（personal care）之中。就護髮產品而言，我會特別指向 hair brands。但整體來看，在個人護理領域，創新是核心主題；我認為在過去一到兩季，我們已取得多項很好的成功。

Our next question comes from Mike Sison of KeyBanc.

我們的下一個問題來自 KeyBanc 的 Mike Sison。

When you say -- I know it's a little bit early probably to give a specific guidance for '18, but when you think about Specialty Ingredients, meaning the greater than 25% goal, you have Pharmachem in there, what else do you think you need to hit that bogey in '18 given what you see today?

當你說——我知道現在可能還有點早，未必能對 2018 年給出具體指引——但當你談到 Specialty Ingredients（特種成分），也就是超過 25% 的目標時，裡面包含 Pharmachem；就你目前所見，2018 年要達到那個目標，你覺得還需要什麼？

Sure. So first of all, I mean, just to be clear, we set out the targets in our long range plan for the entire periods, not that that's meant to be back end loaded. We expect to make continued progress. I think the levers that we would pull are the ones that we identified in our Investor Day. We've got to continue to drive the value that we're creating in terms of pricing. We need to increase the role of new products and I think we're making a lot of progress in that area. And in terms of driving better asset utilization and lowering our cost per unit, that definitely improves the fundamental economics of our business and will help with our gross margins. And by growing the business and keeping our SG&A flat, you get leverage on the overhead. So you put all that together and those are really the primary levers that we see in terms of allowing us to get to higher margins and the targets that we've set out.

當然。首先，我想先澄清一下：我們在長期計畫中設定的是涵蓋整個期間的目標，並不是說要把成果集中在後段。我們預期會持續取得進展。我認為我們會拉動的槓桿，就是我們在投資人日所指出的那些。我們必須持續推動我們在定價方面所創造的價值。我們需要提高新產品的比重，而我認為我們在這方面已經取得很大進展。此外，在提升資產使用率、降低單位成本方面，這確實能改善我們業務的基本經濟性，並有助於提升毛利率。而透過擴大業務規模並維持 SG&A（銷售、一般及行政費用）持平，你就能在間接費用上取得槓桿效益。把這些綜合起來，這些就是我們認為能讓我們達到更高利潤率以及既定目標的主要槓桿。

Great. And then, Composites was pretty impressive. Profitability there looks pretty good. What do you think the growth rate for that business should be on a consistent basis going forward?

很好。另外，Composites（複合材料）表現相當亮眼。那邊的獲利能力看起來相當不錯。你認為該業務未來在較一致、可持續的基礎上，成長率應該是多少？

I think we view that as kind of a global industrial GDP type of number. It did have a number of nice share gains recently associated with some technology that we have in the kind of the countertop materials where we have some innovations that are helping manufacturers with their productivity. We also have a new gelcoat which is helping in terms of weathering resistance, and that's important to, say, the boat industry. So yes, the overall market should move at that kind of industrial GDP rate.

我想我們把它視為一個接近全球工業 GDP 的數字。近期確實有一些不錯的市占提升，與我們在檯面材料等領域的一些技術相關；我們有些創新正在幫助製造商提升生產力。我們也有一款新的膠衣（gelcoat），在耐候性方面有所助益，這對例如船舶產業很重要。所以是的，整體市場應該會以那種工業 GDP 的速度成長。

And I would also emphasize that while growth is a good and important component for the Composites business, as we outlined in our Investor Day, really the team has focused most specifically on improving the profitability of the business. You see that in the results this quarter. You see it in the results over the past 4, 5 years and that's really the fundamental focus. And, of course, they're also a great cash generator and they're focused on driving that cash -- cash flow as well. So it was a great quarter for them.

我也要強調，雖然成長是 Composites 業務一個良好且重要的組成部分，但如同我們在投資人日所說，團隊最聚焦的是提升該業務的獲利能力。你可以在本季的結果看到。你也可以在過去 4、5 年的結果中看到，而那才是真正的基本重點。當然，他們也是很強的現金創造者，並且也專注於推動現金——也就是現金流。所以這對他們而言是很棒的一季。

Our next question comes from Laurence Alexander from Jefferies.

我們的下一個問題來自 Jefferies 的 Laurence Alexander。

Two questions. First, for ASI, if you had bundled in the consolidated business on like 100% basis, roughly how are -- how is price mix doing?

兩個問題。第一個，對於 ASI，如果你把合併後的業務以 100% 基礎打包來看，大致上價格/組合（price mix）的表現如何？

And secondly, as we think about 2018, if we want to back out the deal amortization, is $92 million a good run rate for next year based on what you pegged for Q3? Or is it -- or should we be thinking of a different number?

第二個，當我們思考 2018 年時，如果把交易攤銷（deal amortization）扣除掉，依照你對 Q3 所設定的水準，明年以 9,200 萬美元作為一個合理的年化水準（run rate）嗎？還是——我們應該用不同的數字來看？

So Laurence, you're asking deal amortization only for Pharmachem or for all of ASI?

Laurence，你問的交易攤銷是只針對 Pharmachem，還是 ASI 全部？

Well, just to make it comparable to the -- your comment in your opening remarks about if you had backed out the amortization, the underlying EPS would have been. I just wanted to kind of make a comparable benchmark.

嗯，我只是想讓它能和——你在開場談到的那段評論可比：如果把攤銷扣除，基礎 EPS 會是多少。我只是想建立一個可比的基準。

So, I mean, if you look at the entire business, which ASI is the, obviously, the biggest driver, if you had completely backed out deal amortization, EPS would have been $0.23 higher or $1.06 per diluted share in the quarter.

所以，我的意思是，如果你看整體業務（其中 ASI 顯然是最大的驅動因素），如果完全扣除交易攤銷，本季 EPS 會高出 0.23 美元，也就是稀釋後每股 1.06 美元。

And relative to Pharmachem, based upon purchase price allocation and all that, we would expect incremental D&A per quarter to be about $6 million going forward. So having a full year -- or full quarter, rather, of D&A for Pharmachem in Q4 would be about $6 million higher.

至於 Pharmachem，基於購買價格分攤（purchase price allocation）等因素，我們預期未來每季新增的折舊與攤銷（D&A）約為 600 萬美元。因此，在 Q4 若 Pharmachem 有完整一季的 D&A，將會高出約 600 萬美元。

And then, secondly, to your first question, if you will, that we clearly have seen significant raw material inflation through the year. If you look at between raw material and currency, that's been about $20 million for ASI. And we're not talking that much about it because we're really focused more on the things we can control and the actions to offset and drive to meet our targets.

再來，回到你的第一個問題：我們今年確實看到顯著的原物料通膨。如果把原物料與匯率一起看，對 ASI 的影響約為 2,000 萬美元。我們之所以沒有花太多時間談這個，是因為我們更專注在我們能控制的事情，以及用行動去抵銷並推動達成目標。

The good news is that the team has been working on pricing activities and, obviously, working to upgrade its mix. While it's still was net price versus raw material inflation on the year-over-year basis, negative for us, at least within ASI, in the quarter, we see that that's, I'll say, neutralized, if not becoming a positive by the fourth quarter.

好消息是，團隊一直在推動定價行動，並且顯然也在努力改善其產品組合。雖然以年對年來看，至少在 ASI 內部，淨價格相對於原物料通膨仍對我們不利，但在本季我們看到這個影響已經——我會說——被中和了；若不是在第四季轉為正面，也至少接近轉正。

Do you think that sort of roughly one-quarter-lag as a good rule of thumb for the new portfolio or what's...

你認為對於新的產品組合來說，大致上「落後一季」可以作為一個經驗法則嗎？還是……

I think, in this particular case, what we've seen is that, for example, in Composites where you had a fundamental event that structurally changed the price, it was about a one quarter lag to kind of work that through the system. I think when you see a general trend of raw materials increasing, it depends upon the end market, but what we've seen is actually it takes a couple of quarters to kind of get the full benefit of what you're pushing forward.

我想在這個特定案例中，我們看到例如在 Composites，當你遇到一個從根本上、結構性改變價格的事件時，大約會落後一季，才能把它在系統中消化完。我認為當你看到原物料普遍上漲的趨勢時，會取決於終端市場；但我們看到的其實是，需要幾個季度，才能充分取得你所推動措施的全部效益。

Our next question comes from John Roberts of UBS.

我們的下一個問題來自 UBS 的 John Roberts。

On Slide 25, in the appendix, the majority of I&S sales are derivatives. Is that dominated by one or 2, like THF? Or is that a diversified set of derivatives?

在附錄的第 25 頁投影片，I&S 的銷售大多是衍生品。這主要是由一兩項產品主導，例如 THF 嗎？還是說是多元分散的一組衍生品？

It's primarily one or 2.

主要是一兩項。

Yes.

是的。

It's a relatively small group.

是一個相對小的產品群。

THF and NMP would be the 2 primary.

THF 和 NMP 會是兩個主要的。

Got it.

了解。

In addition to the BDO sales.

另外還有 BDO 的銷售。

And then, on Slide 15, the bridge for I&S, price was up 6% or about almost $4 million year-over-year, but margin was only up $1 million. Was it settling up a lot? Or what's the driver of the raw's change there that offset most of the price?

然後在第 15 頁投影片，I&S 的橋接分析中，價格年對年上升 6%，約將近 400 萬美元，但利潤只增加了 100 萬美元。是因為結算調整（settling up）很多嗎？還是那邊原料變動的驅動因素是什麼，抵銷了大部分的漲價？

We did see raw materials negatively impact on a year-over-year basis. And I think that it's -- we use a variety of raw materials depending upon the plant that we're producing out of, but certainly butane has been one that has contributed to that year-over-year raw material inflation.

我們確實看到原物料在年對年的基礎上帶來負面影響。我想——我們會依據不同的生產工廠使用各式各樣的原物料，但丁烷（butane）確實是造成這個年對年原物料通膨的因素之一。

Yes. And the plants ran well in the quarter and SG&A has been very consistent in that business. It's really raws-based.

是的。而且本季工廠運轉良好，該業務的銷售、一般及行政費用（SG&A）一直非常穩定。基本上是以原料為基礎的。

And then, lastly, as you sort of delay taking strategic actions here with I&S, what do you think you can do? And how much can you improve the profitability and/or reduce volatility in that business?

然後最後，當你們在 I&S 這邊某種程度上延後採取策略性行動時，你認為你們能做些什麼？你們能在多大程度上提升該業務的獲利能力和／或降低波動性？

Sure. Well, the good news is, again, we believe the fundamentals, supply/demand appear to be moving in a more positive direction. This is pretty consistent with what we've been saying the way along. And if you look at the trailing 12 months in that business, through quarter 2, we have about $15 million of EBITDA in the business and we had $10 million in Q3 and we're saying between $10 million and $15 million in Q4. So that's one of the reasons why we say it's important. We believe that, and we've said all along, that this is actually can be a great business through the cycles. It's just different because it has that cyclicality. So it's important that we take whatever action we choose to take at the right time to kind of maximize the benefit that's associated with the business.

當然。好消息是，我們再次認為基本面，也就是供需，看起來正朝更正面的方向發展。這與我們一路以來所說的相當一致。如果你看該業務過去 12 個月（截至第二季），我們約有 1,500 萬美元的 EBITDA；第三季是 1,000 萬美元；而我們對第四季的看法是介於 1,000 萬到 1,500 萬美元之間。所以這也是我們說它很重要的原因之一。我們相信，而且我們一直以來也都說過，這其實可以是一個能穿越景氣循環的很好的業務。只是它不同之處在於具有週期性。因此，我們必須在適當的時點採取我們選擇的任何行動，以便在某種程度上把與該業務相關的效益最大化。

Our next question comes from Jeff Zekauskas of JP Morgan.

下一個問題來自摩根大通（JP Morgan）的 Jeff Zekauskas。

Just a couple of questions on Specialty Ingredients. My guess is that, with Pharmachem at $36 million in revenues, maybe that would have added 5,000 tons to your volume and so maybe your organic volume was 79,000 tons or down about 3.5%. And for the fourth quarter, your revenue expectation of $610 million is -- I'm sorry, of -- in the midpoint at $600 million is $10 million higher, but you had a $36 million benefit from holding Pharmachem for half the quarter. So you would think that the sales would be far stronger. Is your organic volume and ingredients shrinking at about 3.5%? And if it is, why is it doing that?

關於 Specialty Ingredients 我有幾個問題。我猜，Pharmachem 的營收是 3,600 萬美元，可能為你們的銷量增加了 5,000 噸，因此你們的有機銷量可能是 79,000 噸，或是下滑約 3.5%。而對第四季而言，你們的營收預期是 6.10 億美元——抱歉，是——中位數 6.00 億美元高出 1,000 萬美元，但你們因為持有 Pharmachem 半個季度而有 3,600 萬美元的貢獻。所以你會以為銷售應該強很多。你們的有機銷量與原料（ingredients）是否正在以約 3.5% 的幅度縮減？如果是，為什麼會這樣？

Yes. So -- and maybe this is -- well, let's try to find a way to provide just a little more clarity because there was not a contraction in the ASI organic, if you will. It was relatively flat quarter-over-quarter. And we did, if you will, within the Consumer Specialties area, we saw that it was relatively flat; and with Industrial, it was down 1%, but one -- relatively flat. So I'm not sure how you're coming up with the contraction that you're outlining there. And Pharmachem volume was about 2,000. So I don't know if that helps you with your math.

是的。所以——也許這是——嗯，我們試著提供更清楚一點的說明，因為如果你指的是 ASI 的有機部分，其實並沒有收縮。與上一季相比相對持平。而且如果你看 Consumer Specialties（消費者特殊品）領域，我們看到也是相對持平；Industrial（工業）則下滑 1%，但——也算相對持平。所以我不太確定你是怎麼算出你剛才提到的那個收縮幅度。Pharmachem 的銷量大約是 2,000。所以不知道這樣是否能幫助你重新計算。

If you could go to the second part of the question just because it was -- I want to make sure it was a little detailed.

你能不能回答問題的第二部分，因為那部分——我想確保細節更清楚一些。

So the -- so, I guess, another way of asking it is how many tons did Pharmachem contribute in the quarter and...

所以——我想換個方式問：Pharmachem 在本季貢獻了多少噸，以及……

It's about 2,000 tons, Jeff.

大約 2,000 噸，Jeff。

2,000 tons? Okay.

2,000 噸？好。

Yes, right around that.

是的，大概就在那個水準。

Okay. And if the -- if your midpoint of the revenues for the fourth quarter is $600 million and you did $591 million in this quarter and you got a $36 million benefit for owning Pharmachem for half the quarter, presumably there's an additional $36 million that would get in the fourth quarter, order of magnitude. So you're -- like, even if you didn't grow your revenues in the fourth quarter, it should be something like $626 million. So $90 million to $610 million seems low given you're going to have an additional $36 million or $30 million or something of Pharmachem revenues in the fourth quarter.

好。如果你們第四季營收中位數是 6.00 億美元，而本季是 5.91 億美元，且你們因為持有 Pharmachem 半個季度而有 3,600 萬美元的貢獻，那麼第四季大概會再多出 3,600 萬美元的量級。所以——像是即使你們第四季營收不成長，也應該接近 6.26 億美元。因此 5.90 億到 6.10 億看起來偏低，因為你們第四季會多出 3,600 萬或 3,000 萬之類的 Pharmachem 營收。

Right. If you look at the business, there's some seasonality that starts to come into play in our fiscal fourth quarter. So that's every year. And so if you look at it on a year-over-year basis, you will see that.

對。如果你看這個業務，我們的會計年度第四季會開始出現一些季節性因素。每年都是如此。所以如果你用年對年來看，你會看到這一點。

The other piece of the equation would be the joint venture that we exited. A round number is that's around $10 million or so of sales per quarter and so that would also come out of the number. And you are correct. We would expect incremental sales revenue from Pharmachem to be additive to the quarter as well.

另外一個因素是我們退出的那個合資企業。粗略來說，那大約是每季 1,000 萬美元左右的銷售額，因此這部分也會從數字中扣除。而你說得沒錯。我們也預期 Pharmachem 的增量銷售營收會對該季度形成加成。

Okay. And then, lastly, the cash flow from operations that you show in your press release is $114 million for the 9 months, but in your Q for the second quarter, it was $62 million for the first 2 quarters and now you add $132 million. So like it should -- so without restatement, it should be $194 million, not $114 million. How do we get from $194 million to $114 million?

好。最後，你們新聞稿中顯示的營運活動現金流在 9 個月為 1.14 億美元，但在第二季的 Q（季度）資料中，前兩季是 6,200 萬美元，而現在你又加了 1.32 億美元。所以——也就是說，在不重編的情況下，應該是 1.94 億美元，而不是 1.14 億美元。我們要怎麼從 1.94 億美元變成 1.14 億美元？

I think Valvoline was probably included in those first ones. So you got to back that out.

我想前面那些數字可能包含了 Valvoline。所以你得把那部分扣掉。

Okay. So that's...

好。所以那是……

It's a little messy at this point.

目前這有點混亂。

(Operator Instructions) Our next question comes from Mike Harrison of Seaport Global.

（接線員指示）下一個問題來自 Seaport Global 的 Mike Harrison。

I was wondering if you can talk a little bit about the pricing environment, particularly in the Specialty Ingredients business? We've heard some companies talk about challenges getting pricing as quickly as they had hoped. Were there areas where you were more successful and areas where you struggled? And is there a chance that your efforts to get pricing maybe meant that you sacrificed some volume growth there?

我想請你談談定價環境，特別是在 Specialty Ingredients 業務方面。我們聽到一些公司提到，取得定價（調價）進展沒有他們原先希望的那麼快，面臨一些挑戰。你們在哪些領域比較成功、哪些領域比較吃力？另外，你們爭取定價的努力是否可能意味著你們在那裡犧牲了一些銷量成長？

I would say that within industrial, it is less. It's always a challenge, but it's less pronounced that challenge in the personal care and pharma and nutrition area. It's really more in the industrial space where, as you can imagine, it's challenging. And any time you go forward with price increases or take a lead, it's important to sell the value and you're never going to get price unless you are willing to take some risks in terms of volume or share. That being said, that's not our strategy to lose volume or share for price. We're really focused on the value-added products that we can provide, the value-added services and, ultimately then, selling that value. And it takes time, but -- and there's always risk. I mean, that's why we put a range into our forecast, but we're not viewing that at this moment as being a problem in the quarter going forward.

我會說在工業領域相對沒那麼嚴重。這一直都是挑戰，但在個人護理、製藥以及營養領域，這種挑戰沒有那麼明顯。真正更偏向是在工業領域，你可以想像，那裡確實比較具挑戰性。而且任何時候你推動漲價或率先調價，重點在於要把價值賣出去；除非你願意在銷量或市占方面承擔一些風險，否則你永遠拿不到價格。話雖如此，我們的策略並不是為了價格而犧牲銷量或市占。我們真正聚焦的是我們能提供的加值產品、加值服務，最終把這些價值賣出去。這需要時間，但——而且總是有風險。這也是為什麼我們在預測中給了一個區間；但就目前而言，我們不認為這會成為未來季度的問題。

Got it. And then, in terms of the Pharmachem business, you mentioned $0.03 to $0.04 contribution for the fourth quarter. Is that $0.03 to $0.04 EPS contribution, is that the right run rate for accretion for -- as we move through fiscal '18 or should that accelerate? Any thoughts there?

了解。接著，就 Pharmachem 業務而言，您提到第四季貢獻為 0.03 至 0.04 美元。這 0.03 至 0.04 美元是指 EPS 的貢獻嗎？這是否是我們進入 2018 財年時增厚（accretion）的正確常態水準，還是會加速？對此有何看法？

I would say, ex-synergies, that's a good number to use roughly.

我會說，若不計協同效益（ex-synergies），大致上用這個數字是合理的。

I guess, I'm looking for -- including synergies, kind of where do we accelerate that $0.03 to $0.04 number to over the course of fiscal '18?

我想問的是——若包含協同效益，2018 財年期間那個 0.03 到 0.04 的數字大概會加速到什麼程度？

I mean, synergy should be modestly accretive to that, but generally speaking, I'd call it $0.03 to $0.04 is probably the right number to use.

我的意思是，協同效益應該會讓它有小幅增厚，但一般來說，我會說 0.03 到 0.04 可能就是應該採用的正確數字。

What we stated previously is that we're targeting about $10 million worth of synergies. And it takes a little time to get that. I think it's, as you asked that question, it's important time to take a pause and say that one of the things that will be challenging for us is that we really are integrating the businesses. And with that, the financials with ASI are going to be becoming increasingly intertwined. I think we'll have pretty good visibility on the revenue because we can track that as we move forward, but it's going to be more difficult in terms of calling out the specific contribution of Pharmachem. And so we'll really be focusing more on the aggregate for the system from an earnings perspective.

我們先前提到，我們的目標是約 1,000 萬美元的協同效益。而要達成需要一些時間。我認為，當你問這個問題時，重要的是先停一下並說明：對我們而言具挑戰的一點是，我們確實正在整合這些業務。因此，與 ASI 相關的財務數字將會愈來愈交織在一起。我想我們對營收會有相當好的能見度，因為我們可以在推進過程中追蹤，但要明確指出 Pharmachem 的特定貢獻會更困難。因此，從獲利角度來看，我們將更著重於整個系統的合計表現。

Our next question is from Jim Sheehan of SunTrust.

我們的下一個問題來自 SunTrust 的 Jim Sheehan。

With regard to ASI, I'd like to ask you about your gross margins, ex-Pharmachem. I understand your Pharmachem margins are probably below the average. How did your margins look just on a core, excluding acquisitions, basis? And also if you could comment on how pricing developed during the quarter. It probably takes 2 full quarters to fully offset raw materials. Did you see your pricing versus raw materials spread in the quarter at the run rate you basically expected?

關於 ASI，我想請教你們不含 Pharmachem（ex-Pharmachem）的毛利率。我理解 Pharmachem 的毛利率可能低於平均。若僅看核心業務、排除併購的基礎上，你們的毛利率表現如何？另外也請評論本季定價的發展情況。要完全抵銷原物料成本通常需要 2 個完整季度。本季你們看到的「定價相對原物料」的價差，是否如你們基本預期的常態水準？

Okay. So first of all, in terms of the Pharmachem and its contribution relative to our gross margin, I don't think it had a major shift on the gross profit margins itself. And in general, we were able to maintain our gross profit margins on the context of that raw material inflation. And I think that that's important because that took action for us to take on other parts of the business. And so I'd like to, first of all, emphasize that.

好的。首先，就 Pharmachem 及其相對於我們毛利率的貢獻而言，我不認為它對毛利率本身造成了重大變動。整體而言，在原物料通膨的背景下，我們仍能維持毛利率。我認為這點很重要，因為這需要我們在業務的其他部分採取行動。所以我想先強調這一點。

And I'm sorry, the second part of your question -- the momentum at the end of the quarter. I think when you look at it, we see momentum building. I mean, that's what we said and we also talked about raw material prices versus prior year. And I believe roughly about this time last year, you began to see some raw material price increases. So when we compare on a year-to-year basis, those 2 factors kind of come together and converge. And that's why, right now, in our view, ASI should have better price to raw material costs in the aggregate for Q4.

抱歉，你問題的第二部分——關於季度末的動能。我認為從結果來看，我們看到動能正在累積。我的意思是，這就是我們所說的，我們也談到原物料價格相較去年同期的情況。我相信大約在去年這個時候，你開始看到一些原物料價格上漲。因此，當我們做年對年比較時，這兩個因素會在某種程度上相互靠攏並匯合。也因此，就我們目前的看法，ASI 在第四季整體而言應該會有更好的「售價相對原物料成本」表現。

Great. And you mentioned some of the trends you're seeing in coatings, pharmaceuticals and energy. Can you also comment on your end markets in construction and nutrition? What did organic growth look like there? And how does your innovation pipeline look for the next several quarters?

很好。你提到你們在塗料、製藥與能源看到的一些趨勢。也能否評論一下你們在建築與營養等終端市場的情況？那裡的有機成長表現如何？以及未來幾個季度你們的創新產品管線看起來如何？

Yes. The construction market was not strong in the quarter. It has actually down. So -- and as you heard, going forward, I mean, ultimately, we're going to be exiting the joint venture in China that was focused on construction.

是的。本季建築市場表現不強。實際上是下滑的。所以——而且如你所聽到的，往前看，我們最終將退出在中國、聚焦建築領域的合資企業。

In terms of the nutrition business, it was down a little bit, but not a lot, relatively flat year-over-year, a percent or 2 down.

至於營養業務，略有下滑，但不多，年對年大致持平，約下降 1% 或 2%。

Great. And a competitor of yours mentioned an Easter shift this year, which hurt sales in the current quarter or the quarter just past. Is that something that would have impacted Ashland as well?

很好。另外，你們的一家競爭對手提到今年復活節時間點的移動，對本季或剛過去的那一季銷售造成不利影響。這是否也會影響到 Ashland？

I can't call that out. I'd like to say yes, but I can't call that out specifically.

我無法就此做出明確說明。我想說會，但我無法具體點出。

This concludes the Q&A portion.

問答部分到此結束。

I'd like to turn the call back over to Seth Mrozek for closing remarks.

我想把電話會議交回給 Seth Mrozek 作結語。

Thank you, Norma. Thank you, all, for your time this morning and your interest in Ashland. Have a great day.

謝謝你，Norma。也謝謝各位今天早上撥冗參與，以及對 Ashland 的關注。祝各位有美好的一天。

Ladies and gentlemen, thank you for your participation in today's conference. You may disconnect. Have a wonderful day.

各位女士、先生，感謝各位參與今天的會議。您現在可以掛線。祝各位有美好的一天。