Ashland Inc. (ASH) 2019 Q2 法說會逐字稿

Good morning, ladies and gentlemen, and welcome to the Ashland Global Holdings Inc. Second Quarter Earnings Call. (Operator Instructions) As a reminder, this conference call is being recorded.

各位女士、先生，早安，歡迎參加 Ashland Global Holdings Inc.第二季財報電話會議。(接線員指示) 提醒各位，本次電話會議將被錄音。

I would now like to turn the conference over to your host, Mr. Seth Mrozek, Director of Investor Relations.

現在我想將會議交給本次會議主持人——投資人關係總監 Seth Mrozek 先生。

Thank you, Bella. Good morning, everyone, and welcome to Ashland's Second Quarter Fiscal 2019 Earnings Conference Call and Webcast. My name is Seth Mrozek, Director of 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.

謝謝你，Bella。各位早安，歡迎參加 Ashland 2019 會計年度第二季財報電話會議與網路直播。我叫 Seth Mrozek，Ashland 投資人關係總監。今天與我一同出席的有 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 March 31, 2019, shortly after 5:00 p.m. Eastern Time yesterday, April 30. Additionally, we posted slides 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 4 月 30 日美東時間下午 5:00 過後不久，發布截至 2019 年 3 月 31 日止季度的初步業績。美東時間昨日，4 月 30 日。此外，我們也在網站 ashland.com 的投資人關係專區上傳了簡報，並已以 Form 8-K 形式將上述文件提交給美國證券交易委員會（SEC）。

As a reminder, during today's call, we will be making forward-looking statements on a number of matters, including our financial guidance for fiscal 2019. These forward-looking statements are subject to risks and uncertainties that could cause future results or events to differ materially from today's projections. We believe any such statements are based on reasonable assumptions but cannot assure that such expectations will be achieved. Please refer to yesterday's slide presentation for a fuller explanation of those risks and uncertainties and the limits applicable to forward-looking statements.

提醒各位，在今天的電話會議中，我們將就多項事項發表前瞻性陳述，包括我們對 2019 會計年度的財務指引。這些前瞻性陳述存在風險與不確定性，可能導致未來結果或事件與今日預測出現重大差異。我們相信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。請參閱昨日的簡報，以更完整了解上述風險與不確定性，以及前瞻性陳述所適用的限制。

Please also note that we will be referring to certain actual and projected financial metrics of Ashland on an adjusted basis, which are non-GAAP financial measures. We will refer to these measures as adjusted and present them in order to supplement your understanding and assessment of the financial performance of our ongoing business. Non-GAAP measures should not be considered a substitute for or superior to financial measures calculated in accordance with GAAP. The most directly comparable GAAP measures as well as reconciliations of the non-GAAP measures to those GAAP measures are available on our website and in the appendix of yesterday's slide presentation.

另請注意，我們將以調整後基礎（adjusted basis）引用 Ashland 的部分實際與預測財務指標，該等指標屬於非 GAAP 財務衡量指標。我們將稱之為「調整後」並加以呈現，以補充各位對我們持續經營業務財務表現的理解與評估。非 GAAP 指標不應被視為依 GAAP 計算之財務指標的替代或更優者。與之最直接可比的 GAAP 指標，以及非 GAAP 指標與 GAAP 指標之間的調節表，已公布於我們網站及昨日簡報的附錄中。

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

接下來，我把電話交給 Bill。

Good morning, everyone. There has been a lot happening this quarter, both internally and externally, so I'm going to make my comments brief, and that will allow us to get to your questions quickly.

各位早安。本季內外部都有許多事情發生，因此我會簡要說明，讓我們能更快進入問答環節。

In a moment, I'll discuss the solid progress we have made on very important operating initiatives, but before I do, it's important to profile 3 external factors which worked against us in the quarter. The first is the continuing strengthening of the U.S. dollar, which negatively impacted ASI revenue by over $25 million and EBITDA by $9 million on a year-to-date basis, of which $18 million of revenue and $6 million of EBITDA was in Q2.

稍後我會談到我們在非常重要的營運倡議上取得的扎實進展，但在此之前，有必要先說明本季對我們不利的三項外部因素。第一項是美元持續走強，按年初至今計算，對 ASI 營收造成超過 2,500 萬美元的負面影響，對 EBITDA 造成 900 萬美元的負面影響；其中第二季（Q2）分別為 1,800 萬美元營收與 600 萬美元 EBITDA。

The second is in-market demand. Emerging in Q2, we experienced relatively flat demand in coatings, adhesives and performance specialties which is consistent with the performance of our customers and peers but below our expectations.

第二項是終端市場需求。在第二季開始顯現，我們在塗料、黏著劑與性能特用化學品方面的需求相對持平，這與我們客戶及同業的表現一致，但低於我們的預期。

And third is the continuing raw material inflation we are experiencing. Given the lag time between oil price changes and changes to the cost of goods sold, ASI has experienced on a year-to-date basis over $12 million of raw material inflation, $5 million of which was in Q2.

第三項是我們持續面臨的原物料通膨。由於油價變動與銷貨成本變動之間存在時間落差，ASI 按年初至今計算已承受超過 1,200 萬美元的原物料通膨，其中 500 萬美元發生在第二季。

In this context, the team did some great work in areas that we could control. From a revenue perspective, the team made solid gains in the important areas to offset weak demand in the end markets I just referenced.

在此背景下，團隊在我們可控的領域做了非常出色的工作。就營收而言，團隊在關鍵領域取得了扎實進展，以抵銷我剛才提到的終端市場需求疲弱。

Please note that as I speak to our sales in my following comments, I'm referring to sales on a constant currency basis and excluding the impact of the Colgate oral care reformulation. With that said, I would like to highlight that for the quarter on a year-over-year basis, the personal care team increased revenue by approximately 5% based upon solid HEC gains throughout the entire portfolio. The pharma team grew sales by 2% versus a very difficult year-over-year comp. As you will recall in Q2 of our last fiscal year, the pharma business sales grew by 17% as we brought new cellulosics capacity online. To grow year-over-year in this context was a strong achievement by the team. But the coatings team drove share gains in Latin America and the rest of Asia to offset demand weakness in the U.S. and Europe. And finally, the remainder of the ASI team drove solid gains in nutrition, energy and construction. Also of note from a regional perspective, the team achieved mid-to-high single-digit sales growth in all regions outside of North America, with China leading the way by achieving double-digit year-over-year growth.

請注意，接下來我談到的銷售表現，係以固定匯率（constant currency）基礎計算，並排除高露潔口腔護理配方調整（Colgate oral care reformulation）的影響。在此前提下，我想強調，本季與去年同期相比，個人護理團隊在整體產品組合中受惠於 HEC 的穩健成長，使營收約增加 5%。製藥團隊在去年同期比較基期非常艱難的情況下，銷售仍成長 2%。各位應記得，在上一會計年度第二季，製藥業務因我們新增纖維素產能上線，銷售成長達 17%。在此背景下仍能實現年增，對團隊而言是很強的成果。此外，塗料團隊在拉丁美洲與亞洲其他地區推動市占提升，以抵銷美國與歐洲需求疲弱。最後，ASI 其餘團隊在營養、能源與建築領域也帶動了穩健成長。從區域角度來看，除北美以外的所有地區，團隊均達成中至高個位數的銷售成長，其中以中國表現最為突出，年增達雙位數。

Putting this all together, overall volume and mix was negative in the quarter. We had gains in less profitable end markets and that did not fully offset weaker-than-expected growth in the coatings, adhesives and performance specialty end markets. Also note that given the certainty in these important markets, we also lowered finished goods inventory, which had a negative impact on our year-over-year absorption.

綜合以上因素，本季整體銷量與產品組合（volume and mix）為負向。我們在獲利較低的終端市場有所成長，但仍未能完全抵銷塗料、黏著劑與性能特用化學品終端市場低於預期的成長。另請注意，鑑於這些重要市場的能見度，我們也降低了成品庫存，對我們與去年同期相比的吸收率（absorption）造成負面影響。

Now to offset these challenges, the team once again drove price increases above raw material inflation, kept total manufacturing costs below prior year and substantially reduced SG&A. Importantly, relating to our $120 million cost-reduction program, we hit our Q2 target and are now on a run-rate basis over $70 million. These reductions contributed substantially to the $18 million SG&A reduction versus prior year in the quarter.

為了抵銷這些挑戰，團隊再次推動價格調升，幅度高於原物料通膨；同時將總製造成本控制在低於去年水準，並大幅降低 SG&A（銷售、一般及行政費用）。更重要的是，就我們 1.2 億美元的成本削減計畫而言，我們達成了第二季目標，目前按年化執行率（run-rate）已超過 7,000 萬美元。這些削減措施對本季 SG&A 較去年同期減少 1,800 萬美元做出了重大貢獻。

When you consider that roughly $20 million of overheard will transfer with the sale of the Composites and Marl businesses, we are on a run rate basis over 70% of the way through implementation of our $120 million cost reduction program.

考量約 2,000 萬美元的間接費用（overhead）將隨 Composites 與 Marl 業務出售而移轉，我們按年化執行率計算，已完成 1.2 億美元成本削減計畫實施進度的 70% 以上。

So adding this all up, to be clear, I am not happy that we came in below our expectations for the quarter. That said, I do feel good that the team drove incremental revenue gains to keep our assets better utilized, albeit with a lower-profit mix, that the team priced over inflation and significantly lowered SG&A. By focusing on what we control in a very difficult context, we enabled ASI to weather the storm far better than we would have just 2 or 3 years ago prior to establishing our current strategy.

因此，總結來說，坦白講，我對本季表現低於預期並不滿意。不過，我也確實感到欣慰的是：團隊推動了額外的營收成長，使我們的資產得以更充分利用，儘管產品組合的獲利較低；團隊的定價高於通膨，並顯著降低了 SG&A。在非常艱難的環境下專注於我們可控的事項，使 ASI 能夠比 2 到 3 年前、在建立現行策略之前，更有效地度過風暴。

Looking forward, we've adjusted our outlook to reflect our Q2 results along with expectations that the dollar will remain strong and demand weakness will last at least through the current quarter in the markets I have previously referenced. I want to emphasize the team is working multiple cost and sales actions to achieve the best results possible in this context.

展望未來，我們已調整展望，以反映第二季結果，同時也納入美元將維持強勢、以及我先前提到之市場的需求疲弱至少將延續至本季的預期。我想強調，團隊正同步推動多項成本與銷售行動，以在此情境下取得最佳可能成果。

Switching gears, given our confidence in our business strategy, we believe our stock is a solid investment, and as such, we announced yesterday our intention to commence a $200 million share repurchase program to begin in early May. To be clear, as we take this action, we remain committed to achieving our previously communicated leverage target of approximately 2x gross debt to adjusted EBITDA. Taking into account our cash on hand, strong upcoming cash generation and our confidence in the impending sale of the Composites and Marl businesses, we expect to finish fiscal year 2019 close to our targeted debt level.

話題轉換一下，鑑於我們對自身業務策略的信心，我們認為公司股票是一項穩健的投資，因此我們昨日宣布，擬於5月初啟動一項2億美元的庫藏股回購計畫。需要明確的是，在採取此行動的同時，我們仍致力於達成先前已溝通的槓桿目標，即總負債對調整後EBITDA約為2倍。綜合考量我們手頭現金、即將到來的強勁現金創造能力，以及我們對複合材料（Composites）與Marl業務即將出售的信心，我們預期在2019會計年度結束時，負債水準將接近我們的目標。

Before I turn the call over to Kevin, I'd like to reflect on some important and recent changes made to the Ashland Board. Earlier this calendar year, we welcomed Craig Rogerson to our Board. In addition, consistent with the path forward that we outlined in January, just Monday, we announced additional changes. As anticipated, Michael Ward will retire from the Ashland Board at our May meeting, and I would like to thank Michael for his 18 years of outstanding service. To fill his seat, in consultation with Neuberger Berman and other shareholders, we have elected Guillermo Novo to join the Ashland Board, and we're excited to have Guillermo join given his extensive leadership experience in the industry.

在我把電話交給Kevin之前，我想回顧一下Ashland董事會近期做出的一些重要變動。在今年稍早，我們歡迎Craig Rogerson加入董事會。此外，依循我們在1月所概述的前進方向，就在本週一，我們宣布了進一步的變動。如先前所預期，Michael Ward將於我們5月的會議上自Ashland董事會退休，我也要感謝Michael 18年來傑出的服務。為了遞補其席位，在與Neuberger Berman及其他股東諮詢後，我們選任Guillermo Novo加入Ashland董事會；鑑於他在產業中豐富的領導經驗，我們很高興他能加入。

I'll now turn the call over to Kevin.

我現在把電話交給Kevin。

Thank you, Bill, and good morning, everyone. First, let's start with Ashland's results in the second quarter. Sales in the quarter were $667 million, down 1% from the year-ago period, including negative 3 points from unfavorable currency. Adjusted EBITDA in the quarter was $142 million, up 3% year-over-year and including a negative $6 million foreign currency impact. The U.S. dollar was significantly stronger versus the prior year. The negative currency impact was led by the euro, which was $0.10 lower than the prior period, and there was also impact from currencies in emerging regions.

謝謝你，Bill，各位早安。首先，我們先從Ashland第二季的業績開始。本季銷售額為6.67億美元，較去年同期下降1%，其中不利匯率影響為負3個百分點。本季調整後EBITDA為1.42億美元，年增3%，其中包含匯率帶來的負600萬美元影響。美元相較去年同期顯著走強。負面匯率影響主要來自歐元，歐元較前期低0.10美元，此外新興市場地區的貨幣也帶來影響。

In the quarter, we reported U.S. GAAP income from continuing operations of $45 million or $0.71 per diluted share. On an adjusted basis, we reported income from continuing operations of $0.83 per diluted share compared to $0.67 in the prior period. This compares to our outlook that we provided in early February of $0.80 to $0.90 per share.

本季我們依美國GAAP認列持續營業業務淨利4,500萬美元，或稀釋後每股0.71美元。以調整後基礎計算，我們的持續營業業務每股盈餘為0.83美元，較前期的0.67美元提升。這與我們在2月初提供的每股0.80至0.90美元展望相符。

Our effective tax rate in the quarter was 6%, well below our expectation of 15% due largely to several favorable discrete tax items. You'll recall that results from continuing operations include earnings from our Specialty Ingredients segment plus our BDO facility in Lima, Ohio since Composites and Marl are now being reported as discontinued operations.

本季有效稅率為6%，遠低於我們原先預期的15%，主要是因為數項有利的一次性（離散）稅務項目。各位會記得，持續營業業務的結果包含我們Specialty Ingredients事業部的獲利，以及位於俄亥俄州利馬（Lima）的BDO工廠，因為複合材料（Composites）與Marl目前已列為停業單位。

Free cash flow during the quarter was negative $22 million compared to negative $3 million in the prior year. These amounts include $15 million in restructuring costs in the second quarter of fiscal '19 and $6 million of restructuring in the year ago period. As you will recall, we generate the majority of our free cash flow in the second half of the fiscal year. We currently expect free cash flow in the range of $165 million to $175 million this year, inclusive of an estimated $40 million of separation and restructuring-related costs.

本季自由現金流為負2,200萬美元，去年同期為負300萬美元。上述金額包含2019會計年度第二季的1,500萬美元重整成本，以及去年同期的600萬美元重整成本。如各位所知，我們大部分的自由現金流會在會計年度下半年產生。我們目前預期今年自由現金流約為1.65億至1.75億美元，其中包含估計4,000萬美元的分拆與重整相關成本。

Now for an update on the divestiture of Composites and the Marl BDO facility. As we announced in November, we signed a definitive agreement with INEOS Enterprises to sell the business for $1.1 billion. We continue working closely with INEOS to close the transaction and preparations for the divestiture remain on track. We continue to await regulatory approvals. Based on where we are right now, we expect to close the transaction by late summer. We continue to expect to use the net proceeds, roughly $1 billion, for debt reduction following the close of the transaction in support of our commitment to reduce our leverage to about 2.5 turns.

接著更新複合材料（Composites）與Marl BDO工廠的出售進度。如我們在11月宣布，我們已與INEOS Enterprises簽署具約束力的最終協議，以11億美元出售該業務。我們持續與INEOS密切合作以完成交易，相關出售準備工作仍按計畫進行。我們仍在等待監管核准。就目前進度而言，我們預期在夏末完成交易。我們仍預期在交易完成後，將約10億美元的淨收益用於償還債務，以支持我們將槓桿降至約2.5倍的承諾。

Turning to Specialty Ingredients, as you may have heard, a large ethylene oxide supplier has been down and declared force majeure. Just to provide some perspective, this impacts only one of our cellulosics facilities. This plant has been down for about a week, and we expect it to be down for several more. Our current estimate of the impact during the quarter is between $1 million and $3 million.

談到Specialty Ingredients，如各位可能已聽說，一家大型環氧乙烷供應商停產並宣布不可抗力。補充說明一下，這只影響我們其中一座纖維素（cellulosics）工廠。該工廠已停產約一週，且我們預期還會再停數週。我們目前估計本季影響介於100萬至300萬美元。

As Bill mentioned, we have revised our financial outlook for fiscal '19. We will continue to update these ranges during the second half of this fiscal year.

如Bill所提到，我們已修訂2019會計年度的財務展望。在本會計年度下半年期間，我們將持續更新這些區間。

During the March quarter, we saw pressure on earnings from weakened demand in several key end markets as well as continued U.S. dollar strengthening versus the euro and several emerging market currencies. While we are taking actions internally to offset these items, we believe they will persist through at least the current quarter and potentially into our Q4. Our new forecast presumes the current environment continues through the end of the fiscal year. If we see an improvement in the second half, we could potentially hit the high end of our revised EBITDA range. Otherwise, we believe the middle of the range is an appropriate expectation for the business. But while we are certainly not satisfied with this level of performance, as Bill indicated, it would represent approximately 4% growth over prior year for Specialty Ingredients and around 7% adjusted for currency.

在3月季度期間，我們看到數個關鍵終端市場需求轉弱，對獲利造成壓力，同時美元相對歐元及多種新興市場貨幣持續走強。雖然我們正採取內部措施以抵銷這些因素，但我們認為這些情況至少會持續到本季，並可能延續至第四季。我們的新預測假設目前環境將持續至本會計年度結束。若下半年出現改善，我們有機會達到修訂後EBITDA區間的高端。否則，我們認為區間中值是對業務較為適當的預期。不過，儘管我們對這樣的表現當然不滿意，如Bill所指出，這仍將代表Specialty Ingredients相較去年約成長4%，若排除匯率影響則約成長7%。

Last night, we also announced our intention to commence a $200 million share repurchase program under our existing $1 billion share repurchase authorization. We believe Ashland shares remain significantly undervalued especially based on the actions we have taken to improve the portfolio and our Specialty Ingredients operations. We intend to use cash on hand plus free cash flow generated by the business to fund this repurchase. I think it's important to re-emphasize that this in no way impacts our commitment toward reducing leverage to about 2.5 turns following the closing of the Composites Marl divestiture.

昨晚，我們也宣布擬在既有的10億美元股票回購授權額度下，啟動2億美元的股票回購計畫。我們認為Ashland股價仍被顯著低估，尤其是基於我們為改善投資組合以及Specialty Ingredients營運所採取的行動。我們計畫以手頭現金加上公司營運所產生的自由現金流來支應此次回購。我認為重要的是再次強調，這完全不會影響我們在複合材料與Marl出售交易完成後，將槓桿降至約2.5倍的承諾。

Now I'll turn the call back over to the operator, and we'll take your questions. Thank you.

現在我把電話交回給接線員，我們將開始回答各位的提問。謝謝。

(Operator Instructions) Your first question comes from the line of Christopher Parkinson from Crédit Suisse.

(接線員指示) 第一個問題來自Crédit Suisse的Christopher Parkinson。

So on the personal -- on the personal care side, can you comment on the materiality of the skin care's growth during the quarter and even more importantly, in the next few fiscal years? Obviously, your customers have been latching on to this, but just how integral are you to their various processes given the growth that they're showing? So I'm just trying to get a sense of personal care growth and the profile now versus well into the future.

關於個人——關於個人護理這一塊，您能否評論一下本季護膚品成長的重大性（影響程度），以及更重要的是，未來幾個會計年度的情況？顯然你們的客戶正在積極採用這些產品，但就他們所展現的成長而言，你們在其各項製程中到底有多關鍵、扮演多核心的角色？我只是想了解一下個人護理的成長，以及目前的輪廓相較於更長期未來的樣貌。

Yes. Skin care is a very important part of our personal care business and it's actually an area where we've had significant growth with our biofunctionals business, really finding sustainable solutions to help enable our customers. So we've seen growth over the last year. We expect to see more growth as we go forward. This all happened, I was in China, meeting with one of our major customers, Jala, and they are growing rapidly, and we're a major supplier to them. So we are looking to really continue to focus on sustainable solutions. We believe that's going to help us to grow that portion of the business.

是的。護膚是我們個人護理業務中非常重要的一部分，而且實際上也是我們生物功能性（biofunctionals）業務顯著成長的領域，真正找到可持續的解決方案來協助賦能我們的客戶。因此，我們在過去一年看到了成長。我們預期未來還會看到更多成長。這一切發生時，我人在中國，與我們的一位主要客戶伽藍（Jala）會面；他們成長很快，而我們是他們的重要供應商。因此，我們希望持續聚焦於可持續的解決方案。我們相信這將有助於我們擴大這部分業務的成長。

Got it. And just turning quickly to pharma. You had pretty decent result on, I'd say, fairly healthy comp. I know you're still poising to grow in the mid-single digit growth range on an annualized basis. But can you just give us a little more color or comment on any upside optionality you see there? Just I know you're obviously no longer capacity constrained. But just given the industry's healthy volume growth especially in Asia, are there any other actions you can take to kind of further drive momentum here?

了解。那再快速轉到製藥。在我看來，你們在相對健康的比較基期下仍交出相當不錯的結果。我知道你們仍以年化中個位數成長為目標。但你能否再多補充一些細節或評論一下你們在那裡看到的任何上行選擇性（upside optionality）？我知道你們顯然已不再受產能限制。但考量到產業（尤其在亞洲）健康的量增，有沒有其他行動可以採取，以進一步推動這裡的動能？

Sure. Certainly, I would say that the additional capacity we've brought on in the cellulosics area has enabled us not only to have continued growth, but we've seen increased customer interest in that product line area with the understanding that we now can more effectively supply them, and I would say that's on a global basis. So we put out a few press releases over the last 3, 4 months. We continue to drive actually innovation by providing new variants of the product. We are -- and have established, local development capabilities. So in places like India and China, we can work with the local often generic manufacturers. Once again, I had the opportunity to meet with one while I was in China for dinner a couple of weeks ago, and they're very bullish on the market and where that takes us. And I really do think that our products do enable solutions for our customers, whether it be the disintegration properties or the size of the tablets, other aspects. And by blending together some of our existing technologies, changing the particle size, distribution, working with customers on solutions, I think that's what's going to continue to drive our growth in pharma.

當然。我會說，我們在纖維素（cellulosics）領域新增的產能，不僅讓我們能持續成長，也讓客戶對該產品線的興趣提高，因為他們理解我們現在能更有效地供應；而且我會說這是全球性的。因此，我們在過去3到4個月發布了幾則新聞稿。我們持續透過提供新變體來推動創新。我們也正在——並且已建立——在地開發能力。因此在印度和中國等地，我們可以與當地（通常是學名藥）製造商合作。同樣地，幾週前我在中國晚餐時也有機會與其中一家會面，他們對市場以及這將把我們帶往何處非常看多。我確實認為，我們的產品能為客戶提供解決方案，無論是崩解特性、錠劑尺寸或其他面向。而透過把我們既有的一些技術進行混配、調整粒徑與分布、與客戶共同開發解決方案，我認為這些將持續驅動我們在製藥領域的成長。

And on the subject of Klucel, while it certainly isn't related to pharma, we're seeing that, that material has properties that can be used in other markets, and we're really just beginning to explore that at this time. In the past, that would've been out of the question because we needed every pound we had to supply the pharma customers, but it has applications in multiple markets. There is marine paint that's being introduced with Klucel as part of its formula. So anyway, we feel very good about the team that we have, the footprint that we have, the products that we have, and that's what gives us confidence that we can continue to grow our pharma business.

另外談到Klucel，雖然它確實與製藥無關，但我們看到該材料具備可用於其他市場的特性，而我們目前才剛開始探索。過去這是不可能的，因為我們需要把每一磅產量都用來供應製藥客戶，但它其實可應用於多個市場。目前有一款海事塗料（marine paint）正在導入，配方中包含Klucel。總之，我們對我們的團隊、我們的布局（footprint）、以及我們的產品都非常有信心，這也是讓我們相信能持續成長製藥業務的原因。

And Chris, I would also say that within the nutraceuticals space, we're also seeing more uptake from our excipient packages relative to that as well. So as we continue to see growth in nutraceuticals, both in the U.S. and globally, we should also see some improvement from an overall excipient growth perspective through that particular end market as well.

Chris，我也想補充，在營養保健品（nutraceuticals）領域，我們也看到相較之下對我們賦形劑（excipient）套裝方案的採用度正在提升。因此，隨著我們持續看到營養保健品在美國及全球的成長，從整體賦形劑成長的角度來看，透過該終端市場我們也應該會看到一些改善。

Your next question comes from the line of John McNulty with BMO Capital Markets.

下一個問題來自BMO Capital Markets的John McNulty。

So the fiscal 2Q obviously was maybe a little bit on the light side, but the guide seems a little bit worse than, I guess, what we would have expected. And so, I guess especially when you consider some of the cost cuts rolling through, so what are the end markets or what are the business lines that you're most concerned with at this point to guide kind of us conservatively as you have been? What sequentially gets worse and how should we think about that?

所以財年第二季（2Q）顯然可能有點偏弱，但你們的指引看起來比我們原先預期的還要差一些。因此我想，尤其考量到一些成本削減措施正在逐步反映出來，目前你們最擔心的是哪些終端市場或哪些業務線，才會像現在這樣保守地給指引？接下來哪些會按季變得更差？我們應該如何看待？

Yes. I think, well, first of all, when you look at the change in the guidance, it represents Q2 results actually and a continuation of what we saw in Q2 adhesives and coatings. It's possible that we'll see an uptick in demand and that would be great. As Kevin said, that would help to push us up in the range. Clearly, if there was any weakening of the dollar, that would help as well. But we didn't want to just assume that there would be a demand recovery when it's affected us in Q2, and we're not seeing yet a significant recovery in those areas. I mean -- and as I say that, I mean, I would like to point out a couple of things because I think it's important. And again, I'm going to emphasize, I'm not happy with the results and the changing of the guidance so I don't want to give out that impression. I mean, we're still talking about being flat to up in those markets, and I think that's important. And we're also in spite of these changes, whether it be with currency and raw material, some of the market weakness, I mean, our guidance has us growing in terms of sales, earnings and margin. So yes, we have to and we need to and we will do better, but we basically extrapolated what we saw in Q2 and assumed that it would continue as we go forward. And I think as you have followed our coatings customers, especially the ones in North America, I think you've heard that there is some caution in terms of what they are expecting for the spring coatings season. That's why we're putting a lot of our energy into places like the rest of Asia, India, so forth, to try to drive additional volume to help us to make sure that, okay, we balanced out what otherwise might be a contraction in that area.

是的。我想，首先，當你看指引的變動時，它其實反映了第二季的結果，以及我們在第二季於黏著劑與塗料所看到情況的延續。我們有可能會看到需求回升，那會很棒。如Kevin所說，那將有助於把我們推向區間的上緣。很明顯地，如果美元有任何走弱，也會有所幫助。但我們不想僅僅假設需求會復甦，因為它在第二季已影響到我們，而我們目前在那些領域還沒有看到顯著復甦。我的意思是——我在這麼說的同時，也想指出幾點，因為我認為這很重要。再次強調，我對結果以及指引的下修並不滿意，所以我不希望給人相反的印象。我們談的仍是那些市場持平到小幅成長，我認為這點很重要。而且即便有這些變化，不論是匯率與原物料，或部分市場疲弱，我們的指引仍顯示在銷售、獲利與毛利率方面成長。所以是的，我們必須、也需要、而且也會做得更好；但我們基本上是把第二季看到的情況外推，並假設未來會持續。而且我想你若一直關注我們的塗料客戶，尤其是北美的客戶，你應該也聽到他們對春季塗料旺季的預期帶有一些謹慎。這也是為什麼我們把大量精力投入到亞洲其他地區、印度等地，試圖帶動更多出貨量，確保我們能平衡掉在該區域可能出現的收縮。

Got it. And then just, I guess, maybe a little bit of clarity on the cost cutting opportunities. When you think about the run rate that you're at, like how should we be thinking about the sequential benefit from 2Q to 3Q as far as the cost cuts rolling in?

了解。那再請你們釐清一下成本削減的機會。當你們思考目前的運行水準（run rate）時，就成本削減逐步落地而言，從第二季到第三季按季的效益，我們應該如何看待？

Yes, John, we should continue to see the cost structure improve within this quarter and the next. We'll still have a bit to go by that time we get to the end of the fiscal year, so that in our Q1 of our fiscal '20 or the December quarter, we'll see the final amounts roll through. But we're very much on track to a little bit ahead of schedule on that. I will say that as we talk about run rates, it's pretty typical, again, not 100% of the time but pretty typical for a lot of these amounts that we get to come at the end of the month or at the end of the quarter. And so the flow-through tends to be more impactful in the following quarter. So if we were at $50 million a quarter ago, we're at $70 million now. You'll really start to see the full impact of that extra $20 million start to flow through in the next quarter. And so that's kind of the way to think about it from a staging perspective in terms of the overall impact on SG&A.

是的，John，我們在本季以及下一季應該會持續看到成本結構改善。到財年結束時我們仍會有一些尚未完全到位，因此在我們2020財年第一季（也就是12月季度）會看到最後的金額反映出來。但我們在這方面非常按計畫進行，甚至略微超前進度。我會說，談到運行水準時，通常——當然不是100%都如此——很多這些金額會在月底或季底才入帳。因此，費用節省的傳導（flow-through）往往在下一季更為顯著。所以如果一季前我們是5,000萬美元，現在是7,000萬美元，你會在下一季真正開始看到額外2,000萬美元的完整影響逐步反映出來。因此，從分階段（staging）的角度來看，這就是思考其對整體SG&A影響的方式。

Your next question comes from the line of David Begleiter with Deutsche Bank.

您的下一個問題來自德意志銀行（Deutsche Bank）的 David Begleiter。

Bill and Kevin, what was the impact of the reduced plant absorption in the quarter?

Bill 和 Kevin，本季工廠吸收率下降對業績的影響是什麼？

Yes. So it was -- I mean, I'm going to be directional here. It was in the kind of like the $5 million to $7 million range. So I mean, it was significant enough that we're mentioning it. We're not trying to come up with a laundry list here, but it was significant enough. We thought it was appropriate given some of the things we've seen in the market. And that also potentially gives us the opportunity if we see market recovery to drive our operations to recover that, but that's roughly, yes.

是的。所以——我的意思是，我會用方向性的方式來說。大概在 500 萬到 700 萬美元的區間。所以我的意思是，影響大到我們會特別提到它。我們不是要列出一長串原因，但它確實重要到值得一提。考量到我們在市場上看到的一些情況，我們認為提及它是合適的。而且如果我們看到市場復甦，這也可能給我們機會推動營運把這部分追回來，但大致上就是這樣，是的。

Sequentially, we took inventories down about $20 million. So -- and directionally, Bill's number of around $5 million to $7 million for absorption is correct. Yes, mix -- really the other piece of the earnings compression was related to overall mix as we've talked about.

以季比來看，我們把庫存降低了大約 2,000 萬美元。所以——而且方向性來說，Bill 提到吸收影響約 500 萬到 700 萬美元是正確的。是的，產品組合——其實獲利被壓縮的另一個部分，正如我們談過的，是與整體組合有關。

That's very helpful. And Kevin, just what was actually pricing in ASI in the quarter?

這非常有幫助。Kevin，那本季 ASI 的實際定價表現如何？

We were actually a couple of million dollars ahead of raws in the quarter on an overall basis, which is very encouraging. As you know, we've -- it's taken a lot of time for us to climb that curve as we -- particularly over the last couple of years have seen a fair bit of raw material cost inflation. And I'd say, for the last several quarters, the team has done an excellent job of not only catching up but really trying to recover some of that margin compression that we've seen in the past. So we're very encouraged by that.

就整體而言，本季我們實際上比原物料成本（raws）領先了約幾百萬美元，這非常令人鼓舞。如您所知，我們——爬升那條曲線花了很多時間，因為——特別是在過去幾年，我們看到相當程度的原物料成本通膨。我會說，在過去幾個季度，團隊做得非常出色，不僅追上了，還真正試圖收復我們過去看到的部分毛利壓縮。所以我們對此非常振奮。

Your next question comes from the line of Mike Sison with KeyBanc.

您的下一個問題來自 KeyBanc 的 Mike Sison。

In terms of the -- you obviously need a better second half in EBITDA growth. Can you maybe walk us through by product, meaning, is it mostly in cellulosics or PVP or Pharmachem that really needs to recover in the second half to hit your outlook?

就——你們顯然需要下半年 EBITDA 成長更好。你能否按產品帶我們梳理一下？也就是說，主要是纖維素（cellulosics）或 PVP 或 Pharmachem 在下半年需要復甦，才能達到你們的展望？

Yes. Well, I mean, all the markets matter. What I referenced before was that we've adjusted our outlook because of the Q2 results, but really with the perspective and the reflection that the adhesives, coatings and performance specialties, would remain soft at least for a good part of the year. And I think that's what a number of people are estimating is that by the second half of the year, you'll begin to see these markets recover. But those are the areas. I mean, we continue to grow the Pharmachem business. We have a strategy, which I know you're aware of, which is that while we'd love to sell as much products as we can into the pharma, personal care, coatings, adhesives markets and so forth, when those businesses are a little bit slower, we try to leverage our available capacity in cellulosics, for example, to sell into the construction and energy marketplace, which allows us to keep our facilities running efficiently. So it's not so much of a watch out on those segments. It's really -- not segments, but end markets. It's really in the areas that we've already identified.

是的。嗯，我的意思是，所有市場都很重要。我先前提到的是，我們因為第二季的結果調整了展望，但主要是基於這樣的觀點與反思：黏著劑、塗料與高性能特用化學品（performance specialties）至少在今年相當一段時間內仍會偏弱。而我認為不少人的估計是，到今年下半年，你會開始看到這些市場復甦。但重點就在這些領域。我的意思是，我們持續成長 Pharmachem 業務。我們有一個策略，我知道你也了解：雖然我們希望能把盡可能多的產品賣到製藥、個人護理、塗料、黏著劑等市場，但當這些業務稍微放緩時，我們會嘗試利用例如纖維素等的可用產能，轉而銷售到建築與能源市場，讓我們的工廠能維持高效率運轉。所以這並不是要特別提醒那些區塊有什麼問題。其實——不是細分市場，而是終端市場。真正的重點是在我們已經指出的那些領域。

And Mike, if you look at our second half and the guidance that we're providing around that, what we're presuming is those end markets like coatings, adhesives and performance specialties, they'll return to normalized growth rates but probably somewhere around half that for the second half to the extent that, that those end markets end up doing better. There is upside, as I indicated in my remarks, to potentially get to the high end of the range, but it would require more of a demand recovery than we're currently forecasting, which is why we're guiding more towards the middle at this stage of the game.

Mike，如果你看我們下半年以及我們就此提供的指引，我們的假設是像塗料、黏著劑與高性能特用化學品這些終端市場，會回到正常化的成長率，但下半年大概只有正常化的一半左右；如果那些終端市場表現更好，就會有上行空間，正如我在發言中提到的，有可能達到區間上緣，但那需要比我們目前預測更強的需求復甦，這也是為什麼在這個階段我們的指引更偏向區間中位數。

Right. Okay. And then when you think about 2020, which I know it may be a little early to give specific guidance, but we're not too far away for you given your fiscal year. Can you maybe walk us through what will drive EBITDA growth next year? You've got some cost savings. What the leverage would be if organic growth comes back to a more normalized state? And maybe any other areas that help you drive growth in 2020?

了解。好。那再談到 2020 年，我知道現在給出具體指引可能還有點早，但以你們的會計年度來看，其實也不算太遠。你能否帶我們梳理一下，明年 EBITDA 成長會由哪些因素驅動？你們有一些成本節省。如果有機成長回到較正常的狀態，營運槓桿會是什麼樣子？以及是否還有其他領域能幫助你們在 2020 年推動成長？

Yes. So you did a good job as you outlined the question there really with the answer. And I mean, when you look at a couple of factors, we're seeing that raw material prices -- inflation is abating. We thought they might go down a little further given that oil drop, but it's kind of come back up but at a similar level. The currency really becomes from a year-over-year comparison, unless the dollar changes again, a non-issue as you get into the first quarter of next year. We've had this Colgate dynamic, which will play out for the most part by the end of the fiscal year. There may be just a little bit of a hang-on over on that, but essentially, we will have lapped that. And we put the price in place. So when you put that together, I mean, we're seeing growth in the personal care market that's consistent with our growth rate, if you will, excluding the currency and the Colgate impact. So we would expect that that would continue. Biofunctionals, some of these very good solutions that we're providing the marketplace. Adhesives has been a consistent grower, and we would expect it to continue to grow. Coatings, we'd be growing with the coatings market. So we don't see a fundamental disruption or change in the market. Again, I'm kind of leaving the Colgate reformulation aside on that one. And so we think we'll be lapping those, we'll have significant SG&A cost-reduction carryover from the programs that we've put in place based upon the timing. We've been able to price above raw material inflation as we've experienced today. So we remain bullish on our strategy and bullish on where the business goes. I'm not here to deliver excuses because like I said, I'm not pleased. It's our job to work different levers to get the right results. We've really had a trifecta, as it's come in, in terms of the things that have challenged us. And the one thing I do feel good about in that context is we're still driving improvements in the business based upon other aspects of our strategy, and we're going to continue to do those, whether that's the operations focus, the SG&A, the pricing. So that's what gives us confidence that we can return to what we would consider a more normalized growth rate of sales and earnings as we get into fiscal year 2020.

是的。所以你剛才把問題的架構梳理得很好，其實也差不多就是答案。我的意思是，當你看幾個因素，我們看到原物料價格——通膨正在趨緩。我們原本以為隨著油價下跌可能還會再降一些，但它又回升了，不過大致維持在相近水準。匯率方面，從年對年的比較來看，除非美元再次變動，到了明年第一季基本上就不再是問題。我們有這個 Colgate 的動態因素，基本上會在本會計年度結束前大致告一段落。可能還會有一點點尾巴，但本質上，我們就會完成對比基期（lapped）。而且我們也已經把價格調整到位。所以把這些放在一起看，我們看到個人護理市場的成長與我們的成長率一致——如果你把匯率與 Colgate 的影響排除在外的話。因此我們預期這樣的趨勢會延續。Biofunctionals，以及我們提供給市場的一些非常好的解決方案。黏著劑一直是穩定的成長動能，我們預期會持續成長。塗料方面，我們會跟著塗料市場一起成長。所以我們不認為市場會出現根本性的破壞或改變。同樣地，我先把 Colgate 的配方重整（reformulation）影響暫時放一邊。因此我們認為這些因素會過去；同時，基於時點安排，我們先前推動的方案將帶來顯著的 SG&A 成本削減延續效益（carryover）。就像我們今天所經歷的，我們也能做到定價高於原物料通膨。所以我們仍然看好我們的策略，也看好業務的走向。我不是來找藉口的，因為如我所說，我並不滿意。我們的工作就是運用不同的槓桿來取得正確的結果。我們確實遇到了一個「三重打擊」（trifecta），就挑戰我們的因素而言。而在這樣的背景下，我覺得有把握的一點是：我們仍在根據策略的其他面向推動業務改善，而且我們會持續這麼做，不論是營運聚焦、SG&A、或定價。這就是讓我們有信心在 2020 會計年度回到我們所認為較正常化的營收與獲利成長率的原因。

Yes. I think I'll add. All things being equal basis, we'd expect the business to organically generate kind of mid-single-digit EBITDA growth on a stand-alone basis. And you layer in the impact of carryover cost-out. That's going to get you several more percentage points. So I think, again, all things being equal, it wouldn't be unreasonable to expect the ingredients business to grow 7%, 8%, 9% in 2020.

是的。我想我再補充一下。在其他條件相同的前提下，我們預期該業務在獨立運作的基礎上，能夠透過內生成長帶來約中個位數的 EBITDA 成長。再加上延續性的成本削減效益。這會再帶來幾個百分點。所以我認為，同樣在其他條件相同的情況下，預期原料業務在 2020 年成長 7%、8%、9% 並非不合理。

And if you look at it, we -- we did that last year. It was our intention to do this this year. As we mentioned, we've had some things that have weighed against that. And as we lap those things and get beyond them, there's no reason why we believe that we can't get back to what we would have anticipated at the start of this year and what we achieved last year.

而且如果你回頭看，我們——我們去年就做到了。我們今年原本也打算這麼做。如同我們提到的，我們遇到了一些不利因素拖累。當我們把這些因素消化完、並且走過之後，我們沒有理由認為無法回到今年年初所預期的水準，以及去年所達成的成果。

Your next question comes from the line of Laurence Alexander with Jefferies.

下一個問題來自 Jefferies 的 Laurence Alexander。

I guess, first, just to clarify, the inventory work-down that you've done, is that over or is that also in Q3?

我想先確認一下，你們已經做的庫存去化（inventory work-down），是已經結束了，還是第三季也會持續？

I would say, for the most part, it's over. I mean, our inventories kind of fluctuate a little bit quarter-to-quarter. Kevin referenced with this EO [ethylene oxide] (added by the company after the call) outage that there will be some adjustments to our cellulosics inventory. And in parts of our market, we're seeing heavy demand, so that's pulling on it. I think the challenge will be to actually drive increased production to ensure that we have the right inventory levels in the right locations. And so while we'd always like to see lower inventory levels, that's not really a core part of our strategy for the rest of the year. We're really focused on getting more product out to help support sales.

我會說大致上已經結束了。我的意思是，我們的庫存會在每季之間有些小幅波動。Kevin 提到這次 EO [ethylene oxide，環氧乙烷]（由公司在電話會議後補充）停工事件，會對我們的纖維素庫存做一些調整。而在我們部分市場，我們看到需求很強勁，所以也在拉動庫存。我認為挑戰其實在於推動提高產量，以確保我們在正確的地點有正確的庫存水位。因此，雖然我們一向希望庫存水位更低，但這並不是我們今年剩餘時間策略的核心。我們真正聚焦的是把更多產品出貨，以協助支撐銷售。

And one of the plans is pushing as hard as possible doing it.

而其中一項計畫就是盡可能用力推進、全力去做。

And I guess, can you tie that last comment into how you're thinking about capacity utilization or asset utilization and mix and where you think margins from a mix effect standpoint should be trending over, say, the next 2 to 3 years as we're looking out into early next decade?

另外，我想請你把剛才那段話連結到你們對產能利用率或資產利用率、產品組合（mix）的看法；以及從組合效應的角度，你們認為未來 2 到 3 年、展望到下個十年初期，毛利率應該會如何走勢？

Sure. So that's a potent question, and it's hard to give a simple or concise response to that. We've done a very good job of filling up our cellulosic assets. And when you get in that situation, you're really focused on 2 primary points. One of them is to debottleneck and expand the output, which we've done by the way. And as you recall, we added about 3,000 tons last year in our Nanjing facility with the change to our dryer system. So that and then secondly, upgrading the mix. Selling more differentiated products, selling more Pharma, which may be over nutrition products or over certain construction products. That would be essentially in the cellulosics area. In the adhesives and biofunctionals area, the capacity, we can be challenged at times, but it's easier to add more incrementally the capacity there. The Lima facility is full, so it really comes down to the cellulosics. I think we have opportunities to address and drive more volume through that part of our system, which is something we're going to focused on technically, commercially and because we do have some extra capacity in that area that we'd like to leverage.

當然。這是一個很有力的問題，也很難用簡單或精煉的方式回答。我們在把纖維素資產的產能填滿方面做得非常好。當你處在那種狀況時，你會主要聚焦兩個重點。第一個是去瓶頸並擴大產出，而我們也確實做了。如你所記得的，我們去年在南京廠透過更換乾燥系統，新增了約 3,000 噸產能。所以這是一點；第二點則是提升產品組合。銷售更多差異化產品、銷售更多製藥（Pharma）產品——相較於營養品或某些建築用產品。這基本上是在纖維素領域。在黏著劑與生物功能性（biofunctionals）領域，產能有時也會吃緊，但那邊比較容易以增量方式逐步擴充產能。Lima 廠已經滿載，所以關鍵其實回到纖維素。我認為我們有機會在系統的那一段去處理並推動更多量，這也是我們將在技術面與商業面聚焦的方向，因為我們在那個領域確實還有一些額外產能希望加以運用。

And then just to understand the mix effects this quarter and then thinking about the dynamics such as the lumpiness going forward, if we're to take the basket of lower-margin businesses that you call out, is the differential in margin around 500 basis points or is it north of 1,000?

另外，為了理解本季的組合效應，以及往後像是波動性（lumpiness）的動態；如果我們把你們點名的那些低毛利業務當作一籃子來看，它們的毛利差距大約是 500 個基點，還是超過 1,000 個基點？

It would be more than 500 basis points between, say, an energy product and a pharma, much, much more than that. And we'll be communicating more in the near future around that so you'll have a better perspective, but there really is a significant difference between those top-end products versus the products that fill in the capacity. So that's why upgrading the mix is really an important part of what we do. In the context of what we saw this quarter, we did the right thing because you don't want to strand those manufacturing costs. It is profitable to us, but it certainly is at a lower profitability, which is why we say in spite of, let's say, FX-constant revenue going up that we saw an unfavorable volume mix impact.

如果拿能源產品和製藥產品相比，差距會超過 500 個基點，遠遠超過。我們近期也會就此做更多溝通，讓你有更清楚的視角；但高端產品與用來填補產能的產品之間，確實存在顯著差異。所以提升產品組合確實是我們工作中非常重要的一部分。就本季所看到的情況而言，我們做了正確的事，因為你不希望讓那些製造成本被閒置。對我們而言仍然是有利潤的，但獲利能力確實較低，這也是為什麼我們說，儘管在固定匯率下營收上升，但我們仍看到不利的銷量/組合影響。

Yes. So it's -- and it's also important to remember that -- and construction is probably our lowest-margin business in the portfolio, but it's also important to remember that our construction business serves a very, very important role and function in that it supports our pharma business, particularly the Benecel line that's coming out of Doel, Belgium. So the first priority there is to produce and sell as much Benecel pharma-grade cellulose as possible and then to optimize that facility with the balance of the material coming out of there going primarily to the construction end market. So there's a symbiosis involved in all of this too that we have to keep in mind as we operate these facilities.

是的。所以——同時也要記得——建築可能是我們產品組合中毛利最低的業務，但同樣重要的是，我們的建築業務扮演非常、非常重要的角色與功能：它支撐了我們的製藥業務，特別是來自比利時 Doel 廠的 Benecel 產品線。因此，那裡的第一優先是盡可能多生產並銷售 Benecel 藥用級纖維素，然後用從那裡產出的其餘材料來最佳化該廠的運作，而這些材料主要會流向建築終端市場。所以這一切之間也存在共生關係，我們在營運這些工廠時必須把這點放在心上。

Your next question comes from the line of John Roberts with UBS.

下一個問題來自 UBS 的 John Roberts。

This is Josh Spector on for John. So just a question around Pharmachem. Growth there has been kind of stable low single-digits over the past few quarters since you've acquire the business. I was just wondering in terms of longer-term expectations, is that about the level you were expecting or would you expect top line to be potentially higher over the next couple of years?

我是 Josh Spector，代替 John 提問。我想問一下 Pharmachem。自從你們收購這項業務以來，過去幾季的成長大致穩定在低個位數。我想了解就長期預期而言，這大概符合你們原先的預期水準嗎？還是你們預期未來幾年營收成長可能更高？

Yes. So I would say that the -- what you see with a couple of percent growth is really representative of the fact that we, as we stated, have changed our mix running through that business. We've gotten out of some low-margin business last year, and that's why you saw the substantial pickup in EBITDA when we last reported it at the end of our fiscal year as a percentage of sales. It went up dramatically after, although I think it was initially from 20% to roughly above 30%. So the contribution is much greater. Now that being said, our objective is to grow the business and to accelerate the growth there. There are opportunities both in North America and globally, so over time, that mix improvement will have worked its way through and kind of the carryover impact of that in terms of growth. And then the focus will be on a very profitable growth from there.

是的。我會說，你看到的幾個百分點成長，確實反映了我們如先前所述，已經改變了該業務的產品組合。我們去年退出了一些低毛利業務，這也是為什麼你在我們上一次於會計年度結束時所揭露的數據中，看到 EBITDA 佔銷售額的比例大幅提升。它在那之後大幅上升，雖然我記得一開始大約是從 20% 提升到約略高於 30%。因此貢獻度大得多。話雖如此，我們的目標是擴大該業務並加速其成長。北美與全球都有機會，因此隨著時間推進，這些組合改善會逐步反映出來，並在成長上帶來某種延續性的影響。接下來的重點將是從那裡開始推動非常高獲利性的成長。

Yes. Given -- I mean, given the opportunity to globalize that business, I mean, the vast majority of Pharmachem is North America for us. And given the opportunity to globalize that business, there's no reason that we shouldn't see mid-single-digit growth rates over time. And I would expect that to persist for a period of time as well as we go through that globalization process. It could be lumpy but in the end, that's one of the opportunities that will be acquired with that business is the opportunity to leverage our global footprint to grow it in a more global way.

是的。考量到——我是說，考量到將那項業務全球化的機會，我是說，對我們而言，Pharmachem 的絕大多數業務都在北美。而且在有機會把那項業務全球化的情況下，沒有理由我們不應該隨時間看到中個位數的成長率。我也預期在我們推進全球化流程的這段期間，這種成長會持續一段時間。它可能會有些起伏，但最終，隨著收購那項業務而取得的機會之一，就是運用我們的全球佈局，讓它以更全球化的方式成長。

Okay. Just in terms of the divestment, it seems like the time is a little bit later than you originally thought. And I think some of the updated EPS guidance reflects interest being higher assuming that you've had debt paydown later. One, I wanted to check if that's right. And then two, just in terms of how much interest could be down after that $1 billion paydown, is like $40 million a reasonable number or is there some other number you guide to?

好的。就剝離（divestment）而言，看起來時點比你們原先想的稍微晚一些。我想更新後的 EPS 指引也反映了利息較高，因為假設你們較晚才進行債務償還。第一，我想確認這樣理解是否正確。第二，就那 10 億美元償債之後利息能下降多少而言，約 4,000 萬美元是否是合理的數字，或是你們會指引其他數字？

Yes. I'd say it's probably closer to $45 million, and that kind of depends on how some of our variable rates stuff pays out and how quickly we do that versus maybe the mix in the bottom portfolio that we might retire. But $45 million is a pretty good estimate, presuming the entire $1 billion goes to debt paydown, which would be our current presumption.

是的。我會說可能更接近 4,500 萬美元，而這在某種程度上取決於我們一些浮動利率項目的實際走勢，以及我們執行的速度，還有可能要退役（retire）的底層投資組合（bottom portfolio）中的組合。但在假設整個 10 億美元都用於償還債務的前提下——這也是我們目前的假設——4,500 萬美元是相當不錯的估計。

Yes. And from a timing standpoint, I'd just say that really, as we said, we remain on track. We're just waiting for the regulatory approvals so we can complete the process.

是的。就時程而言，我只想說，確實如我們所說，我們仍然按計畫進行。我們只是等待監管核准，以便完成流程。

Right. And another thing to note is you have to look at -- you have to look both above and below the lines. We have some of our interest expenses going through discontinued operations. So as you think about your modeling, you'll need to take a peek down in the part of the balance sheet as well to understand how much is down there.

沒錯。另外一點要注意的是，你必須看——你必須同時看損益表的線上與線下項目。我們有一部分利息費用是走停業部門（discontinued operations）。所以在你做模型時，也需要往下看資產負債表的那一部分，了解那邊有多少。

Your next question comes from the line of Jeff Zekauskas of JPMorgan.

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

Were your ASI volumes down, flat or up in April?

你們 ASI 的銷量在 4 月是下滑、持平還是成長？

In April, of course, we've still got to kind of close out the month, so we'll be getting better clarity. It takes us a couple of days to kind of get that information. But I would say that directionally, what we saw was consistent with what we saw in Q2, and so that's really reflected in the forecast that we have.

4 月當然我們還需要把這個月大致結算完，所以之後會更清楚。我們通常需要幾天時間才能取得那個資訊。但我會說，就方向性而言，我們看到的情況與我們在第二季看到的一致，因此也反映在我們目前的預測之中。

And the big drivers for what we saw in Q2 were really construction and adhesives. I mean, not only was that a top line and a profitability impact, but it was a pretty sizable volume impact as well. Those are probably our 2 highest-volume businesses or end markets in the portfolio. And particularly, in North America, we saw volume pressure there.

而我們在第二季看到的主要驅動因素，確實是建築與黏著劑。我的意思是，那不僅影響營收與獲利，也對銷量造成相當顯著的影響。這兩個大概是我們投資組合中銷量最高的兩項業務或終端市場。尤其在北美，我們看到那裡有銷量壓力。

Which is what we saw in Q2 as well. So we tend to focus on the volume mix, as you know, but from a volume standpoint, we were down in Q2, which is what we saw essentially. And we haven't closed yet on May -- or April, excuse me, but that's the trend that we've seen extend.

這也就是我們在第二季看到的情況。所以如你所知，我們通常更聚焦在銷量組合（volume mix），但就銷量而言，我們在第二季是下滑的，基本上就是我們所看到的。而我們尚未完成 5 月——或是 4 月，抱歉——的結算，但我們看到的趨勢是延續的。

Okay. And your SG&A in the Specialty Ingredients in the quarter was -- your SG&A expense was $119 million. Is there any reason why that number should be larger in the third or the fourth quarter? Or should that be a number which stays the same or decreases through the remainder of the year?

好的。你們本季 Specialty Ingredients 的 SG&A——你們的 SG&A 費用是 1.19 億美元。有任何理由使得這個數字在第三季或第四季會更高嗎？或者這個數字應該在今年剩餘期間維持不變或下降？

It should probably decrease a bit through the rest of the year. FX will have an impact on that, but in terms of the cost-out flow-through, we should continue to see SG&A on an overall basis continue to decline. I mean, that's -- our current estimates would indicate that.

它在今年剩餘期間應該會小幅下降。匯率（FX）會對此有影響，但就成本削減的傳導（cost-out flow-through）而言，我們應該會繼續看到整體 SG&A 持續下降。我的意思是——我們目前的估計顯示會是這樣。

When you look at it, the FX impact had a -- was very significant, obviously, in the sales line and on the gross profit line. In the current context, we actually do get a benefit from currency when you look at it in the SG&A line.

當你去看時，匯率影響在營收端與毛利端顯然都非常顯著。在目前的情境下，當你看 SG&A 這一行時，實際上我們會從匯率中獲得一些好處。

Your next question comes from the line of Mike Harrison from Seaport Global Securities.

下一個問題來自 Seaport Global Securities 的 Mike Harrison。

Just wondering if you have been taking any incremental additional cost actions in response to the end market weakness. So I'm wondering if you're accelerating some of the existing programs or maybe initiating some new programs, or even taking more temporary action like pulling back on G&A expense or incentive comp or anything like that. Did you see any of that in Q2?

想請教你們是否因應終端市場疲弱而採取任何額外的增量成本行動。所以我想了解你們是否在加速既有的一些計畫，或可能啟動一些新計畫，甚至採取更偏短期的措施，例如縮減 G&A 費用或獎酬（incentive comp）等，或類似作法。你們在第二季有看到這些嗎？

Yes. So to that end, we certainly are taking action and we've been working on that with the team. We're, as I mentioned, about 70% through the existing cost reduction program, and we need to get through that and we need to transfer for the business. So we're looking at what we can do to accelerate the cost-outs in that area, and we've had some progress on that. We have quite a list of things that we've put together as it relates to hiring, as it relates to travel, as it relates to aspects of what we saw within our plant. We have an extensive list of things that we're working on to try to achieve the best results in this context. And yes, at this level of performance, it does negatively impact our incentive compensation. Some of that's reflected on a year-to-date basis, but that would continue through as we go through. Now we would like to have that expense go up, but that expense will only go up if we can deliver a better result for you, the shareholders. So we're aligned in that regard.

有的。就這點而言，我們確實正在採取行動，也一直與團隊一起推進。如我提到的，我們既有的成本削減計畫已完成約 70%，我們需要把它做完，並且需要把成果轉化到業務上。因此我們在評估能做些什麼來加速該領域的成本削減，而且已經有一些進展。我們整理了一長串事項，涵蓋招募、差旅，以及我們在工廠內所看到的一些面向。我們有一份很完整的清單正在推動，力求在此情境下達成最佳結果。而且是的，在這樣的績效水準下，確實會對我們的獎酬造成負面影響。其中一部分已反映在年初至今（year-to-date）的數字中，但隨著我們繼續推進，這種情況也會延續。當然我們希望那項費用能上升，但只有在我們能為你們——股東——交出更好的結果時，那項費用才會上升。所以在這方面我們的立場是一致的。

And then a couple of questions related to coatings. I guess, first of all, a lot of the coatings weakness that we're hearing about in North America appeared to be weather related, in other words, should be more temporary. Yet you guys seem to be a little bit more cautious on the outlook for North America. And wondering also if you can maybe expand on your efforts or on your -- the comment on selling more coatings into emerging markets, maybe a little more detail and how big that opportunity could be.

接著有幾個與塗料（coatings）相關的問題。我想首先，近期我們聽到北美塗料走弱，很大一部分似乎與天氣有關，換言之，應該比較偏短期。但你們對北美展望似乎更為謹慎一些。也想請你們進一步說明你們在新興市場銷售更多塗料的努力，或是你們提到的——把塗料賣到新興市場的評論，能否多給一些細節，以及那個機會可能有多大。

Yes. So I mean, the people who can speak best to the dynamics that they're seeing and the impact of weather or other factors are our customers, and so it's hard for me to specifically comment there. We have an internal expression that hope is not a strategy, so we don't want to put something out there that assumes that we'll have a sunny spring and that will trickle through to a high demand. If it does, that's awesome. That's why we have a range and that would help us to go to the upper part of the range. But for now, we think that that's a good thing to hope for but we can't count on that. Secondly, as it relates to other parts of the globe. I think there have been a number of developments and it's been a very focused effort. We focused on trying to develop grades that are most relevant for the very specific customer needs. I keep going back to this trip I had to China a few weeks back. I met with the largest plant manufacturer or coatings manufacturer in China. And there are different things that they look for there. The stone texture is more important in many instances than a smooth type coating. So the rheology differences and the products we have are different. So we're enabling the team to develop more localized formulations to meet those needs. The importance of sustainability in places like Europe is increasing, which creates opportunity for us. So it's been a focused effort to really leverage the infrastructure we have and make sure we're focusing on the local needs that the regional customers have, and that's been a big part of it. I think in China, you don't see a ton of or a groundswell of construction. That may change over time, but the team still has been working to gain share in that context, and we have, we have. We've got some really great programs that are in place. So that's what we're doing to offset it.

是的。所以我的意思是，最能說明他們所看到的動態，以及天氣或其他因素所帶來影響的人是我們的客戶，因此我很難在這方面做出具體評論。我們內部有一句話：希望不是策略，所以我們不想對外提出任何假設春天會陽光普照、進而帶動高需求的說法。如果真的如此，那當然很棒。這也是為什麼我們提供一個區間；那樣的話就能幫助我們達到區間的上緣。但就目前而言，我們認為那是值得期待的好事，但不能把它當作可依賴的前提。第二，談到全球其他地區。我認為已經有不少進展，而且這是一項非常聚焦的努力。我們專注於開發最符合特定客戶需求的等級。我一直回想到幾週前我去中國的那趟行程。我與中國最大的工廠製造商或塗料製造商會面。他們在那裡看重的點不太一樣。在許多情況下，石材紋理比平滑型塗層更重要。因此流變特性差異以及我們的產品也不同。所以我們正在讓團隊能夠開發更在地化的配方以滿足這些需求。像歐洲這樣的地區，對永續性的重視正在提高，這為我們創造了機會。因此這一直是一項聚焦的努力，真正去運用我們既有的基礎設施，並確保我們聚焦於區域客戶的在地需求，這是其中很大的一部分。我認為在中國，你不會看到大量或一波建築熱潮。這可能會隨時間改變，但團隊仍在那樣的環境下努力提升市占，而我們也確實做到了，我們做到了。我們已經有一些非常好的專案在推進。所以這就是我們用來抵消影響的作法。

Your next question comes from the line of Dmitry Silversteyn with Buckingham Research.

下一個問題來自 Buckingham Research 的 Dmitry Silversteyn。

Just wanted to clarify a couple of things. First of all, you put your -- in discussing sort of what was growing and what wasn't growing in the quarter, you talked about nutrition as something that you leaned on to get your volumes on absorption. I take it to mean that nutritional products are not amongst your higher-margin portfolio of products?

我想釐清幾件事。首先，在討論本季哪些在成長、哪些沒有成長時，你提到營養是你用來支撐吸收量、帶動出貨量的項目。我的理解是，營養產品並不屬於你們較高毛利的產品組合，對嗎？

Yes, that's correct. I mean, of course, we have some of our very niche products, which would have a more specialized nature. But literally, CMC can go into tortilla chips, and it can go into, in some parts of the globe, fillers that go into meat and sausages and things like that. And as you can imagine, that's less differentiated than you'd have in the other spectrum of our products.

是的，沒錯。當然，我們也有一些非常利基的產品，性質會更專業。但就字面上來說，CMC 可以用在玉米餅片裡，也可以用在全球某些地區用於肉類、香腸等產品的填充料中。而你可以想像，這相較於我們產品光譜另一端的產品，差異化程度較低。

Whereas on the other end, you've got things like clarifiers for beer, wine and juices that tend to be much more specialized and higher margin. I think if you look at the 3 end markets we're referencing, nutrition on an overall basis tends to be certainly better than construction and I would say marginally better than energy. But, we would put it in our, call it, lower 1/3 of end markets from an overall profitability perspective.

而在另一端，你們有像啤酒、葡萄酒與果汁用的澄清劑這類產品，通常更專業、毛利也更高。我認為如果看我們提到的三個終端市場，整體而言，營養市場肯定比建築好，我會說也略優於能源。但從整體獲利能力的角度來看，我們會把它歸在終端市場中較低的三分之一。

Got you. Okay. That's helpful. Secondly, you mentioned that your HEC sales were up 5%. My understanding was that at least a good chunk of HEC growth came from the coatings market, and yet the coatings market was one of the markets you identified as being weak. So can you reconcile those for me, please?

了解。好。這很有幫助。第二，你提到 HEC 銷售成長 5%。我的理解是，HEC 成長至少有相當一部分來自塗料市場，但塗料市場卻是你們指出偏弱的市場之一。所以你能幫我把這兩點對起來嗎？

Yes. The biggest difference is that we have seen a greater amount of that product going into hair, skin, home care, so that really is the difference and making up the difference from a relatively flat coatings dynamic to a growth on the HEC. HEC was, I believe, I'm referencing we had a record production sale of HEC as a product in the month of March, so the team is making progress. And if you don't mind me just using this as a digression because it's just consistent with our strategy. We always look by markets because that's where our products are most relevant and we've got to meet the needs. But what we've done is we've established the product technology platform teams that really look, for example, across all of HEC, across all of CMC, across all of PVC and say, how is that asset or series of assets performing? What are the key needs that we have and what are the opportunities? So that we can allocate capacity, we can allocate investment and we can allocate technical and development time into trying to drive gains from a full system standpoint, and as a result, not be just as dependent when we have some of these bigger assets on one market even though that one market may be the primary use.

可以。最大的差異在於，我們看到更多該產品用於髮品、護膚與家用清潔等領域；這就是差異所在，也使得在塗料動能相對持平的情況下，HEC 仍能呈現成長。我記得我提到的是，我們在 3 月份 HEC 這個產品創下單月產銷紀錄，所以團隊正在取得進展。如果你不介意我稍微岔題一下，因為這與我們的策略一致。我們一向以市場來看，因為那是我們產品最相關、也必須滿足需求的地方。但我們所做的是建立產品技術平台團隊，例如橫跨所有 HEC、所有 CMC、所有 PVC，並問：這項資產或一系列資產的表現如何？我們有哪些關鍵需求？有哪些機會？如此一來，我們就能分配產能、分配投資，也能分配技術與開發時間，從整體系統的角度推動改善；因此，當我們有一些較大型資產時，就不會只依賴單一市場，即使那個市場可能是主要用途。

And I think just to add to that commentary, the volumes that we run through areas like personal care tend to be much, much smaller than what -- and yes, it makes perfect sense that they'd be much, much smaller than what we tend to run through the coatings end market. But the profitability difference is pretty significant as well. So to the extent that we can continue to move more HEC -- different grades of HEC through the personal care space and certainly the pharma space, which we're maybe the only company that actually moves HEC through the pharma space, that will help us to improve the overall mix. Whether you see it in the volume numbers or not won't be as consequential because those volume numbers will be much more impacted by coatings. So we're trying to drive niche play differentiation and really develop customer solutions for the technologies that we have, and HEC is a nice advantage for us in that regard.

我想再補充一點：我們在個人護理等領域所跑的量，通常會小得多——而且是遠遠小於我們在塗料終端市場所跑的量，這完全合理。但獲利能力的差異也相當顯著。因此，只要我們能持續把更多 HEC——不同等級的 HEC——導入個人護理領域，當然也包括醫藥領域（我們可能是唯一一家實際把 HEC 導入醫藥領域的公司），就能幫助我們改善整體產品組合。你是否能在出貨量數字上看到，影響就沒那麼關鍵，因為出貨量數字會更受塗料影響。所以我們正努力推動利基差異化，並針對我們擁有的技術開發客戶解決方案；在這方面，HEC 對我們而言是一項很好的優勢。

Got you. Got you. One final question, if I may. My understanding was that your adhesives business is sort of leaning towards the semipermanent adhesives, if you will, kind of the tapes and labels and packaging, perhaps much more so than construction related. And this just goes to the earlier question asked. If the weakness in adhesives demand is not North American construction weather-related, what is it related to?

了解。了解。如果可以的話，最後一個問題。我的理解是，你們的黏著劑業務比較偏向半永久性黏著劑，例如膠帶、標籤與包裝，可能比建築相關的比重更高。這也呼應先前有人問的問題。如果黏著劑需求疲弱不是因北美建築天氣所致，那是與什麼因素有關？

Yes. First of all, we do have adhesives that go into construction. I mean, that's important here. I think you're right in your assessment, it's not the primary market, but it is an important part of it. It goes into laminated I-beams. And as a result, yes, as that market grows, so will demand. I think the other point is we've been pressing hard on the pricing front in that market. And so I mean, that's good because of the progress we've made. And I think that -- I think the adhesives business, we've got some timing issues, but I feel like the business is strong and we'll continue to get back fairly quickly to what we consider to be more historical growth rates.

是的。首先，我們確實有用於建築的黏著劑。我的意思是，這點很重要。我認為你的判斷是對的，它不是主要市場，但確實是重要的一部分。它會用在層壓工字樑上。因此，是的，隨著那個市場成長，需求也會成長。另外一點是，我們在該市場的定價方面一直在積極推進。所以我的意思是，這是好事，因為我們已取得進展。而且我認為——我認為黏著劑業務目前有一些時點上的問題，但我覺得這個業務基本面很強，我們也會相當快地回到我們認為較符合歷史的成長率水準。

Okay. So if I just heard you correctly, then there was some impact from construction, but there was also some volume attrition as you were intent on recovering margin and just pushing, I guess, customers that weren't willing to pay off to the side?

好的。所以如果我沒聽錯的話，那麼施工確實帶來了一些影響，但同時在你們致力於恢復毛利、並且我想是把那些不願意付費的客戶先放到一邊的情況下，也出現了一些量的流失？

Yes. I mean, I wouldn't attribute any of this to share loss. I'd have to go through every win and loss we have and so forth. But there's nothing that comes to mind in terms of any share loss. What it can do is it can affect timing sometimes. Sometimes customers will buy some material before a price increase. Or when you're raising price, they may be a little cautious in terms of the signal they send by purchasing more. So it's a dynamic, but -- and I don't see it as a structural shift. And as I mentioned, we have had the negative impact that's associated with the construction part, which isn't the majority but it does impact the business.

是的。我的意思是，我不會把這些歸因於市佔率流失。我得把我們每一筆贏單和輸單等都逐一檢視。但就市佔率流失而言，沒有什麼特別讓我想到的。它可能造成的是，有時會影響時點。有時客戶會在漲價前先買一些材料。或者當你在提價時，他們可能會比較謹慎，因為多買會釋放某種訊號。所以這是動態的，但——我不把它視為結構性的轉變。而且如我提到的，我們確實受到與施工相關的負面影響；這不是大宗，但確實會影響業務。

Your next question comes from the line of Jim Sheehan with SunTrust.

下一個問題來自 SunTrust 的 Jim Sheehan。

On your end markets, coatings and adhesives, I think you referenced North America coatings being weak. But are you seeing weakness basically across the board in those end markets or is it -- is North America or one region weaker than the others?

關於你們的終端市場——塗料與黏著劑——我想你提到北美塗料偏弱。但你們看到的是這些終端市場整體都在走弱，還是——北美或某個地區比其他地區更弱？

Yes. I would say that in -- as it turns out, I would say that North America really is probably the weakest end market that we -- or not end market, but end region that we have. As mentioned, we've had good growth in China, Europe, Latin America, rest of Asia. We've seen good growth. And so the kind of negative spot in this whole equation has been North America.

是的。我會說——結果來看，我會說北美大概確實是我們最弱的終端市場——或者說不是終端市場，而是我們最弱的終端區域。如前所述，我們在中國、歐洲、拉丁美洲、亞洲其他地區都有不錯的成長。我們看到良好的成長。因此，整個方程式裡的負面點就是北美。

Okay. And then raw materials, you talked about oil-based raw materials. Can you talk more about cellulosic? Are you getting any relief on cellulosic raw materials? And what is your outlook for that over the next couple of quarters?

好的。那原物料方面，你談到以油為基礎的原物料。能否多談談纖維素類？纖維素原物料有沒有出現任何緩解？你對未來幾個季度的展望是什麼？

Yes. So right now, we see it as being stable. We don't see a big change. Wood pulp will be down just a little bit in terms of the cost, but we don't use nearly as much as cotton linters. And so that as we see it right now has been pretty stable both in Q2 and as we look into Q3.

是的。所以目前我們看到的是穩定。我們沒有看到很大的變化。木漿在成本上會小幅下降一些，但我們使用的量遠不如棉短絨（cotton linters）。因此，就我們目前所見，無論在第二季以及展望第三季，都相當穩定。

Okay. And on your comments on the fiscal fourth quarter, you said you thought that demand would normalize. What gives you the confidence in making that comment? Do you have any visibility on orders out that far?

好的。另外關於你對財政年度第四季的評論，你說你認為需求會正常化。你做出這個判斷的信心來源是什麼？你們對那麼遠期的訂單有任何能見度嗎？

We have limited visibility on orders out that far. Our confidence is really in just the discussions that we have on an ongoing basis with our customers. You've seen and read and you talk more to some of our customers and suppliers, and you pick up a sense of optimism that this is less fundamental and will work its way through the system. But that is, once again, why we have a range out there, and if we see that on the markets stay or turn down, that's what leads us to the lower end of our range. Conversely, if we see something come back stronger and sooner, that moves us towards the top. But we don't have anything that would say fundamentally we're confident that our Q4, the demand will be substantially stronger. We need some more time on that. But our customers are not indicating that as we talk to them just as we're indicating it to you. Our customers have the same dialogue with us.

我們對那麼遠期的訂單能見度有限。我們的信心主要來自於我們與客戶持續進行的討論。你也看得到、讀得到，而且你與我們的一些客戶和供應商多交流，就會感受到一種樂觀情緒：這比較不是基本面問題，會逐步在系統中消化掉。但也正因如此，我們才給出一個區間；如果我們看到市場維持疲弱或轉為下滑，那就會把我們帶向區間的下緣。相反地，如果我們看到某些需求回來得更強、更早，那就會把我們推向上緣。但我們沒有任何東西能讓我們在基本面上有把握說第四季需求會顯著更強。我們還需要更多時間來觀察。不過，我們的客戶在與我們交談時也沒有這樣的指示，就如同我們現在對你們所表達的一樣。我們的客戶與我們之間也有同樣的對話。

I'm showing no further questions at this time. I would now like to turn the conference back to Seth Mrozek.

我這邊顯示目前沒有其他問題。現在我想把電話會議交回給 Seth Mrozek。

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

謝謝你，Bella。也謝謝各位今天早上的時間，以及對 Ashland 的關注。祝大家今天愉快。

Ladies and gentlemen, this concludes today's conference. Thank you for your participation, and have a wonderful day. You may all disconnect.

各位女士、先生，今天的電話會議到此結束。感謝各位的參與，祝各位有美好的一天。各位現在可以掛線。